The influence of employee service on positive word of mouth and repurchase intention in vietnam supermarket sector

UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business
-----------------------

Nguyen Duy Tan

The influence of Employee Service
on Positive Word of Mouth
and Repurchase Intention
in Vietnamese supermarket sector

MASTER OF BUSINESS (Honours)

Ho Chi Minh City – 2014


UNIVERSITY OF ECONOMICS HO CHI MINH CITY
International School of Business
----------------------------

Nguyen Duy Tan

The influence of Employee Service
on Positive Word of Mouth
and Repurchase Intention
in Vietnamese supermarket sector
ID: 20110053

MASTER OF BUSINESS (Honours)

SUPERVISOR: NGUYEN HUU LAM

Ho Chi Minh City - 2014


ACKNOWLEDGEMENT
At the first time of writing an academic paper, my thesis could not be finished without
guides and helps. From the bottom of my heart, I really want to write my sincere words
as follows.
Firstly, I would like to thank Dr. Nguyen Dinh Tho and Dr. Nguyen Huu Lam. I
wouldn’t know how to start, how to conduct and how to write my thesis without
guiding of them. Dr. Tho showed me the way and Dr. Lam helped me to walk on that
way. I would also thank Dr. Nguyen Thi Mai Trang, who always answered my emails,
explained all of my confusions.
I would like to express my deep gratitude to Mr. Douglas Foster for supporting online
journal articles. I wouldn’t have enough academic materials to write chapter two
without his help. He was not only a great teacher but also a good friend to me. I am
truly grateful to him for being my lecturer.
Also, I want to express my thanks to my classmates, Nguyen Thi Tuyet Oanh and Thai
Van Trung Hieu. They did supported me whenever I needed them. Honestly, if they
hadn’t been my friends, I couldn’t have finished my thesis in this year.

Finally, I would like to thank all of participants in this research, especially in-service
training students of ISB. Thanks a lot for their precious time to join the surveys of this
research.

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ABSTRACT
Supermarket sector have been one of the most attractive field of Vietnamese economy

in the last ten years. The success of a supermarket mainly depends on customer
repurchase intention and positive word of mouth that the supermarket gains from
current customers. Employee service and customer satisfaction are critical factors
which impact on repurchase intention and word of mouth.

Nevertheless, little

research has investigated the relationship of those concepts. This research examines
those relationships. Using a data set from a sample of 175 consumers, we found that
employee service influences on customer satisfaction and customer satisfaction
impacts on both repurchase intention and positive word of mouth. These findings
suggest that in order to accomplish the success of a supermarket, we must improve
employee service. Once we increase employee service, customer satisfaction is
increased. It influences repurchase intention and positive word of mouth. In short,
employee service is a very important factor that supermarket managers need to
improve.

Keywords: Customer repurchase intention, positive word of mouth, employee service
and customer satisfaction, supermarket.

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TABLE OF CONTENTS
CHAPTER 1: INTRODUCTION ................................................................................... 1
1.1.

Research background .............................................................................................................. 1

1.2.

Research problem.................................................................................................................... 2

1.3.

Research questions .................................................................................................................. 4

1.4.

Research scope ........................................................................................................................ 4

1.5.

Research methodology ............................................................................................................ 4

1.6.

Research contribution ............................................................................................................. 5

1.7.

Thesis structure ....................................................................................................................... 6

CHAPTER 2: LITERATURE REVIEW AND HYPOTHESES..................................... 8
2.1. Introduction .................................................................................................................................. 8
2.2. Employee Service ........................................................................................................................ 8
2.3. Positive Word of Mouth............................................................................................................. 10
2.4. Repurchase intention .................................................................................................................. 11
2.5. Customer satisfaction ................................................................................................................. 12
2.6. Hypotheses ................................................................................................................................. 13

2.7. Summary .................................................................................................................................... 16

CHAPTER 3: METHODOLOGY ................................................................................ 17
3.1. Introduction ................................................................................................................................ 17
3.2. Research process of this study ................................................................................................... 17
3.3. Measurement scales ................................................................................................................... 20
3.4. Qualitative Research .................................................................................................................. 21
3.4.1. The purpose of this qualitative research.................................................................................. 21
3.4.2. Sample of this qualitative research ......................................................................................... 22
3.4.3. The conduct of this qualitative research.................................................................................. 22
3.4.4. The outcome of this qualitative research ................................................................................ 23
3.5. Sample and data collection of pilot survey and main survey ..................................................... 24
3.5.1. Sample..................................................................................................................................... 24
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3.5.2. Data collection ........................................................................................................................ 25
3.6. The results of Pilot Survey ......................................................................................................... 25
3.6.1. Reliabilty Analysis - Cronbach’s alpha Testing...................................................................... 25
3.6.1.a. Employee Service testing. .................................................................................................... 27
3.6.1.b. Customer Satisfaction testing............................................................................................... 28
3.6.1.c. Positive Word of Mouth testing. .......................................................................................... 28
3.6.1.d. Repurchase Intention testing. ............................................................................................... 28
3.6.2. Exploratory Factor Analysis (EFA). ....................................................................................... 29
3.7. Summary .................................................................................................................................... 31

CHAPTER 4: DATA ANALYSIS AND RESULTS .................................................... 33
4.1. Introduction ................................................................................................................................ 33
4.2. Sample Characteristics ............................................................................................................... 33
4.3. Confirmatory factor analysis (CFA) .......................................................................................... 36

4.3.1. CFA of Employee Service (items: es1, es2, es3, es4, es5, es6) .............................................. 36
4.3.2. CFA of Customer Satisfaction (items: cs2, cs3, cs4, cs5) ...................................................... 37
4.3.3. CFA of Positive Word of Mouth (items: wm2, wm3, wm4, wm5, wm6) .............................. 38
4.3.4. CFA of Repurchase Intention (items: ri1, ri2, ri3, ri4, ri5) ..................................................... 39
4.4. Saturated Model ......................................................................................................................... 40

CHAPTER 5: CONCLUSION, IMPLICATION AND LIMITATION ........................ 46
5.1. Conclusion ................................................................................................................................. 46
5.2. Implication ................................................................................................................................. 48
5.3. Limitation and future research ................................................................................................... 49

REFERENCES ............................................................................................................. 51
Appendix 1: Qualitative result – Table 3.1 .................................................................. 55
Appendix 2: Pilot survey results – EFA first time running .......................................... 57
Appendix 3: Pilot survey results – EFA fifth time running (last time) ........................ 59
Appendix 4: The results of covariance and correlation ................................................ 60
Appendix 5a: Questionnaire in Vietnamese ................................................................. 61
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Appendix 5b: Questionnaire in English ....................................................................... 65

LIST OF TABLES
Table 3-2: Reliability result of pilot survey ................................................................. 26
Table 3-4 Pattern Matrixa ............................................................................................ 30
Table 4-1: Descriptive Statistics ................................................................................... 33
Table 4-4: Regression Weights: (Group number 1 - Default model) ........................... 42
Table 4-5: Standardized Regression Weights: (Group number 1 - Default model) ..... 43

LIST OF FIGURES

Figure 1: Conceptual Model ......................................................................................... 15
Figure 2: Research Process ........................................................................................... 19
Figure 3: Result of Employee Service CFA ................................................................. 37
Figure 4: Result of Customer Satisfaction CFA ........................................................... 38
Figure 5: Result of Positive Word of Mouth CFA ....................................................... 38
Figure 6: Result of Repurchase Intention CFA ............................................................ 39
Figure 7: Result of Saturated Model ............................................................................ 41
Figure 8: Structural Results (Standardized estimates) ................................................. 44

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CHAPTER 1: INTRODUCTION
1.1.

Research background

In recent years, the Vietnamese retail market has developed significantly in
comparison with previous decades. According to IIB’s analysis on November 2012,
sales in the retail industry had been increasing on an average of 27% per year from
2005 to 2011. International retailers, such as Big C, Metro, Lotte Mart, have come to
Vietnam. Coop Mart, a domestic retailer, has also expanded very quickly. Also,
retailing continues to transform Vietnamese economics with domestic consumption as
a primary focus. Additionally, retailing has enabled the opening of doors to
international investors because of the young population and the continuously
urbanizing process. This trend should favour continued growth in retailing over the
long term (A.T. Kearney, cited by Nguyen, 2010).
Despite the fact that Vietnam has fallen from first place in 2008 to 6th place in 2009,
14th in 2010, 23rd in 2011, and 32nd in 2012 according to the annual reports of
Global Retail Development Index, with improved growth forecasts in both GDP and

disposable income, Vietnam still remains an attractive market for global retailers.
Furthermore, according to Vietnam’s WTO commitments, effective January 11, 2015,
Vietnam has to allow the establishment of 100% foreign-invested retail organizations.
Casino, owner of the Big C supermarket chain, has developed its number of
supermarkets in Vietnam to 24. Casino plans to open five supermarkets and shopping
centres annually over the next three years. Meanwhile, Germany’s Metro Cash &
Carry Vietnam now operates 19 stores nationwide, a number expected to rise to 30-35
over the next three to five years. In short, the Ministry of Industry and Trade estimates

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that by 2020, Vietnam would host some 1,200 to 1,300 supermarkets, and more than
300 shopping centres. (Nguyen, 2013)
Apparently, the Vietnamese retail market is very competitive and is set to explode to
develop in the next years.
1.2.

Research problem

Theoretically, retailers have many choices to implement strategies attracting
consumers to come to their supermarkets and spend their money on their goods and
services; for instance, they are strategies of promotion, service and price. However,
the answer for efficiency of those strategies is not really clear in Vietnamese context.
The truth is not everyone spends money when they come to these shopping places.
Consumers who buy at a store one time doesn’t mean that they will surely buy
something in the future. Some of them will buy, some will just look at products and
not buy, some will never come back, etc. Some will talk to others about the
supermarket in a favourable way while others will talk negatively about their shopping
experience. There are plenty of things that could affect the success of a supermarket.

Retailers need to understand their customer attitudes and behaviours in order to come
up with appropriate strategies. In the international academic arena, there are many
research projects related to these issues. It is about four concepts: repurchase
intention, word of mouth, employee service and customer satisfaction.
Recently, in the past four years, there were a lot of complaints from consumers to
employee of supermarkets in Vietnam. These complaints have been printed in the
newspaper. Supermarket managers had to admit that their employees were wrong and
would be punished. However, these incidents have influenced future customer

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behaviour. This influence needs more research in order to show its importance to
those managers who are in charge of planning strategies for supermarkets. This study
focuses on observing the important role of employee service on related concepts
mentioned above.
Customer repurchase intention is critical to a store’s profitability (Jones and Sasser,
cited in Kuo, Hu & Yang, 2013, p.170). Therefore, the retailer can earn repurchase
intention of its customers by providing the customer what they want in terms of
products and services.
Katz and Lazarsfeld (1955) believed that word of mouth (WOM) was seven times
more effective than newspaper ads while Day (1971) estimated that WOM was nine
times more effective than advertising in changing consumer attitudes, and Morin
(1983) showed that “other people’s recommendations” were three times more
effective in terms of stimulating purchases of over 60 different products than was
advertising (cited by Goyette et al., 2010).
Yoo et al. (as cited in Nguyen, 2011) found that personal service has a direct effect on
consumer in-store emotion and indirectly creates consumer store attitude. Retailers
easily lose customers to their competitor because of doing poorly in this area of
providing service.

Anselmsson (2006) supplemented that satisfaction is a crucial issue for both customer
and retail management (cited in Theodoridis and Chatzipanagiotou, 2008).
Due to these important roles mentioned above, it is now necessary to do research on
these four concepts that contribute to the overall study in the Vietnamese retail
industry.

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1.3.

Research questions

In this study, Employee Service is researched to identify the influence on Customer
Satisfaction, Positive Word of Mouth and Repurchase Intention.
The idea of this research is to focus on the impact of Employee Service on Repurchase
Intention and Word of Mouth. There are 5 research questions that need to be
answered:
-

Does Employee Service have a direct impact on Positive Word of Mouth?

-

Does Employee Service have a direct impact on Repurchase Intention?

-

Does Employee Service have an impact on Customer Satisfaction?

-

Does Customer Satisfaction have an impact on Positive Word of Mouth?

-

Does Customer Satisfaction have an impact Repurchase Intention?

1.4.

Research scope

According to GfK retail census 2010, Ho Chi Minh City contributed 35% of modern
trade retail sales (cited in Nguyen, 2011, p. 4). This study concentrates on those
supermarkets in Ho Chi Minh City, the biggest city and commercial centre of
Vietnam. It investigates seven supermarkets which are located in Ho Chi Minh City:
Coop Mart, Maximark, Big C, Lotte, Metro, Citimart and Vinatex mart. Respondents
in this research are those shoppers who live in Ho Chi Minh City and are more than 18
years old.
Consequently, the result of this study may not be the typical result of the general
Vietnamese market.
1.5.

Research methodology

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The study consists of 3 phases: the qualitative research, the pilot survey and the main
survey. The qualitative research is carried out by in-depth interviews. It is to test the

items in order to appropriately apply to the Vietnamese market. The pilot survey is
leads to data which is used for Cronbach’s Alpha and EFA to test the scales. It is
undertaken by handing out hard copies to participants. The main survey results from
the data which is used for CFA to test the scales again and for SEM to test the
hypotheses. It is conducted by handing out hard copies and sending emails. Detail of
these researches is written in chapter 3 of this paper.
1.6.

Research contribution

This study demonstrates the important role of employee service on successfulness of a
supermarket by showing its impact on word of mouth and repurchase intention. Based
on this demonstration, supermarket managers have more information to focus on
employee service to win customers.
Academically, there have been many studies on the Vietnamese retail industry.
Nguyen Dinh Tho and Nguyen Thi Mai Trang conducted a research named
“Measurement of Service Quality of Supermarkets in Vietnam – A Customer
Perspective” in 2003. Four year later, they continued this study on “Hedonic shopping
motivations, supermarket attributes, and shopper loyalty in transitional market”.
Following that direction, Nguyen Nhu Chang studied on store attributes of Metro
Cash and Carry Vietnam in 2010, Nguyen Van Cuong researched the impact of store
images on loyalty in consumer electric stores in 2011, and Lam Hoang Vu tested the
same model of stores images on loyalty in the supermarket sector with their thesis
‘Antecedents of Shopper Loyalty in the Vietnamese Supermarkets’ in 2012, etc.

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However, these studies haven’t mentioned Word of Mouth concept, which plays
important roles in a successful retail business. This study investigates the impact of

employee service and customer satisfaction on positive word of mouth. As a result, it
gives retail managers alternative ways to do marketing outside of 4Ps strategies. When
4Ps strategies are not different from competitors or are too expensive, improving
service quality or customer satisfaction is a good choice to do marketing. Positive
word of mouth is an effective tool in expanding the brand and increasing revenue.
Even though there are a lot of researches studying shopper loyalty and loyalty
involving repurchase intention, the investigation of customer repurchase intention still
contributes to the academic side of the study. It updates the changes in Vietnamese
shopper attitude since the time after those previous researches. Moreover, repurchase
intention definition is also wider than loyalty definition in the aspect of a shopper.
Repurchase intention includes the shoppers who are not loyal to a shop but willing to
purchase again in that shop. This kind of shopper accounts for a significant volume of
sales turnover. Therefore, the study provides another view of shopper attitude and
then, retail managers have more information to make logical decisions.
1.7.

Thesis structure

This thesis is organized in five chapters as follows:
Chapter 1 introduces briefly about the research background and states the research
problem. Based on thiss, the research question is provided. Research scope,
methodology and contribution of this study are clearly stated.
Chapter 2 provides literature review of the four concepts in order: Employee Service,
Positive Word of Mouth, Repurchase Intention, and Customer Satisfaction. While the

6


definitions are reviewed, the relationships are also concluded based on previous
academic researches.

Chapter 3 explains methodology in detail. It presents the process of this study, sample
of respondents, collection method. Also, it gives academic reasons why these
particular methods were chosen. Furthermore, it includes results and analysis of the
qualitative research.
Chapter 4 reports the results of the pilot survey as well as the main survey. It gives
detailed analyses of Cronbach’s alpha, EFA, CFA and SEM test. Finally it concludes
the relationships between the four concepts.
Chapter 5 summarizes the findings and concludes the research model based on the
results in chapter 4, then gives implications to retail managers. Finally, the limitations
of this study are clearly stated and future researches are suggested.

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CHAPTER 2: LITERATURE REVIEW AND HYPOTHESES
2.1. Introduction
Chapter 1 has pointed out four concepts needed to be reviewed: Employee service,
positive word of mouth, repurchase intention, and customer satisfaction. In this paper,
customer satisfaction, positive word of mouth and repurchase intention are reviewed
by international previous researches. Employee service is based on both international
and Vietnamese researches. After reviewing literature of those concepts, relationships
of them are analysed and predicted by findings of those previous researches.
2.2. Employee Service
According to Martineau (cited in Nguyen, 2011), employee service is described as
sales personnel service. Shoppers have randomly evaluated the sales personnel in their
regular purchases at some retailers.
Lindquist (1975) stated that employee service is one critical part of store service.
(cited in Nguyen, 2011). In order to clearly define employee service, the service
quality of a store needs to be reviewed.
The firm’s ability to create and provide a high level of quality service is a key to

sustaining competitive advantages. The intangibility nature of service, however,
makes it hard to set standards (Yoo and Part, 2007, p.911). That explains the truth
about how service quality has been discussed over the past decades. During these
decades arguing about service quality, SERVQUAL of Parasuraman is the most
widely-known scale of service quality in the world (Siu and Cheung, 2001; Yoo and
Park, 2007; Ganguli and Roy, 2010; Nguyen and Nguyen, 2011). SERVQUAL

8


consists of 5 dimensions: tangibles; reliability; responsiveness; assurance; empathy.
(cited by Ladhari, 2009, p. 174).
However, service quality is not the same in different kinds of service and different
markets (Nguyen and Nguyen, 2011). In the international retail industry, there are
three researches (in USA, Hong Kong, and Singapore) which thoroughly studied the
service quality concept. Dabholkar et al. (1996) developed a scale named the Retail
Service Quality Scale. It includes five dimensions: physical aspects; reliability;
personal interaction; problem solving; policy (as cited in Siu and Cheung, 2001, p.
89). Later on, Mehta et al. (2000) studied in Singapore and revealed a modified scale
that included 5 dimensions: service personnel; physical aspects; merchandise;
confidence; and parking. After that, Siu and Cheung (2001) applied the Dabholkar
model to the Hong Kong retail market and proposed 6 dimensions of retail service
quality: personal interaction; policy; physical appearance; promises; problem solving;
and convenience.
In the details, Dabholkar defined that “personal interaction” also involved two subdimensions: service personnel inspiring confidence, trust and being courteous/helpful.
Helpfulness/courteousness referred to the friendliness of the store personnel and the
ability to be of help when needed (cited in Mehta, 2000). Dabholkar also defined
“Problem solving” that employees are trained to handle potential problems, such as
customer complaints, returns and exchanges. (cited in Siu and Cheung, 2001). Siu and
Cheung explored more dimensions, but it is still the same definition of “problem

solving” and “personal interaction”, whereas Mehta collected “problem solving” and

9


“personal interaction” into one dimension “Service personnel”, which is service
related to personnel.
In the context of Vietnam, Nguyen and Nguyen (2003) found all significant
dimensions of service quality in all aspects of a Vietnam supermarket, they are 5
dimensions: merchandise, service capability of employees, display of goods, store
layout, safety of store. Like Mehta (2000), the dimension of “service capability of
employees” is the only one which concerns employees, but it is more appropriate for
future Vietnamese researches because it is in the same context. Service capability of
employees was defined as “the capability, personality, and attitude of supermarket
employees in servicing customers” (Nguyen and Nguyen, 2003). That is the definition
of “Employee Service” in this study.
2.3. Positive Word of Mouth
Word-of-mouth (WOM) is probably the oldest means of exchanging opinions on
various goods and services offered by markets (Goyette et al., 2010, p.6). The
extremely important role of WOM was confirmed by many researchers long time ago:
Katz and Lazarsfeld (1955), Day (1971) and Morin (1983) (cited by Goyette et al.,
2010).
WOM has been recognized as an important factor influencing consumer decisionmaking (Xuehua Wang, 2011). In today’s virtual arena, the power of word-of-mouth
has grown exponentially (Goyette et al., 2010). Apparently, retailers have effective
WOM from current customers, they can easily and cheaply win new customers.
WOM was defined as the informal communication to evaluate products/services
between private parties (Anderson, 1998, cited by Xuehua Wang, 2011), excluding

10

formal contacts and/or communications between consumers and a firm such as
complaints, promotions, and seminars. Typically, WOM is either extremely positive
or abominably negative, together with vivid and memorable experiences,
recommendation, or complaints and rumor in the case of negative WOM (Anderson,
1998; Herr et al., 1991, cited by Xuehua Wang, 2011).
(Goyette et al., 2010, p.9) summarized WOM as “a verbal informal communication
occurring in person, by telephone, email, mailing list, or any other communication
method regarding a service or a good”.
In 2001, Harrison-Walker (as cited in Goyette et al., 2010) focused on four aspects of
WOM: (1) frequency, (2) number of contacts, (3) detail, and (4) word-of-mouth
praise. Further refinement of this measurement scale led Harrison-Walker to retain
only two primary WOM dimensions: word-of mouth praise with two items and wordof-mouth activity with four items. Goyette et al. (2010) also reviewed that researchers
verified whether conversations were positive or negative, or whether they reflected
satisfaction or dissatisfaction with respect to a product or a service. The dimension
“positive valence” reflects praise, while “negative valence” remains to be explored.
Furthermore, File and Prince (1992, p. 25) stated that customers are known to engage
in positive word of mouth, that is they will tell others who were external to the
transaction of their pleasure with the service and the service provider.
In this study, Positive Word of Mouth is defined as the “positive valence” dimension.
Positive Word of Mouth (PWOM) represents the positive things a customer talks
about a supermarket.
2.4. Repurchase intention

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Repurchase intentions represent the customer’s self-reported likelihood of engaging in
further repurchase behavior (Seiders et al, cited in Shahrokh et al. 2013). Actually,
repurchase intention led to customer returning for buying again, in the medium-term

or long-term (Zhang et al, cited in Shahrokh et al. 2013). In another study, repurchase
intention is defined as the degree to which customers are willing to purchase the same
product or service and it is a simple, objective, and observable predictor of future
buying behavior (Jones and Sasser, cited in Kuo et al., 2013).
In the scope of this study, repurchase intention is defined as the subjective probability
that an individual will continue to purchase products from the store in the future”
(Fang, Chiu and Wang, 2011, p. 484).
2.5. Customer satisfaction
Satisfaction is a crucial issue for both customer and retail management. It is an
important concept within general retail marketing and consumer research.
(Anselmsson, as cited in Theodoridis and Chatzipanagiotou, 2008).
Researchers have defined satisfaction diversely (Molinari et al., 2008). Customer
satisfaction depends on a product’s perceived performance in delivering value relative
to a buyer’s expectations. If the product’s performance falls short of the customer’s
expectations, the buyer is dissatisfied. If performance matches expectations, the buyer
is satisfied. If performance exceeds expectations, the buyer is delighted (Kotler,
Armstrong, Saunders and Wong, 1999, p. 12).
In Vietnam, Nguyen Thi Tuyet Hong (2012) stated in the research of customer
satisfaction that Oliver (1997) assumed “customer satisfaction is a judgment that a
product or service feature, or the product or service itself, provided (or is providing) a

12


pleasurable level of consumption-related fulfilment, including levels of under or over
fulfilment”.
Cadotte et al. (as cited in Molinari et al., 2008) defined satisfaction as an emotional
response. While Bolton and Drew (1991) and Boulding et al. (1993) identified “two
main types of satisfaction: the “transaction-specific” and the “overall” or cumulative
satisfaction” (cited by Theodoridis and Chatzipanagiotou, 2008).

According to Theodoridis and Chatzipanagiotou (2008), “from the transaction-specific
perspective, customer satisfaction is viewed as a post-choice evaluation of a specific
purchase occasion” (Oliver, 1980, 1981); in contrast, the overall or cumulative
perspective suggests that satisfaction accumulates across a series of experiences with
the product, which results in an overall evaluation over time (Anderson et al., 1994;
Fornell, 1992)”.
Customer satisfaction in this study is defined as cumulative satisfaction, which is “the
result of evaluating the “shopping trip” and retailer’s offer in correlation to the
consumers’ fulfilled expectations” (Sivadas and Baker-Prewitt, as cited in Theodoridis
and Chatzipanagiotou, 2008, p. 712).
2.6. Hypotheses
When Harrison-Walker tested a scale to Word of Mouth in 2001, he revealed that
service quality is an antecedent of WOM. Furthermore, Pollack (2009) stated that
service quality is a significant predictor of word-of-mouth and intention to repurchase.
Also, Employee Service is a very important aspect of service quality. Therefore, it is
expected that Employee Service has positive impacts on Positive Word of Mouth and
Repurchase Intention. This leads to two hypotheses as follows:

13


H1. Employee Service has a direct positive impact on Positive Word of Mouth.
H2. Employee Service has a direct positive impact on Repurchase Intention.
About the relationship between service quality and customer satisfaction, Gronroos
(1983) stated that there is a significant overlap between service quality and customer
satisfaction, and thus, they can be used interchangeably (cited by Chang et al., 2008).
Several studies have shown that a high level of customer service quality can exert a
positive influence on customer satisfaction (Cronin and Taylor, 1992; Zeithaml et al.,
1996; Ramsaran-Fowdar, 2006, cited by Chang et al., 2008). Besides, in India, a
developing country like Vietnam, Bhaskar and Shekhar (2011) researched on the

influence of Service Quality on Customer Satisfaction in apparel retail market. The
study was finished and revealed that service quality factors significantly effects
customer satisfaction. Since service quality includes employee service, that leads to an
expected effect of Employee Service on Customer Satisfaction. Therefore, there is a
hypothesis can be proposed in Vietnamese supermarket sector:
H3. Employee Service has a direct positive impact on Customer Satisfaction.
Theodoridis and Chatzipanagiotou (2008) also reviewed that “customer satisfaction
has been shown to be a good predictor of future purchase behavior (Newman and
Webel, 1973; LaBarbera and Mazursky, 1983; Kasper, 1988). Sivadas and BakerPrewitt (2000) demonstrated that satisfaction influenced relative attitude, repurchase,
and recommendation. Highly satisfied customers are likely to make future purchases
(Zeithaml et al., 1996) and to recommend the source to other customers (Reynolds and
Arnold, 2000; Reynolds and Beatty, 1999)”.

14


In addition, Kotler et al. (1999, p.12) argued that satisfied customers make repeat
purchases, and they tell others about their good experiences. Thus, this leads to two
hypotheses that Customer Satisfaction has impacts on Repurchase Intention and
Positive Word of Mouth:
H4. Customer Satisfaction has a direct positive impact on Positive Word of Mouth.
H5. Customer Satisfaction has a direct positive impact on Repurchase Intention.
Figure 1: Conceptual Model

POSITIVE WORD OF
MOUTH

H1

H4

H3

EMPLOYEE SERVICE

CUSTOMER
SATIFACTION

H5
H2

REPURCHASE
INTENTION

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2.7. Summary
There are five hypotheses expected in this study. All of relationships are positive.
Especially, service quality is mentioned in this chapter to provide an overall view of
service in a supermarket. In Vietnamese market, employee service gets complaints the
most and it is a very important aspect of service quality. When a relationship exists
between service quality and another concept, it can possibly be expected that there is a
relationship between employee service and that concept.

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CHAPTER 3: METHODOLOGY
3.1. Introduction

The previous chapter suggested the research model with four concepts. This chapter
introduces the methods to do research in order to obtain data for analysing those
concepts and the model. Also, this chapter gives an order of those methods and
reasons for choosing them. It includes five sections: Research process, Measurement
scales, Qualitative research, Sample and data collection of pilot survey and main
survey, Results of Pilot survey.
The two important writings in this chapter are the results of qualitative research and
pilot survey. The result of qualitative research led to the final draft of the
questionnaire which was used in the pilot survey and the outcome of the pilot survey
resulted in the main survey of this study. However, the result of the main survey will
be presented in the next chapter.
3.2. Research process of this study
Literature review led to the conceptual model which includes 5 hypotheses with 4
concepts. Based on the four concepts and the existent academic scales, the first draft
of the questionnaire was written. Then it was edited in a qualitative research to
become a final draft questionnaire. In detail, the qualitative research consisted of indepth interviews with eight shoppers. The qualitative research verified potential
problems related to the items in the Vietnamese supermarket sector, checked the
grammar and word choice used in the first draft questionnaire and came up with the
final draft questionnaire.

17


The final draft questionnaire was asked in the pilot survey of which the result was
used to analyse the reliability of measurement scales. Reliability was tested by using
Cronbach’s Alpha. The items were tested for appropriate loading factors on their
constructs by using Exploratory Factor Analysis (EFA). Cronbach’s alpha was used
before analysing EFA in order to eliminate rubbish items. Otherwise, rubbish items
may create artificial factors (Nguyen & Nguyen, 2011, p.33). In short, Cronbach’s
Alpha and EFA analysis resulted in the official questionnaire. SPSS software was

used in this part of the process.
The official questionnaire was used to do the main survey. When the data of the main
survey had been collected, it was used to analyse reliability and validity by using
Confirmatory Factor Analysis (CFA). The model was tested by using Structural
Equation Modelling (SEM). CFA and SEM analyses yielded the conclusions reached
in this research. In this part of the process, AMOS was the software which the
researcher used.
The entire process is illustrated in the following chart:

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