Final Report - The thesis started on the basis of factors influencing customer’s satisfaction PDF

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The thesis started on the basis of factors influencing customer’s satisfaction in ride sharing platform in Bangladesh. This report gives an insight into the important influencing‘s in ride sharing platform in Bangladesh. It gives us an insight into how those factors influence the customer satisfacti...

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Topic: Factors influencing ride sharing platform in Bangladesh. CHAPTER ONE: INTRODUCTION TO THE STUDY 1.1: Background of the problem The ride sharing services has been the newest embodiment that has revamped the transportation phenomenon over the world. In recent years, tremendous changes has undergone in transportation industry especially in Bangladesh. Emergence of mobile appbased transportation service has increased the demand on ride sharing services such new entrants like Uber and Pathao services have revamped the taxi service industry which increased the competition among local taxi industry and public transportation. As a modern consumer, they become sage whereas not only emphasis on high quality but also emphasis on high professional transportation services. Due to high motorization rate, heavy traffic congestion, parking problems and inadequate public transport infrastructure led to increase the demand for private cars and ride sharing services in Bangladesh. Recent research exposed that taxi drivers are overcharging and not using meters, poor attitude of taxi drivers, dirty taxis and uncomfortable rides are making users concern. Few research and online review revealed in Uber user perspective like Rayle L. (2014) many customers are not satisfied with the service of Uber. They faced problem with price, safety, pickup points, driver’s attitudes, response of complaints, car interior, etc. Some reviews are: I ordered an Uber around 1130pm on July 20, 2018 for a 4.6 mile drive that would normally take 10 minutes. The regular car said it would cost almost $17 and the rideshare option was between $11-12. I opted for the cheaper option to save some money. The app told me the driver would arrive in 5 minutes; I waited in excess of that for the driver, fine. I get in the vehicle and settle in to look at my phone to see the fare jumped to $14.06. I agreed to one fare and Uber charged me over the agreed upon fare. Not to mention the driver drove so slowly as if he was waiting for another pickup along route. I arrived to my destination much later than expected. He would stop at stop signs and wait half a minute before moving, it was past midnight at this point and there was nobody on the road. He also drove a route that was slightly longer than another.

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On the other hand Pathao founded in 2015 but they become buzzword in 2017/18 and they are facing completion from UBER, TOMA taxi Bangladesh. If customers are satisfied, they will be loyal to company and recommend to others the company name. So, it is important for the companies and researchers to know the factors influencing customer’s satisfaction to become loyal. Limited literature done in the taxi industry in Bangladesh especially in Pathao and Uber services and evidently there’s a gap in literature in service quality and customer satisfaction in Bangladesh in ride sharing services industry. Thus, the researcher concerned these grounds in these research endeavors, the factors influencing customer satisfaction of Uber and others services in Bangladesh. In light of the aforementioned points, the purpose of this study is to identify the factors influence on satisfaction of ride-sharing users. We used dimensions namely reliability, assurance, tangibility, empathy and responsiveness from SERQUAL (Parasuraman et al., 1985), comfort and price (affordability) from McKnight et al.’s (1986) and promotion and coupon redemption from Lovelock and Wright’s (2002)to study ride-sharing customer satisfaction in ride-sharing platform in Bangladesh. 1.2: Problem Statement To identify the factors influencing customer’s satisfaction in ride sharing platform in Bangladesh. 1.3: Research Objectives The main purpose of this study is to identify factors influencing customer’s satisfaction in ride sharing platform in Bangladesh. This study also intended to determine whether there is a positive or negative relationship between factors influencing customer satisfaction (reliability, assurance, tangibility, empathy, responsiveness, price, comfort, promotion and coupon redemption) and customer satisfaction. As a modern consumer, they are wise and give emphasis not only on high quality but also on high professionalism in transportation services. We are intended to determine which factor influence mostly customer satisfaction in ride sharing platform in Bangladesh.

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1.4: Importance of the study I hope that this study will contribute to further research, organizational perspective and individual perspective (customer). The certainty and reliability of the result will able to act as a guideline for future research in Bangladesh in ride sharing services. In organizational perspective, this study will help to understand the relationship between Customer satisfaction and service quality with tangibility, reliability, price, promotion and coupon redemption, and comfort. Besides, this study will help ride sharing services to determine the contributing variable which has the most significant relationship on service quality. It will also help to retain customer as loyal. Furthermore, this study helps the ride sharing services companies by providing useful information to set appropriate policy to keep customer experiences at maximum level. 1.5: Scope and limitation of the study The data for the current study were collected from the respondents above 18 years old and sample size is only 100. So, the sample may not be indicative of the general population. A larger sample size that includes people of differing ages, income levels, and educational levels would be helpful to validate the current findings. In the current study, there was no attempt to differentiate between users of the sharing economy and service providers in the sharing economy. Such a distinction may help in further understanding gender disparity, and shed light on levels of participation, attitude, and the perceived value. To conduct this study, time was very limited, only three months which was not enough to get deep insight. Besides, there was lack of sufficient funding to conduct this study. The study had to conduct with my own resources that a big dam to do it quite properly.

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CHAPTER TWO: LITERATURE REVIEW 2.1: Ride sharing services in Bangladesh Uber and Patho services are based on ride sharing concept and has gained a major success in “ride sharing service”. The development technology enables the companies to find consumers; whereas ‘ride sharing’ is based on the preferences for ‘experiences’ over ownership. The buzzword ‘ride sharing service’ emerged in the mid of 2002 and become popular between 2008 and 2010 in other part of the world. Uber is a taxi E-hailing mobile application founded by Travis Kalanick and Garrett M. Camp in 2009 which located in San Francisco, California. According to Travis (2015) Uber has being serving in 311 cities and 58 countries around the world. Uber launched its rise sharing program in Dhaka on 21 November in 2016. On the other hand Pathao founded in 2015, it is an On-Demand logistics in Bangladesh both for personal users (on-demand motorcycle rides and cars) and ecommerce merchants. In Uber service delivery system the riders send a trip request to the nearest Uber driver and the application will track the available Uber car to pick a rider than only the location will show to the driver. Based on the General Packet Radio Service (GPRS) or google map the driver will send the rider to their destination and they can rate scores for the driver. Pathao which started in 2015 in Bangladesh and it’s a Smartphone-based ride sharing application (app). Currently, Pathao Ride sharing service is only available in Dhaka and Chittagong. Pathao ensures the reliability of the rider through strong recruitment program. This concept is similar to Uber, as a ride sharing platform to make available bikes on rider’s demand through Google mapping and location sharing technology. 2.2: REVIEW OF THE LITERATURE 2.2.1: Customer Satisfaction Customer Satisfaction (CS) has gained importance in business to measure products or service performance. In simple terms, Customer Satisfaction is regarded as customers’ evaluation of their Products and consumption experience with a product or service to meet the customers’ needs (Chen, Chang, Hsu, & Yang, 2011).

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According to Kotler and Keller (2006) satisfaction is an individual evaluation either they are satisfy or not satisfy based on their expectations towards product or service performance. In line with the definition, customer satisfaction reflected from the dis-confirmation theory of customer expectation, while a positive dis-confirmation leads to satisfaction and negative satisfaction leads to dissatisfaction (Oliver, 1980). 2.2.2: Service Quality SERQUAL is one the most common measurement scale for service quality developed by Parasuraman et al. (1985; 1988). Nevertheless, there is less research study on service quality dimensions in ride-sharing services in Bangladesh. In this study, the researcher user service quality dimensions such as Reliability, Assurance, Tangibility, Empathy, and Responsiveness to examine affecting customer satisfaction of Ride-sharing users in Bangladesh. Therefore, ride- sharing services like Uber and Pathao must leveraging service quality to achieve competitive advantage as well they need to meets rider’s expectation which will created customer satisfaction help to build brand image in return it will increase the company’s profitability.

2.3: Conceptual variables 2.3.1: Reliability Reliability means the ability to execute the service with consistency, punctuality as we can see in the transportation services reliability like arrival at destination; journey length; communications; and scheduled routes are important to consider for the ride-sharing service quality dimensions (McKnight et al. 1986). Following study by Horsu and Yeboah (2015) research on customer satisfaction towards minicab taxi services in Ghana. They used six variables namely reliability, continuous service, safety, comfort, affordability and drive behavior were tested to examine the relationship with customer satisfaction. Through multiple regressions analysis they found that continuous service, comfort, affordability and reliability have a significantly positive influence on customer satisfaction.

H1.Reliability has positive relationship with customer satisfaction. 5|Page

2.3.2: Assurance. Assurance is defined as “the employees’ knowledge and courtesy and the service provider’s ability to inspire trust and confidence” (Zeithaml et al., 2006, p. 119). According to Andaleeb and Conway (2006), assurance may not be so important relative to other industries where the risk is higher and the outcome of using the service is uncertain. Thus, for the ride sharing industry, assurance is an important dimension that customers look at in assessing a company or a driver for a trip. The trust and confidence may be represented in the personnel who link the customer to the organization (Zeithaml et al., 2006). H2: Assurance has positive relationship with customer satisfaction. 2.3.3: Tangibility According to Parasuraman et al., (1988) tangible refers to a person’s appearance, physical facilities like settings, decorations, display, and equipment. Besides that, Bellini et al., (2005) stated that tangibles like the safety and convenience for customers and it representative as company’s image and quality (Zeithaml et al., 2006). As aforementioned some empirical studies proved that tangible has influence on customer satisfaction in overall. As Husseni A.A. (2016) studied on the relationship between service quality and customer satisfaction in the taxi companies in Nairobi and they found that service quality influence on customer satisfaction. Hence, based on the empirical studies discussed above, the researcher came with the hypothesis that: H3: Tangible has positive relationship with customer satisfaction. 2.3.4: Empathy. Empathy is defined as the “caring, individualized attention the firm provides its customer (Zeithaml et al., 2006, p. 120). The customer is treated as if he is unique and special. There are several ways that empathy can be provided: knowing the customer’s name, emergency, his preferences and his needs. Many small companies use this ability to provide customized services as a competitive advantage over the larger firms (Zeithaml et al., 2006). This dimension is also more suitable in industries where building relationships with customers ensures the firm’s survival as opposed to “transaction marketing” (Andaleeb& Conway, 6|Page

2006). Thus, in the context of quick service platform, empathy may not be so applicable where customers look for quick service and the queues at the counters are long. However, in a ride sharing industry, empathy may be important to ensure customer loyalty as the server knows how the customer likes his or her service. Empathy in the context of ride sharing platform can be demonstrated through showing concern in times of service failure and providing service recovery or going out of the way to meet a customer’s special requirements, for instance, providing fast service and knowing he or she will go back. To show empathy drivers should go earlier at the customer’s pick up place. H4: Empathy has positive relationship with customer satisfaction 2.3.5: Responsiveness. Responsiveness means “is the willingness to help customers and provide prompt service at once” (Zeithaml et al., 2006, p. 117). This factor is concerned with dealing with the customer’s complaints, requests, and questions promptly and attentively. A firm is known to be responsive when it communicates with its customers to answers their questions or have their problems dealt with. To be successful, companies need to look at responsiveness from the view point of the customer rather than the company’s perspective (Zeithaml et al., 2006). H5: responsiveness has positive relationship with customer satisfaction. 2.3.6: Price Price is an important indicator of quality (Zeithaml, 1981) and led to customer value (Zeithaml, 1988). According to Turel et al. (2006) stated that the price of a product or service can affect standard of the brand. As Button and Hensher (2001) stated that price is important indicator in transportation industry which has affect the affordability between service and fares charged. Mburu (2013) found that price, relationship and value have influence on customer satisfaction in the transportation industry in Kenya. Khuong and Dai (2016) found that reliability, tangibility, promotion, responsiveness, price and satisfaction directly affected customer loyalty. IlmaKhairani and Sri RahayuHijrahHati (2017) found that

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perceived value for money, e-service quality, service quality have a positive and significant impact towards customer satisfaction. Therefore, the hypothesis of this research is: H6: Price has positive relationship with customer satisfaction. 2.3.7: Promotion & Coupon Redemption As Lovelock and Wright (2002) stated that promotion is taken to persuade the target customers on how the consumer make decision to buy a product or service. Through, promotion activities companies can influence customer’s thinking, likings, emotions while purchasing the products or services. In this study, we use coupon redemption as one of tool of sales promotion because ride-sharing services are giving such promotion via mobile application. Promotion and price are elements of marketing mix and some studies proved that there is a relationship between marketing mix and customer satisfaction (Yelkur, 2000). Kumar and Kumar (2016) research on the factors influencing the consumers selecting cab and he found that redeem coupons has influence in selecting cab services. H7: Promotion& Coupon Redemption have a positive relationship with customer satisfaction. 2.3.8: Comfort According to Litman (2008) service comfort means the high level of service such as seats, space, journeys, and air conditioning. Some researcher in public transportation stated that comfort is an important factor need to consider in this industry (Samson and Thompson, 2007). As Budiono (2009) found that comfort is one of the most influence factor on customer satisfaction of public transport. H8: Comfort has positive relationship with customer satisfaction.

2.4: Conceptual Framework

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Reliability

Responsibility

Assurance

Empathy Customer Satisfaction Tangibility

Price

Promotion

Comfort

Figure 1: Conceptual Framework

CHAPTER THREE: METHODOLOGY AND PROCEDURES

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3.1: Research Design In this study both qualitative and quantitative research method has been adopted. Quantitative research exposes the numerical representation and manipulation of observations for the purpose of describing and explaining the observations (Sukamolson, 2014). This study will outline the factors influencing customer satisfaction (CS) in ride sharing services in Bangladesh. It is appropriate to categorize this research as exploratory research. Exploratory research is taken to clarify ambiguous situations or discover ideas that have to be identified for potential business opportunities (Zikmund, Babin, Carr, & Griffin, 2010). This study has focused on identifying the factors that may affect Customer Satisfaction. Both primary and secondary data have been used to complete this report. Besides, survey questionnaire is chosen to identify and examine the factors that affect Customers satisfaction regards ride sharing services in Bangladesh. 3.2: Sampling Design Sampling design is the ultimate technique for researchers to collect accurate information from the right people, right time and right location for research questions. 3.2.1: Target Population Target population was defined as the entire group in which researcher is interested in and wishes to draw a conclusion (Hitzig, 2009). People who have been using ride sharing services in Bangladesh will be the target population. This particular population is chosen because they have been making frequent interaction with ride sharing service providing stuffs and have better understanding and evaluations on the service quality delivered by ride sharing services companies. The age level of target population is 18 years old and above, because they possess sufficient spending power on travelling. Hence, they are the best respondents to collect information for intended study.

3.2.2: Sampling Frame and sampling location

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Sampling frame is “The actual set of units from which samples are being selected”. In other words, all units that have been included in the sampling frame have an equal chance to be selected as respondents (“Sampling Frames,” 2012). Nevertheless, there is no sampling frames for this study due to resource limitation, thus this study cannot be generalized. For sampling location, questionnaire has been distributed to the respondent via both online and personally who are the residents of Dhaka City due to the convenience of people and information reliability. 3.2.3: Sampling Element The travelers who fall in the age range of 18 years old and above and residence of Dhaka city have been selected as sampling elements in this study because they are able to make decision by themselves and possess the ability to rate on the quality of service. Travelers below 18 years old are not entitled to take part. 3.2.4: Sampling Technique In this research I have used non probability sampling techniques because it is not possible for researchers to collect data from all travelers. Non-probability technique is chosen when all the population cannot be reached (Saunders, Lewis, & Thornhill, 2009). Specifically, judgment and convenience sampling method have been used to select the respondents who are relevant and compatible to the purpose of study. To acquire representative samples we can use judgment and convenience sampling technique (James, 1997). 3.2.5: Sample Size The larger of the sample’ size, the lower the likely errors to generalize the population of study (Saunders, Lewis, & Th...