TITLE: RESEARCH ON FACTORS INFLUENCING CUSTOMER SATISFACTION – A CASE STUDY OF DANAPHA PHARMACEUTICAL COMPANY, VIETNAM

Thesis proposal
Student name: Duong Chi Toan
Class: SD-MBA 1
ID: 11752321
1
TITLE: RESEARCH ON FACTORS INFLUENCING
CUSTOMER SATISFACTION – A CASE STUDY OF DANAPHA
PHARMACEUTICAL COMPANY, VIETNAM
Advisor: Shyh-Hwang Lee
Co-advisor: Nguyen Xuan Lan

Content

1. Introduction
Research background
Research motive
Research purpose
Research procedure

2. Literature review.

3. Research methodology
Research model
Research hypothesis
Measurement of variable
Data collection

4. Expected result and implication of result
Keywords

Customer satisfaction


Corporate image

Perceived value

Customer expectation

Pharmaceutical services

1. Introduction
Background

Vietnam is a country located in the South East Asia.
Vietnam has population of 87 millions in 2010 with
under 75% of population are under 40 year old
(General department of statistic, 2010)

The total value of drugs used over US$ 1.9 billions in
2010. On average, one person spent about US$ 21.8
per year for drug in 2010. (Vietnamese Drug
administration, 2010)

BMI forecasts in the next 5 years, pharmaceutical
market in Vietnam will be a potential market for
foreign companies (Business Monitor International
Ltd, 2010)
Background (con’t)

Currently, the capacity of the domestic pharmaceutical
industry can only meet nearly 50% of value, the other

mainly come from import.

Under WTO commitments, the foreign pharmaceutical
companies have the right to open branches in Vietnam
and was directly involved in import of pharmaceuticals,
even though no distribution rights.

Vietnam’s pharmaceutical market has strong
competition. Nearly 200 domestic enterprises and 500
foreign enterprises.
Background (con’t)

Danapha was founded in 1965 by the government,
Since January 1st 2007, company have changed into
joint stock company. It is located in Danang city,
central of Vietnam.

The company has 370 employees with total of capital
is US$ 4.7 million. ( Danapha annual report, 2011).

It is one of the biggest pharmaceutical enterprise in
the central of Vietnam. The company is special in
manufacturing and distributing pharmaceutical
products in Vietnam market.
Background (con’t)

The company has five branches for distributing
company’s product nationwide, each branch take care a
lot of agencies and pharmacies in many provinces
around it.


Beside Vietnam market, Danapha also developed
abroad market such as Russia, Ukraine, Cambodia,
Laos…
Research motive

Understanding what factors influencing customer
satisfaction may be a good advantage for company
development in the competitive market.

Not many researches on customer satisfaction have
been carried and published in Vietnam.

There is a real incentive for me to help my company
having a better standing in the central of Vietnam.
Research purpose

To identify the key factors which influence customer
satisfaction in pharmaceutical service-a case study at
Danapha pharmaceutical company.

This study also provide to company some suggestions
to meet customers’ needs, thereby enhancing
customer satisfaction.

Providing managerial implications for marketing
practice
Research procedure
Define the research questions
Define research motives & purposes

Literature review,
define research model,
data collection method
Interpretation of data
Result & discussion
Implications and limitations
2. Literature review
Literature review
Customer satisfaction

Customer satisfaction construct indicates how much
customers are satisfied, and how well customer
expectations are fulfilled. This construct evaluates
overall satisfaction level of customers, fulfillment of
their expectations, and company’s performance
versus the ideal provider (Gustafsson et al. 2005 ).

Customer satisfaction is the main factor that
influences customer behavior (Woodside, Frey, and
Daly,1989).
Literature review (Con’t)
Customer expectation

Customer expectations are consequent of prior
experience with the firm’s products (Rotondaro, 2002).
This concept evaluates customer expectations for overall
quality, for product and service quality, and for
fulfillment of customer’s needs

According to Zeithaml and Bitner (1996), expectations

are what customers believe a service or product
should or will be.

Customer expectations include two levels, they are the
desired expectation and the adequate expectation
(Parasuraman et al,1991)
Literature review (con’t)
Perceived value

Bolton and Drew (1991) defined the service value as
“consumer’s overall evaluation of service utility with
respect to what they get for what they give”

Perceived value is considered as one source of
competitive advantage (Woodruff, 1997).

Five dimensions of value: (1) functional value, (2)
emotional value, (3) social value, (4) conditional value,
and (5) epistemic value. Different dimensions have
different importance in the decision of customers
Literature review (con’t)
Corporate image

Corporate image is as the overall impression made on the
minds of the public about a firm (Barich and Kotler,1991).

Corporate image is the result of a process, this process
increase from ideas, feelings, and previous experiences with
a firm that are created from memory and transformed into
mental images (Yuille and Catchpole, 1977)


The image concept evaluates the underlying image of the
company, it refers to the brand name and the kind of
associations customers obtain from the company
(Andreassen & Lindestad, 1998)
Literature review (con’t)
Perceived quality

According to Bayraktar et al (2012), “Perceived quality is
evaluation of consumption experience by the market served.
This concept evaluates customization and reliability of a
product or service. Customization is the degree to which a
product or service meets requirements of customers, and
reliability is the degree to which company’s offering is
reliable, standardized, and free from deficiencies”

Anderson & Sullivan (1993) verified that perceived quality
has been considered one of the important variables effecting
on customer satisfaction
3. Research methodology
Research model
Fig 2. Research model
This study accepts the The Taiwan Customer Satisfaction Index-
automobile industry model (Chiu et al, 2011) for investigating
customer satisfaction as the backbone of research model

Corporate image
Customer expectation
Perceived value
Perceived quality

Customer satisfaction
Research hypothesis
We have four following hypotheses:

H1. Corporate image has a positive effect on customer
satisfaction.

H2. Customer expectation has a positive effect on
customer satisfaction.

H3.Perceived quality has a positive effect on customer
satisfaction

H4. Perceived value has a positive effect on customer
satisfaction.
Measurement of variable
We have total of 18 items as following:

Corporate image (3 items): good impression; good
image in the minds of consumers; has a better image
than their competitors (Nguyen & Leblanc, 2001)

Customer expectation (5 items): Overall expectation;
attitude and appearance of employees; employees ability,
knowledge, and service; reliability of the products;
products to meet my needs (Chiu et al, 2011)
Measurement of variable (con’t)

Perceived quality (5 items): attitude, appearance and
kindness of the provider’s staffs, ability, knowledge of

Danapha’s staffs, Reliability of products, ability of
products to meet my personal needs, Overall
evaluation (Chiu et al, 2011)

Perceived value (2 items): product value to the cost,
comparing to other company products

Satisfaction ( 3 items): provider is a wise one; I did
the right thing; satisfied with the selection (Deng et
al,2010)
Data collection

Data collection methods: Questionnaire survey with
structured questions, sent by mail or handout.

All variables were measured by seven- point Likert
scale

Population of this study includes about 150 respondents
(pharmacy owners – drug store).

Samples will be chosen by convenient selection ( from
Danapha’s customer list).

The statistical program packages SPSS 16 will be used
to interprete the data.
Expected result and implication of result

I expect that four dimensions (factors) have significant effect
on customer satisfaction in pharmaceutical sector.


The study success will be advantage to propose a simple
model to research customer satisfaction in pharmaceutical
sector

Shows the opportunity for pharmaceutical strategists in
Vietnam to explore dimensions effecting on satisfaction
before deciding an appropriate marketing strategy.

Provides the marketing managers seeking for better
understanding of customer satisfaction, in order to focus on
potential marketing activities to maintain or improve
customer satisfaction.
Timetable
Time to
complete
Activity
2012
Sep 1
st
- Sep 20
th

Complete chapter 1 & 2
Oct – Oct 15
th

Questionnaire design
Complete chapter 3
Oct 16

th
- Oct 31
st

Pre testing questionnaire survey
Revise questionnaire survey if necessary
Nov
Sent out questionnaire survey
Collecting questionnaire survey
Dec
Data Analysis
Complet chapter 4
2013
Jan
Complet chapter 5
Full thesis completed and submitted thesis
Feb Ready for oral thesis defense