Customization of the online purchase process in electronic retailing and customer satisfaction: An online field study

• DOI: http://doi.org/10.1016/j.jom.2010.11.009
• Author: Kingshuk K. Sinha,Sriram Thirumalai
• Published date: 01 July 2011
• Date: 01 July 2011

Journal of Operations Management 29 (2011) 477–487

Contents lists available at ScienceDirect

Journal of Operations Management

journal homepage: www.elsevier.com/locate/jom

Customization of the online purchase process in electronic retailing and

customer satisfaction: An online field study

Sriram Thirumalaia,∗, Kingshuk K. Sinha b,1

aOperations and Information Systems, David Eccles School of Business, 1645 E., Campus Center Dr., University of Utah, Salt Lake City 84112, United States

bOperations and Management Science, Carlson School of Management, University of Minnesota, Minneapolis 55455, United States

article info

Article history:

Available online 25 November 2010

Keywords:

Customization

Online purchase process

Customer satisfaction

Online field study

Electronic retailing

abstract

This paper investigates the customization of the online purchase process in electronic retailing. We con-

ceptualize customization relevant to the two constituent sub-processes in the online purchase process:

(i) decision customization—the customization of the information content delivered to customers to help

them in the decision-making sub-process; and (ii) transaction customization—the customization of the

purchase transaction sub-process for each customer. We draw on and synthesize the theoretical per-

spectives of Website Usability, Technology Acceptance Model, and Transaction Costs, to triangulate and

deduce hypotheses linking customization of the online purchase process in electronic retailing and cus-

tomer satisfaction. The hypotheses are tested by analyzing: (i) primary data on customization of the

online purchase process collected from an online field study involving a direct observation and con-

tent analysis of the websites of 422 retailers; and (ii) secondary data on customer satisfaction with the

online purchase process for the same set of 422 electronic retailers collected from a publicly available

data source. The research method used for the empirical analysis is Multivariate Analyses of Covariance

(MANCOVA). The results indicate that decision customization that provides choice assistance by way

of personalized product recommendations is positively associated with customer satisfaction with the

decision-making sub-process; and transaction customization, oriented towards making the transaction

sub-process personal, convenient, and interactive is positively associated with customer satisfaction with

the purchase transaction sub-process. Additionally, the results indicate that both decision customization

and transaction customization are associated with overall customer satisfaction with the online purchase

process of electronic retailers. The contributions, managerial implications, and limitations of the study,

and directions for future research are discussed.

© 2010 Elsevier B.V. All rights reserved.

1. Introduction

Electronic retailing, which includes online interactions between

a retailer and a customer from the point the customer arrives at

the retailer’s website to the point the retailer fulfills the customer’s

order, has quickly emerged to become an important class of ser-

vice operations (Field et al., 2004; Smith et al., 2007). Sales volume

in electronic retailing is growing steadily—e.g., in the third quarter

of 2009, electronic retailing sales in the U.S. totaled approximately

$34 billion, a 4.5(±1.2)% increase from the previous quarter. Retail-

ers participating in this service sector, i.e., electronic retailers, offer

service-products that include not only a product (e.g., a book),

but also the process that facilitates the purchase of the product

∗Corresponding author. Tel.: +1 801 585 3940; fax: +1 801 581 7731.

E-mail addresses: sriram.thirumalai@business.utah.edu (S. Thirumalai),

ksinha@umn.edu (K.K. Sinha).

1Tel.: +1 612 624 7058; fax: +1 612 624 8804.

online (Heim and Sinha, 2001a). And customers’ perceived quality

of an electronic retailer’s service product is reflective of not only

the product quality, but also the quality of the online purchase

process—i.e., e-service quality, defined as the extent to which a

retailer facilitates efficient and effective shopping, purchase, and

delivery of products (Zeithaml, 2000). The quality of the online

purchase process has been found to affect customers’ purchase

decisions, satisfaction, and loyalty in electronic retailing (Zeithaml

et al., 2002; Wolfinbarger and Gilly, 2003). Hence, to be competi-

tive, electronic retailers need to not only offer a superior product,

but also provide “a better purchasing experience, greater consumer

control, and better personalization options” (Iqbal et al., 2003,p.

51), and ensure that the online purchase process is responsive and

convenient for customers.

Toward this end, electronic retailers are increasingly pursu-

ing customization enabled by personalization technologies, which

makes it possible to tailor the online purchase process to the indi-

vidual needs of a customer. From the standpoint of retailers, the

premise of such customization is that by being able to sense and

0272-6963/$ – see front matter © 2010 Elsevier B.V. All rights reserved.

doi:10.1016/j.jom.2010.11.009