i

Sheffield Business School

BSc (Honours) Hospitality Business Management

Title A study of the relationship between service quality and customer

satisfaction of Starbucks Coffee in Hong Kong Name Chan Ka Man Student No 9120 4646 Month Year April 2010

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Sheffield Hallam University

Sheffield Business School

Title A study of the relationship between service quality and customer

satisfaction of Starbucks Coffee in Hong Kong FULL NAME Chan Ka Man STUDENT No 9120 4646 Supervisor: Professor Ray Pine In partial fulfilment of the requirements for the degree of Bachelor of Science in Hospitality Business Management. Month Year April 2010

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Acknowledgements

Since there were lots of supports for me to complete this dissertation, hence, I would

like to acknowledge about their efforts.

Firstly, I would like to thank to Professor Pine, the supervisor of my project, for his

taught about the skills of writing the dissertation, recommendations, guidance and

assistance during the whole process of working in the project.

Secondly, I felt gratitude to the help of my previous colleagues who were working in

Starbucks Coffee. They provided lots of information about Starbucks Coffee to me.

Finally, I would like to thank my families and friends about their ideas, suggestions

and supports for me to complete my project. Moreover, I would like to thank for the

respondents who have participated in my survey that provided information for me to

have the analysis of the primary research.

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Abstract Since nowadays having customer satisfaction for hospitality industry, therefore most

organizations put lots of effort to understand their customers in order to gain their

satisfaction. Hence, this study was launched for the aim finding out the relationship

between service quality and customer satisfaction and find methods to enhance its

satisfaction. In this study, Starbucks Coffee was used as the example, within the

literature review, there would be explanations about the terms of service quality,

customers expectation, perception and satisfaction. Moreover, there would be an

introduction about the primary research. A survey was conducted to collect the

customer responds toward Starbucks Coffee in Hong Kong. Based on the result

analysis, there were some dimensions of service quality of Starbucks that could not

gain satisfaction. Therefore, at the end of the study, there would be some

recommendations for Starbucks Coffees improvements such as enhance their

appearance of store, provide more individual services.

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Table of Contents Page

Acknowledgements..iii Abstract....iv Table of contents..v-vii List of Figuresviii List of Tablesix Chapter 1 Introduction .1-6 1.1 Background Information .....1-2 1.2 Information of Starbucks Coffee

1.2.1 Background.3-4 1.2.2 Mission Statement..4

1.3 Aims...5 1.4 Objectives...5 1.5 Outline of the Study6 Chapter 2 Literature Review.7-25 2.1 Introduction7 2.2 Service8

2.2.1 The Definition of Service...8 2.2.2 Characteristics of Service..9-11

2.3 Quality..11 2.3.1 The Definition of Quality11-12

2.4 Service Quality.13 2.4.1 The Definition of Service Quality13 2.4.2 Service Gap Model..13-16 2.4.3 Measurement of Service Quality.16-20

2.5 Consumer Behavior..20 2.5.1 The Definition of Consumer Behavior.20 2.5.2 Expectation..21-22 2.5.3 Perception22-23 2.5.4 Customer Satisfaction...23

2.6 Relationship between Service Quality and Customer Satisfaction ..24

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2.6.1 Satisfaction versus Service Quality.24-25

2.7 Summary ..25 Chapter 3 Methodology26-35 3.1 Introduction..26 3.2 Primary Research26-27 3.3 Secondary Research 27 3.4 Research Methods27

3.4.1 Qualitative Research28 3.4.2 Quantitative Research.28-29

3.5 Design of Questionnaire 3.5.1 Structure..29-31 3.5.2 Hypothesis..31-32 3.5.3 Wording and Language.32

3.6 Sampling..32 3.7 Piloting.33 3.8 Data Collection..33-34 3.9 Data Analysis34 3.10 Limitations

3.10.1 Primary Research.35 3.10.2 Secondary Research.35

3.11 Summary..35 Chapter 4 Findings and Analysis36-61 4.1 Introduction..36 4.2 Demographic Profile of Respondents.37-39 4.3 Analysis of five dimensions of service quality40

4.3.1 Reliability40-42 4.3.2 Responsiveness...42-43 4.3.3 Assurance43-44 4.3.4 Empathy..45-46 4.3.5 Tangibles.46-47

4.4 Analysis of overall customer satisfaction...47-50 4.5 Factors analysis51

4.5.1 Expectation 4.5.1.1 Age group51-53 4.5.1.2 Occupation..53-54

4.5.2 Perception

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4.5.2.1 Gender.54-55 4.5.2.2 Average income rate56-57

4.6 Analysis of importance of five dimensions of service quality58-61 4.7 Summary..61 Chapter 5 Conclusion and Recommendations...62-66 5.1 Conclusion..62-63 5.2 Recommendations for Starbucks Coffee in Hong Kong..63

5.2.1 Reliability.64 5.2.2 Empathy64 5.2.3 Tangibles...65 5.2.4 Responsiveness.65

5.3 Further Research...66 Reference67-72 Appendices.. Appendix 1 - Questionnaire in English...73-76 Appendix 2 - Questionnaire in Chinese..77-79 Appendix 3 - Statistics of respondents expectation toward age group..80-81 Appendix 4 - Statistics of respondents expectation toward occupancy.82-83 Appendix 5 - Statistics of respondents perception toward gender.84-85 Appendix 6 - Statistics of respondents perception toward average income rate86-87 Appendix 7 Crosstabs analysis of respondents gender, age group and Level of importance of responsiveness..88

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List of Figures Page

Figure 2.1 Service Quality Model 14

Figure 2.2 Determinants of Perceived Service Quality 17

Figure 2.3 Possible Levels of Customer Expectations 22

Figure 2.4 Customer Perceptions of Quality and Customer Satisfaction 25

Figure 3.1 Types of Questionnaire 30

Figure 4.1 Compare mean in reliability dimension 42

Figure 4.2 Compare mean in responsiveness dimension 43

Figure 4.3 Compare mean in assurance dimension 44

Figure 4.4 Compare mean in empathy dimension 46

Figure 4.5 Compare mean in tangibles dimension 47

Figure 4.6 Overall mean of expectation and perception based on

five dimensions. 48

Figure 4.7 Level of importance based on five dimensions of service

quality 59

Figure 4.8 Distribution of gender toward level of importance of

responsiveness 60

Figure 4.9 Distribution of age group toward level of importance of

responsiveness 60

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List of Tables

Page

Table 2.1 Problems Created by the Unique Characteristics of Services 11

Table 2.2 The Five SERVQUAL dimensions categories 17

Table 3.1 Statements pertaining to the five dimensions 31

Table 3.2 The given questionnaires distribution 34

Table 4.1 Demographic profile of respondents 37

Table 4.2 Comparison of mean in reliability dimension 41

Table 4.3 Comparison of mean in responsiveness dimension 43

Table 4.4 Comparison of mean in assurance dimension 44

Table 4.5 Comparison of mean in empathy dimension 45

Table 4.6 Comparison of mean in tangibles dimension 47

Table 4.7 Comparison of overall mean of expectation and perception

based on five dimensions 48

Table 4.8 Statistics of respondents expectation toward age group 51

Table 4.9 Different mean of respondents expectation toward age group 52

Table 4.10 Statistics of respondents expectation toward occupation 53

Table 4.11 Different mean of respondents expectation toward occupation 53

Table 4.12 Statistics of respondents perception toward gender 54

Table 4.13 Different mean of respondents perception toward gender 55

Table 4.14 Statistics of respondents perception toward average income

Rate 56

Table 4.15 Different mean of respondents perception toward average

income rate 56

Table 4.16 Level of importance based on five dimensions of service quality 59

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Chapter 1 Introduction

1.1 Background Information

In the hospitality industry, the spending of customers are the main income of an

organization, therefore customers are always being the main important role for a

hospitality organization to run business nowadays. According to Glanz (1994), he stated

that it costs five times as much to acquire a new customer as it does to retain an existing

customer, since having customer satisfaction not only could capture new customers, but

also increase the chance of repeated business and hence, most organizations would put a

lot of effort to fulfill the customers perception and expectation in order to gain maximum

profit. Moreover, customer satisfaction is also a tool for an organization to enhance their

image and brand name in the market industry, from Chan and Baum (2007), he said

customer satisfaction is a key element for contemporary organizations to deliver high

quality products and service as well as to position firms competitively in the marketplace,

hence the more satisfying the customers, the easier to increase the market share and the

net profit of the business.

As customer satisfaction is depended on the service delivery provided among the

customers perception and expectation. One of the ways for hospitality organizations to

gain customer satisfaction is focus on their own service quality, which is an important

objective for companies to retain business in competitive environment nowadays. Due to

service quality could affect customer satisfaction, the higher service quality could help

easier to reach the customers needs and wants, and therefore, higher the customer

satisfaction. As a result, it could enlarge repeat purchase, positive word-of-mouth

communications that help the business to achieve higher sales revenues and market

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shares. And this is the reason why much more organizations are focusing on service

quality nowadays than previous times.

For the international brand, Starbucks Coffee Company, it was one of the 100 top brands

around the world (Anon, 2007); it had increased its rating from 91 to 88 since 2006 to

2007. In Hong Kong, Starbucks Coffee is one of the most popular coffee shops, most

people may think of Starbucks Coffee as the first idea after listened to the words of

coffee shop. Even though the average spending costs of Starbucks are not really low

that everyone could afford it, but there are still lots of guests in Starbucks all the time.

However, with the situation that more and more competitors nowadays, and the

competitions between Starbucks and other competitors would be intense and long-term

including the new competitors enter the market of coffee shops which could bring the

threats that affecting the market leader of Starbucks, therefore Starbucks always put lots

of efforts to satisfy their guests in order to deal with the problem, help keeping their

business and having competitive advantages by providing the guests high quality,

innovative and creative service.

In this study, it analyzed the service quality of Starbucks, how they would make use of

the service quality in order to gain the customer satisfaction. Also, it could show the

useful of understand the guests perceptions, expectations, providing suitable services and

products including the usage of the service gap and SERVQUAL models that help to have

customer satisfaction.

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1.2 Information of Starbucks Coffee

1.2.1 Background logo of Starbucks Coffee

About the name Starbucks, it was come from Herman Melvilles Moby Dick, a

class American novel about 19th Century whaling industry. It represented a store

that imported the worlds finest coffees to the cold, thirsty people of Seattle. The

logo was also inspired by the sea featuring a twin-tailed siren from Greek

mythology (Starbucks Coffee Company, 2010a). In 1971, the first Starbucks was

opened in Seattles Pike Place Market. During that period, Starbucks was only the

roaster and retail of whole bean and ground coffee, tea with a single store.

In 1982, Howard Schultz, the Chairman of Starbucks, joined Starbucks as director

of retail operations and marketing. The year after, Howard traveled to Italy and

became captivated with Italian coffee bars and the romance of the coffee

experience. He had a vision to bring the Italian coffeehouse tradition back to the

United States that was a place for conversation and a sense of community, a third

place between work and home. Moreover, in 1984, there was a test to the

coffeehouse concept in downtown Seattle, and the first Starbucks Caffe Latte was

served. And in 1987, Starbucks opened first stores outside of Seattle area in

Chicago and Vancouver.

Nowadays, Starbucks Coffee had more than 15,000 stores in 50 countries that is

the premier roaster and retailer of specialty coffee in the world.

In hong Kong, there was the first store launched at Centrals Exchanege Square in

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may 2000. Until now, Starbucks are now with more than 100 stores across Hong

Kong's commercial, shopping & entertainment and residential areas. (Starbucks

Coffee Company, 2010b)

1.2.2 Mission Statement

Starbucks treat themselves as the premier purveyor of the finest coffee in the

world while maintaining our uncompromising principles while they grow. And

there are six guiding principles which would help them to measure the

appropriateness of their decisions:

(1) Provide a great work environment and treat each other with respect and

dignity.

(2) Embrace diversity as an essential component in the way we do business.

(3) Apply the highest standards of excellence to the purchasing, roasting and fresh

delivery of our coffee.

(4) Develop enthusiastically satisfied customers all of the time.

(5) Contribute positively to our communities and our environment.

(6) Recognize that profitability is essential to our future success.

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1.3 Aims

The research aims was to study how the service quality of Starbucks Coffee Company in

Hong Kong influencing the customer satisfaction and how it could enhance customer

satisfaction through service quality enhancement. Thus, at the end of the research, it

could provide the importance of the link between the customer satisfaction and service

quality and the use of SERVQUAL model.

1.4 Objectives

In order to have the details information about the relationships between the service

quality and customer satisfaction, bellows are the objectives that should be carried out:

(1) To understand what customer satisfaction and service quality are and the relationships

between the two issues;

(2) To study how to measure customer satisfaction and service quality;

(3) To find out the difference between customers expectation and perception of service

quality in Starbucks; and,

(4) To provide recommendations that which dimension of SERVQUAL that Starbucks

should improve to gain customer satisfaction.

In this study, the first two parts of the objectives would be solved by the literature review

in Chapter 2, and the last two parts of the objectives would be solved by the quantitative

method which would be explained in chapter 3 and 4.

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1.5 Outline of the Study

There would be five chapters consisted in this study:

Chapter 1, Introduction, it stated the purpose of the study, the aims and objectives of the

study. It also included the outline of the study.

Chapter 2, Literature Review, it contained the background and the concepts that were

using by Starbucks Coffee in Hong Kong. Also, it included the review of customer

satisfaction, service quality, the relationship between them and the methods of the

measurement of customer satisfaction and service quality.

Chapter 3, Methodology, it was about the source of data collected, provides details of

primary and secondary research. It stated the process of data collection including the

methods used, design of the questionnaire, sampling in the survey.

Chapter 4, Findings and Analysis, it showed the findings and results of the primary

research. The data was analyzed by the Statistical Package for the Social Science (SPSS).

Chapter 5, Conclusion and Recommendations, this was the last part that contained the

conclusion which based on the findings of the research and review the research objectives

of the study. Also, there were recommendations suggested to Starbucks Coffee.

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Chapter 2 Literature Review

2.1 Introduction

The aim of this chapter is to provide a further understanding of the issues that the

research would mention about. Dees (1993) said that access to numerous resources will

ensure success in getting started and give you insight to the limitations and possibilities

of the research topic. Once you have a topic and can focus on a potential research

questions, your goal will be to locate appropriate numbers and types of sources to

investigate.(p.15), a literature review was needed in this study because it could help to

bring a step forward to the research question. In terms of White (2000), he defined that

literature was knowledge of whats gone before and would provide a state of-the-art

background. And literature review would help to discuss the study in the relevant

context, together with any theoretical frameworks which may be involved. It may also

trigger your imagination and help you set the work in a new and different light. (p.83)

According to the literature review in this study, it has divided into six parts by giving

general definitions of service, quality, and the terms of customer satisfaction and the

measurement of service quality. Lastly, there would be a summary at the bottom of the

chapter. By having tightly focused on those topics, it would be easier to understand the

link between those issues and helped to develop the ideas better.

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2.2 Service

Before having knowledge about the terms of service quality and customer satisfaction, it

was needed to understand the basic concept of service because there were special

characteristics of service. If there were more knowledge about service, it would be more

helpful to understand the whole study. Since from the chapter of background of Starbucks,

it showed Starbucks was an organization which focused on the customers and service,

therefore by the help of the study of service, the easier to analyze the service of

Starbucks in Hong Kong.

2.2.1 The Definition of Service

Lovelock, Wright (2002) have defined service as an action or performance which

offered by one party to another and services could be the economic activities

which create value and provide benefits for customers at specific times and places.

In addition, they gave out the example of how service industries contribute to the

economy of the United States relative to manufacturing, government, agriculture,

mining, construction, and business, etc. It could show that service has covered a

wide range of activities, most industries must involve service.

Besides, according to Buttle (1986), he pointed out service covers all those firms

and employees whose major final output is some intangible or ephemeral

commodity or, alternatively, that residual set of productive institutions whose final

output is not a material good. (p.5)

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2.2.2 Characteristics of Service

As service was totally different from the products that people could touch or see,

it was not easy to describe service in a concrete way. However, some special

characteristics of services would be mentioned below, therefore, it could

understand what service was in a more simple way.

Guiltinan, Schoell (1993) introduced that service was intangibility, perishability,

simultaneous production and consumption and lack of standardization. They said

that although some goods also have some of these characteristics, all services

have them. Each of these characteristics had important implications for the design

of marketing strategies.

Intangibility

It was the most common term to describe service. For intangible, it meant

services could not be seen, touched, felt, or otherwise sensed and it was not a

physical object. Moreover, it was generally difficult for the prospective customer

to evaluate a service in advance.(Guiltinan, Schoell, 1993)

Perishability

For the second characteristic, services were perishable which meant they could

not be saved, inventoried, returned or resold. For example, for the airliner took off

for its destination, the empty seats could not be reclaimed. It may lead to

difficulty in balancing supply and demand for the organizations, many service

providers find it too costly to offer levels of service that would match peak

demand, hence strategies must be prepared in order to minimize the things go

wrong. (Guiltinan, Schoell, 1993)

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Simultaneous production and consumption

About the third characteristic, for most service, production and consumption

occur simultaneously, most produces were depended on the consumers. Thus the

consumer became involved in the production process to some extent, and in many

cases the individuals involved in producing the service were the same people who

serve as the sales force. (Guiltinan, Schoell, 1993)

Lack of standardization (Heterogeneous)

The last characteristic of service was the lack of standardization. It was difficult

to achieve for service providers to measure the level of quality and had the

consistent quality. It was because the precise needs of the customers receiving the

service were slightly different. This was an especially important problem when

the essence of the service depends on contact personnel, since the performance of

individuals was bound to fluctuate from day to day and from client to client.

(Guiltinan, Schoell, 1993)

Form Table 2.1, it showed the sum up of the problems which created by the

unique characteristics of service. Since there would be problems occurred all the

time, therefore, understanding the meaning of service was necessary which could

help to develop solution or strategies to solve those problems.

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Table 2.1 Problems Created by the Unique Characteristics of Services Characteristic Problems

Intangibility Difficult to demonstrate benefits, reputation

Perishability Inability to build inventory Customer dissatisfaction from waiting

Simultaneous production and consumption

Producers of services are also marketers Potential for locational inconvenience

Lack of standardization (Heterogeneous)

Inconsistent quality

Source: Guiltinan, Schoell (1993), p.264

2.3 Quality

It was stated that nowadays customers were becoming critical about the quality of service

they experience. (Albrecht and Zemke, 1985) Hence, it was important to have a study

about the term of quality in order to attract more customers for the business. In this part,

it would help to understand the basic concept and characteristic of quality, and therefore,

it could have a further study in the service quality that help to measure and analyze the

service quality of Starbucks.

2.3.1 The Definition of Quality

According to Brown, et. al. (1991), quality in service was difficultly to define

because of the intangible nature of the service offering. The definition of quality

may vary from person to person and from situation to situation (p.1)

However, From Gummesson, et. al. (1996), they mentioned the definitions of

quality had become increasingly sophisticated during the past two decades.

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According to Thomas (1965), The concept of quality as excellence has now

been largely superseded by definitions emphasizing production or delivery

contexts. Such definitions as conformance to requirements(p.5) or even zero

defects (Gregory, 1972) relate quality to match between product and

manufacturing specification.(p.61) In addition, Johnson, Weber (1985) said that

an understanding of the meaning of quality is important as it applies to products

and purchased materials.(p.2) Also, as Quality could be measured and achieved

consistently, hence, the definitions of the required quality characteristics must be

such that the supplier could know what were wanted, and both supplier and the

using company could measure to determine whether the quality characteristics

had been achieved.

While based on Bowen, et. al. (1999), quality was defined has a direct impact on

the product or service performance and could be defined as freedom from

defects. It suggested that quality began with customer needs and ends with

customer satisfaction. The primary aim of nowadays total quality movement has

become total customer satisfaction. They also pointed out that most customers

nowadays would not satisfy with poor or average quality. Therefore, organizations

today had no choice but to adopt quality concepts if they wanted to run their

business, let alone be profitable. Thus, the task of keeping improve product and

service quality should be the first priority of organizations. Furthermore, Johnson,

Weber (1985) has mentioned the benefit of achieved quality was comparable to

those encountered in procuring products.

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2.4 Service Quality

In order to have a deeper understand of service quality, there would be a literature to

explain the details of service quality. From this part, it would be known that there were

difference dimensions to measure service quality and had a special measurement for

analyzing service quality. Since the learning form this part, it would be easier to analyze

the service quality of Starbucks in Hong Kong.

2.4.1 The Definition of Service Quality

Service quality was the foundation for services marketing as the core product was

being marketed was a performance stated from Berry, Parasuraman (1991). On

the other hand, Berry, et. al. (1985) said that service quality is more difficult for

the consumer to evaluate than goods quality; service quality perceptions result

from a comparison of consumer expectations with actual service performance

(p.42)

2.4.2 Service Gap Model

In order to analyze the sources of quality problems and help to solve the problems

and improve the service quality for the organization, there was a model which

named Service Gap Model. This could help to analyze those problems in a more

simple way. According to Figure 2.1, it showed the whole structure of the model.

(Berry, et. al., 1985) and the following part would explain the details of each gap.

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Fig 2.1 Service Quality Model

Source: Berry, L. L., Parasuraman, A., Zeithaml, V. A. (1985: p.44)

Gap 1: The Listening Gap

It was the difference between the consumer expectations and management

perceptions of those expectations. This may have impact on the consumers

evaluation of service quality. The gap occurred when there were inadequate

marketing research orientation; lack of upward communication; insufficient

relation focus; and, inadequate service recovery. (Berry, et. al., 1985:p.45, Bitner,

et. al., 2009: p.34)

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Gap 2: The Service Design and Standards Gap

It was the difference between management perceptions of consumer expectations

and the firms service quality specifications. This would affect service quality

from the consumers viewpoint. The gap may occurred because of the poor

service design; absence of customer-driven standard; and, inappropriate physical

evidence and service scape. (Berry, et. al., 1985:p.45, Bitner, et. al., 2009: p.37)

Gap 3: The Service Performance Gap

It was the difference between service quality specifications and actual service

delivery. It would influence the service quality from the consumers standpoint.

The gap may appear when there were deficiencies in human resource policies;

failure to match supply and demand; customer not fulfilling roles; and, problems

with service intermediaries. (Berry, et. al., 1985:p.45, Bitner, et. al., 2009: p.39)

Gap 4: The Communication Gap

It was the difference between actual service delivery and external

communications about the service. It would also affect the service quality from a

consumers standpoint. This would be taken place since there were lacks of

integrated service marketing communications; ineffective management of

customer expectations; over promising; inadequate horizontal communications;

and, inappropriate pricing. (Berry, et. al., 1985:p.46, Bitner, et. al., 2009: p.42)

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Gap 5: The Customer Gap

It was the difference between customer expectations and perceptions. Customer

expectations are the standards or reference points that customers bring into the

service experience, whereas customer perceptions are subjective assessments of

actual service experiences. (Bitner, et. al., 2009: p.32)

2.4.3 Measurement of Service Quality

Quality measurement is probably the most important technique for a service

aiming for more than a superficial improvement. (p.178) said form Edvardsson,

et. al.(1994). While Armstrong, et. al. (1997) said that Quality in the service

industry is challenging to measure due to the unique characteristics of intangibility,

heterogeneity and inseparability of production and consumption. (p.183).

Moreover, it mentioned that using SERVQUAL model as a foundation to measure

the service quality.

From the identification of Berry, et. al. (1985), they developed 10 keys categories

to determine the service quality. In figure 2.2, it showed the 10 determinants of

service quality.

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Fig 2.2 Determinants of Perceived Service Quality

Source: Berry, L. L., Parasuraman, A., Zeithaml, V. A. (1985: p.48)

However, those 10 categories had been summarized by Berry, et. al. (1988a).

They had done a research based on those 10 determinants and had the extensive

statistical analysis of data from five different samples of respondents yielded a

highly reliable and valid instrument that named SERVQUAL model containing 22

items. (p.6). Finally, they grouped the items into five dimensions. And the five

SERVQUAL dimensions were shown in table 2.2.

Table 2.2 The Five SERVQUAL dimensions categories Dimensions Definition Reliability Ability to perform the promised service dependably and accurately Assurance The knowledge and courtesy of employees and their ability to inspire

trust and confidence Responsiveness The willingness to help customers and provide prompt service Tangibles The physical facilities, equipment, and appearance of personnel Empathy The caring, individualized attention the firm provides its customers

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There would be more details below of the five SERVQUAL dimensions based on

the explanation from Bitner, et. al. (2009, p.113-115)

Reliability

It referred to the delivery on promises. In those five dimensions of SERVQUAL,

reliability has been consistently shown to be the most important determinant of

perceptions of service quality. The word reliability meant the ability to perform

the promised service delivered on its promises-promises about delivery, service

provision, problem resolution, and pricing. Since customers wanted to do business

with organizations that could keep their promises, especially their promises about

service outcomes and core service attributes, therefore, reliability has always been

the important part. (p.113)

Assurance

It showed the inspiring trust and confidence. For the definition of assurance, it

was the employees knowledge and courtesy and the ability of the firm and its

employees to inspire customer trust and confidence. It pointed out this dimension

was likely to be mainly important for services that customers perceived as high

risk or for services of which they felt uncertain about their ability to evaluate

outcomes, such as medical, insurance and legal services. It said that trust and

confidence may be included in the person who links the customer to the

organization. In the service contexts, the organization sought to build trust and

loyalty between key contact people and individual customers. (p.114)

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Responsiveness

It was the willing to help customers and to provide prompt service. For

responsiveness, it intensified attentiveness and promptness in dealing with

customer requests, questions, complaints, and problems. It was communicated to

customers by the length of time they had to wait for assistance, answers to

questions, or attention to problems. It was also mentioned that as there would be

difference between the standards for speed and promptness of organization and

the customers requirements. Therefore, the organization must view the process of

service delivery and the handling of requests from customers point of view rather

than its point of view. (p.114)

Tangibles

It was representing the service physical. For the word tangibles in SERVQUAL,

it defined as the appearance of physical facilities, equipment, personnel, and

communication materials. It provided physical representations or images of the

service that customers, especially for the new customers, would use them to

evaluate quality. In service industries, organizations emphasized tangibles in their

strategies include services in which the customer visited the establishment to

receive the service, likes those hotels, restaurant and retail stores. (p.115)

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Empathy

It referred to the treating customers as individuals. In this dimension, it was

defined as the caring, individual attention that the firm provides its customers.

The substance of empathy was conveying, through personalized or customized

service, that customers were special and unique and that their needs were

understood. Since customers wanted to feel being understood and important to

firms that provide service to them. It also mentioned that the small service firm it

had, the more success could gain in empathy because they may offer customized

service easily. (p.114-115)

2.5 Consumer Behavior

It was also needed to study about the consumer behavior. It included the customer

expectation, perception and customer satisfaction. After understanding the expectation

and perception, it could help to understand what customer satisfaction was. It was useful

because it could help to understand and analyze the customer satisfaction of Starbucks in

Hong Kong.

2.5.1 The Definition of Consumer Behavior

From the explanation of Hoyer, MacInnis (2007), they stated that consumer

behavior referred to the study on how people purchase the product or service and

how to obtain a product or service at any one point of time. Similarly, from Buttle

(1986), consumer behavior is a developing science(p.76) He explained that the

scientific method was the setting up and testing of hypotheses which confirm or

refute existing theory, thereby strengthening or weakening the theory, was the

formal and normal method of development in any science.

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2.5.2 Expectation

According to the concept from Bitner, et. al. (2009), customer expectations are

the beliefs about service delivery that serve as standards or reference points

against which performance is judged. (p.75). In the meanwhile, Berry, et. al.

(1990) stated that customers expectation would be influenced by how well of the

performance provided by the provider. There would be several factors that

influenced expectation. They included personal needs, past experience, word of

mouth that may from friends, families or other contact peoples information,

external communication and price.

Bitner, et. al. (2009) also stated that the level of expectation could vary widely

depending on the reference point the customer holds. In order to comprehend,

measure and manage the customers expectation more easily, the service

marketers should have a clear definition of expectations. As showed in Figure 2.3,

there would be an example about the different possible types of service

expectations could be arrayed from low to high in a restaurant. With the help of

the example, it could show the different level of expectations in a simple way.

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Fig 2.3 Possible Levels of Customer Expectations

Source: Teas (1993: p.18-34, cited in Bitner, et. al., 2009:p.76)

2.5.3 Perception

In terms of the explanation of Berry, et. al. (1988b), perception was explained as

the resulted from the contrast of consumer expectation with actual service

performance.

Based on Kothari, Sharma (2009), perceptions after service contacts would make

expectations more realistic and practical in cases of services. There were three

themes which were relating to the evaluation and perception of service quality

(Parasuraman, et. al., 1985 cited in Ayala, er. Al., 1996) Firstly, service quality

was too hand for customer to evaluate than product quality. Secondly, the result

of perceived service quality was to compare of customer expectations with actual

23

service performance. Lastly, quality evaluations were not only focus on the

outcome of a service, it also needs to evaluate of the process of service

delivery.(p.259-261)

2.5.4 Customer Satisfaction

Oliver (1997) said that Satisfaction is the consumers fulfillment response. It is a

judgment that a product or service feature, or the product or service itself,

provides a pleasurable level of consumption-related fulfillment. (p.13) While

Bitner, et. al. (2009) stated that satisfaction is a dynamic, moving target that may

evolve over time, influenced by a variety of factors (p.104-105). They explained

that when the usage of product or the service experience took place over time,

satisfaction would become highly variable that depended on which part in the

usage or experience was focusing on. Furthermore, Hoyer, MacInnis (2007) had

pointed out that customer satisfaction defined as the consumers evaluation of the

outcomes of their decision. Consumer may felt satisfaction if they thought their

needs or wants had been achieved. If the level of customer perception meets the

level of expectation, customer satisfaction would be gained.

By summarized of the above literature, higher the level of customer satisfaction

could lead to earn more for the business. It would increase the chances for

repeated purchase, positive word-of-mouth promotion and hence to increase the

profitability.

24

2.6 Relationship between Service Quality and Customer Satisfaction

With the help of the study about the relationship between service quality and customer

satisfaction, it could be surer that there were link between the two concepts. Therefore, it

could help to set up the questionnaire easier with the aim of analyze the service quality

and customer satisfaction of Starbucks in Hong Kong which could help to find the result

for the survey in chapter 3.

2.6.1 Satisfaction versus Service Quality

Bitner, et. al. (2009) explained that it was popular to use the terms of satisfaction

and quality interchangeably for practitioners and writers. However, the

researchers were more precise about the different meanings and measurement

between the two concepts. They also mentioned that even though some concepts

of satisfaction and quality may in common, satisfaction is generally viewed as a

broader concept, whereas service quality focuses specifically on dimensions of

service (p.103). As shown in figure 2.4, it could see that perceived service

quality was a component of customer satisfaction, and the figure illustrated the

relationships between the two concepts.

To conclude the relationship between service quality and customer satisfaction-the

service quality was a focused evaluation that reflected the customers perception

of the five dimensions, reliability, responsiveness, assurance, empathy, and

tangible. While for satisfaction, it was influenced by perceptions of service quality,

product quality, and price, or others situational and personal factors which was

more inclusive. Therefore, it could see that service quality was one of the

elements that determine customer satisfaction.

25

Fig 2.4 Customer Perceptions of Quality and Customer Satisfaction

Source: Bitner, M. J., et. al. (2009, p.103)

2.7 Summary

From this chapter, it has shown the definitions of the specific terms like service quality,

customer satisfaction and the relationship between the two issues. By understand more

about the above terms, the easier to analyze the service quality and customer satisfaction

of Starbucks in Hong Kong. In the next chapter, it would introduce the methodology

about the primary research used in this study and explain about why the method was been

chosen.

26

Chapter 3 Methodology

3.1 Introduction

Apart from getting information in Literature Review, it was also important for the

research to find out the up-to-date data about the relationship between the service quality

and customer satisfaction in the Starbucks Coffee in order to have an all-round research.

By getting sufficient data for analysis, a quantitative research would be used.

In this chapter, it would state out the process of data collection including the research

methods used, design of the questionnaire, sampling, piloting, data analysis and

mentioned about the limitations in the research.

3.2 Primary Research

According to Sekaran (2003), it stated that a research was defined as an organized,

systematic, data-based, critical, objective, scientific inquiry or investigation into a

specific problem, undertaken with the purpose of finding answers or solutions to it.(p.5)

Moreover, Diehl and Gay (1992) said that research is the formal, systematic application

of the scientific method to the study of problems.(p.6). As the aim of the study was to

find out the relationship between the service quality and customer satisfaction, therefore,

a research was needed to find out the answer.

About the primary research, it means collecting the original data by using an accepted

research method and the research which has been designed by the own researcher to

answer specific research questions (Clark, Riley, Wilkie, et al, 1998) and (Webb 2002).

27

For the primary data, Armstrong and Kotler (2000) said that it consists of wanted

information collected for the specific purpose for the research. There were two categories

methods for the primary research named qualitative and quantitative which would had

more explanation in the section of 3.4 Research Methods. In this study, it would focus on

the quantitative method by conducted a questionnaire for collecting data about the

customer satisfaction through the service quality in Starbucks Coffee that help for

analysis.

3.3 Secondary Research

Based on Webb (2002), a secondary research means a research that has been carried out

already for others purpose results. The secondary data could be collected form books,

journals, magazine articles, newspaper, reports to shareholders, etc. (Lewis, Saunders,

Thornhill, 2000). With the help of the secondary data, it could provide background

information to primary research, solve the problem, wiped out the need for primary

research altogether which led to time saving. In this study, the secondary data helped to

provide the definitions of specific terms likes customer satisfaction, service quality, etc.

3.4 Research Methods

As it has mentioned before, there were two types of research methods in the primary

research, qualitative and quantitative, the paragraphs showed below were the meaning of

each method.

28

3.4.1 Qualitative Research

According to Gummesson (1991) and Van Maanen (1979), a qualitative method is

a useful tool for the research that mostly provides the terms of meaning, but not

the frequency and only to a limited degree. Furthermore, Cassell and Symon

(1994) said that qualitative research allowed more flexibilities while it is less

likely to impose restrictive a priority classifications on the collection of data. As a

result of the underlying epistemology, research is less driven by very specific

hypotheses and categorical frameworks and more concerned with emergent

themes and idiographic descriptions.(p.4)

3.4.2 Quantitative Research

About quantitative research, it mainly focus on the mathematical and statistical

data which help to form a broad range of numerical approaches for analyzing and

solving problems stated by Waters (2008) and Wisniewski (1994). Besides that,

from Curwin and Slater (2008), they pointed out the quantitative methods

involve more than obtaining a few numbers and working out a few

statisticsprovide a framework for working with statistics. In addition to provide

description, quantitative methods also include a number of ways of testing ideas

and modeling problems. (p.2)

For the most ideal method for doing the research is to combine both qualitative

and quantitative methods which could get the comprehensive information for the

research problem include the meaning and the statistics. However, for the time

limitation, there was only one method could be used. Since the aim of the research

was to collect numbers of customers comments to analyze the link between the

service quality and customer satisfaction in Starbucks Coffee, as quantitative

29

method involved the frequency of the data while for qualitative method focused

on the meaning of terms. Hence, it was more suitable for using the quantitative

method during the whole research.

3.5 Design of Questionnaire

3.5.1 Structure

Base on Lewis, Saunders, Thornhill (2000) stated out that a survey allows the

collection of a large amount of data from a sizeable population in a highly

economical way. Based most often on a questionnaire, these data are standardized

allowing easy comparisonand it is easily understood (p.93-94). From the

reason above, having questionnaire for collecting data was used in this study.

In addition, the meaning of questionnaire was a general way to include all the

techniques of data collection in the person who is asked to respond to the same set

of questions in a predetermined order said form deVas (1996). There were several

types of questionnaires, as Figure 3.1 shown, there were five types of

questionnaire based on two kinds of administered.

Since the types of delivery and collection questionnaire was a more convenient

way and had a higher response rate compared with others, consequently was

chosen in this survey.

30

Questionnaire

Self- Administered

Interviewer Administered

Telephone Questionnaire

Structured Interview

On-line Questionnaire

Postal Questionnaire

Delivery andCollection

Questionnaire

Fig 3.1 Types of questionnaire

Source: Lewis, Saunders, Thornhill (2000)

The questionnaire was divided into three sections in order to collect data to

measure the exiting service quality and the level of customer satisfaction in

Starbucks Coffee. (Refer to appendix 1 for questionnaire in English and

appendix 2 for questionnaire in Chinese)

The first part of the questionnaire, Section A, was designed to obtain the

information of customers expectations and the service they have experienced

after visiting in Starbucks Coffee. There were three columns in Section A with 19

statements were listed in the center column. The questionnaire was adopted and

developed by the literature Shih (2006) and Berry, et. al. (1994), the attitude

statements were quoted from their questionnaire based on the five dimensions of

service quality as showed in Table 3.1. For the left column of Section A, it

belonged to the expectations of customers in Starbucks Coffee while for the right

column; it belonged to the service they have experienced after visiting Starbucks.

31

Based on the work of Shih, he used the seven scales for the likert scale of rating

the agreement or disagreement with each attitude statement. But in this

questionnaire, only 5 scales were used with 5 indicated strongly agree and 1

indicated strongly disagree because of the efficiency for the respondents.

In Section B, it was designed to obtain the information about how importance was

the service quality impacted an organization through the five dimensions of

service quality (5 indicate extremely important and 1 indicate not at all

important). The collected data could help to make recommendations in this

study.

In Section C, it mainly collected the demographic profiles and characteristics of

each respondent, such as, gender, age, education level, etc.

Table 3.1 Statements pertaining to the five dimensions

Reliability Statement 1-4

Responsiveness Statement 5-8

Assurance Statement 9-12

Empathy Statement 13-16

Tangibles Statement 17-20

3.5.2 Hypothesis

As the aim of the research was to collect numbers of customers comments to

analyze the link between the service quality and customer satisfaction in

Starbucks Coffee, in order to apply the theories that from literature review, there

were hypotheses that made for the survey results.

32

(1) Starbucks Coffee could gain the customer satisfaction in the five dimensions

of Service Quality.

(2) The dimension of reliability should be the most important issue toward

Starbucks Coffee according to responses of respondents.

3.5.3 Wording and Language

For the convenience of the respondents, the questionnaire was writing in simple

terms to explain each section. Similarly, it was designed in English and Chinese

version because it could help the respondents to read and understand the

questionnaire easier.

3.6 Sampling

In terms of the explanation from Lewis, Saunders, Thornhill (2000), sampling provides a

range of ways that help to lower the amount of data which was needed to collect by

considering only data from a sub-group rather than all possible cases. Furthermore, Webb

(2002) pointed out a sampling frame was a way to establish the boundaries of the

population which would contain all the elements and units necessary to fulfill the

objectives of the research without key units being excluded or extraneous units being

included. In above, sampling could help to save time and more manageable as less people

were involved.

The sampling in this study was focused on people who have visited Starbucks Coffee

before and all respondents were aged 18 or above. About the target sample size, it was

designed to achieve 100 respondents for the whole survey; however, there were only 90

of completed questionnaires.

33

3.7 Piloting

The pilot study is an exploratory phase which aims to identify and eliminate problems

before the full questionnaire survey is carried out said Johns and Lee-Ross (1998). The

benefit of conducting pilot test was to uncover the faults of the questionnaire and ensure

the questionnaire would gather the intended information. Hence, the test was given to a

small sample of individuals who were likely to the focus group before the give to the

focus group.

For the pilot test in this study, questionnaires were given to 8 respondents who were form

Hong Kong Institute of Vocational Education, Haking Wong Campus. Six of them were

the students of Hospitality field and the others were the tutors of the campus. Some

problems were found in the questionnaire during the test such as having confused about

the choice in Part B and confused about the meaning of words. After conducting the test,

problems have been solved by rewording and providing more instruction for the

questionnaire.

3.8 Data Collection

Both primary and secondary data were used for this study. About the collection of

secondary data, it mainly relied on books, journals, webpage, articles of magazines and

newspapers. For the primary data, it relied on the questionnaires that received from the

respondents.

34

The survey was conducted from 1st to 10th March 2010 in person form two different

places, the Hong Kong Institute of Vocational Education Chai Wan Campus and outside

of Starbucks Coffee in Hong Kong in Causeway Bay in person. 40 of the questionnaires

were distributed in the campus while the other 60 of questionnaires were given outside of

Starbucks Coffee. According to the table 3.2, it showed the distribution of the

questionnaires given. The survey was carried out with a self-administered way. There

were total 90 completed questionnaires for analysis.

Table 3.2 The given questionnaires distribution Place of distributed questionnaires

Number of questionnaires distributed

Number of questionnaires received

Chai Wan Campus 40 38 Outside of Starbucks Coffee

60 52

Total 100 90

3.9 Data Analysis

The collected data was analyzed by applying the Statistical Package for the Social

Sciences (SPSS) Windows version 18. It was a system that help to turn the data become

meaningful by analyzing them through the system calculation. With the help of the

descriptive statistics analysis from SPSS, it could show the frequencies which generally

obtained from nominal scales and show out the frequency distribution by using the mean

and standard deviation.

35

3.10 Limitations

3.10.1 Primary Research

There were several constraints when conducting the questionnaire survey. For the

primary data, since part of the questionnaire was asking about the customers

expectations before visiting Starbucks Coffee. For the most ideal collected data

for this part should be those respondents who have never visited Starbucks before

and having comparison after visiting. However, some respondents may not be the

first time to visit Starbucks. Although they could still have expectations before

visiting it each time, this could lead to have bias since they have already

experienced at once, therefore, it may affect the reliability of the result.

3.10.2 Secondary Research

About the constrain for secondary data, there were too many information about

the definitions of specific terms, for example, service, quality, expectation, etc. it

was difficult to analyze which information was the most suitable issue for the

study.

3.11 Summary

Within this chapter, it has given out the definitions and the reason why chosen of the

research methods likes qualitative and quantitative research. It has also mentioned the

process of conducting the research method and the limitation appeared in the research. In

the next chapter, it would cover the result and showing the analysis of the collected data

from the respondents.

36

Chapter 4 Findings and Analysis

4.1 Introduction

In this chapter, it would show the analysis results of the collected data from the primary

research. The sample of questionnaires was shown in (Appendix A and B). Since the aim

of the study was to find the relationship between service quality and customer satisfaction

of Starbucks in Hong Kong, therefore the conducted survey helped to collect the related

data from the people who have visited Starbucks. They were mainly about the customers

expectation, perception, and level of importance according to the 5 dimensions of

SERVQUAL. The survey was conducted outside the Starbucks Coffee and in the campus.

There would be six parts in this chapter. The first part would provide the demographic

profile of the respondents. Second, it would about the analysis of the five dimensions of

service quality in Starbucks Coffee from customers view. The following part was would

mentioned about the analysis of overall customer satisfaction in Starbucks Coffee. Then,

it would analysis some of the factors that influence the expectation and perception of

customers. For the final part, it would analysis the level of importance of five

SERVQUAL dimensions to Starbucks based on the customers point of view.

All the collected data were analyzed by the Statistical Package for the Social Science

(SPSS). It made use of the frequencies, crosstabs, one-way ANOVA system to show the

result in a clearer way.

37

4.2 Demographic Profile of Respondents

Table 4.1 Demographic profile of respondents Frequency (n)

n = no. of respondents

Valid Percentage (%)

Gender Male 40 44.4 Female 50 55.6

Age Group 18-24 41 45.6 25-34 21 23.3 35-44 18 20.0 45-54 6 6.7 55-64 4 4.4

Education Level

Secondary School 24 26.7 Vocational School 21 23.3 University 43 47.8 Postgraduate 2 2.2

Occupation Student 42 46.7 White-collar 23 25.6 Blue-collar 4 4.4 Self-employed 3 3.3 Professional 8 8.9 Administrative/Executive 2 2.2 Retired 1 1.1 Others 7 7.8

Average Monthly

Income Range ($)

8,000 or below 44 48.9 8,001 10,000 17 18.9 10,001 20,000 15 16.7 20,001 30,000 12 13.3 30,001 40,000 2 2.2

Visiting Frequency (monthly)

0 5 62 68.9 6 10 16 17.8 11 15 5 5.6 16 20 3 3.3 21 25 4 4.4

Starbucks Member Card

Yes 15 16.7 No 75 83.3

Repeat Visiting Yes 86 95.6 No 4 4.4

38

The sample size of this survey was 100 respondents. However, there were only 90

questionnaires that were completed. According to the table 4.1, it showed the overall

demographic profile of the respondents.

Referring to the table, there were 50 respondents who were females while 49 were males.

The percentages were 55.6% and 44.4 respectively. About the age group, the largest

group was aged 18 to 24, it had 41 respondents which had 45.6%. The two following

groups were aged 25 to 34 with 21 respondents and aged 35 to 44 with 18 respondents.

Their percentages were 23.3% and 20%.

Apart from that, the data showed that the respondents who attended in university were the

largest group of the variables of education level. It contained 43 of respondents that

shared 47.8% which were nearly half of the total number of respondents. For the second

largest group, it belonged to the group of Secondary School with 24 respondents which

were 26.7%.

About the occupation of those respondents, there were 42 students which belonged to the

largest group, it shared 46.7 %. While for the while-collar, it belonged to the second

largest group with 23 respondents that shared 25.6%. About their average monthly

income rate, as half of the respondents were student, therefore most of their income rate

were belonged to the group of $8,000 or below. It had 44 respondents with 48.9%.

In terms of the data of how customers response to Starbucks, for the variables of how

often the customers visit Starbucks Coffee in a month, it found out that more than half of

the respondents visit Starbucks 0 to 5 times in a month. It had 62 respondents with 68.9%

that be the largest group. For the second largest group, it belonged to the group of visit 6

39

to 10 times. There were 16 respondents in this group and shared 17.8%. In addition,

there were 75 respondents who did not have the Starbucks Coffee member cards which

shared 83.3%. It reflected that there Starbucks member cards were not really common in

the public. It may be because they did not promote their member cards as well. Lastly, for

the variables about would the respondents visit Starbucks coffee again, there were 86

respondents would like to visit Starbucks Coffee again. It shared 95.6%.

Since the sizes of the background of respondents groups were different, hence, there

would be more focus on the analysis on those larger groups, such as students, respondents

who attended university, the age group 18 to 24, etc in some of the following sections.

As there were more data to support the results which could increase the validity of the

research.

40

4.3 Analysis of five dimensions of service quality

In this section, it was mainly focusing the five dimensions of service quality which were

reliability, responsiveness, assurance, empathy and tangibles. The aim of this section was

to compare the expectation and the perception of customers (respondents), the

experienced after visiting Starbucks Coffee based on the five dimensions of service

quality. Each of the following part of this section would show the mean of the variables

which were the average rating of each attitude statements. According to the literature

review of customer satisfaction in chapter 2, customers may felt satisfaction if they

thought their needs or wants had been achieved. If the level of customer perception meets

the level of expectation, customer satisfaction would be gained. Hence, this section

would show the gap score between the expectation and perception, if it got positive score,

it reflected customers were satisfied, or otherwise for the negative score, it reflected of

customers dissatisfaction.

4.3.1 Reliability

There were four attitude statements belonged in the reliability dimension. They

included did the employee maintain error-free service; did they perform the

services right at the first time; did they provide services at the promised time; and,

were they dependable when handling customers service problems. According to

table 4.2 and figure 4.1, they showed clearly that most respondents were not

satisfied in reliability dimension, all the mean of respondents perception were

below the mean of expectation. Especially for the statements about perform

service right, provide service at promised time, and dependable on handling

problems, the mean of those three perceptions were 2.9 which less than the

expectation about 1.2 rating. Since the definition of reliability was the ability to

41

perform the promised service delivered on its promises-promises about delivery,

service provision, problem resolution, and pricing. (Bitner, et. al., 2009:p.113),

therefore the result analysis reflected that there were always been some mistakes

made by the employees like serving the wrong food and beverage, or could not

serve the drinks to the customers within two minutes, the promised serving time

to customers. In addition, according to the literature, reliability has been

consistently shown to be the most important determinant of perceptions of service

quality, however, there were unsatisfied with the reliability; hence, there should be

improvement of reliability for Starbucks Coffee.

Table 4.2 Comparison of mean in reliability dimension Attitude Statement Expectation

(Mean) Perception

(Mean) Gap Score

Error-free service 3.7 2.9 -0.8 Perform service right 4.0 2.8 -1.2 Provide service at promised time 4.0 2.8 -1.2 Dependable on handling problems 4.0 2.8 -1.2 Overall Reliability 3.9 2.8 -1.1

42

Fig 4.1 Compare mean in reliability dimension

Reliability

00.5

11.5

22.5

33.5

44.5

Error-free service Perform serviceright

Provide services atpromised time

Dependable onhandling problems

Attitude Statement

MeanExpectationPerception

4.3.2 Responsiveness

Based on the explanation of Bitner, et. al., 2009, responsiveness stood for the

attentiveness and promptness in dealing with customer requests, questions,

complaints, and problems (p.114). It included the employees provided prompt

services; they were not busy to respond to customers; they were always willing to

help; and, they kept informed about when services would be informed. As the

table 4.3 and figure 4.2 shown, the respondents felt satisfied with the dimension

of responsiveness. The mean of overall perception was 4.1 that higher than

expectation by 0.2 rating. It could implicate that Starbuck Coffee had the

successful work in the responsiveness dimension. In terms of the definition, they

could provide prompt service to their customers and showed that they were

willing to help customers and not busy to respond to them. Specially for keeping

informed about their services to customers, the mean of this statements

perception was 4.1 that higher than expectation 0.3 rating, which was the most

satisfied attitude statement. For the example of the works of keeping informed

such as informed their customers that the beverages were already made for them,

etc.

43

Table 4.3 Comparison of mean in responsiveness dimension Attitude Statement Expectation

(Mean) Perception

(Mean) Gap Score

Prompt Service 3.9 4.1 0.2 Not busy to response 4.0 4.1 0.1 Willing to help 4.0 4.2 0.2 Keeping informed 3.8 4.1 0.3 Overall Responsiveness 3.9 4.1 0.2

Fig 4.2 Compare mean in responsiveness dimension

Responsiveness

3.63.73.83.9

44.14.24.3

Prompt serivce Not busy torespond

Willing to help Keeping informed

Attitude Statement

MeanExpectationPerception

4.3.3 Assurance

For the result analysis of the assurance dimension of service quality, from the

table 4.4 and figure 4.3 shown, the overall mean of expectation was lower than

perception by 0.4 rating. As the gap score was positive, it reflected most

respondents were also satisfied with this dimension. As the assurance were the

employees knowledge, courtesy and the ability of the firm and its employees to

inspire customer trust and confidence (Bitner, et. al., 2009:p.114), thus, it

showed that the employees of Starbucks Coffee were consistently courteous; had

the knowledge necessary to respond to customers; let their customers felt safe in

the transactions; and, instilled confidence to their customers. For the most

44

satisfied work was the employees of Starbuck could instill confidence to their

customers. The mean of respondents perception was 4.1 that higher than

expectation by 0.5 rating. It meant that the behaviors of employees were good

enough that customers could trust their abilities, such as the skills of making

Starbucks beverages.

Table 4.4 Comparison of mean in assurance dimension Attitude Statement Expectation

(Mean) Perception

(Mean) Gap Score

Consistently Courteous 3.7 4.1 0.4 Enough knowledge to respond 3.8 4.1 0.3 Safe transactions 3.8 4.1 0.3 Instill confidence 3.6 4.1 0.5 Overall Assurance 3.7 4.1 0.4

Fig 4.3 Compare mean in assurance dimension

Assurance

3.33.43.53.63.73.83.9

44.14.2

Consistentlycourteous

Enough knowledgeto respond

Safe transactions Instill confidence

Attitude Statement

MeanExpectationPerception

45

4.3.4 Empathy

From the explanation of Bitner, et. al., 2009, empathy was defined as the caring,

individual attention that the firm provides its customers (p.114). About the

attitude statements in this dimension, they included the shops had the convenient

opening hours to customers; the employees could understand customers

particular needs, they could give individual attention to their customers; and, they

could have the customers best interest at heart. However, for the situation of

Starbucks Coffee, most respondents felt unsatisfied within this dimension. The

mean of overall perception of respondents was only 2.7 and less than expectation

with 1.2 rating according to the table 4.5 and figure 4.4. Especially about the

giving of individual attention to customers and having the customers best interest

in heart. The mean over perception was lower than expectation by 1.4 rating. It

came out the result that the employees of Starbucks Coffee could not provide

customized services to their customers. Even though there were different needs

and wants of customers, the employees could not make sure to take care all of

them that improvements should be needed in this dimension.

Table 4.5 Comparison of mean in empathy dimension Attitude Statement Expectation

(Mean) Perception

(Mean) Gap Score

Convenient opening hour 3.9 3.3 -0.6 Understand particular needs 4.0 2.7 -1.3 Individual attention 3.9 2.5 -1.4 Best interest in heart 3.8 2.4 -1.4 Overall Empathy 3.9 2.7 -1.2

46

Fig 4.4 Compare mean in empathy dimension

Empathy

00.5

11.5

22.5

33.5

44.5

Convenientopening hour

Understandparticular needs

Individualattention

Best interest inheart

Attitude Statement

MeanExpectationPerception

4.3.5 Tangibles

From the result analysis of table 4.6 and figure 4.5, they showed that most

respondents were also not satisfied with the dimension of tangibles. For tangibles,

it defined as the appearance of physical facilities, equipment, personnel, and

communication materials. (Bitner, et. al., 2009:p.115). For the attitude statements

in this dimension, they included the visually provision of appealing appearance

and written appearance in shops; the neat appearances of employees; and, there

were modern equipments in shops. However, for Starbucks Coffee, they only got

2.9 rating of overall mean of perception which less than expectation by 1.1 rating.

About the most dissatisfaction part, they were the neat appearance of employees

and the appealing written materials of Starbucks. Both of them had 1.4 rating of

perception which less than expectation. It implicated that Starbucks may not have

enough management for the appearance of their employees and their written

materials likes menus that needed to design again.

47

Table 4.6 Comparison of mean in tangibles dimension Attitude Statement Expectation

(Mean) Perception

(Mean) Gap Score

Appealing appearance 3.8 3.0 -0.8 Neat appearance of employee 4.1 2.7 -1.4 Appealing written materials 4.1 2.7 -1.4 Modern equipments 4.1 3.1 -1.0 Overall Tangibles 4.0 2.9 -1.1

Fig 4.5 Compare mean in tangibles dimension

Tangibles

00.5

11.5

22.5

33.5

44.5

Appealingappearance

Neat appearanceof employee

Appealing writtenmaterials

Modernequipment

Attitude Statement

MeanExpectationPerception

4.4 Analysis of overall customer satisfaction

After having the analysis about each dimension of service quality, it needed to have a

look of overall customer satisfaction in Starbucks Coffee. The below table 4.7 showed

the mean of respondents expectation and perception based on the five dimensions of

service quality, including the gap score. Similar with above section, the gap score with

positive rating which meant respondents were satisfied. In opposition, if the gap score

which had negative rating, it reflected the respondents were unsatisfied. With the help of

the table and the chart shown in figure 4.6, it could know that whether the respondents

were satisfied or not in a clearly way.

48

Table 4.7 Comparison of overall mean of expectation and perception based on five dimensions

Five dimensions of service quality Expectation(Mean)

Perception(Mean)

Gap Score

Reliability 3.9 2.8 -1.1 Responsiveness 3.9 4.1 0.2 Assurance 3.7 4.1 0.4 Empathy 3.9 2.7 -1.2 Tangibles 4.0 2.9 -1.1 Overall 3.9 3.3 -0.6

Fig 4.6 Overall mean of expectation and perception based on five

dimensions

Overall average mean of expectation and perception

00.5

11.5

22.5

33.5

44.5

Relia

bility

Respo

nsive

ness

Assur

ance

Emap

thy

Tang

ible

Five dimensions of Service Quality

MeanExpectationPerception

From the table and figure showed above, it was clearly seen that there were both

satisfaction and dissatisfaction according to the five dimensions of service quality.

Referring to the table 4.7, for the yellow lighten, it represented the most satisfaction

dimension while for the green lighten, it represented the most dissatisfaction dimension.

About the dimensions that gained customers satisfaction, they were responsiveness and

assurance, with the mean of perception 4.1 that higher than expectation by 0.2 and 0.4

rating respectively. Especially for the dimension of assurance, it was the most satisfaction

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category within these five dimensions. It showed that Starbuck Coffee was more

excellent at the work of inspiring confidence and trust to their customers, such as let their

customers felt safe in the transactions and employees had enough necessary knowledge to

respond to the customers that instilled confidence to customers. The knowledge may

include about different coffee beans or differences of beverages.

However, there were still unsatisfied with the dimensions of service quality likes

reliability, empathy and tangibles. For the most dissatisfaction, it belonged to the

dimension of empathy. It implicated that employees of Starbucks Coffee had not enough

effort to show or provide the caring individualized service to their customers. Although it

was a hard job to provide customized service because of different expectation of

customers, providing those services were becoming more important nowadays. Since

consumers were looking for the individualized services more than before, therefore, the

more personalized services were provided, the more satisfaction could gain for the

organizations. As Starbucks Coffee could not satisfied customers in this dimension, thus,

improvements were needed in order to increase the level of customer satisfaction. About

the recommendation for improvement, it would be discussed in the following chapter.

About the hypothesis that made in the chapter of Methodology, it was estimated that

Starbucks Coffee could gain customer satisfaction in all dimensions of service quality.

However, as seen in table 4.7 and the chart shown in figure 4.6, the result analysis was

contradicted to the hypothesis. Even there were satisfactions in responsiveness and

assurance, but for the overview of service quality, the mean of perception (3.3) which

was lower than the mean of expectation (3.9). It reflected that Starbucks Coffee could not

maintain its service level at a standard quality that could gain customer satisfaction. It

may because of they could not provide the right service all the times, likes provide the

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wrong beverages to customers; could not provide personalized service; and, the

appearances of Starbucks Coffee was not appealing enough.

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4.5 Factors analysis

After the analysis of the overall customer satisfaction, it would be more effective of

understanding how the respondents response if having the analysis about the factors that

influenced the result. Those factors included the gender, age group, education level, etc.

By having the factors analysis, it could help to develop the strategies and solutions for

Starbucks Coffee that directed against to the problems.

In this chapter, it would use the One-way ANOVA system of SPSS in order to analyze the

factors toward to the attitude statements. According to Veal (2006), the ANOVA was

used to examine more than two means at a time. (p.348). Tables would be shown in

each analysis and it would focus on the factors that having the significant number which

less than 0.05. It represented that that was a great different between two sample

percentages more likely it was that the difference was real and not just a statistical chance

happening. (p.336) In this chapter, it would try to discuss the large different of means

between group. Same with the above section, for those yellow highlight of number

represented the highest mean while for the green highlight, it represented the lowest

mean.

4.5.1 Expectation

4.5.1.1 Age Group

Table 4.8 Statistics of respondents expectation toward age group Attitude Statement Significant number Understand particular needs 0.026 Individual attention 0.001 Neat appearance of employee 0.040

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Table 4.9 Different mean of respondents expectation toward age group Attitude Statement Age group Frequency

(n) Mean

Understand particular needs 18-24 41 3.7 25-34 21 4.4 35-44 18 4.1 45-54 6 4.3 55-64 4 3.8

Individual attention 18-24 41 3.4 25-34 21 4.3 35-44 18 4.0 45-54 6 4.3 55-64 4 4.8

Neat appearance of employee 18-24 41 3.9 25-34 21 4.4 35-44 18 4.4 45-54 6 4.2 55-64 4 4.0

According to the significant number shown in table 4.8 (with the full

version in Appendix 3), it could see that there was larger differences in

different age group toward the expectation of understand particular needs,

individual attention, and neat appearance of employee. Especially for the

group aged 18 to 24, based on table 4.9, they got the lowest mean among

those three statements. It would be because those ages of respondents were

quite young that did not request too much for the service. They were not

looking for the customized service and would not mind the appearance of

employees. The characteristic of youth were not really focus on quality of

services provided by employee but focus on the serving time.

Compare with the highest mean of expectation, it belonged to the age

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group of 25-34; 35-44; and, 55-64. It seemed that the age group of who

had more knowledge and the more working experiences would be more

demand for the quality of service. It would be because they had more

knowledge about what service quality was and know to spend on the

quality products and services.

4.5.1.2 Occupation

Table 4.10 Statistics of respondents expectation toward occupation Attitude Statement Significant number Individual attention 0. 003

Table 4.11 Different mean of respondents expectation toward occupationAttitude Statement Occupation Frequency

(n) Mean

Individual attention Student 42 3.4 White-collar 23 4.4 Blue-collar 4 4.0 Self-employed 3 4.0 Professional 8 4.3 Administrative / Executive 2 4.5 Retired 1 3.0 Others 7 4.1

Based on the significant number shown in table 4.10 (with the full version

in Appendix 4), it could see that there was a large different of respondents

occupation toward the expectation of individual attention. Form table 4.11,

there was the highest level of expectation in the group of administrative or

executive, with the mean of 4.5 rating, while for the lowest level of

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expectation, it belonged to the respondent of retired. It reflected that the

different categories of job may also influence the response of customers

towards the level of expectation. For the administrative, since they had the

work of management which needed to consider the all-round environment

and also the details. Therefore, it may leads to influence them to look for

individual attention for their daily life. On the other hand, for the retired,

as they were relatively more free than those who had to work, hence, they

may not really care about the customized service as they may had enough

time to serve themselves.

4.5.2 Perception

4.5.2.1 Gender

Table 4.12 Statistics of respondents perception toward gender Attitude Statement Significant number Dependable on handling problems 0.014 Not busy to respond 0.013 Understand particular needs 0.013 Best interest in heart 0.037 Neat appearance of employee 0.032 Modern equipment 0.036

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Table 4.13 Different mean of respondents perception toward gender Attitude Statement Gender Frequency

(n) Mean

Dependable on handling problems Male 40 2.5 Female 50 3.0

Not busy to respond Male 40 4.3 Female 50 3.9

Understand particular needs Male 40 2.4 Female 50 3.0

Best interest in heart Male 40 2.1 Female 50 2.6

Neat appearance of employee Male 40 2.4 Female 50 2.9

Modern equipment Male 40 2.9 Female 50 3.3

About the factor of gender toward to the level of perception, form table

4.12 (with the full version in Appendix 5), there were the significant in the

statements of dependable, not busy to respond, understand, best interest in

heart, nest appearance of employee and modern equipment. It was quite

uncommon to see that the general mean of male toward perception was

lower than the female according to table 4.13, it may reflected that males

were now demanding more than female. The reason behind maybe

included the increases amount of information of service quality released to

public, with the more channels of knowing what service quality was,

therefore, it would be higher the level of demand for the public.

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4.5.2.2 Average income rate

Table 4.14 Statistics of respondents perception toward average income rate

Attitude Statement Significant number Prompt service 0.002 Willing to help 0.006 Keeping informed 0.004

Table 4.15 Different mean of respondents perception toward average income rate

Attitude Statement Average income rate

Frequency (n)

Mean

Prompt service $8,000 or below 44 3.8 $8,001-$10,000 17 4.2 $10,001-$20,000 15 4.7 $20,001-$30,000 12 4.2 $30,001-$40,000 2 4.0

Willing to help $8,000 or below 44 3.9 $8,001-$10,000 17 4.6 $10,001-$20,000 15 4.5 $20,001-$30,000 12 4.3 $30,001-$40,000 2 3.5

Keeping informed $8,000 or below 44 3.8 $8,001-$10,000 17 4.1 $10,001-$20,000 15 4.7 $20,001-$30,000 12 4.3 $30,001-$40,000 2 3.5

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About the factor of average monthly income rate, it would focus how

respondents responded to the perception according to the money factor.

According to table 4.14 (with the full version in Appendix 6), it showed

that there were significant among prompt service, willing to help and

keeping informed. Based on the different mean from table 4.15, it could

see that the group of respondents who had income $8,000 or below was

had the lowest level of perception in prompt service. Since most students

belonged to the group of $8,000 or below, they were more cared about

the service time as they may have less patient in waiting for the services

provided. Therefore, it may lead to the result of the lowest level of

perception in the prompt service statement.

About the group of respondents who had average income

$30,001-40,000, it belonged to the highest level of income rate group.

However, they had the lowest level of perception in the statements of

willing to help and keeping informed. It seemed that the more they have

earned, the more demand of the quality of services provided. As they had a

larger spending power, it may increase the chances for them to consume in

organizations that provide high standard quality of products and serviced.

Therefore, they have experienced more about quality and lead to have

higher demand for the services.

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4.6 Analysis of importance of five dimensions of service quality

After analyzed the customer satisfaction based on the five dimensions of service quality,

it found that there were both satisfaction and dissatisfaction in those dimensions. It was

known that having improvements were needed in those unsatisfied dimensions, but

knowing which dimension was the most important according to the customers views

were also needed because having more understanding the customers, the more right

services to provide for them in order to gain more customer satisfaction, positive image

of brand and repeated business.

From the table 4.16 and the chart in figure 4.7, it could clearly see that the most

important dimension of service quality was responsiveness based on the respondents

point of view. For the mean of responsiveness, it had 4.3 rating that higher than the others

dim