The Effect of Retail Service Quality and Product Quality on Customer Loyalty

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Table of Contents

Summary of Key Issues in the Article
The Article’s Contribution and Support to Quality Management Principles
Discuss How the Content of the Article Relates to Quality Theory
Writer’s Findings and Application
Conclusion
Reference List

Summary of Key Issues in the Article

The above quality management journal focuses on the effects of retail service quality and product quality dimension, with Hong Kong being its location of study. When the economy faces recession, success is based on how retailers are able to acquire customer loyalty by responding to customers’ demand.

Customer loyalty is brought about by a long-term and stable relationship between the customer and the business owner. Needless to say, customers are highly concerned with quality of services, which is a major contributor to customer loyalty.

This article emphasizes on physical aspects, personal interaction, policy, reliability and problem solving as impacts of retail service quality (Yuen & Chan, 2010, p224). For instance, when individuals are asked to name their expectations and perceptions on a service, they tend to rate the former services higher. Retail service quality scale is a tool that has been rated as effective when dealing with retail businesses.

Retail businesses can fall under several dimensions, the first one being personal interaction whereby, owners are helpful to customers thus earning their trust and confidence. Secondly, policy involves operating hours, payment options, and parking space, which are required to be effective.

Thirdly, physical aspect involves the appearance of the business and reliability whereby, the retailer fulfills his promises to the customers (Yuen & Chan, 2010, p.224). The authors further describe product quality in regard to eight dimensions, including “performance, conformance, features, reliability, serviceability, durability, customer perceived quality and aesthetics” (Yuen & Chan, 2010, p.224).

However, only three dimensions are emphasized on. They include durability, which is a measure of a product life; serviceability, which refers to the speed and competence; and aesthetic and customer- perceived quality, which defines product quality construct.

Customer loyalty is defined as a positive feeling towards a certain product or service, hence always re-purchasing of that product or service (Yuen & Chan, 2010, p225). Loyal customers are willing to spend much more compared to less loyal customers, hence becoming an important asset to the business.

However, there are two types of customer loyalty; person- person loyalty and person to firm loyalty, whereby, firm relationships are short-term compared to person – person relationships. Therefore, the link between retail service quality and customer loyalty lies in the fact that good service may lead to customer loyalty. There is a possibility that positive perceptions of service quality may increase the chance of a customer to be more involved in the firm.

The link between product quality and customer loyalty is evident: when a product satisfies customer’s needs, and thereafter, a customers communicates the positive aspect of that products to others, thus showing a high degree of customer loyalty. Therefore, for a firm to operate successfully, it should focused on product’s quality.

A research carried out by Yuen & Chan on a curtain retail shop indicated that the respondents had a positive attitude towards the retail service quality of the store. However, the personal interaction dimension acquired the highest score, thus reflecting the respondents’ satisfaction on service provided at the Hunter Douglas retail.

Aesthetic scored a mean of 5.59, indicating that the retail shop offered unique products, while customer loyalty was at 4.88, an indication that the respondents had a higher level of loyalty to the employees at the shop other than to the firm itself (Yuen & Chan, 2010, p.231).

Therefore, the findings in this article conclude that retail service quality is linked to customer loyalty positively; however, product quality does not have a positive impact on customer loyalty. In addition, personal interaction was found to have a positive impact on customer loyalty to the employees, whereas physical aspect, reliability, and problem solving had a positive influence on customer’s loyalty to the retail shop (Yuen & Chan, 2010, p.237).

The journal by Ojinnaka (2011, p.590) argues that quality is defined by the degree of excellence or superiority in a product, while quality improvement involves change that involves a process of improving the product. However, quality control is necessary, as it involves laws that ensure consumers are prevented from any danger by ensuring that they get the right quality and weight of a product, especially when food is involved.

Ojinnaka agrees that total quality management directs employee’s efforts towards customer satisfaction. In addition, total quality management is said to not only involve an organization, but also the employees. However, Ojinnaka’s journal fails to identify dimensions of product quality and customer loyalty in relation to product and service quality.

The Article’s Contribution and Support to Quality Management Principles

According to Naik, Gantasala, & Prabhakar (2010, p.241), five dimensions of service quality are evident including tangibility, responsive, assurance and empathy. These dimensions are considered to have impact on a customers’ satisfaction. Just as the main article, this article focuses on retail service quality, where quality is emphasized on as the key towards attracting clients. Tangible items are measured according to their appearance.

In addition, customer satisfaction is emphasized on and just like in Yuen & Chan article, customer satisfaction is related to profitability. For instance, when a customer perceives quality service, he will market the business by informing his friends (Naik, Gantasala, & Prabhakar, 2010, p.242).

Kanji & Asher (1996, p.1) further add that, total quality management comprises four principles. The first is delighting the customer by doing what interests them the most. The second one is management by fact, whereby, product improvement is primarily based upon facts.

The third principle is people-based management, whereby, teamwork is encouraged, as it contributes to the quality of a product or service. Lastly, continuous improvement focuses on an improvement cycle that is directed towards customer satisfaction. These principles are evident in Yuen & Chan’s article, as it focuses on customer loyalty as a result of customer satisfaction.

Yuen & Chan’s article has incorporated some of the management principles, but they have mostly specified on customer focus through creating of customer’s loyalty and ensuring customer satisfaction (Yuen & Chan, 2010, p.225). Continuous improvement of products is emphasized on and this proves that the curtain retail shop received customer loyalty due to its uniqueness. Therefore, the shop is willing to market the business by telling others about its products and services.

Discuss How the Content of the Article Relates to Quality Theory

Yuen & Chan’s article focuses on how retail service quality is related to customer loyalty; therefore, the article insists on quality throughout. Quality is defined as the customer’s perception on the product or service offered (Yuen & Chan, 2010, p.223). Therefore, the quality of a product can be measured via its feature, performance, reliability, durability serviceability among other factors. Nevertheless, quality service or product is key to enhancing customer satisfaction, which in time creates customer loyalty.

When customers have a positive perception about a product or service, they tend to repurchase the product. Therefore, there is a link between product quality and customer loyalty, whereby, quality of a product contributes to customer’s satisfaction.

According to Yuen & Chan (2010, p.227), it is evident that quality revolves around meeting a customer’s expectations; therefore, achieving quality is always a continuous process, especially for organizations seeking a competitive advantage. However, quality improvement process involves the organization and its staff as a whole.

According to Liang (2010, p.66), quality is essential in an organization’s strategy, whereby, it involves inspection of products with an aim of eliminating any defects. The author further adds that theoretically, quality is defined as customer satisfaction. In addition, different tools have different impacts on quality improvement in an organization.

Yuen & Chan’s article focuses on quality and customer loyalty, whereby, they emphasize that quality definitely contributes to customer’s loyalty in relation to quality theory. It is rather clear that quality is important to any organization in relation to their products and services, as it contributes greatly to customer’s satisfaction.

Writer’s Findings and Application

Yuen & Chan’s findings indicate that retail service quality is positively related to customer loyalty; however, product quality does not contribute positively to customer loyalty based on research. In addition, three dimensions were found to have a positive impact on customer loyalty; they include physical aspect, reliability, and problem solving. Physical aspect involves a business layout including the attractive products being sold which give a customer a good impression.

Problem solving is evident in this study and it implies that customers ask for help since they cannot solve the problems on their own, hence, they need assistance from staff to tackle the problem. When a customer’s problem is solved, the customer is satisfied, hence is likely to market the curtain shop to others.

In addition, the chance that a customer will repurchase the items is very high. Findings of this research also revealed that customers’ relationship to the store was high as compared to the staff relationship. This is as a result of the great services offered by the staff which in return attribute to the customers’ attachment to the store.

In the modern world, customer’s perception on a product or service can either contribute to higher sales of a business or not. This is because most customers are keen on quality of an item rather than its price. Customer loyalty in this study was measured in two groups – the store and the staff.

These findings can be applicable in modern organizations, whereby, the business owner emphasizes on quality as the key towards a competitive business. Secondly, in case a business is trying to attain a competitive advantage, the manager should ensure that the staffs are well trained, especially on communication and customer service. This will aid in assisting customers while shopping and on fast problem solving process.

Yuen & Chan’s findings indicate that personal interactions played a significant role in customer loyalty; this was evident in the interactions between a customer and the staff. Such interactions in a business create a strong relationship between the staff and customers, hence creating loyalty in customers.

According to Faed (2011, p.141), customer relationship management is important in an organization, as it increases business intelligence, effective decision-making and enhances customer relations. Therefore, there is need for training employees on issues relating to customer handling, such as customer service and marketing.

Conclusion

Yuen & Chan’s article acknowledges customer’s loyalty & product quality which are some of the principles of quality management. In addition, gender is considered in terms of customer loyalty, since this research included both female & male genders, whereby, the multiple regression hypothesis was applied.

This article portrays the rule of quality management which is guided by several principles aimed at providing customer satisfaction, and improved performance. It contains quality control, quality assurance and quality improvement. These components result in a desired level of excellence in customers.

Organizations tend to depend on customers since they are the determinants of sales made. Business gains customer loyalty when the needs of customers are considered and fulfilled, thus, repurchasing is evident and returns are high. However, this article covers only one type of store, hence, research is centralized, as many purchasers are likely to be women.

Reference List

Faed, A., 2011. The Impact of Integrated TQM and Interactivity on Customer Retention Process. International Journal of Information Processing and Management, 2(2), pp. 139-150.

Kanji, G., and Asher, M., 1996. 100 methods for total quality management. London: Sage Publisher.

Liang, K., 2010. Aspects of Quality Tools on Total Quality Management. Modern Applied Science, 4 (9), pp. 66-74.

Naik, K., Gantasala, S., and Prabhakar, G., 2010. Service Quality (Servqual) and its Effect on Customer Satisfaction in Retailing. European Journal of Social Sciences, 16 (2), pp. 167-315.

Ojinnaka, M., 2011. The food industry in Nigeria: development and quality assurance. Asian network for scientific information. Journal of Nutrition, 10 (6), pp. 589-593.

Yuen, E., & Chan, S., 2010. The effect of retail service quality and product quality on customer loyalty. Journal of Database Marketing & Customer Strategy Management, 17, pp. 222-240.

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