Antecedebts of customer repurchase intention AS of online group buying in vietnam

UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business



Tu Van Anh


ANTECEDENTS OF CUSTOMER
REPURCHASE INTENTION -
A STUDY OF ONLINE GROUP-BUYING
IN VIETNAM



MASTER OF BUSINESS (Honours)




Ho Chi Minh City – Year 2013



UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business



Tu Van Anh

ANTECEDENTS OF CUSTOMER
REPURCHASE INTENTION -
A STUDY OF ONLINE GROUP-BUYING
IN VIETNAM

ID: 60340102


MASTER OF BUSINESS (Honours)
SUPERVISOR: Prof. LE NGUYEN HAU



Ho Chi Minh City – Year 2013
ACKNOWLEDGEMENT
This thesis could not be finish without the help and support of many people who
are gratefully acknowledged here.
At the very first, I would like to express my deepest gratitude to my supervisor,
Prof. Le Nguyen Hau. With his guidance, I could have worked out this thesis. He
had offered me valuable suggestions and criticisms with his profound knowledge in
rich research experience.
I am grateful to express my sincere to Prof. Nguyen Dinh Tho. I have learned
from him a lot not only about research design, but also data analysis technique. I am
also extremely to give thankful to UEH – International School of business (ISB)
supported me in all process.
I would like to extent my sincere thanks to all my classmate and friends. Their
kindness and supports have contributed very much in my working process. Most
important, I would like to express my most sincere thanks to my father, my mother
and my brother for their continuous encouragement and support

Declaration
I hereby declare that this thesis, to the best of my knowledge and belief, is my
own work and effort and that is has not been submitted, either in part or whole,
anywhere for any award.
Information and ideas taken from other sources as cited as such. This work has
not been published.



Signature: Tu Van Anh
Date: 18/02/2013
TABLE OF CONTENTS
ABSTRACT
CHAPTER 1. INTRODUCTION 2
1.1 Research interest 2
1.2 Motivation of the study 4
1.3 Research objectives 6
1.4 Methodology and scope of research 6
1.5 Research structure 7
CHAPTER 2. THEORETICAL BACKGROUND 8
2.1 Introduction 8
2.2 Theoretical background 8
2.2.1 Online group-buying model 8
2.2.2 IS repurchasing behavior model 9
2.2.2.1 Online customer retention 10
2.2.2.2 Online group-buying repurchase model 13
2.2.3 Website quality 14
2.3 Research model 16
2.3.1 Perceived Usefulness 19

2.3.2 Customer satisfaction 20
2.3.3 Customer trust 20
2.3.4 Hypotheses related to website quality 21
2.4 Conclusion 23
CHAPTER 3. RESEARCH METHOD 24
3.1 Introduction 24
3.2 Research design 24
3.3 Instrument construction 26
3.4 Pilot test results 29
3.4.1 Cronbach Alpha 29
3.4.2 EFA for website quality scales 31
3.5 Conclusion 32
CHAPTER 4. ANALYSIS AND RESULTS 33
4.1 Introduction 33
4.2 Respondents demographic 33
4.3 Scale validation 34
4.3.1 Preliminary results 34
4.3.2 Confirmatory factor analysis (CFA) 38
4.3.2.1 CFA results 38
4.3.2.2 Saturated model 43
4.4 Modified research model 45
4.5 Model fitness 46
4.6 Bootstrap 47
4.7 Hypotheses testing 48
4.8 Conclusion 49
CHAPTER 5. CONCLUSIONS AND LIMITATIONS 50
5.1 Introduction 50
5.2 Discussion and conclusion 50
5.3 Managerial implications 52
5.4 Limitations and future research 54

REFERENCES
APPENDICES

LIST OF FIGURE


Figure 2.1 A post-acceptance model of IS continuance 11
Figure 2.2 Research model 19
Figure 3.1 Research process 25
Figure 4.1 CFA model of online group-buying repurchase intention scale 39
Figure 4.2 CFA model of trust scale 40
Figure 4.3 CFA model of satisfaction scale 40
Figure 4.4 CFA model of website quality scale 41
Figure 4.5 Saturated model of main survey 44
Figure 4.6 Modified research model 46
Figure 4.7 SEM result of research model (Standardized) 46

LIST OF TABLE


Table 2.1 Some integrated models of customer retention 12
Table 3.1 Sources of questionnaire items 28
Table 3.2 Cronbach alpha result of pilot test 30
Table 3.3 EFA result of pilot test 32
Table 4.1 Respondents demographic 34
Table 4.2 Cronbach alpha result 35
Table 4.3 EFA result of main study 37
Table 4.4 Confirmatory factor analysis of measurement model 42
Table 4.5 Relationship between constructs of research 45
Table 4.6 Relationship between constructs in research model (standardized) 47

Table 4.7 Bootstrap estimate result with N = 1000 47
Table 4.8 Result of hypotheses testing 48

LIST OF ABBREVIATION


AVE Average Variance Extracted
CFA Confirmatory Factor Analysis
CR Composite Reliability
ECM Expectation-Confirmation Model
ECT Expectation-Confirmation Theory
EFA Exploratory Factor Analysis
E-commerce Electronic commerce
E-SQ Electronic commerce – Service quality
IS Information System
ML Maximum Likelihood
OGB Online group-buying
SEM Structural Equation Model
SPSS Statistical software package
TAM Technology Acceptance Model
TPB Theory of Planned Behavior
TRA Theory of Reasoned Action
1




ABSTRACT
Online group-buying has emerged as a new e-commerce model and received
attention in both academics and practice. Prior researches focused on investigating

online group-buying mainly from the marketing perspective, such as the transaction
process, price mechanism, and benefits (Li & Liu, 2012). Few of studies have
investigated the relation between consumer’s acceptance and their purchasing
behavior. Hence, this study focuses in measuring relationship between cognitive
factors – trust, satisfaction and perceived usefulness – and online group-buying
repurchase intention. Simultaneous, this study also integrates website quality - a direct
and indirect variable – to measure its impact on customer repurchase behavior.
To examine research model, information and data is accessed by using
questionnaire for respondents more than 18 years old and have ever purchased on
online group-buying websites. Sample size of this quantitative research is 365
respondents. Confirmatory factor analysis (CFA) is used to test measurement scale
and the structural equation modeling (SEM) is used as the main method for analyzing
research model and hypotheses.
Results in this study show that individual user’ intention to repurchase in online
group-buying websites is motivated by trust, satisfaction and website quality. Among
three impact factors, website quality has the strongest direct influence, followed by
trust and satisfaction. Besides direct influence, website quality also has indirect
impact on customer repurchase intention through both of trust and satisfaction. Trust
also has strong impact on customer satisfaction, thus, affect indirectly to customer
retention.
With these results, research framework can be seen fitted with data market. Study
results also suggest that in order to increase customer retention should not only
consider about their strategies of increasing trust and satisfaction, they should also
take consideration of increasing website quality, especially in content quality and
technical adequacy.
2

CHAPTER 1
INTRODUCTION
This chapter is starting point of this study. In this chapter, the research interest of
thesis is first introduced. Subsequently, the motivation of this research is discussed.
Research objectives are presented in the next section. Then, methodology and scope of
this research is introduced summarily. Final, structure of this study is presented. This
chapter aims at specifying the purpose of this research and the research content.
1.1 Research interest:
In recent decades, science and technology develops surprisingly. Achievements of
these progresses create more opportunities as well as challenges for development of
economies. Forms of transactions become more diversified; suppliers have more
approach ways to interact with customers. Traditional markets have not caught up
with higher demands of consumers. Buyers become more and more busy and have so
many choices that make their buying decisions more difficult. Hence, to satisfy
customers, electronic commerce appears and grows extraordinarily with widespread
Internet usage.
Electronic commerce, commonly known as e-commerce, consists of the buying
and selling of products or services over electronic systems such as the Internet and
other computer networks. A form of e-commerce is online shopping which is the
process whereby consumers directly buy goods or services from a seller in real time,
without an intermediary service, over the Internet. This form of shopping are
attracting more buyers, suppliers and researchers because it offers a lot of benefits
such as convenience, speed, time, a 24-hour opening, information on products and
reviews. To nowadays, online shopping continues their rapid spread and gains many
increasing importance in the lives of a wider range of the population.
Group-buying is seen as an effective form of online shopping and a promising field
for applying agent technologies. Group-buying is a model in which multiple buyers
cooperate and buy goods at a discount price (Matsuo, 2009). Innovative group-buying
sites offer bargains on everything from meals to travel packages. Customers can make
3

comparison of product/service prices and choose the supplier with the lowest price
(Gounaris et al., as cited in Li & Liu, 2012) when using this new model.
With the tremendous growth, online group-buying attracted more and more
attention of practitioners as well as researchers. However, most previous online group-
buying studies focus mainly on the pricing mechanisms, coalition formation, benefits
of bidder cooperation, uncertain demand, incentive mechanisms and consumer
adoption (Fan et al., 2010). There are not many studies investigated the relationship
between customers’ acceptance of online group-buying and their purchasing behavior.
In recent years, this topic begins become a hot issue, especially, continuance behavior
receives more attention because this issue at an individual level has been regarded as
crucial for sustainable web-based services (Premkumar & Bhattacherjee, 2008).
Besides that, many online group-buying websites as well as others online websites
are facing strong competition due to the evolution and proliferation of web-based
services. Moreover, web-based services have low entry barriers by its nature, if one
service is created, then a number of comparable alternative web-based services
follow, resulting in a high switching rate between those services by users
(Vatanasombut et al., as cited in Lee & Kwon, 2011). Thus, many online group-
buying providers are struggling to find strategies to exist in this difficult period.
Retaining their existing customers becomes a strategic way to ensure the company's
success and overall sustainability. Exploring and analyzing which factors influence
customer retention have significant meaning to online providers.
Research on continuance intention in both online shopping and online group-
buying is still in its infancy. Prior researches on consumer online repurchase placed
more emphasis on the impact of psychological factors such as trust, satisfaction
formation, loyalty (Cheung et al., 2003). These researches primarily base on
expectation-confirmation theory and information system (IS) continuance intention

model. Very few studies have attempted to investigate the impact of product/service
characteristics as well as website quality on online consumer continuance.
4




Website quality nowadays is assumed to have the potential to influence the future
behavior of service users and have an impact on the profits of IS investment (Cronin
and Taylor; Zeithaml, Berry and Parasunaman, as cited in Li, 2010). Several studies
on website quality in physical encounters have concluded that some factors of website
quality are responsible for customers’ perception which is likely to lead to behavioral
intentions to purchase. However, in online group-buying context, according
mentioned above, there are a few of studies attempted to measure the direct and
indirect impact of website quality to repurchase behavior. In particular, research on
taking an integrated perspective to examine the predictors of website quality and
investigate the relationship between website quality and repurchase intention is still
lacking. This is a promising topic for future research in this context of e-commerce.
1.2 Motivation of the study:
In Vietnam, group-buying model was introduced in 2010 and after a short time,
group-buying model and daily deal sites increased very quickly. With a win-win-win
model for three parties: enterprises can sell their products, group-on companies profit
from commission and customers can get good deals, group-ons or group vouchers
have become popular among Vietnamese students and white-collar workers due to
attractive discounts and a wide range of services and products
1
.
To the end of 2011, there are almost 100 group-on sites in Vietnam with more
than 6700 deals and 4.2 millions sold out vouchers
2

. Four leading group-buying
websites include: Nhommua, Hotdeal, Cungmua and Muachung. Ho Chi Minh City is
the strongest competition market with about 74% transaction deals and many
followers
2
. Other markets such as Da Nang, Binh Duong, Can Tho… begin introduce
this new model, however, amount of transaction is still limited.
Along with development of group-buying market, perceived risk and competition
between rivals also increase very strongly. The biggest challenge for group-buying

1
/>20110502-1e3l1.html
2

5




sites is method of payment and privacy. In Vietnam, many people are still not familiar
with online transaction. With weak privacy security system, customer beliefs have
trend of reducing when purchasing vouchers by money transfer or cash on delivery
method. Besides, there are many partners who do not follow the contract, provide bad
service or treat group-on customers differently. Many vouchers are delivered late or
lost, customers cannot dictate the time to receive vouchers and have to book in
advance to use the service. With many problems, online-group buying websites in
Vietnam are facing many difficulties in attracting customers as well as keeping
existing customers.
Base on operational experiences in vouchers transaction, many group-buying
businesses begin selecting other ways to limit their obstacles. Firstly, they can

become distributors, delivery directly products to customers, instead of delivering
vouchers. Second, group-buying company can become e-commerce exchange. They
can buy and manage deals by themselves. They also provide some flexible solutions
for suppliers such as: create own websites, provide orders management system, and
provide customers management system… However, according to many experts the
key to success for this kind of business is still to ensure service quality and price to
keep customer trust. Do (2012) – who is interested in Vietnam’s start-up, social media
and technology scenes – cites that:
An increased skepticism of the online space is low on the list of dangers though. With the
internet penetration at 34 percent and an increasing portion of them moving into social media,
the online market is getting bigger and bigger. Although companies and people may not be
trusting of web content, they are learning more and more to be dependent on it.
In general, Vietnam is still a promising market for online group-buying model.
Companies in this market need to learn and develop more and more to succeed.
Customer retention is a necessary topic for helping group-buying businesses increase
their competitive advantages and maintain their market. Simultaneously, online
group-buying model is really an interesting research field for practitioners and
researchers in developing way of e-commerce in Vietnam.
6




1.3 Research objectives:
As discussion in section 1.1, information system (IS) retention has been one of the
most recently explored topics in the IS research field. Many theoretical perspectives,
to nowadays, have been advanced in order to understand what motivates individuals
to repurchase in online group-buying websites. Thus, based on literature covering the
concept of IS continuance model and circumstance of online group-buying market in
Vietnam, this paper aims:

 To propose a model predicting customers’ repurchase intention in online
group-buying context in Vietnam.
 To investigate impact of website quality on customers’ repurchase intention
in online group-buying context.
 To examine impact of cognitive factors (trust, satisfaction and perceived
usefulness) on online group-buying repurchase intention.
This study is necessary for development of group-buying market in Vietnam. It
also demonstrates that website quality is a noteworthy factor affect repurchase
intention of customers in using online group-buying.
1.4 Methodology and scope of research:
Collecting data process of this study is designed into two stages. First is a pilot
test, second is main survey to collect data for examining research model. Pilot test is
quantitative research with sample 57 respondents to examine reliability and validity
of observed variables. Main study is also quantitative research with sample size 365
respondents.
Author accesses information and collect data by using questionnaire. Respondents
are more than 18 years old and have ever purchased on online group-buying websites.
Sample is selected by using non-probability sampling method – convenience sample.
Research is studied from September 2012 to December 2012.
Purpose of this research is to confirm and examine conceptual model. The
measurement scales are estimated using confirmatory factor analysis (CFA) to test
7




reliability and validity. The structural equation modeling (SEM) is used as the main
method for analyzing the research model and hypotheses.
1.5 Research structure:
This thesis is organized into five chapters. It begins with introduction chapter

which presents an outline of this research, including the motivation, objectives and
scope of this research. The next chapter describes online group buying model,
literature of IS repurchase behavior model and website quality concept. This chapter
also describes research model and hypotheses. The third chapter is research
methodology used to empirically test the research model. The fourth chapter presents
the results of data analysis. The final chapter discusses summarizes the study’s core
findings, its contributions and its limitations.

8




CHAPTER 2
LITERATURE REVIEW AND HYPOTHESES
2.1 Introduction:
This chapter mainly introduces theoretical background and research model of the
study. First, online group-buying model is introduced to clarify more clearly about
advantages and disadvantages of this new model. Second, literatures of IS repurchase
models in online shopping and online group-buying context are discussed. Next,
concepts and instruments of website quality are reviewed systematically. Finally,
research model, its constructs and relationship hypothesized among the constructs are
discussed.
2.2 Theoretical background:
2.2.1 Online group-buying model:
Group-buying, also known as collective buying, introduced in 1999 by a few of
companies. After introducing time, this model have been facilitated by the internet and
the easy, fast group coalition process brought by social networks (Xiong & Hu, as
cited in Erdogmus & Cicek, 2011). It is seen as a part of an innovative wave of online
market-based pricing mechanisms, includes traditional auctions, non-traditional

auctions, price-reduction models and group-buying models.
There are mainly two different types of online group-buying systems (Fei et al., as
cited in Erdogmus & Cicek, 2011). First type of this system is structured based on a
dynamic pricing mechanism. In this first type, masses of consumers are aggregated,
and perform collective buying to enjoy price discounts online. In the second type of
the online group-buying, the group-buying company offers a certain product or
service at a static large discount price. This price required the total number of the
buyers must be greater than the predetermined limit of the minimum required number
of buyers.
Today, many online websites are using group-buying models and have got great
success. These websites usually offers a large of products and services at significantly
9




reduced prices. These websites claim they can negotiate low prices with manufacturers
and suppliers, and then pass these savings on to their customers (Kauffman & Wang,
2001).
However, group-buying websites, like other online shopping websites, are facing the
problem of obtaining market attention. With group-buying models, online group-buying
websites need not only a critical mass of consumer patronage and interest, but also a
significant amount of transaction volume so as to be able to profitably deliver on
their low price guarantee. Thus, if they cannot reach a critical mass of users and sales
volume, then it will be difficult for the group-buying business model to bring the
customers of the firms that adopt it the savings they expect (Kauffman & Wang, 2001).
Moreover, Cook (as cited in Kauffman & Wang, 2001) points out that the group-
buying business model is too difficult for the general consumer to understand. The
author also argues that the mechanics of group-buying on the Internet also prevent
impulse buying, due to the lengthy periods consumers have to wait until the end of

auction cycles. With these problems, amount of customers of online group-buying
websites begin increasing slower; in some markets, there are reducing signs of
customers as well as transactions.
In order to overcome obstacles, some online group-buying websites focus website
quality and service quality. For instance, Mobshop – a San Francisco, California-
based group-buying service provider- increased from 37.00 to 132.000 registered
users in a three month period from January to April 2000 (as cited in Kauffman &
Wang, 2001). Its early success attributed by its careful design, increasing technical
adequacy and saving delivery time. Focusing on quality is a good strategy for online
group-buying websites in highly competition market at current time and in the future.
2.2.2 IS repurchasing behavior model:
Online buying behavior can be understood in two stages: the first stage is primarily
concerned with the encouraging people to purchase online and the second is to
encourage them to repurchase, which is critical if the e-commerce vendor is to
succeed (Zang et al., 2011). In these two stages, second stage is an important subject
10




of study because customer retention is often seen as a means to gaining competitive
advantage.
Researchers have studied online customer retention in different contexts, such as
“online repurchase intention”, “continue to shop online”, “customer intention to
return”, “web site stickiness”, and “continued information systems/IT intention”
(Wen et al., 2011).
2.2.2.1 Online customer retention:
Online customer retention in recent years, become a hot issue in both the IT and
marketing areas. Studies of this topic have been mainly divided into two streams
consisted of studies based on static-type models and process-type models (Lin & Ong,

2010).
(1) Static-type researches are derivation from concepts such as theory of planned
behavior (TPB), Fishbein and Ajzen's theory of reasoned action (TRA) or
technology acceptance model (TAM). The theory of Reasoned Action assumes
that if people view a behavior as positive (attitude), and if they believe that
others would prefer them to perform the behavior (subjective norm), there will
be a greater intention (motivation) to behave in that manner and they are thus
more likely to do so (Udo et al., 2010). TPB adds one major predictor –
perceived behavioral control – “to account for times when people have
intention of carrying out a behavior, but the actual behavior is thwarted because
they lack confident or control over behavior” (Miller, as cited in Udo et al.,
2010). Along with these theories, TAM has been confirmed as the most popular
parsimonious framework used to explain customers’ behavioral intention. TAM
is model that explains user intention and behavior based on forward-looking or
prospective expectations about IT usage. This model found perceived
usefulness and perceived ease of use as salient beliefs influencing IS
acceptance behaviors across a broad range of end-user computing technologies
and user populations (Davis et al.; Mathieson; Taylor and Todd, as cited in
Bhattacherjee, 2001). However, many empirical studies also comparing the
11




relative effects of perceived usefulness and ease of use during pre-acceptance
and post-acceptance stages of IS use report that: perceived usefulness impacts
attitude substantively and consistently during both stages of IS use, and ease of
use has an inconsistent effect on attitude in the initial stages, which seems to
further subside and become non-significant in later stages (Davis et al.;
Karahanna et al., as cited in Bhattacherjee, 2001). Hence, studies base on TAM

to nowadays, perceived usefulness is usually used as direct variable influencing
on customer behavioral intention.
(2) Second stream is process-type models, mainly based on expectation-
confirmation theory (ECT) or expectation-confirmation model (ECM). This
stream had been developed from some limitations of TAM. It also uses
individual cognitive factors for predicting IS continued use. However, they
based on their backward-looking or retrospective perceptions grounded in
actual usage experience, such as performance, disconfirmation, and satisfaction,
in addition to initial expectations. (Premkumar, Bhattacherjee, 2008).






Source: Bhattacherjee, 2001
Figure 2.1: A post-acceptance model of IS continuance
In this model, consumers’ intention to repurchase a product or continue service
use is determined primarily by their satisfaction with prior use of that product or
service (Anderson and Sullivan 1993; Oliver 1980, 1993, as cited in
Bhattacherjee, 2001). Satisfaction is viewed as the key to building and retaining
a loyal base of long-term consumers and confirmed in many studies. Until
today, this stream develops widely in the consumer behavior literature to study
consumer satisfaction, post-purchase behavior and service marketing in general
Perceived
Usefulness
Satisfaction
Confirmation
IS continuance
Intention

12




(Anderson and Sullivan; Dabholkar et al.; Oliver; Patterson et al.; Tse and
Wilton, as cited in Bhattacherjee, 2001). Many researches try to add new
construct, and integrate studies that combine these models and another theory or
model.
In addition to the mainstream researches, there is a recent focus on affective
factors. According to Lee & Kwon (2011), the factors suggested classified into two
categories: cognitive and affective. Cognitive factors are those related to the mental
process of knowing, including aspects such as perception, reasoning and judgment.
Representative cognitive factors are: perceived usefulness, satisfaction, trust,
perceived ease of use, security, confirmation and disconfirmation, perceived risk,
perceived switching cost… In contrast, affective factors are related to specific
emotions or states of feeling. Some affective factors are studied in recent years such
as perceived playfulness (enjoyment), pleasure, arousal, familiarity and intimacy. Lee
& Kwon (2011) also suggested that customer retention research has shifted its focus
from cognition-oriented factors to affective factors to explore more factors
influencing on customer behavior.
Table 2.1: Some integrated models of customer retention
Study Characteristics of the research model Research domain

Lin et al. (2005) Based on ECM: introduced
perceived playfulness as a
new factor
Web-portal
Thong et al. (2006) Based on ECM: introduce post-
adoption beliefs and

perceived enjoyment as new factors
Internet service
Limayen

and Cheung
(2008)
Based on ECM: adds IS habit as a new factor

Internet
-
based
learning
Atcharuyachanvanich et
al. (2006)
Based on ECM: adds customer loyalty as a new factor E-commerce
Min and Shenghua
(2007)
Based on ECM: adds perceived enjoyment as a new
factor
E
-

learning

Roca et al.(2006) An integrated study
that combines EDT model and TAM
model, adds perceived quality and perceived usability as
new factor
E- learning
Liao et al. (2007)

An integrated study that combines EDT model and the
theory of Planning Behavior, adds subjective norm as a
new factor
E
-
serv
ice

Chiu and Wang (2008)

An integrated study that combines United theory of
Acceptance and Use of Technology, adds subjective
task
value as a new factor
Web–
based learning
Source: Lee & Kwon (2011)
13




In general, researchers have integrated many other factors to create new framework
that will improve the explanatory and predictive power for explaining online
customer retention.
2.2.2.2 Online group-buying repurchase model:
Few studies have tested online repurchase intention in online group-buying
context. In 2010, Fan et al. has used model of Bhattacherjee adapted expectation-
confirmation theory (ECT) and integrates the technology acceptance model (TAM) to

theorize a post-acceptance model of IS continuance. In this study, relationship
between customer satisfaction, perceived usefulness and online group-buying
repurchase intention are confirmed. Simultaneously, role of price expectation is also
measured
In 2012, Tien et al. also do research about repurchase intention in online group-
buying context. They examine repurchase intention through relationship quality and
expectation – confirmation theory views though relationship quality is regarded as an
important factor in the relationship marketing literature. This study emphasize
satisfaction is a particularly important foundation for a successful long-term
relationship between customers and group-buying websites. Hand in hand with
satisfaction is trust of the second factor. Just like previous researches, satisfaction and
trust continue being the important of two influence factors. Satisfaction is a stronger
predictor of repeat purchase intention than trust; this is consistent with the study in e-
commerce (Deng et al., as cited in Tien et al., 2012). Trust has direct and significant
effect on satisfaction and repeat purchase intention. Moreover, the results of this
research also show that trust, perceived value and perceived quality are important
antecedents of satisfaction. Among these factors, perceived quality is highly
influential determinant of perceived value and indirectly affecting repeat purchase
intention through satisfaction.
In the same year, Liu and Wu also study relationship between service quality,
word-of mouth, customer satisfaction, promotional incentive, and customer
14




satisfaction. This study show that service quality has strong effect on customer
satisfaction, thus, indirectly influence to customer loyalty.
In summary, very little studies in online group-buying context focus on customer
buying behavior, especially, customer retention. While the online market is growing

and profitable, the competition for market share is also increasing. To remain
competitive, it is imperative for online providers to invest time and money to find out
strategy to keep existed customers. Studies of customer retention are really necessary
for development of online group-buying model in the future.
2.2.3 Website quality:
Quality is not a new concept in information systems management and research.
Information systems practitioners have always been aware of the need to improve the
information systems function so it can react to external and internal pressures
and face the critical challenges to its growth and survivability (Aladwani & Palvia,
2002). However, to nowadays, both the conceptualization and the measurement of
website quality have been two debated topics.
In study of Éthier et al. (2006), research on the concept of website quality can be
classified broadly into four complementary research categories. (1) The first focuses
on functionalities and/or content of website. The dimensions identified have generally
been: functional issues, navigation, content, technical issues and contact information
(2) The second category includes researches affected by technology acceptance model
TAM, relationship between perceived ease of use and perceived usefulness can be
seen as a relation of quality. Information quality, system quality and service quality of
websites are the essential components of website quality. (3) The third category
includes studies that highlight service quality as a fundamental aspect of the overall
quality of a website. E-service quality and website quality sometimes are use
exchangeable. Many researchers try to make conceptualization of service quality of
website, for instance, Zeithaml (as cited in Li, 2010) defines e-service quality as the
extent to which a website facilitates efficient and effective shopping, purchasing and
delivery of goods and services; Santos (as cited in Udo et al., 2010) defines e-service
15

quality is the overall customer perceptions, judgments and evaluations of the quality
of service obtained from a virtual marketplace. These concepts are used popular and
developed from time to time. However, this category still faces many debates. (4) The
fourth category is composed of authors who believed that the principal criterion for
website quality was defined by customers' perceptions of quality. For example,
Huang (as cited in Éthier et al., 2006) describes website quality as whether the
website meet and/or exceeded expectations in terms of information and enjoyment
position; Wan (as cited in Éthier et al., 2006) states that the quality of a website was
based on: information, friendliness, responsiveness and reliability.
Like concepts of website quality, many instruments that combine the diverse
aspects of website quality have also been proposed (see in appendix A). Some
instruments combine traditional service quality dimensions and web interface quality
dimensions as the point of departure. For instance, in 2000, Loiacono et al. proposed
WEBQUAL, includes: ease of understanding, intuitive operation, informational fit-to-
task, tailored communication, trust, response time, visual appeal, innovativeness,
emotional appeal, online completeness, relative advantage, and consistent image.
After that, Yoo & Donthu (2001) measures website quality by SITEQUAL scale with
12 dimension: aesthetic design, competitive value, ease of use, clarity of
ordering, corporate and brand equity, security, processing speed, product
uniqueness, and product assurance quality. Aladwani and Palvia's (2002)
instrument focuses on website design and content. It used four dimensions: specific
content, content quality, appearance, and technical adequacy.
With the growth of recognition of different variability in the outcome of measuring
website quality, many studies show more different dimensions in website quality, for
examples: Madu &Madu (2002, as cited in Li & Suomi, 2009) develop a 15
dimensions scale of website quality, which is built on better understanding of
customers and providing services to meet the needs and expectations of customer;
Field et al. (2004, as cited in Li & Suomi, 2009) develop process model for assessing
and improving website quality by identifying e-service system entities and
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transactions between those entities and mapping key quality dimensions onto them.
Most recently years, Sohn & Tadisina (as cited in Li, 2010) proposed six dimensions
to measure website quality, include: trust, speed of delivery, reliability, ease of use,
customized communication, website content and functionality.
Among studies of website quality instruments, most researchers develop adapted
website quality scales based on the modification of the SERVQUAL instrument.
SERVQUAL scale is measurement scale had been used widely to measure service
quality with five dimensions: tangibles, reliability, responsiveness, assurance, and
empathy (Iwaarden, Wiele, as cited in Li, 2010). When adapting to e-commerce
context, Zeithaml (2000, as cited in Li & Suomi, 2009) proposed a 7-dimension
website quality scale. Later, Panasuraman et al. (2005, as cited in Liu & Wu, 2012)
developed it into seven constructs divided into two groups, includes: core e-SQ:
efficiency, fulfillment, availability, privacy; recovery e-SQ: responsiveness,
compensation and contact. To nowadays, these instruments is used popular in many
studies because it offers the surface dimensions of e-service quality based on
customers’ experience and evaluation perspective, which are viewed also as the
antecedents to the adoption of e-service (Rowley, as cited in Li & Suomi, 2009).
In general, website quality concept remains underdeveloped and is a vastly
undefined concept. This is a complex concept which has multiple dimensions.
Although recently, research on website quality has adopted a much broader scope on
website quality compared to its past focus on usability and interactivity. However, to
nowadays, there is no consensus on a definition on it. This topic is still a promising
field for researchers.
2.3 Research model:
This study adapted literature reviews of customer retention in online shopping and
online group-buying context. However, the advancement of many preliminary model

of human behavior required additional theoretical refinement and empirical testing in
order to improve its robustness and predictive ability across a wider range of contexts
(Li, 2010). Hence, some modifications and extensions to the original model were