CHAPTER 2
LITERATURE REVIEW
2.1. Theory Description
2.1.1. Need Description
In general, Kotler (2000, p.11) says needs describe basic human requirements. A
person’s needs of product and services can appear if the condition at present does not
fulfill his or her expectations. But to understand what are customer’s needs is not easy,
because their needs may be different from person to person. In his book, Kotler (2000,
p.21) stated that customers needs can be classified as follows:
•
Stated needs: are the needs that stated by customer although sometimes it is not
clear enough.
•
Real needs: is the needs that the customer really want
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Unstated needs: are the needs that not stated by customer. They just hoping that
the company understands their needs and the marketing department must know
either.
•
Delight needs: are the needs that only to make customer feels happy.
•
Secret needs: are the needs that occur to fulfill customer who prioritize quality
and value to pride themselves.
Many organizations believe that a good customer management starts and ends with
understanding their customers’ needs. From many cases of companies in the world, we
can learn that companies whose products and services failed to understand the needs and
requirements of their customer might fail in their business. Another author, Peters (1994,
p.46)
explains, if a company wants to get a complete understanding of their customers’
needs, there are three main issues involved. There are :
1. Understanding near and long-term customer requirements
In this area companies need to consider the market segmentation by studying the
situation and collecting information about product and service features. All of the
information learned from the findings must be compared in order to optimize
successes in the future
2. Projecting future customer requirements and expectations.
In this area companies need to consider the time horizon for the determination,
understand the external factor, which would influence customers, study the
competitors and develop new product and services.
3. Determining customer requirements.
In this area companies need to prepare condition for new market opportunities in
accordance with time determination.
2.1.2. Customer Satisfaction
In the world of competition today, companies are trying to find out how to win
customers and outperforming competitors. According to Kotler (2000, p.36) customer
will buy products and services from the company that can satisfy them. In general,
satisfaction can be described as “a person’s feelings of pleasure or disappointment
resulting from comparing a product’s perceived performances in relation to his or her
expectations”. If the satisfaction level falls, customer is dissatisfied and will switch to
another company that offers better.
The key to maintain the customer retention is customer satisfaction. A highly
satisfied customer might:
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Stays loyal longer.
•
Buys more as the company introduces new products and upgrades existing
products.
•
Talks favorably about the company and its products.
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Pays less attention to competing brands and advertising and is less sensitive to
price.
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Offers product or service ideas to the company.
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Cost less to serve than new customers because transactions are routine.
There are several dimensions of quality of service. They are (Bergman & Klefsjo 1994, p.79)
•
:
Tangibles, refers to physical environment, for example the equipment, personal and
their clothing
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Reliability, which is the ability to do the consistency in service and dependability.
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Responsiveness, have the willingness to help the customer.
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Competence, the ability and knowledge in doing service to customer.
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Courtesy refers to supplier’s background.
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Credibility, can be trusted and honesty of the service provider.
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Security, it acquitted from danger, risk and uncertainty.
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Accesses, easy to be reach and contact by customer.
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Communication is the ability to communicate with customer using simple language.
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Empathy, always try to understand customers and their needs.
Furthermore, in the book of marketing management, Kotler (2000, p.153) says, that there
are several methods of tracking and measuring customer satisfaction :
•
Complaint and suggestion systems
The company gives a suggestion and complaints form. Such in restaurants or
hotels for guests to report their opinion. But usually not all of the customers want
to fill the complaints.
•
Customer satisfaction surveys
Like in this research, company does a survey to measure customer satisfaction
using such as questionnaire or by phone calls to a random sample of their
customers.
•
Ghost shopping
This method use a person to pose as potential buyer to report their findings on
strong and weakness points when experiencing buying the company’s and
competitor’s products.
•
Lost customer analysis
The company contact customers who have stopped buying or switched to another
supplier to learn why this condition happened.
•
Some caution in measuring customer satisfaction.
The company must make a well-structured questionnaire; otherwise the customer
would face a huge questionnaire. The company must also be able to recognize that
two customers can report being highly satisfied for two reasons. One person
maybe easily satisfied most of the time, and the other one might be hard to please
but was pleased on this occasion.
2.2. Internet
Internet or sometimes called “ The Net” is a networked computer, which
connected each other around the world and becomes worldwide network computer
system. From Internet, users may exchange information and even voice, from a Personal
Computer for instance to another computer located in the other part of the world.
An Internet Service Provider can be described as a company that provides
individuals and corporate access to the internet and other related services such as website
building and website hosting. An ISP has the equipment and the telecommunication line
access required to have POP (Point Of Presence) on the Internet for the geographic area
served. Many big ISPs usually have their own high speeds leased lines so that they are
less dependent on the telecommunication providers and can provide better service to their
customers.
Most of ISPs nowadays, have provided Internet facility such as follows:
•
World Wide Web (WWW) or Web is a page in hypertext format, where people
can see a lot of information and promotions by using a web browser.
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E-mail or electronic mail is a facility for people to send and receive mail
electronically using email software, instead of regular post office mail.
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Mailing list is a facility for people to make groups and discuss together about one
subject.
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File Transfer Protocol (FTP) is a facility for people to download and upload files
from a specific FTP server.
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Internet Relay Chat (IRC) is a facility by using text application software to
communicate between 2 or more computers together at the same time.
•
Internet Telephony is a facility in the Internet by using software, sound card,
speaker and microphone; people can talk just like a regular phone.
2.3. Relevant Research
A research journal by Parasuraman, Zeithaml, and Berry (1985, p.16) stated that
reliability; responsiveness, assurance, empathy and tangibles are the five determinant of
service quality. Reliability is the ability to perform the promised service dependably and
accurately. Responsiveness is the willingness to help customers and to provide prompt
service. Assurance is the knowledge and courtesy of employees and their ability to
convey trust and confidence. Meanwhile, empathy is the provision of caring,
individualized attention to customers, and tangible is the appearance of physical facilities,
equipment, personnel, and communication materials.
According to a journal by Kevin M. Savetz (1995, p.32), there are some
considerations when people choose an ISP. The consideration are summarize as follows:
a. Cost
Cost becoming primary factor in choosing an ISP. Some of ISPs charge a flat rate
for unlimited online time, while others charge by hourly and by the amount of
data was transferred.
b. Local access
People should aware not only for the ISP’s charge, but also for the telephone cost.
If the ISP does not have a local access, there will be an extra long distance
telephone charges.
c. Speed
People should find out what is the fastest connection that the ISP can support.
d. Interface
The interface here means the minimum requirement of the hardware needed when
connect to the Internet.
e. Storage space
Many ISP have a limit for user’s email and personal homepage capacity
f. Software
There are many Internet softwares available, but people should ask their ISP
about the software that match with their service.
g. Access Restriction
Each ISP has their own policies, people should find it out before they sign up.
h. Reliability and Performance
The issues when connecting to the Internet are : difficulties to log in, the busy
lines, server is down, and slower connection. These have becoming a major
impact of reliability and performance of the ISP.
i. Security
Many people are worried about the security of their private information. They are
worried about what if someone can steal their information or read their personal
email. People should find out what is the system administrator about this matter
j. Customer Support
People sometime need help of someone due their technical problem of Internet. A
good ISP must have a good support team that can be reached by phone or email.
2.4. Hypothesis Research
According to the theory and relevant research above, these have raised two prefix
hypotheses, which are :
•
Firstly, there is an indication that price, access, speed, features, reliability
performance and also Customer support factor correlate to Internet user
satisfaction.
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Secondly, there is an indication that price, access, speed, features, reliability
performance and also Customer support factor have significant impact to the
Internet user satisfaction.