Sirdeshmukh, D., Singh, J. and Sabol, B. (2002), âConsumer Trust, Value and. Loyalty in Relational ...... RD Sharma and Hardeep Chahal. (1999), âA study of ...
CHAPTER 1 INTRODUCTION
1.0 An Overview of the Homestay Agro Tourism Agro tourism is a rural tourism concept in offering farmer’s experience to the tourist to allow them to experience the farmer’s daily life and visit their farm (Eduardo & Javier, 2006). Agro tourism is a form of tourism vacation by capitalizing on rural place and culture by offering real experience as a primary attraction. This concept is quiet similar to eco tourism in general however the difference is agro tourism will attract the tourist to cultural experience landscape compare to eco tourism in which offers tourist with natural landscape appearance. The homestay agro tourism is a new concept extended from agro tourism. Homestay agro tourism is accommodation and agro tourism concepts by mixing both activities in delivering tourist the experience in visiting farm, feel the farmer’s daily life and together with the accommodation with or surrounding the farmer’s plantation in rural area. Homestay means one type of tourism based from accommodation oriented with predesigned activities such as entertainment, education, food, enrichment, hospitality and accommodation components (Levitt, 1986). This is among popular tourism attractions for tourists who want to feel, interact and experience the local life style, social, community and culture in certain country (LTSN, 2003). In general, homestay is very different compared to other modes of accommodation such as hotel, motel or bed and breakfast which is normally located in the city or suburban areas whereas the location of the homestay is normally situated in rural areas (Salamiah et.al, 2011) where the whole community is still practicing the traditional way of life and embracing strong culture and traditional practices. Since the beginning of this concept in Malaysia, some operators have aggressively promoted and marketed their home stay product to overseas markets. As a result, their homestay have gained popularity especially among Japanese, Korean and Singaporean tourists (Jamilah et.al, 2007). As the program
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seems to become more and more popular, it garnered the confidence of many newcomers to join the industry (MOTOUR, 2011). In the world today, the concept of homestay agro tourism becomes popular and among largest industry in contributing to economy in particular country. The decline in agricultural economy output in many of developing countries due to human and external factors, homestay agro tourism has been recognized as an alternatives option to diversity in economic growth. Alternately, the agricultural economy has been significantly comparative stagnant over the past three decades (Beus, 2008) in which many of countries have switch the agro economy to competitive concept known as homestay agro tourism. Small enterprises farmers, the only way to stay by two options, first by increasing sales volume for maintaining agro business or second by diversifying their business to increase income. The farmers have to diversify their business that associated with agro economy. The main component in home stay agro tourism is visitor’s attraction in local people cultural diversity (Din and Mapjabil, 2010). The enhancing, promoting and improving of homestay agro tourism depend on both local communities and accommodation provided in ensuring of social, cultural and economic aspects with sustainable well being setting (Chaiyatorn et al., 2010). The homestay agro tourism should focus on emphasizing the communities’ emotional feeling and social return with well setting in social organizations, sense of place and be respectful of local heritage as essential elements for success (Beeton, 2006).
1.1
Background of Homestay Agro Tourism in Malaysia
In Malaysia, the unofficial homestay program started back in the early 1970’s by a local lady who goes by the name Mak Long. She started her service in Cherating Lama, Pahang by providing accommodation and also a village living concept which cater to tourists. (Amran, 1997). Subsequently, this concept became popular and other villagers followed the similar arrangement in gaining monetary benefit on influx of local and international tourists who are looking for culture experience and different travel experience.
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However, the definition and the context of homestay might be different in connotations and meanings from various countries. For instance in Australia, the term of homestay is associated with farmhouse accommodation and it catered mainly for students acquiring a place to stay when studying. In United Kingdom, the homestay concept is similar to bed and breakfast arrangements whereby the host offers accommodation for guests to stay in consideration for payment. There is limited interaction with no cultural involvement as it mainly involves only host and guest interaction per se and this is also quite similar in New Zealand. The Malaysian homestay is uniquely different with the full involvement of the guest to learn and experience the daily life of the host from the day they arrived to the day they leave place. The immersion of the guest with the homestay operator and the local community is highly expected as there are many cultural activities involved throughout their stay. The first homestay program began in 1988 at Desa Murni Homestay, started by five villagers using special program named as Desa Murni Perangkap, Desa Murni Ketam, Desa Murni Kerdau, Desa Murni Songsang and Desa Murni Sanggang. These homestay operators have been successful in gaining financial benefit by working together in creating homestay program (Kalsom, 2009). Thus, Malaysian government identified this opportunity as a platform to promote Malaysia tourism industry by implementing it in the National Plan for Rural Development (Liu, 2006). Moreover, Ministry of Culture, Art and Tourism has allocated special fund in expansion and assisted the homestay owner in stimulating their program. Due to that reasons, homestay was launched in 1995 in Temerloh, Pahang. Since then, it has spread to various states in the country including Sabah and Sarawak. As of 2010, there are 153 official homestay operators. All of the official home stay operators are registered and have been trained and licensed by the Ministry of Tourism Malaysia. The homestay sector, on this ground, is not only prosperous, but also provided with immeasurable business opportunities in tourism sector. In recent years, the operation of homestay has developed into an elaborate and specialized manner. With marketing and media promotion, it has become an important option where people engage in recreational activities and has further turned into an emerging sector with great potential.
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The government’s support is centred on focusing in many agendas, purposely for home stay development, because its significance potential growth and as a platform in promoting country’s tourism attraction as well as generate operator’s income and job opportunities for the communities. The homestay program has been proven successful in offering optional accommodation attraction to the tourist with various types of holiday programs to be chosen compared to other vacation packages and it gives more choices of flexibility and accommodation for them to travel (Chan et al, 2004). In real practice, the choice has been offered by the homestay for tourist is cheaper and with many extra rooms for tourist lodging. In order to safeguard visitors’ lodging interests, choices of recreational commodities and its safety, as well as maintaining the quality of recreational activities while enjoying the vocation, appropriate capital evaluation for Malaysia homestay quality validation should be set up by weighing up multi-aspect evaluating items so that it is applicable with impartial validation assessment and criteria could be accordingly established. The earlier homestay studies were mainly about customer satisfaction, marketing strategies, experiential marketing, operation and management, and consumer behaviours, but very few were focussing on the overall perspective to construct homestay capital evaluation framework. Furthermore, the homestay sector is showing a thriving trend and it is hoped that an evaluation mechanism could be formed through this research; notwithstanding, the main distinguishable features of homestay operation different from those of hotels are that home stays lay more stress on (1) inexpensive price and help-your-self-service, (2) not emphasizing luxury facilities, but aware of safety issue and hygiene facilities, (3) its service might not be full-scaled, but is with hospitality, local colour, and home-style. What is more important is that homestay make use of nature resources and local cultures in order to let visitors be able to experience the local and social customs in person. On top of these, homestay can provide functions like sport, recreation, amusement, and so on to make visitors fully enjoy their leisure time. On these accounts, it is obvious that the homestay and hotels vary in their functions, business model, and natures; therefore, if the hotel evaluation criteria are applied indiscriminately to home stays, it would appear to be unconnected and illogical. This research hence deems that it is vital and crucial to 4
develop and construct applicable homestay capital evaluation indicators, which is one of the motives. Malaysia began its post-Independence economy with an agrarian base, which has prepared it well to develop agricultural and commodities-based tourism, the hottest niche in eco-tourism today. Recognizing that agro-tourism holds a fascination for both Malaysians and visitors alike, organizers of excursions these days include tours to rubber and oil palm estates, as well as pepper farms, fish farms, flower nurseries and fruit orchards. Visits are structured around a tour offering insight into the cultivation, care, processing and manufacturing of these commodities for sale or export. The industry includes crops such as maize, cocoa, rubber, rice, fruits, oil palm and a variety of other products from which many Malaysians still earn a living. In tropical Malaysia, an amazing array of exotic fruits awaits the fruit aficionado all year around. Among the many choices are the rambutan, langsat, mangosteen, jackfruit, pineapple and mango. Visits to these fruit farms often involve tucking into ready-to-eat freshly picked fruits. Cameron Highlands, with its gentle slopes surrounded by loftier hills, is especially noted for its long-established estates. Agro tourism has the most excellent visitor facilities and provides guided tours of the tea factories. On rubber estates, visitors have the opportunity to experience first-hand how to tap a rubber tree and witness how latex is processed - from coagulation to pressing and smoking. Malaysia is among the world's largest producers of this extremely valuable and versatile product. Another country's largest export commodity is palm oil. Today, Malaysia is a world leader in the research and development of this multi-purpose fruit. The clusters of orange-red fruits produce refined cooking oil and other palm-olein products for use in the cosmetic and chemical industries. In the northern regions of Peninsular Malaysia, a number of spice and herb farms available at the countryside. Nutmeg is especially abundant. While over in East Malaysia, visitors to pepper farms in Sarawak will be fascinated to know that black and white pepper come from the same tree! The difference is achieved in the processing of the corns. White pepper is more mature, having been soaked and had its outer skin removed before drying, while black pepper is dried in its original state. A number of these destinations have stay-over facilities with a wide range of non-agricultural activities to 5
enjoy as well, including fishing, kayaking and nature walks. In many cases, full room and board packages are available, meaning that guests get to indulge in local home-cooking as well. Agro tourism has a number of attractions, both to the visitor and the host. While it provides for interesting visits and discovery, many of these centres also serve as research and development hubs for the perpetuation and improvement of the agricultural industry in the country. Tourism involves three main elements: the economy, society and nature. Mass tourism is, to date, the most profitable type of tourism worldwide, but this type of tourism also comes with an adverse impact on social and environmental aspects (Williams et al., 1997). The two key parties that are directly involved in tourism activities are tourists and locals. Tourists are groups of individuals who seek new experiences, goods, and excitement via the places they visit, while the local population is clusters of people that often experience a dilemma with respect to tourism. The increase in demand of tourism every year offers vast opportunities for homestay agro tourism to become more successful by offering new tourism product in Malaysia and benefited the agro economy rapid development especially to the communities and its operators. Homestay agro tourism has been identified as a unique vacation product in which culture and natural heritage appealing working together that gives tourist own experience in feeling (Intan et al. 2011). Thus, this program has good demand from local and international tourists and boosted the communities’ economy in home stay agro tourism that assisted in development of rural communities (Ibrahim et al., 2004).
1.2
The Growth of Tourism in Malaysia
Homestay agro tourism is a new concept; however, it achieves popularity in Malaysia since the country is rich with natural resources and accepted as important tourism asset. Significantly tourism sector has become the third largest income in Malaysia (Munan and Yuk, 2001). In early 2012, Malaysian Prime Minister launched the Economic Transformation Programme (ETP) to stimulate Malaysia’s aspiration of high income country by 2020 by tapping on the potential growth in tourism (Najib, 2011, New Straits Times, 2010). In order to achieve the vision, tourism has been identified as an important 6
factor for National Key Economic Areas (NKEAs) to propel this economic transformation. Thus, Malaysian Tourism Transformation Programme (MTTP) working together in formulating strategy in generating of RM168 billion by allowing around 36 million of international tourist in terms of tourist receipt (Ng Yen Yen, 2011).
Figure 1.1: Top 10 Tourist Arrival in Malaysia as at 2012
In 2010, tourism industry attracted around 12 million international tourists with total revenue of RM56 million. Business Mentor International (2011) reported that Malaysian tourism are expected to grow between 5 – 7 percents per year and expected to generate income of 32.6 million tourists in 2015. However in 2011, the tourist arrival is 24.71 million which ranked as 9th place most visited by the tourist according to United Nation World Tourism Organization (UNWTO, 2013) top ten highest tourists arrival countries. Based on Table 1.1 above, in 2012, Malaysian received 25.03 million tourists arrival in total compared to 2011 which only recorded 24.71 million tourists arrival for the same period. The increase growth of 1.3% in tourist arrival represents attractive and competitive option vacation to tourist with stability in politics, culture and economic. In 7
2012, among many countries, Singapore is the biggest contributor of Malaysia’s tourist arrivals by 13.01 million (51.99%). Other countries visited Malaysia are Indonesia with 2.38 million (9.52%), China for 1.56 million (6.23%), Thailand for 1.26 million (5.05%), Brunei for 1.26 million (5.03%), India for 0.69 million (2.76%), Philippines for 0.51 million (2.03%), Australia for 0.5 million (2.03%), Japan for 0.47 million (1.88%) and United Kingdom for 0.4 million (1.61%).
This data revealed that tourist receipt
increased by 3.9% in which generates RM60.6 billion compared to 58.3 billion in 2011. Tourist sector generated increasing distribution to the economy and anticipated to maintain of the country’s third largest foreign exchange income for country.
Figure 1.2: Domestic Tourism
From figure 1.2, the total domestic tourist has increased from 115.5 million tourists in 2010 to 131 million tourists in 2011 with total increased of 15.5 million (13.4%). For 2011, the excursionist is 85.27 million (65.09%) and tourist is 45.73 million (34.91%). This shows a significant positive growth in domestic tourists comparing from previous year of 2009 and 2010.
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Figure 1.3: Accommodation Occupancy Rate According to State/Federal
The figure 1.3 above showed that the highest occupancy is Pahang state increased by 5.1% from 75.3% to 80.4% in 2012. Second score is Putrajaya which increased by 0.5% from 66.8% to 67.3% in 2012. Kuala Lumpur is third largest score from 64.8% to 65.1%, increased by 0.3% in 2012. The lowest score is Negeri Sembilan with 36.3% in 2011 to 40.1% in 2012, increased by 3.8%. For 1st half in 2012, the increase rate of 3% to 60.6% is recorded compared to 2011 which is 57.6% for overall accommodation occupancy rate. In figure 1.4 below, Even though each home stay operator is responsible for preparing his/her home stay into comfortable and clean accommodation, the majority of them are not involved in marketing their home as individual home stay. Most of the homestay programs are actually groups of homestay homes that are managed by coordinating 9
groups, such as the homestay program committee. Some homestay program committees are extensions of the Village Welfare and Security Committee (JKKK) and others are registered co-operatives (Kalsom, 2009).
Figure 1.4: Homestay program and rural community development in Malaysia
1.3
Planning and Implementation Agencies
The success of the homestay program depends on the government’s involvement in the planning, organizing, implementing and also controlling of the program. Therefore, to ensure that the program is carried out successfully, it is essential that the government should be seen in all stages of the program. There are three main ministries that are directly involved in the planning and implementing of the program; Ministry of Tourism, Ministry of Rural and Regional Development, and Ministry of Agriculture (Figure 1). Each ministry has its own role and responsibility towards making the home stay program successful.
Ministry of Tourism (MOTOUR) MOTOUR is the direct owner of the homestay program under the category of rural tourism. It works closely with related agencies in developing tourism projects to reduce poverty. Amongst the responsibilities of MOTOUR are:
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provide directions, policies, and guidelines for the development of homestay program;
Provide funds for tourism infrastructure development, grants to upgrade homes of homestay operator. For example, the ministry has allocated RM5,000.00 to each house under the homestay program to upgrade the toilet;
Marketing and promotion through Tourism Malaysia such as preparing homestay directory for Malaysia, etc;
Work closely with state agencies such as State Tourism Action Council, Economic Planning Unit, etc.
Ministry of Rural and Regional Development (MRRD) The Ministry of Rural and Regional Development closely supports the homestay program in line with the mission of the ministry to promote rural development and modernization. The major focus is to uplift the socio economic conditions of the rural people and minimizing the rural urban divide. In the context of implementing the home stay program, MRRD is responsible for providing the infrastructure for rural tourism development such as roads, public toilets, and community multipurpose halls, improved landscape, public walkways, jetty, etc.
Institute for Rural Advancement (INFRA) INFRA is a training institute under MRRD that is directly involved in providing training and capacity building for the rural community. INFRA provides training to all homestay operators, communities as well as the Village Security & Development Committee (JKKK). JKKK is an official committee appointed by the state governments at the community level that has the responsibility for the security and development of the village. Thus, the implementation of the homestay program must be through the committee.
Ministry of Agriculture (MOA) The MOA also has contributed to the success of the Malaysian homestay program. Since, the program is located in the communal area, agricultural products or agro products are 11
amongst the attractions. Thus, the MOA engages in financial and technical assistance to improve value added activities (tourism) for the agriculture sector.
1.4
Potential Impact of Homestay Agro Tourism
The homestay agro tourism produces significant impact on domestic community for serving employment opportunity and revenue gained. In few decades, farming industry is adequately equipped with technological advancement and many small scale farmers completely found alternative source of income where agro tourism is effectively evident as source of stable income. Furthermore, agro tourism also provides opportunity for tourist to communicate with local community to experience and appreciate the local culture. The study on impact of homestay agro tourism in local community only focuses on positive impact, especially the changes in income aggregate and employment status. Many researchers consistent with the findings of impact agro tourism to income level on community. New England Agricultural Statistics (2005) showed that in 2000 and 2002 the total income from agro tourism increased to 86%. This study focuses on the increase of visitor to the Flower Fields in Carlsbad is significantly positive impact in economic to the company and the community has been considerable (Lobo et al, 2005). This implies to the benefit of homestay agro tourism motivation developments which are economic (McGehee et al, 2002). Gannon (1994) mentioned that homestay agro tourism is a solution for settlement in economic problem through employment creation, economic diversification, protection for both of natural and built environment, and infrastructural improvement. Hawaii Agricultural Statistical Office (2004) identifies that many farmers are engaged with homestay agro tourism in which majority of farmers has increased their income and revenue. This implies in on farm sale total for accounted 40%, and then followed by souvenir and retail sales for 26.8%, outdoor recreation for 14.8%, accommodation for 7.4%, education for farm tours for 3.5% and entertainment for 3.1%. Contini et al, (2009), identify that an increase of agro tourism in accommodation and restaurant by 6.6% in Italy have an impact on increase employment is 10.46%.
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There is possibility of increasing the numbers of tourist has increased the foreign exchange that will generate increases in Gross Domestic Production (GDP) as well as country’s income (History of Agro Tourism, 2008). Most of agro tourism provides together homestay in Malaysia. It becomes popular because of variation of races and cultural practices that attract many foreigners to feel and experience. This concept offers tourists to participate with activities and places to stay that fully monitored and arranged by the owner (History of Agro Tourism, 2008).
1.5
Research Problem
Today, homestay agro tourism providers compete in a highly competitive environment with hotel industry, tourism industry, agricultural industry and eco tourism. The direction, decision and strategy are fully sensitive to several issues and challenges shaping the competitive landscape that affects to long term operating environment and management impact decision. Therefore the term as customer satisfaction in service qualities are very much important to maintain or increase product equity among homestay agro tourism provider in Malaysia. It was noted that the success of agro tourism programs in certain villages are inter-related to particular operators and communities. Despite many studies reporting on the success of the agro tourism homestay program, there are findings from research undertaken by the Bureau of Innovation and Consultancy UTM (2009) indicating that some agro tourism homestay operators withdrew from being operators due to the lack of demand from visitors and tourists in a given period and therefore, no income generated. This issue has led to the interest for further investigation to understand the underlying causes of this scenario. Despite development funds having been injected by the Government into the community, research has remained to identify this problem in certain areas. Therefore, it is believed that if this problem could not be tackled soon enough, it could significantly impact the government’s objectives in increasing the economy of rural community through the homestay program under the Malaysian Village Action Plan Strategy.
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Therefore, further research needs to be done in order to enhance the body of knowledge by expanding research on finding of customer satisfaction towards homestay agro tourism. Each agro tourism homestay community could face similar or different challenges in managing the operation as they are likely to offer packages that do not meet the customers’ needs and wants. Hence, the majority of existing research could be biased, being restricted to a small sample size which may not be representative of the entire customers’ opinion towards agro tourism homestay program in Malaysia. It would seem that the challenges could be very different from one community of agro tourism homestay to the other. Many studies have been focusing on the evolution of the tourism events would impact the industry (Soutar, McLeod, 2003). However, there are other factors that would create sustainable community development such as communities’ participation and the agro activities. Generally, the lack of involvement and agro tourism activities from the rural communities and farmers would increase agro tourism home stay quality (Garrod, Wornell and Youell, 2006). Therefore, it is very important to understand the underlying problems relating to the quality factors in which influenced customer’s satisfaction on agro tourism homestay. Thus, the objective of this study is to explore the customers’ satisfaction in adopting homestay agro tourism in Malaysia.
1.6
Research Objectives
The researcher indicates and conducts a research on service quality dimension as a part of core factor to win over hospitality industry competitors. Today, the service quality becomes the main concern for many organizations in fast growing customer centric market (Vargo & Kucas, 2004) such as agro tourism industry. Significantly, the rationale of this study gives a clear idea of the importance of research in explaining specifically in determinant service quality factor that leads to successful agro tourism business. Researcher found that there are still subject areas to be investigated about the impact on service quality perception and expectation gap on customer’s satisfaction. Hence, the objective of the study is to determine key attributes for the success of homestay agro tourism in Malaysia. The objectives are as follows: 14
1.
To investigate the factors that contributes to the success of homestay agro tourism in Malaysia.
2.
To examine the relationship amongst factors concerning customer satisfaction on homestay agro tourism in Malaysia.
3.
To explore the level of customer’s satisfaction towards homestay agro tourism in Malaysia.
1.7
Research Questions
While the major factors are clearly defined, this study will try to answer the following research questions: Q1: What are the factors will contribute to the success of homestay agro tourism in Malaysia? Q2: What are the relationships amongst factors concerning customer satisfaction on homestay agro tourism in Malaysia? Q3: What are the levels of customer’s satisfaction towards homestay agro tourism in Malaysia?
1.8
Scope of the Study
Traditionally competition in Malaysia will be competing on price as their main strategy but they often miss out on the importance of current service, after sales service and support, and service quality. It will weaken homestay agro tourism provider value because even though price is vital to subscriber, it is not the main driver for customer satisfaction. Taking this into consideration, the empirical setting of the study will be based on factor that will influence customer satisfaction 15
The data collection for this study will be conducted by self-administered questionnaire, distributed by random sampling in Kuala Lumpur and using a survey website (https://drive.google.com) for respondents to take part in this study on internet. This research presents significant benefit to the marketer as well as home stay agro tourism provider especially to view, evaluate expectations, needs, wants and priorities to predict and generate among customer in service quality tendencies.
1.9
Significance of the Study
Homestay agro tourism industry has significant impact in terms of offering employment to the community as well as revenue to the operators. In fact, homestay agro tourism significantly as part of hospitality business that contributes to new jobs opportunities and rural area development. Besides, it provides special concept of vacation to visitors to be contacted and experienced local environment and cultures. Moreover, homestay agro tourism provider works together with local farmers to gain extra income through their traditional agricultural activities. Wider range of benefits has been identified as potential output of homestay agro tourism industry. The potential benefits of homestay agro tourism development in extend to local communities, local farmers and agro tourism provider. As such, the government and community would be benefited as diversification options for agricultural sector businesses (Williams, Pavidaan, Dossa and Dumai, 2001). Excellence in research findings delivered accurate and good results, and provide insights for homestay agro tourism provider, government agencies, academicians, marketers, intermediaries, students, parents, teachers and universities. This research identifies changes in many of dimensions, especially in culture practicing, economy, political and sociological by continuous metamorphosis of labour market. Theoretically, this study is very important to explain on consumer satisfaction in perceived service quality towards homestay agro tourism and moreover a research is based in Malaysian context.
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1.10
Organization of the Study
Basically, this is quantitative study and divided into five (5) main chapters:Chapter one pointed to explain an overview of the homestay agro tourism, background of homestay agro tourism in Malaysia, the growth of tourism in Malaysia, potential impact of homestay agro tourism, research problem, research objectives, research questions, scope of the study, significance of the study and finally organization of the study. Chapter two, explaining details and broader view in literature review. The reviews presented including introduction, overview on customer satisfaction, tangible, reliability, responsiveness, assurance and empathy. Chapter three is research methodology describe the variables, conceptual framework, research hypotheses, research design, population and sample, measurements and implementation, data collection, source of data, data analysis, reliability and validity, and finally validity testing. Chapter four present analysis of data and interpretation the findings of the study. The research discusses descriptive and inferential analytical by interpretation of the statistical findings. Chapter five explains in details based from the findings. Also discusses the limitation of the study, managerial implication, future research and provide conclusion for the whole of the study.
1.11
Summary of the Chapter
In this section, the researcher has acknowledged the issues relating to the importance of homestay agro tourism provider to focus on customer satisfaction due to high demand on ecology agriculture accommodation in Malaysia. Homestay agro tourism provider also needs to be aware of higher competition in today’s market, due to more hotel providers 17
and tourism accommodation providers coming to the markets. The significance of customer satisfaction is the deciding factor to determine a marketing formulation and approach for capability to retain customers in homestay agro tourism.
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CHAPTER 2 LITERATURE REVIEW
2.0 Background This chapter identifies an overview related to customer satisfaction towards of homestay agro tourism in Malaysia. Since this study discussed on quality service towards customer satisfaction attributes, the theoretical framework is outlined in this chapter as guideline to enable and execute research objective and answering research questions. In hospitality services industry, the sustainable competitive advantage of particular service industry, especially in occupancy rate needs to be acknowledged for both internal and external factor that homestay vigilant and aware of customer needs and wants. In fact, day by day the global competition and opening of foreign hotel operators has been seeing the potentiality of service industry growth in Malaysia. Alternately, this phenomenon highlights a tremendous urgency for homestay to further improve their company performance as tools in gaining advantage by identifying key areas to be improved in increasing occupancy rate as well as their internal factors. The rapid changes in hospitality such as limited resources, political, technological competition, demographic, social and legal that switch the customer’s demand, satisfaction, expectation and taste. Consequently, abundance of choices and unlimited desire of customers become major challenges to homestay agro tourism in facing an uphill battle to meet the demanding customers. In gaining competitive advantage, the conceptual models in service quality (SERVQUAL) assist the management in identifying quality problems that enable efficiency, improving profit possibility and overall performance (Parasuraman et al. 1988). Kazak (2001) supported the importance of customer satisfaction by identifying key element factor which affect tourists to visit a destination. This study is consistent with Tanja et al. (2008) which stated that satisfaction leads to willingness to pay more, intention to return and suggested the location to others. In other word, the service quality promotes customer satisfaction in which stimulates intention to re-purchase and return and encourage recommendations.
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The customer satisfaction increases market share, return on investment and profitability (Fornell, 1992). In order to increase satisfaction, the home stay provider must work in line with the product or services stand out among others by understanding their customer’s needs and wants. Thus, this study is set in analyzing the service quality dimensions by using SERVQUAL instrument in emerging market in which homestay agro tourism industry through competitive advantage comparative study between other hospitality industries.
2.1
Homestay Agro Tourism Success
Successful homestay agro tourism service provider relates to provider capabilities in assisting of in-house IT function especially in e-business data management, retaining staff, high level of expertise and services; particularly in shortage of certain IT skills and experiences staff in obtaining of fast moving business requirement (Willcocks and Sauer, 2000). When considering such capabilities, superior ability and offers that match the company needs and in-house option than homestay services become priority. The long term strategic core plan capability is something to look at by the company rather than just focusing in short term run that limits the company capabilities. There is a possibility that the core capabilities did not staffed suitably and first few years of homestay service neglecting of time horizon capabilities which lead to larger problem in further down line as decreasing in leadership ability, architecture planning and business system thinking. The success of homestay agro tourism service provider is determined by various factors including of internal and external factor that associated with the company’s competencies and capabilities. The competencies and capabilities can be perceived as generic and applicable across industries. The company’s internal competencies and capabilities are seemed to be the most important factors (Olorunniwo & Udo, 2006). This statement was consistent finding by Levina and Ross (2003) suggested that homestay agro tourism service provider capabilities element is most important factor in successful of homestay services which recognize capabilities in technical competence in the services being offered, maintaining the relationship management and identifying of customer’s business requirement. These include expectation gap between the customers and home stay agro tourism service provider in delivering better service quality to the potential and existing
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customers. Basically, this study is focusing on the common dimension of homestay agro tourism service success which taking into consideration the homestay achievement.
2.2
Empirical Framework of Service Quality
Service quality refers to an overall judgment of a particular service. It is based on the difference between expected quality and perceived quality. When quality is higher than expected, it can be termed as superior service. When the expected quality of a service equals a perceived service level, it is referred to as the general service quality. When the perceived service level is higher than the expected, it is referred to as better service quality. When the perceived service level is lower than expected, it is referred to as worse service quality (Iqbal, 2009). Service quality is a critical component of customers’ perception on value that determines the customers’ satisfaction. Customers perceive greater value for their money when they experience a high level of quality (Oh, 2000). By giving a good quality is an essential to the long term profitability for the homestay agro tourism provider. This is the key to improve profitability towards the organization (Anisah, Chew & Mohd Shaharuddin, 2008). Within the homestay agro tourism industry, a competitive advantage is best attained through service quality and customer’s satisfaction. As a result, service quality can be used as a competitive strategy. To achieve service excellence, homestay agro tourism providers must strive for “zero defects,” retaining every customer that they can profitably serve. The hospitality can use service quality to create a competitive advantage by emphasizing on the responsiveness and consistency of the service delivery.
2.2.1
The Service Quality (SERVQUAL) Model Instrument
Parasuraman, Zeithaml & Berry, (1988) initiate the SERVQUAL for the first created is 22 item of scale measure of service quality. This model has been frequently used by many researchers over several industries. Parasuraman et al., (1988) evaluated goods and services based on four characteristics: intangibility, perishability, heterogeneity and inseparability. Both service marketing and product marketing are present in distinct 21
situations because service quality is more subjective than product quality and it is also more difficult to evaluate. The SERVQUAL method is a technique that can be used to perform a gap analysis of an organization’s service quality performance against the customer service quality needs. Prabhakaran and Satya (2003) applied the SERVQUAL model in the study as measurement of service quality. Thus, SERVQUAL has been used to conceptualize difference between the service expected and perceived service on actual performance (Kara et al., 2005). It is an empirically derived method that may be used by a service organization to improve quality. It is widely used within the service industries to understand the perception of target customers regarding their service needs. It was originally measured on ten dimensions and by early 1990s; the model was refined to five dimensions as shown in Figure 2.1 (Zeithaml et al, 1990).
Tangible
Tangible
Reliability
Reliability
Responsiveness
Responsiveness
Competence Courtesy Credibility Security
Assurance
Access Communication Understanding
Empathy
Figure 2.1 Dimensions in the SERVQUAL model instrument
Adopted: Parasuraman et al., (1988)
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2.3 Service Quality in Homestay Agro Tourism Parasuraman et al. (1985) define service quality as customer’s expectation and their perception on prediction towards the services. Zeithaml et al. (1990), service quality is a customer’s perceptions on their personal judgement in terms of the services that the service provider gave and the customers could appreciate any service which exceeds their expectations. Generally, the quality is accepted as a main important factor that determines the customer demands on products or service, including main indicator which affects the competitive advantages of firms sector seems to be different from the term in the goods market (Havva Caha et al, 2006). Since the production in the service sector is generally an abstract term, evaluating service quality becomes more difficult than evaluating the quality of goods. Therefore, service quality measurements are, in general, made by the means of using consumer’s perception on the quality of the services. The product is tangible, it exist in which can be touched, feel or seen and is easy to be measured because it can attract anyway. However, service is hard to be identified and also to measure especially the quality (Lee et al., 2005). Parasuraman et al, (1985), define the service quality as the customer’s expectation and customer’s perception on how they predict towards the services. Berry et al, (1988), define service quality as something that leads to what customer expect to be the outcome. However, Zeithaml et al, (1990) state that service quality is the foundation of any customer’s perception on making decision to opt for specific service experiences on any services provider. Thus, customer will appreciate if the service quality exceeded their personal expectation on certain particular services. Parasuraman, Zeithaml & Berry (1988) developed Service quality (SERVQUAL) to measure service quality and this theory is most popular and frequently use across industries. Many researchers have identified that service quality is important factor that influence customer’s satisfaction (Kara et al., 2005). In measuring customer’s perception, their expression and imagination of their happiness regarding the accessibility and effectiveness is tool of sources. The customer’s needs and wants are essential to be understood as sources of information in order to deliver the services that meet their expectation. Research has shown that delivering quality service has a significant 23
relationship with the customer’s satisfaction (Kara et al., 2005). Product is easily to be measured because it can always attract but in service quality, it is so hard to define and also to measure (Lee et al., 2000). Definition of service quality given by Parasuraman et al. (1988) is something that leads to what the customers expect. Currently, the useful component to be considered as a care outcomes is the opinion of the customers. In measuring their perception by using their own imagination and expression of happiness is a good tool of sources. The customer’s needs are essential sources of information regarding the accessibility and effectiveness of care. Therefore, any care structure and plan should involve more customers in whatever decision that concern and importantly to meet their expectation. (Trop, 2008). Olorunniwo & Udo (2006) identify the importance of maintaining the customers confident in creating competencies and capabilities of homestay agro tourism. The success of homestay is supported by many factors and includes customer’s expectation, partnership quality arrangement and service quality being delivered to customers that contribute to customer satisfaction. The capabilities have been recognized as the most important factors in successful of service provider (Levina and Ross, 2003). Furthermore, the technical capabilities competency, business requirement and relationship management also affect to the success of homestay. The competences and capabilities are acting as perceived as generic and applicable across industries. Many organizations need to develop a long term strategic core capability rather than being drawn into firefighting and focusing only on short term capabilities in our framework. Problems developed when any of the core home stay capabilities are not suitably staffed, but there is also tendency in the first few years of a contract to neglect the capabilities with longer time horizons – business systems thinking, leadership, and architecture planning which leads to larger problems further down the line. This factor was consistent with Feeny et al. (2005) that identify in the study 12 competencies which grouped into 3 capabilities that winning the service provider contract. Those competences are area expertise, business management, behaviour management, sourcing, technology exploitation, process re-engineering, customer development, planning and contracting, organizational design, governance, programme management and leadership. However, the difference in purpose of industries that may expects to define different competences and capabilities that will be counted for renewing and winning of homestay 24
contracts. They are grouped within three major capabilities that each outsourcer should be looking for i.e., service delivery, relationship or partnership and transformation. In this study, homestay providers and customer are views of common definition for homestay agro tourism success that many hospitality service researcher always mentioned in their research even the control are vary from one another company (Lee, 2001; Lee and Kim, 2003). It is observed that taking benefits into considerations through the implementation of homestay from the view of customer and home stay service provider will enhance the possibility of success for organizations. The customer will look at diversification and specialization of the service satisfaction and at the same time homestay service provider will view of services performance to renewal or prolong the relationship in order to build customer confident. Thus service provider will be measured through their ability to satisfy customer mainly in term of the strategic, economic and technological benefits (Lee et al., 2001). There are further evaluation of success on relationship between customer and homestay agro tourism provider. This is depending on how relationship between them and how they are measure the service quality to achieve organization satisfaction. These mean by focusing on joint identification of the relationship strategic goal and a fundamental foundation for measuring compliance to the goals. The successful of homestay is the desired outcomes or benefits that were expected from hospitality service rendered by service provider in which can be viewed from several aspects such as financial, business, political and technical expectations (Lacity, Hirschheim and Wilcocks, 1994). These indicators are determining of success or failure and depend to customer perception of whether such services result the outcome of their services has met their expectation. As described in the previous segment, the most cited benefits of homestay either from customer perspectives or even home stay perspectives, the most critical are achieving cost savings, access to better services and the ability to focus on core competencies. As a result of these main motivators, compounded by inadequate specialized home stay staff and the inability of organization to retain their staff, therefore homestay provides a legitimate cause of action. Secondly, the desire to improve the service level expected by customers is also noted as a motivating factor for homestay agro tourism service.
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2.4
Customer’s Satisfaction Concept
The concept of customer satisfaction has highlighted to the attention of many service provider in early of 1970’s and in most of advance countries has becomes as major important determinant of customer’s satisfaction. The customer’s satisfaction is a concept that drawn a measurement to better understanding the criteria that meeting the customer’s expectation. These criteria include the customer’s demographic, staff behaviour, the service being offered, the environment and hardware that will result to the quality of service. From the marketing view for service sector, it has encouraged the concept of customer satisfaction in homestay agro tourism. It has drawn a measurement to better understand what criteria lead to the customer’s satisfaction. Generally, building the customer satisfaction is a backbone for many organizations. There are many factors that affect satisfaction including of courteous employees, helpful employees, friendly employees, knowledgeable employees, value, quick service, accuracy of billing, competitive pricing, billing timeliness, billing clarity and service quality (Hokanson, 1995). Many studies carried out in many countries, the factor such as perceived value and service quality are the key elements in customer’s satisfaction as well as ultimate results in prices, customer loyalty and trust. For an organization, it cares about revenue generating into the company. Services measurement has stressed marketing effort to increase sales even it is as empty resources to generate the income. However, studies have been conducted by the researcher by using their own experience and through interaction to the people concern and the expert. Using five construction scale as SERVQUAL (Parasuraman et al. 1985, 1991; Caraman, 1990) are not very popular in the measurement of customer’s satisfaction in service industry because the presence of global service quality domain (Sharma, 1996). In measuring the customer’s satisfaction, there are a construct to be used as a requirement. Currently the customer’s satisfaction is measured by using the attitude of regular or experienced of customers. With experience, it is assumed that they have formed a positive attitude because they have experience with the services rendered to them. . It will definitely reflect back to the provider about the quality of services. The study takes the customers’ experience that using the same service provider. The 26
customers who use the services provided by the homestay will directly relate to the service quality. Customers that have been using the same provider more than one time will have a good experience because they will reflect the good service quality of the provider. In determining the customer’s satisfaction, the provider will revise the attitude shows from the customers. Thus, to revise perception towards service quality satisfaction will moderate it and becomes a part of service quality and this goes on and on (Sharma et al., 1999). The factors contributing to the overall satisfaction is the perception of these qualities. In fact, environment like cleanliness, comfort, facility provided, appearance and etc. do effect the customers’ satisfaction (Woodside et al. 1989; Anderson, 1982). Brown and Swartz (1989); Parasuraman et al. (1988) and Crosby and Stephens (1987) said that in evaluating professional services, must undergo certain features for example communication, respect, helpfulness and etc. This is very important in determining the good value of customers’ perception. This also consistent with Harkiranpal (2006) and Zairi (2000) which identifies that the customers are the purpose on why the companies exist by today and rather than them depending on the companies, the companies are highly depending to them. Nowadays customers are educated, high purchasing power, demanded, highly awareness, curies and choosy in making intention to purchase. The customers are not the source of problem but actually opportunities for the companies to look at. That is the key reason for many of organizations today focusing on customer satisfaction, loyalty and retention. As a judgment method, customer’s satisfaction is recognized as a tool for a constructs (Zeynep & Karaman 2010). Customer’s expectation can be used by comparing their satisfaction with the provider using experience and performance accumulated from the service rendered. The four variables of quality services to be used are performance of environment, service performance, staff services, and quality of administration, agricultural based view and atmospherics. This entire variable was generated by discussion with the staff and subject experts and it covers all aspects. Hansemark and Albinsson (2004), identify that an emotional reaction experienced by the customers to the difference between on what customers receive and anticipate on the fulfilment of some goal or desire or need and the overall customer attitude represent the 27
satisfaction towards service provider. The customers’ retention is a prolonged commitment to do business or exchange in the future (Zineldin, 2000). Gerpott et al,( 2001), mentioned customer satisfaction is a direct determining of factor in customer loyalty and central determinant of customer retention. Thus satisfaction in itself will not major translate into loyalty. However, satisfaction will foster loyalty to the extent that it is a prerequisite for maintaining a favourable relative attitude and for recommending and repurchasing from the store. Oliver (1997) states that the customer loyalty refers to commitment to re-purchase a preferred product or service consistently in the future even influence by tough situational condition and marketing team efforts on potentiality to cause switching behaviour. Anderson and Jacobsen (2000) cited that the customer loyalty is results of an organization creating a customer’s benefit that will lead to customers maintaining or repurchase from the same organization. Another factor contributing to the overall satisfaction is attitude of customers. The customer experience in using the services would create positive or negative attitude on service being rendered which reflect back the service provider. Customer will direct related to the service quality and customers that use the services more than one time mostly satisfies with the services and will reflex the good service quality of the provider. Therefore referring to previous researchers finding, it can be concluded as customer satisfaction is important section to be considered. Hence, though customer satisfaction does not guarantee repurchase on the part of the customers but still it plays a very significant part in ensuring customer loyalty and retention. Socio-psychological theory definition shows that satisfaction is an expression of an attitude and it relates to the belief that will possess certain attributes. Customer’s satisfaction defined as the customer’s positive evaluation towards homestay dimension. Customer’s satisfaction is the comparison between the dimensions of the homestay with the individual’s frame of reference. Oliver (1997) states that customer assessment on particular products or services pleasurable level of consumption related fulfilment. Ikova (2004) identifies satisfaction influence the activities in which to conduct in order to achieve it and quality is an attribute of products or services received. Fundamental issue is to fulfil of customer needs in order to win customer satisfaction. Satisfaction customer in which the customers’ evaluation on particular products or services that meet their needs, wants and 28
expectation. It all about customer feeling or pleasure or disappointment which resulted from a process of evaluating which receive against that expected, the purchase decision and the fulfilment of needs and wants (Armstrong & Kotler, 2005). Bansal and Gupta (2001) mentioned that building customer loyalty is not a choice any longer with business, but it is only in building the company competitive advantage sustainability and as a key for customer to become a core marketing objective shared by key players in all industries which catering the business customers. Browen and Chen (2001) identify that satisfying the customer is not enough, the company need to extremely satisfy the customers because the extreme focusing to customers must lead to customer loyalty. Sivadass and Baker (2000) classified as satisfaction influence likelihood of recommending repurchasing but no direct impact on loyalty. However, Guiltinan, Paul and Madden (1997) identify satisfied customers are most likely to repeat and become loyal customers. There is link between customer satisfaction and company’s profitability. Common sense when customer satisfied with the product or services being offered that lead to repurchase, loyal and positive word of mouth marketing; and more changes in successful business (Zairi, 2000). However, dissatisfied customers responded differently which they will reduce the dissonance by returning or abandoning the product, or they may try to reduce the dissonance by seeking information that might confirm its high value (Kotler, 2000). Companies should handle customer complaints with care and not seeing them as time consuming. Businesses cannot afford under any condition to lose customers, because the cost of replacing the lost customer with a new customer is bigger. Therefore, companies must find ways of winning back the unsatisfied customers by designing special programs for service recovery. A traditional definition of satisfaction is the degree between customer’s perception and how to achieve it. Basically, we have to really understand about customer’s expectation before asking them about their satisfaction with the service they received. Consequently, the involvement of customers in the development of an instrument to measure satisfaction is vital and must be an integral part of development. Thus, satisfaction is a concept that cannot be assessed, which cannot be directly observed or measured. Doing a survey and observations are the most common method for obtaining the customers’ 29
views on their provider. Basic concept of satisfaction is the most widely used theories as the basic concept of expectation. In tourism research, customer satisfaction is a customer’s emotion after experiencing their vacation (Sanchez et al., 2006). Opposite to cognitive focus of customer perception is deemed as affective response to a products or services (Yuan and Jang, 2008). Destination is a holiday enjoyment experience by customer in the tourists feels that able to fulfill the tourists’ desire, needs, wants and expectation (Chen & Tsai, 2007). Hamburg et al., (2008), suggested that customer satisfaction has been a crucial issue in marketing fields in the past decades since satisfied customers are able to offer to continuous profitability, trust and customer loyal. If this customer satisfaction did not meet then customer feels dissatisfied and disappointed. Literatures had emphasized concept of customer’s satisfaction but no specific approach has been devised for its measurement. Due to the limitation, some authors have criticized that customer’s satisfaction is directly supported by the relationship between expectations and perception.
2.5
Service Quality
Service quality is a critical component of the customers’ perception of value that determines the customers’ satisfaction. Customers perceive greater value for their money when they experience a high level of quality (Oh, 2000). By giving a good quality is an essential to the long term profitability for the homestay provider. This is the key to improve profitability towards the organization. (Margolies, 1988). Within the homestay industry, a competitive advantage is best attained through service quality and customer’s satisfaction (Taylor, 1994). As a result, service quality can be used as a competitive strategy. To achieve service excellence, hospitals must strive for “zero defects,” retaining every customer that they can profitably serve. The homestay can use service quality to create a competitive advantage by emphasizing on the responsiveness and consistency of the service delivery. Service quality refers to an overall judgment of a particular service. It is based on the difference between expected quality and perceived quality. When quality is higher than expected, it can be termed as superior service. When the expected quality of a service 30
equals a perceived service level, it is referred to as the general service quality. When the perceived service level is higher than the expected, it is referred to as better service quality. When the perceived service level is lower than expected, it is referred to as worse service quality (Parasuraman et al., 1997). The customer satisfaction recognition and quality are closely linked to the customer retention and market share (Petterson & Spreng, 1997) and is not done by its own in producing customer lifetime value (Appiah, 1999). This is consistent with Liljander and Strandvik (1995) conclude that satisfaction will derive from the value of the service. This is a value that should be cared when dealing with customers because they will value on their own experience that they received. A discussion is still ongoing about whether customer’s satisfaction is a sequential order or a consequence of the service quality. (Andaleeb and Conway, 2006; Bitner, 1990). A group of researcher had made a conclusion that service quality is a global evaluation of a service and is the consequence of satisfaction perceptions over time (Parasuraman, Zeithaml, and Berry, 1985, 1988). Later, there is an argument that says the important component of satisfaction is service quality. Effective construct can be viewed as satisfaction and cognitive as a service quality. It will then turn as an emotive satisfaction assessment that drives behavioural intentions. In homestay agro tourism service provider, perceived service quality is a tool in generating customer’s satisfaction in making organization profit (Donabedein, 1996). The customers’ word of mouth regarding the service quality affect to the customer’s behaviour such as loyalty, preference and decision. As such satisfying them is better rather than receiving their complaint in which saves time and money. Rauyruen & Miller (2007), on the other hand, identified positive relationships between overall service quality, purchase intention and attitudinal loyalty. Similarly, Woo & Ennew (2004), found that service quality links with behavioural intention and customer satisfaction. Doney et al. (2007) argued that overall service quality affects trust, which in turn is recognized by many researchers as a key factor affecting successful relationship building (Rauyruen & Miller 2007, 24). In the homestay context, similar implications can be found. For example, Molinari et al. (2008) found that service quality is positive correlated with word of mouth, which can be considered one of the most effective types of marketing communication, by Zeithaml & Bitner (2003). 31
The measurements of service quality definition are used in the home stay industry will be applied in this study. In the literature concept, service quality and customer satisfaction will be related to each other. Long term judgment is perceived service quality whereas short term judgment is customer’s satisfaction with regards to the services by the provider. The differentiation from this result will derive an important measurement tools to the home stay industry. It will give a good development to long term attitude and short term customer’s satisfaction decision. Traditional service quality mainly concern about focusing hardly in customer market and service quality has often associated high level concept of customer satisfaction loyalty (Ma et al. 2005) and intention behaviour (Parasuraman et al. 1988, Zeithaml et al.( 1996). Zeithaml (2000) identify in their research that high level of service quality more often increased profit for that company. Thus service quality should be company’s priority. Definitions of service quality hold the result of an evaluation process where customers compare their expectations about a service with their perception of the service to be received. Parvez, (2005).
Parvez (2005), consider service quality as a significant
differentiator and the most powerful competitive weapon which all the service organizations want to possess. Various studies explained that the service quality as a form of attitude of customers on the service provider in a long run and also their overall evaluation. These two constructs for service quality and attitude are viewed as similar according to Parasuraman, Zeithaml and Berry (1988). Attitude is defined as a learned predisposition to respond to an object in a consistently favourable or an unfavourable way. Parasuraman, Zeithaml and Berry (1988) developed a service quality measure, SERVQUAL which measure of the overall service quality dimensions. Parasuraman et al, (1988), created service quality model (SERVQUAL) which based on four characteristic which are intangibility, perishability, heterogeneity and inseparability. The evaluation of service quality is complex and difficult to be measured compared to the product quality. Previous researchers have found measurement in service quality and created as service quality model by Parasuraman et al. (1988). This model is widely used within the service industries to analyze and understanding the customer’s perception in targeted market area in regards to their service needs. Scotti, Harmon, and Behson (2007) investigated on how a high performance work system can influence the staff personnel 32
towards customer’s perceptions of service quality and the customer satisfaction. Based on their report the argument support that perceived service quality is one of the factors of customer’s satisfaction. According to Parasuraman at.el, (1988) ,Service Quality is a 22-item instrument for assessing customer perceptions of service quality in service and retailing organizations .Parasuraman, Zeithaml and Berry (1988) developed this multiple-item scale consisting of five service quality dimensions: (1) Tangibles: The appearance of physical facilities, equipment, personnel, and communications materials; (2) Reliability: The ability to perform a promised service dependably and accurately; (3) Responsiveness: The willingness to help customers and to provide prompt service; (4) Assurance: The knowledge and courtesy of employees and their ability to convey trust and confidence; and (5) Empathy: The caring attitude which provides individualized attention to customers. With this instrument consumer expectations and consumer feelings concerning service quality are surveyed. Results can be used for the creation of benchmarks and to establish best practices for services by comparing the Service Quality scores of major competitors within the same industry. By measuring company specific Service Quality scores over several periods, trends can be established and analyzed. It was originated measure on ten construct and after, Zeithaml et al, (1990) refined to five dimensions and under this model the measured value in finding the difference between customer expectations and perceptions cross five determinants as follows:
Tangibility:
Physical facilities, equipment and appearance of personnel.
Reliability:
ability to perform the promised service dependably and accurately.
Responsiveness: willingness to help and provide prompt service. Assurance:
knowledge and courtesy of employees and their ability to inspire trust and confidence.
Empathy:
caring individualized attention the firm provides to its customers
Figure 2.2: The SERVQUAL Instrument 33
The SERVQUAL presents service quality as a discrepancy between a customer's expectations of a service and their perception of the service received, requiring respondents to answer questions concerning both expectations and perceptions. The measurement of perceptions as opposed to actual service received makes the SERVQUAL a measure of attitudes that is related to but not the same as, satisfaction (Parasuraman et al., 1988). Parasuraman et al. (1991) revised the original SERVQUAL measure to remedy problems with high means and standard deviations found on some questions and to obtain a direct measurement of the importance of each construct. The present study applied the SERVQUAL to measure the international customer’s satisfaction in these five dimensions.
2.5.1
Tangible
Tangible is anything in a service provider that physically observed by customer, who is purchasing a service, including equipment, personnel, physical facilities, materials and appearance. A well equipped home stay will definitely can handle customers who mostly demand for a better or highly professional services. This includes home stay equipment being updated and renewed frequently to maintain high technological standards, comfortable rooms and facilities together with the neat appearance of home stay staff personnel. A home stay location is also considered as a tangible attribute. This statement was cited by Zarina Ismail (2009), as the appearance of physical facilities, equipment, personnel, and communication material of an organization is the tangibles. Parvez (2005) added that customers look for quality in the equipment, facilities, and communication materials used to provide the service. These qualities provide concrete cues for customers to evaluate the capability of the service provider. Well-skilled first line personnel, the quality of products, brochures and cards, may represent homestay agro tourism provider tangibles.
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2.5.2
Reliability
The reliability is a trust to company’s ability of performing service in a proper way, such as acting according to promises and declarations. This reflects the ability to perform a service dependably and accurately. It is one of the most important service components for customers (Berry & Parasuraman, 1991). Zarina Ismail (2009) reliability is defined as the ability to perform the promised service dependably and accurately is the reliability. Churchill & Peter (1999) stated that customers want performance to be consistent and dependable. A reliable homestay provider means the competency to provide superior products or services that are working at desired level of throughput, without significant failures, according to declarations and agreement between home stay service provider and user.
2.5.3
Responsiveness
Responsiveness is service provider’s willingness to help customers and provide prompt service. It represents the willingness of staff personnel to provide services promptly and in a timely manner. As mention by Zarina Ismail (2009) responsiveness is the willingness to help customers and provide prompt service. Churchill & Peter (1999) added that customer must see service provider as ready and willing to perform their said service. It can be measured by the amount of time needed to deal with customers’ reported problems and the response duration once the customer filed a service request. For example, responsiveness of home stay service provider evaluates the time taken to response with customer’s complaints on problem solving and feedback to the customers.
2.5.4
Assurance
Assurance is the knowledge and courtesy of employees and their ability to inspire trust and confidence. This reflects the knowledge and courtesy of staff personnel and their ability to inspire trust and confidence in using the English Language for communication. It includes the ability to provide clear explanations before care is given together with the 35
explanations of service to customers before they are discharged. As stated by Zarina Ismail (2009), assurance means the knowledge and courtesy of employees and their ability to convey trust and confidence. Since risk (such as money loss) is involved when customer decides to acquire service from a service provider, assurance is important to demonstrate cue to increase customer’s trust and confidence. Homestay service provider may demonstrate assurance to customers by behaving courteously and by providing essential knowledge to guide customer’s problems.
2.5.5
Empathy
Empathy refers to the caring, individualized attention by Homestay Agro Tourism to its customers. It involves caring, individualized attention of staff personnel, where communication in the English Language is also a factor. Cited by Zarina Ismail (2009), empathy means the provision of caring, individualized attention to the customer. In conclusion, the SERVQUAL is an instrument for organizations to better understand the customers’ value and how well their organizations are meeting the needs and expectations of the customers. In relation to service quality and customer satisfaction, many researchers have been more précised on meaning and type of measurement of satisfaction and service quality. In deed satisfaction and service quality are more in common thing, whereas satisfaction is looking from a broader concept and service quality only focuses on service dimensions (Wilson et al., 2008). Zeithaml et al, (2006) mentioned that perceived service quality is a component of satisfaction even though added another element of price and product quality. This theory was confirmed by many researchers which started from the idea of Wilson et al., (2008).
2.6
Homestay Agro Tourism Success
There are a few factors that have been identified as impacting the success of home stay agro tourism. These include the expectation gap between customers and service quality includes the service delivery arrangement as well as customer satisfaction adopted that by home stay agro tourism. The success of homestay agro tourism arrangement is determined by numerous factors. According to Olorunniwo, Hsu & Udo (2006), 36
capabilities and competencies seem to be some of the most important. For instance, Levina and Ross (2003) showed that capabilities of organization have been recognised as the most important factors for the success of organization. According to them, organization’s capabilities comprise its technical competence in term of product and services offered, understanding the customer’s business requirement, and relationship management. These capabilities and competences can be perceived as generic and applicable across industries. However, one has to be careful because for different industries one may expect to find different capabilities and competences that count for winning and renewing the business contract. For instance, in the case of hospitality industry, as in Feeny et al. (2005) proposed that there are 12 competences grouped within 3 capabilities that are very important for winning the business. Those competences are area expertise, business management, behaviour management, sourcing, technology exploitation, process re-engineering, customer development, planning and contracting, organizational design, governance, programme management and leadership. They are grouped within three major capabilities that each outsourcer should be looking for i.e., service delivery, relationship or partnership and transformation. Homestay agro tourism providers’ ability to understand and manage customer expectations is identified as a key contributor to the overall success of service delivery. Often the customer’s expectations exceed the service provided, and hence the customer perceives that the home stay agro tourism provider is not fulfilling the business requirements as cited by Watson, Pitt & Kavan (1998). Also Walsham (2006), quoted that in an effort to measure the customer’s perception of the service delivered, service organizations often use end user satisfaction and customer satisfaction models. Olorunniwo, Hsu, & Udo (2006) mention base on Parasuraman et al. (1986) defined the SERVQUAL model to measure service quality. SERVQUAL models Hochstein, A. (2004).
Further refinement produced the
These models measure the customer’s
perspective of the service rendered and do not take into account the service provider’s views or opinions. Kim et al. (2005), argue that models that only evaluate the customer or end user’s satisfaction and disregard input from the service provider are not adequate to measure the overall success of the service provided
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2.7
Theoretical Framework
The theoretical framework is the foundation on which the entire research is based on. It is a logically developed, described and elaborated network of associations among the variables deemed relevant to the problem situation and identified through processes like observation and literature review. Thus, the theoretical framework is an entire research foundation and the basis of whole research. It is a logically developed, described and elaborated network of associations among the variables deemed relevant to the problem situation and identified through processes like observation and literature review. The theoretical framework represents and elaborates the relationships among the variables, explains the theory underlying these relations, and describes the nature and direction of the relationships. Based on the literature review and observation of the customers intention to purchase of herbal health and medicine products, a model indicating the customer’s perception was developed. The model consists of five factors that were determined to have an effect on the customer’s perception towards intention to purchase of herbal health and medicine products.
Service Quality elements
Tangible
H1
Reliability
H2 Responsiveness
H3
Overall Satisfaction
H6
H4 Assurance
H5 Empathy
Figure 2.3: Theoretical Framework of the Research
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Homestay Agro Tourism success
Wright (2000) stated that the research has been defined as the collection of data from a sample of community members or organizations with respect to their impressions, behaviour, opinions and attitudes toward the specific product or service. Research information has a value whether to organizations that provides services or products or the individuals who use these products or services. Also, the research has systematic information as pointed out by Hair (2008). Research is the systematic process aimed at finding solutions to specific problems or answers specific questions by using certain methods that can lead to acquisition of new scientific methods and helps to make decisions by managers in the companies. Based on development of theoretical framework in figure 2.3 above, there two types of variables available in this research namely independent variable and dependent variable. Whereas independent variable is about consumer’s perception toward overall satisfaction with mediation variable and dependent variable is about consumer’s purchase intention. Under independent variable there are five (5) factors that have been developed which are tangibility, reliability, responsiveness, assurance and empathy, which are factors determinant in influence of consumer’s satisfaction that lead to intention to purchase. The researcher will investigate whether the independent variables influence factor towards mediating variable and has influence ability to make them intention to purchase home stay agro tourism. This study also makes sure investigation will run on correlation between independent variable and dependent variable.
2.8
Chapter Summary
This chapter has presented related theories and previous research on customer satisfaction. It explains the conceptual part of the study. Also in this chapter, the background of the study will be discussed along with homestay agro tourism success, service quality in homestay agro tourism, customer satisfaction concept, service quality, customer satisfaction and chapter summary. These factors are determinant factor influence people behaviour in adopting of homestay agro tourism. The next chapter will discuss on the research methodology being used in this research.
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CHAPTER 3 RESEARCH METHODOLOGY
3.0 Introduction Methodology can be a documented process for management of projects that contains procedures, definitions and explanations of the techniques used to collect, store, analyse and present information as part of a research process in a given discipline. Methodology may refer to nothing more than a simple set of methods or procedures, or it may refer to the rationale and philosophical assumption that underlie a particular study relative to the scientific method. According to the American Heritage dictionary, methodology can be properly referred to as the theoretical analysis of the methods, appropriate to a field of study or to the body of methods and principles related to a branch of knowledge. Therefore, there are two helpful research methodologies: qualitative and quantitative. The qualitative is a research aim in depth study for understanding of human behaviour and answering the question on why they act on such behaviour. The qualitative will study on the question on “how” and “why” they performed such behaviour. However, this study ignores the question of “what”, “where” and “when” and the sample of respondents is relatively small. The quantitative research refers to empirical investigation in systematic method by using numerical data, mathematics, statistical analysis and computation technique by employ of theories, produce hypotheses and mathematical model to answer the research question and research objectives. These method measures the relationship between mathematical impression and empirical observations. Bryman and Bell (2003) pointed out that the connection between theory and research, epistemological considerations and ontological considerations, quantitative and qualitative research can be considered as two distinctive clusters of research strategy. They also suggested that quantitative research can be construed as a research strategy that emphasizes quantification in the collection and analysis of data and that:
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i)
Entails a deductive approach to the relationship between theory and research, in which the accent is placed on the testing of theories;
ii)
Has incorporated the practices and norms of the natural scientific model and of positivism in particular; and
iii)
Embodies a view of social reality as an external. Objective reality
Due to the purpose of this research is to test the proposed hypothesizes, a quantitative method is chosen in this research.
3.1
Variables
This study identifies the success factor for homestay agro tourism with the relevant attributes of service quality and customer’s satisfaction. Each variable may have different effect as on determinant factor that could lead the success of homestay agro tourism. The framework was developed based upon the review of the literature which illustrates the relationship between both the independent and dependent variables that have a direct impact on the success of homestay agro tourism. Variables are characteristics of importance that take different values in different items. The two types of variables available in this research are the dependent variables and independent variables. The goal is to understand and describe the dependent variable, or to explain its variability, or to predict it. In the case of this research, the dependent variable (i.e., finding the variables that influence it) is the customer’s perception towards home stay agro tourism. Independent variable is one that influences the dependent variable in either a positive or negative way. That is, when the independent variable is present, the dependent variable is also present, and with each unit of increase by the independent variable, there is also an increase or decrease by the dependent variable. The independent variables involved in this research are tangibles, reliability, responsiveness, assurance and empathy dependent variable is customer satisfaction. A
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logical explanation (a theory) is needed on why the independent variable affects the dependent variable.
Independent variables
Mediating variable
Dependent variables
Tangible
Customer satisfaction
success of homestay
Reliability
agro tourism
Responsiveness Assurance Empathy
Figure 3.1: The list of variables
Several measures were carried out to ensure the validity of the study in which data was collected by random sampling, reliable sources, respondents who are experienced in using homestay agro tourism; survey question were structured based on literature reviews and frames of references to ensure the validity of the result; questionnaire was pre-tested by the respondent before the actual survey begins by at least forty respondents and finally data was collected within a period of two weeks and no major event changed with the related topic.
3.2
Hypotheses Development
Hypotheses were logically conjectured relationships between two or more variables expressed in the form of testable statements. A hypothesis is a specific statement of prediction. It describes a concrete (rather than theoretical) term of what you expect to happen in the study. The relationships were conjectured based on the conceptual framework formulated for this research in the previous section. The hypotheses test would help to prove the theories proposed in the study. After the theorizations of
42
theories, conclusions will be made and provide better guidance for readers and future researchers. Five hypotheses were formulated to test whether there are significant relationships between the service quality determinants of tangible, reliability, responsiveness, assurance and empathy; and customer’s perception of success homestay agro tourism. The five (5) hypotheses have been developed to help answering answer the key questions pertaining to the customer satisfaction on factor for the success homestay agro tourism. 3.2.1
Tangible
The measurement of perceptions as opposed to actual service received makes the SERVQUAL a measure of attitudes that is related to but not the same as, satisfaction (Parasuraman et al., 1988). The SERVQUAL presents service quality as a discrepancy between the customer's expectations of a service and their perception of service received, requiring respondents to answer questions concerning both expectations and perceptions. The present study applied the SERVQUAL to measure the international customers’ satisfaction in these five dimensions. A homestay agro tourism tangible attributes must be efficient and well-equipped to handle customers who generally demand high quality professional services. This includes hospitality service equipment being updated and renewed frequently to maintain high technological standards, comfortable rooms and facilities as well as neat appearance of place and facilities. A homestay location is also considered a tangible attribute. Hence, the following hypothesis is constructed: H1:
Tangible has a significant positive relationship on the customer satisfaction
3.2.2
Reliability
Reliability refers to the service provided by management and staff within the promised timeframe. This reflects the ability to perform a service dependably and accurately. It is one of the most important service components for customers (Berry & Parasuraman, 1991). The staff services in handling the customers and the promises towards the quality 43
delivered to produce excellent service will be measured by the customers. This also leads to customer satisfaction when they are comfortable with the service being received and the more chances for any successful business as customer satisfaction leads to repeat purchase, brand loyalty, and positive word of mouth marketing. Customer satisfaction leads to repeat purchases, loyalty and to customer retention as in Zairi, (2000). Thus below mentioned hypothesis was developed:-
H2:
Reliability has a significant positive relationship on the customer satisfaction.
3.2.3
Responsiveness
Responsiveness represents the willingness of management and staff to provide services promptly and in a timely manner. Kheng, Mahamad, Ramayah & Mosahab, (2010) in their study on 238 bank customers in Malaysia have found that reliability is found to have positive relationship with customer satisfaction that create loyalty. Significantly, responsiveness hypothesis was developed:H3:
Responsiveness has a significant positive relationship on the customer’s satisfaction.
3.2.4
Assurance
Assurance reflects the knowledge and courtesy of staff to inspire and trust and their ability to have the knowledge. It includes the ability to consistently provide courteously and must be able to build the confidence in customers. Besides that, the staff must be able to provide safety to customers when dealing with them. On this basis, it is expected that assurance affects the customer’s satisfaction in homestay agro tourism.
H4:
Assurance has a significant positive relationship on the customer satisfaction.
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3.2.5
Empathy
Empathy involves caring. Individualized service is given, where the staff must be able to understand a patient’s specific needs. Kheng, Mahamad, Ramayah & Mosahab, (2010) in their study have found that empathy is found to have positive relationship with customer satisfaction that creates loyalty. Therefore, empathy hypothesis was developed:-
H5:
3.2.6
Empathy has a significant positive relationship on the customer satisfaction.
Customer Satisfaction
Customer satisfaction has argued to be one of the significant contributors towards the explanation of the factor may influence successful of homestay agro tourism. This is because the more customers are satisfied with products or services being offered, the more chances for any successful business as customer satisfaction leads to repeat purchase, brand loyalty, and positive word of mouth marketing. Customer satisfaction leads to repeat purchases, loyalty and to customer retention as in Zairi, (2000). Thus, sets directions and prioritizes strategy for the new business engagements. The present of customer satisfaction in pricing and overall satisfaction perhaps as a factor might have given a moderating effect to the relationship. Even if with high service quality or/and partnership quality but overall customer dissatisfy with the results from a process of evaluating what was received against that expected it will impact to the success of home stay agro tourism. Therefore, customer satisfaction hypothesis was developed:-
H6: Customer satisfaction has a significant positive relationship on the success of homestay agro tourism.
In conclusion, the SERVQUAL is an instrument for organizations to better understand what customers’ value and how well their organizations are meeting the needs and expectations of customers. Thus sets directions and prioritizes homestay strategy for the new customers’ engagements. Even with high service quality but overall customer 45
dissatisfy with the results from a process of evaluating what was received against that expected it will impact to the success of homestay agro tourism.
3.3
Research Design
Research can be classified in terms of their purpose. Accordingly, Saunders, Lewis & Thornhil (2003) mentioned that they are most often classified as exploratory, descriptive or explanatory while Cooper and Schindler (2003) categorized it as descriptive and causal. Simply put, the essential difference between descriptive and causal studies lies in their objectives. If the research is concerned with identifying who, what, where, when, or how much, then the study is descriptive. In a causal study, we attempt to explain the relationships among variables. A research design is a framework or blueprint for conducting a marketing research project (Sekaran, 2003). The research design adopted for this study was the descriptive design and hypothesis testing. Sekaran (2003) explained that descriptive research is used to describe something, usually the characteristics or functions of the variables of interest. For descriptive research, it begins with the defined structure and proceeds to actual data collection in order to describe the variables. The key to good descriptive is knowing exactly what to measure and to select a survey method in which every respondent was willing to cooperate and capable of providing accurate information.
According to Sekaran (2003), descriptive studies that present data in a meaningful form help to:
Understand the characteristics of a group in a given situation.
Think systematically about aspects in a given situation.
Offer ideas for further probe and research.
Help make certain simple decisions.
Hypothesis testing was used to explain the nature of certain relationships, or establish the differences among groups or the interdependence of two or more factors in a situation. 46
For the case of this project, the situation was the determinant factor for homestay agro tourism service provider. Hypothesis testing was undertaken to explain the variance in the dependent variables or to predict outcomes. The emphasis here is on studying a situation or a problem in order to explain the relationship between variables (Saunders, Lewis & Thornhill 2003). The purpose of this research is to provide a descriptive research. The data that have been collected through questionnaires are aimed to understand the most important factors of service quality in homestay agro tourism.
3.4 3.4.1
Population and Sample Population
The population consisted of adult respondents with or without homestay customer experience from various groups of demographic, different employment backgrounds and education levels within a high population area. These groups of people may or may not have the experience of using home stay facilities. They were chosen due to the easy accessibility of the researcher. Easy access helps to save cost, time and other resources. 3.4.2
Sample
Since it is impossible to collect data from the entire population, a sample is selected for this research. A sample is a subgroup or subset of the population. Data for this study are collected by the means of a survey conducted at home stay. A total of 200 questionnaire forms were delivered to respondents. The locations of respondents are within Klang Valley. By studying this sample, conclusions can be drawn to generalize the interests of the population. 3.4.3
Sampling Method
A simple random sampling is obtained by choosing elementary units in search of a way that each unit in the population has an equal chance of being selected. A simple random sample is free from sampling bias. However, using a random number table to choose the elementary units can be cumbersome. It can be said that using a sample in research saves 47
mainly cost and time, if a suitable sampling strategy is used, an appropriate sample size is selected and necessary precautions are taken to reduce on sampling and measurement errors, then a sample should yield reliable information.
3.5
Questionnaire Design
The research used survey as the main method strategy to research. In this survey, selfcompletion questionnaire with closed questions are developed. The self-completion questionnaire is very similar method of business research, and the research instrument has to be especially easy to follow and its questions have to be particularly easy to answer (Bryman and Bell, 2003). Meanwhile, whether to ask a question in an open or closed format is one of the most significant considerations for many researchers. According to Bryman and Bell (2003), closed questions have some advantages: it is easy to process answers; it enhances the comparability of answers, and makes them easier to show the relationship between variables. It is better than open question for this research. Yin (1994) has recognized five popular ways of collecting and analyzing empirical data in business research. It includes experiments, survey, and analysis of archival information, histories and case studies.
To enhance reliability and validity, great care is ensured while designing the questionnaire. 40 structured questions were used to measure the five key constructs identified. Every question in the questionnaire focused directly on a specific issue and it is ensured that the questions have brevity and clarity. While designing the survey instrument, it is ensured that instrumentation bias is avoided. The questionnaire also stated clearly the intentions of the research. Then, the questionnaire included instructions on how to answer the survey questionnaire to ensure valid survey results. The questionnaire consisted of questions that are related to the background of respondents and possible factors affecting the perception of services offered in private clinics. The Likert five point scales ranging from “strongly agree” to “strongly disagree” were used as the basis of questions.
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Structured questions are questions that offer the respondent a closed set of responses from which to choose. Structured questions make data collection and analysis much simpler and they take less time to answer. Structured questions are best suited in the following situations: first, when you have a thorough understanding of the responses so that you can appropriately develop the answer options, and second, when you are not trying to capture new ideas or thoughts from the respondent. Structured questionnaires were used to ensure standardization among the respondents and also during the compilation of data. Structured questions are a set of questions which respondents answer in a fixed set of response alternatives. These are also referred to as close-ended questions. The combination of structured questionnaires consisted of dichotomous, multiple-choice and Likert Scale method and open-ended questions. Of the 43 questions, eight (8) were related to the demographic characteristics whereas the remaining addressed the various constructs of the study and 35 questions is represent the each variables questions. Point scales ranging from “strongly agree” to “strongly disagree” were used as the basis of questions. The questionnaire is developed. Part A revolved on the demographic questions from these questions; the researcher knew about background of respondents. Part B consisted of the tangibility, reliability, responsiveness, assurance and empathy questions. From these sections, the researcher analyzed and predicted the customer satisfaction towards homestay agro tourism. A preliminary version of the questionnaire is developed in the English language on the basis of past researches and the measures were translated into the Malay language so that the two versions are reasonably comparable.
3.6 Pilot Test A pilot test is conducted to detect the weaknesses in design and instrumentation and to provide proxy data for the selection of a probability sample. It should, therefore, draw subjects from the target population and simulate the procedures and protocols that have been designated for data collection (Cooper and Schindler, 2003). According to Cavana, Delahale and Sekaran, (2001) a questionnaire should be piloted with a reasonable sample of respondents who come from the target population or who closely resemble the target population. Before distributing the questionnaire, it is piloted with forty (40) customers
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to ensure that the language is concise and easy to understand. It is then modified and improved prior to data collection.
3.7 Reliability Coefficient In measurement studies, the researcher may test the hypothesis to ensure that the coefficient is similar for all constructs. According to Cavana, Delahale and Sekaran, (2001) the reliability of a measure the extent to which the measure is without bias (error free). The reliability of a measure indicated the stability and consistency which the instrument measure the concept and helps to assess the goodness of a measure. Consistency reliability or Cronbach’s alpha measures how well a set of items (or variables). Cronbach’s alpha is computed in term of the average inter correlations among item measuring concept. The closer reliability coefficient gets to 1.0 the better. The Cronbach’s alpha, is a measure of internal consistency, that is, how closely related a set of items are as a group. The closer the Cronbach’s alpha coefficient is to 1.0, the greater the internal consistency of the items in the scale. George and Mallery (2003) provided the following rules of thumb:
> 0.9 – Excellent 0.8 – 0.9 Good .7 – 0.8 Acceptable 0.6 – 0.7 Questionable 0.5 – 0.6 Poor < 0.5 – Unacceptable
While the increase of the value of alpha is partially dependent upon the number of items in the scale, it should be noted that this has diminishing returns. An alpha of 0.8 is probably a reasonable goal. It is also noted that while a high value of Cronbach’s alpha indicates good internal consistency of the items in the scale, it does not mean that the scale is one-dimensional.
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Table 3.1: Pilot test reliability output Variables Service Quality (SERVQUAL)
Construct
Item in
Cronbach’s
Tangibles (TG) Reliability(RE) Responsiveness (RS) Assurance (AS) Empathy (EM) Customer Satisfaction
scale 5 items 5 items 5 items 5 items 5 items 5 items
Alpha 0.831 0.665 0.749 0.901 0.895 0.899
Homestay Success
5 Items
0.732
35 items
Total
The results in Table 3.1 indicate high values of Cronbach’s alpha ranging from 0.665 to 0.901. Norusis (2002), quoted the good scales have values larger than 0.8. Other results show high values of Cronbach’s alpha. This indicates that all the constructs are measuring the concepts for this study, thus suggesting that the instrument is reliable. After factor analysis and reliability assessment were conducted, the concept of summated scale is applied. Summated scale is a method of combining several items into a single composite measure in an attempt to increase the reliability of the measurement (Hair et al., 1998). Therefore this study considered the average score of items from each dimension to represent an estimate of a construct.
3.8
Descriptive Analysis
Descriptive analysis in the forms of mean and standard deviations for all variables were conducted to obtain a general profile of the distribution of the responses and characteristics of the sample for the study
3.8.1
Inferential statistics
To test the hypotheses developed in this research, inferential statistics is being employed. Inferential statistics for this research included correlation analysis, Pearson Correlation, multiple regression, one way ANOVA and independent t-test were done to enable 51
researcher to correctly and meaningfully interpreted the data in answering the objectives of the research. Prior to performing the inferential statistical analysis, the level of significant of 0.05 was determined as critical level for decision making. Decision about hypotheses are according to the significant level where p=0.05, or at 95 percent confident level in which any amount more than significant level of p value 0.05 is where the hypotheses will be rejected.
3.8.2
One way ANOVA analysis/independent sample t-test
One way ANOVA and independent sample t-test are used to test whether there is significant difference in the mean of customer satisfaction in relation with demographic element such as gender, age, race, race, religion, education, employment status, annual income and nationality. In other hand, the test seeks to identify whether these demographic elements have any influence on customer satisfaction to home stay agro tourism.
3.8.3
Pearson correlation
For this study, Pearson correlation analysis is being used to assess whether the five hypotheses and customer satisfaction have significant relationship to each other. This scale suggested by Hair et al., (2003) is used to describe the intensity of relationship between the independent and the dependent variables of the study. This analysis is used to test the relationship between independent and dependent variables. In Pearson correlation (represent by symbol of r) and the term r is a measure of linear correlation of two variables. It is a number that range between -1 to 0 to +1, representing the strength of the relationship between two variables. An r of +1 denote for perfect positive relationship between two sets of number and -1 denote as perfect negative relationship which indicate inverse relationship between two variables as one get larger and other one gets smaller. The r value of “0” mean no linear relationship is present between two variables. The formula represent as below:-
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3.8.4
Multiple Regressions
Multiple regression analysis is a technique that can be used to explore the relationship between one continuous dependent variable and predictors (Pallant, 2001). Multiple regressions could provide information about the model as a whole and the relative contribution of each of the variables that wake up the model. The multiple regressions equation as follows:-
Multiple regression model without Moderating variable y = α + β1x1 + β2x2 + β3x3 + β4x4 + β5x5 Where α is the intercept point of the regression line and the y axis, β is the slope of the regression line, y is customer satisfaction of home stay agro tourism (CS), x1 is tangibility (TY), x2 is reliability (RY), x3 is responsiveness (RS), x4 is Assurance (AE), and x5 is Empathy (EY). To see the regression equation using of formula: y = α + β1x1 (TY) + β2x2 (RY) + β3x3 (RS)+ β4x4 (AE)+ β5x5 (EY). Whereas:α + β1xi is define the predictable part of any y score for fixed value of x. y is considered the predicted score.
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This equation the value of α and β can be through of as values that maximize the explanatory power of predicted accuracy x in relation to y. Thus in maximizing explanatory power or predictive these values will minimize prediction error.
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CHAPTER 4 DATA ANALYSIS AND FINDINGS
4.0 Background of Research In chapter three the research methodology was discussed and the questionnaire is design, construction and administration analyzed. The results and a report of the empirical study will be presented in this chapter. This chapter emphasis the findings in details on result generated from the study. Mainly the discussions will be based on research objectives and hypotheses that identified earlier in previous chapter. Data are processed by SPSS software in version 17.0 and presented in the tables. Data were analyzed by using several methods such as:
Descriptive Statistic
Mean and Standard Deviation
T-test
One-way ANOVA
Correlation
Regression
4.1
Respondent Rate
A set of 220 questionnaires were distributed to the respondents, whom were public and private sector employees in Kuala Lumpur. But only 200 respondents have been answered the questionnaires. During the two weeks given for completion and returning the survey, 120 (54.55%) surveys were received in first week of March 2014 and 80 (36.36%) in second week of March 2014, the balance of 20 surveys (9.09%) was not returned by respondents. The cut-off date was given up to 16th March 2014. Table 4.1 shows the survey returns rate from two week of March 2014 by the respective respondents. All the questionnaires were usable for data analysis.
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Table 4.1: Response Rate Total
Percentage (%)
Questionnaires distributed
220
100.00
Collected questionnaires
200
90.91
20
9.09
Uncollected questionnaires
4.2
Demographic Profile Analysis
The demographic descriptive statistics characteristics were helpful in best describing the sample. The descriptive statistics including of frequencies and measures of central tendencies and dispersion were used to describe and to explore the demographic variables of gender, age, race, religion, education level, yearly income and nationality. Table 4.2 below, summarizes the descriptive statistics of the respondents according to demographic information such as gender, age, race, religion, education level, yearly income and nationality. In the first category by gender, majority of the respondents were male (52%) for 104 respondents and the remaining are female (48%) represent for 96 respondents. From the 200 respondents, in the second category, the respondents’ age for this study are categorized by five different status and only four were used to be analyzed because for age 50 and above, there were no respondents. In this study, the highest respondents are 21 to 30 years age for 78 respondents (39%), followed by age 31 to 40 for 63 respondents (31.5%), third category for 43 respondents for age below than 20 years and finally above than 50 years of age (8%) for 16 respondents. Another respondents profile is classified according to their race, where most of the respondents are Malays with 118 respondents (59%), Chinese (17%) with 34 respondents, followed by Indians (19%) with 38 respondents and finally other races (5%) with 10 respondents. The education of respondents are divided to five categories, first is PhD for 1 respondent (0.5%), Master level for 13 respondents (6.5%), Bachelor degree for 17 respondents (8.5%), Diploma holder for 44 respondents (22%) and other level of education for 125 respondents (62.5%). Main employments are fulltime employment (58%) for 116 respondents, part time employed (32%) for 64 respondents and self employed (10%) consist of 20 respondents. The majority of yearly income earned for 56
RM30,001 to RM40,000 (39%) for 78 respondents, followed by income level from RM40,001 to RM50,000 (23.5%) for 47 respondents, third is income from RM50,001 to RM60,000 (13%) for 26 respondents, fourth is income from RM20,001 to RM30,000 (12.5%) for 25 respondents, fifth is income level of below than RM20,000 (8%) for 16 respondents and income above than RM60,000 (4%) of 8 respondents. Majority of respondents are Malaysian nationality for 142 respondents (71%) and balance of 58 respondents (29%) is non Malaysian. Table 4.2: Frequency distribution of the respondents’ according to their demographic Profile Variables
Frequency
Gender Male Female Age 25 and below 26 to 30 31 to 40 41 to 50 Above 50 Race Malay Chinese Indian Others Religion Islam Buddha Christian Hindu Others Education PhD Master Bachelor Diploma Others Employment Full time employed Part time employed Self employed Not employed
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Percentage (%) 104 96
52.0 48.0
43 78 63 16 0
21.5 39.0 31.5 5.8 0
118 34 38 10
59.0 17.0 19.0 5.0
132 20 31 17 0
66.0 10.0 15.5 8.5 0
1 13 17 44 125
0.5 6.5 8.5 22.0 62.5
116 64 20 0
58.0 32.0 10.0 0
Income Below RM20,000 RM20,001 to RM30,000 RM30,001 to RM40,000 RM40,001 to RM50,000 RM50,001 to RM60,000 More than RM60,000 What is your nationality? Malaysian Non-Malaysian
16 25 78 47 26 8
8.0 12.5 39.0 23.5 13.0 4.0
142 58
71.0 29.0
4.3 The Influence of Demographic Elements on Overall Satisfaction This section focuses on examining whether demographic elements namely – gender, age, race, religion, education level, yearly income and nationality are significantly related to success factor for homestay agro tourism in Malaysia. For this purpose independentsample t-test and one-way analysis of variance (ANOVA) were used.
4.3.1 T-test of data collection According to Coakes and Steed (2007), basically the using of t-test is to determine whether there is exists relationship between two sets of scores. T-test has three main types which are one sample, independents group and repeated group. In this research, independent sample test has been used in order to examine whether “sector which respondents were in” is significant towards success of homestay agro tourism. The result of t-test is shown in table 4.3. Coakes and Steed (2007) further explained in determine accepting and rejecting hypothesis is by analyzing Levene’s test which has value greater than 0.5. Then can be assumed that the population variances are relatively equal. They elucidated in their notes, “the two-tail significance for without additive indicate that p > .05 and, therefore is not significant. Therefore you can accept the null hypothesis and reject alternative hypothesis, Sekaran and Bougie (2010).
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4.3.1.1 Gender and overall satisfaction An independent samples t-test was conducted to see whether there is significant different in the mean of customer satisfaction score for male and female. The result of t-test is shown in the table 4.3. This findings indicate that there is significant differences in overall satisfaction between two sector (t value = 41.789, P = 0.000). As the probability error is below than 0.05 (p=0.000 < 0.05). Therefore, it can be concluded that the genders of respondents do influence overall satisfaction. Table 4.3: T-test between Gender and Overall Satisfaction One-Sample Test Test Value = 0 t
df
Sig. (2-tailed)
Mean
95% Confidence Interval of the
Difference
Difference Lower
GENDER
41.789
199
.000
1.480
Upper 1.41
4.3.2 One Way ANOVA Analysis One way analysis of variance (one way ANOVA) is a statistical test used to compare the mean of three or more independent sample group (SPSS base 2.0 User’s Guide, 2003). This test will determine whether there is a significant difference in population mean from which the sample were represented. ANOVA also is a statistical technique for examining the differences between two or more populations. F test is a statistical test which is used to test equality of variance of two populations. Sekaran and Bougie (2010) clarified that the results of ANOVA show whether or not the means of various group are significantly different from one another, as indicated by F statistics. 4.3.2.1 Age group Table 4.4 the one way ANOVA shows that significant level at p = 0.839. Since the p value is above 0.05, this can be conclude that there is no significant difference in overall satisfaction based on their age (F = 0.669, P = 0.839). Thus, age does not have any influence on overall satisfaction. 59
1.55
Table 4.4: ANOVA comparing overall satisfaction across age group ANOVA AGE Sum of
df
Mean Square
F
Sig.
Squares Between Groups
9.757
18
.542
Within Groups
146.723
181
.811
Total
156.480
199
.669
.839
4.3.2.2 Races group Table 4.5 below, explains that there is no significant relationship between customer satisfaction over race group as f value is 1.493 and p=0.097 which is more than 0.05 and this can be concluded as race has no impact to overall satisfaction. Table 4.5: ANOVA comparing overall satisfaction across races group ANOVA RACE Sum of
df
Mean Square
F
Sig.
Squares Between Groups
23.009
18
1.278
Within Groups
154.991
181
.856
Total
178.000
199
1.493
.097
4.3.2.3 Religion group In the religion group, there is significant value of f=0.861 and p=626 as table of 4.6 below. As the p value is more than 0.05, it indicates that there is no relationship between both variables and religion group among the respondents has no impact towards overall customer satisfaction.
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Table 4.6: ANOVA comparing of overall satisfaction across religion group ANOVA RELIGION Sum of
df
Mean Square
F
Sig.
Squares Between Groups
16.454
18
.914
Within Groups
192.101
181
1.061
Total
208.555
199
.861
.626
4.3.2.4 Education group Table 4.7 below shows ANOVA result between education group and overall satisfaction resulted that significant level of f=2.087 and p=0.008. As the p value is less than 0.05, it indicates that there is relationship between both variables and education level among the respondents has an impact towards overall satisfaction. Table 4.7: ANOVA comparing of overall satisfaction across education group ANOVA EDUCATION Sum of
df
Mean Square
F
Sig.
Squares Between Groups
29.531
18
1.641
Within Groups
142.264
181
.786
Total
171.795
199
2.087
.008
4.3.2.5 Employment group Table 4.8 the one way ANOVA shows that significant level at p = 0.107 and f=1.465. Since the p value is more than 0.05, this can be concluded that there is no significant difference in overall satisfaction based on their employment status (F = 1.465, P = 0.107). Employment status does not have any influence on overall satisfaction.
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Table 4.8: ANOVA comparing of overall satisfaction across employment group ANOVA EMPLOYMENT Sum of
df
Mean Square
F
Sig.
Squares Between Groups
11.437
18
.635
Within Groups
78.483
181
.434
Total
89.920
199
1.465
.107
4.3.2.6 Income group Table 4.9 shown one way ANOVA results that significant level at p=0.720 which is the p value is more than 0.05. This can be concluded that there is no significant difference in overall satisfaction based on (F = 0.782, p=0.720). Income does not have any influence on overall satisfaction. Table 4.9: ANOVA comparing overall satisfaction across income group ANOVA INCOME Sum of
df
Mean Square
F
Sig.
Squares Between Groups
20.931
18
1.163
Within Groups
269.289
181
1.488
Total
290.220
199
.782
.720
4.4 Descriptive Statistics of Data Collections According to Coakes and Steed (2007) descriptive statistics are used to describe, examine and summarize the main feature of a collected data quantitatively. Therefore, descriptive statistics are describing what the data shows. Basically, this is the methods used to organize, display, describe and explain a set of data with use of tables, graphs and summary measures (Norusis, 1999). Respondents were asked to indicate their perceptions and agreement towards the statements in the questionnaires, using the five points Likert-Scale answer. This scale were ranged between 1 = Strongly Disagree to 5 = 62
Strongly Agree. Based on their score for each statements, researched had found the average score (mean) for each variables. This value was then categorized to the following to indicate their level of perceptions towards all variables: 1.0
to 2.33 = Low
2.34 to 3.63 = Moderate 3.64 to 5.00 = High It is found in table 4.10 that tangibles towards overall satisfaction among respondents were high (mean = 3.8100, sd = 0.82687). For reliability towards overall satisfaction were score moderate (mean = 3.4610, sd = 0.84976). Responsiveness variable is holding at moderate (mean = 3.4950, sd = 0.73585) state that majority of respondents are influence by service quality of agro tourism operator
in order to have overall satisfaction,
assurance is holding at moderate level (mean = 3.2990, sd = 0.79065) referring that organization assurance is an important factor for people’s in making their confident in performing satisfaction, empathy have score at moderate level (mean = 3.1120, sd = 0.79259) as moderate mean and overall satisfaction at moderate mean (mean = 3.1030, sd = 0.82254). Therefore, most of the respondents have the perception to create customer overall satisfaction and loyalty. Table 4.10: Descriptive (Mean and S. Deviation) Analysis of the variable Descriptive Statistics Mean
Std. Deviation
N
Tangibles
3.8100
.82687
200
Reliability
3.4610
.84976
200
Responsiveness
3.4950
.73585
200
Assurance
3.2990
.79065
200
Empathy
3.1120
.79259
200
Satisfaction
3.1030
.82254
200
Success
3.7330
.75960
200
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4.4.1 Tangibles Figure 4.1 shows mean of Independent Variable “tangibles” stated at 3.81, indicating high level of tangibles among respondents towards the overall satisfaction. Majority of respondent have scored for agree as tangibles are important factor for prolong relationship between the service provider and the customers. This signifies a high level of satisfaction by the respondents on the relevancy of the elements in ensuring people satisfaction on tangibles. However, there are only few respondents disagree with the tangibles as a factor of building customer overall satisfaction in which who are score for mean less than 2.
Figure 4.1: Tangible
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4.4.2 Reliability For reliability the score is moderate with the value of mean at 3.46. This indicates that reliability values are most importance factor for them to create their satisfaction. Majority of respondents have been chosen agree to the reliability value as a factor in creating customer satisfaction and intention towards purchasing of agro tourism services. However, there are few respondents choosing disagree as they have experienced using tourism services and they are presumed that having or not having of agro tourism are no difference from normal tourism services to them. Obviously, as today’s world of agro tourism industries is a vital role in connecting people with environmental vacation in which anybody who love and care for natural environment will experience a different vacation.
Figure 4.2: Reliability
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4.4.3 Assurance It was found that this element was moderate satisfied variable with the mean of 3.30. Majority of the respondents agree with the assurance of agro tourism organization is a factor in people perform in satisfaction. It was indicated that the respondents were of the opinion that the assurance were really supportive in enhancing customer overall satisfaction. However, there are few respondents answered the question with strongly disagree and disagree because for them the assurance is not an issue.
Figure 4.3: Assurance
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4.4.4 Empathy The elements on empathy value showed a relatively moderate rating. The mean scores recorded for these elements were 3.11. The readings can be interpreted as an average moderate, a sign of acknowledgement by the respondents that these elements contributed towards changing to customer satisfaction. Majority of respondent were answer for neither agree nor disagree. From the chart, the peak score is at 2.7 in which the respondents might think that the empathy value maybe yes or not directly effect to the customer overall satisfaction and for them the empathy value somehow on position unknown. However, the majority of respondents would agree with this question and the empathy value is importance in creating customer overall satisfaction.
Figure 4.4: Empathy
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4.4.5 Overall satisfaction The elements on overall satisfaction showed a relatively moderate rating. The mean scores recorded for this element was 3.10. The majority of respondents are choosing for “neutral”. The readings can be interpreted as high moderate of satisfaction and a sign of acknowledgement by the respondents that this element highly contributed towards overall satisfaction. However, there are few respondents answered for “strongly disagree” and “disagree”. This is simply because some of respondents experienced bad services that lead to dissatisfaction.
Figure 4.5: Overall Satisfaction
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4.4.6 Success of Homestay Agro Tourism It was found that this element was moderate satisfied variable with the mean of 3.73. Majority of the respondents agree with the success of homestay agro tourism organization is a factor in organization success. It was indicated that the respondents were of the opinion that the success were really supportive in enhancing of company’s profit. However, there are few respondents answered the question with strongly disagree and disagree because for them success is not an issue.
Figure 4.6: Success of Homestay Agro Tourism 69
4.5 Correlation Analysis Pearson Product Moment Correlation is used to determine the level of correlation between independent variable and dependent variable. Table 4.11 shows the scale that describes the strength of relationship between independent variable and dependent variable. In this analysis, hypotheses are tested to distinguish the significant relationship between two variables. Table 4.11: Pearson’s Correlation Scale Pearson r
Indication
Between (-)(+) 0.80 to (-)(+) 1.00
High correlation
Between (-)(+) 0.60 to (-)(+) 0.79
Moderate High correlation
Between (-)(+) 0.40 to (-)(+) 0.59
Moderately correlation
Between (-)(+) 0.20 to (-)(+) 0.39
Low correlation
Between (-)(+) 0.01 to (-)(+) 0.19
Negligible correlation
Correlation coefficient (r) is computed to investigating the strength of association among the variable. The level of significance is set at .05 or less.
4.5.1 Hypotheses Testing Hypothesis is a statement that the researcher sets out whether to accept or reject based on data collection method. Below are the hypotheses that were used in the analysis. This study used correlation analysis method to test the entire hypothesis. Pearson Correlation Method had been selected to be used since it is suitable because there are two variables in an interval scale. This section summarized the results of hypotheses testing that being determined in this research. It is reviewed and shown in Table 4.12 below.
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Table 4.12:
Correlation between Independent variables, Moderator variable and Dependent variable Tangibles Reliability Responsiveness Assurance Empathy Satisfaction .726**
.647**
.454**
.679**
.868**
.709**
Sig. (2-tailed)
.000
.000
.000
.000
.000
.000
N
200
200
200
200
200
200
SUCESS Pearson Correlation
4.5.1.1 Hypothesis one H1: Tangible has a significant positive relationship on the customer satisfaction Refer to table 4.12; the hypothesis has significant relationship between tangibles and overall satisfaction as significant level of 0.00 which is less than p value of 0.05. Thus hypothesis one is accepted. It can be concluded that tangibles is positively related to overall satisfaction. However, there is moderate high correlation between both variable as Pearson Correlation score is 0.726 in which tangibles influence to overall satisfaction by 72.6%.
4.5.1.2 Hypothesis Two The second hypothesis is intent to see the relationship between reliability and overall satisfaction. Below is the hypothesis statement:-
H2: Reliability has a significant positive relationship on the customer satisfaction.
Table 4.12 above shows the results of Pearson Correlation test that has been conducted between dimensions of reliability and overall satisfaction. The results revealed that there is an existence of significant value between these two dimensions as the p value is smaller than significant value (p = 0.000 which < 0.05). In addition, there is moderate high correlation between these two dimensions as correlation coefficient is at (r=0.647). It can be concluded as reliability value is positive relationship towards overall satisfaction. 71
Therefore, H2 is accepted. This indicates that reliability influence overall satisfaction by 64.7%.
4.5.1.3 Hypothesis Three The third hypothesis is intended to evaluate the relationship with responsiveness and overall perception. The hypothesis as below:H3:
Responsiveness has a significant positive relationship on the customer’s satisfaction.
Table 4.12 above shows the results of Pearson Correlation test that has been conducted between dimensions of responsiveness and overall satisfaction. The results revealed that there is positive relationship between two dimensions as the p value is less than significant value, (p=0.000 which is 5
Multicollinearity is substantial
VIF >10
Multicollinearity is serious
Table 4.16 indicates that the Variance Inflation Factor (VIF) is a scale in measuring of inverse of tolerance in which the sequence transformation when R2 value is large the VIF value also large. VIF also is use in identifying of predictor problems in multicollinearity. Thus, VIF indicates whether the regression is reliable or unreliable. The VIF result shows in table 4.16 as below: o Tangible VIF value is 2.141 which is less than 5 and there is no problem in multicollinearity. o Reliability VIF value is 2.221 which is less than 5 and there is no problem in multicollinearity. o Responsiveness VIF value is 1.320 which is less than 5 and there is no problem in multicollinearity. o Assurance VIF value is 2.104 which is less than 5 and there is no problem in multicollinearity. o Empathy VIF value is 2.253 which is less than 5 and there is no problem in multicollinearity. o Overall satisfaction VIF value is 2.567 which is less than 5 and there is no problem in multicollinearity. 78
4.7 Chapter Summary The six (6) hypothesis proposed earlier have been tested. Using a sample of 200 respondents, data was obtained from random respondents. The main objective was to examine the strength of overall satisfaction predictor’s such as tangibles, reliability, responsiveness, assurance and empathy towards homestay agro tourism service provider success. This chapter presented the results of the data analysis testing for this research. First, the descriptive statistics on the demographics respondent’s profiles were presented. Then, techniques of analysis to test the accuracy of data in terms of factor analysis, hypothesis testing and the impacts of independent variables on dependent variable were investigated by using multiple regression analysis in order to draw conclusions about the validity of the hypotheses. Next chapter will present the conclusions and implications of this research. Table 4.17: Summary of the Hypotheses Testing Hypotheses 1 H1: Tangible has a significant positive relationship on the customer satisfaction 2 H2: Reliability has a significant positive relationship on the customer satisfaction. 3 H3: Responsiveness has a significant positive relationship on the customer’s satisfaction. 4 H4: Assurance has a significant positive relationship on the customer satisfaction. 5 H5: Empathy has a significant positive relationship on the customer satisfaction. 6 H6: Customer satisfaction has a significant positive relationship on the success of homestay agro tourism.
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Direction of the relationship Positive
Significant P-value
Results
.000
Accepted
Positive
.000
Accepted
Positive
.000
Accepted
Positive
.000
Accepted
Positive
.000
Accepted
Positive
.000
Accepted
CHAPTER 5 DISCUSSION AND CONCLUSION
5.0 Introduction This chapter will discuss and summarize the finding on entire of the research. The findings and analysis of this study, which were presented in the previous chapter, are discussed in this chapter in terms of grasping its meaningful interpretation. The analyzed data are emphasized and explained comprehensively and conclusions were drawn for the evaluation purposes of this research. In this chapter discusses major findings based on three (3) objectives of the research that has been outlined in chapter one and suggestions were discussed in attempts to provide alternatives of improving the homestay agro tourism service provider in Malaysia. Developing and producing systems that could expand and give impact in homestay agro tourism industry services are mostly needed as customers nowadays are very particular, very selective and very smart in selecting of service availability that can give more advantage and benefit to them. Therefore, homestay agro tourism service provider can provide convenience for the customers and great hassle free environment will be the top preferences for them. . Thus this paper draws a conclusion and finally put forward few suggestion both the management as well as future researches. The conclusion describes the most important variables that have been applied to the Service Quality Model. Finally some recommendations are presented.
5.1 Summary of Findings Using the implications in the construction of a theoretical and analytical framework, the researcher attempted to investigate of factor that contributes to the success of homestay agro tourism, to examine the relationship amongst factors concerning customer satisfaction on homestay agro tourism and to explore the level of customer’s satisfaction towards homestay agro tourism in Malaysia. The results showed that it is reliable to use the five dimensions of the Service Quality Model as an instrument to predict the customer service quality to the customers. Since all the Cronbach’s alpha coefficients for 80
the study are between the ranges of 0.665 to 0.901, therefore, the method of predicting the intention to purchase by using five dimensions of the Service Quality model is acceptable (Waltz, Strickland & Lenz, 1991). Below is the discussion on demographic factors:5.1.1 Respondents’ demography
Figure 5.1: Gender, Age, Races and Religion of respondents
Socio-demographic variables that denote positive association with the customer’s intention to purchase include the gender, age, race, religion, education, employment, income and nationality. This study shows that there are 96 female (consist of 48%) and 104 male (consist of 52%) respondents were involved. Most of the respondents are from age between 26 – 30 years old consist for 78 respondents (39%), second follow by age of 31-40 for 63 respondents (31.5%), 25 or younger having 43 respondents (21.5) and age of 41 to 50 has 16 respondents (5.8%). Race group majority is Malay has 118 respondents (59%), Chinese are 34 respondents (17%), Indian has 38 respondents (19%) and other is 10 respondents (5%). For religion group Islam scored for the highest which 81
is 132 respondents (66%), Buddha for 20 respondents (10%), Christian for 31 respondents (15.5%) and Hindus for 17 respondents (8.5%).
Figure 5.2: Education, Employment, Income level and Nationality of respondents
Education group, other score for 125 respondents (62.5%), Diploma holder for 44 respondents (22%), Bachelor degree has 17 respondents (8.5%), Master degree consist of 13 respondents (6.5%) and PhD holder for 1 respondent (0.5%). Majority of the respondents are fulltime employed by 116 respondents (58%), part time employed for 64 respondents (32%) and self employed by 20 respondents (10%). Yearly income level of respondents for income below than RM20,000 has 16 respondents (8%), RM20,001 to RM30,000 consist for 25 respondent (12.5%), RM30,001 to RM40,000 for 78 respondents (39%), RM40,001 to 50,000 for 47 respondents (23.5%), RM50,001 to RM60,000 for 26 respondent (13%) and above RM60,000 for 8 respondents (4%). Nationality of respondent section, majority of respondents is Malaysian for 142 respondents (71%) and non Malaysian for 58 respondents (29%). 82
The findings for gender group in t-test indicates that there is significant difference in overall satisfaction between two sector (t value = 41.789, P = 0.000). As the probability error is less than 0.05 (p=0.000 < 0.05). Two genders within male and female, both of them has significant relationship. In other word, increase perception on gender will influence positively to overall satisfaction. This research revealed that both gender between male and female does different in overall satisfaction of homestay agro tourism services. However, research evidence suggests that the magnitude of the gender difference varies according to the type of behaviour that is evaluated (Fitzgerald et al., 1988). Therefore, an overall effect size computed across a broad range of behaviours may conceal unimportant on gender differences in overall satisfaction of homestay agro tourism industry. Age of respondents does not have an influence on intentional behaviour, since the F value is significant at the level of 0.669. The one way ANOVA table indicates that there is no significant difference in overall satisfaction of the respondent (F=0.669, p= 0.839). The walking distance between all places in homestay agro tourism has limitation to the ageing people to do some activities. Experiences and perceptions of ageing are of substantial importance for middle-aged and older people as they relate to health (Levy and Myers, 2005) and behavioural outcomes (Steverink, Westerhof, bode and Dittmann, 2001) along with well-being (Steverink et al., 2001) self and identity (Sneed and Whitbourne, 2005). Perceptions of ageing among middle-aged and older people refer to the ways they conceive the ageing process and, by extension, experience their own transition to old age. The formation of each individual’s perceptions and experiences of ageing is a dynamic process that pertains to self, social norms and their interplay (Steverink et al., 2001) and reflects the way an individual internalises social norms (Levy and Myers, 2005). Based on the results, race of respondents does not have any influence on overall satisfaction, since the F value is significant at the level of 1.493. The one way ANOVA table indicates that there is no significant difference in overall satisfaction of the respondent (F=1.493, p= 0.097). In order to explain race based relationship may relate to trust decision. This is consistent with Stanley et al. (2011) who stated that to explore how race based reputations may alter the neural systems of trust decisions, brain imaging 83
participants made a series of single shot trust game decisions with actual monetary consequences and real trustee partners whose primary distinguish feature was their race. Trust in a business relationship helps reduce business risks (Anderson and Norrus, 1990). A number of researchers suggest that the construct of trust is an important element in a business environment (Anderson and Norrus, 1990). Matzler et al., (2006) also have pointed out that trust means someone regards his or her transactional partners as reliable and honest and has confidence in them. Thus the race factors did not influence of overall satisfaction as the customer did not put trust to their overall satisfaction that lead to not significant influence to visit homestay agro tourism. From the ANOVA test for religion group scored at (p=0.626 which is > 0.05) is not significant. The finding of religion group indicates that the F value is 0.861 and p value of 0.626 which is more than significant value of p less than 0.05, thus there is no significant relationship between religion and overall satisfaction. This result was consistent with Norbaya Ahmad et al. (2007) indentifies in the study that Muslims, Buddhists and Hindus are making themselves comfortable and familiar to new form of services and making social interaction consisting of people from different cultures and belief system. Furthermore, Duraseh (2008) states in his study among Muslim community in Kelantan and Terengganu has found that the level of respondent acceptance in incantation was relatively moderate. From the above findings, it is indicated that the community was in the beginning to accept homestay agro tourism and eventually becomes popular. ANOVA for education group the result P = 0.008 is significant, employment group shown result of (p=0.107 which is > 0.05) which is not significant. Income group in one way ANOVA shows that significant level at p = 0.720. Since the p value is more than 0.05, this can be concluded that there is no significant difference in overall satisfaction based on their income level (F = 0.782, P = 0.720). Incomes have an influence on overall satisfaction. Recently, a number of studies have examined the relation between income level and generalized intention. Based from results in ANOVA, most of respondents are income RM30, 001 to RM40, 000 yearly of 78 of respondents (39%). This result consistent with most of the studies found that at least on the national level- where income level is high, generalized intention is low (Leigh, 2006). In other word, since the results had 39% respondent income between intermediate and low, there are significant
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relationship between income level and overall satisfaction to perform intention to visit homestay agro tourism. This study explored the overall satisfaction of customers regarding the satisfaction level of services and products received, so as to identify the areas for possible interventions to help improve the customer’s overall satisfaction towards the homestay agro tourism service delivery in the district. Understanding the determinants of customer satisfaction will assist the policy and decision-makers to plan and implement programs that fulfil the needs of customers as perceived by the customers of homestay agro tourism. Most of the indicators of overall satisfaction were used are scored positively by a high proportion of respondents. Generally, the respondents in the study decided that the tangibles, reliability, responsiveness, assurance and empathy towards homestay agro tourism are very good. The analysis of the customer’s overall satisfaction showed that there is a general acceptance as recognized by the literature. This study aimed to explore the level of customer’s satisfaction towards the intention to purchase provided by homestay agro tourism. The Service Quality Theory was used to design the questionnaire using five dimensions of SERVQUAL.
5.2 Discussion The result reveals that all five (5) hypotheses have significant relationship and all hypotheses were having positive relationship due to overall satisfaction of customer’s in homestay agro tourism industry was relatively high. 5.2.1 Tangible Based on the hypotheses, the purpose of study is to examine the relationship between tangible toward overall satisfaction. Therefore, researcher had structured hypothesis one that predict the attitude will significant influence overall satisfaction among customers. Among five independent variables H1 scored regression value r = 0.726. Whereas p value stand for H1 at p = 0.000. It also shows positive relationship, which mean and 85
tangible is correlate significantly with overall satisfaction and vice versa. Tangible refers to as the stimulus that stimulates the overall satisfaction of agro tourism. This finding was supported by Lada et al., (2010). They found that tangible is good predictors of satisfaction among consumers. In addition from the statistical report it can be interpreted that an increasing of tangible significantly increasing consumer’s satisfaction and experience which lead to re-purchase the services of agro tourism. This can be conclude that people who have positive mind set of agro tourism will create customer value and intent to re-purchase. This result was consistent with previous study by Sirdeshmukh et. al. (2002) found that tangible creates customer value that had a direct relationship with customer’s loyalty. In their study of assessing the effects of quality, value and customer satisfaction on consumer behavioural intentions in service environments, both direct and indirect effects of service value on behavioural intentions. Study shows that accessibility can influence people in making attitude for building confident in making of satisfaction. According to Christian Walt (2006), business have to become open and more accessible for better meeting customers’ needs and achieving greater customer satisfaction as well as creating positive attitude towards their products. Finding efficiency of business location is basically an accessibility solving problem. Imagine if homestay agro tourism centre is made as such a way an easy connection to public transportation and ease to find the location that will provide effective access to a significant proportion, it will make developments of agro tourism more liveable and sustainable in the future. This implies with the respond made by respondents in survey that agreed in the positive behaviour towards homestay agro tourism and increase intention to purchase behaviour.
5.2.6 Reliability This independent variables have scored regression value r = 0.647. Whereas p value stand for p = 0.000. It also shows positive relationship, which mean and reliability increasing, customer perception on reliability will correlate with customer satisfaction and vice versa. Most respondents believe the reliability influence toward overall 86
satisfaction is higher when they believe that services being offered by homestay agro tourism are reliable. In addition, from the statistical report, it can be interpreted that an increasing of customer’s perception on reliability will increase customer’s satisfaction and experience which lead to customer recommendation to other customers to consider and purchase of such services. This can be concludes that home stay agro tourism service provider successfully delivered promises to its customer and at the same time customers who have positive mind set on data service centre will create customer value and intent to recommend to others. This result was consistent with previous study (Sideshmukh et al. 2002) who found that customers maintain positive attitude creates customer’s value that had a direct relationship with customer’s satisfaction in which relate to customer’s loyalty. In their study of assessing the effects of service quality, value and customer satisfaction in service environments, both direct and indirect effects of service value on behavioural intentions. Study show that reliability can influence people in building confident in making of satisfaction. Sarina Ismail (2009) mentioned that service provider have to become more reliability for better meeting customer’s needs and achieving greater satisfaction. Finding efficiency of homestay agro tourism is basically a reliability problem and reliability is directed to customer’s satisfaction. The simplest form of reliability when customers have experience the services in homestay agro tourism and founded that it is easy in reliability services will lead to assumption in satisfaction behaviour. It is a simplest form; however, a relationship between reliability and customer satisfaction is characterized as positive commitment by both homestay agro tourism provider and customers. If services are made in such a way that it is customer friendly and reliability of service to customer that will provide effective access to a significant proportion, it will make developments of home stay agro tourism provider more likeable and sustainable in the future. This implies with the respond was made by respondents in survey that agreed in the positive attitude towards homestay agro tourism accessibility of reliability and customer satisfaction. Kraft and Lee (1979) stated in their study that information sources influence customers satisfaction and will directly affect on belief of respondents. This also will make people influence others who are close to them to perform and make behavioural decision in purchasing of homestay agro tourism.
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5.2.3 Responsiveness Above hypothesis was developed is to assess the relationship of responsiveness towards customer satisfaction. The findings indicate that there is significant differences in responsiveness towards customer satisfaction in which the value at (p=0.000 which is
