The analysis of retail marketing mix effects toward customer satisfaction: a survey of SB mart customers in Bukit Sawangan Indah Housing
THE ANALYSIS OF RETAIL MARKETING MIX EFFECTS
TOWARD CUSTOMER SATISFACTION
(A Survey of SB Mart Customers in Bukit Sawangan Indah Housing)
By : Firas Azhari 109081100013
MANAGEMENT DEPARTEMENT
INTERNATIONAL CLASS
FACULTY OF ECONOMICS AND BUSINESS
SYARIF HIDAYATULLAH STATE ISLAMIC UNIVERSITY
JAKARTA
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CURRICULUM VITAE
PERSONAL DATA
Name : Firas Azhari
Sex : Male
Place and Date of Birth : Bandung, October 16th 1991
Religion : Muslim
Marital Status : Single Height/Weight : 168 cm/50kg Citizenship : Indonesia
Address : Perum. Bukit Sawangan Indah Blok D13/16 Bojongsari Depok 16518
Email : neolazzard@gmail.com
Telephone Numbers : 085780905918
FORMAL EDUCATION BACKGROUND 1997 – 2003 01 Elementary School, Parung (SDN 01) 2003 – 2006 14 Junior High School, Depok (SMPN 14) 2006 – 2009 5 Senior High School, Depok (SMAN 5)
2009 – 2013 Faculty of Economy and Business (International Marketing Management), Syarif Hidayatullah State Islamic University (UIN), Jakarta
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NON-FORMAL EDUCATION BACKGROUND
May-June 2005 Adobe Photoshop Course at LPIA Pondok Cabe - Tanggerang Selatan
September- October 2009 English Conversation Course at EF Cinere-Depok 2010 English Grammar Course at ILP Cinere-Depok 2011 English Writing Course at NZEC Cinere-Depok
ORGANIZATIONS EXPERIENCE
2006 Member of Islamic Organization “ROHIS” at 5 Senior High School in Depok
2011 Comitte of Orientation Day for New College Students at Jakarta Syarif Hidayatullah State Islamic University
SEMINAR AND COMPETITION
2010 Marketing Plan Competition S1 Prasetiya Mulya
2011 Entepreneur Workshop and Training “Mastermind”
at Economic Faculty of University of Indonesia
2011 Seminar of “How to be a Successful
Creativepreneur” at Mathematics and Sciences Faculty of Indonesian University
2012 Workshop and Seminar ADM Fair at Japanese Study Center Indonesian University
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WORK EXPERIENCE
2011 Marketing and Sales at Keripik Jurig (Family Business)
2012 Marketing and Sales at Al-Barokah Regency
Ciputat (Internship)
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ABSTRAK
Penelitian ini bertujuan untuk menganalisis pengaruh retail marketing mix terhadap kepuasan pelanggan SB Mart Bukit Sawangan Indah. Metode convenience sampling telah dipilih untuk memperoleh data dalam penelitian ini. Penelitian ini menggunakan 100 responden dan keseluruhan responden adalah pelanggan SB Mart Bukit Sawangan Indah yang berbelanja di SB Mart Bukit Sawangan Indah dengan minimal umur 17 tahun.
Metode analisis yang digunakan adalah multiple linier regression. Hasil penelitian menunjukan bahwa customer service, store design and display, communication mix, location, merchandise assortment, dan pricing berpengaruh secara simultan terhadap customer satisfaction. Secara parsial customer service, merchandise assortment, dan pricing berpengaruh signifikan terhadap customer satisfaction sedangkan store design and display, communication mix,dan location tidak berpengaruh signifikan terhadap customer satisfaction.
Kata kunci: Retail Marketing Mix, Customer Service, Store Design and Display, Communication Mix, Location, Merchandise Assortment, Pricing, Customer Satisfaction.
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ABSTRACT
This research aims to analyze the influence of retail marketing mix towards customer satisfaction of SB Mart Bukit Sawangan Indah. Convenience sampling method has been selected in order to obtain the data in this study. This research uses 100 respondents and respondents overall are SB Mart customers whose shop in SB Mart Bukit Sawangan Indah and the minimum age is 17 years old.
Methods of analysis used is multiple linier regression. The result of this research shows that customer service, store design and display, communication mix, location, merchandise assortment, and pricing simultaneously have significant influence towards customer satisfaction. Partially, customer service, merchandise assortment, and pricing have significant influence towards customer satisfaction while store design and display, communication mix,dan location have no significant influence towards customer satisfaction.
Keyword: Retail Marketing Mix, Customer Service, Store Design and Display, Communication Mix, Location, Merchandise Assortment, Pricing, Customer Satisfaction.
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PREFERENCE
Bismillahirrahmanirrahim,Assalammualaikum Warahmatullahi Wabarakaatuh
Alhamdulillahirabbil‟alamin, I would say thanks and being grateful to Allah Subhanahu wa ta‟ala for His gift. Best regards also to prophet Nabi Muhammad Shalallahu „alaihi wassalam for being the role model for me. So, I can finish this thesis and fulfilling one of the requirement to get my Bachelor of Economy Degree in State Islamic University, Syarif Hidayatullah Jakarta.
In the process of the preparation of this thesis, the author realized that this thesis is far from perfect. but with effort and prayer, then the author of the successful completion of this thesis. With prayers and the support given by the people closest to me. I say thanks to the people who have helped me in the preparation of thesis:
1. Thanks to mother Yati Rosmiati, father Wawan Sumpena, and my sister Hilma Nur‟aini that always give the support and never stop praying. So, I can finish this thesis very well. Thanks to Mama who always being a reminder for me, always advising me, teaching me how to be patient. Thanks to Papa who supporting me, helping, and caring me so much. May Allah bless both of you my paretns. I love you.
2. Mr. Prof. Dr. Abdul Hamid, MS as Dean of Economic and Business Faculty of State Islamic University Syarif Hidayatullah Jakarta
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3. Dr. Muniaty Aisyah, Ir., MM as a first supervisor, thank you for your advice and knowledge during guiding to finish my thesis.
4. Mr. Ade Suherlan, MBA, MM as a second supervisor, thank you so much for guiding me until finished this thesis. Thank you for your knowledge, advice, recommendation.
5. Lecturer UIN Syarif Hidayatullah Jakarta, which has giving the knowledge and experience .
6. All academic staff FEB UIN Jakarta, which has worked well to serve all student.
7. Rara Angguntyas, thank you for your support, concern, reminder, nagging and time for me . Thanks for helping me so much to finish this thesis, you were always there when I need.
8. To my friends who always help me to complete this thesis Vera Suciati, Risty Sucianingsih, Genta Ferdian, Danang Ismaya, Tatria Ariesta, Luqman, Kak Alif, Kak Fitria and the others thank you for helping me, success for all of you guys.
9. To my classmate in International Management 2009, I have missed the moment which are we spent together.
10.To PMII Komfeis and PMII Ciputat, thank you for the lesson and experience which are given to me.
11.Finally, the author expect for any critics as well as suggestion that could improve the content of this thesis. Hopefully this thesis could be worthwhile for all us. Aamiin
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Waullahul Muwafik Ila Aqwamit Thariq
Wassalamualaikum Warahmatullahi Wabarakaatuh
Jakarta, January 7th 2015
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LIST OF CONTAINS
ACCEPTANCE OF LETTER ... i
CERTIFICATION OF THESIS EXAM ... ii
CERTIFICATION OF COMPREHENSIVE EXAM ... iii
SHEET STATEMENT ... iv
CURRICULUM VITAE ... v
ABSTRACT ... vi
ABSTRAK ... vii
PREFERENCE ... x
LIST OF CONTAINS ... xiii
LIST OF TABLE ... xvii
LIST OF FIGURE ... xx
APPENDIX ... xxi
CHAPTER I INTRODUCTION A. Research Background ... 1
B. Problem Formulation ... 7
C. Research Objectives ... 8
D. Research Benefits ... 9
CHAPTER II LITERATURE REVIEW A. Marketing ... 10
B. Service Marketing ... 11
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2. Service Marketing Mix ... 12
C. Retail ... 14
D. Retail Marketing Mix ... 22
E. Customer Satisfaction ... 32
F. Previous Research ... 40
H. Frame of Thinking ... 45
I. Hypothesis ... 47
CHAPTER III RESEARCH METHODOLOGY A. Scope of Research ... 49
B. Population and sample method ... 49
1. Population ... 49
2. Sample ... 49
C. Data Collection Method ... 50
1. Primary Data ... 50
2. Secondary Data ... 51
D. Analysis method ... 51
1. Validity and Reliability Test ... 53
2. Classic Assumption Test ... 54
3. Multiple Linear Regression Analysis ... 58
4. Coefficient of Determination Test (R2) ... 59
5. Partial Test (T Test) ... 59
6. Simultaneous Test (F Test) ... 61
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CHAPTER IV ANALYSIS
A. General Overview Research object ... 68
1. The History of SB Mart ... 68
B. Analysis and Discussion ... 72
1. Validity Test ... 72
2. Reliability Test ... 75
C. Characteristic and Respondents Data ... 76
1. Descriptive Analysis ... 77
D. Analysis Result ... 123
1. Classic Assumption Test ... 123
a. Normality Test ... 123
b. Multicollinearity Test ... 127
c. Heteroscedasticity Test ... 128
2. Multiple Linear Regression Analysis ... 132
3. Coefficient of Determination Test (R2) ... 134
4. Partial Test (T Test) ... 135
5. Simultaneously Test (F Test) ... 142
CHAPTER IV CONCLUSION AND IMPLICATION A. Conclusions ... 144
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REFERENCE ... 149 APPENDIX ... 154
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LIST OF TABLE
No Description Page
3.1 Variable Operational Definition ... 63
4.1 Validity test ... 73
4.2 Reliability test ... 75
4.3 Characteristic of respondents ... 77
4.4 SB Mart employees are always use uniform neatly ... 78
4.5 Customers can easily use a trolley or shopping cart ... 79
4.6 Customers can easily pay for purchases using a credit/debit card ... 80
4.7 Customers can easily use the delivery service of SB Mart ... 81
4.8 SB Mart employees serve customers very friendly ... 82
4.9 SB Mart employees are always ready to help customers ... 83
4.10 Any complaints from customers, always quickly responded ... 84
4.11 SB Mart employees can give solutions when customers are having problems ... 85
4.12 SB Mart employees know the information about the products being sold ... 86
4.13 Customers feel comfortable while shopping at SB Mart ... 87
4.14 Customers trust with the security at SB Mart ... 88
4.15 SB Mart employees are willing to deal with customer complaints and resolved ... 89
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4.17 SB Mart store is clean ... 91
4.18 SB Mart puts the products sold on a regular basis. ... 92
4.19 Placement of products in SB Mart makes customers to find the products desired easily ... 93
4.20 Room temperature in SB Mart store is convenient ... 94
4.21 The store layout makes customers easily to find the products desired 4.22 Lighting in SB Mart stores reasonably bright ... 95
4.23 The greeting habit of SB Mart employees bring Islamic nuances .... 96
4.24 SB Mart store room does not smell bad ... 97
4.25 SB Mart gives sales promotion such as discount, prizes, and bonus to customers ... 98
4.26 The information about sales promotion is clearly conveyed to customers ... 99
4.27 SB Mart sales promotion is attractive ... 100
4.28 The signboard used allows customers to recognize SB Mart store ... 101
4.29 The sign used by SB Mart allows customers to find SB Mart stores 102
4.30 Brochure design used by SB Mart is attractive ... ... 103
4.31 Brochure design used by SB Mart is easy to read... 104
4.32 SB Mart location easily accessible by private vehicle ... 105
4.33 SB Mart location easily accessible by public transport... 106
4.34 The location of SB Mart is easily found by customers... .... 107
4.35 The location of SB Mart is near from highway... 108
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4.37 SB Mart parking lot quite spacious ... 110
4.38 SB Mart parking lot well organized ... 111
4.39 SB Mart location is safe ... 112
4.40 A wide variety of products sold in SB Mart ... 113
4.41 SB Mart sells products in various packaging sizes ... 114
4.42 The stock of products sold in SB Mart well available ... 115
4.43 The prices are provided by SB Mart in line with the quality obtained by the customer ... 116
4.44 The prices are provided by SB Mart in line with the benefit obtained by the customer ... 117
4.45 The price offered by SB Mart relatively more affordable than in other place ... 118
4.46 I am satisfied with the quality of products sold in SB Mart ... 119
4.47 I am satisfied with the services provided by SB Mart store clerk ... 120
4.48 SB Mart has a good reputation ... 121
4.49 Overall I am satisfied shopping at SB Mart ... 122
4.50 One-Sample Kolmogorov-Smirnov Test ... 126
4.51 Coefficients (Multicollinearity) ... 128
4.52 Coefficients (Heteroscedasticity) ... 131
4.53 Multiple Linear Regression Analysis ... 132
4.54 Coefficient of Determination (R2) ... 134
4.55 Partial Test (T Test) ... 135
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LIST OF FIGURE
No Description Page
2.1 A Typical Channel of Distribution ... 16
2.2 The Elements in Retail Mix ... 32
2.3 Customer Satisfaction Concept ... 37
2.4 Conceptual Thinking ... 46
4.1 Normal P-P Plot of Regression Standized Residual ... 124
4.2 Histogram ... 125
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APPENDIX
No Description Page
1. Research Questionnaires ... 154
2. Multiple Liniear Regression Analysis Questionnaires ... 159 3. Frequency of Respondents ... 178 4. Validity and Reliability Test ... 194 5. SPSS Output ... 196
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1 CHAPTER I
INTRODUCTION
A. Research Background
According to Kotler & Armstrong (2010:29), marketing is the process by which companies create value for customers and build strong relationship with customers in order to capture value from customers in return. Marketing is one of the main activities undertaken by entrepreneurs in attempting to develop and maintain the viability of enterprises as well as make a profit. Success or failure in achieving goals depends on their expertise in marketing, production, finance and other fields, which are related to each other in achieving corporate goals.
In general, market-oriented companies will face problems in marketing field. With the very fast development of technology, it allows companies produce good quality products and services. But it is meaningless if it is not matched by capability to market and satisfy customers with products and services. Thus marketing activities should be planned first before carrying out the activities in accordance with the wishes, needs, and expectations of the consumer.
The economic structure is gradually changing and even, recently, the changes seem faster. Similarly, the development of retail business in Indonesia now is increasing so rapidly. Along with the development of business in Indonesia, modern retail business or commonly called retailers, its presence increasingly felt in the everyday lives of the people.
In a short period of time some modern retail businesses with big capital conduct their activities in Indonesia. That's because, since 1998, the map of retail
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2 industry underwent major changes, especially after the government conducted liberalization. It marked by the signing of a letter of intent with the IMF providing investment opportunities to foreigners to enter the retail industry (http://goo.gl/ciULGG) and the growth of the Indonesian middle class society in the period 2012-2020 is estimated at 174%. AC Nielsen survey showed 48% of the total expenditure of fast moving consumer goods (FMCG) comes from a middle-class society. It is also became a encouraging factor of retail business growing. (http://goo.gl/zPh3MV)
Retail business in Indonesia can be divided into two major groups, namely traditional retail and modern retail. The modern retail is a development of traditional retail. The retail formats emerge and evolve as economic development, technology, and people's lifestyle that makes people demand more convenience in shopping. Modern retail also appear in various shapes and sizes to provide a clean and cool place, good quality products and service, and the price offered was fair, comparable with the quality provided.
The first modern retail presence in Indonesia when the Sarinah department store established in 1962. In the era of 1970 to 1980's, the retail business continuously grew. Early 1990s was a milestone in the history of the entry of foreign retail in Indonesia. It is characterized by the operation of Japan's largest retail, Sogo, in Indonesia. (http://goo.gl/KeA1GT)Currently, many types of modern retail in Indonesia includes Modern Markets, Department Stores, Factory Outlets and so forth. The forms of modern retail trade activities engaged in the retail industry generally in the form of hypermarkets, supermarkets, and minimarket.
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3 The definition of retail by Ma’ruf (stated in Ikhwan, 2012:9) is a business activity to sell goods or services to individuals for the purposes of theirself, family, or household. He adds that "they sell the goods (or services) directly to consumers". Retail is the last stage in a distribution channel that contains the people and businesses that are physically involved in moving and transfering goods and services from producer to end consumer. Retailing is the set of business activities that adds value to the products and services sold to consumers for their personal or family use (Levy & Weitz, 2012:6).
Now it is very easy to find modern retail shopping in the big cities, especially a mini market. A mini market in this case is an alternative place to shop for consumers which has a special characteristics that the goods are arranged in open shelves and consumers choose the items that they need or want, then bring it to the cashier to pay with the fixed price (not a bargain).
With so many existing mini market, consumers will become more critical in choosing a place to shop. It encourages retail entrepreneurs to compete in grabbing the market share. How to attract customers to come to the mini market then conduct transactions is not easy. The role of retail marketing mix is very important and influential. Without the right retail marketing mix, the retail company will face difficulty in marketing, therefore the retail marketing mix really should be considered. According to Levy and Weitz (2012:20) elements in the retail marketing mix consists of location, merchandise assortments, pricing, customer service, store design and display, and communication mix.
SB Mart was established on August 3, 2010. The establishment of SB Mart is motivated by a sense of longing for the presence of shopping facilities for the
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4 general public which really favor the general public consumers, traders and economic actors in the environment surrounding SB Mart. SB Mart has a different nuances compare with others mini markets, also has a different philosophy and orientation.
SB Mart is one of the business unit of Sejahtera Bersama Cooperative which is engaged in trading of basic needs which are expected to provide basic daily needs for members / prospective members of the cooperative and the community at large with good quality and reasonable price as well as a builder for the store-small store owned by the community in each area.
Along with the rise of the mini market business in Indonesia, SB Mart comes in serving people with different store shades. Both in terms of the atmosphere of shopping, the appearance, or products that are sold. SB Mart does not sell liquor and other illicit goods so SB Mart is very friendly with the family of Indonesia. In SB Mart also sold distinctive merchandise such as Habbatusauda, Zam-Zam water, palm juice, equipment prayer, as well as books of Islam. It makes SB Mart looks very strong with Islamic nuance. With more than 4,000 product variations merchandise items, as well as reinforced with Islamic nuance and Systems Information Technology (IT) which qualified, it is expected that people can rely on the existence of SB Mart in their respective communities as providers of everyday staples, moreover SB Mart provides more fruit variation, especially local fruits.
SB Mart has advantages over competitors in terms of service delivery. Simply by calling SB Mart, the goods that customers want will be delivered directly to the customers' homes. SB Mart has programs that greatly favor the
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5 small traders and business people around SB Mart environment, It realized with Partnership Shelf Program, Muhasaba (Sejahtera Bersama Business Partners), as well as the Speical Price for Members. Shelves partnerships are used as a means to accommodate the products whether it is food, craftsand others produced by people around SB Mart stores are located. Therefore, SB Mart's expansion plans are directed to reach out to remote areas. With these programs, SB Mart is expected to be a builder for small shops owned by people in each area and can actually be a mini market that can compete and prosper each member / prospective member Sejahtera Bersama Cooperative and the public at large.
In conducting its business, the SB Mart uphold the principles of cooperative oriented to help, strengthen and develop the economy of the community to improve the economic and social welfare of the community itself. SB Mart has very much cooperative members and spread throughout Indonesia. Like the philosophy of cooperative economy "from member to member", SB Mart gives special price to members. The very cheap price is expected to give more loyalty to members for shopping and fulfill the daily needs at SB Mart. The more often members shop at SB Mart, the greater SHU they will be enjoyed.
However, SB Mart's target market is not only its members, the main target is the middle class of Muslim family. Therefore, SB mart established with the motto Convenient and Ideal. The establishment SB Mart stores always consider the condition. Starting from extensive parking, the clean of stores, wide shopping aisle, friendly service, providing shopping trolley and so forth. Availability of
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6 prices corresponding to the entire target market, SB Mart is expected to satisfy all consumers so that SB Mart Ideal for all walks of life. (www.sbmart.co.id)
SB Mart which headquartered in Bandung is still fairly young when compared to the competitors that are stronger in terms of capital and have long been in the field of modern retail business. However, it did not break the spirit of SB Mart to become even greater. This was proven by SB Mart, it already has more than 150 outlets (http://goo.gl/2PJPfh), one in the district Bojongsari exactly in front of Bukit Sawangan Indah housing, and will have continue to grow. SB Mart Bukit Sawangan Indah itself was set up in 2012 and have already had to contend with a well-known brand competitor. But it did not make the SB Mart retreat because SB Mart Bukit Sawangan Indah has distinctive competence than its competitors. They are delivery service, providing shopping trolley, and unusual products sold in minimarket (Zam Zam Water, prayer paraphernalia, and the others). But, compare to its competitors, the location of SB Mart Bukit Sawangan Indah is not exactly beside the highway, so it is not visible from the highway.The location is around 150 meters from the highway.How does the retail marketing mix used by SB Mart is an interesting thing to be studied.
Based on the description in the background, researchers interested in conducting further research on the issue of retail marketing mix in SB Mart. For that, in this study, the researchers took on the title "THE ANALYSIS OF RETAIL MARKETING MIX EFFECTS TOWARDS CUSTOMER SATISFACTION AT SB MART IN BUKIT SAWANGAN INDAH HOUSING."
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7 B. Problem Statements
Based on the background of the problems that have been described, to examine the influence of retail marketing mix (customer service, store design and display, communication mix, location, merchandise assortment, and pricing) towards customer satisfactiont, the problem in this study is formulated as follows:
1. Does the customer service (X1) has significant influence towards customer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing?
2. Does the store design and display (X2) has significant influence towards customer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing? 3. Does the communication mix (X3) has significant influence towards
customer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing? 4. Does the location (X4) has significant influence towards customer
satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing?
5. Does the merchandise assortment (X5) has significant influence towards customer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing? 6. Does the pricing (X6) has significant influence towards customer
satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing?
7. Do the customer service (X1), store design and display (X2), communication mix (X3), location (X4), merchandise assortment (X5), and pricing (X6) have significant influence towards customer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing?
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8 C. Research Objectives
Based on the problems that have been formulated, the purpose of this research are as follows:
1. To analyze the influence of customer service (X1) towards consumer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing
2. To analyze the influence of store design and display (X2) towards consumer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing 3. To analyze the influence of communication mix (X3) towards consumer
satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing
4. To analyze the influence of location (X4) towards consumer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing
5. To analyze the influence of merchandise assortment (X5) towards consumer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing 6. To analyze the influence of pricing (X6) towards consumer satisfaction
(Y) at SB Mart in Bukit Sawangan Indah Housing
7. To analyze the influence of customer service (X1), store design and display (X2), communication mix (X3), location (X4), merchandise assortment (X5), and pricing (X6) have significant influence towards customer satisfaction (Y) at SB Mart in Bukit Sawangan Indah Housing
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9 D. Research Benefits
This research will provide the following benefits: 1. For The Company
As inputs to the management of SB Mart about the effect of retail marketingmix variables (customer service (X1), store design and display (X2), communication mix (X3), location (X4), merchandise assortment (X5), and pricing (X6)) towards consumer satisfaction (Y).
2. For The Universities
Increase the repertoire of research for Marketing Management Science Program in Jakarta Syarif Hidayatullah State Islamic University.
3. For The Researchers
Increase knowledge and insight in the field of marketing management, especially regarding consumer purchasing decisions and the marketing mix.
4. For Further Research
For reference materials in reviewing issues related to customer satisfaction and retail.
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10 CHAPTER II
LITERATURE REVIEW
A. Marketing
According to Kotler and Keller (2009:45), marketing has been defined as an organization function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. Thus, we see marketing management as the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.
Marketing is not just sales activities. Activities in marketing relate to each other. Marketing activities began long before production and does not end just with the sales. If marketers want their products sold in the market, survive and grow, then marketers must think about what products they want to make to fit the needs of consumers. Once the product is made then the marketer has to think about how to communicate the product or advertise these products. Consumers who have purchased a product does not necessarily make the marketers to stop thinking about the next activity, marketers must be able to ensure consumers are satisfied with the products that we sell and re-purchase.
According to Kotler & Keller (2009:45), the aim of marketing is to make selling superflous and to know and understand the customer so well that the product or services fits him and sells itself. Ideally, marketing should result in
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11 a customer who is ready to buy. All that should be needed then is to make the product or service available.
B. Service Marketing
Services are often seen as a complex phenomenon. The word of services itself has many meanings, from personal service to service as a product. So far it has been a lot of marketing expert services that have attempted to define the understanding of services. Some of them are; Lovelock et al (2005:9)define service are economic activities offered by one party to another, most commonly employing time-defined performances to bring about desired result in recipients themselves or in objects or other assets for which purchasers have responsibility. Service customers expect to obtain value from access to labor, professional skills, facilities, networks, systems, and equipment, but no not normally take ownership of any of the physical elements involved. While according to Kotler & Keller (2009:386), a service is any act or performance one party can offer to another that is essentially intangible and does not result in the ownership of anything.
1. Service Marketing Characteristics
Based on Kotler & Keller (2009:389-391), there are four characteristics of service:
a. Intangibility
Unlike physical products, service cannot be seen, tasted, felt, heard, or smelled before the purchase, and the patient in the psychiatrist’s office cannot know the exact outcome of treatment.
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12 b. Inseparability
Whereas physical goods are manufactured, put into inventory, distributed through multiple resellers, and consumed later, service are typically produced and consumed simultaneously.
c. Variability
Because the quality of service depends on who provides them, when and where, and to whom, services are highly variable.
d. Perishability
Services have little or no tangible components and therefore cannot be stored for a future use. Services are produced and consumed during the same period of time.
2. Service Marketing Mix
According to Lovelock et al (2005:25-26), there are seven elements of service marketing mix, referred to as 7Ps of service marketing, represent a set of interrelated decision variables facing managers of service organizations.
a. Product Elements
Managers must select the features of both the core product (either a good or service) and the bundle of supplementary service elements surrounding it, with reference to the benefits desired by customers and how well competing produtcs perform. In short, we need to be attentive to all aspects of the service performance that have the potential to create value for customers.
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13 b. Place and Time
Delivering product elements to customers involves decisions on the place and time of delivery, as well as the methods and channels employed. Delivery may involve physical or electronic distribution channels (or both), depending on the nature of the service being provided.
c. Promotion and Education
No marketing program can succeed without effective communication. This component plays three vital roles: providing needed information and advice, persuading target customers of the merits of a specific product, and encouraging them to take action at specific times. In service marketing, much communication id educational in nature, especially for new customers. Companies may need to teach these customers about the benefits of the service, where and when to obtain it, and provide instructions on how to participate in service processes. d. Price and Other Cost of Service
This component addresses amangement of the costs incurred by customers in obtaining benefits from the service products. Service managers not only set the selling price, trade margins, and establish credit terms; they also seek to minimize, where possible, other costs that customers may bear in purchasing and using a service, like related costs (e.g., travel expenses), time, and mental and physical effort.
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14 e. Physical Environment
The appearance of buildings, landscapings, vehicles, interior furnishing, equipment, staff members, signs, printed materials, and other visible cues all provide tangible evidence of a firm’s service quality.
f. Process
Creating and delivering product elements to customers require the design and implementation of effective processes. A process is the method and sequence of actions in the service performance. Badly designed processes like slow, bureaucratic, and ineffective service delivery, commonly annoy customers.
g. People
Many services depend on direct interaction between customers and a firm’s employees (like getting a haircut or talking to a call center staff). The nature of these interactions strongly influences the customer’s perceptions of service quality.
C. Retail
In distributing products to consumers manufacturers will be faced with two options, namely the use of intermediaries or distribute their own products to consumers. Most producers use intermediaries because of their efficiency advantage in making goods widely available and easy to obtain the target market.
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15 Retailing is one form of trade intermediaries. Retailing is the final activity of a series of travel products from producer to final consumer. Retailing activities are not limited only done by retailers, but done by anyone including manufacturers, wholesalers, and distributors, if they do direct sales to the end consumer (Munir, 2011:33). According to Dunne, Lusch, and Griffith (stated in Setiawan & Kunto, 2013:2), retailing is the final activities and steps needed to place merchandise made wherever its place, into the hands of the consumer or to provide services to consumers.
According to Berman & Evans (2010:4), retailing encompasses the business activities involved in selling goods and service to consumers for their personal, family, or household use. According to Kotler & Keller (2009:482) retailing is all activities covered by the sale of goods or services directly to end consumers for personal and non-busines use.
Based on some retailing definitions above, it can be concluded that the retail business (retailing) is a type of trade service business which is the last line in distribution of goods and services from producer to final consumer for personal use or family purpose. The position of the retail business is becoming increasingly important because it is closest to the end consumer.
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16 Figure 2.1
A Typical Channel of Distribution
Source : Levy & Weitz (2012:7)
In general, the main reason for using intermediaries is that they can help improve the efficiency of distribution. According to Levy & Weitz (2012:7-8), the use of intermediaries or retailers have several advantages, that are:
1. Providing Assortments.
Supermarkets typically carry 20,000 to 30,000 different items made by more than 500 companies. Offering an assortments enables their customers to choose from a wide selection of roducts, brands, sizes, and prices at one location
2. Breaking Bulk.
To reduce transportation cost, manufacturers and wholesalers typically ship cases of frozen dinners or cartons of blouses to retailers. Retailers then offer the products in smaller quantities tailored to individual consumers’ and households’ consumption pattern-an activity called breaking bulk. Breaking bulk is important to both manufacturers and consumers. It enables manufacturers to efficiently make and ship
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17 merchandise in larger quantities and enables consumers to purchase merchandise in smaller, more useful quantities.
3. Holding Inventory
A major value-providing activity performed by retailers is holding inventory so that the product will be available when consumers want them. Thus, consumers can keep a smaller inventory of products at home because they know local retailers will have the products available when they nedd more. This activity is particularly important to consumers with limited storage space.
4. Providing Service.
Retailers provide service that make it easier for customers to buy and use products. For example, retailers offer credit so that consumers can have a product now and pay for it later. They display products so that consumers can see and test them before buying. Some retailers employ salespeople in stores or maintain Web sites to answer questions and provide additional information about products.
5. Increasing the Value of Products and Services
By providing assortments, breaking bulk, holding inventory, and providing service, retailers increase the value that consumers receive from their products and services.
6. Another advantage which can be expected by the manufacturers of these intermediaries are:
a. Assist in the consumer search b. Assist in promotion activities
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18 c. Assist in the provision of information
d. Assist in packing and wrapping e. Assist in the sorting
Retail business can be specified in a classification based on size, ownership, operation, and so on. Classification is relatively easy to divide the retail business into two major groups, namely large retailers and small retailers. Included in this is a major retail specialty stores, department stores, supermarkets, discount house, hypermarkets, general stores and chain stores. Small retail is divided into retail traders that stay in a place and retail traders that don’t stay in a place. Retail traders that stay in a place further subdivided into fixed place (e.g. kiosks, depot, stall), non permanent place (e.g. street vendors), and use the tools (thrust wheels, carts, tools bear) (Sopiah and Syihabudhin stated in Utomo, 2009:47).
Kotler& Armstrong(2010: 395) divides retailers into store retailing and retail organization.
1. Store Retailing, the types are:
a. Specialty Stores is a store that carry a narrow product line with deep assortment, such as apparel stores, sporting-goods stores, furniture store, florist, and bookstores.
b. Deparment Stores is a store that carry several product lines-typically clothing, home furnishing, and household goods-with each line specialist buyers or merchandisers.
c. Supermarkets are stores with a relatively large operation, low cost, low margin, high volume, self-service operation designed to
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19 serve the customer’s total needs for grocery and household products.
d. Convenient Stores is a relatively small store and located near residential areas, have long opening hours seven days a week, and carrying a limited line of high-turnover convenience products at slightly higher prices.
e. Discount Stores are stores that carry standard merchandise sold at lower prices with lower margins and higer volume.
f. Off-price Retailers are stores that sell merchandise bought at less-than-regular wholesale prices and sold at less than retail, often leftover goods, overruns, and irregulars obtained at reduced prices from manufacturesrs or other retailers. There are three types of retailer discounts:
1) Factory Outlets are stores owned and operated by the manufacturer and usually sell excess goods, no longer manufactured, or are not regular.
2) Independent Off-price Retailers are stores owned and run by entrepreneurs or division of a large retailer.
3) Warehouse Clubs / Wholesale Clubs are which store selling a limited selection of branded food products, household items, clothing, and a variety of other goods with big discount to members which pay annual dues.
g. Superstores are stores which have very large stores traditionally aimed at meeting consumers’ total needs for routinely purchased
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20 food and nonfood items. Includeds supercenters, combined supermarket and discount stores, and category killers, which carry a deep assortment in a particular category and have a knowledgeable staff.
2. Retail Organizations, the types are:
a. Corporate chain stores, are two or more stores that are commonly owned and controlled. Corporate chains appear in all types of retailing, but they are strongest in department stores food stores, drug stores, shoe stores, and women’s clothing stores.
b. Voluntary chain, wholesaler-sponsored group of independent retailers engaged in group buying and merchandising.
c. Retailer cooperative, group of independent retailers who set up a central buying organization and conduct joint promotion efforts. d. Consumer Cooperative, a company retail owned by its customers. e. Franchise Organization, contractual association between a
franchise (the franchiser, ie manufacturer, wholesaler, or service organization) withfranchisees (franchisees, which is an independent businessman who bought the rights to own and operate one or more units in the franchise system).
f. Merchandising Conglomerate, a free form of company that combines some lines and retailing shapes in centralized ownership, which also brings together the distribution and management functions.
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21 According to Rohmad (stated in Utomo, 2009:53), the importance of trade intermediaries or members of distribution channels in the overall marketing process can be demonstrated by the different roles they play, include:
a. Provide storage and transport for manufacturer or company, so manufacturers can concentrate on production activities.
b. Provide installation and repair, thereby reducing the role of producer. c. Provide funding to the consumer, so that the financial burden is
reduced producer.
d. Implement advertising and promotional activities of products, thereby enhancing the overall ability of market.
e. Acting as an agent for the manufacturer to obtain information about consumers, so manufacturers can develop products.
f. Creating form, time, place and ownership so that the products can be delivered in the right market at the right time, and through the right distribution channels - including provisions regarding the suitability of packaging.
Sopiah and Syihabudhin (stated in Utomo, 2009:54) explains, the retail trade is very important for producers because through retailers producers can gain valuable information about the goods. Manufacturers could interview retailer of consumer comments about the shape, taste, durability, price, and everything about the product. It can also knows the rival powers. Manufacturers and retailers can foster mutually beneficial cooperation.
From the explanation above, it can be concluded that the main function is to provide a wide range of retail products and services,that is assorting
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22 products, breaking bulk, entering into inventory, providing services , increasing the value of products and services. The important principle in retailing is "the right product in the right place at the right time". Based on the principle that a product marketing should be sold at a place that is accessible by consumers and through promotions.
Retailers which focus on the consumer will maintain the culture to always exceed consumer expectations. So retailers need to recruit the right people, and providing learning for employees continously, thus will increasing consumer interaction with the employees. The elements of retailing mix is a marketing strategy undertaken by retailers.
D. Retail MarketingMix
In marketing there is a strategy called the marketing mix. It has an important role in influencing consumers to purchase products or services offered by the company to the market. After determining the right company competitive marketing strategy, the company is ready to plan the details of the marketing mix.
Ma’ruf (stated in Ikhwan 2012:23) states that "retail mix is a combination of retail factors used to satisfy the needs of customers and influence their decision to buy". According to Levy and Weitz (2012:20) elements in the retail mix consists of location, merchandise assortments, pricing, customer service, store design and display, and communication mix. Those are:
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23 1. Customer service
According to Levy and Weitz (2012:499), "customer service is the set of activities and programs undertaken by retailers to make the shopping experience more rewarding for their customers". There is a perception 5 consumers use to evaluate customer service, by using the service quality (Levy and Weitz, 2012:505-506), including:
a. Tangible
An appearance of physical facilities, equipment, personnel, and communication materials.
b. Reliability
An ability to perform as a reliable and accurate service, as do the services in accordance with the agreement or that have been contracted out or delivery appointment time.
c. Responsiveness
It is the willingness to help customers and provide prompt service, such as returning calls and e-mails promptly.
d. Assurance
Is the knowledge and courtesy of employees and their ability to convey trust and comfort, such as salespeople who have been fully trained. e. Empathy
Referring to the concern, the provision of special concern to consumers, such as personal services, receiving records and e-mails, or recognition by name.
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24 It could be argued that service quality talk about how to make customers happy with good and right service through responsiveness, reliability, understanding, fulfillment of a promise to consumers and so on.
2. Store design and display
Levy and Weitz (2012:468) says that "The primary objective of a store design is to implement the retailer's strategy. The design must be consistent with and reinforce the retailer's strategy by meeting the needs of the target market and building a sustainable competitive advantage. "That means the main goal of the store design is to implement a strategy of retailers. The design should be consistent and reinforce the retail strategy to meet the needs of the target market and build sustainable competitive advantage.
In implementing the retail strategy, the retailer has to consider the store atmosphere. According to Berman and Evans (stated in Santosa, 2014:16), atmosphere refers to the store's physical characteristics that are used to developed an image and draw customers.. Berman dan Evans (stated in Fuad, 2010:3) divide elements of store atmosphere into four elements, namely the store exterior,general interior, store layout and interior display. a. Store exterior or the front of the store reflects the steadiness and the
robustness of the spirit of the company and the nature of the activities in it, and can create trust and goodwill for consumers. Store exterior serves as identification or recognition marks, so often expressed symbol. Which includes part of the store exterior is outbuildings, shop
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25 signs, entrance, building, design stores, parking facilities, store yard, and security vehicles.
b. General interior of the store should be designed to maximize the visual merchandising. As it is known, advertising can attract buyers to come to the store, but the main thing that can make a sale after the purchase was in the store is the display. Good display can attract the attention of consumers and help them to be easy to observe, examine and choose the goods, and finally make a purchase when consumers into store. The general impression of the interior can be created through store wall color attractive, light room, played music, the neatness of setting goods in shelves, friendly employees, store cleanliness, and the smell and air inside store.
c. Store layout is the plan to determine the specific location and arrangement of the street alley in the store are quite wide which makes it easy for consumers in walking in it. Store layout will invited customers to enter or cause them to stay away from the store when consumers are seeing the inside of store through a storefront window or entrance door. Good layout will be able to invite consumers and make them walking around longer and spend more money. Which includes store layout is kind of goods, arrangement of goods, facilities store, store settings and groups of goods.
Store layout is the layout of the product, cashier, and flow of passing customers in the store. Retailers must design the attractive product store layout and easily accessible by consumers. Store layout should
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26 also enable customers running and passing so that consumers can seek and obtain needed goods easily and quickly. In principle, store layout of all the elements in the store should create a pleasant atmosphere for all parties, namely the consumers, service shops and retailers. Store layout that will help retailers to be able to display their products properly, allows consumers to shop clerk and improve work efficiency, increase profits for shopkeepers and influence consumer buying behavior(Sumarwan stated in Stiefi, 2012:15).
d. The interior displays are signs that are used to provide information to consumers to influence the atmosphere of store environment, with the main goal to increase sales and profits of the store. Which includes interior display is a poster, signage location, mark special events like Eid image and the new year, and media wrapper.
While, according to Dunne, Lusch, and Griffith (in Setiawan dan Kunto, 2013:4). Store design in a store is the most important element in the planning of the store environment.
a. Store front design / exterior
The front of the store is an important part, therefore the front of the store to be easily visible, easily identifiable by passing vehicles, and give the impression to people who see it.
b. Interior design
Interior design here is divided into two, namely the surface and architectural design. Part surfaces such as wood flooring, vinyl¸karpet flooring, ceramic, marble and paint color usage.
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27 c. Lighting design
One of the other important parts of a design is the lighting store. With good lighting, can give effect to the level of store sales.
d. Sounds
Voice used, can greeting to customers who come or use music to make the visitors into a comfortable, more relaxed, relax so they can spend more time somewhere.
e. Smells
Effective store design will appeal to all the human senses, namely sight, sound, touch and smell. The smell is believed to be most closely related senses of all flavors to create a memory and emotion.
3. Communications Mix
According to Levy and Weitz (2012:399) the communication program informs customers about the retailer as well as the merchandise and service it offers and plays a role in developing repeat visits and customer loyalty. Through promotion, companies communicate with customers to make them aware of the existence of companies products and servicesto that they intertest to visit and make purchase.
According to Sullivan & Adcock (stated in Japarianto and Djati, 2011:5),retail promotion is the activity of the company in order to attract visitors and obtain information on how many the consumers. The retail promotion mix elements is as follows:
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28 a. Sales Promotion
Sales Promotion, are special incentives or excitement-building program that encourage consumers to purchase a particular product or service (Levy and Weitz, 2012:411).
b. Advertising
Advertising is part of the promotional mix, simply advertising is defined as a message that offers a product aimed at the public through a medium (Kasali, 2007:9).
4. Location
The location is a very important factor in the retail marketing mix. In the right location, a stores will be more successful than other stores that are less strategic, although both sell the same product, the same amonut of skilled salesman, and both had a nice setting (Pasaribu and Sembiring, 2013:3).
According to Levy and Weitz (2012:215), location decisions have great strategic importance because they have significant effects on store choice and are difficult advantages for competitors to duplicate.
According to Mischitelli(stated in Atmaja and Adiwinata, 2013:3) elements that influence the selection of a location are:
a. Place
Place is the things relating to the location and position. Advisable the location close to the center of the crowd or close to densely populated areas.
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29 b. Parking
The locationshould have its own parking lot or use the public parking lot that is spacious, comfortable, and safe both for two-wheeled vehicles and four wheels.
c. Accessibility
The location was supposed to be an easy way to achieve it, either by private vehicle or by public transport.
d. Visibility
The building should be easily seen and known bymany people. e. Infrastructure
This part of the whole part of the building wherelocation operates, for example: public facilities, transportation, etc.
Lamb, et al (in Munir, 2011:39) stated that the availability of transport public, the distance to other shops, the availability of a place or a parking area, as well as the security of the location are the variables that become consideration in choosing the location.
5. Merchandise assortments
Merchandise assortments closely related to the product. "A product is a tangible and intangible attributes, including packaging, color, price, manufacturer's and retailers, the which the buyer may accept as offering want - satisfaction" (Stanton stated in Alma stated in Nurbiyanto et al., uploaded in 2013). Diversity of products is related to the completeness of the product depth, breadth and quality of the products offered are also the
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30 availability of such products at any time in the store (Engels and Blackwell stated in Liwe, 2013:3).
Therefore, retailers must make the right decisions regarding the diversity of products sold, due to the variety of products in the sense of a complete product from the brand, size, quality and availability of the product at any time will be easier for consumers to choose and buy a wide range of products in accordance with their wishes. (Annisa, 2014). According to Levy and Weitz (2012:32) "Assortment is the number of different items in a merchandise category". They say that the assortment plan reflects:
a. Variety or breadth
Is the number of different categories of merchandise offered. b. Assortment or depth
Is the number of different items in a merchandise category.
In addition, product availability is also noteworthy. According to Levy and Weitz (2012:317), the availability of the product is defined as the percentage of demand for certain items are deemed satisfactory so that no consumer is running out of items to be purchased.
6. Retail pricing
Price is the amount of money charged for something of value(McCharty, Cannon and Pereault in Sinaga, 2012: 14). According to Stanton (stated in Dinawan, 2010:33), the price is a redeemable value by consumers with the
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31 benefits of having or using products or services determined by the buyer or the seller for the same price to all buyers.
While According to Tjiptono (stated in Dinawan, 2010:34) stated that, the price has two major roles in influencing purchasing decisions:
a. The role of price allocation, i.e. the price function in helping the buyer to decide how to obtain benefits or the highest expected utility based on purchasing power.
b. The role of information of price, i.e. the price function in educatingconsumers about the factors of the product, such as quality. Furthermore, Shiffman and Kanuk (stated in Wahyudi in in Dinawan, 2010:35)stated the reference price is any form of prices used by consumers as a basis of comparison for assessing the price of other goods.
According to William J. Stanton(stated in Dinawan, 2010:36) there are three sizes that determine the price, namely:
a. Prices are in line with the quality of a product b. Prices are in line with the benefits of a product c. Comparison with other products price
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32 Figure 2.2
The Elements in Retail Marketing Mix
Source: Levy& Weitz (2012:20)
E. Customer Satisfaction
1. Customer Satisfaction Definition
According to Kotler and Keller (2009:164), satisfaction reflects a person's judgments of a product's perceived performance (or outcome) in relationship to expectation. That means satisfaction is a feeling of pleasure or disappointment resulting from comparing product performance against their expectations. If performance fails to meet expectations, then the customer becomes dissatisfied. If the performance in line with expectations, then the customer becomes satisfied. If performance exceeds expectations, the customer was very satisfied.
Retail Strategy
Customer service
Store design and
display
Communica tion mix
Location Merchandis
e assortments
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33 Usually satisfied customers tend to be more loyal to the products offered then will tell to others about the company and products that satisfy them, more or less attention to competitors' products, less price sensitive, and willing to offer ideas to the company's products or services. High satisfaction or pleasure will cause consumers to behave positively and the emotional attachment to the brand.
Expectation values formed through past experiences, comments or suggestions from customers and information from competitors. The perception of value is a company's ability to serve customers in an effort to satisfy consumers. (Soelasih stated in Wijaya in Wahono & Subagio, 2013: 4)
While the definition of customer satisfaction by Zeithaml, Bitner and Dwayne (stated in Logiawan and Subagio, 2014:5) is customer’s evaluation of a product or service in terms of whether that product or service has met the customer’s needs and expectations. Where they think customer satisfaction is the customer’s valuation of the products or services in terms of judging whether the product or service has met the customer's needs and expectations.
The retail business which always directly related to the consumer requires constant change in order to satisfy its customers. With more and more manufacturers are engaged in fulfilling the needs and desires of consumersthereby causing every business entity must put orientation on customer satisfaction as a primary goal. To that required variables that affect customer satisfaction that is the retail mix.
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34 According to Kolter and Keller (2009:166), there are methods exist to measure customer satisfaction. Periodic surveys can track customer satisfaction directly and also ask additional questions to measure repurchase intention and the respondent’s likelihood or willingness to recommend the company and brand to others. Beside conducting periodic surveys, companies can monitor their customer loss rate and contact customers who have stopped buying or who have switched to another supplier to find out why. Finally, companies can hire myestery shoppers to pose as potential buyers and report on strong and weak points experienced in buying the company’s and competitor’s product.
According toLupiyoadi (stated in Akmal et al., 2012:2) factors that determine customer satisfaction are:
a. Product Quality
Customers will be satisfied if the evaluation results showed that the products they use have good quality.
b. Service Quality
Customers will be satisfied if they receive good quality of service or in accordance with their expectation.
c. Price
Product with the same quality but set the relatively cheap price, will give a higher value to its customers.
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35 Customers will feel proud and have the belief that other people would be amazed to him when using a product with a particular brand and will tend to have a higher level of satisfaction.
e. Costs and the ease of obtaining goods or services.
Customers do not need to spend additional costs and no need to waste time tend to be more satisfied with the product or service. While, according to Dutka (stated in Melinda in Saidani & Arifin, 2012: 6), there are three dimensions in measure of customer satisfaction universally that are
a. Attributes related to the product that is the dimension of satisfaction associated with the attributes of the product such as the determination of the values obtained with the price, the ability of the product determines satisfaction, the benefits of these products. b. Attributes related to service that is the dimensions of satisfaction
associated with the attributes of the service for example with the promised warranty, service fulfillment or delivery process, and the process of resolving the given problem.
c. Attributes related to purchase, that is the dimensions of satisfaction associated with the attributes of the decision whether to buy or not from manufacturers such as ease of information received, courtesy of employees and also the influence of the company's reputation. According to Kennedy and Young (stated in Lustinayanti, 2011:25), there are six dimensions of customer satisfaction measurement in services, namely:
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36 a. Satisfaction with process
Customers are satisfied with the whole process obtained from the customer receives services from the beginning to leave the place of service.
b. Satisfaction with personal treatment
Customer satisfaction with the services provided by all those involved in the process from the beginning penmberian services receive services to leave the place of service.
c. Satisfaction with waiting time
Satisfaction with queuing time customers need to do while waiting to get service from a provider.
d. Satisfaction of the place
Customer satisfaction towards the place where the transfer of services, the entire room that is able to give the impression of a clean and convenient to the customer.
e. Overall Satisfaction
Perceived level of customer satisfaction overall.
Consumer satisfaction depends on the performance offered associated with the consumer rewards. Satisfaction is a function of which perceived and expected. Consumers hope are influenced by previous experience, a friend or relative, and appointments and information provided by
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37 marketers and competitors, consumer satisfaction problem is the personal problems which has subjective nature, because satisfaction of a person is not necessarily same with the satisfaction perceived by others.
Figure 2.3
Customer Satisfaction Concept
Source: (Tjiptono stated in Anindita, 2012:23)
Company Objectives Customers
Needs & Wants
Customer’s Expectation Towards
Goods/Service Products
(Good/Service)
The Value of Good/Service For Customers
The Level of Customer Satisfaction
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38 Most of the companies make a huge mistake, when they are not paying enough attention to their customer satisfaction. Keeping customers satisfied is the bestcompetitive advantage against competitors. Customers are loyal, prepared to pay more and are excellent external marketers. Here is a list of the reasons for developing long-term relationships with customers:
a. Acquiring new customers can cost 5 to 10 times more than the costs involved in satisfying and retaining current customers. b. Loyal customers tend to spend more and cost less to serve.
c. Satisfied customers are likely to recommend your products and services.
d. Advocates of a company are more likely to pay premium prices to a supplier they know and trust.
e. Retaining exiting customers prevents competitors from gaining market share.
f. A 5 percent reduction in the customer defection rate can increase profits by 25 to 85 percent, depending on the industry. (Cook stated in Mattsson, 2009:11)
Exceeding the value offered by competitors is the key to marketing success. Consumers decide upon purchases on the judgements about the values offered by suppliers. Once the product is bought, customer satisfaction depends upon its perceived performance compared to the buyer’s expectations. Customer satisfaction occurs when perceived performance matches or exceeds expectations. Expectations are formed
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39 through post-buying, experiences, and discussions with other people, and suppliers marketing activities. Companies need to avoid the mistake of
setting customer expectations too high through exaggerated promotional claims since this can lead to dissatisfaction if performance falls short of expectations. (Jobber stated in Mattsson, 2009:12)
Customer satisfaction research is focused on company’s current customers to clear up functionality in proportion to customer’s expectations. Amount of - or repeatedly happening purchasing doesn’t always tell about customer’s satisfaction. Customer may buy product, because there is not better available, or he / she doesn’t know any other alternatives. In this kind of case, customer is not committed to a company or a product, but moves over to another alternative as soon as it will be available.
Research measures total customer satisfaction and also divisions of it, e.g. products, price, quality, customer service etc. Most important is that research is reliable, repeated often, results are analysed and problematic points are solved. (Bergström,Leppänen, Yrityksen Asiakasmarkkinointi stated in Mattsson, 2009:12)
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40 F. Previous Research
Researcher Research Title Research Result Japarianto and
Djati (2011)
The Effect of Service Retail Marketing Mix Towards Shopping Satisfaction of Tourism Shopper At Plaza-Plaza
Surabaya
a. Variables of service retail marketing mix contained in Plaza Plaza Surabaya together have an influence on the level of satisfaction tourism
shopper. But after the study authors found several
variables such as retail price, merchandise assortment and customer service does not have a significant effect on the level of tourism shopper satisfaction when compared with other variables.
b. That the store design variables are the variables that most influence on the level of tourism satisfaction shopper compared with six other variables. or in other words the variable store design is the most influential variable
Wijaya et al. (Uploaded in
2013)
The Analysis of Retail Mix Toward Customer Satisfaction in 39 Store
Semarang
a. Customer Service
Variable customer service has become a significant variable and positively affect customer satisfaction partially at Shop
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41 Researcher Research Title Research Result
39 Semarang is a significance value of 0.001 under 0:05. b. Location
This location variables become significant variables affecting customer satisfaction partially in Store 39 Semarang is a significance value of 0.010 under 0:05.
c. Pricing
Variable pricing is becoming a significant variable affecting customer satisfaction partially in Store 39 Semarang is a significance value of 0.025 under 0:05.
d. tore Design and Display Variables store design and display it becomes a significant variable affecting customer satisfaction partially in Store 39 Semarang is a significance value of 0.012 under 0:05
e. Merchandise assortments Variable merchandise
assortments become
significant variables affecting customer satisfaction partially in Store 39 Semarang is a
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42 Researcher Research Title Research Result
significance value of 0.001 under 0:05. Regression coefficient merchandise assortments for 0.225 indicate that the merchandise assortments positive effect on customer satisfaction in the shop 39 Semarang, this means that if the merchandise assortments, the better, it will increase customer satisfaction in the shop 39 Semarang. f. Communication Mix
Communication mix variables become significant variables affecting customer satisfaction partially in Store 39 Semarang is a significance value of 0.046 under 0:05.
Pasaribu and Sembiring
(2013)
The Effect of Retail Marketing Mix Strategi Towards Satisfaction and
Loyalty of Customer at Syariah MES Mart
Minimarket .
Effect of Retail Marketing Mix
Strategy for Customer
Satisfaction
a. Effect of Customer
Satisfaction MES Mart Sharia The results showed that the product has a positive and significant effect on customer satisfaction . That is, the better the product strategy
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43 Researcher Research Title Research Result
undertaken by MES Mart , the greater the satisfaction felt by the customer . The degree of influence between product and customer satisfaction is large enough, it can be seen from the regression coefficient of b. Effect of Price on Customer
Satisfaction MES Mart Sharia The results showed the price factor has a positive but not significant effect on customer satisfaction . This means that the better the pricing policies do MES Mart , the greater customer satisfaction , but the price in this case does not affect a customer is satisfied or not .
c. Effect of Location of MES Mart Customer Satisfaction Sharia
The results showed that the location has a positive and significant effect on customer satisfaction . That is, the location is one factor that can determine whether a customer is satisfied or not .
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44 Researcher Research Title Research Result
d. Effect of Customer
Satisfaction MES personnel Sharia Mart
The results showed that the
personnel is the most
influential factor in customer satisfaction. Personnel have a positive and significant effect on customer satisfaction . With a large degree , it can be said that the personnel of the
factors that determine
customer satisfaction Mart mini MES compliant.
e. Influence Presentation on
Customer Satisfaction MES Mart Sharia
Results showed that the effect of presentationpositive and significant effect on customer satisfaction .Based on the test , it can be concluded the retail
marketing mix strategies
adopted by the company consists of product, price , location , personnel and
presentation simultaneously
affect customer satisfaction Mart mini MES compliant.
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45 G. Frame of Thinking
The framework in this study illustrate the relationship of the independent variable customer service (X1), store design and display (X2), communication mix (X3), location (X4), merchandise assortment (X5), and pricing (X6) towards dependent variable customer satisfaction (Y)
According to what the researcher has explained in previous section, the framework in this research is showed in figure 2.4.
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46 Figure 2.4
Conceptual Thinking Store Design
and Display
Communication Mix Customer
Service
Merchandise Assortment
Location Pricing
Customer Satisfaction
Validity Test Reliability Test
Normality Test Multicolliniaerity
Test Heteroscedasticity
Test
Multiple Linear Regression Coefficient of Determination
T Test F Test
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47 H. HYPOTHESIS
The hypothesis is an unproven statement or proposition about a factor or phenomenon that is of interest to the researcher (Malhotra, 2004:49). Based on the formulation of the problem, the theoretical basis and framework mentioned above, the hypothesis proposed in this study are:
H01:Customer service (X1) has no significant influence towards customer satisfaction(Y).
Ha1:Customer service (X1) has a significant influence towards customer satisfaction (Y).
H02:Store design and display (X2) has no significant influence towards customer satisfaction (Y).
H02:Store design and display (X2) has a significant influence towards
customer satisfaction (Y).
H03:Communication mix (X3) has no significant influence towards customer
satisfaction (Y).
H03:Communication mix (X3) has a significant influence towards customer satisfaction (Y).
H04:Location (X4) has no significant influence towards customer satisfaction (Y).
H04:Location (X4) has a significant influence towards customer satisfaction (Y).
H05:Merchandise Assortment (X5) has no significant influence towards
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48 H05:Merchandise Assortment (X5) has a significant influence towards
customer satisfaction (Y).
H06:Pricing (X6) has no significant influence towards customer satisfaction (Y).
H06:Pricing (X6) has a significant influence towards customer satisfaction (Y). H07:Customer service (X1), store design and display (X2), communication mix
(X3), location (X4), merchandise assortment (X5), and pricing (X6) have no significant influence towards customer satisfaction (Y).
H07:Customer service (X1), store design and display (X2), communication mix
(X3), location (X4), merchandise assortment (X5), and pricing (X6) have a significant influence towards customer satisfaction (Y).
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49 CHAPTER III
RESEARCH METHODOLOGY
A. Scope of Research
This research is conducted to analyze the influence of retail marketingmix (customer service, store design & display, communication mix, location, merchandise assortment, and pricing) towards customer satisfaction at SB Mart in Bukit Sawangan Indah Housing.
.The determination of target is customers of SB Mart Bukit Sawangan Indah Housing. It is because SB Mart has the distinctive competence and the customers come from everywhere not only people who live in Bukit Sawangan Indah Housing.The research period starts from August 2014 until the completion writing
B. Population and Sample 1. Population
Population is a generalization area consist of object or subject which has certain quality and characteristic that is appointed by researcher to be analyzed than generated conclusion (Sugiyono, 2008:61). Population in this reserach is all customers whose have ever shopped at SB Mart in Bukit Sawangan Indah Housing.
2. Sample
Sample is a part of amount and characteristic owned by the population (Sugiyono, 2008:62). Sampling technique used in this research is non
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50 probability sampling where all population don't have same opportunity to become respondents and sampling is based on researcher consideration (Simamora stated inKoentjoro and Subagio, 2013:2).
In this research use 100 respondents for collectiong data. The use of these 100 questionnaires with technical reason because the proper sample for this research 30 to 500 people. (Sugiono, 2008:74).
The characteristics of the respondents were used as samples in this study were:
1. Consumers who shop at SB Mart in Bukit Sawangan Indah Housing. 2. Minimum age 17 years, this is because at that age consumees are able
to provide concrete assessment.
C. Data Collection Method
The type of data obtained, can be grouped into: 1. Primary Data
Primary data is data originated by the researcher specifically to address the research problem (Malhotra, 2004:37). In this study, primary data obtained from questionnaires regarding consumer response with regard to customer service, store design and display, communication mix, location, merchandise assortment, and pricing that influence customer satisfaction.
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Appendix 4 : Validity and Reliability Test
Question of
Numbers
Standard
Value (r
table)
Corrected
Item-Total
Correlation
Value
Result
1
0.444
0.640
Valid
2
0.444
0.829
Valid
3
0.444
0.575
Valid
4
0.444
0.581
Valid
5
0.444
0.625
Valid
6
0.444
0.663
Valid
7
0.444
0.493
Valid
8
0.444
0.526
Valid
9
0.444
0.799
Valid
10
0.444
0.799
Valid
11
0.444
0.799
Valid
12
0.444
0.492
Valid
13
0.444
0.865
Valid
14
0.444
0.865
Valid
15
0.444
0.784
Valid
16
0.444
0.784
Valid
17
0.444
0.784
Valid
18
0.444
0.779
Valid
19
0.444
0.875
Valid
20
0.444
0.794
Valid
21
0.444
0.674
Valid
22
0.444
0.667
Valid
23
0.444
0.543
Valid
24
0.444
0.634
Valid
25
0.444
0.809
Valid
26
0.444
0.809
Valid
27
0.444
0.778
Valid
28
0.444
0.684
Valid
29
0.444
0.843
Valid
30
0.444
0.779
Valid
31
0.444
0.490
Valid
32
0.444
0.688
Valid
33
0.444
0.626
Valid
34
0.444
0.759
Valid
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Question of
Numbers
Standard
Value (r
table)
Corrected
Item-Total
Correlation
Value
Result
39
0.444
0.506
Valid
40
0.444
0.506
Valid
41
0.444
0.548
Valid
42
0.444
0.679
Valid
43
0.444
0.465
Valid
44
0.444
0.627
Valid
45
0.444
0.663
Valid
46
0.444
0.674
Valid
Reliability Statistics
Cronbach's Alpha N of Items
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Appendix 5 : Output SPSS
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One-Sample Kolmogorov-Smirnov Test
Unstandardized Residual
N 100
Normal Parametersa,,b Mean .0000000
Std. Deviation 1.45660083
Most Extreme Differences Absolute .049
Positive .049
Negative -.045
Kolmogorov-Smirnov Z .493
Asymp. Sig. (2-tailed) .968
a. Test distribution is Normal. b. Calculated from data.
Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients
t Sig.
Collinearity Statistics
B Std. Error Beta Tolerance VIF
1 (Constant) 5.749 2.415 2.381 .019
Customer Service .142 .053 .277 2.691 .008 .717 1.396 Store Design and
Display
-.031 .067 -.045 -.459 .647 .798 1.254
Communication Mix -.070 .072 -.096 -.966 .336 .768 1.302 Location -.070 .060 -.114 -1.179 .242 .811 1.232 Merchandise
Assortment
.240 .130 .188 1.850 .068 .734 1.362
Pricing .483 .136 .351 3.560 .001 .783 1.277
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Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients
t Sig.
B Std. Error Beta
1 (Constant) 5.232 1.398 3.744 .000
Customer Service -.039 .030 -.148 -1.285 .202
Store Design and Display -.026 .039 -.075 -.684 .496
Communication Mix -.020 .042 -.054 -.484 .630
Location -.061 .035 -.191 -1.769 .080
Merchandise Assortment .130 .075 .196 1.729 .087
Pricing -.088 .078 -.123 -1.118 .267
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Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients
t Sig. B Std. Error Beta
1 (Constant) 5.749 2.415 2.381 .019
Customer Service .142 .053 .277 2.691 .008
Store Design and Display
-.031 .067 -.045 -.459 .647
Communication Mix -.070 .072 -.096 -.966 .336
Location -.070 .060 -.114 -1.179 .242
Merchandise Assortment .240 .130 .188 1.850 .068
Pricing .483 .136 .351 3.560 .001
a. Dependent Variable: Customer Satisfaction
ANOVAb
Model Sum of Squares df Mean Square F Sig.
1 Regression 86.593 6 14.432 6.390 .000a
Residual 210.047 93 2.259
Total 296.640 99
a. Predictors: (Constant), Pricing, Location, Store Design and Display, Merchandise Assortment, Communication Mix, Customer Service
b. Dependent Variable: Customer Satisfaction
Model Summaryb
Model R R Square
Adjusted R Square
Std. Error of the Estimate
1 .540a .292 .246 1.50285
a. Predictors: (Constant), Pricing, Location, Store Design and Display, Merchandise Assortment, Communication Mix, Customer Service b. Dependent Variable: Customer Satisfaction