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Impact of store image attributes on satisfaction and loyalty:

An exploratory Study of grocery shopping customers in


KLANG VALLEY, Malaysia


DEPARTMENT OF MANAGEMENT STUDIES
SARANATHAN COLLEGE OF ENGINEERING
TRICHY



























Abstract:
The study explicate that Malaysian retail sector has come
across rapid changes in recent years. There will be traditional as well
as new retail formats like hyper markets, convenience stores are
emerged. As a result it will have an impact in consumer satisfaction
and loyalty. Thus it is very important for retailers to know about which
store attribute will satisfy the consumer. The objective of the study is
to scrutinize the various store attributes influencing consumer
satisfaction and loyalty and also to recognize the relationship between
satisfaction and loyalty. Further to realize the impact of demographic
factors on consumer satisfaction and loyalty.
The study reveals that store attributes namely location,
service, promotion, price, brand choice, packaging, store atmosphere,
social experience were the dominant variable that determines the
overall loyalty of the consumers towards the retail grocery store. This
research acknowledged and proved the hypothesis that there is a
significant relationship between satisfaction and loyalty of grocery
shopping consumer.
Keywords: Satisfaction, Loyalty, Store attributes, Demographic factors

Introduction
Background of the study
During the past years both marketing academics and
practitioners have been intrigued by the relationship between
satisfaction and Loyalty. Most of these studies, however, have
concentrated on products (brands) and to a somewhat lesser extent of
services or channel intermediaries. Surprisingly, research on the
relationship between grocery retail store satisfaction and store loyalty
has remained limited, both in actual number as well as in scope. Yet,
in the present environment of increased competition with rapid market
entry of new store concepts and formats, the managerial challenge of
increasing store loyalty also presents the research challenge of a
more in-depth understanding and an empirical estimation of this
important type of consumer behaviour in the Klang Valley region of
Malaysia.
There is some evidence that store loyalty may be (positively)
related to store image attributes ( Osman, 1993). However, it has
remained unclear what the exact relationship between satisfaction,
store image attributes and loyalty in a grocery retail setting is. For
instance, one question that has been left unanswered concerns the
issue whether there is a direct impact of store image attributes on
retail grocery store satisfaction and store loyalty .In this study, the
researcher attempt to answer this question. We propose a model that
describes the impact of store image attributes on retail grocery store
satisfaction and store loyalty, taking into account the effect of
demographic profile on store image attributes.

Problem Statement:
This study focus on consumer behavior in traditional retail stores
and modern retail stores in Malaysia .
it is important for the retailers know which store attributes are
important and how it will affect and satisfy the consumers
behaviour while buying grocery items.
This study differs from the earlier studies on store choice
because it considers customer store selection based on the
store attributes pertaining to grocery products.
Furthermore, the current study also takes into account the
influence of non-store factors which are left behind by previous
studies.
Research Objective :
The grocery sector has experienced dramatic
changes in the last few decades with the emergence of new retail
formats such as hypermarkets, large scale supermarkets, and
convenience stores. As a result, it has affected the way consumers
shop as they have more choices to choose from. Thus, it is important
for the retailers know the reasons why consumers choose to shop at a
particular store, and also the factors that will influence their
subsequent behaviour. The objective of this study is to investigate
consumer behaviour in the grocery industry.
Specifically, this research aims to:
To understand the demographic and rational profile of grocery
shopping customers.
To identify the significant store attributes for store choice
decision for grocery purchase.
To examine the relationship between store attributes and
consumer satisfaction towards the retail store, leading to store
loyalty.
To develop and suggest an integrated structural measurement
model, which evaluates the impact of store image attributes on
consumer satisfaction and store loyalty.

FORMATS OF RETAILING

Literature Review:
Consumer Behavior in the grocery industry:
Jason M.carpenter et al.(2008) reveals the
demographic groups and their exact selection of stores and also
scrutinize the store attributes like price, competitiveness,
product selection,and atmosphere as drivers of retail format
preference.

Consumer demographics:
Michael Tinggi et al(2012), States that consumers
in the rural arears are more oriented to buy from bumiputera grocery
stores whereas in city espouse to shop at mega stores.they need to
satisfiy both rural and urban consumers and hold the new art of
trading and strategizing in order to remain relevant.

Store image attributes:
Nor, C. A. (2012) reveals that retail choice is induced by
types of goods purchased.the significant deteminant of retail store
choice in malaysia inclueds
Store personnel and physical characterisitics of the store
Advertising
Convenience and merchandise choice
Location
Peer influence
Product diversification and quality
Service provided by store



Location dimension:
Rosmimah Mohd Roslin et al, (2012) states that people get
attracted with merchandise, the price of variety of goods offered,
nearby location of the shop.




Products or brand choice:
Florence Kremer, et al, (2012) reveals that the price
reflection of store brand is certainly connected with retailers price
reflection. This will improve the retailers brand mage in terms of
values


Packaging Dimension:
Silayoi et al,(2004) the packaging is evolved from
the conventional function of safeguard the products from dust,
break, stealing, maltreatment and worsening. Glass, metals
plastics, paper and board are use as packaging material

Price Dimension:
Stephan Zielke, (2010) reveals the price aspect effect
the shopping intensions for diverse store format.
Discount stores-wothable for price
Super markets-price and value are equally important
Organic food stores-value go behind by price
Weekly market-price
Overall price is the important factor for shopping intension

Promotion Dimension:
Mara Pilar Martnez Ruiz, et al (2012),stated that the short
term retail price discounts increase in brand sales of the promoted
brands particulary in weekend

Service dimension:
Derek Thompson (2012) reveals that, if the people buy the
things online they dont bother about services otherwise service is the
important aspect of retailers. Sales people behavior is having an
impact in consumers shopping intensions.




Social dimension:
Joseph L. Gagnon,et al, (2005), shopping can give
opportunity for a social experience like seeking new
friends/associates/connections.it will have an impact in buying
behavior of consumers in retail stores.it will offer benefit of
association with others.

Convenience Dimension:
Kaufman (2011), states that consumers choose the
store based on function and travel time. consumer prefer shop
nearer to home.they can go for a shop while in travel to their jobs
or social and recreational activities.

Store Layout: Levy et al,(2010) states that store layout is
significant factor for grocery store. Because
It direct and attract the consumer to shop
It make a stability between sales and shopping space
To make an effective merchandise appearance


Customer satisfaction:
Patricia Huddleston et al, (2009) acknowledged that
store layout,price,product assortment and service have a certain
impact in customer satisfaction.it will be common for both the
conventional and speciality store formats.

Customer Loyalty:
Johan Anselmsson et al, (2009),confirmed
that private labeling have an impact in buying behavior of the
consumer which inturn leads to store loyalty.there is an
association between perceived quality and the price the buyer
willing to pay for the private label.


The relationship between stores image attributes, customer
satisfaction and store loyalty

Most previous studies in retailing suggest that
consumer behaviour towards a store depends on the store attributes
(Linquist, 1974-1975; Hansen and Deutcher, 1977/1978; Westbrook,
1981; Osman, 2001; Doreen and Benjamin, 2003; Nguyen et al, 2010).
Generally, the more favourable towards the store image, the higher the
chance that the store will be preferred and visited by the consumers.
However, some of the attributes may weigh more heavily than others
in influencing grocery store choice decision. Thus, some store
attributes are more important than others when consumers are
deciding where to shop for grocery shopping. Numerous researches
have been conducted to examine the impact of store attributes on
customer loyalty (Bloemer and Ruyter, 1998; Osman, 2001; Nguyen et
al, 2010). Most of the studies found that store attributes have a
positive impact on store loyalty. It is found that the loyalty towards the
store is affected by the consumers in store experience with the
characteristics of the store. In other words it is important for the
shopper to notice and pay attention to the attributes, in order to
influence their subsequent behaviour such as re-patronage behaviour.
However, a study by Bloemer and Ruyter (1998) found that store image
does not directly influence store loyalty. Instead, the study suggests
that the relationship of store image and store loyalty is mediated by
store satisfaction. Although most of the previous studies investigated
the relationship of store attributes and customer loyalty in a retail
setting, Westbrook (1981) studied the effect of store attributes from a
different perspective. Westbrook examined the relationship of store
attributes and customer satisfaction. The study found that customer
satisfaction is directly affected by their store experience with the
store characteristics.
On the other hand, Oliver (1999) finds that satisfaction is a necessary
step in loyalty formulation. Satisfaction is often regarded as an
antecedent of loyalty. It is found that the re-patronise intention will
increase when the consumer satisfaction increases (Swan and
Trawick, 1981; Grace and Cass, 2005). However, they found that
satisfaction has an insignificant positive effect on store loyalty in the
discount retail channel. So, it is worthwhile to investigate whether
satisfaction has a positive impact on store loyalty. The retailers or
marketer's job does not end with the consumers decision to shop at
the store. It is important for the retailers to continue to monitor
consumers post-purchase behaviour such as satisfaction level, which
will eventually lead to his or her subsequent behaviour, such as
willingness to re-patronize the store, or become a loyal, committed
customer. Thus, some studies also study the relationship of store
attributes, customer satisfaction and store loyalty (Bloemer, Ruyter,
1998; Doreen and Benjamin, 2003; Koo, 2003; Nguyen et al, 2010).

Research Gap:

Numerous researches have been conducted in the field
of grocery industry to understand consumer behaviour. In the process
of evaluating which stores to patronize in grocery purchase,
consumers consider a variety of factors, often referred to in the
retailing literature as store choice evaluative criteria or store image
attributes. The central issue for retailers is, therefore, choice. As the
outcome of the choice can only be known in the future (after using the
store), it is important for retailers to understand how consumers make
decisions in grocery purchase. This research addresses the research
gap where no other research has not specifically captured the said
nine dimensions (by keeping a comprehensive store attributes namely
location, products or brand choice dimension, Store layout, packaging
technology, price, promotion, store atmosphere, service dimension,
social dimension, convenience dimension to ultimately capture the
store image what consumers perceive) synchronized impact on
customer satisfaction and store loyalty in grocery store retailing. The
research also attempts to study the impact of consumer demographic
variables on store attributes, satisfaction and store loyalty.








Conceptual Framework:


The demography of the people plays a major role in retail
store selection. Because rural and urban people have different
purchasing behavior.

The next thing is that store attributes have an impact in
consumers buying behavior. store attributes like convenience, service,
store layout, social experience, price, product brand image, promotion
influencing much on consumer.

The store attribute should satisfiy the consumer then only
the consumer stared to purchase frequently

Once a customer get satisfied he/she became loyal to that
store.

Loyalty
Satisfaction
store
attributes
demography
Overall the demography have an influence in store
attributes so that the customer become satisfied which inturn leads to
loyalty.
Research method:
The researcher has used descriptive research design for
conducting the research. Descriptive research studies are those
studies which are concerned with describing the characteristics of a
particular individual, or of a group. Studies concerned with specific
predictions, with narration of facts and characteristics concerning
individual, group or situations are all examples of descriptive research
studies. Here the researcher intends to describe the situations where
the store image attributes influence the consumer purchasing of the
grocery product which ends up in satisfaction and loyalty.




Age 16-25 26-35 36-45 46-55 56 & above
Frequency
and percent
64(22.2%) 164(56.9%) 19(6.6%) 29(10.1%) 12(4.2%)
Gender Male Female
Frequency and percent 57(19.8%) 231(80.2%)
Marital Status Married Unmarried Living together Divorce
Frequency and
percent
191(66.3%) 77(26.7%) 8(2.8%) 12(4.2)
Race Malay Chinese Indian
Frequency and
percent
169(58.7%) 74(25.7%) 45(15.6%)
Education Secondary Diploma Graduates Masters
Frequency and
percent
11(3.8%) 172(59.7%) 102(35.4%) 3(1.0%)
Income level Below
RM2000
RM2001-
RM3000
RM3001-
RM5000
RM-5001-
RM6000
RM6001
above
Frequency
and percent
60(20.8%) 102(35.4%) 67(23.3%) 16(5.6%) 43(14.9%)
Family size 2 3 4 5 6 & above
Frequency
and percent
12(4.2%) 71(24.7%) 94(32.6%) 79(27.4%) 32(11.1%)
Occupationn Student Self
employed
Private
sector
Professionals House wife

Frequency
and Percent
6(2.1%) 44(15.3%) 206(71.5%) 28(9.7%) 4(1.4%)
Frequency of
grocery
purchase
Daily Weekly once Two weeks
once
15 days once Monthly
once
Frequency 27(9.4%) 47(16.3%) 9(3.1%) 140(48.6%) 65(22.6%)
and percent
Amount of
grocery
purchase per
month
RM500-
RM1000
RM1001-
RM 2000
RM2001-
RM 3000
RM3001-
RM4000
RM4001 &
above
Frequency
and percent
210(72.9%) 50(17.4%) 6(2.1%) 15(52%) 7(2.4%)
Types of
retail stores
Hyper
Market
Super
Market
Super chain
store
Convenience
store
Traditional
grocery
store
Frequency
and percent
61(21.2%) 157(54.5%) 13(4.5%) 51(17.7%) 6(2.1%)
Nature of purchase Cash Credit Both
Frequency and
percent
188(65.3%) 31(10.8%) 69(24.0%)



Hypothesis of the study:
Based on the findings from previous studies, this study
attempts to investigate the relationship between store attributes,
store satisfaction and store loyalty.
H1: Store attributes have a significant impact on customers
satisfaction and loyalty.
H2: Demographic profile has a significant impact on store
attributes, customer satisfaction and loyalty.

FINDINGS:
The findings of the demographic analysis highlights
that the majority of the respondents are middle aged consumers and
mostly females with married status. Ethnic composition among the
respondents got dominated by Malay race followed by Chinese and
Indians. The data findings also reveal that diploma holders found to
be a majority in the educational qualification category .The surveyed
data analysis reveals that the majority of respondents are in the
income range of Rm 2001-Rm 3000, which is considered to be above
the average salary level of Indianconsumers who normally has an
affordable buying power on the grocery purchase.The demographic
analysis also highlights that, most of the respondents belong to the
family size of four, followed by five and three which clearly portray the
nuclear family structure . Most of the respondents who do grocery
purchase were working for private sectors. The research data analysis
reveals that the grocery buying consumers make grocery purchase
mostly every fifteen days once and the next highest proportion shared
by consumers who make monthly purchases of grocery items. The
research study also reports that, most of the consumers spend Rm 500
to Rm 1000 for their grocery purchase which got considered
significant for grocery retailers . Finally , the demographic analysis
reveals that most of the consumers purchase grocery items using cash
purchase mode rather than credit mode, since the amount spent on
grocery purchase found to be minimum .The research data extracted
the factor with highest variance considered to be the important factor,
which constitute the following variables namely availability of organic
products ,providing targeted promotions, usage of novel technology to
attract consumers, providing in store credits cards, providing easy
entrance and exit to parking lot, providing shopping bus schedule to
consumers ,numerous cash counters to ease out queuing, assistance
to carry grocery items, providing financial service access, providing
proper point of display, allowing customers to use their sweep stakes
and retail store showing consistency in delivering quality service
.The study also found out that the grocery stores which provides
discounts, the store which is helpful and having friendly sales
people,the store having convenient operating hours ,the store which
got attractive merchandising ,the store offering low price was the
most significant store attributes that determine the overall
satisfaction of grocery retailing customers .Additionally ,the study
also found out that the service image attributes namely
convenience of the store, merchandise of the store, price offered by
the store, availability of fresh foods, labels with nutritional
information, attractive image in label, sending greetings to customers,
advertisement to build customer confidence, provide durable carry
bags, well assorted rest area, proper shelf display, proper selling floor
layouts, variety of credit cards accepted, home/door delivery services,
providing web sales and affirmative action by sales person were the
dominant service attributes that determines the willingness of grocery
purchasing consumers to purchase next time with the grocery
retailer. Easy entrance and exit to parking lot, shopping bus schedule,
long opening hours, physical facilities of the store, numerous cash
counters, assistance for carrying out grocery purchase, providing
financial services access, point of purchase displays, convenience
provided by the store, merchandise of the store, price offered by the
store were the dominant service attributes that influences consumer
to recommend the grocery retail store to other customers.consumer
belief that the national brands provide more value, high stock of
grocery assortment to be maintained, colour and logo on the package
should be culturally appropriate, assisting consumers to organize their
grocery list, providing accrual promotion and redemption promotion,
frequency of advertisement and promotion, separate checkout lines
for preferred customers, store providing atmosphere and opportunity
for a social experience were the dominant variables that determines
the overall loyalty of consumers towards the retail grocery store.The
study found that price is not the only consideration that weighs
heavily on the minds of consumers when shopping for groceries.
Health factors, product availability and in-store services , targeted
promotions, provision of easy entrance and exit, packing convenience,
availability of numerous cash counters, point of display, assistance in
carrying groceries, sale of organic food items, innovation, user-friendly
schemes to aid shopping and in-store services are also important
considerations. A combination of required attributes such as
convenience of the store, merchandising availability of fresh foods
labeling with nutritional content information, use of attractive
pictures/slogans in labeling, sending seasonal greetings to customers,
advertisements, provision of durable carry bag, provision of well
assorted space for relaxation, home delivery, online sales, and
affirmative sales person action and reaction will have a significant
effect on the loyalty.

CONCLUSION
The research concludes that the overall loyalty can be
enhanced if the above mentioned service image attributes get fulfilled
for consumers and appropriately delivered to them.
Oliver (1999) found that satisfaction is a necessary step in loyalty
formulation. Satisfaction is often regarded as an antecedent of loyalty.
It is found that the re-patronise intention will increase when the
consumer satisfaction increases (Swan and Trawick, 1981; Grace and
Cass, 2005). So, it is worthwhile to investigate whether satisfaction
has a positive impact on store loyalty. Hence, this study supports the
conclusions of Oliver that there is a significant relationship between
satisfaction and loyalty of grocery shopping consumers , increase in
satisfaction level will obviously increase the level of loyalty.

IMPLICATION AND CONTRIBUTION OF THE RESEARCH
Augmenting services that improve store satisfaction alone may not by
itself be sufficient to sustain store patronage. The sense of knowing
which factors can build a cordon around customer satisfaction and
loyalty, can only be gotten through systematic and sustained tracking
of shopping patterns. The above said information in the findings and
conclusions of the research should help the grocery retailers to
recognise the elements that contribute to customer satisfaction from
those that typically help sustain store loyalty and consequently
allocate their resources towards enhancing their level of perception
among consumer's mind. If the elements identified from market
intelligence are strategically planned for and managed with a
preparedness to sustain investment in them, grocery retail stores can
look forward to their customers coming back and thereby contributes
to the marketing literature by specifically capturing the significant
attributes responsible for consumer grocery purchase, which also
impacts consumer satisfaction and loyalty. The patterns discovered in
this empirical findings correlated to the theoretical framework which
have made it possible to draw some conclusions about reality i.e. the
constructed research model summarises those patterns namely store
attributes develop store image which brings in satisfaction and store
loyalty. If retail stores deliver and manage these emerged store
attributes strategically ,which will pave way for customers to develop
satisfaction and loyalty towards the retail grocery stores.


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