– 211.0 Introduction
Firstly, customer satisfaction is one of the top strategic issues in the future. Nowadays, many companies use customer satisfaction measurement system that is offered by Research Company in order to understand their customers. By using this system, the company is able to capture the voice from the customer and then based on the customers’ feedback then improves their products.
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In today’s market, company needs satisfaction information to make sound business decision. Therefore, company needs to understand the customer’s overall satisfaction and then the company will get to know what kind of products or services that the customers are most and least satisfied with. It is because if the customers felt dissatisfied then most likely they will run over to the competitors. Hence, customer satisfaction is very important in current business world.
According to futurist and corporate advisor, Faith Popcorn, a new type of consumers emerged in the 90s. They are “Vigilante consumers”, a new generation of super consumers who are smart, discriminating and vocal. They demand value for their money and expect the companies to be responsible and accountable, when companies don not respond; these “Vigilante consumers” will make sure that they tell anyone who will listen why they should not do business with those companies. Therefore, satisfying these smarter consumers just makes good business sense.
In addition, the proposal of this research is a study on the marketing in relationship to customer satisfaction on IKEA furnishing company Malaysia. Customers are the main source for the business world. Business cannot run and company also would lose if without the supporting of customer. Therefore, many companies are applying the customer satisfaction measurement in order to study their customer’s level of satisfaction. Company would have bigger chance to achieve success when they can understand the customer’s need, satisfaction and dissatisfaction.
Furthermore, the purpose of this study is mainly on to understand the sources of dissatisfaction and the areas that required for improvement. In this study, some ideas and useful suggestions will be proposed. Lastly, when routinely ask customers for feedback and involve them in the business, it is also a way to ensure the successfulness of the business.
History of the IKEA Furnishing Company
Firstly, IKEA was founded by Kamprad in 1943. From that time, IKEA has expanded to include a number or home furnishings stores around the world. Inter IKEA system B.V. is the owner and franchiser of the IKEA concept. Irrespective of their ownership all IKEA retailers worldwide operate on a franchise basis.
IKEA of Sweden AB is responsible for the entire IKEA product range, thereto commissioned by inter IKEA System B.V. The entire product in the IKEA range is distinguished by the label “Design and Quality, IKEA of Sweden”.
From inter IKEA Systems B.V. independent IKEA Group includes not only most IKEA retailers, but also the product development centre IKEA of Sweden AB and trading and wholesale companies. The IKEA Group actives are coordinated by IKEA International A/S in Denmark. The IKEA Group is owned by a charitable foundation in the Netherlands.
2.0 Research Questions
Why customer satisfaction is so important?
How does customer satisfaction influence the business?
What are the variables involve when examining customer satisfaction?
3.0 Research Objectives
To analysis customer satisfaction theory and concept.
To establish recommendations and suggestions for the company.
To evaluate the variables involve when examining customer satisfaction.
4.0 LITERATURE REVIEW
4.1 Definition of customer satisfaction
According to Leon G. Schiffman & Leslie Lazar Kanuk (2007, p. 9), customer satisfaction is the individual’s perception of the performance of the product or service in relation to his or her expectations. They may be a business people, tourists, youngsters, retired couples or celebrities. Moreover, they could not be looked as one group as their needs is differently and hence the service should reflect that.
Nowadays, customer had started aware of the importance of quality product and service that had provided by a firm. First of all, they will experiences the product or service and then evaluate their experience and finally decide whether they should purchase the product or service or not. If customers are satisfied with the product or service, they will repurchase again. Otherwise, they will run over to the competitors.
The word satisfaction is derived from the Latin Satis (good enough) and Facio (make). The Oxford dictionary goes on to further describe it as fulfillment, leaving nothing to be desired, to be content or pleased. However, to research in customer satisfaction it is necessary to move beyond more fulfillment or satisfaction.
Philip Kolter (2006) stated, customer satisfaction is a person feeling of pleasure or disappointment resulting from comparing a product perceived performance in relation to his or her expectations. From here, we can clearly understand that customer satisfaction is based on the performance in the relation to the customer expectations after purchased. If the performances are failing short of expectations then the customer will be dissatisfied. Besides, if the performances exceed the expectation of customer then they will be highly satisfied or delighted.
4.2 Why customer satisfaction is so important?
Firstly, customer satisfaction will influence whether the customer will repeat buying products form the same company or not. If customers are holding positive evaluations, they will more likely to repurchase the product again. However, if they are holding negative evaluations, they will unlikely to buy again.
Besides, customer satisfaction will shape world-of-mouth communication. It will influence consumers’ future purchase behavior, post-consumption evaluations and other behaviors as well. Therefore, we could not underestimate the powerful of world-of-mouth.
In addition, negative consumption experiences will reduce the odds of repeat buying and it will also lead customers to say unflattering things when discuss their experiences with others. Hence, it showed that customer satisfaction is very important for IKEA. This is because IKEA customer will directly promote IKEA by word-of-mouth advertising no matter they are satisfied or dissatisfied customer. No doubt, nowadays this is the most effective advertising method.
Figure 1: The Customer Satisfaction- Price Sensitivity Relationship
Furthermore, customer satisfaction can lower consumers’ price sensitivity. It is because according to Blackwell, et al., (2006) said that typically the more the customer value something, the more they are willing to pay for it. In current market, many companies will do lots of customer analysis or survey in order to understand more about the customer needs, wants and satisfaction. They found out that if they promptly follow up and solve the customer’s complaints, the customer may be more likely to do business than those who did not have a complaint. Therefore, high customer satisfaction makes money and enhances the company’s profitability.
4.3 How does customer satisfaction influence the business?
In today’s fast-paced and rapidly changing business environment, monitoring and managing customer relationships is critical. In highly competitive market, it is increasingly important for organizations in order for them to understand their customers’ needs and offered something to fulfill their needs.
One of the ways to understand the customer is to monitor satisfaction with their purchase and consumption experiences. When a customer is satisfied, it would helps to increase the possibility that he or she will retain loyalty and build a long-term relationship with the company. The reason that company wanted to maintain the loyalty of customer and increase the long-term profitability for the firm is it will lead them to the successfulness of the business and they would able to expand their market.
Besides that, today marketing must understood not in the old sense of making a sale-“telling and selling”. However, is in the new sense of satisfying customer’s needs. If the marketer does a good job in understanding customers’ needs, developing products that provide superior value and prices, distributing and promoting them effectively, the products is able to sell very easily. Hence, it will influence the business in gaining more profitability and achieving a mission and vision statement in the future.
Many companies are also realizing that losing a customer means more than loosing a single sale, it means losing the entire stream of purchases that the customer would make over a lifetime of patronage.
On the other hand, a good new product idea comes from watching and listening to customers. The company can conduct surveys or focus groups to learn about customer needs. It can help to analyze the customer and meanwhile it could able to find out ways to satisfy the customer.
Finally, customer is often creating new products and use on their own, and companies can benefit by finding these products and putting them on the market. To satisfy the customer is also good source of ideas for new uses for existing products that can expand their market and extend their life (Kotler & Armstrong, 1997).
However, customer can also influence all the business with a benefit from stable relationship with suppliers. Business buyers have found that partnerships with suppliers. Business buyers have found that partnerships with their suppliers are essential in producing high-quality products while cutting costs. Customers remain loyal to firms that provide them with greater value and hence satisfaction can come in a variety of forms ranging from financial benefits to a sense of well being or confidence in a supplier to structural bonds (Lamb, Hair & McDaniel, 2000).
Therefore, the customer satisfaction can influence the business. It will then leads the companies to be more successful in the future, for today key issues in developing competitive advantage include creating customers value, maintaining customer satisfaction, and building long-term relationships with customer.
4.4 What are the variables involve when examining customer satisfaction?
4.4.1 Marketing Mix
The marketing mix is one of the major concepts in modern marketing. It is defined as the set of controllable tactical marketing tools-product, price, place and promotion – which the firm blends to produce the respond it wants in the target market in order to satisfy to the customer (Kotler & Armstrong, 1997)
An effective marketing program blends all of the marketing mix elements into a coordinated program designed to achieve the company’s marketing objective by delivering value to customer. The marketing mix constitutes the company’s tactical tool kit for establishing strong positioning in target market. Then, successful marketing mixes have been carefully designed to satisfy target market and can also satisfy the customer in order to achieve competitive success.
4.4.2 Competitive Position
In any industry, be it attractive or not, some firm will always outperform their competitors. It is essential for a firm to possess competitive advantage in order to survive (Raymond, 2000). To do so, the firm must position itself appropriately. Competitive positioning is the ability of the business to select the appropriate generic strategy for its industry, and configure its value-adding activities in support of it, which will generate competitive advantage (Stonehouse et al, 2000)
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The positioning of the enterprise will be more advantageous than another whatever the profitability level (Passemard and Kleiner, 2000). Lindahl and Beyers (1999) also emphasize the importance of positioning, “while many factors contribute to a firm’s performance – firm performance within a particular marketplace is ultimately driven by how the firm positions itself in relation to providers of similar services.” All else being equal, performance outcomes are associated with firms pursuing the right competitive strategies.
“At the heart of positioning is competitive advantage” is Porter’s (1998a) opinion. Porter suggests that a firm that can position it well may earn high rates of return even though industry structure is unfavorable and the average profitability of the industry is therefore modest.
Competitive analysis gives a marketing strategist a sense of their organization’s respective strengths and weaknesses, which, in turn, may suggest opportunities for differentiation. Relating this insight to the internal corporate analysis should suggest which benefits should be offered to which target market segments. This analysis should consider both direct and indirect competitions.
However, competitive analysis can give you a good sense of how competitors might be likely to act. If chances seem high that a stronger competitor will move to occupy the same niche with a superior service concept, then it would be wise to reconsider the situation (Christopher H. Lovelock et al, 1998)
This competitive analysis should be involvement take in orders to investigate of the customer satisfaction because to be successful of our business, a company must know competitors does their business gave faces in order to provides a greater customer value and satisfaction then its competitors do. Thus, marketers must do more then simply adept to the needs of target customers. They also must gain strategic advantage by positioning their offerings strongly against competitors’ offering in the minds of customers.
Methodology
5.1 Research Design
According to Cooper & Schindler (2001), research design is to design the research in a way that defined as the blueprint for fulfilling research objective and answering questions. It is an important aspect of all research study because inaccurate information in data collection can produce the invalid results in the end of the research.
5.2 Theoretical Framework
Figure 2: Marketing Mix
The theoretical framework that has been used to evaluate the information gain for this research is the marketing mix. The marketing mix was chosen this because this framework provides the opportunity to evaluate the marketing mix shapes the role of marketing within all types of organizations, both profit and nonprofit. Each element in the marketing tools product, price, place and promotion, consists of many sub elements. Marketing managers make many decisions based on the various sub elements of the marketing mix, all in an attempt to satisfy the needs and wants of consumers.
This function of the Marketing Mix is to help IKEA Furnishing Company Malaysia develop a package (mix) that will not only satisfy the needs of the customers within the target markets, but at the same time to maximize the result of the organization.
5.3 Type of Data collection
The best method used to gain information would be secondary data collection base on the nature of the research title. According to Ghauri and Gronhaug (2005), cited from Saunder et al (2007), stated that the main advantage of using secondary data to answer the objective and research question would help in saving valuable resource especially time and money. Moreover, as compared to primary data collection, secondary data collection would undoubtedly be much less expensive (Saunders et al, 2007)
According to Hair et al (2003) has also claimed the secondary data collection is often free of charge or it can be purchased for a much cheaper price as compared to a primary data collection. In this proposal is strongly based on secondary data collection. By taking into consideration of the limited time to span and other costs at primary data collection as well as the sufficient resource available for data gathering at secondary data collection, the author decided to conduct secondary data instead of primary data. It shows different advantages of secondary data to support author to choose the data.
May have fewer resource requirement
According to Ghauri et al (2002), indicated that it is enormous in saving resources, especially author time and money. And also enable author analysis far larger data sets such as those collected by government surveys.
Unobtrusive
Stewart and Kamins (1993), said that secondary data are likely to be higher-quality data then could be obtained by collecting author own self, and provide unobtrusive measure. Furthermore, Cownton (1998) refer to this advantage as eavesdropping, emphasizing its benefits for sensitive situations.
Longitudinal studies may be feasible
For many research project time constraints means that secondary data provide the only possible of undertaking longitudinal studies. (Saunders et al, 2003)
Can provide comparative and contextual data
It means that author can place his own findings within a more general context or alternatively, triangulate author’s findings beside, secondary data such as the census can be used to assess the general of finding, in other words how representative these data intention of exploring any such relationship.
Permanence of data
Secondary data generally provide a source of data which is both permanent and available in a form that may be checked relatively easily by others, it also shows that the data and the research finding are more open to public scrutiny. (Denscombe, 1998)
Table 1: Advantages of secondary data
5.4 Measurement
Acquire relevant and dependable secondary data is an important part of this research. Therefore, most of the data has been gain from the reference book which can found in KBU International College library. Moreover, other information form journal and article has been collect form on-line which is Anglia Ruskin university library, Emerald website, British library, EBSCO Resource, Google Scholar and other databases. The information search has been performed using computer and manual procedures on a variety of sources listed below. In collecting data more importance was giving to the internet, as it allow faster information processing and accessibility to up-to date credible academic article and information.
5.5 Sources of Secondary data
The sources of Secondary data use are as follows:
Reference book
Article published in professional Journals
Magazines and newspapers
Thesis and Dissertation of other authors
World Wide Web
6.0 Limitation of Study
As the research method in this proposal is based on secondary data, there will have some limitations to be considered. Saunder et al (2007) shows that there are instances where secondary data may not be directly relevant or obsolete, and also it could be of vital importance exploratory research, as it provides a broader understanding of the topic from an overall perspective.
Furthermore, the scope includes everything from the type of study, the study setting, the measurement, the sampling design and even the analysis. There are certain secondary data collected may not match to the research needs, available of information is limited.
Gantt Chart
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