Innovative Journal Of Business And Management 8:1(2019)

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INNOVATIVE JOURNAL OF BUSINESS AND MANAGEMENT
Available online at
http://www.innovativejournal.in/index.php/ijbm

Impact of Intelligent Online Shopping Process on Customer Satisfaction: A case study

of Lahore, Pakistan
Huda Tahir1*, Zeeshan Maqsood3, Syeda Huma Jabeen2, Muhammad Ejaz Sandhu2, Rooma Qadeer1
1
Faculty Member at Management Sciences, University of Sialkot, Pakistan
2
Faculty Member at Pak-AIMS Lahore, Pakistan
3
Department of Statistics, University of Sialkot, Sialkot
Abstract:- The purpose of this study is to understand a model of online shopping process as well as to
point-out the major deriving factor towards customer satisfaction. Moreover, the trend of online buying and
selling can also be increased in developing countries by focusing more on price and quality with best
services. The customer satisfaction is the most important factor towards the development and explosive
expansion of online stores. The more an online vendor provides reasonable prices with best quality, secure
privacy, enjoyable element and more alternatives of offering products and services, the more will customer
satisfaction which in turns create a long-lasting bond of customer-online vendor relationship.
Data is collected by using questionnaire. Multiple linear regression applied to check which factors
influenced most customer satisfaction related to online shopping. Transaction influenced most customer
satisfaction as compared to interactivity and fulfilment.
The results of study disclose that on-line shopping in Pakistan is expressively affected by numerous
Demographic factors like transaction, age, interactivity, gender, fulfilment, and income. The results of the
study can be further used by the researchers for leading imminent studies in the parallel area.
Keywords: Online Shopping, Customer Satisfaction, Consumer Behaviour, Web, Demographic Factor.

1. Introduction:
Internet has dramatically influenced the business activities. There has been a great transformation of the
industries, markets, and businesses due to information and communicational technologies (ICT‟s). Industries
are now driven and controlled majorly by these technologies. In today‟s world, internet has become the
major part of conducting business transactions and forming new markets. The businesses are more conscious
to emerge new models by collaborating information and communication technologies in their business
patterns. Explosively, the concept of e-commerce is changing the way of buying and selling of goods and
services. In today‟s environment, people are more willing to use technology in their every field of life, thus
incorporating technology in their buying process also. Drastically, the concept of online store was expanded
in 1990‟s (Chen & Chang, 2003).
According to UCLA Center for Communication Policy (2001), online buying and selling, following
emailing and web-browsing, is the third most popular internet activity. Consumers are more willing now to
go for online stores to buy any product and service for their use. By changing business model, marketers
focus to carter more and more needs of people by offering highly-competitive products and services to its
customers. The marketers find it affordable and reasonable to carter a very large number of customers
scattered geographically which in turns reduce their cost of selling and marketing (Strauss & Frost, 1999).
Online shops are also becoming prominent in developing countries like Pakistan. People here are most
conscious about best prices and best quality with low effort which provides opportunities for retailers to

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introduce online stores in their business model. With the emergence of technology and advancement, online
marketers are endeavoring new positions in the niche market to acquire competitive edge over others (Chen
& Chang, 2003).
Customer loyalty is being affected by the satisfaction in competitive environments (Auh and
Johnsons,1998). A model has been used in the literature with reference to this concept. According to
Confirmation and Disconfirmation model for expectation and performance, there is a link between
satisfaction, performance, and expectation. The satisfaction is said to be high when the performance derived
from the use of product and service is high from the expectations and vice versa (Bitner, 1990)
Evaluation is also a determining factor in online customer satisfaction. It is a great challenge for online
vendors to provide right and sufficient information on right time. As online stores do not facilitate with
direct communication so chances become greater of user‟s switching to another website due to information
inadequacy (Ramayah Thurasamy, & Azizah Omar, 2012)
Entertainment is defined by extreme interest in finding products and services in electronic and virtual
environment. The excitement and amusement of minimizing the role of physical movement in shopping
defines a fun enjoyed by online shoppers (Shim et al, 2001). The extent to which the web site facilitate fun
and entertainment element to its customers represents by entertainment (Eighmey & McCord, 1998).
Fulfillment for Customer satisfaction has been influenced by delivery schedules positively. Zeithaml (2002)
was of the opinion that customer service renders to contact, response, and compensate a customer‟s problem
and inquiry. Customers seek for inquiries more frequently in online stores as compared to physical stores.
As online shopping lacks face-to-face communication which creates more ambiguities in consumer‟s mind.
These inquires may be after or before making a transaction. The vendor who responses clearly on right time
is always appreciated by customer‟s (wolfinbargar & Gilly, 2003) suggested that willingness to give
customer service, responsiveness and helping in it more likely to create loyal and satisfied customers.
2. Literature Review:
Interactivity is influenced by three components namely consumer's connection quality, ISP's overall quality,
and vendor's connection quality. As ISP's overall quality and consumer's connection quality are not under
the direct control of online vendor, a well-designed website can serve the purpose. Thus, Interactivity is
measured by two-measuring variables naming connection quality and website design (Chen & Chang,
2003). Literature shows that both of these positively effects customer satisfaction. The level of interactivity,
an online vendor provides depends on the connection quality it offered as well as the design and content of
online stores which are in other words websites. The easy navigation of a website gives positive shopping
experience to the customer (Heejin, Richard & Neal, 2009).Connection quality affects the customer
experience in online shopping. Satisfaction from overall interactivity can also be ascertained by connection
quality (Chen & Wells, 1999).Hu and Wo (1999) said customer satisfaction can be measured by presentation
and homepage design. It can be concluded that websites with high quality contents have positive influence
on customer buying decision process as well as on long term loyalty and satisfaction of online customers
(Liu & Arnett, 2000) E-commerce quality has been referred to as website ability of supporting online
ordering of products and services. Website quality affects customer satisfaction in a positive way as more
quality it offers; more will be the customer satisfaction.Transaction is the variable which can be measured
by value, convenience, entertainment, evaluation, and assurance also evidenced by the previous studies (e.g.
Novak et al., 2000; Roberts et al., 2003; Shiu and Dawson, 2002). Price and quality have been used to
measure transaction value generated through online shopping (Shiu & Dawson, 2002).

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A reasonable price has always been used to attract and retain the customers in markets (Chen & Chang,
2003). Consumers choose online shopping due to one factor of price as they find prices on some websites
very reasonable and competitive. As quality is the factor which creates loyalty loops and gives a binding to
the relationship. Quality has been used to measure customer satisfaction (Roberts & Mettos, 2003). The
concept of convenience in literature was first presented by Copeland in 1923. According to Copeland
Research; Convenience products are those which are easily available and usually purchased by the
consumers as involving less effort and less time to acquire them. The acquisition process becomes very
quick and impressive due to convenience products. In 2003, a concept of effort expectancy has been
introduced by Venkatesh. According to this concept, there is a perception prevailing in consumer‟s mind
who are online shoppers that online shopping is free of effort this shows that this perception is dominant
motivating factor in consumer‟s inclination towards online shopping. The features which make online
shopping an unsatisfied experience are too many formalities (Shen & Chiou, 2010). Every consumer has its
own taste, choice, preferences, and perceptions which mean that a selection of products and services is
subjective rather than objective. The consumers are widely disbursed which means they have different
needs, different purposes, different strategies to buy, own and use a product. The website which fulfills this
need is more likely to be used and consumers retained to it (Choi, Jayoung &Loren V. Geistfeld, 2004). This
increases a need for marketers to arrange a large variety of products so that maximum numbers of
consumers can be attracted and inclined towards websites offerings (Brassington, F. & Pettitt, S., 2000).
Besides design and appearance of a website, waiting time is also a deriving factor of customer satisfaction
(Weinberg, 2000). Online markets are highly competitive markets where a customer can switch to another
website by just one click as they are considered and known for their low-tolerance level. Before switching to
another website, online shoppers only wait for website feedback for eight seconds (Dellaert & Kahn, 1999).
Szymanski and Hise (2000) found that convenience, site design, and financial security were able to explain
consumer assessments of online satisfaction. A positive privacy policy offered by website vendors provides
an opportunity for retailers to have a win-win strategy. There is no general definition of term privacy. Social
practice theory defines privacy as a right to be left alone (Warren & Brandeis, 1890). Security perception
refers to how safe, manageable, and secured are personal details and payments have been focused and
awarded by a website (Cho & Park, 2001).
2.1 Customer satisfaction:
Literature on satisfaction begins in 1970‟s (hunt, H.1982). Two words have been used in the literature to
define the term „satisfaction‟. A Latin word of ‘satis’ meaning ‘sufficient’ has been used to defined first part
of word satisfaction whereas the second part contains a Latin word of ‘faction’ which means ‘fierce to do’.
In previous studies, the word itself has been used for level of comfort and relaxation attaining from doing
wrong and bad deeds (Clinton. Aigbavboa, &Wellington. Thwala, 2013). These meanings have been stated
for satisfaction „„adequate, make pleased, contented, enough” by using broader sense by previous literature.
The concept of satisfaction has been used in various fields differently. It can be used in any field and related
to anyone of them clients, patients, workers and employees. In marketing field, this satisfaction has been
majorly linked to customers using the products and services of marketers. Most of the work has been made
on this subject of satisfaction linking consumer buying any product and service from retailer. This subject
has been considered by vendor with respect to its consumer‟ own beliefs and evaluations (Kim, 1997).
Satisfaction is the term which has been used in different perspectives according to different perceptions of
its gainers. Literature evidenced that this does not mean same and equal to each and every consumer. This
depicts that it is not a common term rather it is more subjective term. It has been a misconception that
satisfaction is an emotion feeling rather it as an evaluation of an emotion. However, this concept has been

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defined differently by various researchers. Hoyer and MacInnis (2001) linked satisfaction with acceptance,
relief, delight, happiness, and excitement feeling. Moreover, it is purposed that satisfaction sometimes act as
a link in the buying process or sometimes it may work as an outcome of the buying process. The satisfaction
while working as process means its antecedents not the satisfaction itself whereas it has been measured by
linking variables when it is perceived as a consumption activity or an outcome (Parker & Mathew,
2001).Swan and Combs (1976) took initiative to associate term satisfaction with performance. It has been
proposed that satisfaction may effect by performance either positively or negatively. Positivity or negativity
of satisfaction can be measured through the perceived level of performances linking with expectation. If the
perceived level of performances falls below expectations meaning that satisfaction turns out to be negative
and in the same way if the perceived level of performance falls above expectations meaning that satisfaction
turns out to be positive.Some of the researchers create a link between satisfaction and loyalty. Loyalty
creates customer satisfaction, the more a customer is loyal the more he may be satisfied with products and
services provided by vendor. Mittal and Patrick, M.B (1998) proposed a prospect theory. According to this
theory, if a loyal customer switch to another vendor reason being of dissatisfaction experienced from its
vendor then he may forgo loyalty benefits in comparison with the benefits offered by new vendor meaning
loyal customers have high tolerance rate contributing towards more satisfied customers.Satisfaction can also
be measured through values derived by customer from fulfillment. The derived values may either lead to
over-fulfillment and under-fulfillment. The values will measure the exciting level of comfort which the
customer gets by using the products or service provided by provider (Oliver, 1997).Expectancy
disconformation theory presents a more applicable, appropriate and generalized definition of this concept.
This theory was proposed by (Oliver RL, 1980). According to this theory, a customer satisfaction is
associated with product performance variance. Difference between expected and perceived product
performance and expectations collectively creates a customer‟s satisfaction level. Greater the expectations,
greater the customer satisfaction will be (Aigbavboa & Thwala, 2013).Satisfaction may either be positive
disconformation or negative disconformation. A satisfaction is said to be positive disconformation when
results by using a particular good or service turns out to be better than expected. In the same way, it may be
negative disconformation of the results generated by using a particular product and service turns out to be
less than what was expected. This theory associates term satisfaction with the expectations concept. This is
the most widely adopted description of satisfaction in most of the recent literature.Satisfaction represents a
positive result generated by application of various scarce resources of an organization (Bearden & Teel,
1983). Customer satisfaction is positively associated with customer retention which means that if a
customer is satisfied with a particular vendor, he will perform other transactions with them which will
contribute towards growth and advancement of the business (Zeithaml, 2000).Swan and Combs (1976) make
an association of customer satisfaction with performance of a product and service offered by a retailer.
Customer satisfaction can either be positive or negative depending on the variance generated by a particular
transaction with the retailer.Literature reviews interactivity, transaction and fulfillment and their relevant
components have influence on forming customer satisfaction in context of online shopping.
3. Research Methodology:
In this study, the survey method has been used for collecting primary data. The filled questionnaires were
collected from 300 online shoppers of Lahore, Pakistan. By taking an advantage of cost-effectiveness and
time saving, convenience sampling method has been used. This study covers online buyers of age group
ranging from 18-50years old having an average age group in between 18-24 years old.
3.1 Measurement:

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Most of them having a household income levels in between 10000-40000 PKR and little more. To determine
the sample size formula proposed by Krejcie and Morgan’s, 1970, as given below developed by National
Education Association has been used.
s = X 2NP(1-P) / d 2(N-1)X2P(1-P)………………….Eq.1
s = sample size.
X2 = indicating for 1 degree of freedom at the desired confidence level, the table value of Chi-square
(3.841).
N = indicating the population size of the data.
P = Proportion of the population (assumed to be .50 since this would provide the maximum
sample size).
d = Representing the degree of accuracy (.05).
According to the formula in Eq.1, the sample size for this population is 350 approximately. For collecting
data about the variables self-administered questionnaire was constructed on five-point Likert scale and
distributed to target consumers who like to do online shopping. The questionnaire consisted of 31 questions,
which measures the relation of variables on the basis of Correlation and Regression. There was 85.7%
response rate overall.
3.2 Statistical Technique:
Descriptive Statistics compute characteristics related to online shopping customer satisfaction.Multiple
Linear Regression technique is used to check relationship between Customer Satisfaction with respect to
online shopping (dependent variable), Interactivity, Transaction, and Fulfilment (Independent variables). As
model is given in Results Section. Meanwhile, Correlation is applied to check the nature of association
between variables.
3.3 Designed Technological Accepted Model:
In this research, the technology acceptance model has been linked with customer satisfaction explaining that
if as a customer is satisfied he will prefer to go to the same retailer with purchasing intentions.
Figure.1 Technological Accepted Model

Technological Accepted Model shown the findings of the technology acceptance model which was used in
cross national study indicates that perceived usefulness, perceived ease of use and perceived enjoyment have
positive effect on intentions to purchase, whereas perceived risks have negative effect on customer‟s
intentions to purchase from a particular vendor.

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The technology acceptance model has been incorporated in this study in the way by using perceived
usefulness, perceived enjoyment and perceived risks which indicate the second component of online
shopping process and that is Transaction. Whereas perceived ease of use can be explained by Interactivity.
These components can define the technology acceptance model linked with customer satisfaction. The
perceived usefulness and perceived enjoyment has positive relation with purchasing intentions meaning that
in this study the transaction component has positive effect on customer satisfaction. More the value
generated from the transaction, more the customer will be satisfied. Perceived ease of use has positive effect
on intentions to purchase which means customer satisfaction positively affected by interactivity.
4. Results:
In this research, males were dominant identity with respect to questionnaires response. Their response rate
was 59.0% and females‟ involvement was about 41.0% out of the whole selected sample. This indicates that
males remained as the major contributor in this study of online shopping. The most of the respondents
belong to age group ranging from 18-24 which suggest that there were 40.3% contributors in online
shopping and do like to enjoy it. This age group belongs to youngsters who are more interactive in terms of
technological devices and understand it easily as compared to other age groups. Then, 34.3% responses were
obtained from middle age group people (30-39). 24.3% responses were collected from people having age
group ranging (40-49) very least responses are given by the age group ranging from 50(01.0%) and above as
respectively. Sample of this study show very clear and provide a better understanding, that respondents are
active mostly to buy a products and services electronically. It is shown that the respondents who are self-
owned are forming a virtuous percentage of 38.8%. The second most dominant category is of students in the
context of online shopping making 37.0% is the upright percentage to support this hypothesis. Job holders
contain 21.7% of the respondents who shop from an online vendor. The least response rate was noticed by
housewives. This study demonstrates that respondents used 37.7% daraz.pk mostly for online shopping.
30% respondents used Kamyu.pk, 27.0% respondents used Shop daily.pk and 5.3% respondents used
Yayvo.pk for online shopping.
Table.1 Overall Customer Satisfaction with Online Shopping
Overall Customer Satisfaction Percentage
Not Satisfied 6%
Satisfied 86%
Neutral 8%
As shown in Table.1 Overall Customer Satisfaction with Online Shopping given above shows that 86%
respondents satisfied with online shopping and 14% respondents are not satisfied with online shopping. This
indicates a positive future prospect of online shopping.
Graph.1: Customer Satisfaction with Online Shopping (Category Wise)

1.00% 5.00%
8.00%
Strongly Disagree
Disagree
43.00%
Neutral
43.00% Agree
Strongly Agree

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As shown in Graph.1: Customer Satisfaction with Online Shopping (Category Wise) Customer Satisfaction
with Online Shopping (Category Wise) illustrates that 1% respondents were Strongly Disagree with the
statement “Satisfied with online shopping”, 5% Disagree, 8% Neutral, 43% Agree and 43% Strongly Agree
about Satisfaction with online shopping.
4.1 Correlation analysis:
Pearson Correlation test is used to check first whether there exists a relationship between all independent
and dependent variable of the study. Secondly, correlation test is being applied to check the nature of
relationship existing between interdependent variable. In this research, correlation shows the positive
relation between all independent variables with the dependent variable. The results of correlation test are
given below, interactivity, transaction, transaction are independent variables of the study whereas customer
satisfaction is the dependent variable of the study.
Table.2 Correlations between Variable
Variables Statistics Interactivity Transaction Fulfilment Customer satisfaction
Interactivity Pearson correlation 1 .722 .338 .561
P-value .000 .000 .000
Transaction Pearson correlation .722 1 .187 .719
P-value .000 .001 .000
Fulfilment Pearson correlation .338 .187 1 .322
P-value .000 .001 .000
Customer satisfaction Pearson correlation .561 .719 .322 1
P-value .000 .000 .000
As shown in Table.2 Correlations between Variable values of Pearson correlation coefficient suggests that
there is a positive relation between interactivity and customer satisfaction which means that customer
satisfaction will be positively influenced by interactivity. Interactivity brings customer satisfaction, more an
interactivity between website and customer; more they will be satisfied with a particular website. Pearson
correlation coefficient of transaction and customer satisfaction is 0.719, indicating a positive relationship
between transaction component and customer satisfaction. The positive meaning more a transaction is
satisfied, more it will provide satisfaction to customers. Satisfied customers always provide growth
opportunities to e-retailers and show positive prospects for online retailers to have more business from this.
Pearson coefficient is 0.322 statistics gives a clear understanding of the positive association of fulfilment
with customer satisfaction.
4.2 Multiple Regression Analysis:
To understand the extent of an impact of each variable on customer satisfaction, regression analysis is
applied over given data
Table.3 Summary of Reggression Model
Model R R square adjusted r square Std. Error of the estimate
1 .744a .553 .549 .51646

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Table.4 Analysis of variance of regression

Model Sum of squares Df Mean square F P-value
Regression 97.793 3 32.598 122.211 .000a
Residual 78.953 296 .267
Total 176.746 299

As shown in Table.3 Summary of Reggression Model multiplelinear regression, criterion variable

(dependent variable) is customer satisfaction which is shown by (customer satisfaction). Whereas, predictors
(independent variables) are interactivity, transaction and fulfilment which are stated by (interactivity),
(transaction), and (fulfilment). Multiple correlation coefficient r=0.744 by using interactivity, transaction,
and fulfilment. Meanwhile, r-square=0.553 which depicts that predictors (independent variables) taken as a
set, accounts for 55% variance in customer satisfaction. It suggests that 55% impact on customer satisfaction
(customer satisfaction) is due to above predictors (interactivity, transaction, fulfilment). However, 45%
changes are due to other remaining variables which have not been taken in this study and thus, other
variables show unexplained variability. Adjusted r square=0.549(approx.) Which is lower than the value of
unadjusted r-square (.549<0.553)
As shown in Table.4 Analysis of variance of regression is showing that model is significantly good fit so,
meaning relationship between all independent variables and dependent variables is highly significant. The
above table shows p-value =0.000 that is significant statistically present that all these three independent
variables combine together to affect customer satisfaction.
Table.5 Regression Coefficients of variables
Variables Beta Std. Error T P-value
Constant .622 .237 2.628 0.000
Interactivity .142 .093 04.328 0.000
Transaction .747 .062 12.037 0.000
Fulfilment .011 .030 04.654 0.000
Linear Reggression equation is being used as given below:
X=α+β1y1+β2y2+ β3y3+ei whereas;
X = customer satisfaction, y1=interactivity, y2= transaction, y3=fulfillment
X = 0.662 +.142 y1+.747y2+.011y3+ei…………………………………………………………….………..Eq.2
The Multiple linear regression equation Eq.2 given above shows that customer satisfaction will increase by
0.142 when one unit increases in interactivity. It further indicates that customer satisfaction is expected to
increase by 0.74 by 1% when transaction rate get high and consequently, proposing an expected change of
0.011 in customer satisfaction by an increase of 1% in fulfilment. The tables also indicate values of standard
errors of 0.237, 0.093, 0.062 and 0.30 meaning that the values of regression coefficients are calculated fairly
and rightly as the values of standard errors are small.
5. Discussion:
It is concluded that e-marketers need to focus more on Transaction variables as it derives most of the
satisfaction. According to the results, Customer satisfaction is influenced by the three major components of
online shopping process. With reference to the results generated by using Multiple linear regression, it is

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observed that in case of online shopping, customer satisfaction is greatly influenced by 2nd component of
online shopping process (Transaction). This explains that consumers who buy online are more concerned
towards the characteristics of price, quality, privacy concerns, enjoyment and variety in contrast to website
design, connection quality, after sale support and exchange policies. The second determinant which impacts
customer satisfaction after transaction is Interactivity. The customer who finds best products and services
from an online store also expects to find a good connection quality.
The least effect on customer satisfaction is by fulfilment as above results represents least value of it. The
consumers find it fine and bearable if a website does not provide many alternative options for exchange and
return policies to some extent. The customer satisfaction is the most important factor towards the
development and explosive expansion of online stores.
Future Research Implications
The generalization cannot be made on a very large size of the population because the behaviours of online
buyers, as well as their responses, will be different. Non-probability technique serves as the limitation of the
study, as it is concerned not with each and every element of the population. The demographics can be apply
to show how frequently the consumers buy from the online store. Future research will be comprising of
taking a large sample size, using a probability sampling technique and investigate the buying pattern of
online buyers.
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