Examining the impact of customer satisfaction with after-sales service on corporate profitability
Subject Areas : Statistical Modeling
Shahriar Soltani
1
,
Farzad Movahedi Sobhani
2
,
Seyed Esmaeil Najafi
3
1 - Islamic Azad university central Tehran branch ,Tehran, Iran
2 - Department of Industrial Engineering, Science and Research Branch, Islamic Azad University, Tehran, Iran
3 - Department of Industrial Engineering, Science and Research Branch, Islamic Azad University, Tehran, Iran
Keywords: Customer Satisfaction, Regression, profitability, Automotive Industry, After -Sales Services,
Abstract :
Determining the factors affecting customer satisfaction in after-sales service in various industries has been studied. However, the importance of after-sales service by considering customer demographic factors in the automotive industry and its impact on organizational profitability needed further investigation. One hundred fifty-three thousand customers referring to the automotive after-sales service network examine the effect of customer income on the satisfaction and profitability of the organization. For this purpose, a sample of 383 people was randomly selected from different clusters of customers. The structural equation model in Amos 21 software was used to test the model and research hypotheses. The RFM clustering method was used to show the preferences and demands of customers in each cluster to address behavioral dissimilarity among customers. We also calculated the effect of each factor on overall customer satisfaction and profitability by presenting a mathematical model through multivariate regression equations. The results showed that the demographic variable of customers' income effectively affects their perception of satisfaction. Also, the level of customer satisfaction has a positive relationship with the organization's profitability. Finally, through mathematical equations, the numerical effect of each of the independent variables on the dependent variables, customer satisfaction, and profitability of the organization was calculated.
[1] Gogoi, B. (2020). Service Quality Measures: How it Impacts Customer
Satisfaction and Loyalty. International Journal of Management (IJM), 11,
354–365.
[2] Zygiaris,S., Hameed,Z.,Alsubaie,M.,A& Rehman,S.U . (2022). Service
Quality and Customer Satisfaction in the Post Pandemic World: A Study of
Saudi Auto Care Industry.Front.Psychol, Vol13, https://doi.org/10.3389/
fpsyg.2022.842141.
[3]Tjahjaningsih,E.,Maskur,A.,Widyasari,S.,&Kusuma,L.(2022).
Investigating the linkages between service types and supplier relationships
in serviced environments. Advances in Economics, Business and
Management Research, volume 169.
[4] Pradnyadewi,L.P.A.,& Giantari,IG.A.K. (2022).Effect of E-Service
Quality on Customer Satisfaction and Customer Loyalty on Tokopedia
Customers in Denpasar. European Journal of Business and Management
Research, Vol7, No.2.
[5] Zamry, A.D., &Nayan, S.Md. (2020). What Is the Relationship between
Trust and Customer Satisfaction? Journal of Undergraduate Social Science
and Technology, 2.
[6] Parasuraman, A., Zeithaml, V., & Berry, L. (1994). Reassessment of
expectations as a comparison standard in measuring service quality:
implications for further research. J. Market, 58 (1), 111.
[7] Van Dyke, T., Kappelman, L., &Prybutok, V. (1997). Measuring
information systems service quality: concerns on using the SERVQUAL
questionnaire. MIS Q., 21 (2), 19e.
[8] Lee, H.,& Kim, C. (2014). Benchmarking of service quality with data
envelopment analysis. Expert Syst. Appl, 41 (8), 3761–3768.
[9] Jain, S.K., &Gupta, G., (2004). Measuring service quality: SERVQUAL
vs. SERVPERF scales. Vikalpa, 29 (2), 25–38.
[10] Soltani, S., Sobhani,F.M., & Najafi,S.E. (2021). Determining the
increased numerical value of customer satisfaction, which has been impacted
by latent and observed factors in after-sales service in the automotive
industry, based on System Dynamics Method. (A Case study in car
manufacturer). Journal of Engineering Research, https://doi.org/
10.36909/jer.12121.
[11] Murali, S., Pugazhendhi, S., & Muralidharan, C. (2016). Modeling and
investigating the relationship of after-sales service quality with customer
satisfaction, retention, and loyalty – a home appliances business case study.
J. Retailing Consum. Serv, 30, 67–83.
[12] Shokouhyar, S., Shokoohyar ,Sina., &Safari, S. (2020). Research on the
influence of after-sales service quality factors on customer satisfaction.
Journal of Retailing and Consumer Services, 56: 102-139.
[13] Smith, W. (1956). Product Differentiation and Market Segmentation as
Alternative Marketing Strategies. Journal of Marketing, 21 (July), 3-8.
[14] Newman, Emily. (2014). Effects of Demographics on customer service.
https://corp.yonyx.com/customer-service/effects-of-demographics-oncustomer-service.
[15]Toelle, Sulistyawati. (2020). The Effect of Demographics Factors on
Customer Service Quality Expectations in the Indonesian Retail Banking
Industry. International Journal of Advanced Science and Technology, Vol.
29, No. 7, (2020), pp. 5391-5405.
[16] Dabhade,N.,& Gupta,A.(2021). Does Demographics Matter in
Measuring Customer Satisfaction: Hypothetical Evidence from Indian
Telecom Sector. Indonesian Management and Accounting Research,Vol
.20,No 1. DOI: http://dx.doi.org/10.25105/imar.v20i1.7227
[17] Bowen, William, J., & Robert B. Hedges (1993). Increasing Service
Quality in Retail Banking. Journal of Retail Banking, 15 (3), 21-28.
[18] Webster, Cynthia (1989). Can Consumers be segmented based on Their
Service Quality Expectations? The Journal of Services Marketing, (2),35-
53.
[19] Stafford, Marla Royne. (1996). Demographic Discriminators of Service
Quality in the Banking Industry. The Journal of Services Marketing, 10 (4),
6-22.
[20] Thompson, A.M., & Kaminski, P. (1993). Psychographic and Lifestyle
Antecedents of Service Quality Expectations: A Segmentation Approach.
Journal of Services Marketing, 7 (4), 53-61.
[21] Gagliano,K.B., Hathcote,.J .(1994).Customer Expectations and
Perceptions of Service Quality in Retail Apparel Specialty Stores. Journal of
Services Marketing, Vol. 8 No. 1, pp. 60-
69. https://doi.org/10.1108/08876049410053311
[22] Eklof, J.A., Hackl, P.& Westlund, A. (1999). On measuring interactions
between customer satisfaction and financial results. Total Quality
Management, Vol. 10, Iss. 4/5, pp. 514-522. ISSN 1360-0613.
[23] Hart, C.W. (2007). Beating the market with customer satisfaction.
Harvard Business Review, Vol. 85, Iss. 3, pp. 30-32. ISSN 0017-8012.
[24] Li, Q. (2010). Exploring the relationship between customer-related
measures and shareholder value. Social Behavior and Personality, 38(5):
647-656.
[25] Matzler, K et al. (2004). The asymmetric relationship between attributelevel performance and overall customer satisfaction: reconsidering the importance-performance analysis. Industrial Marketing Management,.
33(4): 271- 277.
[26] Mittal, V., Anderson, E.W., Sayrak, A., & Tadikamalla, P. (2005). Dual
emphasis and the long-term financial impact of customer satisfaction.
Marketing Science, 24(4): 544-555.
[27] Schneider, B. (1991). Service quality and profits: can you have your
cake and eat it too? Human Resource Planning, Vol. 14, Iss. 2, pp. 151-157.
[28] Pourhassan Mohammad Reza, Raissi Sadigh, Hafezalkotob Ashkan.
(2020). A simulation approach on reliability assessment of complex system
subject to stochastic degradation and random shock. Eksploatacja i
Niezawodność - Maintenance and Reliability.22(2):370-379.
DOI: 10.17531/ ein.2020.2.20
[29] Westlund, A., Fornell, C. (1993). Customer satisfaction measurements
and their relationship to productivity analysis. In: Proceedings of the 8th
World Productivity Congress. Stockholm.
[30] Gupta, S.,&Zeithaml, V.(2006).Customer metrics and their impact on
financial performance. Marketing Science Journal, 25:718–739.
[31] Anderson, E.W., &Sullivan, M.W. (1993). The antecedents and
consequences of customersatisfaction for firms. Marketing Science, Vol. 12,
Iss. 2, pp. 125-143.
[32] Cheung, C.M.K., &Lee, M.K.O. (2009). User satisfaction with an
internet-based portal: an asymmetric and nonlinear approach. Journal of the
American Society for Information Science and Technology, 60(1) 111- 122.
[33] Finn, A. (2011). Investigating the nonlinear effects of e-service quality
dimensions on customer satisfaction. Journal of Retailing and Consumer
Services, 18(1) 27-37. ISSN 0969-6989.
[34] Mittal, V., Ross, W., &Baldasare, P.M. (1998). The asymmetric impact
of negative and positive attribute-level performance on overall satisfaction
and repurchase intentions. Journal of Marketing, 62(1): 33-47.
[35] Bernhardt, K.L., Donthu , N.,& Kennett, P.A.(2000).A longitudinal
analysis of satisfaction and profitability. Journal of Business Research, Vol.
47, Iss. 2, pp. 161-171. ISSN 0148-2963.
[36] Wang, J. N., Du, J., Chiu Y, L., & Li, J. (2018). Dynamic effects of
customer experience levels on durable product satisfaction: Price and
popularity moderation. Electronic Commerce Research and Applications,
28, 16-29.
[37] Klementova, J., Zavadsky, J., & Zavadska, Z. (2015). The measurement
and evaluation of the service quality through customers' satisfaction. Annals
of Warsaw University of Life Sciences. SGGW Forestry and Wood
Technology, 88, 107-111.
[38] Blut , M., Teller, C., &Floh, A. (2018). Testing retail marketing-mix
effects on patronage: a meta-analysis. J. Retailing, 94, 113–135.
[39] Arabi, M., Mansour, S., & Shokouhyar, S. (2018). Optimizing a
warranty–based sustainable product-service system using game theory.
International Journal of Sustainable Engineering, 11,330–341.
[40] Durugbo, M.C. (2019). After-sales services and aftermarket support: a
systematic review, theory and future research directions. International
Journal of Production Research, 58, 1-36.
[41] Lee, K. (2014). Attitudinal dimensions of professionalism and service
quality efficacy of frontline employees in hotels. Int. J. Hospital.
Management, 41, 140–148
[42] Carrillat, F., Jaramillo, F., & Mulki, J. (2007). The validity of the
SERVQUAL and SERVPERF scales. Int. J. Serv. Ind. Management, 18 (5),
472–490.
[43] Seth, N., Deshmukh, S., & Vrat, P. (2005). Service quality models: a
review. Int. J. Qual. Reliab. Manag, 22 (9), 913–949.
[44] Yu, W., &Ramanathan, R. (2012). Retail service quality, corporate
image, and behavioral intentions: the mediating effects of customer
satisfaction. Int. Rev. Retail Distrib. Consum. Res, 22 (5), 485–505.
[45] Parasuraman, A., Zeithaml, V.A., & Berry, L.L. (1988). Servqual: a
multiple-item scale for measuring consumer perceptions of service quality.
J. Retailing, 64 (1), 12.
[46] Bei, L.-T., & Y.-C. Chiao (2001). An integrated model for the effects
of perceived product and service quality and perceived price fairness on
consumer satisfaction and loyalty. Journal of consumer satisfaction,
dissatisfaction and complaining behavior, 14(125).
[47] Boulding, W., et al. (1993). A dynamic process model ofservice quality:
from expectations to behavioral intentions. Journal of marketing research,
30(1): 7.
[48] Taylor, S.A. & Baker, TL. (1994). An Assessment of the Relationship
between Service Quality and Customer Satisfaction in Formation of
Consumers' Purchase Intentions. Journal of Retailing, 70, 63-178.
[49] Gotlieb, J. B., et al. (1994). Consumer satisfaction and perceived
quality: complementary or divergent constructs? Journal of applied
psychology, 79(6): 875.
[50] Ryu, K. & H. Han. (2011). New or repeat customers: How does the
physical environment influence their restaurant experience? International
Journal of Hospitality Management, 30(3): 599-611.
[51] Izogo, E. E. & I.-E. Ogba (2015). Service quality, customer satisfaction,
and loyalty in the automobile repair services sector. International Journal of
Quality & Reliability Management, 32(3): 250-269.
[52] El-Adly, M. I. (2018). Modeling the relationship between hotel
perceived value, customer satisfaction, and customer loyalty. Journal of
Retailing and Consumer Services, https://doi.org/10.1016/
j.jretconser.2018.07.007.
[53] Lussier, B., & Hartmann, N. N. (2017). How psychological
resourcefulness increases salesperson's sales performance and the
satisfaction of their customers: Exploring the mediating role of customeroriented behaviors. Industrial Marketing Management, 62, 160-170.
[54] Fazli, A. (2017). Multi-index pre-processing using data mining (Case
study: Third-party logistics selection in the procurement of warranty service
of electronic equipment manufacturing company). Modern Researches in
Decision Making, 2: autumn.
[55] Kasiri, L.A., Cheng K, T. G., Sambasivan, M., & Sidin, S. M. (2017).
Integration of standardization and customization: Impact on service quality,
customer satisfaction, and loyalty. Journal of Retailing and Consumer
Services, 35, 91-97.
[56] Hwang, Y., &Mattila, A. S. (2018). Is It My Luck or Loyalty? The Role
of Culture on Customer Preferences for Loyalty Reward Types. Journal of
Travel Research, 57, 769-778.
[57] Chicu ,D., Del Mar Pàmies ,M., Ryan ,G., &Cross, C. (2018). Exploring
the influence of the human factor on customer satisfaction in call centers.
BRQ Business Research Quarterly, 22, 83-95.
[58] Shen, J., & Tang, C. (2018). How does training improve customer
service quality? The roles of transfer of training and job satisfaction.
European Management Journal, 36, 708-716.
[59] Shurair, A., &Pokharel, S. (2019). Stakeholder's perception of service
quality: a case in Qatar. Quality Assurance in Education, 27, 493-510.
[60] Li, X. & K. Jarinto (2012). Service is power: exploring service quality
in Hotel's business, Yunnan, China. International Business Research, 5(5).
[61] Kaura, V., et al. (2015). Service quality, service convenience, price and
fairness, customer loyalty, and the mediating role of customer satisfaction.
International Journal of Bank Marketing, 33(4): 404-422.
[62] Shokohyar, S., Shokoohyar, S., Raja, N., &Gupta, V. (2021). Promoting
fashion customer relationship management dimensions based on customer
tendency to outfit matching: mining customer orientation and buying
behavior. Int. J. Appl. Decis. Sci, 14 (1).
[63] Nurnatasha, M.Y., & Nayan,S.Md.(2020).Review on customer
satisfaction. Journal of Undergraduate Social Science and Technology,2.
[64] Wang, Q., Voss, C., & Zhao, X. (2019). Deployment Strategies for
Service Innovation. IEEE Transactions on Engineering Management, 66,
514 – 528.
[65] Joly, M.P., Teixeira,J. J., Patrício, L.,& Sangiorgi ,D .(2019).
Leveraging service design as a multidisciplinary approach to service
innovation. Journal of service management, 30, 681-715.
[66] Bandaru, S., Gaur, A., Deb, K., Khare, V., Chougule, R.,
&Bandyopadhyay, N. (2015). Development, analysis, and applications of a
quantitative methodology for assessing customer satisfaction using
evolutionary optimization. Applied Soft Computing, 30, 265-278.
[67] Paria Soleimani, Ali Narvand, Sadigh Raissi (2013). Online Monitoring
of Auto-correlated Linear Profiles via Mixed Model, International Journal of
Manufacturing Technology and Management, 27(4/5/6): 238-250.
[68] Loveman, G. W. (1998). Employee satisfaction, customer loyalty and
financial performance: An empirical examination of the service–profit chain
in retail banking. Journal of Services Research, 1, 18–31.
[69] Reza G. Saeidi, Gholam R. Amin, Sadigh Raissi, Said Gattoufi, (2013),
An efficient DEA method for ranking woven fabric defects in textile
manufacturing, The International Journal of Advanced Manufacturing
Technology, 68, (1-4): 349-354
[70] Lin, Z., &Vlachos, I. (2018). An advanced analytical framework for
improving customer satisfaction: a case of air passengers. Transportation
Research Part E: Logistics and Transportation Review, 114, 185-195.
[71] Batt, R. (2002). Managing customer services: Human resource practices
quit rates and sales growth. Academy of Management Journal,45(3):587-
597. ISSN 0001- 4273. DOI:10.2307/3069383.
[72] Silvestro, R., &Cross, S. (2000). Applying the service profit chain in a
retail environment: challenging the satisfaction mirror. International Journal
of Service Industry Management, 11(3): 244-268.
[73] Yee, R.W.Y., Yeung, A.C.L., &Cheng, T.C.E. (2011). The serviceprofit chain: an empirical analysis in high-contact service industries. International Journal of Production Economics,130(2): 236-245. ISSN 0925-
5273.
[74] Keisidou, E., Sarigiannidis, L., &Maditinos, M. (2013). Customer
satisfaction, loyalty and financial performance: A holistic approach of the
Greek banking sector. International Journal of Bank Marketing, 31, 259–
288.
[75] Nayebzadeh, S., Jalaly, M., & Shamsi, H. M. (2013) The relationship
between customersatisfaction and loyalty with the bank performance in Iran.
International Journal of Academic Research in Business and Social Sciences,
3, 114.
[76] A Apornak, S Raissi, A Keramati, K Khalili-Damghani (2020). Human
resources optimization in hospital emergency using the genetic algorithm
approach, International Journal of Healthcare Management 14 (4): 1441-
1448.
[77] Kim, W. H., Cho, J. L., & Kim, K. S. (2019). The relationships of wine
promotion, customer satisfaction, and behavioral intention: The moderating
roles of customers' gender and age. Journal of Hospitality and Tourism
Management, https://doi.org/10.1016/j.jhtm.2019.03.001.
[78] Anderson, E.W., Fornell, C., &Lehmann, D.R. (1994). Customer
satisfaction, market share, and profitability - findings from Sweden. Journal
of Marketing, Vol. 58, Iss. 3, pp. 53-66.
[79] Shokoohyar, S. (2018a). Ride-sharing platforms from drivers'
perspective: evidence from Uber and Lyft drivers. International Journal of
Data and Network Science, 2 (4), 89–98.
[80] Agard, B., Morency, C., &Trepanier, M. (2006). Mining public
transport user behavior from smart card data. IFAC Proceedings, 39 (3),
399–404.
[81] Ghazanfari, M., Jafari, M., &Rouhani, S. (2011). A tool to evaluate the
business intelligence of enterprise systems. Sci. Iran, 18 (6): 1579–1590.
[82] Hosseini, S.M., Maleki, A., & Gholamian, M.R. (2010). Cluster analysis
using data mining approach to develop CRM methodology to assess
customer loyalty. Expert Syst Appl, 37 (7): 5259–5264.
[83] Mirzaei,E.,Bashiri,M.,&Shams Shemirani,H .(2019). Exact algorithms
for solving a bi-level location–allocation problem considering customer
preferences. Journal of Industrial Engineering International, 15:423–
433,https://doi.org/10.1007/s40092-018-0302-6.
[84] Wu, H.-H., Chang, E.-C., Lo, & C.-F. (2009). Applying RFM Model
and K-Means Method in Customer Value Analysis of an Outfitter, Global
Perspective for Competitive Enterprise, Economy and Ecology, Springer,
London, ISBN 978-1848827615: 665–672.
[85]Abdi,F.,& Abolmakarem,S.(2019).Customer Behavior Mining
Framework (CBMF) using clustering and classification techniques.Journal
of Industrial Engineering International, 15 (Suppl1): S1–S18.
[86] Eklof ,j., Podkorytova,ogla.,& Malova,a. (2020). Linking customer
satisfaction with financial performance: an empirical study of Scandinavian
banks. Total Quality Management & Business Excellence, 31:15-16, 1684-
1702,
[87] Kelley Blue Book. (2020). Average New-Vehicle Prices up Nearly 3%
Year-Over-Year in February 2020. https://www.prnewswire.com/news
/kelley-blue-book/.
[88] Kim, K., &Byon, K. (2018). A mechanism of mutually beneficial
relationships between employees and consumers: a dyadic analysis of
employee–consumer interaction. Sport Management, Rev.
https://doi.org/10.1016/j.smr.2018.01.003.
[89] Saccani, N., Visintin, F., &Rapaccini, M. (2014). Investigating the
linkages between service types and supplier relationships in serviced
environments. Int. J. Prod. Econ, 149: 226–238.
[90] Shokoohyar, S. (2019). Determinants of backpackers' perceptions of
security? A WOM-based approach. E-review of Tourism Research, 16 (4).
[91] Abdi, F. (2021). A New Multi-Stage Feature Selection and
Classification Approach: Bank Customer Credit Ris