Ustomer Satisfaction of Latest IPhone - Assignment Example

Explore and critically evaluate the satisfaction of latest iPhone (iPhone 5s) Table of Contents Table of Contents 2 Introduction, background, rationale 4 Literature review 5 Customer Satisfaction for Smartphone 5 Research Question 8 Research Methodology 9 Analysis and results 10 Demographic Analysis 10 Factor Analysis 12 Conclusions, recommendations and limitations 18 Reference List 20 Appendices 23 Appendix 1: Blue print questionnaire 23 Appendix 2: Close-Ended Survey 23 Appendix 3: Responses of Respondents 25 List of Tables & Figures Table No. Table Name Page No. 2 KMO and Bartletts Test 13 3 Communalities 14 4 Total Variance Explained 15 6 Rotated Component Matrix 17 Figure No. Figure Name Page No. 1 Customer Satisfaction 6 2 Gender Distribution 11 3 Age Distribution 12 4 Education Distribution 12 5 Screen Plot 16 6 Component Plot 18 Introduction, background, rationale Previous research results show that context of consumer behaviour and customer satisfaction towards cellular phones with state of art technology integration is being driven by number of factors (Gerogiannis, Papadopoulou and Papageorgiou, 2012). Generally, cellular phones with state of art technology are being termed as Smartphone. Companies like Apple, Nokia, Samsung, HTC and others have upgraded Smartphone with the help of integration of operating system (OS), PC like gaming experience, internet connectivity, entertainment, facilities to do professional work and many others (Gerogiannis, Papadopoulou and Papageorgiou, 2012). While conducting research on customer satisfaction towards Smartphone, Park and Chen (2007) found that majority of Smartphone users expect some common benefits such as low cost of purchase, fast internet connectivity, large screen, high processing speed with the help of latest OS, easy to access social networking sites, gaming & movie watching and presence of applications that can help them to do professional tasks. On the other hand, Park and Lee (2011) conducted exploratory factor analysis and regression analysis to identify factors that can boost satisfaction among Smartphone users. According to Park and Lee (2011), customers are ready to pay additional money in order to buy Smartphone from Apple, Samsung and Nokia. Rather, these customers perceive having high priced Smartphone with full of specifications can increase their social status among peer group (Gerogiannis, Papadopoulou and Papageorgiou, 2012). According to Park and Lee (2011), satisfaction of Smartphone users is being directed by three factors, 1- instant connectivity of internet that can help them to do social networking, e-mailing and professional works, 2- ease in operating different applications in Smartphone and interactivity of user-device interface and 3- presence of latest OS that can help them to access range of free applications and execute tasks in responsive manner. Papageorgiou (2011) used Fuzzy Cognitive Map (FCM) in order to develop process map for customer satisfaction. On the other hand, Gerogiannis, Papadopoulou and Papageorgiou (2012) also emphasized on FCM in order to develop process map for customer satisfaction among Smartphone users. Various research scholars conducted research on identifying factors that can influence satisfaction level among Smartphone users but none of them ever tried to conduct similar kind of study for particular Smartphone brand. According to Gerogiannis, Papadopoulou and Papageorgiou (2012), Apple iPhones are respected among Smartphone users due to its superior performance, brand credibility, technological specifications, performance of operating system and many others. Surprisingly, very few researchers have tried to conduct research for understanding customer satisfaction regarding Apple iPhones. Due to above mentioned reasons; gap in the literature regarding customer satisfaction for Smartphone has been created. In such context, in order to fulfil gap in literature, the study has selected the topic ‘explore and critically evaluate the customer satisfaction of latest iPhone (iPhone 5s)’. Doing research on the topic will help the study to identify factors that can influence satisfaction level among users for particular Smartphone brand (Apple iPhone). Literature review According to Gerogiannis, Papadopoulou and Papageorgiou (2012), with the increase in technological awareness, users compare Smartphone of different brands with the help technological specifications and functional features. In such context, functional features and technical specifications of Apple iPhone 5s can be explained in the following manner. iPhone 5s is being positioned as next generation Smartphone by Apple (GSM Arena, 2014). As part of iPhone family, the Smartphone is being embedded with high tech features like 4G Network, metal body, capacitive and large touch screen, DC-HSDPA data, 8 MP camera, upgradable to iOS 7.1, Dual-core 1.3 GHz Cyclone processor, safari browser and A-GPS support service (GSM Arena, 2014). Consideration of research works of Gerogiannis, Papadopoulou and Papageorgiou (2012) reveals the fact that customer satisfaction towards Apple iPhone 5s can be directed by any of the mentioned features. However, further researcher is needed in order to select specific factors that can influence customer satisfaction towards Apple iPhone. Before doing so, the study will discuss previous research works of different scholars in order to understand dynamics of customer satisfaction regarding use of Smartphone. Customer Satisfaction for Smartphone Gruca and Rego (2005) defined customer satisfaction as psychological state of customers driven by cognitive assessment of optimality of product or service benefits as against their expectations. In simple words, customers compare the benefits availed by purchasing a particular product as against cost being incurred in order to purchase the product. If they find benefits availed by purchasing a particular product surpasses cost being incurred, then probability of getting satisfied increases for customers (Gruca and Rego, 2005). On the other hand, customers expect certain benefits from particular product and meeting these expectations can infuse customer satisfaction. Relativity of customer satisfaction is being directed by such as product attributes, marginalization of gap between expected and perceived product quality, superior after sales service, superior basic performance of the product, augmented benefits and discounts being offered by sellers. Jeon and Choi (2012) used the following model in order to highlight origin and end outcome of customer satisfaction. Fig 1: Customer Satisfaction (Source: Jeon and Choi, 2012) According to the above model, customer satisfaction is being generated through two types of performance parameters such as interaction quality and outcome quality. Interaction quality- for Smartphone, customers interact with the brand through promotions, previous experience of using, product review and peer group suggestions regarding purchase of the product. While purchasing high priced Smartphone with high end technical specifications, customers tend to ask retailers to illustrate benefits of the product (Ling, Hwang and Salvendy, 2006). With the help of mentioned activities, customers develop expectation regarding performance quality and benefits being offered by particular Smartphone. Outcome quality- after using the Smartphone, customers compare benefits of the product as against price being paid to purchase the product. Customer satisfaction is being generated if perceived benefits and qualities of the Smartphone have close significant amount of symmetry with expected benefits and qualities of phone (Chang, Chen and Zhou, 2009; Chen, Park and Putzer, 2010). According to Licoppe and Inada (2006), customers for Smartphone can be segmented on the basis of their income level, brand preference and usage pattern. For example, customers with low disposable income and no specific brand preference will go for low end Smartphone from relatively small level brands. However, customers with sufficient disposable income, selective brand preference and requirement for using the Smartphone in multipurpose manner, will go for high end brands like Apple (Patel, 2014). Therefore, it can be assumed that customers for Apple iPhone 5s belong to certain homogeneous category being classified in terms of income level, brand preference and usage pattern. Versakalo et al. (2010) pointed out that expectation level of customers get increased for high end Smartphone. Therefore, it becomes difficult for high end Smartphone makers to increase customer satisfaction via establishing trade-off between expected and perceived benefits among customers regarding different specifications of the phone. Patel (2014) pointed out that that customer satisfaction for particular Smartphone is being directed by either psychological level benefits or functional level benefits. Psychological benefits- high end Apple or Samsung Smartphone are being promoted as status symbol and necessary tool for doing work and professional activities. These markets position their high end offering as life style element and ideal working tool for young professionals. While purchasing high end Smartphone of Apple, customers might get satisfied by the association of the product to brand aesthetics of Apple. However, Heo et al (2009) argued that customers perceive Smartphone as low involvement and high utility product. Therefore, it is improbable that a customer of Apple or Samsung only get satisfied by brand aesthetics and perceived social status of having the phone (Fekri, Aliahmadi and Fathian, 2009). Functional level benefits- Chen, Park and Putzer (2010) pointed out that integration advanced technological characteristics in the Smartphone can actually satisfy customers. For example, external features like colour, weight, metallic look, slab like design and size of the Smartphone can influence purchase decision of customers. Bhatnagar and Ghosh (2010) and Cortimiglia, Ghezzi and Renga (2010) stated that Smartphone users put significant importance on choice of OS such as Android, iOS, windows and others. With increase in processing capabilities and speed of OS, ease of enjoying games, online video watching, movie watching and doing professional tasks through Smartphone gets increased. Chin and Yang (2009) and Liao, Li and Xu (2008) stated that advertisers use promote social media advertisements and m-commerce offering though Smartphone applications. For example, Apple iPhones have range of free and paid applications that can be customized by customers as par their requirements. There are customers, who purchase Smartphone only for accessing internet, social networking, playing games, watching movies or online videos in portable manner (Xu, Liao and Li, 2008). Patel (2014) found ten different product attributes that are most significant in directing satisfaction among users of Smartphone such as, 1- metallic look of the phone, 2- screen size, 3- camera resolution, 4- battery life, 5- processing speed of OS, 6-internet accessibility, 7-office application, 8- GPS/Maps, 9- gaming applications and 10- availability movie watching and other entertainment options. Research Question It is evident from the above discussion that customer satisfaction for particular Smartphone product depends heavily on technical specifications and functional benefits of the product. It is evident from the research works of Patel (2014) that relative index for customer satisfaction is pretty high for Smartphone. Ten distinct technical specifications and functional factors are being identified that can influence customer satisfactions regarding iPhone 5s. In iPhone 5s, Apple can differentiate its offering by integrating or expanding features in selected technical specifications and functional factors but basic architectures of these features will be the same. Technical specifications and functional factors of the Smartphone such as metallic look of the phone, screen size, camera resolution, battery life, processing speed of OS, internet accessibility, office application, GPS/Maps, gaming applications and availability movie watching facilities will be considered while developing research hypothesis. Most suitable predictor from these ten factors will be decided on the basis of statistical analysis. Research questions for study can be defined in the following manner; What are the pertinent factors that may influence customer satisfaction of latest iPhone (iPhone 5s)? How the pertinent factors can influence customer satisfaction of latest iPhone (iPhone 5s)? Based on above research questions, research objectives for the study can be briefed in the following manner. 1. To identify pertinent factors that may influence customer satisfaction of latest iPhone (iPhone 5s). 2. To understand how the pertinent factors can influence customer satisfaction of latest iPhone (iPhone 5s). First two research questions need to be addressed in measurable manner while the last question can be addressed on the basis of qualitative merit of variables. In order to address first two research questions, the study will reduce dimensions of selected technical specifications and functional factors that may influence customer satisfaction for latest iPhone (iPhone 5s). Research Methodology Sekaran and Bougie (2009) stated that a research study is incomplete without incorporation of proper research methodology. According to these research scholars, the research can be conducted either following positivism or phenomenology as research philosophy. As the research problem is definitive in nature and study needs to address research problem in terms of quantitative parameter. Therefore, positivism will be used as research philosophy. Saunders, Lewis and Thornhil (2012) identified two types of research approach that can be used by researchers to conduct study deductive and inductive approach. As the study is trying to limit broadness of research problems into specific assumptions, therefore, the study will use deductive research approach for the study. Saunders, Lewis and Thornhil (2012) identified two types of research strategy that can be used in order to conduct research such as qualitative strategy and quantitative research strategy. Qualitative strategy- in this research strategy, analyzing root cause of research problem in non numeric manner is the key objective for researchers. Generally, non-numeric methods like case study development, content analysis, open-ended interview and ethnography are being used for analyzing research problem on the basis of qualitative merit of variables. However, in this study context, research problems need to be addressed in numeric and measurable manner. Therefore, using qualitative research strategy will not help the researcher to address research problem in accurate manner. Quantitative strategy- in this research strategy, relationship between research variables are being tested through quantitative parameters and research problems being addressed in measurable manner. As the research problem in the study also needs quantitative explanation, therefore, the study will use quantitative strategy for addressing research problems. According to Saunders, Lewis and Thornhil (2012), two types of time horizon can be used by researchers for conducting research such as longitudinal and cross-sectional time panel. The researcher is addressing the research problem in context to specific time coordinate and doing longitudinal research is cost and time intensive process. Therefore, the study will use cross-sectional time panel for conducting research. In order to address research problem in convincing manner, the study will use both primary and secondary data. In order to collect secondary data, the researcher will use academic peer-reviewed journals, books, magazines, online articles, business reports and newspaper reports. On the other hand, primary data will be collected through sample survey backed close ended questionnaire. Due to specific and definitive aspects of the research problem, there is hardly any scope of using other research techniques such as experiments, case study development, testing, observation, action research or focus group interview. In close-ended questionnaire survey, 5 point Likert scale will be used to assign values to technical specifications and functional factors that are being selected for the study. In 5 point Likert scale, high score will be assigned for most important option while lowest score will be assigned for least important option. As part of sampling strategy, convenience sampling (non-probabilistic approach) will be used for selecting sample size for close ended questionnaire survey. Users of Apple iPhone 5s will be tracked from fan community pages in Facebook. These community members will be asked to participate in sample survey process. Using convenience sampling will help the researcher to conduct sample survey in cost and time efficient manner. Total sample size of 60 users of Apple iPhone 5s will be selected from community page in Facebook. These community members will be invited to participate in sample survey and close ended questionnaire will be e-mailed to them (Saunders, Lewis and Thornhil, 2012). They will be requested to return filled up questionnaire to mentioned address in the e-mail. As part of statistical input, exploratory factor analysis will be used for selecting pertinent technical specifications and functional factors that may influence customer satisfaction for iPhone 5s. From ethical perspective, confidentiality regarding identity of respondents will be maintained in the study and objective of conducting this research will be communicated to respondents’ prior doing sample survey. Analysis and results Demographic Analysis Throgh qualifying question, 80 respondents are being selected. Out of this 80 respondents, 60 respondents were ready to participate in the close ended sample survey process. In this way, sample size of 60 has been reached. Demographic analysis of sample population can be presented in the following manner. Figure 1: Gender Distribution It is evident from the pie chart that majority of participants in sample survey were male (65%) while only 35% of participants in sample survey were female. Figure 2: Age Distribution It is evident from the above diagram that 75% of respondents belong to the age group of 21years to 30years. Therefore, it can be said that relatively young segment in the society participated in close ended survey process. Only 3% of respondents were less than 20 years old while 22% of respondents were more than 30 years old. Figure 3: Education Distribution Factor Analysis From mathematical perspective, selected 10 different technical specifications and functional factors related to iPhone 5s may belong to polynomial geometric space. N-dimensional rotation and matrix algorithm can be created with selected factors in order to identify their effect on customer satisfaction. Considering vector algebra concept, it is improbable to expect that all the selected factors equally influence customer satisfaction towards Apple iPhone 5s. In such context, factor analysis based on principal component method will be used to reduce dimensions of data and identify most important factors that may influence customer satisfaction towards iPhone 5s. In order to check suitability of factor analysis for given research problem, KMO and Bartletts test has been conducted. Table 1: KMO and Bartletts Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .513 Bartletts Test of Sphericity Approx. Chi-Square 95.124 df 45 Sig. .000 According to Kaiser-Meyer-Olkin Measure of Sampling Adequacy value, 51.3% variance in customer satisfaction is being directed by underlying factors. Variance greater than 50% identifies requirement of doing factor analysis (IBM, 2014). Significance level of Bartletts Test of Sphericity is lower than 0.05 and that ensures suitability of doing factor analysis. Table 2: Communalities Initial Extraction Metallic look of the phone 1.000 .827 Screen size 1.000 .587 Camera resolution 1.000 .655 Battery life 1.000 .681 Processing speed of OS 1.000 .534 Internet accessibility 1.000 .835 Professional application 1.000 .613 Gaming applications 1.000 .420 Movie Video Streaming 1.000 .404 GPS Maps 1.000 .705 Extraction Method: Principal Component Analysis. Eigen value of 1 is being selected as cut off parameter for initial factor extraction. Initial communalities values are measuring correlation between particular explanatory variable and rest of the alternatives. Greater than or equal to 0.5 being selected as accepted range of variance. Variance greater than 0.5 will indicate that particular explanatory variable will be good enough to be included in factor solution. In such context, yellow marked variables such as metallic look of the phone, screen size, camera resolution, battery life, processing speed of OS, internet accessibility, professional application and GPS maps are being selected as important predictors in initial factor solution. Table 3: Total Variance Explained Component Initial Eigenvalues Extraction Sums of Squared Loadings Total % of Variance Cumulative % Total % of Variance Cumulative % 1 2.231 22.311 22.311 2.231 22.311 22.311 2 1.535 15.353 37.663 1.535 15.353 37.663 3 1.351 13.508 51.171 1.351 13.508 51.171 4 1.144 11.443 62.614 1.144 11.443 62.614 5 .917 9.168 71.783 6 .781 7.814 79.597 7 .729 7.288 86.885 8 .646 6.456 93.340 9 .443 4.426 97.766 10 .223 2.234 100.000 Eigen values greater than 1 is being selected as cut-off measures for selecting most important explanatory variables that may influence customer satisfaction regarding iPhone 5s. Four underlying factors are being selected that may influence 62.6% variance in customer satisfaction (IBM, 2014). Figure 4: Screen Plot However, to be more robust in terms of selection of variable, the study will use more than five factor solutions. Table 4: Rotated Component Matrix Component 1 2 3 4 Metallic look of the phone .890 .075 -.146 .084 Screen size -.146 .364 -.658 -.014 Camera resolution .326 -.126 .100 .723 Battery life -.152 .153 .791 -.090 Processing speed of OS .120 .301 .729 .387 Internet accessibility .809 .366 .213 -.047 Professional application .218 .738 -.079 .122 Gaming applications .173 .591 .201 -.010 Movie Video Streaming -.095 .487 -.107 -.382 GPS Maps -.309 .115 -.134 .760 Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. a. Rotation converged in 8 iterations. Varimax rotation (maximizing sum of variances of squared factor loadings) is being used to rotate factors (IBM, 2014). Value greater than or equal to 0.70 is being selected as accepted level. Significant factors are being marked in yellow. Seven technical specifications and functional factors such as metallic look of the phone, camera resolution, battery life, processing speed of OS, internet accessibility, professional application and GPS Maps are being selected as most important predictors for customer satisfaction towards iPhone 5s. Important explanatory factors are being depicted in 3D geometric space diagram. Figure 5: Component Plot Conclusions, recommendations and limitations The study has conducted in order to address following research questions. What are the pertinent factors that may influence customer satisfaction of latest iPhone (iPhone 5s)? How the pertinent factors can influence customer satisfaction of latest iPhone (iPhone 5s)? Seven technical specifications and functional factors such as metallic look of the phone, camera resolution, battery life, processing speed of OS, internet accessibility, professional application and GPS Maps are being selected as most important predictors for customer satisfaction towards iPhone 5s. Most of the respondents were working professional and they look for long term benefits of from iPhone phone. Gaming, entertainment facility and screen size of the phone might be classified as immediate attractor but these factors cannot direct customer satisfaction in long term perspective. On the other hand, high processing speed of OS and easy internet accessibility help users of iPhone 5S to do their professional work or communicate with others in responsive manner. Therefore, customer satisfaction for iPhone 5S is being directed by long term benefits of particular technical specifications or functionalities associated with the phone. From marketing perspective, it is being recommended that marketer should try to communicate long term benefits of different iPhone 5S features like metallic look of the phone, camera resolution, battery life, processing speed of OS, internet accessibility, professional application and GPS Maps. Superior after sales service regarding up gradation of processing speed of OS, different low priced internet use plan, improvement of professional application and GPS services should be provided by the company in order to satisfy customers in sustainable manner. Limitations of this research can be briefed in the following manner; Small sample size selected through convenience sampling will not be sufficient to represent characteristics of entire population. Using small sample size and limited numbers of factors might not be suitable for exploratory factor analysis. Reference List Bhatnagar, A. and Ghosh, S., 2010. A latent class segmentation analysis of E-Shoppers. Journal of Business Research, 57(7), pp. 758-767. Chang, Y., Chen, C. and Zhou, H., 2009. Smart phone for mobile commerce. Computer Standards & Interfaces, 31(4), pp. 740-747. Chen, J., Park, Y. and Putzer, G., 2010. An examination of the components that increase acceptance of smartphones among healthcare professionals. Electronic Journal of Health Informatics, 5(2), pp. 1-12. Chin, C. C. and Yang, J. H., 2009. An efficient three-party authenticated key exchange protocol using elliptic curve cryptography for mobile-commerce environments. Journal of Systems and Software, 82(9), pp. 1497–1502. Cortimiglia, M., Ghezzi, A. and Renga, F., 2010. Mobile Applications and Their Delivery Platforms. IT Professional , 13(5), pp. 51 - 56. Fekri, R., Aliahmadi, A. and Fathian, M., 2009. Predicting a model for agile NPD process with fuzzy cognitive map: The case of Iranian manufacturing enterprises. International Journal of Advanced Manufacturing Technology, 41(1-2), pp. 1240-1260. Gerogiannis, V. C., Papadopoulou, S. and Papageorgiou, E. I., 2012. Identifying factors of customer satisfaction from smartphones: A fuzzy cognitive map approach. Thessaloniki: International Conference on Contemporary Marketing Issues (ICCMI). Gruca, T. S. and Rego, L. L., 2005. Customer satisfaction, cash flow, and shareholder value. Journal of Marketing, 69(3) pp. 115-30. GSM Arena., 2014. Apple iPhone 5s. [online] Available at: [Accessed 3 April 2014]. Heo, J., Ham, D., Park, S., Song, C., and Yoon, W., 2009. A framework for evaluating the usability of mobile phones based on multi-level, hierarchical model of usability factors. Interacting with Computers, 21(4), pp. 263-275. IBM, 2014. Factor Analysis. [online] Available at: [Accessed 5 April 2014]. Jeon, H. and Choi, B., 2012. The relationship between employee satisfaction and customer satisfaction. Journal of Services Marketing, 26(5), pp. 332-341. Liao, S. Y., Li, A. and Xu, J. J., 2008. Combining empirical experimentation and modeling techniques: A design research approach for personalized mobile advertising applications. Decision Support Systems, 4(3), pp. 710–724. Licoppe, C. and Inada, Y., 2006. Emergent uses of a multiplayer location-aware mobile game: The interactional consequences of mediated encounters. Mobilities, 1(1), pp. 39–61. Ling, C., Hwang, W. and Salvendy, G., 2006. Diversified users’ satisfaction with advanced mobile phone features. Universal Access in the Information Society, 5(2), pp. 239-249. Papageorgiou, E. I., 2011. Review study on fuzzy cognitive maps and their applications during the last decade. Taiwan: International Conference on Fuzzy Systems. Park, B. and Chen, J., 2007. Acceptance and adoption of the innovative use of smartphone. Industrial Management & Data Systems, 107(9), pp. 1349-1365. Park, B. and Lee, K., 2011. A pilot study to analyze the effects of user experience and device characteristics on the customer satisfaction of smartphone Users. Communications in Computer and Information Science, 151(2), pp. 421-427. Patel, R. K., 2014. A study on consumer behavior and opportunities for nokia smart-phones in india. GALAXY International Interdisciplinary Research Journal, 2 (1), pp. 68-97. Saunders, M., Lewis, P. and Thornhil, A., 2012. Research methods for business students. 6th ed. New Jersey: FT/Prentice Hall. Sekaran, U. and Bougie, R., 2009. Research methods for business. 5th ed. Chichester, West Sussex: John Wiley& Sons. Versakalo, H., Lopez-Nicolas, C., Molina-Castillo, F. and Bowman, H., 2010. Analysis of users and non-users of smartphone applications. Telematics and Informatics, 27(3), pp. 242-255. Xu, K. J., Liao, S. S. and Li, Q., 2008. Combining empirical experimentation and modeling techniques: A design research approach for personalized mobile advertising applications. Decision Support Systems, 44(3), pp. 710-724. Appendices Appendix 1: Blue print questionnaire Qualifying Questions: Are you experienced in using Apple iPhone 5s? Yes No Appendix 2: Close-Ended Survey Fill up the questionnaire by tick marking preferred options (√). No. Factors that decide customer satisfaction Least important (Code Value=1) Slightly important (Code Value=2) Neutral (Code Value=3) Somewhat important (Code Value=4) Most important (Code Value=5) 1. Metallic look of the phone 2. Screen size 3. Camera resolution 4. Battery life 5. Processing speed of OS 6. Internet accessibility 7. Professional application 8. Gaming applications 9. Movie/Video Streaming 10. GPS/Maps Demographic data Appendix 3: Responses of Respondents Read More