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Peoples always start their businesses in many reasons, but staying in business always comes down to two things. That is growing revenues and generating a profit. That's why successful business owners are those who know where to apply their resources for achieving the greatest positive impact on business performance. Nowadays, onlinepurchase is a very commons and efficient way in the world. Consumer can purchase product like shopping via the internet without going out. They just need to connect with the internet, use their computer to buy whatever they like through the internet. With the competitive market, companies always come out with many different and special solutions to attract customer to buy their product. However, online service is the one of the service they used to attract customer.
An example of a successful corporate, Malaysia's AirAsia Berhad used Low-Cost budget pioneered e-commerce and online business when it began operation 8years ago. Currently 75% of its business transactions are done online. It has an average of 16 million unique visitors a month. (Lee, 2009) With the convenience of the internet, low-cost budget, and the slogan of "Everyone can fly", AirAsia Berhad had fixed an image when people think for Fly.
There are around 888 million users of Internet for worldwide in 2004. It is expected to growth until 1.35 billion by 2007 (Internet World Stats, 2005). In the global online population, Asia rank the highest percentage followed by Europe and then North America with Asia is 34, Europe is 29.2 and North America is 24.9 (Internet World Stats, 2005). By 2010, there will be 17 million internet users in Malaysia. (David, 2009) In other words, Malaysia internet users are increasing speediness year by year. Small business should focus on online business to gain more revenue. By the way, online purchase will also increase in Malaysia's market.
Service Quality is determined by customer satisfaction. Service Quality is an attitude of consumer after they used your business product and service. Besides, traditional service quality is different with the service quality via internet. Traditional service quality is services by using face to face communication ways with customer, however service quality via internet are not working for face to face. They usually used post to deliver product and communication by the e-mail. Between, online service can provide customer non-stop in every year 365 days and everyday 24 hours service but traditional businesses are unable to do this. This had reasoned some of the small business is creating theirs own website to offer customer this convenience.
In this study, there are 5 independent variables used. Include Responsiveness, Personalization, Trust, Reliability and Convenience. In this study, I will to find out the impact of service quality on the online business in Malaysia.
1.2 Research Background
Lamb et al. (1992) defined that service includes all interactions between a business and its customers. It is beginning with the initial contact and extending through the delivery service and actual sale of a product in order to include all the services provided afterward. With this definition, service is delivered in all market transactions, whether any intangible goods or tangible goods are involved on it.
Nowadays, service quality is always emphasized by consumer. Peoples today are not only stand on the quality of the product but also the quality of the service. We can see that the important of service is more and more be concern by the consumer. For example, in 1988, Zeithaml had defined customer's assessment of the overall excellence or superiority of the service is all about the perceived of service quality. In the same way, Ciampa (1992) explained that customer expectations is a function of product or service quality, which extend beyond the product itself into every aspect of the relationship between the business and the customer. Consumers today are always required the quality of the service that the company provide more than the quality of the product. For example, comparing with the Dell and Acer companies, consumers prefer buy the product from Dell more than Acer. This is because Dell Company can provide a better service that brings a lot of convenience to their customer.
With the condition for exist. Small & Medium Enterprise (SME) is an operated and privately owned with no more than 500 employees. Example of small business includes fast-food restaurant, floral, CD shops, neighborhood grocery stores, gown boutique. Many small business enterprises had finding much kind of different ways to achieve customer satisfaction. Service provide from the company include delivery, call center, friendly customer service and other.
In a competitive market place understanding customer needs become a very important factor. As a result, many companies have to move to customer centric position from a product-centric companies(Hanson, 2000). Some of the companies had set up company's website to provide a better quality service to achieve customer's needs. With this service, they can help their business to get higher profit. After fully used of this advantage, companies and customer have get into the competitive advantage.
In the result, world internet usages are increased every year. It is same go with Malaysia. Nowadays, many companies found that it's difficult to make their physical product differ with other competitors. So, they are now more focus on the differentiation of service that can make more competitive advantage.
From the Internet World State (2009) reported, Malaysia internet user in 2007 have 13,528,200 peoples, that is 47.8%, while in the year of 2008, user are increase to 62.8%. Other than that, Internet World State also shows that in the latest survey which is end of June in 2009, there are 16,902,600 internet users in Malaysia. It had increased 2.9% compare with half year before in the year of 2008. In Asia area, there is only 18.5% internet user are staying online to connect to the world. In other world regions such as Europe there is a 50.1% internet user, Australia is 60.1% users and North America is 73.9%. Compare with Asia and other world region, Asia has lesser internet user.
In other words, compare with other countries such as North America, Malaysia small business is less adoption to the internet to implement the new technologies for the strategic purpose. Internet adoptions in other countries' business had been a very long history in the industry. Information gathering, marketing, advertising, customer support and service and electronic transaction are the earlier of adopters for the internet that was used for the range of functions. Malaysia small business should learn from other country to fully use the advantage of internet to improve their business and extend their market. A good service quality can improve the relationship between customers and make them more loyalty to your business.
Besides that, some of the Malaysia companies don't really understand the way to attract new customer or retain current customer to buy their product and services by the advantage of internet. With the convenience of the internet, it can help to increase their company profit and let more customers know about their business. So, I had come out with this problem statement which is, what is the impact of service quality in the online business today to gain a competitive advantage with online business?
1.4 Objective of study
This study is to find out the important of service quality that provide in the online business in this technology era.
- To study the important of service quality attitude.
- To identify the relationship between responsiveness of service quality and online businesses in Malaysia
- To identify the relationship between personalization of service quality and online businesses in Malaysia
- To identify the relationship between trust of service quality and online businesses in Malaysia
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