factors influencing on customers' e-satisfaction: a case study from

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ijcrb.webs.com INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS COPY RIGHT © 2012 Institute of Interdisciplinary Business Research 1496 JANUARY 2012 VOL 3, NO 9 Factors Influencing on Customers’ E-Satisfaction: A case Study from Iran Bahram Ranjbarian Professor of Marketing, University of Isfahan Saeed Fathi Assistant Professor of Management Department, University of Isfahan Zeynab Rezaei MBA Candidate, University of Isfahan Abstract: Understanding of what creates a satisfying customer experience becomes crucial for online-stores success in attracting more customers to purchase through on line. This study is an empirical investigation which proposes and tests an "e-satisfaction" model. The adopted model, identifies five dimensions representing satisfaction with internet purchase experience and analyzes online-customers’ attitudes toward internet shopping based on their perception about the rule of convenience, the kind of merchandising, website design, security of transaction, serviceability in e-satisfaction. The statistical population of this research study was internet users and consumers of some Iranian internet shopping centers. The data was obtained through a field survey. The results revealed that four factors of convenience, merchandising, security and serviceability have influence on customer e-satisfaction but the influence of website design on e-satisfaction was not supported despite its indirect effect on security and serviceability. Finally, some strategic recommendations are proposed for customers’ e- satisfaction enhancement and also for further investigation. Key words: E-satisfaction, Internet shopping, Electronic commerce, Merchandising, Iran 1- Introduction: The collapse of large numbers of dot-com companies has required managers, who felt that the Internet had changed everything, to relearn that profits indeed do matter (Rosenbloom, 2002) and that the traditional laws of marketing were not rescinded with the arrival of the e-commerce era. Additionally, it has been reinforced that organizations not only need to attract new customers, but also must retain them to ensure profitable repeat business. [Anderson, 2003]. An increasing number and variety of firms and organizations are exploiting and creating business opportunities on the internet. Companies spend a lot of money on their websites to provide their customers with traditional functionality and a more

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

COPY RIGHT © 2012 Institute of Interdisciplinary Business Research 1496

JANUARY 2012

VOL 3, NO 9

Factors Influencing on Customers’ E-Satisfaction: A case Study from Iran

Bahram Ranjbarian

Professor of Marketing, University of Isfahan

Saeed Fathi

Assistant Professor of Management Department, University of Isfahan

Zeynab Rezaei

MBA Candidate, University of Isfahan

Abstract:

Understanding of what creates a satisfying customer experience becomes crucial for

online-stores success in attracting more customers to purchase through on line. This

study is an empirical investigation which proposes and tests an "e-satisfaction" model.

The adopted model, identifies five dimensions representing satisfaction with internet

purchase experience and analyzes online-customers’ attitudes toward internet

shopping based on their perception about the rule of convenience, the kind of

merchandising, website design, security of transaction, serviceability in e-satisfaction.

The statistical population of this research study was internet users and consumers of

some Iranian internet shopping centers. The data was obtained through a field survey.

The results revealed that four factors of convenience, merchandising, security and

serviceability have influence on customer e-satisfaction but the influence of website

design on e-satisfaction was not supported despite its indirect effect on security and

serviceability. Finally, some strategic recommendations are proposed for customers’ e-

satisfaction enhancement and also for further investigation.

Key words: E-satisfaction, Internet shopping, Electronic commerce, Merchandising, Iran

1- Introduction:

The collapse of large numbers of dot-com companies has required managers, who

felt that the Internet had changed everything, to relearn that profits indeed do matter

(Rosenbloom, 2002) and that the traditional laws of marketing were not rescinded with

the arrival of the e-commerce era. Additionally, it has been reinforced that organizations

not only need to attract new customers, but also must retain them to ensure profitable

repeat business. [Anderson, 2003].

An increasing number and variety of firms and organizations are exploiting and

creating business opportunities on the internet. Companies spend a lot of money on

their websites to provide their customers with traditional functionality and a more

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integrated marketing stream with the hopes of entering customers to purchase goods on

line. The key determinants of success or failure for e-commerce companies are not

merely web presence or low price but delivering right quality of e-service that causes

sophisticated online customers pay a higher price. The service quality has a significant

impact on customer satisfaction. Based upon the problematic and investigation

relevance of internet shopping , the propose of this research study is developed and test

a model of better understanding the factors that are most important in predicting

consumers' behavioral intention to purchase over the internet. Although research on

cognitive computing for insights into making the websites of internet shops more

competitive is very important and highly needed, the field is in its infancy and many

important research topics like e-satisfaction have not yet been studied conceptually and

empirically enough well.

Shoppers are very often of the "touch – and – feel" type, who prefer to handle and

compare goods before deciding to buy. Under these circumstances, it was important to

discover whether consumers perceived at the outset that virtual shopping over the

internet would engender a comparable experience, and how significantly life content

considerations tended to affect decisions to shop in this way. [Liao & Cheung, 2001]

Our objective is to provide the initial evidence for the determinants of e-satisfaction.

We examine and document the role of convenience, merchandising, site design,

security, serviceability in customer e-satisfaction assessments by rely on qualitative

evidence gathered through focus group tested to develop the conceptual model for the

investigation and then tested the model across a broader groups of online shoppers. We

close the study by discussing implications of the findings and directions for future

research.

2- Literature Review

While considerable research has investigated the drivers of service quality

and satisfaction in the offline environment (Zeithaml,2000), a small, but growing body

of research has examined the drivers in the environment in the online environment

(Francis ,2002 ; Donthu ,2001; Loiacono & et al ,2002 ; Srinivasan & Ponnavolu

,2002 ; Zeithaml & et al ,2000). Research on the basic questions - what drives

online satisfaction and retention - is still in the exploratory stage as both theory and

empirical investigations are emerging. From a broad perspective, the Internet is

a new technology and Web site satisfaction will be driven by ease of use

and usefulness (Davis, 1989). Davis argued that these two concepts are predominant

in predicting how much consumers will be using computer technologies.

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The ability to easily navigate a Web site and its perceived value (e.g. entertainment,

convenience, community) will influence both usage level and satisfaction. By

extension, satisfaction in the online environment may also be driven by

consumer benefits in using self-service technologies. As noted by Van Riel (Van

Riel, and et al, 2001) these benefits include convenience], saving time and money,

avoiding interpersonal interaction and being in control. This implies that the drivers

of Web satisfaction may include Web site characteristics (e.g. ease of use), the specific

Web site's value (e.g. useful information) and its relative value (e.g. more convenient

than offline shopping). A variety of independent and dependent constructs and

measures have been employed to identify the drivers of e-satisfaction. In short,

there is no consensus on what drives online service quality and e-satisfaction

(Zeithaml & et al, 2002).

While ease of use has various labels (e.g. site design, Web store functionality, ease

of understanding, ease of navigation) and different measures (e.g. easy to use,

easy to locate information, user friendly site) the underlying construct reflects the ease

with which an individual can navigate the Web site. Similarly, Website content has

various labels (e.g. product information, product attribute description, product

selection, product uniqueness, informational fit-to- task) and different measures

(e.g. product information meets my needs, extensive product selection, clearly

describes products), and the underlying construct reflects the depth of and information

on the products offered. A majority of the studies suggest a third driver, customer

security (e.g. financial security, security/privacy) which reflects the Web site's

information regarding its security policies. Beyond these three, there were

fewer consensuses on the remaining drivers either discussed or tested. These included

customer service, convenience, ease of ordering, and efficiency. Of interest to this study

was the role of customer service (e.g.care, responsiveness) which reflects the ability to

respond to questions, problems and after sale service. [Anand, 2007]

The Internet literature review (i.e. consumers’ reactions to Internet use about

information search and purchase experience) permits to identify and analyze the

relevant elements of e- satisfaction structure, needed to include as explanatory variables

in regression models developed in this study.

“Convenience” is the most important factor of consumers’ satisfaction with Internet

using and is related to speed, easy access to information at low cost (i.e. time, effort and

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displacement) where everything can be found in a minute without time or geographical

restraints. In the consumers’ perception, Internet shopping convenience is related to an

easy way of shopping and reducing total time spent on purchase (Szymanski & Hise;

2000; Kim & Lim, 2001), a pleasant way of shopping and delivery time (Jarvenpaa &

Todd, 1997; Alba et al, 1997) and the perceived relation - cost / delivery time (Shim et al,

2001). Additionally, the human interaction loss in electronics services and retail has

different effects on consumers’ satisfaction (Meuter et al, 2000; Forman & Sriram, 1991).

“Site design” quality depends on functional and attractive elements as: ease of

browsing, a standard language use, interface design, information search engine in

virtual stores, pages actualization, clear information contents, the largest number of

“clickable” items (Jarvenpaa & Todd, 1997), an organized presentation (Szymanski &

Hise, 2000), interactivity tools available, a good reality simulation and product’s virtual

experimentation possibility (Shim et al, 2001; Alba et al, 1997). Attractive web pages

presentation should contain animated gifts, sound, video and entertainment contents like

advertisement (Kim & Lim, 2001). However, some consumers react negatively to web

banners, because they interrupt and slow down a web page (Szymanski & Hise; 2000).

“Reliability” on Internet information search elements reveals a perceptual dichotomy

between consumer’s “reliability of the information content” and “reliability in control and

use of technology”. Information reliability is related with diversity, depth and actuality of

information contents (Szymanski & Hise, 2000; Kim & Lim, 2001). The capacity to

compare product’s information and the information search result depends on individual

capacity of Internet use and affects consumer’s satisfaction (Alba et al, 1997).

“Entertainment” is basically related to amusement and pleasure contents in Internet.

Kim & Lim (2001) concludes that entertainment is an important factor of consumers’

satisfaction with Internet shopping, and is associated to pleasure of browsing,

advertising and bonus offer in web sites. Entertainment is also associated to interesting

places to visit and shopping (Shim et al, 2001), and the possibility of animation through

virtual environments, minimizing the absence of human contact and amusement

associated to shopping (Jarvenpaa & Todd, 1997).

“Security” perception and privacy “assurance” with Internet shopping demonstrates to

have the biggest impact on e-satisfaction (Szymanski & Hise, 2000). Most researchers

also agree that the security problems (i.e. personal data transmission and payments with

credit cards) are the major risks affecting online transactions, acting as the principal

barriers to electronic commerce.

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Internet “product offer” is generally satisfactory for consumers, concerning product

diversity and available brands (Jarvenpaa & Todd, 1997) but doesn’t demonstrate a

significant impact on e-satisfaction (Szymanski & Hise, 2000). Other major critical

elements are related to risks inherent to catalog purchase: product performance (i.e.

guaranty, possibility of sensorial experimentation or product return) and supplier

confidence (i.e. unknown supplier with no physical address, non-fulfillment of delivery

promises) (Shim et al., 2001; Jarvenpaa & Todd, 1997). Other consumer’s expectations,

concern lower price products or a perceptual price/convenience relation (Jarvenpaa &

Todd, 1997; Bakos, 1997), transaction costs reduction and a higher delivery speed

(Shim et al, 2001; Alba et al, 1997). [Torres & Martins, 2004]

Analyzing consumers’ level of satisfaction has been of special interest to many

business people and academics, especially in the marketing field. Traditionally, the level

of consumer satisfaction is determined by the quality of services, the price level, and the

purchasing process. Consequently, the level of e-satisfaction is also determined by the

quality of e-services, the price level and the purchase process. Wang and Huarng

(2002) identified nine service quality factors that affect e-satisfaction through content

analysis of online customer comments in their research.

1. General feedback on the web site design,

2. Competitive price of the product

3. Merchandise availability

4. Merchandise condition

5. On-time delivery

6. Merchandise return policy

7. Customer support

8. E-mail confirmation on customer order

9. Promotion activities [Wang, 2002]

3- Conceptual Model:

A qualitative phase of research was initiated to identify possible antecedents to e-

satisfaction. Qualitative research for model formulation is advocated for areas such as e-

satisfaction that are ill-defined, under-researched, or relatively new (Miles and Huber-

man, 1994). The conceptual model of the study which presented in Figure 1 is one

outcome of this qualitative phase of research.

E-satisfaction is depicted in Figure 1 as the outcome of consumer perceptions of online

convenience, merchandising, site design, and security. Focus group members were later

contacted and asked to review the model. All agreed that the model adequately

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captured their sentiments regarding e-satisfaction. Interestingly, the elements captured

in the model also tend to be the ones discussed in the academic literature as

representing advantages or disadvantages of e-retailing (e.g., Alba et al., 1997; Ernst

and Young, 1999; Balasubramanian, 1997).

Table 1.Conceptual Model

Convenience

Shopping time

Convenience

Ease of browsing

Site design

Navigation structure

Web Design and interface

Fast Presentation

Customized content

Updated information

E-Satisfaction

Merchandising

Number of offering

Variety of offering

Quality of info

Quantity of info

Less searching cost

Security

Privacy

Financial security

Serviceability

Complaints Redressed

Customer support

Packing

Timeless of Delivery

Post Service

Competitive Price

Return Policy

Confirmation Email

Purchase Process

Feed back to site design

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Convenience

E-retailing is promoted widely as a convenient avenue for shopping. Shopping online

can economize on time and effort by making it easy to locate merchants, find items, and

procure offerings (Balasubramanian, 1997). Consumers do not have to leave their home

nor travel to find and obtain merchandise online. They can also browse for items by

category or online store. These time and browsing benefits of online shopping are likely

to be manifested in more positive perceptions of convenience and e-satisfaction.

H1: Shopping Convenience has influence on e-satisfaction of Internet shops customers

Merchandising

Positive perceptions of online merchandising represent another set of elements that

could positively impact e-satisfaction levels. Merchandising is defined here as factors

associated with selling offerings online separate from site design and shopping

convenience. This includes the product offerings and product information available

online.

It seems reasonable to expect that e-satisfaction would be more positive when

consumers perceive online stores to offer superior product assortments. For one,

superior assortments can increase the probability that consumer needs will be met and

satisfied. This is especially likely when consumers desire items not widely distributed

(e.g., specialty goods), produced in limited quantities, or unavailable at brick-and-mortar

stores because shelf space is limited. For example, a traditional book superstore may

carry 150,000 titles (Bianco, 1997), but an Amazon.com carries millions of titles. The

probability of locating any one title, therefore, would be higher at the online store. The

probability of consumers satisfying needs online would also be higher.

Second, the wider assortment of products can include items of better quality that may

be attractive to consumers. The lower search costs traditionally associated with online

shopping are thought to result in consumers buying better quality items (Bakos, 1997).

Buying better quality items, in turn, can improve satisfaction by delimiting the costs of

failed products. These costs include the costs of returning merchandise, losing face

when items fail, failure in one item causing failure in a related item (e.g., failed tires and

accidents), or failure creating an impediment to task completion (e.g., malfunctioning

computer and uncompleted tasks).

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Finally, we expect richer information (more extensive and higher quality) available online

to lead to better buying decisions and higher levels of e-satisfaction (Peterson,

Balasubramanian, and Bronnenberg, 1997).

H2: Merchandising has influence on e-satisfaction of Internet shops customers

Site Design

In addition to possible convenience and merchandising effects, the ambience associated

with the site itself and how it functions could play a role in whether consumers are

satisfied or dissatisfied with their online shopping experiences. Manes (1997), for

example, reports that good Web-site design is about good organization and easy

search. This includes offering consumers uncluttered screens, simple search paths, and

fast presentations. Moreover, each of these elements of site design could impact e-

satisfaction levels in the genre of a more pleasurable shopping experience being a more

satisfying one.

Shopping is thought to be pleasurable and satisfying to consumers when the retailing

sites are fast, uncluttered, and easy-to-navigate (Pastrick 1997). Fast, uncluttered, and

easy-to-navigate sites economize on shopping time. Uncluttered and easy-to-navigate

sites also economize on the cognitive effort consumers expend figuring out how to shop

effectively online

H3: Site Design has influence on e-satisfaction of Internet shops customers

Security

The security of online transactions continues to dominate discussions on Internet

commerce and perhaps with good reason. Bruskin/Goldberg Research, for example,

reports that 75% of Internet shoppers emphasize credit-card security as a major

consideration when deciding whether or not to buy items online. [Szymanski & Hise,

2000]

George (2002) examined whether privacy and internet trustworthiness helped deter-

mine attitudes towards the Internet. He hypothesized that the more experienced an

individual is with the internet, the more positive the individual’s beliefs about inter-net

trustworthiness. George also hypothesized that the more positive an individual’s

attitudes toward internet purchasing, the stronger the individual’s intent to make

consumer purchases over the internet.

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Lack of trust is one of the most frequently cited reasons for customers not shopping on

the internet. Security and privacy have an impact on customers trust in shopping on the

internet. The apprehensions of the customers regarding the security for online

transactions and authenticity of goods are curtailing the success of the e-shopping

model. More and more sophisticated customers would rather pay higher price to e-

shoppers who provide high quality services. Bruskin / Goldberg research, for example,

reports 75% of internet shoppers emphasize credit card security as a major

consideration when deciding whether or not to buy items online.[ Amoroso & Hunsinger

,2008]

H4: Security has influence on e-satisfaction of Internet shops customers

Serviceability

General feedback on the web site design , competitive price of the product ,

merchandise availability , merchandise condition , on-time delivery , merchandise return

policy , customer support , email confirmation on customer order , promotion activities

are the factors affecting the e-satisfaction and thereby the overall success of the e-

tailing site. the level of e-satisfaction is also determined by the quality of e-services , the

price level and the purchase process . Product delivery has the strongest influence on

customers' satisfaction and future purchase intentions.

H5: Serviceability has influence on e-satisfaction of Internet shops customers

4- Research Methodology:

With the qualitative findings as a foundation, the quantitative phase of research reported

next focused on surveyed data which empirically test the conceptual model of the study.

The customer’s e-satisfaction and its related variables have been measured on a five

point Likert - scale ranging from 1 to 5 with the following equivalences ,'' 1'' : '' strongly

disagree '' ; ''2'' : '' slightly disagree'' ; ''3'' : '' neutral '' ; ''4'' : '' agree '' ; and ''5'' : '' strongly

agree '' .

The samples were confined to e-shoppers in Esfahan, Iran. A questionnaire was

designed and pre-tested on 40 participants according to the standard approach and

subsequently was dispatched to 195 such individuals of different jobs and locations.

Usable responses to the survey were obtained from 181 shoppers (93%). SPSS 17

and AMOS Graphics 18 were employed in data analysis.

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Sample Characteristics

In its majority, the sample is composed by males and females, aged 20 to 40, with

academic education and occupation of college students and employees. All respondents

have a few years of e-shopping experience at least. The items which mostly purchased

by our subjects are internet and telecom services, educational materials, digital and

electronic components which also tend to be items purchased most frequently by

online shoppers. (See table 2)

Table 2.Sample principal characteristics

Demographic Characteristics F % Demographic Characteristics F %

Gender Male 86 48

E-Shopping

Experience

year))

Under 1 47 26

Female 95 52 1 to 3 67 37

Age

Under 25 76 42 4 to 6 44 24

26 to 35 74 41 Above 6 23 13

Above 36 31 8

Preferred

Items to

purchase

on-line

Movies 23 13

Education

Associate degree

& lower 51 28

Digital &

Electronics 27 15

Bachelor Degree 49 27 Educational

materials 37 20

Master degree 67 37 Make Up 13 7

PhD 14 8 Decorative 16 9

Profession

Low level jobs 46 25 Mobile & Laptop 11 6

High level jobs 23 13 Stock 14 7

Student 71 39 Internet and

telecom ser. 40 22

Self-employed 31 17

number of

website

visited

1 to 3 71 39

Working

experience

with

Computer

(years)

Under 5 33 18 4 to 6 46 25

6 to 10 78 43 7 to 9 25 14

11 to 14 46 25 Above 10 39 22

Above 15 24 13 Total 181 100

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Reliability and Validity

All indicators significantly loaded to a respective construct, proving unidimensionality.

The reliability of the research construct has been examined by Cronbach Alpha

coefficients; we found strong support for construct reliability.

The validity of the construct also has been examined by means of factor analysis.

Total scale showed relatively high Cronbach Alpha coefficients at α > 0.88 and all values

ranged from 0.70 for security to 0.83 for e-satisfaction.

5- Data Analysis:

Confirmatory factor analysis was conducted to determine the indicators (i.e.

measurement item) for each construct loaded as predicted on the respective construct

(i.e. e-satisfaction). We refined the scales by deleting items, that did not highly correlate

with other items measuring the same constrict. Through a series of scales purification

process, final acceptable CFA results were achieved for: CMIN/DF=2.371(Ρ-

value=0/000), CFI=0.95, AGFI=0.92, NFI=0.93, GFI=0.93, RMR=0.06, RMSEA=0.063.

Through CFA, we could confirm the presence of the construct (e-satisfaction) and the

five dimensions of e-satisfaction (i.e. convenience, merchandising, website design,

security and serviceability. (See table 3)

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Table 3: The result of the CFA on e-satisfaction

Item Description Regression

Rate

Cronbach's

Alpha

E-satisfaction

Familiarity satisfaction with e-shops 0.73

0.81

Satisfied with purchase from e-shops 0.8

Willingness to repeat the purchase from e-shops 0.82

Increase the frequency of visiting the e-shops 0.72

Recommend others to buy from internet e-shops 0.76

Satisfied with all facilities and services of e-shops 0.57

Convenience

Purchasing from e-shops is highly time saving 0.76

0.72 Purchasing from e-shops is easier 0.95

Searching the needed products in e-shops is easy 0.61

Merchandising

E-shops products is enough to answer the customers 0.52

0.73

E-shops products diversity is more than normal shops 0.52

Info quantity for website products is enough 0.8

The given info about website products is qualified 0.81

Cost of searching products in e-shops is low 0.51

Site design

E-shoppers are guided while searching products 0.68

0.71

Websites view and design is suitable and beautiful 0.51

Exploring speed of e-shops website on screen is good 0.54

E-shops website design is changeable by applicants 0.52

The information presented by e-shops is up to date 0.65

Security The financial security exists in e-shops 0.6

0.70 No need to worry for personal privacy in e-shopping 0.88

Serviceability

The customers claim in e-shops will be investigated 0.58

0.79

Special services are given in e-shopping 0.68

E-shops concern about packaging and quality 0.58

Delivery of products in e-shops is fast and on time 0.77

E-shops products are sent by prof. post services 0.52

Price of e-shops products is cheaper 0.55

E-shops products is always available to supply 0.53

The reimbursement of product is easy in e-shops 0.63

E-shops send approval email to customers 0.62

Purchasing process is e-shops is easy and pleasing 0.68

E-shops let customers comment about website design 0.54

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6- Result and Conclusion:

The hypothesized model is tested employing structural equation modeling using AMOS.

The overall fit of the model is acceptable. All the hypothesized paths are supported

except one path (i.e. website design e-satisfaction).

As shown in Table 4 and Figure .1, e-satisfaction is influenced by convenience (β

=0.38) supporting H1, merchandising (β = 0.41) supporting H2, security (β = 0.22)

supporting H4 and serviceability (β = 0.85) supporting H5 which compiles with most

previous researches. The findings doesn’t support H3,indicating that the website design

(β = - 0.22) has not a significant influence on e-satisfaction, which is opposing our initial

expectation and other researches that website design has influence on e-satisfaction,

e.g. Kim et al (2009 ) , Cai and Xu (2006) and Shankar et al (2003).

This purpose of the study was to develop and test an integrative model of e-

satisfaction by conceptualizing that e-satisfaction is influenced by convenience,

merchandising, security and serviceability aspects of e-shopping among which

serviceability considered to be the strongest predictor. The study supports mainly by

previous studies.

Table 4 .Standardized parameter estimates of the hypothesized paths

Hypothesizes Item Coefficient

(t-value) Result

H1 Convenience E-satisfaction

0/38 (4/80) Supported

H2 Merchandising E-satisfaction

0/41 (2/75) Supported

H3 Site Design E-satisfaction

0/22 (1/69) Rejected

H4 Security E-satisfaction

0/22 (1/98) Supported

H5 Serviceability E-satisfaction

0/85 (2/15) Supported

CMIN/DF=2.371(Ρ-value=0/000), CFI=0.95, AGFI=0.92, NFI=0.93, GFI=0.93, RMR=0.06,

RMSEA=0.063

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Figure.1. Summary results in the model of e-satisfaction process

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References

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[4] Anderson, Rolph and Srinivasan, Srini S. (2003), E-satisfaction and e-Loyalty: A

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