FACTORS THAT INFLUENCE CUSTOMERS PERCEPTION ON RETAIL STORE IMAGE

NORLAILI BINTI MASRAN 2008280524 BACHELOR OF BUSINESS ADMINISTRATION WITH HONOURS (RETAIL MANAGEMENT) BBA (HONS) RETAIL MANAGEMENT FACULTY OF BUSINESS MANAGEMENT UNIVERSITI TEKNOLOGI MARA SHAH ALAM

MAY 2010

FACTORS THAT INFLUENCE CUSTOMERS PERCEPTION ON RETAIL STORE IMAGE NORLAILI BINTI MASRAN This thesis is submitted as a partial fulfillment for the Bachelor of Business Administration (HONS) Retail Management, Faculty of Business Management Universiti Teknologi MARA BACHELOR OF BUSINESS ADMINISTRATION WITH HONOURS (RETAIL MANAGEMENT) BBA (HONS) RETAIL MANAGEMENT FACULTY OF BUSINESS MANAGEMENT UNIVERSITI TEKNOLOGI MARA SHAH ALAM MAY 2010

DECLARATION OF ORIGINAL WORK

BACHELOR OF BUSINESS ADMINISTRATION WITH HONOURS (RETAIL MANAGEMENT) BBA (HONS) RETAIL MANAGEMENT FACULTY OF BUSINESS MANAGEMENT UNIVERSITI TEKNOLOGI MARA SHAH ALAM

DECLARATION OF ORIGINAL WORK

I, NORLAILI BINTI MASRAN, (I/C Number: 870817-43-5770) Hereby, declare that: This work has not previously been accepted in substance for any degree, locally or overseas, and is not being concurrently submitted for this degree or any other degrees. This project paper is the result of my independent work and investigation, except where otherwise stated. All verbatim extract have been distinguish by quotation marks and sources of my information have been specifically acknowledgement

Signature: _________________

Date: MAY 5, 2010

LETTER OF TRANSMITTAL MAY 5, 2010

DR. AMILY FIKRI The Head of Program Bachelor of Business Administration with Honours (Retail Management) Faculty of Business Management Universiti Teknologi Mara 40450 Shah Alam Selangor Darul Ehsan.

Dear Sir/Madam, SUBMISSION OF PROJECT PAPER (RET 662) Attached is the project paper titled FACTORS THAT INFLUENCE CUSTOMERS PERCEPTION ON RETAIL STORE IMAGE This study is conducted in order to fulfill the requirement needed by the faculty of Business Management Universiti Teknologi MARA.

Thank You.

Yours sincerely,

________________

NORLAILI BINTI MASRAN 2008280524 BACHELOR OF BUSINESS ADMINISTRATION WITH HONOURS (RETAIL MANAGEMENT)

ACKNOWLEDGEMENT Alhamdulillah, my greatest regard to ALLAH s.w.t for giving me a good health, and strength in completing this report. My appreciations to all the people, in groups or individually, that had their contribution directly or indirectly to me throughout the period of my practical training and preparation of this report. I wish to acknowledge the support of the following people as without their help this research would not be possible. I would like to express my most gratitude to my advisor Dr. Anizah Zainuddin who had supervised and assisted me throughout this study. She has kindly devoted her time to read, criticize and giving opinion on this study paper. Through her willingness to give advice, motivate, and direction, a special debt of gratitude is expressed to her. All her guidance enables me to complete and submit this report within the time prescribed. May Allah bless her for all her kindness. I would also like to express my appreciation and thanks to my second examiner who had contributed indirectly towards the completion of this study and analyzing my work that is Dr. Noraini Mohamad Shariff. Lastly, I want to express this acknowledgement to my special appreciation to my beloved family for their enduring patience and support. I also want to dedicate my greatest thank to my friends, colleagues and others who are directly and indirectly in contributing and comments for this research paper.

Thank You.

TABLE OF CONTENTS CONTENT TITLE PAGE DECLARATION OF WORK LETTER OF TRANSMITTAL ACKNOWLEDGEMENT LIST OF TABLES v LIST OF FIGURES ABSTRACT CHAPTER 1 - INTRODUCTION 1.0 1.1 INTRODUCTION BACKGROUND OF THE STUDY 1.1.1 History 1.1.2 Types of Retail Store 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 1.10 PROBLEM STATEMENT RESEARCH OBJECTIVES RESEARCH QUESTIONS HYPOTHESES THEORETICAL FRAMEWORK SIGNIFICANCE OF THE STUDY SCOPE OF THE STUDY DEFINITION OF TERMS LIMITATION OF STUDY 1 3 3 6 10 11 11 12 13 14 15 15 17 vi vii PAGE i ii iii iv

CHAPTER 2 - LITERATURE REVIEW 2.0 INTRODUCTION 18

2.1 19 2.3 2.4 2.5

RETAIL STORE IMAGE 2.2 BRAND IMAGE

18

SOCIAL CUES (CUSTOMER SERVICE) STORE ATMOSPHERE PRICE

21 22 24

CHAPTER 3 - RESEARCH METHODOLOGY 3.0 3.1 3.2 INTRODUCTION RESEARCH DESIGN SAMPLING DESIGN 3.2.1 Population 3.2.2 Sample 3.2.3 Sampling Methods 3.2.4 Sample Size 3.3 28 3.3.1 Primary Data 3.3.2 Secondary Data 3.4 3.5 QUESTIONNAIRE DATA PROCESSING 28 29 29 30 DATA COLLECTION METHOD 26 26 27 27 27 27 28

CHAPTER 4 - FINDINGS AND ANALYSIS 4.0 4.1 INTRODUCTION RELIABILITY ANALYSIS 4.1.1 Brand Image Factor 4.1.2 Social Cues Factor 4.1.3 Store Atmosphere 4.1.4 Price Factor 4.2 FREQUENCY DISTRIBUTION 4.2.1 Respondents Gender 32 32 32 33 34 34 36 36

4.2.2 Respondents Age 4.2.3 Respondents Status 4.2.4 Respondents Occupation

37 38 39

4.3

DESCRIPTIVE ANALYSIS 4.3.1 Brand Image Factor 4.3.2 Social Cues Factor 4.3.3 Store Atmosphere Factor 4.3.4 Price Factor

40 40 41 42

43 4.3.5 Retail Store Image 4.4 CORRELATION ANALYSIS 4.4.1 Hypothesis 1 4.4.2 Hypothesis 2 4.4.3 Hypothesis 3 4.4.4 Hypothesis 4 4.5 REGRESSION ANALYSIS 44 45 45 46 47 48 50

CHAPTER 5 - CONCLUSIONS AND RECOMMENDATIONS 5.0 5.1 5.2 INTRODUCTION CONCLUSIONS RECOMMENDATIONS 52 52 54

BIBLIOGRAPHIES APPENDICES

LIST OF TABLES Table 4.1: Reliability for Brand Image Factor Table 4.2: Reliability for Social Cues Factor Table 4.3: Reliability for Store Atmosphere Factor Table 4.4: Reliability for Price Factor Table 4.5: Reliability for Retail Store Image Table 4.6: Respondents Gender Table 4.7: Respondents Age Table 4.8: Respondents Status Table 4.9: Respondents Occupation Table 4.10: Descriptive Statistic for Brand Image Factor Table 4.11: Descriptive Statistic for Social Cues Factor Table 4.12: Descriptive Statistic for Store Atmosphere Factor Table 4.13: Descriptive Statistic for Price Factor Table 4.14: Descriptive Statistic for Retail Store Image Table 4.15: Correlation between Brand Image Vs Retail Store Image Table 4.16: Correlation between Social Cues Vs Retail Store Image Table 4.18: Correlation between Price Vs Retail Store Image Table 4.19: Model Summary Table 4.20: CoefficientsA

PAGE 31 32 33 33 34 35 36 37 38 39 40 41 42 43 44 45 47 48 48

Table 4.17: Correlation between Store Atmosphere Vs Retail Store Image 46

LIST OF FIGURES Figure 1.1: Elements of Retail Store Image Figure 1.2: Theoretical Framework Figure 3.1: Data Processing Figure 4.1: Percentage of Respondents Gender Figure 4.2: Respondents Age Figure 4.3: Respondents Status Figure 4.4: Respondents Occupation

PAGE 2 13 30 35 36 37 38

ABSTRACT

This research was conducted to study the factors that influence customers perception towards retail store image. The objective of this research is to determine the extent influence between the factors and customers perception towards retail store image. This study also was conducted to know the most factor that influence customers perception on retail store image. Besides that, to analyze relationship between independent variables (brand image, customer service, store atmosphere and price) and dependent variable is also objective of this study. Finally, the purpose of this study is to recommend about the effective way that can be done by retailers in improving their retail store image. The researcher had distributed the questionnaire among 250 respondents that come to the retail store. Brand image, customer service, store atmosphere and price are the independent variables that being selected by the researcher. The data from personally administered question was been analyze through Statistical Package for Social Science (SPSS) version 17. After collecting the data and analyze it, the result shows that there is association or relationship between these independent variables and the retail store image. The finding also shows that between independent variables and dependent variable have positive relationships. By conducting this research also, the researcher will suggest and recommend some suggestion and recommendation for the future. The researcher hopes that retailers can improve their retail store image level in

order to make sure that the customers have a good perception on retail store image and satisfied with the retail store.

CHAPTER 1 INTRODUCTION

CHAPTER 1
1.0 INTRODUCTION In retail industry, retailers need to concern about relationship with customers to get customers satisfaction and make them return to buy and continue for shopping at the outlet, therefore there have one more important thing that the retailers need to concern in their retail outlet which is what are the customers perception towards the retail outlet that they come and go for shopping. For the retail industry store image is also one of the factors that must be aware by each employer and employee to make the outlet always in good customers perception and make the customer become trust towards the retail outlets. Even they are doing their business that focusing on their products but they are also must focusing in the store image for the outlet. So they can increase in quality of their store and services and contributing to good customers perception and also lead to customers satisfaction towards the outlets. Retail store image means that physical characteristics and surrounding influence of retail store that is used to create an image in order to attract customers (http://retail.about.com/od/glossary/g/atmosphere.htm). Based on (Barry Berman and Joel R.Evans) said that image is refers to how a retailer is perceived by customers and others, while positioning refers how a firm devises its strategy so

as to project an image relative to its retail category and its competitors and to elicit a positive consumer response. To succeed, a retailer must communicate a distinctive, clear, and consistent image. Once its image is established in consumers minds, a retailer is placed in a niche relative to competitors. For global retailers, it can be challengers to convey a consistent image worldwide, given the different backgrounds of consumers.

FIRMS POSITIONIN G

TARGE T MARKE T

ATTRIBUTES OF PHYSICAL FACILITIES

SHOPPING EXPERIENCES

CUSTOME R SERVICE COMMUNITY SERVICE

STORE LOCATIO N

OVERALL RETAIL IMAGE

PRICIN G MERCHANDIS E ATTRIBUTE

PROMOTION TOOLS 1. ADVERTISIN G 2. PUBLIC RELATION 3. PERSONAL SELLING 4. SALES PROMOTION

FIGURE 1.1: THE ELEMENTS OF A RETAIL IMAGE

SOURCE: Barry Berman & Joel R.Evans, (2006). Retail management: a strategic approach (Pearson Education, Inc., Upper Saddle River, New Jessy, 07458)

1.1

BACKGROUND OF STUDY

1.1.1

HISTORY Retail industry is a sector of the economy that is comprised of individuals

and companies engaged in the selling of finished products to end users, not for resale, but for use and consumption by the purchaser. The retail transaction is at the end of the supply chain. Manufacturers sell large quantities of products to retailers, and retailers sell small quantities of those products to consumers. The emergence and tremendous growth of the new economy has unleashed powerful forces that are reshaping the retail industry at an

unprecedented rate. Everything from customer relationships to branding to supply chain management is impacted by this revolution. Given the dynamics at work in the new economy, retailers are struggling to strike a balance between maintaining operational excellence and implementing necessary changes. The current transformation of the retail industry is accelerating rapidly due to the formation of new businesses not encumbered by the limitations of traditional organizational and structural models. Electronic, or virtual, stores are an excellent example. These merchants can reinvent their value propositions within weeks, work outside traditional pricing and profit margins, and offer customers complete access to competitors prices and product information. This kind of competition completely changes how the industry does business, reducing a traditional retailers ability to influence purchasing behavior by presenting customers with less reason to visit a local store and upending the traditional value proposition offered to consumers.

Worlds Top Retailers Rank Country of Origin Name of Company Formats Retail Sales In 2001 (US$ MILLIONS) 217799 Countries of operation

US

Walmart

Discount, Hypermarket, Supermarket, Superstore,W arehouse

Argentina,Brazil,Can ada,China, Germany,Mexico, Puerto Rico, S.Korea,UK,US

France

Carrefour

Cash&Carry, Convenience, Discount, Hypermarket, Supermarket

61565

Netherlands

Royal Ahold

Cash&Carry, Discount, Drug, Convenience, Hypermarket, Specialty, Supermarket

57976

Argentina, Belgium,Brazil, Chile,China, Columbia,Czech Rep,France, Dominican Repub,Greece, Indonesia,Italy, Japan,Madagascar, Malaysia,Mauritius, Mexico,Morocco, Oman,Poland, Portugal,QatarRoma nia,Singapore, Slovakia,Spain, South Korea, Switzerland,Taiwan, Thailand,Turkey, UAE. Argentina,Brazil, Chile, Costa Rica,Czech Rep,Denmark, Equador, El Salvador,Estonia, Guatemala, Honduras, Indonesia,Latvia, Lithuania,Malaysia, Netherlands,Nicarag ua, Norway,Paraguay, Peru,Poland, Portugal,Slovakia, Spain,Sweden, Thailand,US

4 5

US US

Home Depot Kroger

DIY,Speciality Convenience, Discount, Speciality, Supermarket, Warehouse Cash&Carry, Department, DIY, Hypermarket, Specialty, Superstore

53553 50098

Canada,Mexico,Puert o Rico,US US

Germany

Metro AG

43357

7 8 9 10 11 12

US US US US UK US

Target Albertsons Kmart Sears Safeway Costco

Department, Discount Drug, Supermarket, Warehouse Discount, Superstore Department, Mail Order, Specialty Supermarket Warehouse

49355 37931 36151 35843 34301 34137

Austria, Belgium, Bulgaria, China, Croatia, Czech Rep, Denmark, France, Germany, Greece, Hungary, India, Italy, Japan, Luxembourg, Morocco, Netherlands, Poland, Portugal, Romania, Russia, Slovakia, Spain, Switzerland, Turkey, UK, Ukraine, Vietnam US US US Canada, Puerto Rico, US UK, US, Canada Canada, Japan, Mexico, PuertoRico, S.Korea, Taiwan, UK, US Czech Rep, Hungary, Malaysia, Poland, Rep.of.Ireland, Thailand, S.Korea, Slovakia Taiwan, Thailand, UK, US

13

UK

Tesco

Convenience, Department, Hypermarket, Supermarket, Superstore, Specialty

33614

Source: 2003 Global Retail Report, Deloitte Touche Tohma

1.1.2

TYPES OF RETAIL STORE

i.

CONVENIENCE STORE A convenience store is a small store or shop that sells items such as candy, ice-cream, soft drinks, cigarettes and other tobacco products, newspapers and magazines, along with a selection of processed food and perhaps some groceries. Stores that are part of gas stations may also sell motor oil, windshield washer fluid, radiator fluid, and maps. Often toiletries and other hygiene products are stocked, and some of these stores also offer money orders and wire transfer services or liquor products. They are often located alongside busy roads, in densely-populated urban neighborhoods, at gas/petrol stations or near railway stations or other transportation hubs. In some countries most convenience stores have longer shopping hours, some being open 24 hours.

ii.

DEPARTMENT STORE A department store is a retail establishment which specializes in satisfying a wide range of the consumer's personal and residential

durable goods product needs; and at the same time offering the consumer a choice multiple merchandise lines, at variable price points, in all product categories. Department stores usually sell products including apparel, furniture, home appliances,

electronics, and additionally select other lines of products such as paint, hardware, toiletries, cosmetics, photographic equipment, jewelery, toys, and sporting goods. Certain department stores are further classified as discount department stores. Discount department stores commonly have central customer checkout areas, generally in the front area of the store. Department stores are usually part of a retail chain of many stores situated around a country or several countries.

iii.

HYPERMARKET In commerce, a hypermarket is a superstore which combines a supermarket and a department store. The result is a very large retail facility which carries an enormous range of products under one roof, including full lines of groceries and general merchandise. In theory, hypermarkets allow customers to satisfy all their routine weekly shopping needs in one trip.

iv.

SUPERMARKET

A supermarket, also called a grocery store, is a self-service store offering a wide variety of food and household merchandise, organized into departments. It is larger in size and has a wider selection than a traditional grocery store and it is smaller than a hypermarket or superstore. The supermarket typically comprises meat, fresh produce, dairy, and baked goods departments along with shelf space reserved for canned and packaged goods as well as for various nonfood items such as household cleaners, pharmacy products, and pet supplies. Most supermarkets also sell a variety of other household products that are consumed regularly, such as alcohol (where permitted), household cleaning products, medicine, clothes, and some sell a much wider range of nonfood products. The traditional suburban supermarket occupies a large amount of floor space, usually on a single level, and is situated near a residential area in order to be convenient to consumers. Its basic appeal is the availability of a broad selection of goods under a single roof at relatively low prices. Other advantages include ease of parking and, frequently, the convenience of shopping hours that extend far into the evening or even 24 hours a day. Supermarkets usually make massive outlays of newspaper and other advertising and often present elaborate in-store displays of products. The stores often are part of a corporate chain that owns or controls (sometimes by franchise) other supermarkets located nearby even transnationally thus increasing opportunities for economies of scale. Supermarkets typically are supplied by the distribution centers of its parent company, such as Loblaw

Companies

in

Canada,

which

operates

thousands

of

supermarkets across the nation. Loblaw operates a distribution center in every province usually in the largest city in the province. Supermarkets usually offer products at low prices by reducing their economic margins. Certain products (typically staple foods such as bread, milk and sugar) are occasionally sold as loss leaders, that is, with negative profit margins. To maintain a profit, supermarkets attempt to make up for the lower margins by a higher overall volume of sales, and with the sale of highermargin items. Customers usually shop by placing their selected merchandise into shopping carts (trolleys) or baskets (self-service) and pay for the merchandise at the check-out. At present, many supermarket chains are attempting to further reduce labor costs by shifting to self-service check-out machines, where a single employee can oversee a group of four or five machines at once, assisting multiple customers at a time. A larger full-service supermarket combined with a department store is sometimes known as a hypermarket. Other services offered at some supermarkets may include those of banks, cafs, childcare centers/creches, photo processing, video rentals, pharmacies, and/or filling stations.

1.2

PROBLEM STATEMENT The concept of retail store image first came of interest when Pierre Martineau (1958) described the personality of the retail store. Retail store image is an overall impression of a store as perceived by consumers (Keaveney and Hunt, 1992). One of the commonly accepted formal definitions of retail store image is an individuals cognitions and emotions that are inferred from perceptions or memory inputs that are attached to a particular store and which

represent what that store signifies to an individual (Baker et al., 1994; Mazursky and Jacoby, 1986). Gaining competitive advantage in retailing requires knowledge of the attributes consumers use to evaluate stores and an understanding of why these attributes are important. Some retailers are only focus in their outlet, some retailers are focusing on their customer service and others factors that they think can make their store unknown and being the customers chosen. From this problem it is important for the researcher to make a study on this issue because the researcher want to know the retailers awareness about retail store image in the retail outlets and the factors that can influence customers perception towards the retail store image, therefore its can lead to the customers satisfaction and contributing intention to return towards the retail outlet. The purpose of retail store image management is to reduce the adverse effects of breakdown and to maximize the customers satisfaction by focusing in the factors that influence them to have good perceptions towards the retail store image in the retail outlets. So that, the researcher want to give some opinions and solutions for helping industries in retail store image problem and at the same time can improve performance and operations at retail outlets. 1.3 RESEARCH OBJECTIVES The objectives of this research are including: RO1 To determine the extent influence between brand image and retail store image RO2 To examine the extent influence between social-cues (customer services) and retail store image

RO3

To investigate the extent influence between store atmosphere and retail store image

RO4 RO5

To study the extent influence between price and on retail store image To find the factor that most influence customers perception on retail store image

1.4

RESEARCH QUESTIONS RQ1 Is there a significant relationship between brand image and retail store image in this research? RQ2 Is there a significant relationship between social-cues (customer services) and retail store image in this research? RQ3 Is there a significant relationship between store atmosphere and retail store image in this research? RQ4 Is there any significant relationship between price and retail store image in this research? RQ5 What is the most factor that influence customers perception on retail store image

1.5

HYPOTHESES HYPOTHESIS 1 The relationship between brand image and retail store image. H1: There is a relationship between brand image and retail store image. H0: There is no relationship between brand image and retail store image. HYPOTHESIS 2

 The relationship between customer service and retail store image. H1: There is a relationship between customer service and retail store image. H0: There is no relationship between customer service and retail store image. HYPOTHESIS 3 The relationship between store atmosphere and retail store image. H1: There is a relationship between store atmosphere and retail store image. H0: There is no relationship between store atmosphere and retail store image. HYPOTHESIS 4 The relationship between price and retail store image. H1: There is a relationship between price and retail store image. H0: There is no relationship between price and retail store image.

1.6

THEORETICAL FRAMEWORK As stated by Sekaran (2007), theoretical framework is logically developed, described and explained network of associates among variables of interest to the researcher. Dependant variable is the interest topic that researcher want to study and investigate. Meanwhile, independent variables are variables that influence or explained the dependent variable. This theoretical framework is

important in order to provide information on how the variables should be operationalized and measured as well as how the research design and sample should be selected. A theory also serves as a foundation on which the researcher can organize and interpret the findings. Figure 1.2 shows the theoretical framework that explained the relationship between dependent and independent variables of study.

Brand image

(Baker et al., 1994) Customer Service (Skoll, 1999) Store Atmosphere (Monroe and Lee 1999) Price (Bellizzi, Crowley, and Henderson 1983; Milliman 1982; Eroglu and Machleit 1990; Grewal et al. 2003).
INDEPENDENT VARIABLES DEPENDENT VARIABLE

Retail Store Image

1.7

SIGNIFICANCE OF STUDY 1.7.1 The Retail Industry Besides that, if we look the significant to the industry, this study will give some useful information and feedback as regards to the retail store image problem in Retail Industry. Retailers also will know how to improve their

retail store image in order to achieve good customers perception on retail store image that lead to the service quality achievement and customers loyalty towards the retail store. From this study, retailers can understand more about the important of retail store image to increase customers perceptions and trust towards the retail industry. 1.7.2 The Researcher It is a benefit to the researchers to this study because it will give an experience and knowledge on how to conduct a proper research. It also purposeful in preparation some guideline as to make it beneficial to the researchers in the future needs. This study is also significant to the researchers because it fulfill the requirement of practical training for Bachelor of Business Administration (Hons) Retail Management course. 1.7.3 University This study will be use for reference and information for students. Students and lecturers can have an extra knowledge on information provided by the researcher.

1.8

SCOPE OF STUDY The research is conducted to focus on the retail store image in retail industry. This research includes the awareness of the retail store image by retailers in the outlet and the factors that influence customers perception on retail store image. The scope of this study is capturing a subset of four (4) factors that influence

customers perception on retail store image. The independent variables of this research are consists of 4 elements or factors which is brand image, social-cues (customer service), price, and store atmosphere. The research is conducted in November 2009 to April 2009. For completion of this study, the researchers will use questionnaires that are distributed to the respondents at retail on order to get feedback and information needed to be analyzed and tested to achieve the research objective. 1.9 DEFINITION OF TERMS a) Retail store image Individuals cognitions and emotions that are inferred from perception of memory inputs that are attached to a particular store and which represent what that store signifies to an individual. b) Brand image The perception of your product or your brand by the consumer which usually include the products name, its main physical features, and appearance (including the packaging and logo), and its main function. c) Social-cues (customer service) The ability to provide service or product in the way that it has been promised. Retailers are treating others as you would like to be treated yourself. It is an organization's ability to supply their customers' wants and needs and the process of taking care of our customers in a positive manner. Other than that, customer service is any contact between a customer and a company that causes a negative or positive perception by a customer. They are providing competitive advantage and adding benefits in order to maximize the total value to the customer including providing value added services to external and internal customers, likes

attitude knowledge, technical support and quality of service in a timely manner, therefore focusing in proactive attitude that can be summed up as: I care and I can do." d) Price - The sum or amount of money at which a thing is valued, or the value which a seller sets on his goods in market; that for which something is bought or sold, or offered for sale; equivalent in money or other means of exchange; current value or rate paid or demanded in market or in barter; cost. e) Store atmosphere - The physical characteristics and surrounding influence of a retail store that is used to create an image in order to attract customers. f) Retail industry The sale of goods or commodities in small quantities directly to consumers. g) Customers A person, company, or other entity which buys goods and services produced by another person, company, or other entity. h) Retailers One who sells goods or commodities directly to consumers. These items are purchased from the manufacturer or wholesaler and sold to the end user at a marked up price.

1.10

LIMITATION OF STUDY 1.10.1 Time Constraint The major limitation in conducting this research is time constraint. In order to acquire accurate data, a period of time is required to gather all the

information needed for the research purpose. The researcher has a limited time to gather and obtain full information on selected topics to conducting this study in order to provide good research project.

1.10.2 Availability and Confidentiality of Data A problem occurs upon obtaining certain data from the retailers. By depending the data form questionnaire only is not sufficient. Some information cannot be obtained from the retailers themselves.

1.10.3 Lack of Respondents Co-operation Some of the respondents will not give their full co-operation during the questionnaire survey and some of them refuse to be the respondent. This is because; researcher is given the questionnaire when the retailers are busy entertaining their customers.

CHAPTER 2 LITERATURE REVIEW

CHAPTER 2
2.0 LITERATURE REVIEW In this chapter, literature review is used as the basis of conducting the study. It will discuss the topic of the factors that influence customers perception on retail

store image in retail outlets. This literature review will give a cleared view on what this study is about.

2.1

RETAIL STORE IMAGE The complex of a consumers perceptions of a store on different (salient) attributes. This definition is in line with the definition of Houston and Nevin (1981). However, over the years different authors have distinguished different store attributes or characteristics that are part of the overall image towards the store (the so-called retail mix). For example, Lindquist (1974), in his study on the store image literature, has combined models from 19 studies and came up with nine different elements: merchandise, service, clientele, physical facilities, comfort, and promotion, and store atmosphere, institutional and post-transaction satisfaction. Doyle and Fenwick (1974) distinguished only five elements: product, price, assortment, styling and location. Bearden (1977) suggested the following characteristics: price, quality of the merchandise, assortment, atmosphere, location, parking facilities and friendly personnel. More recently, store image is supposed to be composed of the different elements of the retail marketing mix as introduced by Ghosh (1990). These eight elements are: location, merchandise, store atmosphere, customer service, price, advertising, personal selling and sales incentive programs. For each retail store a distinct image may exist within consumers minds. This is based on the salient elements of the retail mix. The merchandise of a retailer is its most important retail mix element, according to Ghosh (1990). A retailer has to make sure that he/she offers those products to his/her customers that they expect him/her to offer.

Nevertheless, other nonfunctional elements also have to be in line with the expectations of the customer in order for a customer to become store loyal.

2.2

BRAND IMAGE A well-recognized and accepted brand image is one of the most valuable assets a firm possesses. Brand managers and manufacturers are concerned with managing brand equity and capitalizing on the value of a brand image (Aaker, 1991). Favorable images of brands positively influence patronage decisions and purchase behaviors, while unfavorable images adversely influence such decisions and behaviors. In other words, the images associated with the brands a store carries influence a stores image, which in turn, influences consumers decision-making processes and behaviors. Consequently, brand image and retail image are inextricably linked to one another. Recently it has been suggested that the inferences buyers make about the merchandise quality of a store directly influence retail image (Baker et al., 1994). Brand image often serves as an informational cue used by buyers to form inferences about a stores merchandise quality (Olshavsky, 1985). Knowing that brand image helps form merchandise quality inferences that influence buyers perceptions of retail image, we propose that two informational cues help buyers form these inferences. First, the awareness level of brands carried by a store helps buyers form merchandise quality inferences that influence their perceptions of retail image. Second, the presence of a brand(s) having strong awareness, recognition, and quality perceptions an anchor brand influences buyers inference-making and impressions of retail image. This perspective suggests that brand and retail managers need to be concerned not only with the influence that specific anchor

brands images have on a retail stores image, but also the effect that the overall image of the brand mix carried by a store has on buyers perceptions of a retail stores image. Retail store image is an overall impression of a store as perceived by consumers (Keaveney and Hunt, 1992). One of the commonly accepted formal definitions of retail store image is an individuals cognitions and emotions that are inferred from perceptions or memory inputs that are attached to a particular store and which represent what that store signifies to an individual (Baker et al., 1994; Mazursky and Jacoby, 1986). A strong brand image offers an organization several important strategic advantages. A brand distinguishes the goods and services of one seller from those of competitors. A powerful brand identity creates a major competitive advantage; a well recognized brand encourages repeat purchases. Thus, a brand acts as a signal to consumers regarding the source of the product and protects customers and manufacturers from me-too products that may appear identical. Brand image consists of consumer knowledge and beliefs, stored in memory as associations, about brand attributes and the consequences of brand use (Peter and Olson, 1994). In a recent study, Baker et al. (1994) discovered that inferences that consumers made about merchandise quality were direct determinants of retail image. In other words, the merchandise inferences influenced consumers thoughts and feelings about a store. Therefore, merchandise quality can be viewed as a key variable that influences retail image. When brand images are associated with retailers having more favorable retail images, there is little change or influence to the brands image (Jacoby and Mazursky, 1984). This suggests that brand image plays a major role in the development of a consumers perception of retail image (Zimmer and Golden, 1988).

2.3

SOCIAL-CUES (CUSTOMER SERVICE) Consumers had a more favorable attitude toward merchandise and service quality and felt more aroused or pleased with a store where more social cues were present. They also had a more favorable perception of store image when high-personalized service was provided. Consumers perceived that they would be more likely to shop in a store that had more in-store displays of graphics with social meaning. Recent research has revealed that since the early years of modern retailing, stores have served not only as a place for purchasing goods, but also as a place for socializing (Skoll, 1999). But for many consumers, value is not simply defined as the ratio of price versus utility. Experiential value, for instance, includes the dimensions of playfulness and aesthetic appeal (Mathwick et al., 2001). Furthermore, shopping is a socially visible behavior, frequently done while accompanied by friends or family members; that is to say, consumers seek to satisfy social needs when shopping (Evans et al., 1996; Jones, 1993). For example, when consumers feel lonely, social contacts made casually in retail stores have been shown to fill a social void (Rubenstein and Shaver, 1980). It is also known that consumers shop not only for personal reasons, but also for social motives. These social shopping motives include: social experiences outside the home; communication with others, especially those with similar interests; peer group attraction reflecting a desire to be with ones peer group or a reference group to which one aspires to belong; status and authority; and The pleasure of bargaining (Tauber, 1995).

Some retailers are suspicious about whether such efforts would improve store image and, in turn, their bottom lines (Haeberle, 2001). The perception of a store can be based on both physical and social cues represented schematically in the consumers mind. The central focus of a store is the point of sale. The sales transaction that occurs here the exchange between salesperson and customer is the defining social moment in a stores existence. The quality of this social encounter is determined by how well a salesperson can interpret a customers needs and interact in a congenial manner. An enhanced interaction between the sales associate and customer is referred to as personalization of service. Personalization is characterized by an employees politeness and courtesy, attempts to get to know customers as individuals, and engagement in friendly conversation (Mittal and Lassar, 1996). Mittal and Lassar (1996) found that personalization significantly influences customer evaluations of service quality; and that consumers seek familiar, friendly service providers and retail salespeople. 2.4 STORE ATMOSPHERE Mehrabian and Russell (1974) note that the response that atmosphere elicits from consumers varies along three main dimensions of pleasantness, arousal, and dominance. This response, in turn, influences behavior, with greater likelihood of purchase in more pleasant settings and in settings of intermediate arousal level. Different elements of a retailers in-store environment, e.g., color, music, and crowding, can influence consumers perceptions of a stores atmosphere, whether or not they visit a store, how much time they spend in it, and how much money they spend there (Bellizzi, Crowley, and Henderson 1983; Milliman 1982; Eroglu and Machleit 1990; Grewal et al. 2003). Baker et al. (2002)

provide a good review of this research and categorize the elements of in-store atmosphere into physical features like design, lighting, and layout, ambient features like music and smell, and social features like type of clientele, employee availability and friendliness. They note that atmosphere can affect consumers perceptions of the economic and psychological costs of shopping in a store and find that pleasing physical design lowers both economic and psychological costs while music lowers the latter. Store atmosphere mediates consumer perceptions of other dimensions of store image. For instance, Baker et al. (2002) find that store environment factors, particularly physical design perceptions, significantly affect consumers perceptions of merchandise price, merchandise quality, and employee service quality. Schlosser (1998) argues that, since store atmosphere has a social identity appeal, a pleasing atmosphere in the store should influence perceptions of socially communicative products in the store, not so much intrinsically rewarding products. This logic can be extended to argue that store atmosphere would have a greater impact on perceptions of products with higher perceived (social) risk. Indeed, Richardson, Jain, and Dick (1996) do find that consumers ratings of the private labels quality are higher when the store is aesthetically pleasing than when it is less attractive, although there is no significant difference in their ratings of national brands quality. In summary, a pleasing in-store atmosphere provides substantial hedonic utility to consumers and encourages them to visit more often, stay longer, and buy more. Although it also improves consumers perceptions of the quality of merchandise in the store, consumers tend to associate it with higher prices. From a branding perspective, an appealing in-store atmosphere offers much potential in terms of crafting a unique store image and establishing differentiation. Increasingly, brands are being positioned on the basis of their intangibles and attributes and benefits that

transcend product or service performance. Even if the products and brands stocked by a retailer are similar to others, the ability to create a strong in-store personality and rich experiences can play a crucial role in building retailer brand equity.

2.5

PRICE The use of reference prices in retail advertisements is a very common practice for increasing the attractiveness of an offer. Not surprisingly, such widespread use of reference prices has spurred enormous interest among academic

researchers who have investigated buyer perceptions and evaluations of such claims over the last three decades (Bearden et al., 1984; Berkowitz and Walton, 1981; Biswas et al., 1999; Blair and Landon, 1981; Della Bitta et al., 1981; Janiszewski and Lichtenstein, 1999; Lichtenstein and Bearden, 1989;

Lichtenstein et al., 1991; Liefield and Heslop, 1985; Urbany et al., 1988). Previous research has consistently found a strong positive effect of advertised reference prices on consumer evaluation, but the concern lies with the potentiality of reference prices to deceive consumers. Compeau and Grewal (1998) criticize the use of exaggerated reference prices, and state that the potentiality for deception seems rife because external reference prices have a strong influence on consumers, even when they are exaggerated A retailers price image should be influenced by attributes like average level of prices, how much variation there is in prices over time, the frequency and depth of promotions, and whether the retailer positions itself as EDLP or HILO. Decades ago, however, Brown (1969) highlighted the difference between

consumers perceptions of price levels in various stores and reality, showing that consumers may use non-price related cues like service offerings and quality levels to form their price perceptions. That consumers may not form valid perceptions of actual prices in a store is supported by Dickson and Sawyers (1990) widely cited work, but consumers do develop some general price perceptions of products in a store, and can evaluate their expensiveness in relative terms (Monroe and Lee 1999). Desai and Talukdar (2003) develop a product-price saliency framework to examine how consumers form an overall store price image (OSPI). They show that products with high unit prices and high purchase frequency are more salient and therefore contribute more to OSPI, with purchase frequency dominating unit price in importance. Alba et al. (1994) examine how consumers perceptions of store prices change with prior beliefs and information about how frequently a store has a price advantage on a set of products and the magnitude of that price advantage. They find that, although prior beliefs affect price perceptions, frequency of price advantage dominates both prior beliefs and magnitude of price advantage in influencing consumers perceptions of store price level.

CHAPTER 3 RESEARCH METHODOLOGY

CHAPTER 3: RESEARCH METHODOLOGY 3.0 INTRODUCTION This chapter discusses on the part of methodology that being applied in this research. It comprised of the theoretical framework discussion pertaining the

independent variables which are brand image, social cues (customer service), store atmosphere and price towards dependent variables which are retail store image. Besides that, this chapter also discuss about the hypothesis, research design, population and sampling, data collection method, and data processing.

3.1

RESEARCH DESIGN The research design of this research is descriptive study. A descriptive study is undertaken in order to ascertain and be able to describe the characteristics of the variables of interest in a situation. In such cases, a study of a class in term of the percentages of members who are in their senior and junior senior years, sex compositions, age groupings, number of semesters left until graduation, and number of business courses taken, can be considered as descriptive in nature. Quiet frequently, descriptive study undertaken in organization to learn about and describe the characteristics of a group of employees, as for example, the age, education level, job status, and length of services of Hispanics or Asians, working in the system. Descriptive study are also undertaken to understand the characteristics of organizations that follow certain common practices. The goal of descriptive study hence is to offer to the researcher a profile or to describe relevant aspect, of the phenomena of interest from an individual, organizational, industry oriented or other perspective. For example in this research, the researcher used descriptive study to collect the information characteristics of respondent for this study. The characteristics that the researcher uses in this study are gender, age, status and

also occupation or working sector of the respondents. So that the researcher can easily know about the respondents that involve in this study and can easily to analyze them to show the frequency of the respondents characteristics. 3.2 SAMPLING DESIGN 3.2.1 Population Population refers to the entire group of people or things of interest that the researcher wishes to investigate. For this research, the population is the entire resident in Shah Alam, Selangor. 3.2.2 Sample A sample is a subset of the population. It comprises some members selected from the population. In other words, some of the elements in the population would from the sample. In this research, the sample is from the customers that are come and enter to the retail store, which is at SACC mall and Plaza Alam Sentral. 3.2.3 Sampling Methods For this conducted research, the researcher has chosen non-probability sampling design as the sampling methods. Non-probability sampling design can be divided into convenience sampling, judgment sampling and quota sampling. Convenience samplings have been used to collect the information from the members of the population who are conveniently available to provide it. Meaning to say that, the researchers have chose the convenience samplings due to the residents in Shah Alam that already have an idea about retail store in the area. Convenience sampling is the best way to get the information more quickly and efficiently due to limitation of time.

3.2.4

Sample Size Sample size is the number of members selected from the population. The sample size that the researchers use for this research study is 250 residents in Shah Alam. Because of the limitation that the researchers face, only 250 residents have been chose for the sample size. The main limitation that the researcher faces is the time taken for the study. If the sample size is large, it cannot cover all respondents due to the limited allocated time.

3.3

DATA COLLECTION METHOD In this study, researcher will collect data through two resources; primary data and secondary data. 3.3.1 Primary Data

3.3.1.1 Questionnaire Primary data originated for a specific purpose of addressing the research problem in hand. The primary data will be gathered through structured questionnaire. The primary data of this study will be gathered through 250 sets of questionnaires that will be distributed to customers. Questionnaire is a set of question designed to generate the data necessary for accomplishing the objectives of the research project. These questionnaires contain structured or closed-ended question that is a rating scale and likert scale to provide answers to organizations. 3.3.2 Secondary Data 3.3.2.1 Reference books

Several references books are used in obtaining information for this research. 3.3.2.2 Internet Most of the information is also obtained through the internet. 3.4 QUESTIONNAIRE This research has been tested by distributing the questionnaires to 250 selected respondents from different gender, age, occupation and marital status. The questionnaire consists of related questions relating to the variables in order to discover the responses to the problem. It consists of nominal scale, interval scale, dichotomous scale, likert scale and close question method. The questionnaires are being divided in (6) six sections that is parts A is question on brand image, part B is on social cues(customer service), part C is on store atmosphere and part D is on price and part E is on retail store image. Lastly is part F which is on demographic. The distributed questionnaires are classified as structured questions which limit the number of responses available. In part A, the question asked is on brand image provided by retail outlet. It is whether the product is quality and is the products satisfied customers needs. While in part B the question is on customer service provide by the store. This is to know whether services provide are effective and efficient or not. In part C, the question is on store atmosphere. This is to know whether the retail outlet is attractiveness or not. In part D, the question is on price, customers are been asking about the price given by the retail outlet. This is whether the price setup by the retail outlet is competitive or not. In part E, the

question is on retail store image. This is to know which factor is most influence consumer perception on retail store image. Lastly in part F is the question on demographic. 3.5 DATA PROCESSING The researcher used Scientific Program of Social Science (SPSS student Version 17.0 for Window) application to analyze the datas that have been gathered through out the research process. The data need to be analyzed in order to obtain accurate answer for the question. The coding process involves assigned code to represent every possible respond to questionnaire. The

codebook is prepared earlier whereby the instruction for coding and variables involve information in the data set will be explained. The codebook helps the researcher to identify the variable during the process of coding. Figure 3.1 will present the research steps following data collection that are related to processing and analysis. Below is stage of data processing:-

CHAPTER 4

FINDINGS & DATA ANALYSIS

CHAPTER 4: FINDINGS 4.0 INTRODUCTION This chapter focuses on the findings of the data that has been analyzed which will show the result of reliability analysis, demographic background, frequency distribution analysis, correlation analysis and also regression analysis. These findings are derived from all 250 set of questionnaires that were distributed to the respondents who were also the customers that have had experienced in retail store image. 4.1 RELIABILITY ANALYSIS

According to (Uma Sekaran, 2003), reliability test is to measure the consistency and stability of the items towards the research. Cronbachs alpha is a reliability coefficient that indicates how well the items in a set are positive correlated to one another. In this reliability analysis discusses the consistency of independent variables which are brand image, customer service, store atmosphere and price, while dependent variable which is retail store image. 4.1.1 BRAND IMAGE FACTOR TABLE 4.1: Reliability for Brand Image Factor Cronbach's Alpha .756 N of Items

Table 4.1 indicates that the Cronbachs Alpha for the study is 0.756. According to Uma Sekaran (fourth edition) when Cronbachs Alpha is less than .60 are considered to be poor, those in the .70 range, acceptable, and those over .80 good. Its different with W.Zikmund (2005), where, when Cronbach's Alpha is between 0.7 and 1.0, it is very good. If the reliability is between 0.5 and 0.6, it is average and if the reliability is below 0.5, it is very poor. Based on the Table 4.1 above, in this research, Cronbach Alpha is 0.756, so according to Uma Sekaran this reliability is acceptable. It shows that all 5 questions include in brand image factor are relevant to the research.

4.1.2

SOCIAL CUES FACTOR

TABLE 4.2: Reliability for Social Cues Factor Cronbach's Alpha N of Items

.752

Table 4.2 indicates that the Cronbachs Alpha for the study is 0.752. According to Uma Sekaran (fourth edition) when Cronbachs Alpha is less than .60 are considered to be poor, those in the .70 range, acceptable, and those over .80 good. Its different with W.Zikmund (2005), where, when Cronbach's Alpha is between 0.7 and 1.0, it is very good. If the reliability is between 0.5 and 0.6, it is average and if the reliability is below 0.5, it is very poor. Based on the Table 4.2 above, in this research, Cronbach Alpha is 0.752, so according to Uma Sekaran this reliability is acceptable. It shows that all 5 questions include in c social cues factor are relevant to the research. 4.1.3 STORE ATMOSPHERE FACTOR TABLE 4.3: Reliability for Store Atmosphere Factor Cronbach's Alpha .710 N of Items

Table 4.3 indicates that the Cronbachs Alpha for the study is 0.710. According to Uma Sekaran (fourth edition) when Cronbachs Alpha is less than .60 are considered to be poor, those in the .70 range, acceptable, and those over .80 good. Its different with W.Zikmund (2005), where,

when Cronbach's Alpha is between 0.7 and 1.0, it is very good. If the reliability is between 0.5 and 0.6, it is average and if the reliability is below 0.5, it is very poor. Based on the Table 4.3 above, in this research, Cronbach Alpha is 0.710, so according to Uma Sekaran this reliability is acceptable. It shows that all 6 questions include in store atmosphere factor are relevant to the research.

4.1.4

PRICE FACTOR TABLE 4.4: Reliability for Price Factor Cronbach's Alpha .804 N of Items

Table 4.4 indicates that the Cronbachs Alpha for the study is 0.804. According to Uma Sekaran (fourth edition) when Cronbachs Alpha is less than .60 are considered to be poor, those in the .70 range, acceptable, and those over .80 good. Its different with W.Zikmund (2005), where, when Cronbach's Alpha is between 0.7 and 1.0, it is very good. If the reliability is between 0.5 and 0.6, it is average and if the reliability is below 0.5, it is very poor. Based on the Table 4.4 above, in this research, Cronbach Alpha is 0.804, so according to Uma Sekaran this reliability is good. It shows that all 5 questions include in price factor are relevant to the research.

4.1.5

RETAIL STORE IMAGE

TABLE 4.5: Reliability for Retail Store Image Factor Cronbach's Alpha N of Items

.780

Table 4.5 indicates that the Cronbachs Alpha for the study is 0.780. According to Uma Sekaran (fourth edition) when Cronbachs Alpha is less than .60 are considered to be poor, those in the .70 range, acceptable, and those over .80 good. Its different with W.Zikmund (2005), where, when Cronbach's Alpha is between 0.7 and 1.0, it is very good. If the reliability is between 0.5 and 0.6, it is average and if the reliability is below 0.5, it is very poor. Based on the Table 4.5 above, in this research, Cronbach Alpha is 0.780, so according to Uma Sekaran this reliability is acceptable. It shows that all 4 questions include in consumer perception factors are relevant to the research. 4.2 FREQUENCY DISTRIBUTION This part shows the demographic characteristic of the respondents that shopping at retail store. Demographic backgrounds here examined in this research are gender, age, marital status, and lastly working sector. 4.2.1 GENDER

TABLE 4.6: RESPONDENTS GENDER

Valid

MALE FEMALE Total

Frequenc y 114 136 250

Percent 45.6 54.4 100.0

Valid Percent 45.6 54.4 100.0

Cumulative Percent 45.6 100.0

Table Table 4.6 shows the frequency and percentage by respondents gender. Out of 250 respondents in this research, 136 female and 114 male customers are involved in this survey. Their percentages were 54.4 percent and 45.6 percent respectively.
FIGURE 4.1: PERCENTAGE OF RESPONDENTS GENDER

GEND ER
45.6%
MALE

54.4%

FEMALE

4.2.2

AGE

TABLE 4.7: RESPONDENTS AGE

Frequency Valid 20-30 31-40 41-50 Total 163 84 3 250

Percent 65.2 33.6 1.2 100.0

Valid Percent 65.2 33.6 1.2 100.0

Cumulative Percent 65.2 98.8 100.0

Table 4.7 indicates the frequency and percentage by respondents age. In terms of age it divided respondents into 3 categories, the minority respondents only 3 customers where in the third category (41-50 years), this constituted (1.2%) of sample. This followed by those in second category (31-40 years), 84 respondents and its shows (33.6%) in this age category. The majority respondents are in the first category (20-30 years), 163 respondents which is (65.2%) in this age category.
FIGURE 4.2: PERCENTAGE OF RESPONDENTS AGE

AGE
1.2% 0%

33.6% 65.2%

20-30 YEARS 31-40 YEARS 41-50 YEARS 51 AND ABOVE

4.2.3

STATUS

TABLE 4.8: RESPONDENTS STATUS Frequency Valid SINGLE MARRIED Total 146 104 250 Percent 58.4 41.6 100.0 Valid Percent 58.4 41.6 100.0 Cumulative Percent 58.4 100.0

Table 4.8 indicates the frequency and percentage by respondents status. In terms of status, more respondents in single status (146) rather than married status (104), with respective percentage 58.4 percent and 41.6 percent in this research. It shows that, single peoples are more than married peoples to spend their time to shopping at the retail store.
FIGURE 4.3: PERCENTAGE OF RESPONDENTS STATUS

S T A TUS

41.6% 58.4%
SINGLE MARRIED

4.2.4

OCCUPATION

TABLE 4.9: RESPONDENTS OCCUPATION Frequency Percent Valid STUDENT GOVERNME NT PRIVATE Total 77 73 100 250 30.8 29.2 40.0 100.0 Valid Percent 30.8 29.2 40.0 100.0 Cumulative Percent 30.8 60.0 100.0

Table 4.9 shows that majority of respondents work in private sector with 100 respondents which are 40%. While, the minority of respondents are work in government sector with 73 respondents which are 29.2%. Besides that, there are also students taken place in this survey with 77 respondents which are 30.8%. That mean not only working peoples are going for the shopping but students are also going for the shopping at retail store.
FIGURE 4.4: PERCENTAGE OF RESPONDENTS OCCUPATION

OCCUP A TION

40%

30.8%

STUDENT GOVERNMENT PRIVATE

29.2%

4.3

DESCRIPTIVE ANALYSIS

4.3.1

BRAND IMAGE FACTOR

TABLE 4.10: Descriptive Statistics For Brand Image Factor

n A1_SATISFY A2_QUALITY A3_UNIQUENESS A4_GOOD A5_VARIETIES Valid n (list wise) 250 250 250 250 250 250

Minimum 3.00 3.00 3.00 3.00 3.00

Maximum 5.00 5.00 5.00 5.00 5.00

Mean 4.3040 4.3040 3.9720 4.2840 3.9080

Std. Deviation .56999 .52601 .56966 .66113 .57695

Table 4.10Table 4.10 shows that satisfy and quality variable get the highest mean among other variables with same mean, with 4.3040. It followed by good image variable and uniqueness variable with 4.2840 and 3.9720 respectively. The lowest mean for brand image variable is varieties with 3.9080. Its mean that both satisfy and quality of the brand image of the product at retail store play important role to influence retail store image. In terms of maximum and minimum answer for every variable, all variable in brand image factor get 5.00 which mean strongly agree for maximum answer while 1.00 which is strongly disagree for the minimum answer.

4.3.2

SOCIAL CUES FACTOR

TABLE 4.11: Descriptive Statistics For Social Cues Factor Std. Deviation .61129 .63246 .63221 .58414 .69993

n B6_SATISFY B7_UNDERSTAND B8_FRIENDLY B9_HELP B10_PATIENTLY Valid n (list wise) 250 250 250 250 250 250

Minimum Maximum 3.00 2.00 3.00 3.00 2.00 5.00 5.00 5.00 5.00 5.00

Mean 4.2680 3.9600 4.1480 3.9880 3.9920

Table 4.11 shows that satisfy and friendly get the highest mean among other variables with 4.2680 and 4.1480. It followed by patiently variable and help variable with 3.9920 and 3.9880 respectively. The lowest mean for social cues variable is understand with 3.9600. Its mean satisfy and friendly by the retailers at retail store play important role to influence retail store image. In terms of maximum and minimum answer for every variable, all variable in brand image factor get 5.00 which mean strongly agree for maximum answer while 2.00 which is disagree for the minimum answer.

4.3.3

STORE ATMOSPHERE FACTOR

TABLE 4.12: Descriptive Statistics For Store Atmosphere Factor n C11_ATTRACTIVE C12_UNIQUENESS C13_COMFORTABL E C14_EFFECTIVE C15_EFFECIENT C16_CONDUSIVE Valid n (list wise) 250 250 250 250 250 250 250 Minimum Maximum 3.00 3.00 3.00 3.00 2.00 2.00 5.00 5.00 5.00 5.00 5.00 5.00 Mean 4.3280 3.9480 4.2960 3.8960 3.8200 3.8240 Std. Deviation .66194 .55364 .69449 .64408 .63657 .64707

Table 4.12 shows that attractive and comfortable get the highest mean among other variables with 4.3280 and 4.2960. It followed by uniqueness variable with 3.9480 respectively. The lowest mean for store atmosphere variable is understood with 3.8200. Its mean attractive and comfortable of store atmosphere in retail store play important role to influence retail store image. In terms of maximum and minimum answer for every variable, all variable in brand image factor get 5.00 which mean strongly agree for maximum answer while 2.00 which is disagree for the minimum answer.

4.3.4

PRICE FACTOR

TABLE 4.13: Descriptive Statistics For Price Factor n D17_SATISFY D18_REASONABLE D19_AFFORDABLE D20_SUITABLE D21_M.FACTOR Valid n (list wise) 250 250 250 250 250 250 Minimum 1.00 1.00 1.00 1.00 1.00 Maximu m 5.00 5.00 5.00 5.00 5.00 Mean 3.9360 3.6760 3.5920 3.3960 4.1400 Std. Deviation .93348 .85201 .94504 .80609 1.02597

Table 4.13 shows that main factor variable get the highest mean among other variables with mean 4.1400. It followed by satisfy variable with 3.9360 respectively. The lowest mean for price factor is suitable which is in 3.3960. Its mean that customers are more depend on the price of the products that the retailers offer at retail store and its become an important role to influence retail store image. In terms of maximum and minimum answer for every variable, all variable in brand image factor get 5.00 which mean strongly agree for maximum answer while 1.00 which is strongly disagree for the minimum answer.

4.3.5

RETAIL STORE IMAGE

TABLE 4.14: Descriptive Statistics For Retail Store Image n E22_B.IMAGE E23_SERVICE E24_S.ATMOSPHERE E25_PRICE Valid n (list wise) 250 250 250 250 250 Minimu Maximum Mean m 1.00 1.00 1.00 1.00 5.00 5.00 5.00 5.00 2.8640 3.0880 3.0000 3.1080 Std. Deviation 1.25371 1.23871 1.24507 1.39431

Table 4.14 shows that all variable in the price factor get the highest mean among other factors with mean 3.1080. It followed by service factor with 3.0880 and store atmosphere with 3.0000 respectively. Lastly the lowest mean is brand image factor which is 2.8640. Its mean that compare to the other variable, most of the customers said that price is the main factor for customers at retail store as important role to influence retail store image. In terms of maximum and minimum answer for every variable, all variable in brand image factor get 5.00 which mean strongly agree for maximum answer while 1.00 which is strongly disagree for the minimum answer.

4.4

CORRELATION ANALYSIS 4.4.1 The relationship between brand image and retail store image.

RESEARCH OBJECTIVE To determine the extent influence between brand image and retail store image RESEARCH QUESTION Is there a significant relationship between brand image and retail store image in this research? HYPOTHESIS 1 There is a relationship between brand image and retail store image. TABLE 4.15: CORRELATION BETWEEN BRAND IMAGE VS RETAIL STORE IMAGE

Brand Image Brand Image Pearson Correlation Sig. (2-tailed) n Retail Store Pearson Correlation Image Sig. (2-tailed) n 250 .520** .000 250 1

Retail Store Image .520** .000 250 1 250

**. Correlation is significant at the 0.01 level (2-tailed).

Based on Table 4.15, by using the Pearson Correlation, the correlation coefficient between brand image and retail store image is r = 0.520. Therefore, there is a moderate and positive relationship between brand image and retail store image. Since p = 0.000 is less than = 0.05, null hypothesis, H0 is rejected and research hypothesis, H1 is accepted. Thus,

there is a significant relationship between brand image and retail store image and accept the alternative hypothesis (H1). 4.4.2 The relationship between customer services and retail store image. RESEARCH OBJECTIVE To examine the extent influence between social-cues (customer services) and retail store image RESEARCH QUESTION Is there a significant relationship between social-cues (customer services) and retail store image in this research? HYPOTHESIS 2 There is a relationship between social-cues (customer service) and retail store imag TABLE 4.16: CORRELATION BETWEEN CUSTOMER SERVICE VS RETAIL STORE IMAGE

Customer Service Customer Service Pearson Correlation Sig. (2-tailed) n Retail Store Pearson Correlation Image Sig. (2-tailed) n 250 .525** .000 250 1

Retail Store Image .525** .000 250 1 250

**. Correlation is significant at the 0.01 level (2-tailed).

Based on Table 4.16, by using the Pearson Correlation, the correlation coefficient between social cues and retail store image is r = 0.525. Therefore, there is a moderate and positive relationship between social cues and retail store image. Since p = 0.000 is less than = 0.05, null hypothesis, H0 is rejected and research hypothesis, H1 is accepted. Thus, there is a significant relationship between social cues and retail store image and accept the alternative hypothesis (H1). 4.4.3 The relationship between store atmosphere and retail store image. RESEARCH OBJECTIVE To investigate the extent influence between store atmosphere and retail store image RESEARCH QUESTION Is there a significant relationship between store atmosphere and retail store image in this research? HYPOTHESIS 3 There is a relationship between store atmosphere and retail store image.

TABLE 4.17: CORRELATION BETWEEN STORE ATMOSPHERE VS RETAIL STORE IMAGE

Store Atmosphere Store Atmosphere Pearson Correlation Sig. (2-tailed) n Retail Store Image Pearson Correlation Sig. (2-tailed) n **. Correlation is significant at the 0.01 level (2-tailed). 250 .544** .000 250 1

Retail Store Image .544** .000 250 1 250

Based on Table 4.17, by using the Pearson Correlation, the correlation coefficient between store atmosphere and retail store image is r = 0.544. Therefore, there is a moderate positive relationship between store atmosphere and retail store image. Since p = 0.000 is less than = 0.05, null hypothesis, H0 is rejected and research hypothesis, H1 is accepted. Thus, there is a significant relationship between store atmosphere and retail store image and accept the alternative hypothesis (H1). 4.4.4 The relationship between price and retail store image. RESEARCH OBJECTIVE To study the extent influence between price and on retail store image RESEARCH QUESTION Is there any significant relationship between price and retail store image in this research?

HYPOTHESIS 4 There is a relationship between price and retail store image. TABLE 4.18: CORRELATION BETWEEN PRICE VS RETAIL STORE IMAGE

Price Price Pearson Correlation Sig. (2-tailed) n Retail Store Image Pearson Correlation Sig. (2-tailed) n **. Correlation is significant at the 0.01 level (2-tailed). 250 .524** .000 250 1

Retail Store Image .524** .000 250 1 250

Based on Table 4.18, by using the Pearson Correlation, the correlation coefficient between price and retail store image is r = 0.524. Therefore, there is a moderate and positive relationship between price and retail store image. Since p = 0.000 is less than = 0.05, null hypothesis, H0 is rejected and research hypothesis, H1 is accepted. Thus, there is a significant relationship between price and retail store image and accept the alternative hypothesis (H1).

4.5

REGRESSION ANALYSIS 4.5.1 BRAND IMAGE, SOCIAL CUES, STORE ATMOSPHERE AND PRICE VS RETAIL STORE IMAGE

TABLE 4.19: MODEL SUMMARY

Mode l 1

R .739a

R Square .546

Adjusted R Square .538

Std. Error of the Estimate .82312

a. Predictors: (Constant), price, brand image, store atmosphere, customer service

TABLE 4.20:COEFFICIENTSA

Unstandardized Coefficients Model 1(Constant)

BRAND IMAGE CUSTOMER SERVICE STORE ATMOSPHERE PRICE

Standardized Coefficients Beta .378 .056 .028 .370 t -7.978 4.243 .555 .370 5.889 Sig. .000 .000 .579 .712 .000

B -4.105 .958 .123 .061 .660

Std. Error .515 .226 .222 .165 .112

a. Dependent Variable: consumer perception

From the table 4.19, it shows that the R Square for above model summary is 0.538 which mean 54% of the variance has been significantly explained by the set of predictors. The set of predictors are brand image, customer services, store atmosphere and price.

From the table 4.20, it shows that 2 of the independent variables which are brand image and price have significant relationship towards dependent variable which is retail store image. Among all variables, brand image have very significance relationship towards retail store image which is 0.378. It then followed by price with 0.370, social cues (customer service) with 0.056, and lastly store atmosphere with 0.028. From the table, we can see that brand image is important element towards retail store image according answer from the respondents.

CHAPTER 5 CONCLUSION & RECOMMENDATIONS

CHAPTER 5: CONCLUSION AND RECOMMENDATIONS 5.0 INTRODUCTION This chapter presents the conclusions of the study based on the research objectives and some recommendations that can help in improving consumer perception towards retail store image in retail industry. 5.1 CONCLUSION The result of this study identifies four factors that can influence customers perception towards retail store image. Where the factors are consists of brand image factor, customer service factor, store atmosphere factor and also price factor. This entire factor has been tested and selected respondent who visited and come for shopping at SACC MALL and Plaza Alam Sentral. For the dependent variables (retail store image), Cronbach Alpha for the study is 0.780, so this reliability is acceptable. While, for the independent variables, Cronbach Alpha for brand image is 0.756 means that the reliability is acceptable. For customer service, the result indicates that the Cronbach Alpha is 0.752, for store atmosphere, Cronbach Alpha for the study is 0.710 so this reliability is acceptable. For last independent variable which is price, the result indicates that the Cronbach Alpha is 0.804, so this reliability is good. In this research, the questionnaires for this research are distributed to 250 respondents at the SACC Mall and Plaza Alam Sentral in Shah Alam area. Generally, 54.4 % of the total respondents are female and 58.4% of the total respondents status is single. The leading numbers of respondents are from 20 to

30 years old which represented 65.2% of total respondents. Majority of the respondents are works in a private sector which represented 40% of total respondents. The result of this research has led the researcher to answer all the research objectives that the researcher intended to achieve. The research objective for this study is to identify the significant relationship between four factors which is brand image, customer service, store atmosphere and price can influence on the retail store image. In order to identify the relationship between those factors and retail store image, research questions and hypotheses for each factor is formulated. Those hypotheses are tested using the Pearson Correlation. For the first research question and hypothesis, the result indicates that there is a significant, positive and moderate relationship between brand images with retail store image. Followed by the result for second research questions and hypothesis of significant between customer service and retail store image are positive and moderate relationship. For the third research question and hypothesis, the result indicates that there is a significant, positive and moderate relationship between store atmosphere and retail store image. Lastly, for the forth research question and hypothesis, the result indicates that there is a significant, positively and also have a moderate relationship between price and retail store image. Multiple regression analysis is to predict dependent with all independent variables. The result shows that 53.8% of the variance can be explained by all independent variable (brand image, customer service, store atmosphere and

price). By look at Beta under Standard Coefficients, it can see that have one highest number in the beta is 0.378 for brand image. 5.2 RECOMMENDATIONS From the experience, all the retailers should more focus in their factors or element of retail store image to get an attention and attract customers to come and enter to the retail store and have a good perception towards the retail store image. Some of the retail stores are only focus on one or two factors that they apply in their retail store. Because of that, they are not give a good image and cant get a good perception from the customers. Some of the recommendation that the researcher can suggest to improve the retailers to have a good retail store image are like retailer must be more focus and aware about what their customers more consider when they are shopping in the retail store. When the retailers are known what actually their customers more consider then, they are easier to get a good perception from the customers and give a satisfaction to the customers. The other suggests is the management should continue the competition among the retail store to get the best retail store and extent the competition to the international. So that the retailers will have more motivation to do the best and more focus on their retail store image by focus and improve in the retail store image factors that can influences the customer perception towards the retail store image. For the competition the management also should offer them a grand prize for the winner. Lastly, the management also must give a penalty to the retailers which are getting a higher complaint from the customers about their retail store like

weakness in their brand image, customer service, store atmosphere or not suitable price for their products. FUTURE RESEARCH In terms of future research, the next researcher can do their research with focusing towards the others factors. It is because according to the past researchers and journal there are a lot of factors or elements of retail store image. My research is just based on brand image, social cues (customer service), store atmosphere and price factors only. However, in others factors there are other factors or elements such as target market, firms positioning, store location, shopping experiences, community service promotional tools and so on. Besides that, the next researcher can come out with a better recommendation and suggestion towards the company.

BIBLIOGRAPHY JOURNALS Kusum L.Ailawadi, Kevin Lane Keller (2004), Understanding Retail Branding, Conceptual Insights And Research Priorities. Retrieved September 27, 2004 Haiyan Hu, Cynthia R.Jasper (2006), Social Cues In The Store Environment And Their Impact On Store Image, International Journal Of Retail And Distribution Management, Emerald Group Publishing Limited Archna Vahie and Audhesh Paswan (2006), Private Label Brand Image: Its Relationship With Store Image And National Brand, International Journal Of Retail And Distribution Management, Emerald Group Publishing Limited Stephen S.Porter and Cindy Claycomb, The Influence Of Brand Recognition On Retail Store Image, Journal Of Product And Brand Management, vol 6 no 6, 1997 pp 373-387, MCB UNIVERSITY PRESS, 1061-0421 Marguerite Moore and Jason Carpenter, the effect of price as a marketplace cue on retail patronage, Journal of Product and Brand Management, 15/4 (2006) 265-271, Emerald Group Publishing Limited (ISSN1061- 0421) WEBSITE IBM Global Services, Route 100, Somers, NY 10589, U.S.A. (Retrieved on 2 FEBRUARY 2010) From:http://www-935.ibm.com/services/id/igs/pdf/g510-1731-00-esr-vision-in-the-retailindustry.pdf (Retrieved on 2 FEBRUARY 2010) marketing.about.com/od/marketingglossary/g/brandimagedef.htm (Retrieved on 5 MARCH 2010) http://www.customerservicemanager.com/definition-of-customer-service.htm (Retrieved on 5 MARCH 2010)

http://en.wikipedia.org/wiki/Supermarket http://en.wikipedia.org/wiki/Hypermarket http://en.wikipedia.org/wiki/Convenience_store http://en.wikipedia.org/wiki/Department_store BOOK

(retrieved on 20 MARCH 2010) (retrieved on 20 MARCH 2010) (retrieved on 20 MARCH 2010) (retrieved on 20 MARCH 2101)

Barry Berman & Joel R.Evans, (2006). Retail management: a strategic approach (Pearson Education, Inc., Upper Saddle River, New Jessy, 07458) Sekaran, U. (2005). Research Methods for Business, A Skill-Building Approach (4 th Edition). New York: John Wiley& Sons, Inc Zikmund, W.G. (2003). Business Research Methods. Ohio: Thomson South-Western. Dunne & Lusch (2008). Retailing, International Student Edition (6th Edition). Barry Berman and Joel R. Evans (2007). Retail Management, A Strategic Approach (10th Edition). Leon G. Schiffman and Leslie Lazar Kanuk (2007). Consumer Behavior (9th Edition).

APPENDICES

APPENDIX 1 QUESTIONNAIRE

TITLE: FACTORS THAT INFLUENCE CUSTOMERS PERCEPTION ON RETAIL STORE IMAGE

Project Reserach Disember 2009 April 2010

Assalamualaikum w.b.t and Selamat Sejahtera

I am student of BBA (Hons) Retail Management Mara University of Technology Shah Alam, in Subject Practical Report want to research about Factors That Influence Customers Perception on Retail Store Image.

As we know, nowadays there are a lot of retail store outlets out there. So these outlets will compete each other to get a customer. How they attract the customers to come and enter into the store and make the customer have a good perception towards their store.

INSTRUCTION: These questions have five (6) parts, Parts A, Part B, Part C, Part D, Part E and Part F. You must follow the instruction given in each part.

PART A (BRAND IMAGE) State the extent to which you agree with each of the following statements

1 Strongly Disagree

2 Disagree

3 Natural

4 Agree

5 Strongly Agree

A1. The product brand image satisfy your need A2. The product brand image provide a quality. A3. The product brand image provide a uniqueness. A4. The product brand image provide a good image. A5. Retailer provide varieties of product brand image.

PART B (SOCIAL CUES-CUSTOMER SERVICE)

B6. The services given are satisfy your need. B7. Retailer understand on the customers . need and wants

B8. Retailer is friendly conversation and politely B9. Retailer willingness to help and solve customer problem B10. Retailer is serve very patiently . PART C (STORE ATMOSPHERE)

C11. Retailer provide attractive store atmosphere C12. Retailer provide uniqueness store atmosphere C13. Retailer provide comfortable store atmosphere C14. Retailer provide effective store atmosphere C15. Retailer provide effecient store atmosphere C16. Retailer provide condusive store atmosphere

PART D (PRICE)

D17. You are satisfied with the price given in retail outlet? D18. The price is reasonable D19.The price is affordable for each income D20.The price is suitable with the quality of the product D21. The price is the main factor for you to buy something from retail outlet

1 1

2 2

3 3

4 4

5 5

PART E (RETAIL STORE IMAGE)

E22. The brand image is the main factor for you to shop at retail store E23. The customer service is the main factor for you to shop at retail store E24. The store atmosphere is the main factor for you to shop at retail store E25. The price is the main factor for you to shop at retail store

PART F (DEMOGHRAPHIC)

E21. Gender :

Male

Female

E22. Age :

20 30 year 41 50 year

31 40 year 51 and above

E23. Status :

Single

Married

E24. Occupation :

Student Private

Government Others :

End question.

Thank You For Your Cooperation. Have a Nice Day