A study of consumer satisfaction and the relationship with its determinants across industries


Student thesis: Master's Thesis

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  • Miu Hung CHAN

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Awarding Institution
Award date3 Oct 2006


It is widely accepted that consumer satisfaction is a critical indicator of business performance. Numerous research studies show that consumer satisfaction is highly correlated with a company’s profitability. Thus, it is an important question to investigate the formation process of consumer satisfaction and understand how consumer satisfaction is affected by different factors. Findings to this question would provide valuable insight to organizations to map out appropriate marketing strategies in order to enhance consumer satisfaction. However, most of these studies were carried out in western countries while relatively little research was conducted based on data collected in Asian markets. In this study, our attempt is to provide some clues to these issues using the data collected from customer surveys conducted in Hong Kong. There are three main parts in this dissertation. Firstly, patterns of consumer satisfaction in Hong Kong are explored. In the literature, there are discussions on the difference of underlying patterns in consumer satisfaction between products and services. The difference is due to the special nature of service including intangibility, customer participation, simultaneity, perishability and heterogeneity. Based on empirical evidence in some marketing studies, it is believed that the amount of information and knowledge possessed by consumer on a product or service item would affect the formation process of consumer satisfaction. Motivated by this idea, products are further categorized into durables and non-durables while services are classified into well-developed and newly-developed according to the amount of knowledge consumers hold. Comparison is made between durables and non-durables; as well as between well-developed industries and newly-developed industries so that we can understand how the amount of information and knowledge consumers have affects the evaluation process of consumer satisfaction. In order to gain further insight, the disparity among various industries motivates further study on how consumer satisfaction is affected by its determinants. Consumers form their satisfaction based on different yardsticks such as expectation, value and performance. Firms must understand the determinants that drive the differences on satisfaction so that they can make their customers become more satisfied and improve the profitability of the company. In the second part of the dissertation, the direct relationships between satisfaction and its determinants – expectations, assessed performance and assessed value are investigated for various industries. There have been diverse views in the literature on the importance of reliability and customization on products and services. Some researchers argued that reliability is more important for service industries due to the special features of service. However, some argued that companies can make use of the nature of customization in services to meet customers’ needs better; thus, customization is more critical to service industries. Hence, there is a debate on whether lower reliability leads to lower satisfaction or higher customization drives to higher satisfaction in services. In the third part of the dissertation, the objective is to explore the relations between consumer satisfaction and the indicators – reliability and customization for products and services. This research attempts to draw insight of the patterns of consumer satisfaction in various industries based on the consumer survey conducted in Hong Kong in the past few years. Consumer satisfaction and its relationship with different determinants among various industries are explored as an attempt to better understand the behavior patterns of consumers in forming their satisfaction towards different industries. In particular, we investigate the moderating role of information and knowledge in the formation process of consumer satisfaction. Findings from this study would help identify factors which contribute to the difference and develop valuable insight so that firms can adopt the appropriate marketing strategies to enhance consumer satisfaction.

    Research areas

  • Consumer satisfaction