CHAPTER observing unique elements at each stage (Oliver,

CHAPTER 2 LITERATURE REVIEW2.0 IntroductionThis section will discuss the relationships among the dependent variable, customer satisfaction with the independent variables, price of product, quality of product and service value.2.1 Customer SatisfactionAccording to Chatura Ranaweera, Jaideep Prabhu, (2003) customers’ satisfaction on their purchase is a significant factor that leads business to success. In recent times, customer satisfaction has gained new attention within the context of the paradigm shift from transactional marketing to relationship marketing. Customers who are satisfied with a purchased product will buy the same product again, more often (Reichheld 1996), and will also recommend it to others (Oliver and Swan 1989).The definition of customer satisfaction can be divided into two which is driven to outcome and driven to process (Lee, 1995). Customer satisfaction is conceptualized as the result of consumption experience such as the recognition felt by customer that the price paid is rewarded in proper or improper manner, emotional reaction against the retail shop or purchasing behavior related with purchased specific product or service, or emotional reaction against the behavior in wider meaning such as consumer’s behavior or the market on the whole, comprehensive mental state that occurs when the emotion due to inconsistent expectation is combined with the emotion prior to the customer’s experience of purchase.The aspect driven to process is useful in that it generalizes the whole consumption experience, and it enables to examine an important process that reaches customer satisfaction through the measure of observing unique elements at each stage (Oliver, 1981).Customer satisfaction is important in order to retain customers, and customer retention has been shown to have a significant effect on profitability (Reichheld and Sasser, 1990) hence, the importance of creating and retaining satisfied customers.


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