The Influence of Extended Warranty Policy in Malaysian Culture Perspective:
A Case Study in Automobile
AMRO OSMAN WIDAA
A project report submitted in partial fulfillment
of the requirements for the award of degree of
Master of Science (Information Technology – Manufacturing)
Faculty of Computer Science and Information System
Universiti Teknologi Malaysia
November 2008
iii
To my father soul, I hope ALLAH shower him by his mercy…..
To my mother who has made every miracle given….
To my beloved sister, which is always support me
To my respected supervisor
Thank you for every thing.
iv
ACKNOWLEDGEMENT
In The Name Of Allah, Most Gracious, Most Merciful
First and foremost, I wish to express my sincere appreciation to my
project report supervisor, Mr.Hairudin Majid, for his precious guidance,
encouragement, constructive criticisms, advice, knowledge and motivation.
Without his continual support and interest, this project report would not have
been that same as presented here.
Besides that, my highly appreciation extended to my family, especially
my mother and my elder sister, for their continual supports and encourages. Also
I would also like to express my thanks to all my fellow postgraduate master
course maters for their support. My sincere appreciation also extends to all my
colleagues, friends and other who have provided assistance at various occasions.
Their views and tips are useful indeed. Unfortunately, it is not possible to list all
of them in this limited space, love and care.
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ABSTRACT
The term of extended warranty has recently appeared in Malaysia industrial
market, although it has appeared in the developing countries for quite since the passage
of the Magnuson-Moss Warranty—Federal Trade Commission Improvement Act in
1975. Since that era, researchers and scholars has been extensively studied it.
In this paper our goal is to study the Malaysian consumers’ perception toward
the extended warranty policy, where we have taken Automobile industrial market as our
case study to support our believe that Malaysia which is one of the developing countries
in terms of industry, and the automobile market represent from the high marketing level.
From that perception, we believe that we can obtain a high investigation records in
terms of scale of consumers perception.
In this paper we have under taken a survey method as a methodology for
conducting the data collection. In particular we have designed questionnaire as our
instrumental to assist our investigation in collecting required information from the
Malaysian consumers. SPSS software has been used to aid the statistical analysis and
analyzed of the data that have been collected using the questionnaire methodology.
As a summary, by conducting our survey and gathering the data collection from
respondents, we are able to analyze our data and come out with results that can answer
our research questions and fulfill our objective.
vi
ABSTRAK
Dewasa ini istilah jaminan tambahan telah muncul dalam pasaran industri
Malaysia. Jaminan tambahan sebenarnya telah lama muncul di negara membangun iaitu
semenjak lahirnya ‘Magnuson-Moss Warranty Trade Commisison Act’ pada tahun
1975. Hal ini telah menggalakkan pengkaji dan para sarjana manjalankan kajian yang
lebih mendalam tentang jaminan tambahan.
Dalam kajian ini, matlamat kami adalah mengkaji persepsi pengguna Malaysia
tentang polisi jaminan tambahan. Kami telah memilih pasaran industri automotif di
Malaysia sebagai bidang kajian
kerana Malaysia merupakan sebuah negara
membangun di dalam konteks industri manakala industri automotif mewakili tahap
pemasaran yang tinggi. Berdasarkan persepsi tersebut kami yakin akan memperolehi
rekod kajian yang baik dalam konteks skala persepsi pengguna.
Kami juga telah menjalankan kaedah tinjauan sebagai salah satu kaedah untuk
mengumpul data. Oleh itu, kami telah mengedarkan borang soal selidik untuk
membantu kami mendapatkan maklumat yang diperlukan. Perisian SPSS digunakan
untuk menjalankan operasi statistik dan menganalisa semua data yang telah dikumpul
daripada borang soal selidik.
Kesimpulannya dengan menjalankan tinjauan dan mengumpul data daripada
responden kami dapat menganalisa koleksi data. Keputusan kajian yang diperolehi
dapat merungkai semua persoalan kajian dan seterusnya matlamat kajian dapat dicapai.
vii
TABLE OF CONTENTS
CHAPTER
1
TITLE
PAGE
Declaration Thesis
ii
Dedication
iii
Acknowledgement
iv
Abstract
v
Abstrak
vi
Table of Contents
vii
List of Table
xii
List of Figure
xv
INTRODUCTION
1
1.1 Introduction
1
1.2 Definition of Warranty
2
1.3 Definition of Extended Warranty
3
1.4 Concept of Extended Warranty
3
1.5 Automobile Extended Warranty
4
1.6 Problem Background
5
1.7 Problem Statement
6
viii
2
1.8 Objective of the Project
6
1.9 Research Questions
7
1.10 Questionnaire Objectives
7
1.11 Scope of Project
8
1.12 Work Chart
8
1.13 Chapter Summary
10
LITERATURE REVIEW
11
2.1 Introduction
11
2.2 The History of The Malaysian Automotive Industry
12
2.2.1 Production Rate
2.3 Warranty Overview
2.3.1 Warranty Concept
2.3.1.1
Different Between Warranty And
14
16
16
17
Service Contract
2.3.2 Role of Warranty
17
2.3.2.1 Buyer’s Point of View
17
2.3.2.2 Manufacturer’s Point of View
18
2.3.3 Warranty Study
20
2.3.4 Warranty Policies
21
2.3.5 Taxonomy
22
2.4 Framework for Strategic Warranty Management
24
Warranty
2.4.1 Technical Issues
28
2.4.2 Commercial Issues
30
2.5 Extended Warranty Studies
31
2.5.1 Signaling
31
2.5.2 Risk Reduction
33
2.5.3 Cost-Benefit
34
2.6 Applicability of Prior Research to Present Study
35
ix
2.6.1 Consumer Utility
36
2.6.2 Extended Warranties in Supply Chains
37
2.6.3 Warranty Researches Conducted By Survey
39
Methodology
2.6.4 Consumer Perception Study
41
2.6.5 Consumer And Manufacturer Perception Study
43
2.6.6 Production And Extended Warranty
44
2.7 Chapter Summary
3
METHODOLOGY
47
48
3.1 Introduction
48
3.2 Justification of Method
49
3.3 Project Research Flow Chart
50
3.3.1 Design Methodology
52
3.3.2 Determination of Feasibility
53
3.3.3 Development of Instrument
54
3.3.4 Conducting Pilot Test
56
3.3.5 Revise Instruments
57
3.3.6 Conducting the Research
57
3.3.7 Data Analysis
58
3.3.7.1 Cross Tabulation
61
3.3.7.2 Chi-Square
62
3.3.7.3 Correlation
63
3.3.7.4 Hypothesis
64
3.3.7.5 SPSS
65
3.4 Project Methodology
65
3.5 Chapter Summary
67
x
4
DATA ANALYSIS
4.1 Introduction
68
4.2 Instrumental Design
69
4.3 Profile of Respondents
70
4.3.1 Respondents Variables
73
4.4 The Design and Variables of Part One
73
4.5 The Design and Variables of Part Two
74
4.6 The Design and Variables of Part Three
75
4.7 Pilot Test
76
4.8 Questionnaire Analysis
83
4.9 Hypothesis
86
4.9.1 Variables Comparison
5
68
87
4.9.1.1 Ethnic Group Comparison
87
4.9.1.2 Income Group Comparison
95
4.9.1.3 Age Group Comparison
103
4.9.1.4 Gender Group Comparison
111
4.10 Chapter Summary
119
FINDING
120
5.1 Introduction
120
5.2 Part One Result
120
5.3 Part Two Result
121
5.4 Part Three Result
123
5.6 Degree of Knowledge
124
5.7 The Reaction Towards New Policy
129
5.8 Consumers’ Attitude
134
5.9 Consumers Impression
139
5.10 Constraints
143
5.11 Chapter Summary
145
xi
6
CONCLUSION
REFERENCES
APPENDIX
146
150
A-G
154
xii
LIST OF TABLES
TABLE NO
TITLE
PAGE
Table 2.1
Production of Automotive Industry
14
Table 2.2
Production of National Cars
15
Table 2.3
Production Index of Automotive Components/Parts
15
Table 3.1
Comparing Sample
59
Table 3.2
Levels of Measurement
60
Table4.1
Definition of The Variables
77
Table 4.2
Definition of New Variables
79
Table 4.3
Descriptive Statistics of The Variables
81
Table 4.4
Ethnic Group Have an Idea about Extended Warranty
88
VS They Know the Right Definition-Cross Tabulation
Table 4.5
Ethnic group have idea about extended warranty and
90
either they bought or not VS Prefer to apply for
extended warranty-Cross tabulation
Table 4.6
Ethnic Group Have Idea About Extended And Did
Not Bought Before Vs The Interesting Toward
Extended Warranty- Cross Tabulation
92
xiii
Table 4.7
Ethnic Groups That Bought Extended With Vehicle
94
Vs Thinking Buying Extended Warranty Can Give
You Peace of Mind-Cross Tabulation
Table 4.8
Income Group Know the Right Definition VS They
96
Know Extended Warranty-Cross Tabulation
Table 4.9
Income Group That Have Idea about Extended and
98
Either They Bought or Not Vs Prefer Apply For
Extended Warranty-Cross Tabulation
Table 4.10
Income Group That Have Idea But They Did Not
Bought
VS
the
Interesting
Toward
100
Extended
Warranty-Cross Tabulation
Table 4.11
Income Group That Have Bought Vehicle with
102
Extended Warranty VS Buying Extended Warranty
Can Give You Peace of Mind-Cross Tabulation
Table 4.12
Age Group Know the Right Definition Vs Idea about
104
Extended Warranty Cross Tabulation
Table 4.13
Age Group That Have Idea About Extended Either
106
They Bought or Not VS Prefer Apply For Extended
Warranty-Cross Tabulation
Table 4.14
Age group that have idea but they did not bought Vs
108
The Interesting Toward Extended Warranty-Cross
Tabulation
Table 4.15
Age Group That Bought Vehicle with Extended
110
Warranty Vs Thinking Buying Extended Warranty
Can Give You Peace of Mind-Cross Tabulation
Table 4.16
Gender Know the Right Definition VS Idea about
112
Extended Warranty -Cross Tabulation
Table 4.17
Gender That Have Idea about Extended and Either
They Bought or Not Vs Prefer Apply For Extended
Warranty-Cross Tabulation
114
xiv
Table 4.18
Gender That Have Idea But They Did Not Bought Vs
116
The Interesting Toward Extended Warranty-Cross
Tabulation
Table 4.19
Gender Group That Bought Vehicle with Extended
Warranty Vs Thinking Buying Extended Warranty
Can Give You Peace Of Mind-Cross Tabulation
118
xv
LIST OF FIGURES
FIGURE NO
TITLE
PAGE
Figure 1.1
Project Work Flow Chart
9
Figure 2.1
Taxonomy for Warranty Policies
23
Figure 2.2
Strategy Hierarchies for New Products
27
Figure 3.1
Project Flow Chart
51
Figure 3.2
Operational Frameworks of Research Activities
66
Figure 4.1
Percentage of Gender
70
Figure 4.2
The Percentage of Age Groups
71
Figure 4.3
The Percentage of Ethnics Group
71
Figure 4.4
The Percentage Of Respondents Occupation
72
Figure 4.5
Percentage of the Idea about Extended Warranty
83
Figure 4.6
The Percentage of Bought Extended Warranty with
84
Vehicle
Figure 5.1
Ethnic Group Have Idea About Extended Warranty
125
And Know The Right Definition
Figure 5.2
Income Group Have Idea About Extended Warranty
and Know the Right Definition
126
xvi
Figure 5.3
Age Group Have Idea about Extended Warranty and
127
Know the Right Definition
Figure 5.4
Gender Group Have Idea About Extended Warranty
128
and Know the Right Definition
Figure 5.5
Ethnic Group Have Idea and Either Bought
129
Extended Warranty and They Prefer To Apply For
Extended Warranty
Figure 5.6
Income Group Have Idea And Either Bought
130
Extended Warranty and They Prefer To Apply For
Extended Warranty
Figure 5.7
Age Group Have Idea and Either Bought Extended
132
Warranty and They Prefer To Apply For Extended
Warranty
Figure 5.8
Gender Group Have Idea and Either Bought Extended
133
Warranty and They Prefer To Apply For Extended
Warranty
Figure 5.9
Ethnic Group Have Idea About Extended Warranty
135
and They Haven’t Applied For The Service Before
and Much Interest To Apply For The Extended
Warranty
Figure 5.10
Income Group Have Idea About Extended Warranty
136
And They Haven’t Applied For The Service Before
and Much Interest To Apply For The Extended
Warranty
Figure 5.11
Age Groups Have Idea about Extended Warranty
and They Haven’t Applied For The Service Before
and Much Interest To Apply For The Extended
Warranty
137
xvii
Figure 5.12
Gender Group Have Idea about Extended Warranty
139
And They Haven’t Applied For The Service Before
and Much Interest To Apply For The Extended
Warranty
Figure 5.13
Ethnic Group That Bought Extended Warranty with
140
Vehicle and Extended Warranty Can Gives Them
Peace of Mind
Figure 5.14
Income Group That Bought Extended Warranty with
141
Vehicle and Extended Warranty Can Gives Them
Peace of Mind
Figure 5.15
Age Group That Bought Extended Warranty with
142
Vehicle and Extended Warranty Can Gives Them
Peace of Mind
Figure 5.16
Gender Group That Bought Extended Warranty with
143
Vehicle and Extended Warranty Can Gives Them
Peace of Mind
Figure 5.17
People How Have Bought Extended Warranty with
144
Vehicle and the Impression about the Cost
Figure 5.18
People Who Have Bought Extended Warranty With
Vehicle and From Where Know About Extended
Warranty
145
CHAPTER 1
INTRODUCTION
1.1
Introduction
Throughout history, the concept of warranty has been around and exists in some
of early civilization. Babylonian, Assyrian, and Egyptian Eras, Ancient Hindu and early
Islamic periods), through the European Period (Roman Era, Germanic, Jewish, and
early English periods, and the early Russian Era), the Middle Ages, the Industrial
Revolution and beyond. Until the sixteenth century, protecting the buyer from fraud and
faulty workmanship has been the general purpose of warranty. When trade policy
reversed around the dawn of the industrial revolution to favor the manufacturer,
extended warranty was not a pressing issue since products were still produced locally by
people known personally to buyers.
Products were still relatively simple and easily evaluated, and any dissatisfaction
was addressed directly to the manufacturer, with word of mouth travelling fast in local
2
and tight knit communities. As communities grew, so did the acceptance of caveat
emptor or ‘‘let the buyer beware’’.
The second half of the twentieth century has seen dramatic changes in the role
and the importance of warranty in relation to product sales and services. Four main
factors responsible for this have been:
Activism of the so called' consumer movement' which resulted in greater
awareness among consumers regarding their rights and the formation of strong and
vocal groups to challenge manufacturers and force lawmakers to enact new laws to
protect consumer interests;
1. lawmakers responding to the concerns of consumers and their advocates;
2. Manufacturers acting in a reactive mode to (1) and (2); and
3. Manufacturers initiating pro-active actions using warranty as a powerful
marketing tool.
1.2
Definition of Warranty
A warranty is a contractual obligation incurred by a manufacturer (vendor or
seller) in connection with the sale of a product. In broad terms (Wikipedia), the purpose
of warranty is to establish liability in the event of a premature failure of an item or the
inability of the item to perform its intended function. The contract specifies the
promised product performance and, when it is not met, the redress available to the buyer
as compensation for this failure.
3
1.3
Definition of Extended Warranty
An extended warranty, sometimes called a service agreement, a service
contract, or a maintenance agreement, is a prolonged warranty offered to consumers
(Wikipedia). The extended warranty may be offered by the warranty administrator, the
retailer or the manufacturer. These warranties extend the period of the manufacturer's
standard warranty.
1.4
Concept of Extended Warranty
Purchasers or consumer face the risk of product breakdown. Manufacturers often
insure their customers against this risk by bundling a manufacturer’s warranty in their
products. A significant number of consumers also purchase additional insurance against
product failure in the form of an extended warranty. Typically, these extended
warranties extend the period of warranty coverage on the product. On average 27% of
new car buyers purchase an extended warranty.
Extended warranties are sold by manufacturers, but are also sold by third parties.
Third party insurers’ offer extended warranties on many different consumer durables,
including home
appliances, electronic equipment, computers, furniture, and
automobiles. Among the major insurers active in the U.S. are TRW Incorporated, VAC
Corporation, IDS Corporation, Warrantech Incorporated, and Pat Ryan Associates.
Warrantech, in collaboration with AIG Corporation, sells extended warranties in Europe
4
on a broad range of products. Some retailers also underwrite extended warranties
themselves rather than offering an insurer’s extended warranty.
1.5
Automobile Extended Warranty
A new automobile extended warranty (hereinafter called an extended warranty)
is usually defined by two limits, time and mileage. An extended warranty is expired
when either one of the two limits is reached. For example, a 5 years/60,000 miles
extended warranty means the warranty will expire either in 5 years, or when the
odometer reading reaches 60,000 miles, whichever comes first. The extended warranty
for new vehicles usually does not come into effect until the coverage under the
manufacturer warranty has expired.
Recently, most manufacturers have been offering 3 years/36,000 miles of full
coverage. As the exposure of an extended warranty is measured from the registration
date of the new vehicle, the age of any extended warranty is the time elapsed between
the registration date and the valuation date.
5
1.6
Problem Background
The Extended Warranty is coverage on specifics was rejected that kicks in after
the warranty coverage provided by the manufacturer or seller expires. Many consumers
are encouraged to buy extended warranties (also called service contracts) when they buy
vehicles or electronic appliances. In the case of appliances and electronic equipment,
extended warranties are profit for the seller and not much benefit to the buyer because
only about 3% of goods ever break down during an extended warranty period. An
extended warranty may make sense, however, if you are buying a brand new model in
the first few months after it has been manufactured.
Extended warranty has been studied for long time by researchers. Warranty and
extended warranty research conducted to date, provides insights to scholars interested in
further studying extended warranties. Some of research has found that consumers :( i)
View Magnuson-Moss Act warranties as the same or worse than pre-Act warranties and
(McDaniel and Rao 1982),(ii) May be willing to pay for better warranty protection (Rao
and Weinrauch 1976)
Therefore, it is of our interest to explore and investigate the consumer’s
knowledge and attitude toward extended warranty in this research
6
1.7
Problem statement
Extended warranty has been known and accepted by most consumers in many
developing countries. However, it is still new in Malaysia consumers at it have been
introduced in Malaysia for less than 5 years.
In Malaysia there has been little discussion about the attitude of consumers
toward extended warranty. The consumers’ awareness and acceptance of extended
warranty has not been widely discussed and studied. As an addition, the level of
acceptance among Malaysian consumers is also uncertain. Therefore, it is of our interest
to explore and investigate the consumer’s knowledge and attitude toward extended
warranty in this research.
1.8
Objectives of the Project
To review extended warranty policy in Malaysian automobile industry.
To explore consumer’s knowledge and attitude in extended warranty policy in
Malaysia.
To investigate the impact of providing extended warranty policy in Malaysian
automobile industry to local consumer.
To conduct survey to analyze the impact of extended warranty in Malaysian consumer.
7
1.9
Research Questions
Our research is to examine the consumers understanding in terms of extended
warranty policy. In particular the area of automobile warranty. A questionnaire
instrumental has been conducted to aid our investigation in this research we use likert
scale and close-end question to justify the research questions. The research questions
are:
1. What is the percentage of consumers those whom express Knowledge about the
extended warranty term?
2. Do Malaysian consumers welcome the idea to buy extended warranty as new
policy in the market?
3. Do Malaysian consumers classified as risk taker and do they interest to apply
extended warranty service when they intend to buy vehicles?
4. Does extended warranty can give Malaysian consumers peace of mind?
1.10
Questionnaire Objectives
The primary purpose of conducting a survey, of course, is to produce data that
have been helped to answer important research questions. Therefore, the objectives of
our research questionnaire are:
•
To collect the require data from population.
•
To predict the degree knowledge of consumer toward the extended warranty.
•
To find the perception of consumers.
•
To generate the frame work of study.
•
To analyze the problem.
8
1.11 Scope of Project
The research has focused on extended warranty of Malaysian automobile
industry. In particular, we have explored the degree of knowledge, of extended warranty
among Malaysian consumers. A survey has been conducted to investigate various
aspect of consumer’s attitude toward extended warranty in Malaysian industry.
1.12
Work Chart
In conducting the research, we have used Work Chart guidance for the method.
Our Work Chart has started from Preliminary study, Writing Proposal, Literature
Review, Data Collection, Analyze the Data and the last task is the Final Report Writing.
9
Figure 1.1 Project Work Flow Chart
10
1.13
Chapter Summary
In this chapter, a brief of warranty and extended warranty has been discussed
and we have been discussed about the primary objectives of this research, why we under
take Malaysia market and warranty as the case study and why extended warranty in
Malaysian market and Malaysian consumers have taken our interest to investigate about
it.
CHAPTER 2
LITERATURE REVIEW
2.1
Introduction
The automotive industry in Malaysia can be considered as one of the most
important and strategic industries in the manufacturing sector. Compared with other
industries in the manufacturing sector in Malaysia, the automotive industry has been
earmarked to boost the industrialization process so that Malaysia can be a developed
nation by 2020.
12
2.2
The History of the Malaysian Automotive Industry
Like Indonesia and Thailand, the automotive industry in Malaysia started in the
1960s. Prior to that decade, a majority of the cars used on Malaysian roads were
imported in the CBU form. In 1963 through the recommendation of the Colombo Plan
experts, the Government of Malaysia began to encourage the establishment of the
automotive industry.
The policy of encouraging assembly for automobiles and the manufacture of
component parts were announced in May 1964. Assembly plants were set up in the later
1960s in order to provide employment and to substitute imports of automobiles. To
further develop the local automotive industry and to encourage vehicles to be assembled
locally, the Government has adopted a few policies. The policies include requiring a
certain percentage of a vehicle to have parts and component that are manufacture
locally, imposing import taxes and putting a tariff system on CBU imports.
Apart from the protective tariffs that were announced in February 1966, all
distributors and dealers were required to obtain import licenses that had to be renewed
every six months. In 1967, the Government approved the operation of six assembly
plants and by December the same year, Swedish Motor Assemblies Sdn. Bhd. began its
production. Initially, the assembly plants were mainly joint venture projects between
European automobile manufacturers and local partners were previously their local
distributors. Apart from Swedish Motor Assemblies which assembled Volvo, there were
also Asia Automobile Industries Sdn. Bhd. which assembled Peugeot and Mazda
vehicles and Tan Chong Motors which assembled Nissan cars (then known as Datsun).
Even though there was a local content requirement to promote the growth of
components manufacturing, the effort was not very successful. Until the early 1980s,
there were about 15 assemblers that produce vehicles for European and Japanese
manufacturers. There were too many makes and models, causing the demand for a
13
particulars component to be low, leading to the difficulty for the manufacturers to
achieve the economies of scale.
Imports were still very high as the inputs for the assembly plants came mainly
from imported CKD form. The level of technology transfer was still low and so was the
development of human resources in the industry.
Thus the second phase of the development in the automotive industry was
started with the launching of the National Car Project, Perusahaan Automobil Nasional
(PROTON), in 1984. The project was conceived in order to guide the automotive
industry in increasing the level of technology and the development of intellectual
property of the industry.
The PROTON project, which was a joint-venture programme with Mitsubishi
Motors Corporation of Japan, began its production with the PROTON Saga model in
1985. As it has integrated manufacturing facilities promote industrial linkage and
having national brand, it was given preferential tax and duty rates.
After the success of the first national car, Perusahaan Otomobil Kedua Sdn. Bhd.
(PERODUA) was established in October 1992. It was the result of an agreement
between UMW Corporation Sdn. Bhd., Daihatsu Motor Co. Ltd of Japan, Med-Bumikar
Mara Sdn. Bhd., PNB Equity Resources Corporation Sdn. Bhd., Mitsui & Co. Ltd of
Japan and Daihatsu (Malaysia) Sdn. Bhd. PERODUA was set up to expand the
automotive product range and to further support the components and parts
manufacturing. PERODUA is the first car manufacturer in Malaysia to achieve the
prestigious ISO 9002 and ISO 9001 certification awarded by the Vehicle Certification
Agency (VCA) from the United Kingdom. The Malaysian auto market is dominated by
Malaysia's national cars, PROTON and PERODUA jointly accounted for 90 per cent of
the vehicles sold annually.
14
2.2.1 Production Rate
Even though the economic crisis has badly affected the automotive industry, one
advantage that could be found was that the depreciation of local currency has made
local productions cheaper than the imported ones. This has made local production a
little bit more competitive and slightly favorable in the export market. The improvement
in sales has boosted the production of the automotive producers.
Malaysia showed a dramatic increase in production as a direct result of
increased sales in 1998, although production tumbled by less than half that of 1997 to
just 161,709 units, production exceeded that of Indonesia and the Philippines.
Malaysia’s automotive production increased by 97.7 per cent in 1999 to 303,719 units
from 161,711 in 1998. The production has shown an upward trend in year 2000 and
2001.
Table 2.1 production of automotive industry
Source: Malaysian Automotive Association.
15
Table 2.2 production of national Cars
The trend for the production of automotive component parts is similar to those
of the vehicle production. During the economic downturn, decreased sales of PROTON
and PERODUA have badly affected the vendors who primarily cater for the
manufacturers.
Table 2.3 Production index of automotive components/parts
Source: Department of Statistics, Malaysia.
The automotive industry has played an important role in the development of the
manufacturing sector in Malaysia. With the successful implementation of the first
National Car Project, the industry has to widen its perspective to take on the challenges
ahead.
Besides gearing up its operation to meet the anticipated growth in the sector, the
industry has to strengthen its competitiveness through greater emphasis on product and
market development. The industry also has to carve a niche in the export market and
foster closer linkage with the target destinations.
16
2.3
Warranty Overview
Many manufacturers and retailers has taken product warranties as integral part
marketing strategy .Therefore, Researchers for years have been interested in the
differing perceptions consumers and manufacturers hold toward express warranties
Kelly (1986).
2.3.1 Warranty Concept
A warranty is a manufacturer’s assurance to a buyer that a product or service
is/or shall be as represented. It may be considered to be a contractual agreement
between the buyer and manufacturer entered into upon the sale of the product or service.
A warranty may be implicit or it may be explicitly stated Kelly (1986).
In broad terms, the purpose of a warranty is to establish liability among the two
parties (manufacturer and buyer) in the event that an item fails. An item is said to fail
when it is unable to perform satisfactorily its intended function when properly used. The
contract specifies both the performance that is to be expected and the redress available
to the buyer if a failure occurs.
Used products can be either consumer durables or industrial and commercial
products and these are in general bought individually although some times they can also
be bought in lots. Another related concept is that of an ‘‘extended warranty’’ or a
‘‘service contract’’.
17
2.3.1.1 Different Between Warranty and Service Contract
Kelly (1986) has mentioned about the different the difference between a
warranty and a service contract and he said that the latter is entered into voluntarily and
is purchased separately – the buyer may even have a choice of terms, whereas a
warranty is part of product purchase and integral to the sale.
2.3.2 Role of Warranty
Kelly (1986). Has mentioned about warranty role and he said warranties are an
integral part of nearly all commercial and many government transactions that involve
product purchases. The buyer (individual, corporation, or government agency) point of
view of a warranty is different from that of the manufacturer (or distributor, retailer, and
so forth). Another is the societal point of view and this includes legislators, consumer
affairs groups, the courts, and public policy decision-makers.
2.3.2.1 Buyer’s Point of View
From the buyer's point of view, the basic purpose of a warranty is to reduce the
risk that the product purchased will not perform as it should. For a more
complex/expensive product (one which has more perceived risk), a buyer is more likely
18
to select a product with an expressed warranty over a product that does not have a
warranty (Nordstrom and Metzer, 1976). The majority of respondents in their study also
indicated that they would rather have a warranty than a lower price without any
warranty.
2.3.2.2 Manufacturer’s Point of View
The first purpose of warranty from the manufacturer’s point of view is for
protection Kelly (1986). Warranty terms may, and often do, specify the use and
conditions of use for which the product is intended and provide for limited coverage or
no coverage at all in the event of misuse of the product. The manufacturer may be
provided further protection by specification of requirements for care and maintenance of
the product. A second important purpose of warranties for the manufacturer is
promotional. Since buyers often infer a more reliable product when a long warranty is
offered, this has been used as an effective advertising tool. This is often particularly
important when marketing new and innovative products, which may be viewed with a
degree of uncertainty by many potential consumers. In addition, warranty has become
an instrument, similar to product performance and price, used in competition with other
manufacturers in the marketplace.
And also from a manufacturer's viewpoint, offering a warranty results in
additional cost due to servicing of the warranty but at the same time, if used properly as
a marketing tool, increases sales and hence revenue generation. If the extra revenue
generated exceeds the warranty servicing costs, then it is more sensible to sell the
product with warranty. An analysis of this trade-off is essential for effective
management of product warranty. In this analysis, manufacturers must address the
following questions:
19
1) What is the cost of offering a specific warranty policy?
2) How does this compare with other warranty policies?
3) How does the warranty cost change with the parameters (for example, duration,
and form of rebate) of the policy?
4) How does one optimize the choice of warranty when multiple business
objectives are involved?
5) What is the optimal strategy for servicing warranty? (This would involve, for
example, establishing a policy with regard to repair/replace decisions for
repairable items.)
6) What kinds of data (laboratory, field, etc.) are needed and how should the data
be analyzed?
7) What are the optimal decisions with regard to product design and manufacture,
given that the product must be sold with a specific type of warranty policy (e.g.,
as dictated by the market place)?
The literature on product warranty reveals a large number of warranty policies
that have been studied by researchers over the last two decades•
The different type of warranties offered by manufacturers of consumer durables
and industrial products is also large. At present, there exists no proper taxonomy to put
these different policies in a proper perspective so that managers can evaluate them
effectively.
20
2.3.3
Warranty Study
Warranty has received attention of researchers because it has diversity of
purpose; therefore researchers have been studied warranty from diverse disciplines.
Warranties have been studied from many different perspectives and they deal with
different issues as illustrated by the following list.
•
Historical:
Origin and use of the notion
•
Legal:
Court action, dispute resolution, product liability.
•
Legislative:
Magnusson–Moss Act; Federal Trade Commission, warranty requirements in
government acquisition (particularly military) in the USA and the latest EU legislation.
•
Economic:
Market equilibrium, social welfare
•
Behavioral:
Buyer reaction, influence on purchase decision, perceived role of warranty,
claims behavior.
•
Consumerist:
Product information, consumer protection
•
Engineering:
Design, manufacturing, quality control, testing.
•
Statistics:
Data acquisition and analysis, database reliability analysis
•
Operations Research:
Cost modeling, optimization.
•
Accounting:
Tracking of costs, time of accrual
•
Marketing:
21
Assessment of consumer attitudes, assessment of the marketplace, use of
warranty as a marketing tool, warranty and sales
•
Management:
Integration of many of the previous items, determination of warranty policy,
warranty servicing decisions
•
Societal:
Public policy issues
2.3.4 Warranty Policies
Researchers have been proposed and studied proposed taxonomy to integrate
Warranty policy of new products. The policies are grouped into three categories (Types
A, B and C) Blschke (1991)
The Type A policies (single item sale and not involving product development)
can be divided into one and two dimensional policies. In the two-dimensional policies,
the warranty is characterized by a region in the two-dimensional plane where one axis
represents age and the other usage under a non-renewing warranty; the terms of the
warranty do not change during the warranty period. As a result, if an item fails during
the warranty period, it is rectified by the dealer and returned to the buyer without any
changes to the original warranty terms. Under a renewing warranty, the warranty terms
can change, for example, after failure, the item is returned with a new warranty either
identical to, or different from, the original warranty terms.
22
2.3.5 Taxonomy
As given in figure 2.4, the taxonomy of warranty policies can be divided into
two groups based on whether or not a policy involves product development after sale.
Policies which do not involve product development can be further divided into two subgroups - Sub-Group A, comprising policies applicable for single item sales and SubGroup B, comprising policies applicable only for the sale of groups of items (also called
block or lot sales) Blischke and Murthy(1991).
Policies in Sub-Group A can be subdivided into two further sub-groups based on
whether the policy is renewing or non-renewing. In a renewing policy, whenever an
item fails under warranty, it is replaced by a new item with a new warranty replacing
the old one. In contrast, in the case of a non-renewing policy, replacement of a failed
item does not alter the original warranty. Thus for renewing policies, the warranty
period begins anew with each replacement, while for non-renewing policies, the
replacement item assumes the remaining time of the item it replaced.
A further subdivision comes about in that warranties may be classified as
'simple' or 'combination'.
23
Figure 2.1. Taxonomy for warranty policies
W.R. Blischke and D.N.P. Murthy(1991) , Product warranty management – I:A taxonomy for warranty
policies
The free replacement and pro-rata policies (the two most commonly offered
ones) are simple policies. A combination policy is a simple policy combined with some
additional features or a policy which combines the terms of two or more simple policies.
As a result, we have four different types of policies under category A, which we have
labeled A1-A4 as shown in Figure 2.1.
Each of the above four groupings can be further subdivided into two subgroups
based on whether the policy is one dimensional or two (or more) dimensional. The
dimension of a policy is the number of variables specified in defining the warranty
limits. A one dimensional policy is almost always based on either time or age of the
item but could instead be based only on usage. In contrast, a typical two-dimensional
policy is based on time or age as well as usage. As an example, in the case of
24
automobile warranties, a warranty involving only a time limitation (two years) would be
a one dimensional warranty while a warranty involving time and usage limitation - for
example, a policy specifying 'two years or 30,000 miles, whichever comes first' - would
be a two dimensional warranty policy.
Policies in group B can be sub-divided into two categories based on whether the
policy is 'simple' or 'combination'. These are labeled B1 and B2 in
Figure 2.1.Similar to grouping A, each of B1 and B2 can be further subdivided
based on whether the policy is one dimensional or two dimensional.
Finally, policies involving product development are labeled group C. Warranties
of this type are typically part of a maintenance contract and are used principally in
government acquisition of large, complex items - for example, military equipment - or
in certain commercial transactions involving large, expensive items such as aircraft
Blischke and Murthy (1991).
2.4
Framework for Strategic Warranty Management
Many companies have failed to recognize the importance of warranties, to say
nothing of warranty strategy, and have, in fact, reduced factory warranties and
attempted to maximize profits by selling extended warranties, instead. In a discussion of
this phenomenon, Cope and Pellitier (1991) state that “American business, in other
words, has divorced the warranty from the product, making it just another saleable item.
Sadly, this only reinforces the impression that U. S. companies have no confidence in
their products.” In the long run, this strategy will not work.
25
Historically, poor warranty management has had serious financial consequences.
In 1960, Ford expanded its warranty from 90 days/4000 miles to one-year/12,000 miles.
The automobile industry saw warranty as a marketing strategy and other manufacturers
followed this lead. By 1962, Chrysler decided to offer a five-year/50,000 mile warranty
as means of reversing its sagging market share. By the late 1960s, manufacturers
discovered the consequences of this action. The warranty servicing costs ($300 million
for Ford, $580 million for General Motors and $200 million for Chrysler in 1969) had
increased significantly because product reliability and quality were not good enough to
support the longer warranty. In particular, the warranty strategy was not linked properly
to product development strategy, and as a result, it was not recognized that product
reliability was not adequate to keep the warranty costs low. In the late 1960s,
manufacturers reversed their strategy and began decreasing warranty coverage, resulting
in ill feelings among consumers.
A warranty of any type, since it involves an additional service associated with a
product, will lead to potential costs beyond those associated with the design,
manufacture and sale of the product. These costs, in fact, are unpredictable future costs.
Management of these costs is important. Warranty strategies based solely on
minimizing this cost can be called “defensive” strategies. In contrast, “offensive”
strategies view warranty in a different light. Better warranty terms lead to greater sales
(market share) and revenue. However, this increases the warranty servicing costs.
Warranty servicing costs can be reduced by improving reliability (through product
development) and better quality control. These in turn involve additional costs. These
must be integrated in the formulation of a warranty strategy. The goal of strategic
warranty management should be to achieve the stated business objectives, which can
include one or more of the following – return on investment, revenue, market share,
customer loyalty and profits. This can be achieved only when all the different strategies
(including warranty strategy) are effectively integrated from an overall business
viewpoint.
Effective warranty management must take into consideration both the
commercial and technical aspects of warranty. To be effective and successful, a
26
warranty manager must have a good understanding of the issues involved in both the
commercial and technical areas and the interrelationships amongst these issues so as to
craft the warranty strategy in the context of an overall business strategy.
Periodic re-evaluation and revision of warranty strategy is necessary for several
reasons. The main reason is that products (and services) are changing rapidly as a result
of emerging new technologies, These changes often lead to significant and relatively
rapidly occurring changes in the marketplace, in turn requiring that the various
strategies, including that for warranty, be dynamic in order to respond to new conditions
adequately.
Figure 2.2 is a schematic showing a hierarchy of strategies, beginning with the
overall business strategy of the organization. Typically a company in its long-range
planning will be considering a number of possible new products or product lines as a
part of its overall business strategy. From this will emerge a set of goals with regard to
new product development and a strategy for achieving these goals. Goals may be quite
broad, but will ordinarily include market share, profit objectives, per unit production
cost, and so forth. In planning to achieve these goals, strategies for addressing the
technological issues, as shown on the left side of Figure 2.2, and the commercial issues,
shown on the right side, must be developed. From the point of view of warranty
strategy, technology issues include the engineering aspects of product design and
manufacturing. Commercial issues in this context involve marketing and servicing
aspects. To be effective, these strategies must be coherent and integrated.
Failure to address both sets of issues adequately can seriously affect profitability
of the product. In particular, lack of attention to technological issues can lead to
inadequate product reliability and quality and hence to excessive warranty claims.
Excessive claims can also occur as a result of inappropriate warranty terms as illustrated
by the automobile industry.
Excessive claims, in turn, will lead to an increase in warranty costs and in the
number of dissatisfied customers. The consequence of this dissatisfaction is loss of sales
27
for both this and future products. Increased warranty costs and customer dissatisfaction
can also result from improper warranty servicing by either the company or its agents.
Undue delays, hidden costs to the customer, improper repairs, and inconvenience in
obtaining service will adversely affect both costs and level of dissatisfaction. The end
result is declining profits.
Figure 2.2 Strategy Hierarchies for New Products
The first step in strategic warranty management is an understanding of the
technical and commercial issues involved and their interactions, in the context of the
different stages of the product life cycle. In this way, warranty strategy addresses all
decision problems relating to warranty from a business viewpoint. In the remainder of
the section we discuss these issues.
28
2.4.1 Technical Issues
The principal determinants of direct warranty cost are the terms of the warranty
and the reliability of the items produced. Product reliability is determined primarily by
design and production choices and includes many characteristics of product
performance as well as reliability and related measures. Technological issues in this
context are those concerned with reliability, including conformance to design, methods
for testing, prediction of expected numbers and types of product failures, and the
probable cost of repair or replacement associated with each type of failure.
The technological issues for product and process design are listed in broad terms
in the first two columns of Figure 2.2. The design and development strategy is
developed in response to the basic design and reliability goals specified in the new
product strategy. From this, the strategy for building and testing prototypes follows.
This, in turn, leads to development of the final product design. A production strategy
also needs to be developed at the outset. This includes selection of raw materials,
suppliers of raw materials and out-sourced parts and components, and a process
strategy. Finally, a quality control strategy for proper monitoring of the manufacturing
process, including sampling procedures, testing schemes, acceptance standards, and so
forth, also needs to be developed.
To assure high quality in the long run, attention must be paid to this beginning
early in the product design process. Methods for reliability prediction play an important
role. Predictions are based on past experience with similar products, by analysis of
various design trade-offs, use of engineering judgment, and so forth. These predictions
are refined throughout the research and development phase, as prototypes are built,
testing is done, redesign is undertaken, and the final version of the product evolves. The
extent and cost of this process depends on the type of product and the context. It may be
a relatively straightforward process for a simple product based on existing technology,
or quite costly and time consuming if new technologies are involved.
29
Development of an effective and efficient production process deals with the
issue of producibility – process designs that minimize unit production cost while
maximizing the fraction of non-defective units produced. Feedback in both directions
between product design and production greatly enhances the chances of achieving the
goals of producibility and design effectiveness.
Ideally, the analysis and testing of both product and process should lead to a
reasonable prediction of product failure rates as a function of age. This is important
information in evaluating warranty costs. Other issues related to reliability include
maintainability, availability, repairability, and many aspects of product performance
that may, under certain circumstances, be covered under warranty. In this case,
technical issues also include the development of methods for assessing these
characteristics and application of these methods to the product being designed. In some
applications, certain performance measures may also be guaranteed under warranty. For
example, jet engine manufacturers may guarantee thrust, fuel efficiency and low noise
levels of their product. For complex systems, particularly in military applications, the
list of performance characteristics may be quite extensive.
Clearly, not all of these issues related to reliability are applicable in every
application. In order to predict warranty costs, it is necessary to decide early on what the
probable warranty terms are to be. Several possibilities may be under consideration. If
the customer is specifying the warranty terms or they are being negotiated (under a
government contract, for example), this information must be taken into consideration by
the design team.
30
2.4.2 Commercial Issues
Commercial issues include marketing, post-sale support, accounting and related
areas, and deal with pricing, selection of warranty terms, promotion, and warranty
service. Actions of competitors and the marketplace into which the product is to be
introduced are also important factors. Strategies in this area that should be developed at
the same time as the technology strategies listed in the right-hand two columns of
Figure 4.1. The two major areas that directly or indirectly involve warranty are
marketing and post-sale service. Until relatively recently, the latter has received far too
little attention, especially in the early planning stages. For the most part, warranty
remains in this category. To be effective, strategies in these areas need to be developed
concurrently, with frequent feedback from one to the other.
In developing a new product strategy, it is essential to assess the marketplace at
an early stage. From this, a marketing strategy for the new product will evolve. A
proposed advertising strategy will be a part of the marketing strategy. Assessment of the
market and the overall marketing objectives will also lead to setting of goals with regard
to pricing of the product and warranty terms to be offered.
Prediction of warranty costs is an important consideration in product pricing,
since warranty and price are key elements of the marketing strategy. If the strategy is to
convince the potential customer that the product is highly reliable by offering a longer
warranty than that of the competition, this will almost always have the effect of
increasing warranty costs.
31
2.5
Extended Warranty Studies
Express warranties have been extensively studied since the passage of the
Magnuson-Moss Warranty—Federal Trade Commission Improvement Act in 1975 (the
so-called Magnuson-Moss Act). The goal of the Act was to insure that consumers could
infer the reliability of a product from a clear articulation of its warranty (Wiener, 1985).
Since the time of the Act, scholars have examined warranties from two perspectives:
As signals of product reliability, and as a means of reducing perceived risk. A
third perspective, namely cost benefit analysis, which while not based on scholarly
research, has raised the question of the value of extended warranties.
2.5.1 Signaling
One stream of research has focused on warranties as signals of product
reliability. According to signaling theory for product reliability, the reliability of a
signal such as a warranty depends on the differential advantage between high and low
quality sellers in terms of the cost of providing the signal. As described by Boulding
and Kirmani (1993), when a high-quality producer has a cost advantage over lowquality producers, ‘‘separating equilibrium’’ occurs. This means that only
manufacturers of reliable products will offer comprehensive warranties since the
manufacturer of unreliable products cannot offer full warranty protection because that
manufacturer could not sustain the cost of meeting warranty provisions because of more
frequent product breakdowns. On the other hand, when producers of high quality
products have no cost advantage in signaling the superiority of their brands over those
of inferior competitors, then using warranties as a signal cannot occurs. Boulding and
32
Kirmani call this ‘‘pooling equilibrium’’ since reliable and unreliable firms use signals
such as warranties in the same way.
Another way of looking at warranties as signals is what Weiner (1985) call the
‘‘hidden benefit problem,’’ meaning that consumers are unable to judge by inspection
the extent to which a specific brand is, or is not reliable. In other words, the reliability is
what Darby and Karni (1973) called a ‘‘credence’’ quality, that is, information which
cannot be determined at the time of purchase. The hidden benefit problem is solved by a
‘‘signaling remedy,’’ i.e., an observable feature of a product that consumers use to infer
an important, but hidden feature. As noted by Agrawal et al. (1996, p. 422), consumers
tend to regard more comprehensive warranty terms as indicative of superior brand
reliability and that ‘‘consumers seem to believe that warranties act as an accurate and
informative signal regarding the reliability of brands’’.
Unfortunately, the research on warranties as signals of reliability is not very
consistent. For example, when manufacturers’ warranties as a signal for reliability was
tested by Weiner (1985) using Consumer Reports data, he found that, while the results
were somewhat mixed, warranties were predictors of product reliability. On the other
hand, Kelly (1986, 1988), also using Consumer Reports data, found that a brand’s
warranty did not support the theory that warranties are a signal of product reliability.
One possible explanation for this discrepancy in results may be the fact that warranties
for almost all competing brands of major appliances examined by Weiner and Kelly
were identical in terms of duration, almost always 1 year and, therefore, reflective of
‘‘pooling equilibrium’’ described by Boulding and Kirmani (1993).
33
2.5.2 Risk Reduction
A second stream of research has focused on warranty information as a means by
which consumers reduce perceived risk. The thrust of this research is that product
warranties provide consumers with a means of reducing risk since, if the product does
not perform up to expectations, the consumer has assurances that redress is possible.
Moreover, warranties are seen as a particularly effective risk-reducing method for new
and technologically complex products (Shimp and Bearden, 1982) and for products in
the early stages of the product life cycle when market penetration and consumer
knowledge and experience with the product is lower (Agrawal et al., 1996). Other
research has shown a relationship between demographics and use of warranties as riskreduction mechanism. As noted by Kelly and Conant (1991), consumers with lower
income, lower education, and larger families are more likely to purchase extended
warranties in an effort to reduce financial and performance risks. Evidence also suggests
that consumers are more likely to purchase extended warranties as the price of the
product increases (Kelly et al., 1988). This view of extended warranties as an
‘‘insurance policy’’ against repairs is consistent with industry representatives who argue
that extended warranties ‘‘deliver peace of mind and freedom from financial outlays
should purchases require repairs’’ (Keefe, 2003).
2.5.3 Cost-Benefit
A third perspective on extended warranties, which has not been examined in the
academic literature, has focused on the costs associated with extended warranties and
the likelihood of consumers deriving any benefit from their extended warranty
purchase. While manufactures’ warranties are not important determinants of consumer
purchase behavior with many products when all the warranties are the same in terms of
34
coverage and length (Gerner and Bryant, 1981), extended warranties are clearly material
components in retail purchase transactions. Industry studies have found that extended
warranties add anywhere from 10% to 30% to the purchase price in the US and as much
as 50% to the purchase price in the United Kingdom (Virr, 2002).
Moreover, extended warranties have become a growth industry, especially in the
US, as evidenced by an almost 20% growth per year. This is particularly true for
electronic retailers who report that almost half of all electronic sales are accompanied
by an extended warranty (Robertson, 2001). Part of the reason why there has been such
growth is because extended warranties represent an incredible profit center for retailers,
often with profit margins of between 40% and 77% (Menzies, 2002). For example,
Sears reported sales of over $1 billion for extended warranties (Gellene, 1992) an
Almeida (1995) reports that some retailers make as much as 75% of their gross income
from sales of extended warranties.
The reason for the very high profit margins on extended warranties is because
relatively few products covered by extended warranties are ever brought back to the
retailer for repairs. As noted by Marks of Consumers Union (2001), in a survey of
38,000 subscribers to Consumers Report covering 22 major household appliances,
Consumers Union found that for items as diverse as TVs and VCRs, dishwashers,
ranges, and microwave ovens, the percent returned for repairs was less than nine percent
(9%). According to Consumer Reports, ‘‘our latest survey results reaffirm what we’ve
said for years, extended warranties generally aren’t a good investment’’ (Marks, 2001).
Given the high profit margins associated with extended warranties, it is not surprising
that retailers promote them as heavily as an after-purchase attachment. As noted by
Menzies (2002), even when the retailer does not provide commissions to employees,
store managers’ bonuses are often based on sales of extended warranties. Retailers
would seem to have, therefore, a strong incentive to promote extended warranties and,
in doing so, create an environment with a potential for the use of deceptive marketing
practices to market these highly profitable products.
35
2.6
Applicability of Prior Research to Present Study
Consumers’ perception of the extended warranty material of one national home
appliance and electronics retailer has been examined by Gerner and Bryant (1981),
virtually all manufacturer’s warranties are 1 year (parts and labor) and, as noted by
Agrawal et al. (1996, p. 424), ‘‘if all firms offer the same warranty regardless of
differences in brand reliability, warranty contracts no longer have high predictive value
(of product reliability) because accurate discrimination is impossible from the
consumer’s point of view’’. Thus, manufacturer’s warranties cannot be a signal of
product reliability. Furthermore, since the same extended warranty contract is offered
by the retailer on all brands within a product category, the retailer’s warranty cannot
serve as a signal for product reliability across brands.
Therefore, extended warranty contracts, whether from the manufacturer or the
retailer, represent a risk-reduction device or, as an industry representative stated, a
vehicle which ‘‘deliver(s) peace of mind and freedom from financial outlays should
purchases require repairs’’ (Keefe, 2003).
36
2.6.1 Consumers Utility
Busik Choi (2006), he tried to show how consumer utility is affected by a
warranty as a signal of product quality. The most important finding of this study is that
a longer warranty in- creases consumers utility and consumers are more likely to buy
cars with longer warranties.
As expected, he find that consumers' preference for warranty is relatively more
pronounced in smaller car classes than in bigger car classes, and he also find weak
evidence that different preferences for warranties exist depending on the level of risk
aversion.
Although his study finds evidence that consumers view warranties as a signal of
product quality, there are several issues that should be addressed in further researched.
Two possible issues are finding a better measuring of risk aversion and
evaluating welfare gains from product warranties. Another interesting question might be
how competition in the warranty dimension increases the efficiency of the market based
on the fact that many firms have changed their warranty in recent years. In order to
answer those questions, the magnitude of the effect and elasticity with respect to length
of warranty should be correctly calculated. In addition, some counterfactual estimation
might help answer these questions.
37
2.6.2 Extended Warranties in Supply Chains
Kunpeng Li (2005) have developed a game-theoretical model to compare
different schemes for extended warranties in a supply chain context. Specifically, he
considered a supply chain involving a single manufacturer and a single retailer. he
studied two models with the retailer and the manufacturer, respectively, being the
provider of the extended warranty. He compared the performances of the two models in
terms of system profits, retailer profits, manufacturer profits, product pricing decisions,
and extended warranty decisions. He also benchmarked the performances of the two
models with that of a centralized system. His results show that offering extended
warranties through a retailer generates more system profit than offering it through the
manufacturer. This is because the retailer can simultaneously optimize all relevant
decision variables and, thus, acts as a central planner in the extended warranty market.
However, a similar situation does not occur when the manufacturer offers the extended
warranty. He have also analyzed and compared the optimal values of the decision
variables in the two models. He show that a centralized system will offer the longest
extended warranty while a system in which the manufacturer offers the extended
warranty will have the shortest extended warranty. He developed two parameters that
influence the profitability of the extended warranty business. He proposes channel
coordination mechanisms to eliminate the causes of inefficiency in each of the two
models. Double marginalization in the product market is shown to be the primary
source of inefficiency in the channel described in Model R. On the other hand, the
inefficiency in Model M arises because of the double marginalization in the product
market and because of the decentralization of the extended warranty market. He
proposed a product revenue sharing contract with side payments that not only
coordinates the supply chain but also achieves Pareto improvement over the wholesale
price contract in Model R. For Model M, an extended warranty profit sharing contract
along with a quantity discount scheme is shown to achieve both coordination and Pareto
improvement.
38
Also his research makes the following contribution to the operations
management literature. First, it provides a unique demand function for the extended
warranties that explicitly takes into account product demand. In line with our
observation in practice, we model the extended warranty as a “service product” with
price and time duration. Second, while a majority of the literature in extended
warranties focuses on consumer moral hazard and heterogeneity issues, his work
addresses its role in the channel competition, performance and coordination. By
adopting a game-theoretic approach, he studies the strategic interaction between the
manufacturer and the retailer as well as the interaction between the product sales and
extended warranty sales. The channel coordination and improvement mechanisms he
presents address the different causes of channel inefficiency in different models. To the
best of his knowledge, his research is the first to address these issues relating to
extended warranties in a supply chain context. Third, his model implies that extended
warranties are not merely a source of revenue. Because of the unique character of its
demand, which is dependent on product demand, extended warranties could be used
strategically in channel choices to improve system profits and product pricing decisions.
These results provide useful insights as well as qualitative guidance to practicing
managers involved in designing, setting up, and managing an extended warranty
business. Like any other model in the operations management literature, his model is
based on a set of assumptions. For simplicity, he studied the extended warranty business
using a monopolistic setting. This allowed us to isolate the impact of extended
warranties on total supply chain profits.
An important extension of his model would be to include competition in the
model. Such competition can be either between manufacturers or between retailers.
Incorporating demand uncertainties might be another useful extension and might require
a new set of coordinating contracts. His model assumes no information asymmetry. A
retailer might have private information about consumer demand. In such a scenario, the
retailer might use this information strategically to improve his profit. Another way to
extend his model could be to incorporate product design elements into his model. For
39
example, product quality can be a decision variable in the model, which affects both
product cost and the cost of the extended warranty.
2.6.3 Warranty Researches Conducted By Survey Methodology
Kelly Shuptrine (2004) had made investigation study by survey instrument
method, the purpose of his study was to determine how important warranty coverage is
in automobile purchase decisions and how well buyers understand what is covered
under their warranty. Basically, the results of the study indicate that new car buyers
don't rate warranty coverage an important factor in their purchase decision. In fact of all
the factors rated, warranty coverage came in last. This finding basically supports
Longsdorfs (1989) results on warranty coverage in the purchase of recreation vehicles.
He used to develop collection instrument to provide detailed information about
the issue of warranty coverage in purchasing an automobile. The questionnaire was
pretested on a small number of staff members at a medium-sized southeastern
university. Revisions were made as needed for clearer communication.
A portion of a two state consumer panel in the Southeast was available for
questioning. The questionnaire was designed and pretested to be a self-administered
instrument. A mail survey of 800 members of the two-state consumer panel was
conducted. The panel households were selected to be representative of urban and rural
households with annual incomes of $15,000 - $40,000. The panel was about average for
the two states in terms of education levels attained, type of occupation and income when
compared with available Bureau of Census averages.
40
Respondents were instructed to answer the questionnaire only if they had
purchased a new automobile in the last two years. Panel households are reimbursed with
shopping certificates for responding to research questionnaires. Three hundred and sixty
one replied within two weeks of the mail out with 354 of the questionnaires being
usable for the study.
As to how well the new car buyer understood their warranty coverage, mixed
results appeared. In structured questions with rating scales, most buyers strongly agreed
with the importance of understanding their warranty coverage. At the same time, a large
majority (about 73%) rated their understanding of the warranty as fairly to extremely
well. This result would suggest that most new car buyers understand what their
warranty coverage is.
As a check on their understanding, these new car owners were asked what type
of warranty they had and what items were covered under the warranty with open-ended
questions. About 43% of the respondents thought their warranty was a full warranty
when, in fact they were all limited warranties. In responding to what was covered, a
very large percentage of respondents answered don't remember or no response (about
50% if they said it was a full warranty and about 48% if it was a limited warranty).
Also, for the small number (15.5% of the new car buyers) who reported purchasing an
extended warranty, about 64% responded with don't remember or no response to what
was covered. The pattern of the responses to the open-ended questions reveals that
many new car buyers don't really know or understand what is covered under their
warranty and in fact have problems even knowing what type of warranty coverage they
have (limited warranty coverage, not full warranty coverage).
The investigator therefore doubts the validity of the results from the structured
questions/scaled answers format and feels the results of the open-ended questions may
more accurately depict the respondents' understanding of their warranty coverage.
Although the results of this descriptive study do not prove cause and effect
relationships, the most obvious implication is that warranty coverage is not an important
41
purchase criterion in the two state studies. In fact, as previously noted, it was a very
distant last in purchase importance. Also, most of the respondents appear to have little
understanding of their warranties (perhaps because it is not an important factor). As
much as this investigator would like to see required, full disclosure of automobile
warranties before purchase, the evidence would not support such a recommendation.
2.6.4 Consumer Perception Study
Thomas (2004), used to study the perception of consumers in USA, his study
examines consumers’ perceptions of the terms of an extended warranty, specifically the
length of the warranty contract using a mall-intercept method to identify 101 consumers
who have purchased an appliance or home electronics product in the past 2 years.
The results of his study shown that a majority of consumers interpret a claim of
‘‘4 years’’ in an extended warranty sales promotion piece as meaning just that, namely
that the warranty on the item ‘‘extends’’ for 4 years beyond the manufacturer’s
warranty, rather than meaning 4 years including the manufacturer’s warranty. This
finding was found across gender, age, education, and income variables. His research
results also shown that consumers who had purchased extended warranties on the
appliances and electronics products they bought in the past 2 years and those who were
highly likely to purchase an extended warranty with their next purchase interpret the
language in the promotional material as meaning that the extended warranty lasts 4
additional years beyond the manufacturer’s warranty.
It is also worth noting that respondents were shown the extended warranty
material is a quiet room after being stopped (intercepted) and qualified in shopping
malls. Respondents were told to take as much time as they needed to read the material
42
and the questionnaire was started only after the respondent had indicated they had had
enough time. Thus, if one quarter of respondents do not notice small print language
about the extended warranty including the manufacturer’s warranty and eight out of ten
(81.5%) of those who did see the information believe the extended warranty was 4 years
beyond the manufacturer’s warranty under the contrived conditions of this study, how
much higher is the percentage likely to be in a ‘‘real-world’’ retailing environment? In
an actual market-place environment, the consumer is presented the extended warranty
sales material as he/she is completing the purchase transaction. In the market-place
environment, it is doubtful that the consumer spends more than a few moments reading
the material and it is highly likely that a smaller percentage of respondents than found in
this study would notice a very small print disclosure that the warranty ‘‘includes the
manufacturer’s warranty’’ (actual print size) in the middle of a 60-line 8 point font
disclaimer on one of the middle panels in the inside of the brochure. Thus, the results
here are likely to substantially understate the level of misrepresentation actually existing
in the marketplace, the condition envisioned by the FTC when they defined deception as
‘‘likely to mislead a reasonable consumer acting reasonably under the circumstances’’.
The findings reported of the research are also likely to understate actual
miscomprehension since, as noted above, those who simply did not notice the reference
to the manufacturer’s warranty were not included in any analysis, on the presumption
that they simply had not read the material carefully. Clearly, if the reason they did not
notice any reference to the manufacturer’s warranty was because of the small print or
the placement of the limitation in the body of the promotional material, then the
findings reported here would be substantially higher.
43
2.6.5 Consumer and Manufacturer Perception Study
Craig a. Kelley and Conant (1991) they have been investigate about consumer
and manufacturer perceptions of why extended warranties are bought and sold are
evaluated and compared.
They come out by several implications for both marketing managers and public
policy makers in the research result. First, manufacturers that clearly communicate the
terms and conditions of their extended warranties may be in a position to create a
distinctive and sustainable competitive advantage by simplifying the wording and
encouraging consumers to read the extended warranty before its purchase. Consumers
who understand what is, as well as what is not, covered under the terms of an extended
warranty would be (1) less likely to become disappointed, and as a result, dissatisfied
with a manufacturer's service policies and procedures; (2) more likely to speak
favorably with friends and neighbors concerning a manufacturer's extended warranty;
(3) less likely to waste a manufacturer's time and money asking, and perhaps arguing,
that specific services be performed; and (4) more likely to purchase other products
produced by the manufacturer, as well as possibly other extended warranties.
Although the results of the study are exploratory, they have implications for
public policy-makers. It appears that public policy initiatives may be needed if
manufacturers do not voluntarily improve and simplify the wording used in extended
warranties. Currently, the Magnuson-Moss Warranty Act does not include explicit
disclosure rules and wording guidelines for extended warranties. However, given
increasing popularity of this new type of warranty coverage, coupled with the potential
overlap that sometimes exists between express and extended warranties, the Federal
Trade Commission may want to consider promulgating rules that address the nature,
scope, and wording of extended warranties.
44
2.6.6 Production and Extended Warranty
The effects of third party independent insurers on the markets for products and
product insurance have been studied by Lutza and Padmanabhan (1998). They have
been focused initially on whether a manufacturer with a monopoly in the product and
insurance markets can choose a menu of warranties and prices to profitably segment
consumers. The researchers then consider how the availability of extended warranties
affects the manufacturer’s menu choices. They find that the presence of an independent
insurer offering extended warranties can change the manufacturer’s warranty and
pricing policies, product quality, the manufacturer’s profits, and social welfare. In fact,
competition in the warranty market from an independent insurer can have the
unexpected effect of increasing the manufacturer’s profits.
And begin by considering a market made up of identical risk-averse consumers.
The manufacturer chooses a level of product quality that cannot be directly observed by
consumers. This is a situation of producer moral hazard; warranties then give the
manufacturer an incentive to produce a high quality product. Researchers assumed
initially that the manufacturer is a monopolist in both the product and the insurance
markets. The manufacturer maximizes profit by selling the product with a full warranty.
They then consider competition in the insurance market by adding an independent
insurance firm to the model. While remaining a monopolist in the product market, the
manufacturer now faces possible entry in the insurance market. However, as long as the
manufacturer offers a full warranty, the insurer will not enter the market with an
extended warranty. In this case, the presence of a potential competitor in the insurance
market has no effect on the manufacturer.
Next, they considered a market made up of consumers who vary in their
valuation of a working unit of the product; this leads to differences in both their
willingness to pay for the product and their willingness to pay for insurance in the form
of a warranty, the researchers again begin by assuming that the manufacturer is a
monopolist in the product and insurance markets. The manufacturer has two possible
45
optimal strategies: it may sell only to high valuation consumers, or it may screen the
two different groups of consumers by offering two products with different warranty
coverage and quality levels at different prices. High valuation consumers purchase a
high quality product with a full warranty and pay a high price. Low valuation
consumers choose to pay less and purchase a low quality product with only a partial
warranty.
Then they considered in the researches the impact of independent insurance on
the manufacturer’s ability to use warranties and quality to screen the consumer groups.
We might expect that the manufacturer will not find it profitable to use warranties as
screening devices once independent extended warranties are available. This would 5 be
the usual result in the commodity bundling literature. But because the bundled warranty
affects the quality of the product, our results differ. In the research model, the
manufacturer enjoys a cost advantage over an independent insurer in insuring the
product. The manufacturer is able to choose product quality to minimize insurance
costs, and therefore has lower marginal insurance costs. This cost advantage suggests
the manufacturer will prefer to bundle a warranty with its product even when extended
warranties are available. However, the presence of an outside insurer offering extended
warranties does change the manufacturer’s price, warranty and quality choices.
The results of study show that potential competition from an independent insurer
in the extended warranty market decreases the range of population distributions for
which the manufacturer will find it optimal to serve the entire product market, instead of
selling only to high valuation consumers. If the manufacturer responds to the potential
entrant by dropping low valuation consumers, entry is deterred. In this case, competition
increases the price paid by high valuation consumers: the warranty bundled with their
product remains the same. The manufacturer’s profits decrease, and total surplus also
decreases. If the manufacturer sells to both high and low valuation consumers, the
independent insurer enters the market in equilibrium, and sells extended warranties to
the under-insured low valuation consumers.
Generally the entry of a new competitor must decrease an incumbent firm’s
profits. But in research model, the markets for the product and for warranty insurance
46
are intimately linked. Because entry into the insurance market affects consumer
behavior in the product market, manufacturer profits may actually increase. In order to
segment the market, the manufacturer must offer two product models that will induce
each group of consumers to participate in the market and select the product designed for
their group. The availability of extended warranties makes the products more attractive
to consumers. This relaxes the participation constraint.
At the same time, extended warranties make the product intended for low
valuation consumers more attractive to high valuation consumers. This tightens the self
selection constraints. The effect of competition on profits will depend on these two
opposing effects.
The researchers find that competition may increase or decrease both the price
and the manufacturer’s warranty (and the product quality) of the product intended for
low valuation consumers. These consumers purchase an extended warranty; the
extended warranty together with the manufacturer’s warranty leaves this group fully
insured. Competition will not change the warranty and quality of the product sold to
high valuation consumers. The price to this group may increase or decrease. As a result
of these changes in prices and warranties, the manufacturer’s profits may actually
increase after entry into the insurance market; this can be the case when entry increases
the price charged to one or both groups of consumers.
Entry may increase or decrease social welfare, as measured by total surplus. In
the research model, product warranties serve three purposes. They insure consumers,
they affect product quality, and they are a tool for price discrimination. These three
purposes have been analyzed in other work on manufacturer warranties.
47
2.7
Chapter Summary
Extended warranty been studied for long time by researchers, and warranty and
extended warranty research conducted to date, provides insights to scholars interested in
further studying extended warranties.
From introduction about Malaysian automobile industry until the prior
researches of warranty and extended warranty have been covered and mentioned
extensively in this chapter literature review.
CHAPTER 3
METHODOLOGY
3.1
Introduction
As mentioned in chapter one in the problem statement, the extended warranty
has been known and accepted for long time in the developing countries, but in Malaysia
it’s recently has introduced, and the majority of consumers doesn’t know what is the
extended warranty, therefore the major objective of this research it’s t investigate the
perception and attitude of consumers toward the extended warranty, thereby. We
surveyed by built questionnaire instrumental to guide the investigation in this research.
Today the word "survey" is used most often to describe a method of gathering
information from a sample of individuals. This "sample" is usually just a fraction of the
population being studied.
49
For example, a sample of voters is questioned in advance of an election to
determine how the public perceives the candidates and the issues, a manufacturer does a
survey of the potential market before introducing a new product, a government entity
commissions a survey to gather the factual information it needs to evaluate existing
legislation or to draft proposed new legislation.
Not only do surveys have a wide variety of purposes, they also can be
conducted in many ways-including over the telephone, by mail, or in person.
Nonetheless, all surveys do have certain characteristics in common.
3.2
Justification of Method
•
Questionnaires are very cost effective when compared to face-to-face
interviews. This is especially true for studies involving large sample sizes and
large geographic areas. Written questionnaires become even more cost effective
as the number of research questions increases.
•
Questionnaires are easy to analyze. Data entry and tabulation for nearly all
surveys can be easily done with many computer software packages.
•
Questionnaires are familiar to most people. Nearly everyone has had some
experience completing questionnaires and they generally do not make people
apprehensive.
•
Questionnaires reduce bias. There is uniform question presentation and no
middle-man bias. The researcher's own opinions will not influence the
respondent to answer questions in a certain manner. There are no verbal or
visual clues to influence the respondent.
50
•
Questionnaires are less intrusive than telephone or face-to-face surveys. When a
respondent receives a questionnaire in the mail, he is free to complete the
questionnaire on his own time-table. Unlike other research methods, the
respondent is not interrupted by the research instrument.
3.3
Project Research Flow Chart
Questionnaire research design proceeds in an orderly and specific manner. Each
item in the flow chart depends upon the successful completion of all the previous items.
Therefore, it is important not to skip a single step. Notice that there are two feedback
loops in the flow chart to allow revisions to the methodology and instruments.
There are at least nine distinct steps: decide on the information required; define
the target respondents, select the method(s) of reaching the respondents; determine
question content; word the questions; sequence the questions; check questionnaire
length; pre-test the questionnaire and develop the final questionnaire
51
Figure3.1 Project Flow Chart
52
3.3.1 Design Methodology
It is consider as the first stage in the method of gathering information
requirements, which Is represent the process of collecting background data for planning
survey design, what the data what you need and, whom you should collect and how you
are going to collect it.
It may seem strange to be suggesting that the method of reaching the intended
respondents should constitute part of the questionnaire design process. However, a
moment's reflection is sufficient to conclude that the method of contact will influence
not only the questions the researcher is able to ask but the phrasing of those questions.
The main methods available in survey research are:
•
Personal interviews.
•
group or focus interviews
•
mailed questionnaires
•
telephone interviews
One may already have an idea about the kind of information to be collected, but
additional help can be obtained from secondary data, previous rapid rural appraisals and
exploratory research. In respect of secondary data, the researcher should be aware of
what work has been done on the same or similar problems in the past, what factors have
not yet been examined, and how the present survey questionnaire can build on what has
already been discovered. Further, a small number of preliminary informal interviews
with target respondents will give a glimpse of reality that may help clarify ideas about
what information is required.
53
3.3.2 Determination of Feasibility
Researchers must always be prepared to ask, "Is this question really needed?"
The temptation to include questions without critically evaluating their contribution
towards the achievement of the research objectives, as they are specified in the research
proposal, is surprisingly strong. No question should be included unless the data it gives
rise to is directly of use in testing one or more of the hypotheses established during the
research design.
Some question types include:
•
Fixed-alternative questions provide multiple-choice answers. These types of
questions are good when the possible replies are few and clear-cut, such as age,
car ownership, etc.
•
Open-ended questions allow the respondent to better express his/her answer,
but are more difficult to administer and analyze. Often, open-ended questions
are administered in a depth interview. This technique is most appropriate for
exploratory research.
•
Projective methods use a vague question or stimulus and attempt to project a
person's attitudes from the response. The questionnaire could use techniques
such as word associations and fill-in-the-blank sentences. Projective methods are
difficult to analyze and are better suited for exploratory research than for
descriptive or causal research.
•
Likert scale technique presents a set of attitude statements. Subjects are asked
to express agreement or disagreement of a five-point scale. Each degree of
agreement is given a numerical value from one to five. Thus a total numerical
value can be calculated from all the responses
54
3.3.3 Development of Instruments
The design of a questionnaire will depend on whether the researcher wishes to
collect exploratory information (i.e. qualitative information for the purposes of better
understanding or the generation of hypotheses on a subject) or quantitative information
(to test specific hypotheses that have previously been generated). There are good and
bad questions. The qualities of a good question are as follows:
1. Evokes the truth. Questions must be non-threatening. When a
respondent is concerned about the consequences of answering a
question in a particular manner, there is a good possibility that the
answer will not be truthful. Anonymous questionnaires that contain no
identifying information are more likely to produce honest responses
than those identifying the respondent. If your questionnaire does
contain sensitive items, be sure to clearly state your policy on
confidentiality.
2. Asks for an answer on only one dimension. The purpose of a survey is
to find out information. A question that asks for a response on more
than one dimension will not provide the information you are seeking.
For example, a researcher investigating a new food snack asks "Do
you like the texture and flavor of the snack?" If a respondent answers
"no", then the researcher will not know if the respondent dislikes the
texture or the flavor, or both. Another questionnaire asks, "Were you
satisfied with the quality of our food and service?" Again, if the
respondent answers "no", there is no way to know whether the quality
of the food, service, or both were unsatisfactory. A good question asks
for only one "bit" of information
55
3. Can accommodate all possible answers. Multiple choice items are the
most popular type of survey questions because they are generally the
easiest for a respondent to answer and the easiest to analyze. Asking a
question that does not accommodate all possible responses can
confuse and frustrate the respondent
Each question should have a specific purpose or should not be included in the
questionnaire. The goal of the questions is to obtain the required information. This is
not to say that all questions directly must ask for the desired data. In some cases
questions can be used to establish rapport with the respondent, especially when
sensitive information is being sought.
Sensitive questions can be posed in ways to increase response likelihood and to
facilitate more honest responses. Some techniques are:
•
Place the question in a series of less personal questions.
•
State that the behavior or attitude is not so unusual.
•
Phrase the question in terms of other people, not the respondent.
•
Provide response choices that specify ranges, not exact numbers.
•
Use a randomized response model giving the respondent pairs of questions with
a randomly assigned one to answer. The interviewer does not know which
question the person is answering, but the overall percentage of people assigned
to the sensitive question is known and statistics can be calculated.
The design of questionnaire have comprised of four major parts. Part one has
been contains the respondent’s information such as gender, age and ethnic. Part two
have ask questions related to understanding of consumers to the term of extended
warranty, as will as part three have contains questions belong for those whom have deal
with the term before and are familiar with it, and finally part four have indicated to the
satisfaction and the feeling of consumers toward the extended warranty, whether if
consumers recommend to use the extended warranty for many perspectives or not.
56
3.3.4 Conducting Pilot Test
The questionnaire should be pre-tested in two stages before distributing. In the
first stage, it should be administered using personal interviews in order to get better
feedback on problems such as ambiguous questions. Then, it should be tested in the
same way it will be administered. The data from the test should be analyzed the same
way the administered data is to be analyzed in order to uncover any unanticipated
shortcomings. The purpose of pretesting the questionnaire is to determine:
•
Whether the questions as they are worded will achieve the desired results
•
Whether the questions have been placed in the best order
•
Whether the questions are understood by all classes of respondent
•
Whether additional or specifying questions are needed or whether some
questions should be eliminated
•
Whether the instructions to interviewers are adequate.
Usually a small number of respondents are selected for the pre-test. The
respondents selected for the pilot survey should be broadly representative of the type of
respondent to be interviewed in the main survey.
If the questionnaire has been subjected to a thorough pilot test, the final form of
the questions and questionnaire will have evolved into its final form. All that remains to
be done is the mechanical process of lying out and setting up the questionnaire in its
final form. This will involve grouping and sequencing questions into an appropriate
order, numbering questions, and inserting interviewer instructions
57
3.3.5 Revise Instruments
After the test pilot has come out by the result, the elimination and modification
can dominate this stage by revise shortcomings and ambiguous questions, re-wording
questionnaire form can done by the flowing steps:
•
Figure out the test pilot result.
•
Determinate the shortcomings.
•
Eliminate and modify the shortcomings.
•
Re-wording the firm of questionnaire.
•
Produce the final instrumental of revise questionnaire.
This is represent the most important stage in the research, from here researcher
can go further forward with uncertain information witch is can effect in the final result,
and all the previous work can gone in this stage, therefore. The data that collected by
questionnaire should come out by accurate result and touch the research needs.
3.3.6 Conducting the Research
At this stage of the research we will be ready to go into the field and collect
data. The various issues relating to data collection constitute the main body of the text
and therefore.
58
3.3.7 Data Analysis
The word 'analysis' has two component parts, the prefix 'ana' meaning 'above'
and the Greek root 'lysis' meaning 'to break up or dissolve'. Thus data analysis can be
described as:
"...a process of resolving data into its constituent components, to reveal its characteristic
elements and structure."
The primary purpose of conducting a survey, of course, is to produce data that
will help answer important research questions. Once collected, the data must be
collated, organized, summarized, and described. Most beginning survey researchers
understand this, and faithfully go about calculating summary measures such as means,
frequencies, standard deviations, and correlations and creating tables and graphs that
illustrate important findings. Such activities are appropriate, necessary, and important.
However, they are not sufficient to allow conclusions to be drawn from survey data.
Unless the entire population of interest was surveyed and the response rate was
100%, the data provided by surveys are estimates of population variables. This means
they are almost surely wrong. The estimates may be off by just a small fraction of a
percentage point or they may be off by 10 percentage points or more, but they are off by
some unknown amount. The amount of error cannot in fact be determined with
certainty. However, it is possible, through applying a type of statistics called "inferential
statistics," to determine the likelihood of different sizes of errors and therefore how
much confidence one can have in the sample estimates. This determination of the
degree of confidence in the results depends on the sample size and the pattern of
variation in the data, and thus cannot be done simply by examining summary measures,
tables, or graphs: it requires additional statistical calculations, and it is irresponsible to
report sample estimates without completing this additional step.
Where the data is quantitative there are three determinants of the appropriate
statistical tools for the purposes of analysis. These are the number of samples to be
59
compared, whether the samples being compared are independent of one another and the
level of data measurement.
Suppose a fruit juice processor wishes to test the acceptability of a new drink
based on a novel combination of tropical fruit juices. There are several alternative
research designs which might be employed, each involving different numbers of
samples.
Test A
Table 3.1 Comparing sample
Comparing sales in a test market and the market Number of samples =
share of the product it is targeted to replace.
Test B
1
Comparing the responses of a sample of regular Number of samples =
drinkers of fruit juices to those of a sample of non- 2
fruit juice drinkers to a trial formulation.
Test C
Comparing the responses of samples of heavy, Number of samples =
moderate and infrequent fruit juice drinkers to a trial 3
formulation.
The next consideration is whether the samples being compared are dependent
(i.e. related) or independent of one another (i.e. unrelated). Samples are said to be
dependent, or related, when the measurement taken from one sample in no way affects
the measurement taken from another sample. Take for example the outline of test B
above Table3.1. The measurement of the responses of fruit juice drinkers to the trial
formulation in no way affects or influences the responses of the sample of non-fruit
juice drinkers. Therefore, the samples are independent of one another. Suppose however
a sample were given two formulations of fruit juice to taste. That is, the same
individuals are asked first to taste formulation X and then to taste formulation Y. The
researcher would have two sets of sample results, i.e. responses to product X and
responses to product Y. In this case, the samples would be considered dependent or
related to one another. This is because the individual will make a comparison of the two
60
products and his/her response to one formulation is likely to affect his/her reaction or
evaluation of the other product.
Table 3.2 Levels of measurement
Measurement
scale
Measurement Level
Examples
Mathematical properties
Nominal
Frequency counts
Producing grading categories Confined to a small number of
tests using the mode and
frequency
Ordinal
Ranking of items
Placing brands of cooking oil Wide range of nonparametric
in order of preference
tests which test for order
Interval
Relative differences of
magnitude between
items
Scoring products on a 10
point scale of like/dislike
Wide range of parametric tests
Ratio
Absolute differences of
magnitude
Stating how much better one
product is than another in
absolute terms.
All arithmetic operations
The third factor to be considered is the levels of measurement of the data being
used. Data can be nominal, ordinal, interval or ratio scaled. Table 3.2 summarizes the
mathematical properties of each of these levels of measurement.
Once the marketing researcher knows how many samples are to be compared,
whether these samples are related or unrelated to one another and the level of
measurement then the selection of the appropriate statistical test is easily made. To
illustrate the importance of understanding these connections consider the following
simple, but common, question in marketing research. In many instances the age of
respondents will be of interest.
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3.3.7.1
Cross Tabulation
A cross tabulation (often abbreviated as cross tab) displays the joint distribution
of two or more variables. They are usually presented as a contingency table in a matrix
format. Whereas a frequency distribution provides the distribution of one variable, a
contingency table describes the distribution of two or more variables simultaneously.
Each cell shows the number of respondents who gave a specific combination of
responses, that is, each cell contains single cross tabulation.
There are a wide variety of statistics available in the CROSSTABS procedure.
Some of the CROSSTABS statistics are appropriate for nominal (categorical) scales,
some for ordinal scales, and some for interval scales. In order to use the output from
CROSSTABS wisely, you should be able to recognize what type of data is appropriate
for each statistic and you should be able to recognize the level of measurement for the
scales that you are analyzing. You should review the Scales of Measurement notes.
This set of notes organizes the CROSSTABS statistics into those that are
appropriate for nominal level measures (Pearson Chi-Square, Likelihood Ratio, Phi,
Cramer's V, Contingency Coefficient, Lambda, Goodman & Kruskal Tau, Uncertainty
Coefficient, and Kappa), those that are appropriate for ordinal level measures (MantelHaenszel, Gamma, Tau c, Tau b, Somers' D, and Spearman Correlation), and those that
are appropriate for interval level measures (Pearson's r and Eta).
62
3.3.7.2
Chi-Square
The chi-square (chi, the Greek letter pronounced "kye”) statistic is a
nonparametric statistical technique used to determine if a distribution of observed
frequencies differs from the theoretical expected frequencies. Chi-square statistics use
nominal (categorical) or ordinal level data, thus instead of using means and variances,
this test uses frequencies. The value of the chi-square statistic is given by
where X2 is the chi-square statistic, O is the observed frequency and E is the expected
frequency
Generally the chi-squared statistic summarizes the discrepancies between the
expected number of times each outcome occurs (assuming that the model is true) and
the observed number of times each outcome occurs, by summing the squares of the
discrepancies, normalized by the expected numbers, over all the categories (Dorak,
2006).
Data used in a chi-square analysis has to satisfy the following conditions
1. Randomly drawn from the population,
2. Reported in raw counts of frequency,
3. Measured variables must be independent,
4. Observed frequencies cannot be too small, and
5. Values of independent and dependent variables must be mutually exclusive.
There are two types of chi-square test.
•
The Chi-square test for goodness of fit which compares the expected and
observed values to determine how well an experimenter's predictions fit the
data.
63
•
The Chi-square test for independence which compares two sets of categories
to determine whether the two groups are distributed differently among the
categories. (McGibbon, 2006).
3.3.7.3
Correlation
Correlation is a measure of association between two variables. The variables are
not designated as dependent or independent. The two most popular correlation
coefficients are: Spearman's correlation coefficient rho and Pearson's product-moment
correlation coefficient.
When calculating a correlation coefficient for ordinal data, select Spearman's
technique. For interval or ratio-type data, use Pearson's technique.
The value of a correlation coefficient can vary from minus one to plus one. A
minus one indicates a perfect negative correlation, while a plus one indicates a perfect
positive correlation. A correlation of zero means there is no relationship between the
two variables. When there is a negative correlation between two variables, as the value
of one variable increases, the value of the other variable decreases, and vise versa. In
other words, for a negative correlation, the variables work opposite each other. When
there is a positive correlation between two variables, as the value of one variable
increases, the value of the other variable also increases. The variables move together.
The standard error of a correlation coefficient is used to determine the
confidence intervals around a true correlation of zero. If your correlation coefficient
falls outside of this range, then it is significantly different than zero. The standard error
64
can be calculated for interval or ratio-type data (i.e., only for Pearson's product-moment
correlation).
The significance (probability) of the correlation coefficient is determined from
the t-statistic. The probability of the t-statistic indicates whether the observed
correlation coefficient occurred by chance if the true correlation is zero. In other words,
it asks if the correlation is significantly different than zero. When the t-statistic is
calculated for Spearman's rank-difference correlation coefficient, there must be at least
30 cases before the t-distribution can be used to determine the probability. If there are
fewer than 30 cases, you must refer to a special table to find the probability of the
correlation coefficient.
3.3.7. Hypothesis
The first step in the process is to set up the decision making process. This
involves identifying the null and alternative hypotheses and deciding on an appropriate
significance level. Associated with these decisions are issues to do with Type I and
Type II errors, one or two-tailed tests, and power. A very important issue to be aware of
here is the problem of multiple tests of significance.
There are generally two forms of a statistical hypothesis: null (typically
represented as H0) and an alternative (typically symbolized as H1 - this is the research
hypothesis - the one we are really interested in showing support for!). Since our interest
is in making an inference from sample information to population parameter(s),
hypotheses are usually formally stated in terms of the population parameters about
which the inference is to be made. We use two forms of hypotheses to set the stage for a
65
logical decision. If we amass enough evidence to reject one hypothesis, the only other
state of affairs which can exist is covered by the remaining hypothesis. Thus, the two
hypotheses (null and alternative) are set up to be mutually exclusive and exhaustive of
the possibilities.
3.3.7.5 SPSS
SPSS (originally, Statistical Package for the Social Sciences) was released in its
first version in 1968 after being founded by Norman Nie. SPSS is among the most
widely used programs for statistical analysis in social science. It is used by market
researchers, health researchers, survey companies, government, education researchers,
marketing organizations and others. In addition to statistical analysis, data management
(case selection, file reshaping, creating derived data) and data documentation (a
metadata dictionary is stored with the data) are features of the base software.
3.4
Project Methodology
The operational framework as shown in Figure 3.2 illustrates the main activities
carried out in effort made to achieve our research objectives. This enabled us to
sectionalize our work and also develop our project schedule.
66
Figure 3.2 Operational Frameworks of Research Activities
67
3.5
Chapter Summary
A well designed questionnaire is essential to a successful survey. However, we
must develop our own intuition with respect to what constitutes 'good design' since
there is no theory of questionnaires to guide us.
A good questionnaire is one which helps directly achieve our research
objectives, provides complete and accurate information; is easy for both interviewers
and respondents to complete, is so designed as to make sound analysis and
interpretation possible and is brief.
CHAPTER 4
DATA ANALYSIS
4.1
Introduction
Based on the methodology of this study, precisely on stage seven tagged as
“Revise Instrumental”, this chapter starts with analysis of data collected from the
questionnaire instrument that was designed, using SPSS software as technical tools as
an application to key in our data collection, and particular techniques such as
Correlation and Descriptive Analysis (Percentage) to interpret the data gathered.
People in metropolitan area represented in Johor State within the cites of
Skudai, Tmn Universiti and Johor Bahru which are some of the main cities in Malaysia
were our target to gain insight in the research. The selection was done randomly for the
respondents and the study concentrated on the people who have vehicle such as Cars
and Motorbikes from different age brackets and ethnicity (Malay, Chinese and Indian)
to evaluate consumers’ perception and results were obtained according to the research
objectives.
69
4.2
Instrumental Design
A cover letter of the questionnaire explained that the purpose of the study was to
explore and measure consumer perceptions of extended warranties. A short definition
and explanation of difference between warranty and extended warranty were also
included in the cover letter.
And below the cover letter was an appreciation to
respondents for their participation. Then, the second page before the instrumental
questions, contained information related to particular formations of the respondents
such as Gender, Age, Ethnic, and ownership of vehicle? And what type of vehicle they
own, occupation and income (see appendix E).
The questionnaire instrumental comprised of three major parts, each part was
designed to answer a particular question in the research questions. In part one, we have
explored the knowledge of consumers toward the extended warranty and tried to figure
out whether the Malaysian consumers have idea about this new policy or not. In part
two, we designed to measure the percentage of consumers in particular who own
vehicle and whether they purchase extended warranty with their vehicle before or not.
Also in part three, we tried to explore the consumers’ perception, believe and trust
toward the extended warranty policy in terms of automobile marketing (see appendix
E).
70
4.3
Profile of Respondents
One hundred and fifty (150) samples of the questionnaire were distributed in a
wide range of demographics (Johor Bahru). We have taken in our self to obtain as
much respondents as we can and tried to encourage our respondents to answer our
questionnaire. The response was 150, which means we obtained full rate of response
(100%).
Equilibrium occurred in terms of the gender of respondents, 75 (50%) for male
and the same results for female (see Figure 4.1).
Percentage of Gender
female
50.0%
male
50.0%
Figure 4.1 Percentage of Gender
In terms of respondents age, we classified the age in three classes as shown in
Figure 4.2. Class One was classified between 18-25 years and the respond of this class
was 55 (36.7%), for the second class was classified between 25-35 years, and we
obtained from this class 44 responds (44%), and we received 19 response (19.3%) from
the 35 and above class.
71
Percentage of Age Groups
35-above
19.3%
18-25
36.7%
25-35
44.0%
Figure 4.2 The Percentage of Age Groups
Because in Malaysia there is three main ethnic groups represented such as
Malay, Chinese and Indian, we classified that in the questionnaire and the highest rate
of respondents were 88 (58.7%) scored by Malay ethnic, 24 (28%) was scored by
Chinese and 20 (13.3%) by Indian respondents as shown in Figure 4.3.
Percentage of All Ethnic Groups
india
13.3%
chinese
28.0%
Malay
58.7%
Figure 4.3: The Percentage of Ethnics Group
Because this research targeted consumers who have vehicles, we asked our
respondents if they have vehicles or not, and what type of vehicles do they have.
72
Whether it is a Car, Motorbike or other type of vehicle, and a majority 100 (73.3%)
indicated they have Cars, 39(26%) have Motorbike and only one (.7%) indicate they
have other type of vehicles. And from Figure 4.4, we can see also the majority of
respondents in terms of occupation were students, about 53 (35.3%), while 40 (26.7%)
indicated as government employees, 26 (19.3%) indicated as conducting private
businesses, while a minute proportion, 3 (2%) of respondents indicated private
company, 24 (16%) noted they are employees and only one (.7%) of the respondent has
indicated others.
Percentage of Occupation groups
others
private busines
.7%
19.3%
student
35.3%
private company
2.0%
employee
16.0%
government staff
26.7%
Figure 4.4 The Percentage of Respondents Occupation
In terms of monthly income approximately, 50 (33.3%) of respondents noted
that their monthly income is under RM1000, while 74(49.3%) of them have a monthly
income between RM1000-3000. 24(16%) of respondents claim that their monthly
income is between RM3000-5000 and in the end only 2 (1.3%) indicated their monthly
income to be above RM5000.
4.3.1 Respondents Variables
73
We briefly mentioned the contents of the respondents’ information in the first
section of the questionnaire above, and also briefly described the variables of the
respondents section as shown below.
GENDER: are you? 1= male and 2= female.
AGE: your age between: 1= 18-25, 2= 25-35 and 3= 35- above.
ETHNIC: Your ethnic is: 1=Malay, 2= Chinese and 3= Indian.
VEHICLE: Do you have vehicle? 1= Yes and 2= No.
VCLETYPE: What type of vehicle do you have? 1= Car, 2= Motorbike and 3= Other.
OCCPTION: Occupation: 1= Private Business, 2= Private Company, 3= Employee,
3= Government Staff, 5= Student and 6= Other
4.4
The Design and Variables of Part One
In part one, we investigated and inquired into the knowledge of consumers
toward the extended warranty and tried to figure out whether the Malaysian consumers
have idea about extended warranty or not.
IDEAWRNT: Do you have idea about what is the warranty? 1= Yes and 2= No.
BGHPROD: Have you bought product with warranty before? 1= Yes and 2= No.
EXTNDWRN: Do you have idea about what is the extended warranty? 1= Yes and 2=
No.
BGHEXTPR: Have you bought product with extended warranty before? 1= Yes and 2=
No.
WHEREXWR: how do you know about extended warranty? 1= Friend/relative,
2= salesperson, 3= Ads/Promotion, 4= via the internet and 5= other.
74
DEFEXTWR: Base on your idea, which of these definitions describe for you the right
definition of extended warranty? 1= An Extended Warranty is prolonged warranty
offered by manufacturer or retailer to consumers; this warranty extends the period of the
manufacturer’s standard warranty and is optional, 2= An Extended Warranty is
prolonged warranty requested by consumers from manufacturers or retailers; this
warranty extends over the period of the manufacturer’s standard warranty and 3= I
don’t Know.
4.5
The Design and Variables of Part Two
In part two, we designed to measure the percentage of consumers in particular
who have vehicles and whether if they deal and purchase extended warranty with their
vehicle before or not, and if the consumers are familiar with this new policy. In this
section, the rest of the questions are relate to the first question and if the respondent
indicates a ‘NO’ answer which implies the rest of the questions are not going to be
useful in our analysis.
BGHWTHEX: Have you bought vehicle with extended warranty before? 1= Yes and
2= No. and if the answer is 1=Yes the respondents will be able to answer the rest of
questions.
HWMNYYRS: How many years should your extended warranty cover? 1= Extra one
year, 2= Extra two years, 3= Extra three years, 4= Extra four years and 5= More than
extra five years.
HWLNGEXT: How long you bought your extended warranty with your vehicle? 1=
Recently I bough, 2= Less than one year, 3= Less than one year, 4= Less than three
years and 5= More than three years.
75
USDSRVWR: And have you used your extended warranty services since you got the
extended warranty? 1= Yes and 2= NO and the next question relay on 1= Yes answer of
this question.
IFUSDYES: if yes how many times you used please? 1= One time, 2= Two times, 3=
Three times, 4= Four times and 5= More than five times.
DIDBUYEX: When you bought the vehicle, did you buy an extended warranty at the
same time? 1= Yes and 2= No.
CSTEXWRR: When you bought extended warranty. For sure you add some extra value
amounts for your warranty, in your opinion, what is your impression about the cost
value that you paid to add extended warranty service? 1= Very cheap price, 2= Cheap
price, 3= Barely accept the price, 4= Expensive price and 5= Very expensive price.
PROPEXWR: What propose you bought extended warranty? 1=Reducing purchasing
risk, 2=Reducing repairing cost, 3= Follow friend and 4= Self insurance.
4.6
The Design and Variables of Part Three
In part three, we tried to explore the consumers’ acceptance of this new policy,
and the recommendations and trust of consumers toward the extended warranty policy
in terms of automobile marketing.
EXPEREXT: Your experience about extended warranty is: 1= Very strong experience,
2= Very good, 3= Good, 4= Not bad and 5= Very bad.
APPEXTWR: Do you prefer to apply for extended warranty when you buying vehicle?
1= Defiantly would, 2= probably would, 3= might or not might, 4= probably would not
and 5= definitely would not.
76
REMNDPAY: Your recommendation of paying a vehicle with extended warranty is: 1=
Very strong recommend, 2= Strong recommend, 3= Recommend, 4= Not recommend
and 5= Very not recommend.
ENTRSTBU: If you interest to buy an extended warranty with your vehicle, how many
extended warranty period you like to buy? 1=1 year, 2=2 years, 3=3 years, 4= 4 years
and 5= more than 4 years.
THNKBYEX: Do think buying extended warranty can give you peace of mind? 1=
Extremely yes, 2= Yes, 3= Not sure, 4= No and 5= Defiantly No.
4.7
Pilot Test
For the pilot study, we have taken the interview to guide us in the phases of
conducting the pilot test, in order to get better feedback on problems such as ambiguous
questions. Then, the data from the test has been analyzed in the same way the
administered data is to be analyzed in order to uncover any unanticipated shortcomings.
After we conducted the pilot test and made sure the questionnaire does not
contain any shortcoming, we started the distribution of the questionnaire and the result
of the questionnaire are represented in the same Tables as the results based on 150
sample numbers who had completed the information on all variables used in the models
are presented in Table 4.1. Table 4.2, summarizes the combination of the new variables
in order to conduct a comparison of the variables that we have compared.
The descriptive statistic of mean, standard deviation, minimum and maximum
are represented in Table 4.3
77
Table4.1: Definition of the Variables
Variable
Definition
GENDER
You are? Male or Female
AGE
Your age between? 18-25, 25-35 or 35-above
ETHNIC
Your ethnic group? Malay, Chinese or Indian
VEHICLE
Do you have vehicle?
VCLETYPE
What type of vehicle do you have?
OCCPTION
Occupation
INCOME
Income
IDEAWRNT
Do you have idea about what is warranty?
BGHPROD
Have you bought product with warranty before?
EXTNDWRN
Do you have idea about what is the extended warranty?
BGHEXTPR
Have you bought product with extended warranty before?
WHEREXWR Where did you know about extended warranty?
DEFEXTWR
Base on your idea, which of these definitions describe for you the right
definition of extended warranty?
78
Table4.1 Definition of the Variables (continue)
Variable
BGHWTHEX
Definition
Have you bought vehicle with extended warranty before?
HWMNYYRS How many years your extended warranty you bought should cover?
HWLNGEXT
How long you bought your extended warranty with your vehicle?
And have you used your extended warranty services since you got the
USDSRVW
IFUSDYES
DIDBUYEX
CSTEXWRR
extended warranty?
If yes how many times you used please?
When you bought the vehicle, did you buy an extended warranty at the
same time?
When you bought extended warranty. For sure you add some extra
value amounts for your warranty, in your opinion, what is your
impression about the cost value that you paid to add extended warranty
service?
PROPEXWR
What propose you bought extended warranty?
EXPEREXT
Your experience about extended warranty is:
APPEXTWR
Do you prefer to apply for extended warranty when you buying
vehicle?
REMNDPAY
Your recommendation of paying a vehicle with extended warranty is:
ENTRSTBU
If you interest to buy an extended warranty with your vehicle, how
many extended warranty period you like to buy?
THNKBYEX
Do think buying extended warranty can give you peace of mind?
79
Table 4.2 Definition of New Variables
Variables
Definition
ID_DIFIN
Ethnic group have idea bout extended warranty and they have
the right definition.
WL_IDEA
Ethnic group have idea about extended and did not bought
before
DIF_IDEA
Ethnic group have an idea and they know the right definition
EXT_PEAC
Ethnic groups that bought extended with vehicle
IDEA_ALL
Ethnic group have idea about extended warranty and either
they bought or not
ETNC_IDE
Ethnic group they know the right definition of extended
warranty
IDEA_ALL
Ethnic group have idea about extended warranty and either
they bought it before or not
ETH_IDEA
Ethnic group have idea about extended warranty
ETHN_PEX
Ethnic those bough extended warranty with them vehicle
IN_IDEA
Income group have idea about extended warranty
IN_WL
Income group have idea about extended warranty but did not
bought it before
INC_IDEA
Income group have idea about extended warranty
80
Table 4.2 Definition of New Variables (continue)
Variables
Definition
IN_BUGHT
Income group have bought extended warranty with vehicles
INCO_IVV
Income group know the right definition
AGE_IDE
Age group have idea about extended warranty
AG_WL
Age group have idea about extended warranty but they did not
buy it before
AG_BUGHT
Age group have bought extended warranty with vehicle before
GEND_IDE
Gender group have idea about extended warranty
GEN_IDEA
Gender group have idea about extended warranty and whether
they bought it or not
GEN_WL
Gender group have idea about extended warranty but did not
bought it before
GN_BUGHT
Gender group have bought extended warranty with them
vehicle
81
Table 4.3 Destructive Statistic of Variables
Maximu
N
Mean
Std. Deviation
150
1
2
1.50
.502
150
1
3
1.83
.730
150
1
3
1.55
.720
150
1
1
1.00
.000
150
1
3
1.27
.462
150
1
5
3.58
1.476
150
1
4
1.85
.727
150
1
2
1.01
.115
150
1
2
1.03
.162
150
1
2
1.26
.440
Extended
150
1
2
1.65
.478
extended
134
1
5
2.71
1.348
gender
Age
Ethnic
Vehicle
Vehicle Type
Occupation
Income
Idea Warranty
Bought Product
Extended Warranty
Bought
Minimum m
Warranty
where
warranty
82
Table 4.3 Destructive Statistic of Variables (continue)
Maximu
N
Definition warranty
Bought with Extended
Warranty
How Many Years
How
long
your
Extended warranty
Used Extended Wrranty
service
If Used Service
Did
you
buy
Minimum
m
Std.
Mean
Deviation
50
1
3
1.71
.840
150
1
3
1.90
.323
15
1
5
2.53
1.407
15
1
5
2.53
1.506
16
1
2
1.31
.479
12
1
5
2.08
1.165
16
1
2
1.56
.512
150
1
4
2.81
.584
150
1
5
3.47
1.197
150
1
5
2.41
.667
an
Extended Warranty at
same time
your recommendation of
paying a vehicle with
extend warranty
If you interest to buy an
extended warranty with
your vehicle, how many
extended
warranty
period you like to buy
Do you think buying
extended warranty can
give you peace of mind?
83
4.8
Questionnaire analysis
The frequency of major variables can be summarized and attached in appendix
F, It can be seen that 98.7% have idea about warranty and only 1.3% indicate they do
not have idea about warranty. Also, about 97.3% have bought products with warranty
and 2.7% they haven’t bought.
Figure 4.5 shown that about 74% have idea about the extended warranty and
34.7% indicates they haven’t bought product with extended warranty services before.
The respondents who have idea about extended warranty 16.7% know about extended
warranty
through
friend/relative,
31.3%
through
salespersons, 18.7%
from
ads/promotion, 6.7% via internet and 16.7% indicate ‘others’ and 10.7% contained
missing data.
80
74
60
40
26
Percent
20
0
yes
no
Figure 4.5. The Percentage of the Idea about Extended Warranty
According to definition question, 54% of respondents indicate first definition
and 21.3% indicate to the second definition and about 24.7% do not know.
Only 10.% of the respondents as shown in Figure 4.6 have bought vehicle with
extended warranty services, and about 90% haven’t bought vehicle with extended
84
warranty services before, and about 2% apply for one year from the service, 4.7%
applied for extra two years, 1.3% applied for extra three years while about 2% has
applied for more than five years, 2.7% recently bought the service with the vehicle, 4%
bought the extended warranty service with in less than one year, 0.7% bought the
service in less than two years as well as less than three years and 2% indicate for more
than three years.
100
90
80
60
40
Percent
20
10
0
yes
no
Figure 4.6. The Percentage of Bought Extended Warranty with Vehicle
In terms of using the extended warranty service, about 7.3% claim they have
been using the service and only 2.7% claim they haven’t used the service, and of those
whom have used the service, about 2.7% used the service one time as well as two times,
1.3% have used the service for three times and only 0.7% used it for more than five
times.
4.7% indicated for buying the extended warranty service in the same time and
5.3% haven’t applied for the service at the same time, and in terms of price of the
service about 2.0% indicated that the price is very cheap and also indicated cheap price
while the price was barely acceptable from 3.3% of the participants, also 2.0% claim the
price is expensive and only .75% said the price is very expensive.
85
3.3% of the respondents from whom bought vehicle with the service indicate
that they bought the service for the purpose of reducing the purchasing risk, while 4.7%
for propose of reducing repairing cost, and about 2.0% for self insurance.
Only 0.7% of the respondents indicate that they have very strong experience
about the extended warranty while 12.7% said they have very good experience, while
32% have good experience but 34% indicate that their experience are not bad and 20%
of respondents have very bad experience about extended warranty.
4.7% definitely would like to apply for extended warranty when buying vehicle
while 51.3% probably would like to apply for the service. 40.7% said they might or not
might, about 2.7% would probably like to apply for the service and only 0.7% definitely
would not like to apply for the service of extended warranty.
2.7% from the respondents have very strong recommendation for buying vehicle
with extended warranty, while 20% strongly recommend upon the service, also 70.7%
recommend buying the service and about 6.7% said they don’t recommend buying the
service with the vehicle.
For the interest period of years of extended warranty services that our
respondents would like to buy with the vehicles, 6.7% prefer to apply for only one year
while 12.0% prefer to apply for two years, 36% prefer to apply for three years, while
18.75 prefer to apply for four years and 26.7% prefer to apply for more than four years.
Buying extended warranty can give 4% of the respondents extremely peace of mind,
about 54.7% said they can give them peace of mind while 39.3% are not sure and 2%
said defiantly ‘NO’.
86
4.9
Hypothesis
A statistical hypothesis is an assumption about a population parameter. This
assumption may or may not be true. The best way to determine whether a statistical
hypothesis is true would be to examine the entire population. Since that is often
impractical, if sample data are consistent with the statistical hypothesis, the hypothesis
is accepted; if not, it is rejected, and the hypothesis below represented our statistical
hypothesis:
There is difference between groups in there pattern of responses of:
1. Those who have idea about extended warranty whether Malays, Chinese
or Indian, more likely know the right definition of extended warranty.
2. Those whom have idea about extended warranty either they have a deal
or bought extended warranty before or not, or more likely they prefer to
apply for the service when they intend to buy vehicle, in terms all ethnic
groups.
3. Those who have idea about extended warranty and who haven’t applied
for the service before, at the same time they are much interested to apply
for the extended warranty when they intend to buy vehicle.
4. Those who bought extended warranty service with vehicle, and more
likely they believe extended warranty can give them peace of mind.
87
4.9.1 Chi-Square (χ2) Test of Independence
4.9.1.1
Ethnic Group Comparison
In this test, we are comparing three patterns of frequencies to see if they are
different from each other (independence or not).
Form Table 4.4, presented about 88.9% of all ethnics group who have idea about
extended warranty and they know the right definition.
•
H0 = There is difference between the ethnics group in their pattern of responses
who have idea about extended warranty and they know the right definition
Against
H1 = There is no difference between the ethnics group in their pattern of
responses who have idea about extended warranty and they know the right
definition.
While A χ2 Calculated = .091 (refer to appendix F Table F.30) and χ2 Table
=3.84, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.091 < 3.48), which
is mean A χ2 The percentage of all ethnics group who have idea about extended
warranty and they know the right definition (H0) is accepted at α= .05, which indicates
that the two variables are independent (homogeneous).
To obtain this comparison we have computed the variables of ETHNIC with the
variable of DEFEXTWR=1 (see Table 4.1 and refer to page 76 for the condition 1), and
the computing of two variables has created for us a variable we have named ETNC_IDE
(see Table 4.2), hence by utilizing from cross tabulation statistic we have compared the
variable of ETNC_IDE with the variable of EXTNDWRN (see Table 4.1) to come out
with the statistical comparison as shown in Table 4.4.
88
Table 4.4 Ethnic Group Have an Idea about Extended Warranty VS They Know the
Right Definition-Cross Tabulation
people who have an
idea and they know
the right definition
yes
Ethnic
Total
Malay
Count
Chinese
% within
Ethnic
Count
Indian
% within
Ethnic
Count
% within
Ethnic
Count
% within
Ethnic
no
41
83.7%
Total
8
16.3%
49
100.0%
26
0
26
100.0%
.0%
100.0%
5
1
6
83.3%
16.7%
100.0%
72
9
81
88.9%
11.1%
100.0%
89
Form Table 4.5, we can describe 55.5% of all ethnic groups that have idea about
extended warranty whether they bought or not and they will prefer apply for extended
warranty when they are buying vehicle
•
H0 = There is difference between the ethnics group in their pattern of responses
that have idea about extended warranty whether they bought or not and they will
prefer apply for extended warranty when they are buying vehicle
Against
H1 = There is no difference between the ethnics group in their pattern of
responses that have idea about extended warranty whether they bought
and they don’t prefer apply for extended warranty when they are
or not
buying
vehicle
While A χ2 Calculated = .501 (refer to appendix F Table F.34) and χ2 Table
=15.51, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.501 < 15.51),
which is mean A χ2 test of independence of ethnic groups that have idea about extended
warranty whether they bought or not and they will prefer apply for extended warranty
when they are buying vehicle (H0) is accepted at α= .05, indicates that the variables of
ethnic groups is independent (homogeneous).
To obtain this comparison we have computed the variables of ETHNIC with the
variable of EXTNDWRN (see Table 4.1), and the computing of two variables has
created for us a variable we have named IDEA_ALL (see Table 4.2), hence by utilizing
from cross tabulation statistic we have compared the variable of IDEA_ALL with the
variable of APPEXTWR (see Table 4.1) to come out with the statistical comparison as
shown in Table 4.5.
90
Table 4.5: Ethnic group have idea about extended warranty and either they bought or
not VS Prefer to apply for extended warranty-Cross tabulation
all ethnic Malay
have
ext_idea
and either
they
bought or
not
Chinese
Indian
Total
Count
% within
all ethnic
have
ext_idea
and either
they
bought or
not
Count
% within
all ethnic
have
ext_idea
and either
they
bought or
not
Count
% within
all ethnic
have
ext_idea
and either
they
bought or
not
Count
% within
all ethnic
have
ext_idea
and either
they
bought or
not
Prefer apply for extended warranty
when you buying vehicle
defia
proba defini
ntly proba might
bly
tely
woul
bly
or not woul would
d
would might d not
not
Total
3
35
17
1
1
57
5.3%
61.4
%
29.8
%
1.8%
1.8%
100.0
%
1
22
15
2
0
40
2.5%
55.0
%
37.5
%
5.0%
.0%
100.0
%
1
4
8
0
0
13
7.7%
30.8
%
61.5
%
.0%
.0%
100.0
%
5
61
40
3
1
110
4.5%
55.5
%
36.4
%
2.7%
.9%
100.0
%
91
From Table 4.6, we can describe about 40% of people who have idea about
extended warranty but haven’t applied for the service before, at the same time they are
much interest to apply for the extended warranty when they intend to buy vehicle.
•
H0 = There is difference between the ethnics group in their pattern of responses
who have idea about extended warranty but haven’t applied for the service
before, at the same time they are much interest to apply for the extended
warranty when they intend to buy vehicle.
Against
H1 = There is no difference between the ethnics group in their pattern of
responses who have idea about extended warranty but haven’t applied for the
service before, at the same time they are not interest to apply for the extended
warranty when they intend to buy vehicle.
While A χ2 Calculated = .222 (refer to appendix F Table F.38) And χ2 Table
=15.51, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.222 < 15.51),
which is mean A χ2 test of independence of People who have idea about extended
warranty but haven’t applied for the service before, at the same time they are much
interest to apply for the extended warranty when they intend to buy vehicle (H0) is
accepted at α= .05, indicates that the two variables are independent (homogeneous).
To obtain this comparison we have computed the variables of ETHNIC with the
variable of EXTNDWRN (see Table 4.1), hence the result that we have obtained from
computing the two variables has given the name ETH_IDEA (see Table 4.2), then we
have computed also the variable of ETH_IDEA with the variable of BGHEXTPR=2
(see Table 4.1 and refer to page 76 for the condition 2), and the computing of two
variables has created for us a variable we have named WL_IDEA (see Table 4.2), hence
by utilizing from cross tabulation statistic we have compared the variable of WL_IDEA
with the variable of ENTRSTB (see Table 4.1) to come out with the statistical
comparison as shown in Table 4.6.
92
Table 4.6: Ethnic Group Have Idea About Extended And Did Not Bought Before Vs
The Interesting Toward Extended Warranty- Cross Tabulation
all
ethnic Malay
have idea
about
extended
and did not
bought
before
Chinese
Indian
Total
Count
% within all
ethnic have
idea about
extended
and did not
bought
before
Count
% within all
ethnic have
idea about
extended
and did not
bought
before
Count
% within all
ethnic have
idea about
extended
and did not
bought
before
Count
% within all
ethnic have
idea about
extended
and did not
bought
before
If you interest to buy an extended
warranty with your vehicle, how many
extended warranty period you like to
buy
more
1
2
3
4
than 4
year years years years years
4
5
11
4
7
12.9
%
16.1
%
35.5
%
1
0
8
5.3%
.0%
42.1
%
0
0
5
.0%
.0%
50.0
%
5
5
24
8.3%
8.3%
40.0
%
Total
31
12.9
100.0
22.6%
%
%
2
8
19
10.5
100.0
42.1%
%
%
3
2
10
30.0
100.0
20.0%
%
%
9
17
60
15.0
100.0
28.3%
%
%
93
Form Table 4.7, we can describe about 60% of all ethnics group that have
bought extended warranty service with vehicle, and more likely they believe extended
warranty can give them peace of mind.
•
H0 = There is difference between the ethnics group in their pattern of responses
that have bought extended warranty service with vehicle, and more likely they
believe extended warranty can give them peace of mind.
Against
H1 = There is no difference between the ethnics group in their pattern of
responses that have bought extended warranty service with vehicle, and more
likely they don’t believe extended warranty can give them peace of mind.
While A χ2 Calculated = .225 (refer to appendix F Table F.42) And χ2 Table
=5.99, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.225 < 5.99), which
is mean A χ2 test of independence of the Ethnics group that have bought extended
warranty service with vehicle, and more likely they believe extended warranty can give
them peace of mind (H0) is accepted at α= .05, indicates that the two variables are
independent (homogeneous).
To obtain this comparison we have computed the variables of ETHNIC with the
variable of BGHWTHEX=1 (see Table 4.1 and refer to page 76 for the condition 1),
and the computing of two variables has created for us a variable we have named
ETHN_PEX (see Table 4.2), hence by utilizing from cross tabulation statistic we have
compared the variable of ETHN_PEX with the variable of THNKBYEX (see Table 4.1)
to come out with the statistical comparison as shown in Table 4.7
94
Table 4.7 Ethnic Groups That Bought Extended With Vehicle Vs Thinking Buying
Extended Warranty Can Give You Peace of Mind-Cross Tabulation
Do you think buying extended
warranty can give you peace of
mind?
Extremely
yes
all
ethnic Malay
groups
that
bought
extended with
vehicle
Chinese
Count
% within all
ethnic groups
that
bought
extended with
vehicle
Count
% within all
ethnic groups
that
bought
extended with
vehicle
Total
Count
% within all
ethnic groups
that
bought
extended with
vehicle
yes
not sure
Total
1
8
4
13
7.7%
61.5%
30.8%
100.0%
1
1
0
2
50.0%
50.0%
.0%
100.0%
2
9
4
15
13.3%
60.0%
26.7%
100.0%
95
4.9.1.2
Income Comparison
In this test, we are comparing three patterns of frequencies to see if they are
different from each other (independence or not).
Form Table 4.8, we present about 88.9% of income group who have idea about
extended warranty and they know the right definition.
H0 = There is difference between the Income group in their pattern of responses
who have idea about extended warranty and they know the right definition.
Against
H0 = There is no difference between the Income group in their pattern of
responses who have idea about extended warranty and they know the right
definition.
While A χ2 Calculated = .063 (refer to appendix F Table F.58) And χ2 Table
=7.82, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.063 < 7.82), which
is mean A χ2 test of independence of Income group who have idea about extended
warranty and they know the right definition (H0) at α= .05 which indicates that the two
variables are independent (homogeneous).
To obtain this comparison we have computed the variables of INCOME with the
variable of DEFEXTWR=1 (see Table 4.1 and refer to page 76 for the condition 1), and
the computing of two variables has created for us a variable we have named INCO_IVV
(see Table 4.2), hence by utilizing from cross tabulation statistic we have compared the
variable of INCO_IVV with the variable of EXTNDWRN (see Table 4.1) to come out
with the statistical comparison as shown in Table 4.8.
96
Table 4.8 Income Group Know the Right Definition VS They Know Extended
Warranty-Cross Tabulation
Extended
Warranty
yes
income know under 1000RM Count
the
right
%
within
definition
income know
the
right
definition
1000RmCount
3000Rm
%
within
income know
the
right
definition
3000RMCount
5000RM
%
within
income know
the
right
definition
above 5000RM Count
Total
%
within
income know
the
right
definition
Count
%
within
income know
the
right
definition
no
Total
18
6
24
75.0%
25.0%
100.0%
38
3
41
92.7%
7.3%
100.0%
15
0
15
100.0%
.0%
100.0%
1
0
1
100.0%
.0%
100.0%
72
9
81
88.9%
11.1%
100.0%
97
Form Table 4.9, we can describe about 55.5% of income groups that have idea
about extended warranty whether they bought or not and they will prefer apply for
extended warranty when they are buying vehicle.
•
H0 = There is difference between the Income group in their pattern of responses
that have idea about extended warranty whether they bought or not and they will
prefer apply for extended warranty when they are buying vehicle.
Against
H1 = There is no difference between the Income group in their pattern of
responses that have idea about extended warranty whether they bought or not
and they do not prefer apply for extended warranty when they are buying
vehicle.
While A χ2 Calculated = .225 (refer to appendix F Table F.70) And χ2 Table
=21.03, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.225 < 21.03),
which is mean A χ2test of independence of income groups that have idea about extended
warranty whether they bought or not and they will prefer apply for extended warranty
when they are buying vehicle (H0) is accepted at α= .05, indicates that the variables of
ethnic groups is independent (homogeneous).
To obtain this comparison we have computed the variables of INCOME with the
variable of EXTNDWRN (see Table 4.1), and the computing of two variables has
created for us a variable we have named IN_IDEA (see Table 4.2), hence by utilizing
from cross tabulation statistic we have compared the variable of IN_IDEA with the
variable of APPEXTWR (see Table 4.1) to come out with the statistical comparison as
shown in Table 4.9.
98
Table 4.9 Income Group That Have Idea about Extended and Either They Bought or
Not Vs Prefer Apply For Extended Warranty-Cross Tabulation
Income group under 1000RM
that have idea
abou extended
and either they
bought or not
1000Rm3000Rm
3000RM5000RM
above 5000RM
Total
Count
%
within
Income group
that have idea
abou extended
and either they
bought or not
Count
%
within
Income group
that have idea
abou extended
and either they
bought or not
Count
%
within
Income group
that have idea
abou extended
and either they
bought or not
Count
%
within
Income group
that have idea
abou extended
and either they
bought or not
Count
%
within
Income group
that have idea
abou extended
and either they
bought or not
Prefer apply for extended warranty when
you buying vehicle
proba definite
defiant probab might
by
ly
ly
ly
or not would
would
would
would
might
not
not
1
12
11
3
Total
27
100.0
%
3.7%
44.4%
40.7%
11.1%
2
33
24
1
60
3.3%
55.0%
40.0%
1.7%
100.0
%
2
14
5
21
9.5%
66.7%
23.8%
100.0
%
2
2
100.0
%
100.0
%
5
61
40
3
1
110
4.5%
55.5%
36.4%
2.7%
.9%
100.0
%
99
From Table 4.10, we can describe about 40% of income group who have idea
about extended warranty but haven’t applied for the service before, at the same time
they are much interest to apply for the extended warranty when they intend to buy
vehicle.
•
H0 = There is difference between the Income group in their pattern of responses
who have idea about extended warranty but haven’t applied for the service
before, at the same time they are much interest to apply for the extended
warranty when they intend to buy vehicle.
Against
H1 = There is no difference between the Income group in their pattern of
responses who have idea about extended warranty but haven’t applied for the
service before, at the same time they are not interest to apply for the extended
warranty when they intend to buy vehicle.
While A χ2 Calculated = .807 (refer to appendix F Table F.82) And χ2 Table
=15.51, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.807 < 15.51),
which is mean A χ2test of independence of Income group who have idea about extended
warranty but haven’t applied for the service before, at the same time they are much
interest to apply for the extended warranty when they intend to buy vehicle (H0) is
accepted at α= .05, indicates that the two variables are independent (homogeneous).
To obtain this comparison we have computed the variables of INCOME with the
variable of EXTNDWRN (see Table 4.1), hence the result that we have obtained from
computing the two variables has given the name ETH_IDEA (see Table 4.2), then we
have computed also the variable of ETH_IDEA with the variable of BGHEXTPR=2
(see Table 4.1 and refer to page 76 for the condition 2), and the computing of two
variables has created for us a variable we have named IN_WL (see Table 4.2), hence by
utilizing from cross tabulation statistic we have compared the variable of IN_WL with
the variable of ENTRSTB (see Table 4.1) to come out with the statistical comparison as
shown in Table 4.10.
100
Table 4.10 Income Group That Have Idea But They Did Not Bought VS the Interesting
Toward Extended Warranty-Cross Tabulation
Income
under
group that 1000RM
have idea
but they did
not bought
1000Rm3000Rm
3000RM5000RM
Total
If you interest to buy an extended
warranty with your vehicle, how
many extended warranty period you
like to buy
more
1
2
3
4
than 4
year years years years years Total
2
2
7
1
4
16
Count
%
within
Income
group that 12.5 12.5
have idea
%
%
but they did
not bought
Count
3
2
%
within
Income
group that
8.1% 5.4%
have idea
but they did
not bought
Count
1
%
within
Income
group that
14.3
have idea
%
but they did
not bought
Count
5
5
%
within
Income
group that
8.3% 8.3%
have idea
but they did
not bought
43.8
%
6.3%
14
6
37.8
%
16.2
%
3
2
42.9
%
28.6
%
24
9
40.0
%
15.0
%
25.0 100.0
%
%
12
37
32.4 100.0
%
%
1
7
14.3 100.0
%
%
17
60
28.3 100.0
%
%
101
Form Table 4.11, we describe that about 62.5% of income group that have
bought extended warranty service with vehicle, and more likely they believe extended
warranty can give them peace of mind.
•
H0 = There is difference between the Income group in their pattern of responses
that have bought extended warranty service with vehicle, and more likely they
believe extended warranty can give them peace of mind.
Against
H1 = There is no difference between the Income group in their pattern of
responses that have bought extended warranty service with vehicle, and more
likely they believe extended warranty can not give them peace of mind.
While A χ2 Calculated = .930 (refer to appendix F Table F.93) And χ2 Table
=15.59, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.930 < 15.59),
which is mean A χ2 test of independence of Income group that have bought extended
warranty service with vehicle, and more likely they believe extended warranty can give
them peace of mind (H0) is accepted at α= .05, indicates that the two variables are
independent (homogeneous).
To obtain this comparison we have computed the variables of INCOME with the
variable of BGHWTHEX=1 (see Table 4.1 and refer to page 76 for the condition 1),
and the computing of two variables has created for us a variable we have named
IN_BUGHT (see Table 4.2), hence by utilizing from cross tabulation statistic we have
compared the variable of IN_BUGHT with the variable of THNKBYEX (see Table 4.1)
to come out with the statistical comparison as shown in Table 4.11.
102
Table 4.11 Income Group That Have Bought Vehicle with Extended Warranty VS
Buying Extended Warranty Can Give You Peace of Mind-Cross Tabulation
Do you think buying extended
warranty can give you peace
of mind?
Extremely
not
yes
yes
sure
income
group under 1000RM
that
bought
vechile
with
extended
warranty
1000Rm3000Rm
3000RM5000RM
above 5000RM
Total
Total
Count
% within income
group
that
bought vechile
with
extended
warranty
Count
% within income
group
that
bought vechile
with
extended
warranty
Count
% within income
group
that
bought vechile
with
extended
warranty
Count
% within income
group
that
bought vechile
with
extended
warranty
Count
% within income
group
that
bought vechile
with
extended
warranty
3
1
4
75.0%
25.0%
100.0%
1
4
2
7
14.3%
57.1%
28.6%
100.0%
1
2
1
4
25.0%
50.0%
25.0%
100.0%
1
1
100.0%
100.0%
2
10
4
16
12.5%
62.5%
25.0%
100.0%
103
4.9.1.3
Age Group Comparison
In this test, we are comparing three patterns of frequencies to see if they are
different from each other (independence or not).
Form Table 4.12, we present about 88.9% of age group who have idea about
extended warranty and they know the right definition.
•
H0 = There is difference between the Age group in their pattern of responses
who have idea about extended warranty and they know the right definition.
Against
H1 = There is no difference between the Age group in their pattern of responses
who have idea about extended warranty and they don’t know the right definition.
While A χ2 Calculated = .083 (refer to appendix F Table F.62) And χ2 Table
=5.99, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.083 < 5.99), which
is mean A χ2 test of independence of age group idea of the extended warranty and the
right definitions of the extended warranty (H0) is accepted at α= .05, which indicates
that the two variables are independent (homogeneous).
To obtain this comparison we have computed the variables of AGE with the
variable of DEFEXTWR=1 (see Table 4.1 and refer to page 76 for the condition 1), and
the computing of two variables has created for us a variable we have named AGE_IDE
(see Table 4.2), hence by utilizing from cross tabulation statistic we have compared the
variable of AGE_IDE with the variable of EXTNDWRN (see Table 4.1) to come out
with the statistical comparison as shown in Table 4.12.
104
Table 4.12 Age Group Know the Right Definition Vs Idea about Extended Warranty
Cross Tabulation
Extended Warranty
yes
age know the 18-25
right definition
Count
% within age
know the right
definition
25-35
Count
% within age
know the right
definition
35-above
Count
% within age
know the right
definition
Total
Count
% within age
know the right
definition
no
Total
23
6
29
79.3%
20.7%
100.0%
33
3
36
91.7%
8.3%
100.0%
16
0
16
100.0%
.0%
100.0%
72
9
81
88.9%
11.1%
100.0%
105
Form Table 4.13, we can describe about 55.5% of age groups that have idea
about extended warranty whether they bought or not and they will prefer apply for
extended warranty when they are buying vehicle.
•
H0 = There is difference between the Age group in their pattern of responses that
have idea about extended warranty whether they bought or not and they will
prefer apply for extended warranty when they are buying vehicle.
Against
H1 = There is no difference between the Age group in their pattern of responses
that have idea about extended warranty whether they bought or not and they do
not prefer apply for extended warranty when they are buying vehicle.
While A χ2 Calculated = .020 (refer to appendix F Table F.74) And χ2 Table
=15.51, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.020 < 15.51),
which is mean A χ2 test of independence of Age groups that have idea about extended
warranty whether they bought or not and they will prefer apply for extended warranty
when they are buying vehicle (H0) is accepted at α= .05, indicates that the variables of
ethnic groups is independent (homogeneous).
To obtain this comparison we have computed the variables of AGE with the
variable of EXTNDWRN (see Table 4.1), and the computing of two variables has
created for us a variable we have named AGE_IDE (see Table 4.2), hence by utilizing
from cross tabulation statistic we have compared the variable of AGE_IDE with the
variable of APPEXTWR (see Table 4.1) to come out with the statistical comparison as
shown in Table 4.13.
106
Table 4.13 Age Group That Have Idea About Extended Either They Bought or Not VS
Prefer Apply For Extended Warranty-Cross Tabulation
Prefer apply for extended warranty when you
buying vehicle
might
probab definitel
defiantl probabl or not y would y would
y would y would might
not
not
age
18-25
group
that have
idea
abou
extended
and
either
they
bought
or not
25-35
35-above
Total
Total
Count
% within age
group
that
have
idea
abou
extended and
either
they
bought or not
Count
% within age
group
that
have
idea
abou
extended and
either
they
bought or not
Count
% within age
group
that
have
idea
abou
extended and
either
they
bought or not
Count
% within age
group
that
have
idea
abou
extended and
either
they
bought or not
1
12
16
3
1
33
3.0%
36.4%
48.5%
9.1%
3.0%
100.0
%
2
28
19
49
4.1%
57.1%
38.8%
100.0
%
2
21
5
28
7.1%
75.0%
17.9%
100.0
%
5
61
40
3
1
110
4.5%
55.5%
36.4%
2.7%
.9%
100.0
%
107
From Table 4.14, we can describe about 40% of age group who have idea about
extended warranty but haven’t applied for the service before, at the same time they are
much interest to apply for the extended warranty when they intend to buy vehicle.
•
H0 = There is difference between the Age group in their pattern of responses
who have idea about extended warranty but haven’t applied for the service
before, at the same time they are much interest to apply for the extended
warranty when they intend to buy vehicle.
Against
H1 = There is no difference between the Age group in their pattern of responses
who have idea about extended warranty but haven’t applied for the service
before, at the same time they are not interest to apply for the extended warranty
when they intend to buy vehicle.
While A χ2 Calculated = .528 (refer to appendix F Table F.86) And χ2 Table
=15.51, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.528 < 15.51),
which is mean A χ2 test of independence of Age group who have idea about extended
warranty but haven’t applied for the service before, at the same time they are much
interest to apply for the extended warranty when they intend to buy vehicle (H0) is
accepted at α= .05, indicates that the two variables are independent (homogeneous).
To obtain this comparison we have computed the variables of AGE with the
variable of EXTNDWRN (see Table 4.1), hence the result that we have obtained from
computing the two variables has given the name AGE_IDE (see Table 4.2), then we
have computed also the variable of AGE_IDE with the variable of BGHEXTPR=2 (see
Table 4.1 and refer to page 76 for the condition 2), and the computing of two variables
has created for us a variable we have named AG_WL (see Table 4.2), hence by utilizing
from cross tabulation statistic we have compared the variable of AG_WL with the
variable of ENTRSTB (see Table 4.1) to come out with the statistical comparison as
shown in Table 4.14.
108
Table 4.14 Age group that have idea but they did not bought Vs The Interesting
Toward Extended Warranty-Cross Tabulation
Age group 18-25
that have
idea
but
they
did
not bought
25-35
35-above
Total
Count
If you interest to buy an extended
warranty with your vehicle, how many
extended warranty period you like to buy
more
2
3
4
than 4
1 year years years years
years
3
4
8
2
6
%
within
Age group
that have
13.0% 17.4% 34.8%
idea
but
they
did
not bought
Count
1
1
12
%
within
Age group
that have
3.6%
3.6% 42.9%
idea
but
they
did
not bought
Count
1
4
%
within
Age group
that have
11.1%
44.4%
idea
but
they
did
not bought
Count
5
5
24
%
within
Age group
that have
8.3%
8.3% 40.0%
idea
but
they
did
not bought
Total
23
8.7%
26.1%
100.0
%
6
8
28
21.4%
28.6%
100.0
%
1
3
9
11.1%
33.3%
100.0
%
9
17
60
15.0%
28.3%
100.0
%
109
Form Table 4.15, we can describe about 62.5% of age group that have bought
extended warranty service with vehicle, and more likely they believe extended warranty
can give them peace of mind.
•
H0 = There is difference between the Age group in their pattern of responses that
have bought extended warranty service with vehicle, and more likely they
believe extended warranty can give them peace of mind.
Against
H1 = There is no difference between the Age group in their pattern of responses
that have bought extended warranty service with vehicle, and more likely they
believe extended warranty can not give them peace of mind.
While A χ2 Calculated = .432 (refer to appendix F Table F.101) And χ2 Table
=9.49, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.432 < 9.49), which
is mean A χ2 test of independence of Age group that have bought extended warranty
service with vehicle, and more likely they believe extended warranty can give them
peace of mind (H0) is accepted at α= .05, indicates that the two variables are
independent (homogeneous).
To obtain this comparison we have computed the variables of AGE with the
variable of BGHWTHEX=1 (see Table 4.1 and refer to page 76 for the condition 1),
and the computing of two variables has created for us a variable we have named
AG_BUGHT (see Table 4.2), hence by utilizing from cross tabulation statistic we have
compared the variable of AG_BUGHT with the variable of THNKBYEX (see Table
4.1) to come out with the statistical comparison as shown in Table 4.15.
110
Table 4.15 Age Group That Bought Vechile with Extended Warranty Vs Thinking
Buying Extended Warranty Can Give You Peace of Mind-Cross Tabulation
age
group 18-25
that bought
vechile with
extended
warranty
25-35
35-above
Total
Count
% within age
group
that
bought
vechile with
extended
warranty
Count
% within age
group
that
bought
vechile with
extended
warranty
Count
% within age
group
that
bought
vechile with
extended
warranty
Count
% within age
group
that
bought
vechile with
extended
warranty
Do you think buying
extended warranty can give
you peace of mind?
Extremely
not
yes
yes
sure
2
1
Total
3
66.7%
33.3%
100.0
%
1
3
3
7
14.3%
42.9%
42.9%
100.0
%
1
5
6
16.7%
83.3%
100.0
%
2
10
4
16
12.5%
62.5%
25.0%
100.0
%
111
4.9.1.4
Gender Group Comparison
In this test, we are comparing three patterns of frequencies to see if they are
different from each other (independence or not).
Form Table 4.16, we describe that about 88.9% of gender group who have idea
about extended warranty and they know the right definition.
•
H0 = There is difference between the Gender group in their pattern of responses
who have idea about extended warranty and they know the right definition.
Against
H1 = There is no difference between the Gender group in their pattern of
responses who have idea about extended warranty and they don’t know the right
definition.
While A χ2 Calculated = .071 (refer to appendix F Table F.66) And χ2 Table
=3.84, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.071 < 3.48), which
is mean A χ2 test of independence of Gender group who have idea about extended
warranty and they know the right definition (H0) is accepted at α= .05, which indicates
that the two variables are independent (homogeneous).
To obtain this comparison we have computed the variables of GENDER with
the variable of DEFEXTWR=1 (see Table 4.1 and refer to page 76 for the condition 1),
and the computing of two variables has created for us a variable we have named
GEND_IDE (see Table 4.2), hence by utilizing from cross tabulation statistic we have
compared the variable of GEND_IDE with the variable of EXTNDWRN (see Table 4.1)
to come out with the statistical comparison as shown in Table 4.16
112
Table 4.16 Gender Know the Right Definition VS Idea about Extended Warranty Cross Tabulation
Extended Warranty
yes
gender know male
the
right
definition
39
2
41
95.1%
4.9%
100.0%
33
7
40
82.5%
17.5%
100.0%
72
9
81
88.9%
11.1%
100.0%
Count
%
within
gender know
the
right
definition
Total
Total
Count
%
within
gender know
the
right
definition
female
no
Count
%
within
gender know
the
right
definition
113
Form Table 4.17, we can describe that about 55.5% of gender groups that have
idea about extended warranty whether they bought or not and they will prefer apply for
extended warranty when they are buying vehicle.
•
H0 = There is difference between the Gender group in their pattern of responses
that have idea about extended warranty whether they bought or not and they will
prefer apply for extended warranty when they are buying vehicle.
Against
H1 = There is no difference between the Gender group in their pattern of
responses that have idea about extended warranty whether they bought or not
and they not prefer apply for extended warranty when they are buying vehicle.
While A χ2 Calculate = .907 (refer to appendix F Table F.78) And χ2 Table
=9.49, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.907 < 9.49), which
is mean A χ2 test of independence of Gender groups that have idea about extended
warranty whether they bought or not and they will prefer apply for extended warranty
when they are buying vehicle (H0) is accepted at α= .05, indicates that the variables of
ethnic groups is independent (homogeneous).
To obtain this comparison we have computed the variables of GENDER with
the variable of EXTNDWRN (see Table 4.1), and the computing of two variables has
created for us a variable we have named GEN_IDEA (see Table 4.2), hence by utilizing
from cross tabulation statistic we have compared the variable of GEN_IDEA with the
variable of APPEXTWR (see Table 4.1) to come out with the statistical comparison as
shown in Table 4.17.
114
Table 4.17 Gender That Have Idea about Extended and Either They Bought or Not Vs
Prefer Apply For Extended Warranty-Cross Tabulation
Prefer apply for extended warranty
when you buying vehicle
proba definit
defian proba might
by
ely
tly
bly
or not would would
would would might
not
not
gender
that have
idea abou
extended
and either
they
bought or
not
male
Count
3
female
Total
Total
%
within
gender that
have idea
abou
extended
and either
they bought
or not
Count
%
within
gender that
have idea
abou
extended
and either
they bought
or not
Count
%
within
gender that
have idea
abou
extended
and either
they bought
or not
24
2
1
64
4.7% 53.1% 37.5%
3.1%
1.6%
100.0
%
2
34
16
1
46
4.3% 58.7% 34.8%
2.2%
100.0
%
5
27
61
40
3
1
110
4.5% 55.5% 36.4%
2.7%
.9%
100.0
%
115
From Table 4.18, we can describe the percentage of gender group who have idea
about extended warranty but haven’t applied for the service before, at the same time
they are much interest to apply for the extended warranty when they intend to buy
vehicle.
•
H0 = There is difference between the Gender group in their pattern of responses
who have idea about extended warranty but haven’t applied for the service
before, at the same time they are much interest to apply for the extended
warranty when they intend to buy vehicle.
Against
H1 = There is no difference between the Gender group in their pattern of
responses who have idea about extended warranty but haven’t applied for the
service before, at the same time they not much interest to apply for the extended
warranty when they intend to buy vehicle.
While A χ2 Calculated = .749 (refer to appendix F Table F.89) And χ2 Table
=9.49, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.749 < 9.49), which
is mean A χ2 test of independence of Gender group who have idea about extended
warranty but haven’t applied for the service before, at the same time they are much
interest to apply for the extended warranty when they intend to buy vehicle (H0) is
accepted at α= .05, indicates that the two variables are independent (homogeneous).
To obtain this comparison we have computed the variables of GENDER with
the variable of EXTNDWRN (see Table 4.1), hence the result that we have obtained
from computing the two variables has given the name GEN_IDEA (see Table 4.2), then
we have computed also the variable of GEN_IDEA with the variable of BGHEXTPR=2
(see Table 4.1 and refer to page 76 for the condition 2), and the computing of two
variables has created for us a variable we have named GEN_WL (see Table 4.2), hence
by utilizing from cross tabulation statistic we have compared the variable of GEN_WL
with the variable of ENTRSTB (see Table 4.1) to come out with the statistical
comparison as shown in Table 4.18.
116
Table 4.18 Gender That Have Idea But They Did Not Bought Vs The Interesting
Toward Extended Warranty-Cross Tabulation
If you interest to buy an extended warranty with
your vehicle, how many extended warranty period
you like to buy
1 year
Gender that male
have idea but
they did not
bought
female
2 years
3 years
4 years
Total
3
2
15
6
8
34
8.8%
5.9%
44.1%
17.6%
23.5%
100.0%
2
3
9
3
9
26
7.7%
11.5%
34.6%
11.5%
34.6%
100.0%
5
5
24
9
17
60
8.3%
8.3%
40.0%
15.0%
28.3%
100.0%
Count
%
within
Gender that
have idea but
they did not
bought
Count
%
within
Gender that
have idea but
they did not
bought
Total
more
than 4
years
Count
%
within
Gender that
have idea but
they did not
bought
117
Form Table 4.19, we can describe that about 62.5% of gender group that have
bought extended warranty service with vehicle, and more likely they believe extended
warranty can give them peace of mind.
•
H0 = There is difference between the Gender group in their pattern of responses
that have bought extended warranty service with vehicle, and more likely they
believe extended warranty can give them peace of mind.
Against
H1 = There is no difference between the Gender group in their pattern of
responses that have bought extended warranty service with vehicle, and more
likely they don’t believe extended warranty can give them peace of mind.
While A χ2 Calculated = .223 (refer to appendix F Table F.97) And χ2 Table
=5.99, (refer to appendix G), A χ2 Calculate is less than A χ2 Table (.223 < 5.99), which
is mean A χ2 test of independence of Gender group that have bought extended warranty
service with vehicle, and more likely they believe extended warranty can give them
peace of mind (H0) is accepted at α= .05, indicates that the two variables are
independent (homogeneous).
To obtain this comparison we have computed the variables of GENDER with
the variable of BGHWTHEX=1 (see Table 4.1 and refer to page 76 for the condition 1),
and the computing of two variables has created for us a variable we have named
GN_BUGHT (see Table 4.2), hence by utilizing from cross tabulation statistic we have
compared the variable of GN_BUGHT with the variable of THNKBYEX (see Table
4.1) to come out with the statistical comparison as shown in Table 4.19.
118
Table 4.19 Gender Group That Bought Vehicle with Extended Warranty Vs Thinking
Buying Extended Warranty Can Give You Peace of Mind-Cross Tabulation
Do you think buying extended
warranty can give you peace of mind?
Extremely
yes
gender
group male
that
bought
vechile
with
extended
warranty
female
Count
% within gender
group
that
bought vechile
with
extended
warranty
yes
5
1
8
25.0%
62.5%
12.5%
100.0%
5
3
8
62.5%
37.5%
100.0%
2
10
4
16
12.5%
62.5%
25.0%
100.0%
Count
Count
% within gender
group
that
bought vechile
with
extended
warranty
Total
2
% within gender
group
that
bought vechile
with
extended
warranty
Total
not sure
119
4.10
Chapter Summary
This chapter started with the analyzes of our data collection method from the
questionnaire instrumental that was designed, using SPSS software as technical utilizing
tools as an application to key in the collected data. The chapter also presented the data
obtained in the survey and concluded with a detailed analysis of the result obtained in
the survey.
CHAPTER 5
FINIDINGS
5.1
Introduction
After analyzing the data collected, this chapter discussed in broad what was
obtained from the pervious Chapter utilizing SPSS software.
5.2
Part One Result
After the analysis of data collection, it was found that the great majority (98.7%)
of our respondents expressed knowledge and idea about warranty (98.7%) and a few did
121
not (1.3%). Those that bought product with warranty before, about 97.3% and 2.7%
never did.
Relatively, three-quarter (74%) of our respondents had idea about the terms of
extended warranty, which means extended warranty policy is becoming gradually
known to the Malaysian consumers. Approximately half of the respondents that had
idea about extended warranty had dealt with the term before, about 34.7% have bought
product with extended warranty services, and most this knowledge came through
salespersons. In terms of definition of the extended warranty which was used to ask our
respondents, majority got right definition (54%) and approximately 21.3% it wrong
definition and 24.7% do not know.
5.3
Part Two Result
In the second part of the questionnaire, the respondents that had vehicles were
asked whether they bought extended warranty service with the vehicles or not and only
10% of the respondents said they bought extended warranty services for the vehicles,
and about 90% never bought extended warranty services before. In the next question of
the second part we also asked about the period of the service that was bought by the
respondents, whether one, two or up to more than five years and we found that about
2% applied for one year from the service, 4.7% applied for extra two years, 1.3%
applied for three more extra years and about 2% had applied for more than five years. It
can be seen from the number of years that have been applied by respondents, two extra
years had the highest percentage.
122
2.7% recently bought the service with the vehicle, 4% also bought the extended
warranty service with in less than one year, and 0.7% bought the service in less than
two years as well as less than three yeas and 2% for more than three years.
During the research investigation, we also asked the respondents that bought the
service whether they used the t since they applied for it or not and we found that about
7.3% have used the service and only 2.7% have not used it. About 2.7% used the
service one time as well as two times, 1.3% have used the service for three times and
only 0.7% used it for more than five times.
We found also that the percentage of respondents who applied for extended
warranty service in the same time they bought their vehicles was much more than those
who applied for the service after buying the vehicles. About 4.7% indicated that they
bought the extended warranty service at the same time and 5.3% haven’t applied for the
service at the same time. In terms of price of the service, about 2.0% indicated that the
price is very cheap as well as also indicate to cheap price while the price was barely
acceptable to 3.3% of the respondents, also 2.0% they said the price is expensive and
only 0.75% said the price is very expensive.
Most of the respondents that applied for extended warranty with vehicles did so
because they believe it can prevent or reduce the cost of repair in case of breakdown or
damages. About 4.7% of those that bought extended warranty with the vehicle indicated
the reason, while 3.3% of respondents that bought vehicle with the service indicated that
they bought the service for the propose of reducing the purchasing risk, and about 2.0%
applied just for self insurance.
123
5.4
Part Three Result
The respondents were asked if they can evaluate their experience in terms of
knowledge about the extended warranty policy and this was classified in five categories,
and each class was represented as whether the respondents had very strong experience,
very good experience, good experience, not bad experience or very bad experience and
don’t have experience at all. We found that the percentage of those that had good
experience and those whose experience about the extended warranty was not bad to be
approximately similar. 34% said their experience was not bad while 32% said their
experience was good about the term, and 12.7% had very good experience, while 20%
of respondents had very bad experience about extended warranty. Only 0.7% from the
respondents indicated they had very strong experience about the extended warranty.
The respondents were asked if they prefer to apply for extended warranty
service when buying vehicles and we found that a higher percentage of respondents
would probably like to apply for extended warranty when buying vehicle which
represent 51.3%. 40.7% might or might not apply while about 2.7% probably would not
like to apply for the service. Only 0.7% would definitely not like to apply for the
service, it seems majority of the respondents prefer to apply for the extended warranty
service when buying vehicle.
Recommendation of consumers toward the extended warranty service was
classified into five categories beginning with very strong recommendation until very
bad recommendation. The result showed a high percentage of respondents that
recommend to buy the service representing 70.7%, followed by 20% that had strong
recommendation upon the service, while 6.7% of the respondents did not recommend to
buy the service and 2.7% of the respondents had very strong recommendation for
buying vehicle with extended warranty.
For the interest period of years of extended warranty services that our
respondents would like to buy with the vehicles, 6.7% prefer to apply for only one year
124
while 12.0% prefer to apply for two years. 36% prefer to apply for three years, while
18.75 prefer to apply for four years and 26.7% prefer to apply for more than four years.
From the buyers’ point of view, the basic purpose of a warranty is to reduce the
risk and give the consumer peace of mind, as such, we raised this in the last question of
the questionnaire weather or not extended warranty can give the Malaysian consumer a
peace of mind. Here it was classified into five classes, starting with Extremely Yes,
Yes, Not Sure, No, to finally definitely ‘No’. The result of this question showed that
buying extended warranty can give 4% of the respondents extremely peace of mind,
while about 54.7% said Yes to it and 39.3% said not sure and 2% said defiantly no.
5.6
Degree of Knowledge
In terms of ethnic groups, we compared between those that had idea about
extended warranty and know the right definition to evaluate which of the Malaysians
are more knowledgeable about the term. Before that, we had compared them as general
in knowing if the Malaysian consumers had knowledge about extended warranty or not,
and was classified into the ethnic group perspective.
The result we got as shown in Figure 5.1, revealed that the number of Malaysian
consumers that had idea about extended warranty and choose the right definition was
quite high, about 88.9% which implies that extended warranty has become popular to
Malaysian consumers.
125
100
16
100
17
90
80
84
83
70
60
50
40
30
Extended Warranty
Count
20
no
10
0
yes
Malay
chinese
india
Figure 5.1: Ethnic Group Having Idea About Extended Warranty and Know the Right
Definition
We also investigated the degree of knowledge of each Malaysian ethnic group
and the result showed that the higher ethnic groups that had idea about extended
warranty and choose the right definition were the Chinese. The result indicated 100%
which means that all the Chinese have very good knowledge about extended warranty.
This was followed by Malays, in which about 83.7% expressed knowledge about
extended warranty and knew the right definition for the terms, representing very good
result. The Malays also had very good knowledge about the terms. There was no
significant different between the Malay and Indian ethnic groups in terms of this
knowledge. The Indians scored about 83.3% which means the Indians also had very
good knowledge about the terms.
After analyzing the Malaysian consumers in terms of ethnic groups it was
observed that most of Malaysian consumers had very good knowledge about extended
warranty.
In terms of income groups and having idea about extended warranty and knew
the right definition of extended warranty, this was classified starting from Under
126
1000RM monthly income, 1000RM-3000RM, 3000RM-5000RM and finally Above
5000RM monthly income.
And the result that obtained after analysis is shown in Figure 5.2 which
indicated that those with monthly income Above of 5000RM and those between
3000RM-5000RM had very good knowledge about the terms of extended warranty,
about 100% of both indicated they had idea about extended warranty knew the right
definition of extended warranty.
100
25
7
90
100
100
93
80
70
75
60
50
40
30
Extended Warranty
Count
20
no
10
0
y es
under 1000RM
3000RM-5000RM
1000Rm-3000Rm
above 5000RM
Figure 5.2 Income Group Having Idea about Extended Warranty and also Know
the Right Definition
From the result we got it shows that those consumers with high income had
better knowledge about extended warranty, and from our point of view it might be
because they had been dealing with the real market and business life.
In terms of age groups those that had idea about extended warranty and knew
the right definition of extended warranty, were classified according to age groups into
three classes, ranging from 18-25 years as first class, then 25-35 years as second class
and finally above 35 years as the last class.
127
The result obtained as shown in Figure 5.3 indicates that experience played a
big roles in showing us classes of age groups that had better knowledge about the term
of extended warranty, because it was expressed consequently from those with age
above 35 years, those with age between 25-35 and those with age between 18-25.About
100% of those with age above 35 years had idea about extended warranty, followed by
91.7% those with age between 25-35 years and finally 79.3% of those with age
between. After analysis, we could say that those with age above of 35 years had very
good knowledge about extended warranty because they have better experience.
100
21
90
8
100
92
80
79
70
60
50
40
30
Extended Warranty
Count
20
no
10
0
yes
18-25
25-35
35-above
Figure 5.3 Age Group Have Idea about Extended Warranty and Know the Right
Definition
In terms of gender group, by default the classification of gender group was
made into two, Male and Female. Those with idea about extended warranty and knew
the right definition of the term extended warranty, as shown in Figure 5.4, it can be seen
that the male have better knowledge about extended than female. About 95.1% of the
male indicated they had good knowledge about extended warranty, and about 82.5% of
female also indicated having good knowledge about extended warranty.
128
100
90
5
18
95
80
83
70
60
50
40
30
Extended Warranty
Count
20
no
10
0
yes
male
f emale
Figure 5.4 Gender Group Have Idea About Extended Warranty and Know the Right
Definition
From the result we have got, it can see that the percentage if male group having
good knowledge about extended warranty was quite higher than female group, this may
be because the male groups are more dominating in the business market more than
female group.
129
5.7
The Reaction Towards New Policy
Comparism was made between those with idea about extended warranty and
whether or not they bought. They prefer to apply for extended warranty with vehicle to
come out, whether the Malaysian consumer welcome the extended warranty as it is a
new policy in Malaysia industrial market or not.
The result as shown in Figure 5.5 seems that in terms of ethnic Malay and
Chinese indicated that they probably would prefer to apply for the extended warranty
when buying vehicles, while the majority of Indians indicated that may or may not
prefer to apply for extended warranty when buying vehicles. The result shows that was
61.4% of Malaysian consumers probably would like and prefer to apply for the service
when they buy vehicles and the lower is represented in 1.8% pointing to probably
would not as well as definitely would not, while 55% of the Chinese indicated that they
would probably like to apply and about 2.5% definitely would like to apply for the
extended warranty. About 61.5% of the Indians said they might or might not apply for
extended warranty service when buying vehicles and the 7.7% would definitely like to
apply.
100
5
30
90
62
38
80
70
61
60
55
50
Prefer apply for ext
40
31
30
probaby w ould not
Count
20
might or not might
probably w ould
10
0
definitely w ould not
8
5
Malay
chinese
defiantly w ould
india
Figure 5.5: Ethnic Group Having Idea and Either Bought Extended Warranty And
Prefer To Apply For Extended Warranty
130
The total number of consumers whether Malay, Chinese or Indian having idea
about extended warranty, either they had deal with it before or not, at the same time
more likely and prefer to apply for extended warranty when buying vehicles is
represented as 55% would probably like to apply, while the lower is percentage was for
those that would not like to apply for the extended warranty as shown Figure 5.2
In terms of perception of Malaysian consumers toward the extended warranty,
we found that the Malaysian consumers welcome the extended warranty, especially
Malay consumers as discussed and showed earlier. This was followed by the Chinese
consumers and then Indian consumers.
In terms of income groups, this was classified as mentioned earlier into four
classes, starting from under 1000RM, 1000RM-3000RM, 3000RM-5000, and finally
above 5000RM. The result we got is shown in Figure 5.6. 55.5% was the highest
percent of income groups having idea about extended warranty probably would like and
prefer to apply for extended warranty when they intend to buy vehicle.
100
11
24
40
100
90
41
80
67
70
60
55
Prefer apply for ext
50
Count
44
40
definitely would not
30
probaby would not
20
might or not might
probably would
10
10
0
defiantly would
under 1000RM
3000RM-5000RM
1000Rm-3000Rm
above 5000RM
Figure 5.6 Income Group Have Idea and Either Bought Extended Warranty and They
Prefer To Apply For Extended Warranty
In details, income group classification can see from the respondents having
income above 5000RM of which all probably would like and prefer to apply for the
131
service represented by 100%, as will as 66.7% for the respondents having income
between 3000RM-5000RM probably would like and prefer to apply. Those with
monthly income between 1000RM-3000RM, about 55% probably would like and prefer
to apply for the service, and finally about 44.4% of the respondents with monthly
income under 1000RM prefer also to apply for the service.
Form the results obtained, it seems that most of the respondents probably would
like and prefer to apply for extended warranty when they intended to buy vehicles, and
the willingness of income group to the term of extended warranty runs consequently,
starting from those with income above 5000RM to those with income under 1000RM.
Therefore, from our point of view whenever the rate of monthly income of the
consumers is high, the willingness of consumers in extended warranty is high also, this
maybe because those with high income had better potential for buying costly vehicles,
and by defaults the high cost vehicles will have better care and interest from its owners.
The age group as mentioned earlier was classified into three classes, ranging
from 18-25 years as first class, 25-35 years as second class and finally above 35 years as
the last class. The result obtained as shown in Figure 5.7 which clearly shows a high
percent of (55.5%) for Malaysian consumers and would like and prefer to apply for
extended warranty when buying vehicles.
High percentage observed on those with age above 35 years, about 75% of them
indicated they probably would like and prefer to apply for the service of extended
warranty, and about 57.1% of the respondents with ages between 25-35 years also
indicated they probably would like as well as much prefer to apply for the service of
extended warranty. Those with age between 18-25 hesitated toward the terms of
extended warranty, most of them indicated that they might or not might to apply for
extended warranty when they intend to buy vehicles, about 48.5% indicated for to that
followed by 36.4% that probably would like and they prefer to apply for extended
warranty.
132
100
9
39
18
90
48
80
75
70
60
57
50
Prefer apply for ext
40
definitely would not
Count
36
30
probaby would not
20
might or not might
10
probably would
4
0
18-25
25-35
7
defiantly would
35-above
Figure 5.7 Age Group Have Idea and Either Bought Extended Warranty and They
Prefer To Apply For Extended Warranty
From our point of view the experience toward Malaysia market played a big role
in terms of age group, because high score was recorded for the much elder respondents.
As was mentioned earlier, the high result obtained for those with age above 35 years
clearly indicated that they had experience and have dealt with Malaysian industrial
market had more interest and prefer to apply for extended warranty when they intended
to buying vehicles.
In terms of gender group, by default the classification of gender group as Male
and Female shown in Figure 5.8 represents about 55.5% showing a high percent of
gender group that have idea about extended warranty, they would probably like and
prefer to apply for extended warranty when they intend to buy vehicles.
133
100
90
38
35
80
70
60
59
53
50
Prefer apply for ext
Count
40
definitely would not
30
probaby would not
20
might or not might
10
probably would
0
5
4
male
female
defiantly would
Figure 5.8 Gender Group Have Idea and Either Bought Extended Warranty and They
Prefer To Apply For Extended Warranty
Looking at the gender class (58.7%) which shows a high percent of those having
idea about extended warranty and they probably would like to apply for extended
warranty when they intend to buy vehicles was obtained by the female groups, while
53.1% by male groups.
From the result obtained, it can be seen that the female groups are more
interested to apply for extended warranty when they intend to buy vehicles, this maybe
because female are more sensitive and more carful toward vehicles.
134
5.8
Consumers’ Attitude
We have compared between those that had idea about extended warranty and
those who have not applied for the service before. The tendency to apply for the
extended warranty when they intend to buy vehicle, and to explore if the Malaysian
consumers are interest in extended warranty service especially those that bought the
service before, and if the Malaysian consumers are risk taker or risk averse.
From the result obtained in terms of ethnic groups, it seems to us that a higher
number of Malaysian consumers from all ethnic groups’ perspective are interested in
applying for three years. We asked our respondents how much period they were
interested in applying for extended warranty when they intend to buy vehicle, and the
result as shown in Figure 5.9 indicated 40% were interested in applying for three years.
This was followed by 28% that were interested in applying for more than four years,
and about 15% were interested in applying for four years. The least score was 8.3% that
were interested in applying for one year as well as those that were interested in applying
for two years. It also interests us to find out which of the Malaysian ethics group were
much more risk takers and risk averse.
We found out that, most of the Indian consumers were much interested to apply
for three years represented in 50%, and about 30% were interested in applying for four
years. 20% were interested in applying for more than four years, and none was interest
in applying for one year as well as two years. It seems to us, a clear picture from the
result obtained that the Indian consumers were risk averse and they scored a very good
rate of interest towards automobile extended warranty service.
For the Chinese consumers, it was found that a large number of Chinese
consumers were interested in applying for three years as represented by 42.1%, as well
as 42.1% interested in applying for more than four years. Also 10.5% were interested in
applying for four years, followed by 5.3% that were interested in applying for only one
year. No one from the Chinese respondents was interested in applying for two years.
135
100
23
42
20
90
80
30
13
70
60
35
11
If you interest to b
50
42
50
more than 4 years
40
4 years
30
16
3 years
Count
20
10
2 years
13
5
0
Malay
chinese
1 year
india
Figure 5.9: Ethnic Group with Idea about Extended Warranty and They Haven’t Applied For the
Service before and Much Interest to Apply For the Extended Warranty
The result from the Chinese respondents in terms of interest shows that they
prefer the extended warranty. The large score was obtained from those that had interest
in applying for three years and more than four years, which means that the Chinese
consumers were risk averse and were more interested towards extended warranty.
There was no difference between the Malay, Indian and Chinese consumers in
terms of interest, each of them showed a high score for three years. About 35% of the
Malay was interested in applying for three years, 22.6% are interested in applying for
more than four years and about 10.1% were interested in applying for two years, and
12.9% were interested in applying for one year as well as 0.1% in four years.
From the total result of all ethnic groups, it can seen that the interest of
Malaysian consumers ware limited between three years and more than four years for
extended warranty service when they intend to buy vehicles, which means all Malaysian
consumers whether Malays, Chinese or Indian were risk averse and they had much
interest toward automobile extended warranty service.
136
In terms of income groups, we have classified the income group as mentioned
earlier into four classes, beginning with under 1000RM, 1000RM-3000RM, 3000RM5000, and finally above 5000RM. The result obtained is shown in Figure 5.10 which
indicate that all the income group had idea about extended warranty and they haven’t
bought extended warranty before they agreed and most interest to apply for three years
when the intended to buy vehicles.
100
25
32
14
90
29
80
70
6
44
16
60
If you interest to b
43
50
38
more than 4 years
40
4 years
Count
30
20
13
10
13
3 years
5
14
8
0
under 1000RM
2 years
1 year
3000RM-5000RM
1000Rm-3000Rm
Figure 5.10 Income Group Have Idea about Extended Warranty And They Haven’t Applied For the
Service before and Much Interest to Apply For the Extended Warranty
Respondents those whom income under 1000RM and have idea about extended
warranty but they haven’t bought the service before have scored high percentage
represented in 40% and they are much interest to apply for extended warranty, 43.8% of
respondents those them income under 1000RM they indicated that they interest to apply
for three years and this represented the high percentage, while those them income
between 3000RM-5000RM they are most interest in three years also, about 42.9% they
indicated for that and 37.8% from respondents them income between 1000RM-3000RM
also indicated that they are much interest in three years.
137
From the result that we have got, we can see all the result of income group are
quite similar, but as mentioned earlier the higher score has been scored by those them
monthly income under 1000RM, from this result we can say the respondents those them
income under 1000RM are much risk averse and this maybe because them monthly
income not enough to repair them vehicles in case the vehicles break down or get
damage in the future.
In terms of age group we have classified into three classes as we mention earlier,
from 18-25 years was first class, then from 25-35 years was the second class and finally
above 35 years was the last class, and the result that we have obtained as shown in
Figure 5.11 shown for us the high percentage of age group have idea about extended
warranty and they haven’t bought extended warranty before are interest to buy extended
warranty for three years, about 40% they indicated for that.
100
26
29
33
90
80
70
9
60
35
21
11
44
50
43
more than 4 years
40
30
4 years
17
3 years
Count
20
10
If you interest to b
2 years
13
11
1 year
0
18-25
25-35
35-above
Figure 5.11: Age Groups Have Idea about Extended Warranty and They Haven’t Applied For the
Service before and Much Interest to Apply For the Extended Warranty
When we go in deep in age group classes, we can see the high percentage of age
group those have idea about extended warranty, and haven’t apply for extended
warranty, at the same time they are much interest in terms of the number of years of
extended warranty that they interest to buy represented in 44.4%, this result has been
138
scored by those them age has been classified above 35 years, followed by those them
age between 25-35 years old, about 42.9% they are much interest in three years of
extended warranty when they intended to buy vehicles, while about 34.8% of those
them age between 18-25 they interest also in three years of extended warranty.
From the result that we have obtained, we can see the interesting in extended
warranty from the age groups are come in sequential started in those them age above 35,
to those them age between 25-35 years old, from our point of view we can say those
them age above 35 years are much interest in extended warranty and in the same time
are risk averse because they are much care about the vehicles and they are not like to
take the risk of break down of the vehicles.
In terms of gender group, by default the classification if gender group classified
into two classes, Male and Female, as shown in Figure 5.12 40% from gender group
those have idea about extended warranty, at the same time they haven’t bought the
service of extended warranty before, they are much interest to buy three years extended
warranty when they are intend to buy vehicle.
But when we go in details, we can see the female groups are much interesting in
three years of extended warranty (34.6%) as well as interesting in more than five years
(34.6%), while male group indicated about 44.1% for three years and 23.5% for more
than five years.
From this result, it’s seems for us that female are much risk taker than male, this
result also has supported by several previous studies, many studies suggest that women
may behave differently from men in economic situations, several themes run through
the literature, one concerning male versus female attitudes toward risk. Evidence that
women invest more conservatively than men is interpreted by some to imply that
women are more averse to risk.
139
100
24
35
90
80
18
70
12
60
44
35
50
If you interest to b
40
more than 4 years
30
4 years
3 years
20
Count
12
2 years
6
10
9
8
male
female
0
1 year
Figure 5.12 Gender Group Have Idea about Extended Warranty And They Haven’t Applied For The
Service Before And Much Interest To Apply For The Extended Warranty
5.9
Consumers Impression
In this comparison, we have compared between those who bought extended
warranty for their vehicles, and their impression about extended warranty is that it gives
them peace of mind. The question of peace of mind has been classified in five classes,
started from Extremely Yes, Yes, Not Sure, No, and finally Definitely No. The result
that was obtained as shown in Figure 5.13 shows that high percentage of consumers
indicated Yes that extended warranty will give them peace of mind, as represented in
60%. When it turned to ethnics’ classification, the percentage of Malay consumers who
said Yes to extended warranty giving them peace of mind, is consider as a high
percentage, about 61.5% , followed by 30.8% who are not sure whether extended
140
warranty can give them peace of mind or not. Only 7.7% said extremely extended
warranty can give them peace of mind, while equilibrium occurred between Chinese
ethnics group, 50% said extended warranty extremely give them peace of mind as well
as 50% said Yes that extended warranty can give them peace of mind.
100
31
50
90
80
70
62
60
50
50
40
Do you think buying
Count
30
20
not sure
10
yes
0
8
Malay
Extremely yes
chinese
Figure 5.13: Ethnic Group That Bought Extended Warranty with Vehicle and Extended
Warranty Can Gives Them Peace of Mind
From the result obtained, it seems for us that extended warranty can play
effective role in terms of giving the Malaysian consumers peace of mind.
In terms of income groups, the classification of income groups has been
mentioned earlier, and the result that we have obtained as shown in Figure 5.14 after the
analysis represented that the higher group those extended warranty can gives them
peace of mind those them monthly income above 5000RM, about 100% indicated for
that and this also we can say because this group may have much frictional with the
market.
141
100
25
29
25
100
90
80
70
75
50
57
60
50
40
Do you think buying
30
Count
not sure
25
20
yes
14
10
0
Extremely yes
under 1000RM
3000RM-5000RM
1000Rm-3000Rm
above 5000RM
Figure 5.14: Income Group That Bought Extended Warranty with Vehicle and
Extended Warranty Can Gives Them Peace of Mind
And in terms of age group, also age group classification has been mentioned
earlier and the result as shown in Figure 5.15 indicated for us that elder group are said
Yes extended warranty can give them peace of mind, about 83.3% of those them age
above 35 years indicated that extended warranty can gives them peace of mind and this
is the higher percentage. This may be the elder consumer have much experience in the
automobile market witch is drives them to believe that extended warranty can give them
peace of mind.
142
100
33
43
83
90
80
70
67
60
43
50
40
Do you think buying
30
not sure
Count
20
14
10
17
yes
Extremely yes
0
18-25
25-35
35-above
Figure 5.15: Age Group That Bought Extended Warranty with Vehicle and Extended
Warranty Can Gives Them Peace of Mind
From gender point of view, both male and female believe that extended warranty
can gives them peace of mind and both of them scored the same percentage as shown in
Figure 5.16, about 62.5% of male indicated that Yes extended warranty can gives them
peace of mind, as well as 62.5% of female indicated that Yes extended warranty can
gives them peace of mind
143
100
13
38
90
63
80
70
60
63
50
40
Do you think buying
30
Count
not sure
25
20
yes
10
0
Extremely yes
male
female
Figure 5.16: Gender Group That Bought Extended Warranty with Vehicle and
Extended Warranty Can Gives Them Peace of Mind
5.10
Constraints
We have seen the extended warranty policy in Malaysian automobile industry is
not widespread. It has taken our interest to investigate what are the obstacles that
prevent extended warranty to be in widespread. And for that reasons, we compared
between those who applied extended warranty service for their vehicles with their
impression about the cost of the service. The result obtained as shown in Figure 5.17
shows that high percentage of consumers complained about the cost. About 33.3% said
that the cost is barely accept and this is considered a high percentage, and at the same
time most of our respondents who applied for the services for their vehicles have
monthly income between RM1000 to 3000.
144
100
90
8
100
23
80
70
23
60
What is You Impressi
50
very expensive price
23
40
expensive price
30
barely accept the pr
Count
20
23
ice
cheap price
10
0
very cheap price
Malay
chinese
Figure 5.17: People How Have Bought Extended Warranty with Vehicle and the
Impression about the Cost
Then we compared also those who applied extended warranty services for
vehicles and inquired from where they know about the extended warranty service. It
was found that the majority represented in 66.7% got the idea about the services of
extended warranty directly from the sales persons as shown in Figure 5.18.
145
100
15
50
90
8
80
69
70
60
50
50
Count
40
where extended warra
30
other
20
ads/promotion
salesperson
10
8
0
Malay
f riend
chinese
Figure 5.18: People Who Have Bought Extended Warranty With Vehicle and From
Where Know About Extended Warranty
From here we can extract the cost and lake of advertisements can be the main
factors of non-widespread of extended warranty service in Malaysian automobile
industry.
5.11
Chapter Summary
In this chapter we have discussed in broad terms and covered the result of data
analysis of the questionnaire instrumental and all the comparison of our variables that
should answer our research questions. The distribution of choices based on ethnicity
was analyzed. Finally, the impression of consumers was looked into followed by the
constraints to warrantee service extension.
CHAPTER 6
CONCLUSION
In this study, our goal is to examine the Malaysian consumers’ perception
towards the extended warranty policy; we have taken Automobile industrial market as
case study. From our believe Malaysia’s development in terms of industry, is from the
automobile market which represents a high marketing level. From that perception, we
believe that we can obtain a high investigation records in terms of scale of consumers
perception.
In this paper we have taken a survey as a methodology for conducting the data
collection. In particular, we have designed questionnaire instrumental to guide our
investigation to optimize for us the required information from the Malaysian consumers,
and SPSS software was used to help us in analyzing the data collection.
People in metropolitan area represented in Johor Bahru City in Malaysia become
our target to gain response in research investigation and we have distributed about 150
samples of the questionnaire, and our selection has been made randomly for the
respondents. The study concentrated on the people who have vehicle such as Car and
147
Motorbike from different ages and ethics (Malay, Chinese and Indian) to evaluate
consumers perception and obtain results according to the research objectives.
The questionnaire instrument comprised of three major parts, in each part was
designed to answer a particular question in the research questions. In part one we have
explored the knowledge of consumers toward the extended warranty and tried to figure
out whether the Malaysian consumers have idea about this new policy or not. In part
two, we designed it to measure the percentage of consumers in particular who have
vehicle and whether if they deal and purchase extended warranty with their vehicle
before or not. Also investigated was if the consumers are familiar with this new policy.
In part three we have tried to explore if the consumers welcome this new policy in
automobile marketing or not, their believe and trust of consumers towards the extended
warranty policy in terms of automobile marketing.
One of objectives of this research is to review extended warranty policy in
Malaysian automobile industry. In other words, the extent of extended warranty in
Malaysian automobile industry, and the result that was obtained from the investigation
revealed that the percentage of consumers who have dealt with extended warranty
policy in Malaysian automobile industry in Malaysia is very few, and during our
investigation we found that one of the reasons is the cost of the service. Most of the
respondents who have applied for the service when they bought vehicles said they
barely accept the cost of the extended warranty and moreover the high percentage of
those have a monthly income considered as high income, approximately between
RM1000 to RM3000 per month, and the second reason is the pool of advertisement for
the extended warranty service. Because during our investigation, we found most of
those who bought extended warranty know about extended warranty through
salespersons directly. This reason also can be one of the factors of scanty proliferation
of extended warranty service.
.
So, from the result we have got, it seems that the obstacle to the process of
proliferation of extended warranty in Malaysia automobile industry is the cost of the
service offered from manufacturer to consumers and the lack of advertisement.
148
The second objective of our research it is to explore the degree of knowledge
and attitude of Malaysian consumers towards extended warranty policy. From the result
obtained after conducting questionnaire analysis, about 74% of our respondents
indicated that they have idea about extended warranty, further investigation about the
degree of knowledge of consumers toward extended warranty, a three-option choice
question was included in the questionnaire and the choices contained the right
definition, wrong definition and the last option stated that the respondent does not
know. The percentage of those who have idea about extended warranty and they know
the right definition was very high represented in 88.9% , which means the majority of
consumers have very good knowledge about extended warranty.
And for more investigation on consumers’ attitude, we compared between those
who have idea about extended warranty and they haven’t applied for the service before,
at the same time they are much interested to apply for the extended warranty when they
intend to buy vehicle, to explore whether the Malaysian consumers are interest in
extended warranty service especially those whom bought the service before. Also
investigated is whether the Malaysian consumers are risk taker or risk averse.
From the result that we have got, it was found that higher numbers of Malaysian
consumers from all ethnic group perspective are interest in applying for three years. We
have asked our respondents how much period they may wish to apply for extended
warranty when they intend to buy vehicle, and the result revealed that 40% are
interested to apply for three years, followed by 28% for more than four years, also about
15% for four years, and the lowest scored is 8.3% which represent those interested in
applying for one years as well as those who are interested in applying for two years.
From the total result, we have seen that the interest of Malaysian consumers is
limited between three years and more than four years of extended warranty service
when they intend to buy vehicles, which mean all Malaysian consumers whether if
Malays, Chinese or Indian are risk averse as they are much interested in automobile
extended warranty service.
149
The third objective of this research is to investigate the impact of providing
extended warranty policy in Malaysian automobile industry to local consumer, and for
achieving this objective we have compared between those who bought extended
warranty for their vehicles, and their impression about extended warranty as a source of
peace of mind. The question of peace of mind has been classified in five classes,
starting from Extremely Yes, Yes, Not Sure, No, and finally Definitely No, the result
that was obtained revealed that the higher percentage of consumers represented in 60%
indicated Yes that extended warranty can give them peace of mind. And it seems for us
it is a positive result and there is impact upon consumers by providing extended
warranty in the market.
By utilizing from the result of this research, further research can be done in the
area of extended warranty for Malaysian automobile industry,
to investigate factors
that prevent extended warranty to become widespread in Malaysian automobile
industry, we can then perform a further examination of the identifier factors.
We can also extend this research by examining the perception of extended
warranty from manufacturer perception. A slightly different result may be gained,
comparisons can then be made to see the differences of perceptions between the
manufacturer and consumers.
Also further research can be apply to study the discrepancy of Malaysian
consumer attitudes and behavioral from deferent ethnic perspective in Malaysia market.
150
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APPENDIX A
GAUNT CHART
APPENDIX B
NETWORK DIAGRAM
APPENDIX C
QUESTIONNAIRE INSTRUMENT
Questionnaire letter of Extended Warranty
Borang kaji selidik tentang surat penambahan masa jaminan
This questionnaire has been designed to help us to investigate consumer’s perception research
study toward the extended warranty concept
The different between Warranty and Extended Warranty is: Extended Warranty is that the latter is
entered into voluntarily and is purchased separately – the buyer may even have a choice of terms,
whereas a warranty is part of product purchase and integral to the sale. Therefore one of our objectives
it’s to explore the degree of knowledge and attitude of Malaysian consumers toward the extended
warranty by design this questionnaire instrumental.
Borang kaji selidik ini telah direka untuk menyelidik persepsi pelanggan kajian pembelajaran terhadap konsep
penambahan masa jaminan.
Perbezaan diantara Jaminan dan Penambahan masa jaminan ialah surat yang telah dimasukkan secara
sukarela dan pembelian secara berasingan – pembeli dapat membuat pilihan terma-terma, sedangkan sebuah
jaminan ialah bahagian pembelian barang dan utuh untuk dijual. Oleh sebab itu salah satu tujuan kita untuk
meneroka tingkat pengetahuan dan perangai pelanggan Malaysia terhadap penambahan masa jaminan dengan
membuat alat borang kaji selidik ini.
AMRO OSMAN WIDAA
Master Of computer Science & Information System (In Major of IT-Manufacturing)
From here I would like to thanks every one who participate and contribute in this research, your contribution is
highly appreciated by the researchers
Disini saya ingin mengucapkan terima kasih kepada sesiapa saja yang telah memberikan kerjasama dan sumbangan dalam kajian ini,
sumbangan anda ialah sangat dihargai oleh pengkaji
129
Information section (Bahagian Informasi):
Tick in the square for your chosen answer (Tandakan petak yang bersesuaian dengan jawapan anda):
You are (Anda):
male (lelaki)
Your age between (Umur):
female (perempuan)
18-25
25-35
Your ethnic (Kaum): Malay (Melayu)
Do you have vehicle?
Apakah anda mempunyai kendaraan?
What type of vehicle you have?
35-above (keatas)
Chinese (Cina)
YES (YA)
Car (Kereta)
Indian (India)
NO (TIDAK)
Motorbike (Motorsikal)
Kendaraan apakah yang anda punya ?
Occupation (Pekerjaan):
Private Business
private company
Perniagaan swasta
Syarikat persendirian
other (lain-lain)
Employee
Pekerja
Government staff
Student
Other
Pegawai kerajaan
Pelajar
Lain-lain
Which group describes your monthly income?
Kelompok manakah yang termasuk pendapatan bulanan anda?
-Under (Dibawah) 1000RM
-1000RM - 3000RM
-3000RM - 5000RM
- Above (Diatas) 5000RM
130
other (Lain-lain)
Part One (Bahagian Satu):
A.1 / Do you have idea about what is the warranty?
Apakah anda mempunyai pendapat tentang apa itu jaminan?
Yes (YA)
NO (TIDAK)
A.2 / Have you bought product with warranty before?
Apakah anda pernah membeli barang dengan jaminan sebelum ini?
Yes (YA)
NO (TIDAK)
A.3 / Do you have idea about what is the extended warranty?
Apakah anda mempunyai pendapat tentang penambahan masa jaminan?
Yes (YA)
NO (TIDAK)
A.4 / Have you bought product with extended warranty before?
Apakah anda pernah membeli barang dengan penambahan masa jaminan sebelum ini?
Yes (YA)
NO (TIDAK)
A.5 / Where did you know about extended warranty?
Dari mana anda tahu tentang penambahan masa jaminan?
Friend/relative (Kawan/kerabat)
Salesperson
(Penjual)
Ads/promotions (Pentadbiran/promosi)
Via the internet/website (Melalui internet/website)
Other
(Lain-lain)
131
A.6 / Base on your idea, which of these defini ons describe for you the right defini on of extended warraty?
Berdasarkan pada pendapat anda, definisi manakah yang menyatakan kepada anda definisi yang tepat tentang penambahan masa jaminan?
An Extended Warranty is prolonged warranty offered by manufacturer or retailer to consumers; this
warranty extends the period of the manufacturer’s standard warranty and is optional.
Penambahan masa jaminan ialah penambahan masa jaminan yang ditawarkan oleh kilang atau pedagang kepada pelangganpelanggan; jaminan ini menambah jangka masa standard jaminan kilang dan ia adalah pilihan.
An Extended Warranty is prolonged warranty requested by consumers from manufacturers or retailers;
this warranty extends the period of the manufacturer’s standard warranty.
Penambahan masa jaminan ialah penambahan masa jaminan yang diminta oleh pelanggan-pelanggan dari kilang-kilang atau
pedagang-pedagang; jaminan ini menambah jangka masa standard jaminan kilang.
I don’t know (Saya tidak tahu)
Part Two (Bahagian Dua)
B.1 / Have you bought vehicle with extended warranty before?
Pernahkah anda membeli kendaraan dengan penambahan masa jaminan sebelum ini?
NO (TIDAK)
Yes (YA)
if yes answer the next questions please
jika ya, sila jawab soalan selanjutnya
B.2 / How many years your extended warranty you bought should cover?
Berapa tahunkah penambahan masa jaminan yang anda beli sepatutnya berbaloi?
o
Extra one year (Lebih satu tahun)
o
Extra two years (Lebih dari dua tahun)
o
Extra three years (Lebih dari tiga tahun)
o
Extra four years
o
More than extra five years (Lebih dari lima tahun)
(Lebih dari empat tahun)
132
B.3 / How long you bought your extended warranty with your vehicle?
Berapa lamakah anda membeli penambahan masa jaminan dengan kendaraan anda?
o
Recently I bough (Baru saja saya beli)
o
Less than one year (Kurang dari setahun)
o
Less than two years (Kurang dari dua tahun)
o
Less than three years (Kurang dari tiga tahun)
o
More than three years (Lebih dari tiga tahun)
B.4 / And have you used your extended warranty services since you got the extended warranty?
Dan pernahkah anda menggunakan khidmat penambahan masa jaminan semenjak anda mendapatkan penambahan masa jaminan tersebut?
NO (TIDAK)
Yes
(YA)
if yes how many times you used please?
Jika ya, berapa kali anda menggunakannya
o
One time (Sekali)
o
Two times (Dua kali)
o
Three times (Tiga kali)
o
Four times (Empat kali)
o
More than five times (Lebih dari tiga tahun)
B.5 / When you bought the vehicle, did you buy an extended warranty at the same me?
Ketika anda membeli kendaraan, Apakah anda membeli penambahan masa jaminan dalam masa yang sama?
Yes
(YA)
No (TIDAK)
133
B.6 / When you bought extended warranty, for sure you add some extra value amounts for your warranty. In
your opinion, what is your impression about the cost value that you paid to add extended warranty service?
Ketika anda telah membeli penambahan masa jaminan, tentu saja anda menambah bayaran tambahan untuk jaminan anda. pada pendapat
anda, apakah kesan anda tentang nilai kos yang anda telah bayar untuk menambah khidmat penambahan masa jaminan?
o
Very cheap price (Harga sangat murah)
o
Cheap price (Harga murah)
o
Barely acceptable the price (Hampir tidak berbaloi)
o
Expensive price (Harga mahal)
o
Very expensive price (Harga sangat mahal)
B.7 / What propose you bought extended warranty?
Apakah tujuan anda membeli penambahan masa jaminan?
1. Reducing purchasing risk
Mengurangi risiko pembelian
2. Reducing repairing cost
Mengurangi kos perbaikan
3. Follow friend
Ikut kawan
4.
Self insurance
Jaminan diri
134
Part three (Bahagian Tiga):
C.1 / Your experience about the term of extended warranty is:
Pengalaman anda tentang penambahan masa jaminan ialah :
Very strong
experience
Very good
Good
Not bad
Very bad
Sangat baik
Baik
Tidak buruk
Sangat buruk
2
3
4
5
Pengalaman yang kuat
1
C.2 / Do you prefer to apply for extended warranty when you are buying a vehicle?
Apakah anda lebih suka memohon untuk penambahan masa jaminan ketika anda membeli kendaraan?
definitely would not
Defiantly would
probably would
might be
probably would not
Tidak Akan
Mungkin Akan
Mungkin/Tidak Mungkin
Mungkin Tidak Akan
Pasti Tidak Akan
1
2
3
4
5
Recommended
Not recommended
Mencadangkan
Tidak mencadangkan
Definitely not
recommended
C.3 / Your recommendation of buying a vehicle with extended warranty is:
Cadangan anda tentang pembayaran sebuah kendaraan dengan penambahan masa jaminan ialah
Very strongly
recommended
Strongly
recommended
Sangat kuat
mencadangkan
Kuat mencadangkan
1
2
Sangat tidak
mencadangkan
3
135
4
5
C.4 / If you interest to buy an extended warranty with your vehicle, how many years of extended warranty
would you like to buy?
Jika anda berminat untuk membeli penambahan masa jaminan dengan kendaraan anda, berapa lamakah penambahan masa jaminan yang
anda suka untuk dibeli?
:
1 year
2 years
3 years
4 years
More than 4 years
1 tahun
2 tahun
3 tahun
4 tahun
Lebih dari 4 tahun
1
2
3
4
5
C.5 / Do think buying extended warranty can give you a peace of mind?
Apakah anda fakir dengan membeli penambahan masa jaminan dapat memberikan anda ketenangan fikiran?
Extremely yes
Yes
Not Sure
Tidak yakin
Tidak
Tidak sama sekali
1
2
3
4
5
Sangat setuju
Ya
136
No
Definitely No
APPENDIX D
QUESTIONNAIRE DISRUPTING TRACKING
Tracking Of Questionnaire Distribution
Date
Area of Dist
No of
Samples
136
Date of receive
Commends
APPENDIX E
LETTER OF DISTRIBUTION QUESTIONNAIRE
138
APPENDIX F
DATA ANALYSIS USING SPSS SOFTWARE
F.1 / gender
Valid
male
female
Total
Frequency
75
75
150
Percent
50.0
50.0
100.0
Valid Percent
50.0
50.0
100.0
Cumulative
Percent
50.0
100.0
F.2 / Age
Valid
18-25
25-35
35above
Total
Frequency
Percent
Valid Percent
Cumulative
Percent
55
66
36.7
44.0
36.7
44.0
36.7
80.7
29
19.3
19.3
100.0
150
100.0
100.0
F.3 / Ethnic
Valid
Malay
chinese
india
Total
Frequency
88
43
Percent
58.7
28.7
Valid Percent
58.7
28.7
19
150
12.7
100.0
12.7
100.0
Cumulative
Percent
58.7
87.3
100.0
F.4/ Vehicle
Valid
yes
Frequency
Percent
Valid Percent
Cumulative
Percent
150
100.0
100.0
100.0
F.5/ Vehicle Type
Valid
car
motorbik
e
other
Total
Frequency
110
Percent
73.3
Valid Percent
73.3
Cumulative
Percent
73.3
39
26.0
26.0
99.3
100.0
1
.7
.7
150
100.0
100.0
140
F.6 / Occupation
Frequency
Valid
private
business
private
company
employe
government
staff
student
other
Total
Percent
Valid Percent
Cumulative
Percent
29
19.3
19.3
19.3
3
2.0
2.0
21.3
24
16.0
16.0
37.3
40
26.7
26.7
64.0
53
1
35.3
.7
35.3
.7
99.3
100.0
150
100.0
100.0
F.7 / Income
Frequency
Valid
under
1000RM
1000Rm3000Rm
3000RM5000RM
above
5000RM
Total
Percent
Valid Percent
Cumulative
Percent
50
33.3
33.3
33.3
74
49.3
49.3
82.7
24
16.0
16.0
98.7
2
1.3
1.3
100.0
150
100.0
100.0
F.8 / Idea Warranty
Valid
yes
no
Total
Frequency
148
2
Percent
98.7
1.3
Valid Percent
98.7
1.3
150
100.0
100.0
141
Cumulative
Percent
98.7
100.0
F.9 / Bought Product
Valid
yes
no
Total
Frequency
146
4
150
Percent
97.3
2.7
100.0
Valid Percent
97.3
2.7
100.0
Frequency
111
Percent
74.0
Valid Percent
74.0
39
150
26.0
100.0
26.0
100.0
Frequency
52
96
1
Percent
34.7
64.0
.7
Valid Percent
34.7
64.0
.7
1
150
.7
100.0
.7
100.0
Cumulative
Percent
97.3
100.0
F.10 / Extended Warranty
Valid
yes
no
Total
Cumulative
Percent
74.0
100.0
F.11/ Bought Extended Warranty
Valid
yes
no
3
5
Total
Cumulative
Percent
34.7
98.7
99.3
100.0
F.12./ Where extended warranty
Frequency
Valid
friend
salesperson
ads/promotion
via the
internet/website
other
Missing
Total
Total
System
Percent
Valid Percent
Cumulative
Percent
25
47
28
16.7
31.3
18.7
18.7
35.1
20.9
18.7
53.7
74.6
10
6.7
7.5
82.1
24
134
16.0
89.3
17.9
100.0
100.0
16
150
10.7
100.0
142
F.13/ Definition warranty
Frequency
Valid
offered by
Manufacturer
requested by
consumer
I din’t know
Total
Percent
Valid Percent
Cumulative
Percent
81
54.0
54.0
54.0
32
21.3
21.3
75.3
37
150
24.7
100.0
24.7
100.0
100.0
F.14/ Bought with Extended Warranty
Valid
yes
no
3
Frequency
16
133
Percent
10.7
88.7
Valid Percent
10.7
88.7
1
150
.7
100.0
.7
100.0
Total
Cumulative
Percent
10.7
99.3
100.0
F.15 / How Many Years
Valid
Extra one year
Extra two years
Extra 3 years
more than extra
5 years
Total
Missing
Total
System
Frequency
3
7
Percent
2.0
4.7
Valid Percent
20.0
46.7
Cumulative
Percent
20.0
66.7
2
1.3
13.3
80.0
3
2.0
20.0
100.0
15
10.0
100.0
135
150
90.0
100.0
143
F.16/ How long your Extended warranty
Frequency
Valid
Missing
recently i
bought
less than one
year
less than tow
years
less than 3
years
more than 3
years
Total
System
Total
Percent
Valid Percent
Cumulative
Percent
4
2.7
26.7
26.7
6
4.0
40.0
66.7
1
.7
6.7
73.3
1
.7
6.7
80.0
3
2.0
20.0
100.0
15
135
10.0
90.0
100.0
150
100.0
F.17/ Used Extended Wrranty service
Valid
Missing
Total
yes
no
Total
System
Frequency
11
Percent
7.3
Valid Percent
50.0
11
22
7.3
14.7
50.0
100.0
128
150
85.3
100.0
Cumulative
Percent
50.0
100.0
F.18 /If Used Service
Valid
one time
two times
three times
more than 5
times
Total
Missing
Total
System
Frequency
4
5
Percent
2.7
3.3
Valid Percent
33.3
41.7
Cumulative
Percent
33.3
75.0
2
1.3
16.7
91.7
1
.7
8.3
100.0
12
138
8.0
92.0
100.0
150
100.0
144
F.19 / Did you buy an Extended Warranty at same time
Valid
Missing
yes
no
Total
System
Frequency
7
17
24
Percent
4.7
11.3
16.0
126
150
84.0
100.0
Total
Valid Percent
29.2
70.8
100.0
Cumulative
Percent
29.2
100.0
F.20 / What is You Impression about the cost value that you paid
Valid
very cheap price
cheap price
barely accept
the price
expensive price
very expensive
price
Total
Missing
Total
Frequency
3
3
Percent
2.0
2.0
Valid Percent
21.4
21.4
Cumulative
Percent
21.4
42.9
5
3.3
35.7
78.6
2
1.3
14.3
92.9
1
.7
7.1
100.0
14
136
9.3
90.7
100.0
150
100.0
System
F.21 / What proposed you bought extended warranty
Frequency
Valid
Missing
Total
reducing
purchasing risk
reducing repairing
cost
self insurance
Total
System
Percent
Valid Percent
Cumulative
Percent
13
8.7
29.5
29.5
20
13.3
45.5
75.0
100.0
11
7.3
25.0
44
106
29.3
70.7
100.0
150
100.0
145
F.22 / Experience about extended wrranty
Frequency
Valid
very strong
Experince
very good
good
not bad
very bad
Total
Percent
Valid Percent
Cumulative
Percent
1
.7
.7
.7
19
48
12.7
32.0
12.7
32.0
13.3
45.3
51
31
34.0
20.7
34.0
20.7
79.3
100.0
150
100.0
100.0
F.23 / Prefer apply for extended warranty when you buying vehicle
Frequency
Valid
defiantly
would
probably
would
might or not
might
probaby
would not
definitely
would not
Total
Percent
Valid Percent
Cumulative
Percent
7
4.7
4.7
4.7
77
51.3
51.3
56.0
61
40.7
40.7
96.7
4
2.7
2.7
99.3
1
.7
.7
100.0
150
100.0
100.0
F.24 / your recommendation of paying a vehicle with extend warranty
Frequency
Valid
very strong
recommend
strong
recommend
recommend
not recommend
Total
Percent
Valid Percent
Cumulative
Percent
4
2.7
2.7
2.7
30
20.0
20.0
22.7
106
10
70.7
6.7
70.7
6.7
93.3
100.0
150
100.0
100.0
146
F.25 / If you interest to buy an extended warranty with your vehicle, how many extended warranty period you
like to buy
Valid
1 year
2 years
3 years
4 years
more than 4
years
Total
Frequency
10
Percent
6.7
Valid Percent
6.7
Cumulative
Percent
6.7
18
54
12.0
36.0
12.0
36.0
18.7
54.7
28
18.7
18.7
73.3
40
26.7
26.7
100.0
150
100.0
100.0
F.26 / Do you think buying extended warranty can give you peace of mind?
Frequency
Valid
Extremely
yes
yes
not sure
defiantly
no
Total
Percent
Valid Percent
Cumulative
Percent
6
4.0
4.0
4.0
82
54.7
54.7
58.7
59
39.3
39.3
98.0
3
2.0
2.0
100.0
150
100.0
100.0
F.27 / Case Processing Summary
Cases
Valid
N
Idea Warranty *
Definition warranty
Missing
Percent
150
N
100.0%
Percent
0
147
Total
.0%
N
Percent
150
100.0%
F.28 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
-.139
Asymp.
Std.
Error(a)
.115
Approx.
T(b)
-1.243
Approx. Sig.
.217(c)
-.176
.099
-1.590
.116(c)
N of Valid Cases
81
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
F.29 / etnic know the right difenetion * Extended Warranty Crosstabulation
Extended Warranty
yes
etnic know the
right difenetion
Malay
chinese
india
Total
Count
% within etnic
know the right
difenetion
Count
% within etnic
know the right
difenetion
Count
% within etnic
know the right
difenetion
Count
% within etnic
know the right
difenetion
no
Total
41
8
49
83.7%
16.3%
100.0%
26
0
26
100.0%
.0%
100.0%
5
1
6
83.3%
16.7%
100.0%
72
9
81
88.9%
11.1%
100.0%
F.30 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
4.787(a)
7.490
1.535
2
2
Asymp. Sig.
(2-sided)
.091
.024
1
.215
df
81
a 2 cells (33.3%) have expected count less than 5. The minimum expected count is .67.
148
F.31 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
-.139
Asymp.
Std.
Error(a)
.115
Approx.
T(b)
-1.243
Approx. Sig.
.217(c)
-.176
.099
-1.590
.116(c)
N of Valid Cases
81
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.32 / Case Processing Summary
Cases
Valid
N
ethnic have idea about
extended warranty *
Prefer apply for extended
warranty when you buying
vehicle
Missing
Percent
111
N
74.0%
Percent
39
149
Total
26.0%
N
Percent
150
100.0%
F.33 / ethnic have idea about extended warranty * Prefer apply for extended warranty when you buying
vehicle Crosstabulation
all ethnic have
ext_idea and
either they
bought or not
Malay
Count
% within all
ethnic have
ext_idea and
either they
bought or not
Chinese
Indian
Count
% within all
ethnic have
ext_idea and
either they
bought or not
Count
% within all
ethnic have
ext_idea and
either they
bought or not
Total
Count
% within all
ethnic have
ext_idea and
either they
bought or not
Prefer apply for extended warranty when you buying
vehicle
probably
defiantly probably
might or
would
definitely
would
would
not might
not
would not
3
35
17
1
1
5.3%
61.4%
29.8%
1.8%
1.8%
100.0%
1
22
15
2
0
40
2.5%
55.0%
37.5%
5.0%
.0%
100.0%
1
4
8
0
0
13
7.7%
30.8%
61.5%
.0%
.0%
100.0%
5
61
40
3
1
110
4.5%
55.5%
36.4%
2.7%
.9%
100.0%
F.34 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
7.330(a)
7.881
1.176
8
8
Asymp. Sig.
(2-sided)
.501
.445
1
.278
df
111
a 10 cells (66.7%) have expected count less than 5. The minimum expected count is .12.
F.35 / Symmetric Measures
Interval by Interval
Pearson's R
Ordinal by Ordinal
Spearman
Correlation
N of Valid Cases
Total
57
Value
.103
Asymp.
Std.
Error(a)
.096
Approx.
T(b)
1.085
Approx. Sig.
.280(c)
.138
.096
1.453
.149(c)
111
150
Cross-tab
F.36 / Case Processing Summary
Cases
Valid
N
all ethnic have idea
about extended and did
not bought before * If
you interest to buy an
extended warranty with
your vehicle, how many
extended warranty
period you like to buy
Missing
Percent
60
N
40.0%
Total
Percent
90
N
60.0%
Percent
150
100.0%
F.37 / all ethnic have idea about extended and did not bought before * If you interest to buy an extended
warranty with your vehicle, how many extended warranty period you like to buy Crosstabulation
all ethnic have
idea about
extended and
did not bought
before
Malay
chinese
india
Total
Count
% within all
ethnic have
idea about
extended and
did not bought
before
Count
% within all
ethnic have
idea about
extended and
did not bought
before
Count
% within all
ethnic have
idea about
extended and
did not bought
before
Count
% within all
ethnic have
idea about
extended and
did not bought
before
If you interest to buy an extended warranty with
your vehicle, how many extended warranty
period you like to buy
more
than 4
1 year 2 years 3 years 4 years
years
4
5
11
4
7
Total
31
12.9%
16.1%
35.5%
12.9%
22.6%
100.0
%
1
0
8
2
8
19
5.3%
.0%
42.1%
10.5%
42.1%
100.0
%
0
0
5
3
2
10
.0%
.0%
50.0%
30.0%
20.0%
100.0
%
5
5
24
9
17
60
8.3%
8.3%
40.0%
15.0%
28.3%
100.0
%
151
F.38 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
10.655(a)
12.904
8
8
Asymp. Sig.
(2-sided)
.222
.115
1
.098
df
2.745
60
a 11 cells (73.3%) have expected count less than 5. The minimum expected count is .83.
F.39 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson’s R
Spearman
Correlation
Value
.216
Asymp.
Std.
Error(a)
.105
Approx.
T(b)
1.682
Approx. Sig.
.098©
.229
.116
1.788
.079©
N of Valid Cases
60
a Not assuming the null hypothesis.
B Using the asymptotic standard error assuming the null hypothesis.
C Based on normal approximation.
Cross-tab
F.40/ Case Processing Summary
Cases
Valid
N
etnic group bought
extended warranty with
vehicle * Do you think
buying extended
warranty can give you
peace of mind?
Missing
Percent
15
N
10.0%
152
Total
Percent
135
90.0%
N
Percent
150
100.0%
F.41 / etnic group bought extended warranty with vehicle * Do you think buying extended warranty can give
you peace of mind? Crosstabulation
Do you think buying extended warranty
can give you peace of mind?
etnic group
bought extended
warranty with
vehicle
Malay
chinese
Count
% within etnic
group bought
extended
warranty with
vehicle
Count
Extremely yes
1
% within etnic
group bought
extended
warranty with
vehicle
Count
% within etnic
group bought
extended
warranty with
vehicle
Total
yes
not sure
4
13
7.7%
61.5%
30.8%
100.0%
1
1
0
2
50.0%
50.0%
.0%
100.0%
2
9
4
15
13.3%
60.0%
26.7%
100.0%
F.42 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
2.981(a)
2.729
2
2
Asymp. Sig.
(2-sided)
.225
.256
1
.133
df
2.260
15
a 5 cells (83.3%) have expected count less than 5. The minimum expected count is .27.
F.43 / Symmetric Measures
Interval by Interval
Pearson's R
Ordinal by Ordinal
Spearman
Correlation
N of Valid Cases
Value
-.402
Asymp.
Std.
Error(a)
.211
Approx.
T(b)
-1.582
Approx. Sig.
.138(c)
-.389
.199
-1.522
.152(c)
15
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
153
Total
8
Cross-tab
F.44 / Case Processing Summary
Cases
Valid
N
etnic group bought
extended warranty with
vehicle * What is You
Impression about the
cost value that you paid
Missing
Percent
15
N
10.0%
Total
Percent
135
N
90.0%
Percent
150
100.0%
F.45 / ethnic group bought extended warranty with vehicle * What is You Impression about the cost value that
you paid Crosstabulation
What is You Impression about the cost value that you
paid
very
barely
very
cheap
cheap
accept the expensiv expensiv
price
price
price
e price
e price
etnic group
bought
extended
warranty with
vehicle
Malay
Count
chinese
% within
etnic group
bought
extended
warranty with
vehicle
Count
% within
etnic group
bought
extended
warranty with
vehicle
Count
Total
% within
etnic group
bought
extended
warranty with
vehicle
3
3
3
3
1
13
23.1%
23.1%
23.1%
23.1%
7.7%
100.0%
0
0
2
0
0
2
.0%
.0%
100.0%
.0%
.0%
100.0%
3
3
5
3
1
15
20.0%
20.0%
33.3%
20.0%
6.7%
100.0%
F.46 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Total
Value
4.615(a)
5.050
.110
4
4
Asymp. Sig.
(2-sided)
.329
.282
1
.740
df
15
a 10 cells (100.0%) have expected count less than 5. The minimum expected count is .13.
154
F.47 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson’s R
Spearman
Correlation
Value
.089
Asymp.
Std.
Error(a)
.106
Approx.
T(b)
.320
Approx. Sig.
.754©
.093
.148
.339
.740©
N of Valid Cases
15
a Not assuming the null hypothesis.
B Using the asymptotic standard error assuming the null hypothesis.
C Based on normal approximation.
Cross-tab
F.48 / Case Processing Summary
Cases
Valid
N
etnic group bought
extended warranty
with vehicle * Income
Missing
Percent
15
N
10.0%
Total
Percent
135
N
90.0%
Percent
150
100.0%
F.49 / etnic group bought extended warranty with vehicle * Income Crosstabulation
etnic group
bought
extended
warranty with
vehicle
Total
Malay
Count
chinese
% within etnic
group bought
extended
warranty with
vehicle
Count
under
1000RM
3
% within etnic
group bought
extended
warranty with
vehicle
Count
% within etnic
group bought
extended
warranty with
vehicle
155
Income
1000Rm 3000RM
3000Rm 5000RM
7
2
above
5000RM
1
Total
13
23.1%
53.8%
15.4%
7.7%
100.0%
0
0
2
0
2
.0%
.0%
100.0%
.0%
100.0%
3
7
4
1
15
20.0%
46.7%
26.7%
6.7%
100.0%
F.50 / Chi-Square Tests
Value
6.346(a)
6.235
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
3
3
Asymp. Sig.
(2-sided)
.096
.101
1
.159
df
1.988
15
a 7 cells (87.5%) have expected count less than 5. The minimum expected count is .13.
F.51 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
.377
Asymp.
Std.
Error(a)
.164
Approx.
T(b)
1.467
Approx. Sig.
.166(c)
.437
.165
1.750
.104(c)
N of Valid Cases
15
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.52 / Case Processing Summary
Cases
Valid
N
etnic group bought
extended warranty
with vehicle * where
extended warranty
Missing
Percent
15
10.0%
156
N
Total
Percent
135
90.0%
N
Percent
150
100.0%
F. 53 / etnic group bought extended warranty with vehicle * where extended warranty Crosstabulation
where extended warranty
salesperso
ads/pro
n
motion
friend
etnic group
bought
extended
warranty with
vehicle
Malay
Count
chinese
% within etnic
group bought
extended
warranty with
vehicle
Count
% within etnic
group bought
extended
warranty with
vehicle
Count
Total
% within etnic
group bought
extended
warranty with
vehicle
other
Total
1
9
1
2
13
7.7%
69.2%
7.7%
15.4%
100.0%
1
1
0
0
2
50.0%
50.0%
.0%
.0%
100.0%
2
10
1
2
15
13.3%
66.7%
6.7%
13.3%
100.0%
F.54 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
2.885(a)
2.506
3
3
Asymp. Sig.
(2-sided)
.410
.474
1
.281
df
1.160
15
a 7 cells (87.5%) have expected count less than 5. The minimum expected count is .13.
F.55 / Symmetric Measures
Interval by Interval
Pearson’s R
Ordinal by Ordinal
Spearman
Correlation
Value
-.288
Asymp.
Std.
Error(a)
.137
Approx.
T(b)
-1.084
Approx. Sig.
.298©
-.379
.215
-1.478
.163©
N of Valid Cases
15
a Not assuming the null hypothesis.
B Using the asymptotic standard error assuming the null hypothesis.
C Based on normal approximation.
157
Cross-tab
F.56 / Case Processing Summary
Cases
Valid
N
income know the
right definition *
Extended Warranty
Missing
Percent
81
N
54.0%
Total
Percent
69
N
46.0%
Percent
150
100.0%
F.57 / income know the right definition * Extended Warranty Crosstabulation
Extended Warranty
yes
income know the
right definition
under 1000RM
Count
1000Rm-3000Rm
% within income
know the right
definition
Count
3000RM-5000RM
% within income
know the right
definition
Count
above 5000RM
% within income
know the right
definition
Count
% within income
know the right
definition
Count
Total
% within income
know the right
definition
no
Total
18
6
24
75.0%
25.0%
100.0%
38
3
41
92.7%
7.3%
100.0%
15
0
15
100.0%
.0%
100.0%
1
0
1
100.0%
.0%
100.0%
72
9
81
88.9%
11.1%
100.0%
F.58 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
7.285(a)
8.054
6.433
3
3
Asymp. Sig.
(2-sided)
.063
.045
1
.011
df
81
a 5 cells (62.5%) have expected count less than 5. The minimum expected count is .11.
158
F.59 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson’s R
Spearman
Correlation
Value
-.284
Asymp.
Std.
Error(a)
.083
Approx.
T(b)
-2.628
Approx. Sig.
.010©
-.292
.089
-2.712
.008©
N of Valid Cases
81
a Not assuming the null hypothesis.
B Using the asymptotic standard error assuming the null hypothesis.
C Based on normal approximation.
Cross-tab
F.60 / Case Processing Summary
Cases
Valid
N
age know the right
definition *
Extended Warranty
Missing
Percent
81
N
54.0%
Total
Percent
69
N
46.0%
Percent
150
100.0%
F.61 / age know the right definition * Extended Warranty Crosstabulation
Extended Warranty
yes
age know the
right definition
18-25
25-35
35-above
Total
Count
% within age
know the right
definition
Count
% within age
know the right
definition
Count
% within age
know the right
definition
Count
% within age
know the right
definition
159
no
Total
23
6
29
79.3%
20.7%
100.0%
33
3
36
91.7%
8.3%
100.0%
16
0
16
100.0%
.0%
100.0%
72
9
81
88.9%
11.1%
100.0%
F.62 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
4.975(a)
6.289
2
2
Asymp. Sig.
(2-sided)
.083
.043
1
.028
df
4.836
81
a 3 cells (50.0%) have expected count less than 5. The minimum expected count is 1.78.
F.63 / Symmetric Measures
Interval by Interval
Pearson’s R
Ordinal by Ordinal
Spearman
Correlation
Value
-.246
Asymp.
Std.
Error(a)
.081
Approx.
T(b)
-2.255
Approx. Sig.
.027©
-.247
.087
-2.270
.026©
N of Valid Cases
81
a Not assuming the null hypothesis.
B Using the asymptotic standard error assuming the null hypothesis.
C Based on normal approximation.
Cross-tab
F.64 / Case Processing Summary
Cases
Valid
N
gender know the
right efinition *
Extended Warranty
Missing
Percent
81
N
54.0%
Total
Percent
69
46.0%
N
Percent
150
100.0%
F.65 / gender know the right efinition * Extended Warranty Crosstabulation
gender know the
right difinition
male
female
Total
Count
% within gender
know the right
difinition
Count
% within gender
know the right
difinition
Count
% within gender
know the right
difinition
160
Extended Warranty
yes
no
39
2
Total
41
95.1%
4.9%
100.0%
33
7
40
82.5%
17.5%
100.0%
72
9
81
88.9%
11.1%
100.0%
F.66 / Chi-Square Tests
Pearson Chi-Square
Continuity
Correction(a)
Likelihood Ratio
Fisher’s Exact Test
1
Asymp. Sig.
(2-sided)
.071
2.113
1
.146
3.430
1
.064
Value
3.266(b)
df
Exact Sig.
(2-sided)
Exact Sig.
(1-sided)
.088
Linear-by-Linear
Association
3.226
1
.072
.072
N of Valid Cases
81
a Computed only for a 2x2 table
b 2 cells (50.0%) have expected count less than 5. The minimum expected count is 4.44.
F.67 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson’s R
Spearman
Correlation
Value
.201
Asymp.
Std.
Error(a)
.099
Approx.
T(b)
1.822
Approx. Sig.
.072©
.201
.099
1.822
.072©
N of Valid Cases
81
a Not assuming the null hypothesis.
B Using the asymptotic standard error assuming the null hypothesis.
C Based on normal approximation.
Cross-tab
F.68 / Case Processing Summary
Cases
Valid
N
Income group that have
idea abou extended and
either they bought or not *
Prefer apply for extended
warranty when you buying
vehicle
Missing
Percent
110
73.3%
161
N
Total
Percent
40
26.7%
N
Percent
150
100.0%
F.69 / Income group that have idea abou extended and either they bought or not * Prefer apply for extended
warranty when you buying vehicle Crosstabulation
Prefer apply for extended warranty when you
buying vehicle
might
probab definitel
defiantl probabl
or not
y would y would
y would y would
might
not
not
Income
group
that
have
idea
abou
extende
d and
either
they
bought
or not
under 1000RM
1000Rm3000Rm
3000RM5000RM
above 5000RM
Total
Total
Count
% within Income
group that have
idea abou
extended and
either they
bought or not
Count
% within Income
group that have
idea abou
extended and
either they
bought or not
Count
% within Income
group that have
idea abou
extended and
either they
bought or not
Count
% within Income
group that have
idea abou
extended and
either they
bought or not
Count
% within Income
group that have
idea abou
extended and
either they
bought or not
1
12
11
3
27
3.7%
44.4%
40.7%
11.1%
100.0%
2
33
24
1
60
3.3%
55.0%
40.0%
1.7%
100.0%
2
14
5
21
9.5%
66.7%
23.8%
100.0%
2
2
100.0%
100.0%
5
61
40
3
1
110
4.5%
55.5%
36.4%
2.7%
.9%
100.0%
162
F.70 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
15.310(a)
15.449
12
12
Asymp. Sig.
(2-sided)
.225
.218
1
.014
df
5.990
110
a 14 cells (70.0%) have expected count less than 5. The minimum expected count is .02.
F.71 / Symmetric Measures
Interval by Interval
Pearson’s R
Ordinal by Ordinal
Spearman
Correlation
Value
-.234
Asymp.
Std.
Error(a)
.085
Approx.
T(b)
-2.506
Approx. Sig.
.014©
-.229
.092
-2.445
.016©
N of Valid Cases
110
a Not assuming the null hypothesis.
B Using the asymptotic standard error assuming the null hypothesis.
C Based on normal approximation.
Cross-tab
F.72 / Case Processing Summary
Cases
Valid
N
age group that have idea
abou extended and either
they bought or not * Prefer
apply for extended
warranty when you buying
vehicle
Missing
Percent
110
73.3%
163
N
Total
Percent
40
26.7%
N
Percent
150
100.0%
F.73 / age group that have idea abou extended and either they bought or not * Prefer apply for extended
warranty when you buying vehicle Crosstabulation
age group that
have idea
abou extended
and either they
bought or not
18-25
Count
25-35
% within age
group that
have idea
abou extended
and either they
bought or not
Count
35-above
% within age
group that
have idea
abou extended
and either they
bought or not
Count
% within age
group that
have idea
abou extended
and either they
bought or not
Count
Total
% within age
group that
have idea
abou extended
and either they
bought or not
Prefer apply for extended warranty when you
buying vehicle
might or probab definitel
defiantl probabl
not
y would y would
y would y would
might
not
not
1
12
16
3
1
9.1%
3.0%
3.0%
36.4%
48.5%
2
28
19
49
4.1%
57.1%
38.8%
100.0%
2
21
5
28
7.1%
75.0%
17.9%
100.0%
5
61
40
3
1
110
4.5%
55.5%
36.4%
2.7%
.9%
100.0%
F.74 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Total
33
Value
18.111(a)
18.965
13.378
8
8
Asymp. Sig.
(2-sided)
.020
.015
1
.000
df
110
a 9 cells (60.0%) have expected count less than 5. The minimum expected count is .25.
164
100.0%
F.75 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
-.350
Asymp.
Std.
Error(a)
.081
Approx.
T(b)
-3.887
Approx. Sig.
.000(c)
-.341
.087
-3.766
.000(c)
N of Valid Cases
110
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.76 / Case Processing Summary
Cases
Valid
N
gender that have idea
abou extended and either
they bought or not * Prefer
apply for extended
warranty when you buying
vehicle
Missing
Percent
110
N
73.3%
Total
Percent
40
N
26.7%
Percent
150
100.0%
F.77 / F.gender that have idea abou extended and either they bought or not * Prefer apply for extended
warranty when you buying vehicle Crosstabulation
Prefer apply for extended warranty when you buying
vehicle
might or probaby definitely
defiantly probably
not
would
would
would
would
might
not
not
gender that
have idea abou
extended and
either they
bought or not
Total
male
Count
female
% within gender
that have idea
abou extended
and either they
bought or not
Count
% within gender
that have idea
abou extended
and either they
bought or not
Count
% within gender
that have idea
abou extended
and either they
bought or not
Total
3
34
24
2
1
64
4.7%
53.1%
37.5%
3.1%
1.6%
100.0%
2
27
16
1
46
4.3%
58.7%
34.8%
2.2%
100.0%
5
61
40
3
1
110
4.5%
55.5%
36.4%
2.7%
.9%
100.0%
165
F.78 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
1.018(a)
1.385
4
4
Asymp. Sig.
(2-sided)
.907
.847
1
.486
df
.485
110
a 6 cells (60.0%) have expected count less than 5. The minimum expected count is .42.
F.79 / Symmetric Measures
Interval by Interval
Pearson's R
Ordinal by Ordinal
Spearman
Correlation
Value
-.067
Asymp.
Std.
Error(a)
.091
Approx.
T(b)
-.695
Approx. Sig.
.489(c)
-.055
.094
-.567
.572(c)
N of Valid Cases
110
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.80 / Case Processing Summary
Cases
Valid
N
Income group that have
idea but they did not bought
* If you interest to buy an
extended warranty with
your vehicle, how many
extended warranty period
you like to buy
Missing
Percent
60
40.0%
166
N
Total
Percent
90
60.0%
N
Percent
150
100.0%
F.81 / Income group that have idea but they did not bought * If you interest to buy an extended warranty with
your vehicle, how many extended warranty period you like to buy Crosstabulation
If you interest to buy an extended warranty
with your vehicle, how many extended
warranty period you like to buy
more
2
3
4
than 4
1 year
years
years
years
years
Income group
that have idea
but they did
not bought
under
1000RM
1000Rm3000Rm
3000RM5000RM
Total
Count
% within
Income group
that have idea
but they did
not bought
Count
% within
Income group
that have idea
but they did
not bought
Count
2
7
1
4
16
12.5%
12.5%
43.8%
6.3%
25.0%
100.0
%
3
2
14
6
12
37
8.1%
5.4%
37.8%
16.2%
32.4%
100.0
%
1
3
2
1
7
14.3%
42.9%
28.6%
14.3%
100.0
%
5
5
24
9
17
60
8.3%
8.3%
40.0%
15.0%
28.3%
100.0
%
% within
Income group
that have idea
but they did
not bought
Count
% within
Income group
that have idea
but they did
not bought
F.82 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Total
2
Value
4.527(a)
5.172
.541
8
8
Asymp. Sig.
(2-sided)
.807
.739
1
.462
df
60
a 11 cells (73.3%) have expected count less than 5. The minimum expected count is .58.
167
F.83 / Symmetric Measures
Interval by Interval
Pearson's R
Ordinal by Ordinal
Spearman
Correlation
Value
.096
Asymp.
Std.
Error(a)
.121
Approx.
T(b)
.732
Approx. Sig.
.467(c)
.098
.126
.751
.456(c)
N of Valid Cases
60
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.84 / Case Processing Summary
Cases
Valid
N
Age group that have idea
but they did not bought * If
you interest to buy an
extended warranty with
your vehicle, how many
extended warranty period
you like to buy
Missing
Percent
60
40.0%
168
N
Total
Percent
90
60.0%
N
Percent
150
100.0%
F.85 / Age group that have idea but they did not bought * If you interest to buy an extended warranty with
your vehicle, how many extended warranty period you like to buy Crosstabulation
If you interest to buy an extended warranty with
your vehicle, how many extended warranty
period you like to buy
more
than 4
1 year 2 years 3 years 4 years
years
Age group
that have
idea but they
did not
bought
18-25
Count
25-35
% within
Age group
that have
idea but they
did not
bought
Count
35-above
% within
Age group
that have
idea but they
did not
bought
Count
% within
Age group
that have
idea but they
did not
bought
Count
Total
% within
Age group
that have
idea but they
did not
bought
4
8
2
6
23
13.0%
17.4%
34.8%
8.7%
26.1%
100.0
%
1
1
12
6
8
28
3.6%
3.6%
42.9%
21.4%
28.6%
100.0
%
1
4
1
3
9
11.1%
44.4%
11.1%
33.3%
100.0
%
5
5
24
9
17
60
8.3%
8.3%
40.0%
15.0%
28.3%
100.0
%
F.86 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Total
3
Value
7.085(a)
7.639
1.310
8
8
Asymp. Sig.
(2-sided)
.528
.469
1
.252
df
60
a 11 cells (73.3%) have expected count less than 5. The minimum expected count is .75.
169
F.86 / Symmetric Measures
Interval by Interval
Pearson's R
Ordinal by Ordinal
Spearman
Correlation
Value
.149
Asymp.
Std.
Error(a)
.136
Approx.
T(b)
1.148
Approx. Sig.
.256(c)
.163
.134
1.256
.214(c)
N of Valid Cases
60
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.87 / Case Processing Summary
Cases
Valid
N
Gender that have idea
but they did not bought *
If you interest to buy an
extended warranty with
your vehicle, how many
extended warranty period
you like to buy
Missing
Percent
60
N
40.0%
170
Total
Percent
90
60.0%
N
Percent
150
100.0%
F.88 / Gender that have idea but they did not bought * If you interest to buy an extended warranty with your
vehicle, how many extended warranty period you like to buy Crosstabulation
Gender that
have idea but
they did not
bought
male
Count
% within
Gender that
have idea but
they did not
bought
Count
% within
Gender that
have idea but
they did not
bought
Count
% within
Gender that
have idea but
they did not
bought
female
Total
If you interest to buy an extended warranty with your
vehicle, how many extended warranty period you like to
buy
more
than 4
1 year
2 years
3 years
4 years
years
3
2
15
6
8
8.8%
5.9%
44.1%
17.6%
23.5%
100.0%
2
3
9
3
9
26
7.7%
11.5%
34.6%
11.5%
34.6%
100.0%
5
5
24
9
17
60
8.3%
8.3%
40.0%
15.0%
28.3%
100.0%
F.89 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
1.926(a)
1.927
4
4
Asymp. Sig.
(2-sided)
.749
.749
1
.692
df
.157
60
a 5 cells (50.0%) have expected count less than 5. The minimum expected count is 2.17.
F.90 / Symmetric Measures
Asymp.
Std.
Error(a)
Value
Interval by Interval
Ordinal by Ordinal
Total
34
Pearson's R
Spearman
Correlation
N of Valid Cases
Approx. Sig.
.052
.130
.393
.696(c)
.050
.132
.381
.705(c)
60
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
171
Approx.
T(b)
Cross-tab
F.91 / Case Processing Summary
Cases
Valid
N
income group that bought
vechile with extended
warranty * Do you think
buying extended warranty
can give you peace of
mind?
Missing
Percent
16
10.7%
N
Total
Percent
134
N
89.3%
Percent
150
100.0%
F.92 / income group that bought vechile with extended warranty * Do you think buying extended warranty
can give you peace of mind? Crosstabulation
Do you think buying extended
warranty can give you peace of
mind?
Extremely
yes
yes
not sure
income group that
bought vechile
with extended
warranty
Total
under 1000RM
Count
1000Rm-3000Rm
% within income
group that bought
vechile with
extended warranty
Count
3000RM-5000RM
% within income
group that bought
vechile with
extended warranty
Count
above 5000RM
% within income
group that bought
vechile with
extended warranty
Count
% within income
group that bought
vechile with
extended warranty
Count
% within income
group that bought
vechile with
extended warranty
172
Total
3
1
4
75.0%
25.0%
100.0%
1
4
2
7
14.3%
57.1%
28.6%
100.0%
1
2
1
4
25.0%
50.0%
25.0%
100.0%
1
1
100.0%
100.0%
2
10
4
16
12.5%
62.5%
25.0%
100.0%
F.93 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
1.886(a)
2.612
6
6
Asymp. Sig.
(2-sided)
.930
.856
1
.556
df
.347
16
a 12 cells (100.0%) have expected count less than 5. The minimum expected count is .13.
F.94 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
-.152
Asymp.
Std.
Error(a)
.187
Approx.
T(b)
-.576
Approx. Sig.
.574(c)
-.149
.210
-.562
.583(c)
N of Valid Cases
16
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.95 / Case Processing Summary
Cases
Valid
N
gender group that bought
vechile with extended
warranty * Do you think
buying extended warranty
can give you peace of
mind?
Missing
Percent
16
N
10.7%
Percent
134
173
Total
89.3%
N
Percent
150
100.0%
F.96 / gender group that bought vechile with extended warranty * Do you think buying extended warranty
can give you peace of mind? Crosstabulation
Do you think buying extended
warranty can give you peace of
mind?
Extremely
yes
yes
not sure
gender group
that bought
vechile with
extended
warranty
male
Count
female
% within gender
group that
bought vechile
with extended
warranty
Count
5
1
8
25.0%
62.5%
12.5%
100.0%
5
3
8
62.5%
37.5%
100.0%
2
10
4
16
12.5%
62.5%
25.0%
100.0%
% within gender
group that
bought vechile
with extended
warranty
Count
Total
% within gender
group that
bought vechile
with extended
warranty
Total
2
F.97 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
3.000(a)
3.819
2
2
Asymp. Sig.
(2-sided)
.223
.148
1
.106
df
2.609
16
a 4 cells (66.7%) have expected count less than 5. The minimum expected count is 1.00.
F.98 / Symmetric Measures
Interval by Interval
Pearson's R
Ordinal by Ordinal
Spearman
Correlation
Value
.417
Asymp.
Std.
Error(a)
.188
Approx.
T(b)
1.717
Approx. Sig.
.108(c)
.409
.197
1.679
.115(c)
N of Valid Cases
16
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
174
Cross-tab
F.99 / Case Processing Summary
Cases
Valid
N
age group that bought
vechile with extended
warranty * Do you think
buying extended
warranty can give you
peace of mind?
Missing
Percent
16
N
10.7%
Total
Percent
134
N
89.3%
Percent
150
100.0%
F.100 / age group that bought vechile with extended warranty * Do you think buying extended warranty can
give you peace of mind? Crosstabulation
Do you think buying extended
warranty can give you peace of
mind?
Extremely
yes
age group that
bought vechile
with extended
warranty
Total
18-25
Count
25-35
% within age
group that
bought vechile
with extended
warranty
Count
35-above
% within age
group that
bought vechile
with extended
warranty
Count
% within age
group that
bought vechile
with extended
warranty
Count
% within age
group that
bought vechile
with extended
warranty
175
yes
not sure
Total
2
1
3
66.7%
33.3%
100.0%
1
3
3
7
14.3%
42.9%
42.9%
100.0%
1
5
6
16.7%
83.3%
100.0%
2
10
4
16
12.5%
62.5%
25.0%
100.0%
F.101 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
3.810(a)
5.523
4
4
Asymp. Sig.
(2-sided)
.432
.238
1
.187
df
1.744
16
a 9 cells (100.0%) have expected count less than 5. The minimum expected count is .38.
F.102 / Symmetric Measures
Interval by Interval
Pearson's R
Ordinal by Ordinal
Spearman
Correlation
Value
-.341
Asymp.
Std.
Error(a)
.161
Approx.
T(b)
-1.357
Approx. Sig.
.196(c)
-.361
.166
-1.448
.170(c)
N of Valid Cases
16
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.103 / Case Processing Summary
Cases
Valid
N
income group that bought
vechile with extended
warranty * What is You
Impression about the cost
value that you paid
Missing
Percent
14
9.3%
176
N
Total
Percent
136
90.7%
N
Percent
150
100.0%
F.104 / income group that bought vechile with extended warranty * What is You Impression about the cost
value that you paid Crosstabulation
What is You Impression about the cost value
that you paid
barely
very
very
accept expens expens
cheap cheap
the
ive
ive
price
price
price
price
price
income group
that bought
vechile with
extended
warranty
under
1000RM
1000Rm3000Rm
3000RM5000RM
above
5000RM
Total
Count
% within
income group
that bought
vechile with
extended
warranty
Count
% within
income group
that bought
vechile with
extended
warranty
Count
1
1
1
3
33.3%
33.3%
33.3%
100.0
%
2
2
1
1
6
33.3%
33.3%
16.7%
16.7%
100.0
%
% within
income group
that bought
vechile with
extended
warranty
Count
% within
income group
that bought
vechile with
extended
warranty
Count
% within
income group
that bought
vechile with
extended
warranty
Total
4
4
100.0%
100.0
%
1
1
100.0%
100.0
%
3
3
5
2
1
14
21.4%
21.4%
35.7%
14.3%
7.1%
100.0
%
177
F.105 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
15.167(a)
19.296
12
12
Asymp. Sig.
(2-sided)
.232
.082
1
.432
df
.616
14
a 20 cells (100.0%) have expected count less than 5. The minimum expected count is .07.
F.106 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
.218
Asymp.
Std.
Error(a)
.202
Approx.
T(b)
.773
Approx. Sig.
.455(c)
.263
.270
.945
.363(c)
N of Valid Cases
14
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.107 / Case Processing Summary
Cases
Valid
N
gender group that bought
vechile with extended
warranty * What is You
Impression about the cost
value that you paid
Missing
Percent
14
9.3%
178
N
Total
Percent
136
90.7%
N
Percent
150
100.0%
F.108 / gender group that bought vechile with extended warranty * What is You Impression about the cost
value that you paid Crosstabulation
What is You Impression about the cost value that you
paid
very
cheap
price
gender
group that
bought
vechile with
extended
warranty
male
Count
female
% within
gender
group that
bought
vechile with
extended
warranty
Count
% within
gender
group that
bought
vechile with
extended
warranty
Count
Total
% within
gender
group that
bought
vechile with
extended
warranty
barely
accept
the price
cheap
price
expensiv
e price
very
expensiv
e price
1
1
3
1
1
7
14.3%
14.3%
42.9%
14.3%
14.3%
100.0%
2
2
2
1
7
28.6%
28.6%
28.6%
14.3%
100.0%
3
3
5
2
1
14
21.4%
21.4%
35.7%
14.3%
7.1%
100.0%
F.109 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Total
Value
1.867(a)
2.267
1.208
4
4
Asymp. Sig.
(2-sided)
.760
.687
1
.272
df
14
a 10 cells (100.0%) have expected count less than 5. The minimum expected count is .50.
179
F.110 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
-.305
Asymp.
Std.
Error(a)
.237
Approx.
T(b)
-1.109
Approx. Sig.
.289(c)
-.293
.248
-1.062
.309(c)
N of Valid Cases
14
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.111 / Case Processing Summary
Cases
Valid
N
age group that bought
vechile with extended
warranty * What is You
Impression about the
cost value that you paid
Missing
Percent
14
N
9.3%
180
Total
Percent
136
90.7%
N
Percent
150
100.0%
F.112 / age group that bought vechile with extended warranty * What is You Impression about the cost value
that you paid Crosstabulation
What is You Impression about the cost value that
you paid
very
barely
very
cheap
cheap
accept
expensi expensi
price
price
the price ve price ve price
age group
that bought
vechile with
extended
warranty
18-25
Total
Count
25-35
35-above
Total
% within age
group that
bought
vechile with
extended
warranty
Count
% within age
group that
bought
vechile with
extended
warranty
Count
% within age
group that
bought
vechile with
extended
warranty
Count
% within age
group that
bought
vechile with
extended
warranty
1
1
2
50.0%
50.0%
100.0%
2
1
1
1
1
6
33.3%
16.7%
16.7%
16.7%
16.7%
100.0%
2
4
6
33.3%
66.7%
100.0%
3
3
5
2
1
14
21.4%
21.4%
35.7%
14.3%
7.1%
100.0%
F.113 / Chi-Square Tests
Value
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Asymp. Sig.
(2-sided)
df
10.267(a)
12.704
8
8
.247
.122
.018
1
.893
14
a 15 cells (100.0%) have expected count less than 5. The minimum expected count is .14.
181
F.114 / Symmetric Measures
Interval by Interval
Pearson's R
Ordinal by Ordinal
Spearman
Correlation
Value
.037
Asymp.
Std.
Error(a)
.265
Approx.
T(b)
.129
Approx. Sig.
.899(c)
.040
.310
.137
.893(c)
N of Valid Cases
14
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
Cross-tab
F.115 / Case Processing Summary
Cases
Valid
N
income group that bought
vechile with extended
warranty * where extended
warranty
Missing
Percent
16
10.7%
182
N
Total
Percent
134
89.3%
N
Percent
150
100.0%
F.116 / income group that bought vechile with extended warranty * where extended warranty Crosstabulation
where extended warranty
salesperso ads/pro
n
motion
friend
income group that
bought vechile
with extended
warranty
under 1000RM
Count
1000Rm-3000Rm
% within income
group that bought
vechile with
extended warranty
Count
3000RM-5000RM
% within income
group that bought
vechile with
extended warranty
Count
above 5000RM
% within income
group that bought
vechile with
extended warranty
Count
% within income
group that bought
vechile with
extended warranty
Total
3
1
4
75.0%
25.0%
100.0%
1
5
1
7
14.3%
71.4%
14.3%
100.0%
1
1
2
4
25.0%
25.0%
50.0%
100.0%
% within income
group that bought
vechile with
extended warranty
Count
Total
other
1
1
100.0%
100.0%
2
10
2
2
16
12.5%
62.5%
12.5%
12.5%
100.0%
F.117 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
9.600(a)
10.389
9
9
Asymp. Sig.
(2-sided)
.384
.320
1
.484
df
.489
16
a 16 cells (100.0%) have expected count less than 5. The minimum expected count is .13.
F.118 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
-.181
Asymp.
Std.
Error(a)
.192
Approx.
T(b)
-.687
Approx. Sig.
.503(c)
-.068
.246
-.256
.801(c)
N of Valid Cases
16
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
183
Cross-tab
F.119 / Case Processing Summary
Cases
Valid
N
Missing
Percent
gender group that bought
vechile with extended
warranty * where extended
warranty
16
N
10.7%
Total
Percent
134
N
89.3%
Percent
150
100.0%
F.120 / gender group that bought vechile with extended warranty * where extended warranty Crosstabulation
where extended warranty
salesperso ads/pro
n
motion
friend
gender group
that bought
vechile with
extended
warranty
male
Count
female
% within
gender group
that bought
vechile with
extended
warranty
Count
% within
gender group
that bought
vechile with
extended
warranty
Total
4
1
1
8
25.0%
50.0%
12.5%
12.5%
100.0%
6
1
1
8
75.0%
12.5%
12.5%
100.0%
2
10
2
2
16
12.5%
62.5%
12.5%
12.5%
100.0%
% within
gender group
that bought
vechile with
extended
warranty
Count
Total
other
2
F.121 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
2.400(a)
3.175
.190
3
3
Asymp. Sig.
(2-sided)
.494
.365
1
.663
df
16
a 6 cells (75.0%) have expected count less than 5. The minimum expected count is 1.00.
184
Cross-tab
F.122 / Case Processing Summary
Cases
Valid
N
age group that bought
vechile with extended
warranty * where
extended warranty
Missing
Percent
16
N
10.7%
Total
Percent
134
N
89.3%
Percent
150
100.0%
F.123 / age group that bought vechile with extended warranty * where extended warranty Crosstabulation
where extended warranty
salesperso ads/prom
n
otion
friend
age group that
bought vechile
with extended
warranty
Total
18-25
Count
25-35
% within age
group that
bought vechile
with extended
warranty
Count
35-above
% within age
group that
bought vechile
with extended
warranty
Count
% within age
group that
bought vechile
with extended
warranty
Count
% within age
group that
bought vechile
with extended
warranty
185
other
Total
2
1
3
66.7%
33.3%
100.0%
1
4
1
1
7
14.3%
57.1%
14.3%
14.3%
100.0%
1
4
1
6
16.7%
66.7%
16.7%
100.0%
2
10
2
2
16
12.5%
62.5%
12.5%
12.5%
100.0%
F.124 / Chi-Square Tests
Pearson Chi-Square
Likelihood Ratio
Linear-by-Linear
Association
N of Valid Cases
Value
2.819(a)
3.971
6
6
Asymp. Sig.
(2-sided)
.831
.681
1
.216
df
1.532
16
a 12 cells (100.0%) have expected count less than 5. The minimum expected count is .38.
F.125 / Symmetric Measures
Interval by Interval
Ordinal by Ordinal
Pearson's R
Spearman
Correlation
Value
-.320
Asymp.
Std.
Error(a)
.204
Approx.
T(b)
-1.262
Approx. Sig.
.228(c)
-.234
.219
-.900
.383(c)
N of Valid Cases
16
a Not assuming the null hypothesis.
b Using the asymptotic standard error assuming the null hypothesis.
c Based on normal approximation.
186
APPENDIX G
CHI-SQUARE DISTRIBUTION TABLE