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Quality of Electronic Services: Conceptualizing and Testing a Hierarchical Model

Martin Fassnacht and Ibrahim Koese
Journal of Service Research 2006 9: 19
DOI: 10.1177/1094670506289531

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Quality of Electronic Services
Conceptualizing and Testing a Hierarchical Model
Martin Fassnacht
Ibrahim Koese
WHU Otto Beishim School of Management
For providers of electronic services, quality is a major dri-
ving force on the route to long-term success. Comprehen-
sive measurement of quality, in turn, is the key to effective
quality management. Marketing academia has just started
to attend to quality measurement in the context of elec-
tronic services. A review of existing literature on the
subject reveals that important research gaps exist, both
conceptually and methodologically. Building on extant
research and findings from a qualitative study, the authors
develop a broadly applicable, hierarchical quality model
for electronic services, which includes three dimensions
and nine subdimensions. The proposed model is rigorously
tested by means of a large aggregated sample drawn from
the customer bases of three different electronic services.
The authors find support for the conceptualization and dis-
cuss important findings of the study as well as implications
for managerial practice and research.
Keywords: electronic services; Internet; quality mea-
surement; empirical study
Electronic services have recently received consider-
able attention in academic research. Rust (2001) defined
the concept as the provision of service over electronic
networks (p. 283). He located it at the intersection of
two major developments in the business world: the grow-
ing importance of services and the increasing acceptance
The authors thank the editor and two anonymous reviewers for their constructive feedback during the review process. They also
thank Ellen Roemer for helpful comments on an earlier version of this article.
Journal of Service Research, Volume 9, No. 1, August 2006 19-37
DOI: 10.1177/1094670506289531
2006 Sage Publications
Downloaded from jsr.sagepub.com at UNIV OF CHICAGO LIBRARY on May 19, 2014
of information and communication technology as an
exchange medium, most notably the Internet. Indeed,
contributions to research on electronic services mainly
originate from the fields of services marketing (e.g.,
Janda, Trocchia, and Gwinner 2002) and electronic com-
merce (e.g., Sultan et al. 2002), as well as information
systems research (e.g., Aladwani and Palvia 2002), and
they tend to be multidisciplinary.
Akin to research on traditional services,1 the conceptual-
ization and measurement of quality is a major issue on the
research agenda for electronic services (Bitner 2001;
Grove, Fisk, and John 2003; Parasuraman and Zinkhan
2002). There is ample evidence that service quality delivery
has a positive impact on desired attitudinal, behavioral, and
financial outcomes (Cronin, Brady, and Hult 2000; Rust,
Moorman, and Dickson 2000). In the context of electronic
services, researchers have even argued that quality may be
the most important determinant of long-term success
(Santos 2003; Zeithaml, Parasuraman, and Malhotra 2000,
2002). Because more and more consumers are making use
of the possibilities offered by the Internet, the novelty of
electronic services wears off, and consumers are less will-
ing to tolerate poor service quality. Furthermore, transpar-
ency of prices is relatively high, and competing service
providers are often just one click away from each other.
Thus, consistent delivery of high service quality becomes a
primary source of competitive advantage, underlining the
managerial importance of the subject at hand.
20 JOURNAL OF SERVICE RESEARCH / August 2006
For service providers, comprehensive measurement
is the key to effective quality management. In the context
of electronic services, internal quality measures such as
server response time or clickstream data are readily avail-
able. Such data may offer insights into the technical part
of the service quality delivered, for example, by provid-
ing the average number of mouse clicks that customers
make on the Web site in order to register with the service
provider. However, insights gained from these kinds of
measures tend to be limited, because they do not ade-
quately reflect customer perceptions. For instance, a cer-
tain average number of mouse clicks that customers have
to make during the usage of an electronic service might
or might not be annoying for them. Thus, the picture will
remain incomplete or at best blurred without assessing
service quality from the customers point of view. In
addition, the Internet as a new service environment and
the self-service character of the concept strongly imply
that a mere transfer of traditional measures will not ade-
quately capture the quality of electronic services (QES).
Clearly, specific research is needed. Although several
studies on the topic have already been published, impor-
tant research gaps remain, especially concerning the scope
of quality dimensions included.
In this article, we aim to develop and empirically test
a conceptualization that offers a more complete under-
standing of QES than in previous studies. We intend to
achieve this by taking a more comprehensive view of
the outcome dimension of QES. Another major objec-
tive is to develop a measurement scale that is applicable
to a broad range of electronic service offerings rather
than one specific area. Such a scale will be especially
suited for service providers with multiple offerings who
would like to compare how QES is perceived across dif-
ferent settings. Some authors argue that scales for mea-
suring QES will have to vary in different contexts, as
the benefits sought from an electronic service also
depend on the context (e.g., Parasuraman, Zeithaml, and
Malhotra 2005). For example, online shopping differs
from online newspapers. However, we believe that,
despite possible differences, there are aspects of service
quality that have to be taken into account regardless of
the context.
Bearing these two major research aims in mind, we
find it useful to draw on the framework for service qual-
ity introduced by Rust and Oliver (1994) as a theoretical
reference. We believe that the use of this framework helps
to gain a more comprehensive view on QES: It enables us
to integrate findings from previous research as well as to
add outcome facets of QES that have been more or less
ignored so far. The framework is also helpful in develop-
ing a broadly applicable model, because the service qual-
ity dimensions it proposes are germane to all kinds of
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electronic services. Parasuraman and Zinkhan (2002)
emphasized that there is a need for more theory-based
research in the context of the Internet in general. By
adopting the Rust and Oliver (1994) framework, we
intend to take a step toward filling this research gap.
Finally, we aim to contribute to the current research in
methodological terms by rigorously testing the proposed
quality model. Our sample covers three different electro-
nic services: a service for the creation and maintenance
of personal homepages, a sports coverage service, and an
online shop. This increases the generalizability of our
results across different areas of investigation.
Furthermore, the sample consists of registered customers
of a service provider. This addresses a limitation of extant
research, because samples from a service providers
actual customer base are rarely found. In two of the three
areas of investigation, the sampling frame even com-
prises customers who pay for the service on a subscrip-
tion basis. Thus, external validity of results is likely to be
higher than in most previous studies.
This article is structured as follows: We first present a
review of the literature, advance a definition of electronic
services as the reference object of quality, and delineate
the domain of QES. Drawing on insights from the exist-
ing literature and the results of a qualitative study, we
then elaborate our conceptualization of QES. Next, we
describe the research methodology employed and present
our results. The article concludes with a discussion in
which we point to managerial implications of the present
study as well as directions for future research.
CONCEPTUAL BACKGROUND
Literature Review
A growing body of literature has been dealing with
QES. Zeithaml, Parasuraman, and Malhotra (2002) syn-
thesized early contributions to the field. They found,
among other things, that QES is a multidimensional con-
struct. However, the authors remarked that no consensus
on the relevant dimensions had been reached and that the
various dimensions proposed would have to be investi-
gated more systematically. They concluded that extant
knowledge on QES is rather limited and that thorough
academic research on this topic is needed. Recently, more
studies have been published. Even though these studies
show that rigorous research on the topic has started to
emerge, various shortcomings remain. Table 1 gives an
overview of selected articles that have been published
since 2002. At large, these articles may be regarded as
representative of the current research on QES. We will go
through each column of Table 1 in order to point out the
 Fassnacht, Koese / ELECTRONIC SERVICES 21

TABLE 1
Studies Representative of Previous Research and Identified Gaps
Domain of Dimensions Scope of Theoretical
Studya the Measure (subdimensions) Application Referenceb Samplec

Collier and Service quality Process quality (privacy, design, Online shopping Model of logistics None (conceptual
Bienstock (2003) information accuracy, ease of service quality article)
use, functionality), outcome by Mentzer,
quality (order timeliness, order Flint, and Hult
accuracy, order condition), (2001)
recovery quality (interactive
fairness, procedural fairness,
outcome fairness)
Gounaris and Service quality Customer care and risk reduction Portal sites (SERVQUAL) Customers of three
Dimitriadis (2003) benefit, information benefit, Internet service
interaction facilitation benefit providers
Gummerus et al. Service quality User interface, responsiveness, Content-based None Visitors of an online
(2004) need fulfillment, security Web sites health care portal
(Web site intercept
survey)
Janda, Trocchia, and Service quality Performance, access, security, Online shopping None Internet users with
Gwinner (2002) sensation, information a recent online
(IRSQ) purchase
Loiacono, Website quality Usefulness (informational fit-to- Basically all kinds (Technology Students
Watson, and task, interactivity, trust, of Web sites, but Acceptance
Goodhue (2002) response time), ease of use no explicit Model)
(WebQual) (ease of understanding, intuitive reference to
operations), entertainment service delivery
(visual appeal, innovativeness,
flow), complementary relation-
ship (consistent image, online
completeness, better than
alternative channels)
Parasuraman, Service quality Efficiency, system availability, Online shopping (Means-end Internet users with
Zeithaml, and fulfillment, privacy framework) online shopping
Malhotra (2005) experience at
(E-S-QUAL) Amazon.com/
Walmart.com
Wolfinbarger and Service quality Web site design, fulfillment/ Online shopping None Members of Harris
Gilly (2003) reliability, security/privacy, Poll Online Panel
(eTailQ) customer service

Research gaps Clear-cut definiton More complete consideration of Development and Theory-based Random sampling
of electronic outcome facets and their test of a scale conceptualiza- from actual
services as a empirical examination in that is applica- tions of QES customer base
reference object the context of QES ble across dif- that allow for (ideally paying
ferent electronic testing customers)
service offerings prespecified
models

NOTE: IRSQ = Internet retail service quality; QES = quality of electronic services.
a. Listed alphabetically by first author.
b. Entries in this column in parentheses denote that a theoretical reference is given, but not reflected in the structure of the developed measure.
c. To simplify matters, this refers only to the sample used for the confirmatory analysis in each study.

contributions made so far and to identify research gaps
that we address in the current study.
As Wolfinbarger and Gilly (2003) have stated, early
studies on QES often focused on the quality of the user
interface itself, that is, Web site quality. The developed
scales had little in common. Table 1 shows that recent
studies go beyond the measurement of mere Web site
quality and try to capture the domain of QES more fully
by adding important facets such as order fulfillment.
However, it should be noted that most authors neither
define the exact domain of their quality construct nor
provide a clear-cut definition of electronic services.

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22 JOURNAL OF SERVICE RESEARCH / August 2006
Therefore, it will be important to explicitly define both
electronic services and QES in order to give a clear pic-
ture of what we are examining in this study.
Because of a lack of clear definitions, a comparison
and integration of existing research findings is difficult at
times. Dimensions and subdimensions of QES proposed
in one article may not always be compared with those of
another study. For instance, Gummerus et al. (2004) dis-
cussed the quality dimension of responsiveness in terms of
the response to customer feedback, whereas in the work of
Loiacono, Watson, and Goodhue (2002), this dimension
refers to the loading time of Web sites. Nevertheless, the
studies listed in Table 1 indicate some overlap with regard
to the proposed dimensions. For example, dimensions such
as design, ease of use, or information quality recur consis-
tently and should therefore be adequately integrated into
the present study.
However, a closer look at Table 1 also reveals that most
scholarly work on the topic develops a more or less limited
set of dimensions in order to capture QES. In particular,
researchers tend to concentrate on the service delivery
process, whereas outcome dimensions of quality are not
comprehensively addressed. By and large, reliability is the
only outcome facet considered in existing studies.
Researchers have already raised similar criticism in the
context of measuring quality for traditional services
(Smith 1999). The service outcome is usually defined as
what the customer is left with after service delivery.
Collier and Bienstock (2003) recognized that it play[s]
an incredibly influential role for QES. Their article is the
only one that explicitly discusses a dimension labeled
outcome quality (p. 160). Yet the corresponding
subdimensions mainly cover facets associated with relia-
bility. Moreover, their model has not been tested empiri-
cally so far. Parasuraman, Zeithaml, and Malhotra (2005)
mentioned hedonic benefits but consider them to be out-
side the conceptual domain of service quality, as they may
not be relevant to all contexts. Gummerus et al. (2004)
were the first to include a benefit dimension called need
fulfillment in an empirical study on QES. However, their
operationalization of this construct remains ambiguous,
and their model is merely tested with data taken from a
self-selected sample. Obviously, the lack of articles that
thoroughly investigate outcome facets of QES is a signif-
icant limitation of the research conducted so far.
Another major research gap becomes apparent when
we look at the scope of application for existing scales. Up
to now, authors have largely focused on online shopping
as the area of interest (e.g., Janda, Trocchia, and Gwinner
2002; Parasuraman, Zeithaml, and Malhotra 2005;
Wolfinbarger and Gilly 2003). Comparatively little
research has been done on other kinds of electronic
services. Gounaris and Dimitriadis (2003) investigated
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the quality of business-to-consumer portals, which they
characterized as pure information content services.
Gummerus et al. (2004) focused on a health care portal.
To the best of our knowledge, no study has so far devel-
oped and empirically tested a measurement scale for
QES on the basis of data from multiple settings.
Although existing scales might well be transferred to dif-
ferent electronic service offerings, there is no empirical
evidence to date that they are indeed applicable across
different kinds of electronic services such as online shop-
ping, Web hosting, or content-based services.
Furthermore, previous research has often taken an
exploratory, data-driven approach in developing the
respective quality model. Thus, the structure and mean-
ing of the elaborated dimensions have largely been deter-
mined ex post by results from data analysis. A theoretical
reference has rarely been used. Some authors mention a
specific theory or concept at the outset of their model
development, but it is not reflected in the dimensionality
of their scale (Gounaris and Dimitriadis 2003; Loiacono,
Watson, and Goodhue 2002). Parasuraman, Zeithaml,
and Malhotra (2005) drew on a means-end framework for
understanding the domain and consequences of QES. Yet,
their framework aims at embedding QES into a nomolog-
ical net (p. 218) and not at specifying the dimensional-
ity of their scale. Collier and Bienstock (2003) stringently
derived their conceptualization of QES from a model of
logistics service quality, but, as already mentioned,
empirical support for their approach is lacking. All in all,
there should be more studies that draw on a theoretical
reference in developing conceptualizations of QES. This
would make it possible to test a prespecified model struc-
ture and thereby help in advancing the study of QES from
exploratory to confirmatory approaches.
Finally, a look at the last column of Table 1 illustrates
which kinds of samples were used in previous studies.
Obviously, many authors resort to either convenience
samples (mainly students) or self-selected samples. The
latter are produced, for instance, through intercept sur-
veys where all visitors of a Web site in a given time frame
are asked to participate regardless of being regular
users/customers (Gummerus et al. 2004). Similarly, self-
selection occurs when respondents are selected on the
basis of their answer to a screening question rather than
through random sampling (e.g., Janda, Trocchia, and
Gwinner 2002). It is surprising that even very thorough
studies like those of Parasuraman, Zeithaml, and
Malhotra (2005) or Wolfinbarger and Gilly (2003) do not
use samples drawn from the actual customer base of
a service provider. This important limitation of extant
research certainly needs to be addressed.
On the basis of a synthesis of existing literature on
QES, we have identified several research gaps that offer

considerable potential for significant contributions to the
advancement of knowledge on QES (see last row of Table
1). Given the importance of the subject in theory and prac-
tice, we believe that these research gaps deserve attention.
Defining the Reference Object of Quality
Up to now, a generally accepted definition of elec-
tronic services has not emerged in the literature. Existing
definitions are, however, similar in one aspect: They focus
on services provided over the Internet, which is, by itself,
a rather broad definition. At the same time, the scope of the
quality construct that is studied differs from article to arti-
cle. There are studies that focus on Web site quality alone
(e.g., Loiacono, Watson, and Goodhue 2002), whereas
other studies take a more extended view on QES that
includes, for example, contacts with customer service
agents (e.g., Yang, Peterson, and Cai 2003). Moreover, the
research published so far covers different kinds of elec-
tronic services, for example, online shopping, electronic
banking, or information services, but hardly any state-
ments are found on the generalizability of these individual
findings. Against this backdrop, it is necessary to first
define electronic services in general and then to clearly
point out which kind(s) of electronic services are investi-
gated. Thus, we aim to precisely describe the reference
object of the quality construct within our study.
A review of relevant literature reveals a diversity of
definitions. To clearly delineate our understanding of the
concept, we define electronic services as services deliv-
ered via information and communication technology where
the customer interacts solely with an appropriate user
interface (e.g., automated teller machine or Web site) in
order to retrieve desired benefits. Looking at this defini-
tion, two things become apparent: First, it is close to the
above cited definition of Rust (2001), because it basically
includes all kinds of electronic networks, not only the
Internet, and thus captures electronic services in the
broader sense. Second, we emphasize the pure self-service
character of the concept. This implies that, in our view,
electronic services as such do not include customer-
employee interaction of any kind. In general, this phe-
nomenon is referred to as technology-based self-service
(e.g., Dabholkar and Bagozzi 2002; Meuter et al. 2000).
For instance, an employees answer to a customers e-mail
request is not part of our definition, because it represents
an electronically mediated personal service encounter and
is thus distinct from the electronic service itself.
In the current context, a technology-based self-service
represents the core offering, that is, the offering that deliv-
ers the benefits customers seek. Naturally, this service is
designed to be used by customers without any assistance
from employees. Otherwise, it would not make sense to set
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Fassnacht, Koese / ELECTRONIC SERVICES 23
up such a service. However, customers will not use this
offering repeatedly if they are not positive about it. There-
fore, it is of utmost importance for the service provider to
deliver a high-quality core offering (electronic service as
defined above) in the first place. From the customers point
of view, this is the crucial, and in many cases the only,
encounter. Thus, we have focused our study on this core
offering in order to have a clear-cut reference object for the
quality construct that is investigated. Our approach avoids
the conceptual overlaps inherent in many previous studies,
which mix up electronic service elements with people-
based service elements (e.g., Wolfinbarger and Gilly 2003;
Yang, Peterson, and Cai 2003).
We do not contend that, in practice, people-based
service elements may be completely ignored in the con-
text of electronic services. But service options such as call
center agents or personnel for e-mail communication do
not become relevant unless some kind of service failure
occurs and recovery is needed. Of course, service
providers should take that into consideration, but their
focus has to be on the core offering. A high-quality elec-
tronic service is always essential. Recovery might be
needed in some situations, but it is not wanted in the first
place. The study of McCollough, Berry, and Yadav (2000)
supports this view: They observe that recovery is not an
opportunity when compared to . . . error-free service
delivery (p. 133). Therefore, it should be treated as a sep-
arate construct. This is also strongly supported by
Parasuraman, Zeithaml, and Malhotras (2005) findings.
They propose a different scale (E-RecS-QUAL) for the
portion of customers with recovery experience. Moreover,
there is a separate stream of literature dealing with service
recovery issues, recently also within the online context
(Holloway and Beatty 2003). Collier and Bienstocks
(2003) conceptualization of QES actually includes a
three-dimensional recovery construct, which they have
borrowed from traditional service recovery research.
Taken together, it becomes evident that including people-
based service elements would hardly make any contribu-
tion over and above existing literature on service recovery.
To further clarify our definition, Figure 1 shows a broad
classification of electronic services along two dimensions:
the standing of the service from the customers point of
view and the type of user interface. With regard to the
standing of the service, we distinguish between stand-
alone services and supporting services. In the first case, the
electronic service provided is at the same time the main
benefit for the customer. In the latter case, the electronic
service essentially facilitates the use of a traditional service
or the purchase of goods. As far as the stand-alone services
are concerned, a further distinction between content offers
and pure service offers is helpful (see Figure 1 for exam-
ples). Regarding the type of user interface, we distinguish
24 JOURNAL OF SERVICE RESEARCH / August 2006
FIGURE 1
Classification of Electronic Services
Internet (esp. WWW)
Content offers, e.g.:
News and sports coverage
Video-on-demand
E-learning
Stand-alone Service Pure service offers, e.g.:
Online banking
Web hosting and e-mail
Price comparison agent
Web organizer
Standing of the Service From
Customers Point of View Examples:
Timetable information and ticketing
on web site of an air carrier
Supporting Service Online bookstore and all other kinds
of online shopping
Online reservation of cinema tickets
between the Internet (World Wide Web, above all) and
other options such as voice-operated systems, television,
or special terminals (e.g., automated teller machines).
In our study, we focus on the left-hand side of the
matrix in Figure 1. We believe that it is reasonable to con-
centrate on the most important interface, as we are still in
the early stages of this field of research. Moreover, we
think that the knowledge from research in Internet-based
contexts can essentially be applied to other graphic user
interfaces such as mobile phones or interactive television.
The Internet has nowadays become the principal interface
for electronic services, making it the preferred area of
investigation in the literature published so far. At this point,
it should however be noted that our study is not concerned
with all the various purposes that the Internet may serve in
general. Rather, we want to examine commercial service
delivery through the Internet, where customers directly
(e.g., for downloading content) or indirectly (e.g., through
products ordered) pay for the service they receive. In fact,
these are the electronic services for which quality matters
the most. Paying customers naturally expect to receive
high service quality. We thus align our investigation of
QES with the existing scholarly work that has also con-
centrated on the delivery of electronic services via the
Internet. An important extension, however, is that we
examine stand-alone services (both content and pure
service offers) as well as supporting services, which
addresses a major gap in extant research (Parasuraman,
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Type of User Interface
Other
Examples:
Automated teller machines
Location-based services for mobile
phones
Pay-per-view via TV
Telephone banking
Examples:
Self-check-in terminal at airport
Mobile payment services (e.g., paybox)
Voice-operated reservation system for
cinema tickets
Self-checkout cash desk in
supermarkets
Zeithaml, and Malhotra 2005). This approach is also con-
sistent with our goal of developing a broadly applicable
measurement scale for QES.
Defining QES
To the best of our knowledge, Zeithaml, Parasuraman,
and Malhotra (2000) were the first authors who provided a
formal definition of QES: the extent to which a website
facilitates efficient and effective shopping, purchasing, and
delivery (p. 11).2 In fact, hardly any other definitions of
QES can be found in the literature. Zeithaml, Parasuraman,
and Malhotras (2000) definition refers to the ability of an
online retailers Web site to fulfill the customer need of
trouble-free shopping. Such a notion of quality is consis-
tent with basic approaches to defining the concept (Oliver
1997). However, there are two reasons why the present
definition might be unsuitable for our purposes: First, we
agree with Gummerus et al. (2004) who stated that the
definition of Zeithaml, Parasuraman, and Malhotra is too
narrow, because it focuses on online shopping. Second, the
Web site is specified as the reference object of quality,
although the authors take a comprehensive view on QES.
This may lead to confusion, given the existence of specific
research devoted to Web site quality alone. Of course, the
Web site is very important as it represents the front end of
the electronic service. But QES has to encompass more
than the Web site. Technical infrastructure and back-end

processes, for instance, are also important, especially when
it comes to fulfillment of the service promise.
What may indeed be borrowed from the present defi-
nition are the notions of effectiveness and efficiency,
which bring to mind that not only the process of service
delivery has to be considered (efficiency) but also the
outcome (effectiveness). On the basis of these insights
and in view of our aim to capture the domain in a broader
sense, we define QES as the degree to which an elec-
tronic service (as defined above) is able to effectively and
efficiently fulfill relevant customer needs.
QES differs from traditional service quality in two
important ways. First, there is the self-service character of
electronic services: In using the service, customers merely
interact with a technical interface, leading to a pure
person-to-technology service encounter. Thus, customers
play a much more active role as coproducers as compared
to traditional services. In fact, they significantly con-
tribute to the outcome of service delivery. They even tend
to take some of the responsibility when things go wrong
(Meuter et al. 2000). In a traditional setting, however,
services are delivered by people, representing an interper-
sonal service encounter with the outcome depending for
the most part on the performance of service personnel.
Second, the service environment is largely created by spe-
cific design features of the graphic user interface (Rust
and Kannan 2002). In the present study, it is the service
environment created on the Internet. Apparently, it is a
completely different environment compared to traditional
services. It becomes clear that existing quality measures,
designed to assess the quality of services delivered by
people, will not be capable of adequately capturing QES.
Certainly, there will be similarities between traditional
measures and those for QES. Yet it is beyond doubt that
important differences will come up.
Model Development
Initially, we briefly outline the service quality frame-
work proposed by Rust and Oliver (1994), which serves
as a theoretical reference for our conceptualization.
According to this framework, three dimensions of service
quality have to be considered: service environment,
service delivery, and service product. In a traditional
service setting, service environment relates to the physi-
cal ambiance of the service encounter, or the socalled ser-
vicescape. Service delivery is viewed as the process of
interaction between employees and customers. And
service product is the core benefit that customers receive
after service delivery, that is, the outcome of the service
exchange. As Rust and Kannan (2002) have shown, these
three dimensions are also applicable to electronic services:
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Fassnacht, Koese / ELECTRONIC SERVICES 25
The appearance of the user interface on the Web site
represents the service environment. Service delivery is
characterized by the interaction of the customer with the
user interface during service usage. Finally, service prod-
uct as an outcome dimension may also be applied to elec-
tronic services. This clearly indicates that the framework
is suitable for our purposes.
Evidence suggests that service quality dimensions
should be viewed as higher-order constructs that have var-
ious subdimensions (Carman 1990; Dabholkar, Thorpe,
and Rentz 1996). In combination with the Rust and Oliver
(1994) framework, this results in the notion of service
quality as a three-dimensional, hierarchical construct. In
this context, hierarchical means that the subdimensions
are treated as first-order factors and the dimensions as
second-order factors of the service quality construct. In
their elaborate study, Brady and Cronin (2001) provided
compelling empirical evidence for a similar conceptual-
ization. We adopt the view of a hierarchical construct
with the three dimensions environment quality, delivery
quality, and outcome quality as a basis for our conceptu-
alization of QES. In doing so, we go beyond previous
research, in which only a simple first-order structure of
QES has been tested so far. We believe that the introduc-
tion of environment, delivery, and outcome quality as
second-order factors is conceptually appealing, because
it represents a first step toward a better understanding of
the associations between the various subdimensions
(first-order factors) of QES. To elaborate the relevant
subdimensions of the construct, we draw on two sources:
findings from existing literature and the results of a qual-
itative study involving explorative interviews.
To get a comprehensive overview of the existing litera-
ture, we searched for publications dealing with QES in its
broadest sense. We also considered articles pertaining to
quality or satisfaction with Web sites as well as articles on
self-service technologies. We included conceptual as well
as empirical work. The search yielded a total of 45 publi-
cations3 originating from the fields of services marketing,
electronic commerce, and information systems research.
We scrutinized each of them and extracted the subdimen-
sions that each publication put forward. In doing so, we did
not just look for the denotation of proposed subdimensions
but focused on the meaning of the constructs as provided
by definitions and respective measures (where available).
Our analysis showed considerable overlap with respect to
the proposed subdimensions. In particular, the following
subdimensions recurred consistently: ease of use, quality
of appearance/layout, information quality, privacy/
security, reliability, speed/responsiveness, and content. In
our view, this indicates the existence of a basic set of sub-
dimensions that researchers should take into account when
considering QES. A similar view is held by Zeithaml,
26 JOURNAL OF SERVICE RESEARCH / August 2006
Parasuraman, and Malhotra (2000), who stated that con-
sumers use basically similar dimensions in evaluating
e-SQ [electronic service quality] regardless of the type of
product or service being evaluated on the Internet (p. 15).
As mentioned before, a noticeable fact is that research has
largely focused on the delivery process. The outcome
facets of service quality have not been fully examined yet.
In addition to the findings from the existing literature,
we had the opportunity to study a report on the results of a
qualitative study involving explorative interviews. These
took place 3 months prior to our research cooperation with
the service provider. Supported by a market research firm
specialized in explorative studies in the online context, our
cooperation partner conducted 24 in-depth interviews with
users of different electronic services. Nine participants
were female, 15 were male; in age, they ranged from 19 to
63 years. Twelve participants were registered customers of
services provided by our cooperation partner, whereas the
other 12 were customers of competing firms. The partici-
pants Internet experience (1 year to 10 years) and also their
intensity of Internet usage (a few hours per week to 5 hours
per day) varied substantially. All participants were asked
the same open-ended questions about their experiences
with the respective service. The questions covered a variety
of aspects, for example, the visual attractiveness of the Web
site, ease of navigation or adequacy of the available infor-
mation. Furthermore, participants were asked to use the
service in the course of the interview with technical settings
as in their regular usage environment in order to reveal
important aspects of user experience that were not articu-
lated. All interviews were videotaped and analyzed by the
market research firm.
Although we were not involved in the qualitative study,
we had access to a final report summarizing the conducted
interviews. We synthesized the results presented in this
report and found that all of the above-mentioned subdi-
mensions were reflected in the interviews. However, it was
interesting to see that the issue of privacy and security was
only raised a few times and did not seem to play a crucial
role in preferring a particular service offering. A few par-
ticipants even conceded that they were not able to really
judge the security granted, because the issue was too tech-
nical for them. In addition to those subdimensions regularly
found in the literature, participants ascribed relatively high
importance to the usefulness and emotional value of
services. This emphasizes the relevance of the outcome
dimension from the customers point of view.
Built on insights from the extant literature, the results of
the qualitative study, and the theoretical reference described
above, we suggest a conceptualization of QES with nine
subdimensions as first-order factors and three dimensions
as second-order factors (see Figure 2). In the follow-
ing paragraphs, we further develop our conceptualization,
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taking previous research into account as well as adding
illustrative quotes from the qualitative study to support our
reasoning.
As the dimension environment quality is related to the
appearance of the user interface, two corresponding subdi-
mensions are assigned to it: Graphic quality captures how
well the various elements of the user interface (e.g., text,
icons, digital images, or backgrounds) are visually repre-
sented, whereas clarity of layout is defined as the degree to
which the design structure of the user interface helps users
to find their way. Some authors consider these two subdi-
mensions to be facets of one construct (e.g., Collier and
Bienstock 2003), whereas others distinguish between the
two (e.g., Montoya-Weiss, Voss, and Grewal 2003). Both
factors have frequently been mentioned in the interviews.
Moreover, the interviews indicated that graphic quality and
clarity of layout should be considered as separate subdi-
mensions. Interviewees talked about layout aspects (Too
many things displayed at once) without making a direct
connection to the visual representation of the user interface
(Fresh and friendly colors; I like it).
Delivery quality pertains to the customerWeb site
interaction during service usage, that is, it includes
aspects that are relevant for the customers when they are
looking for information, selecting from available options
or carrying out transactions. Thus, we assign four related
subdimensions to delivery quality that are regularly found
in the literature and have also frequently been mentioned
in the qualitative study. The first, attractiveness of selec-
tion, is defined as the extent to which the available range
of offerings appeals to the customer. It mirrors the sub-
dimension of content found in many studies (e.g.,
Aladwani and Palvia 2002) and has also been an impor-
tant facet in the qualitative study (It is important to have
a comprehensive range of offerings to choose from). Our
definition is at a rather abstract level in order to make the
construct broadly applicable. Clearly, the range of offer-
ings depends on the area under investigation. In case of an
Internet banking service, for example, it would refer to the
selection of banking services offered, whereas in the con-
text of an online shop it would refer to the selection of
products and related services.
Information quality covers the extent to which com-
plete, accurate, and timely information is provided for the
customer during the interaction process with the user inter-
face (e.g., product descriptions, payment information, or
frequently asked questions). Ease of use is defined as the
degree to which the functionality of the user interface
facilitates the customers retrieval of the electronic service.
Both subdimensions are clearly related to the service deliv-
ery process and have frequently been proposed in previous
research, pointing to a high importance within the scope
of QES. This has been supported to a great extent by the

FIGURE 2
Quality of Electronic Services: Conceptual Model
Quality of
Electronic Services
Environment
Quality
Graphic Clarity of
Quality Layout
Attractiveness Information
of Selection Quality
repeated occurrence of interviewee statements like I get
more information than in a regular shop, or I need to
make too many clicks, thats a nuisance.
The fourth subdimension, technical quality, captures the
goodness of data transfer and data processing during the
delivery of the electronic service. It subsumes several tech-
nical elements of the delivery process, which in our opinion
belong together but are found in two different quality dimen-
sions in the literature: speed/responsiveness and privacy/
security. Only the technical aspects of speed/responsiveness
(e.g., 24/7 access to the Web site, short loading times) are
consistent with our definition of electronic services and are
therefore included. When examining the literature, we find
that privacy/security often carries the notion of trust in the
service provider. Yet trust is a construct of its own, that is,
the customers attitude toward the service provider, rather
than a characteristic of the service itself. Consequently, it
cannot be an element of the quality of that service. Yet
there is also a technical feature pertaining to privacy/
security that has to be included in this subdimension: secu-
rity of data transfer, for example, in the course of the log-
on to an electronic service or while transmitting payment
information. Overall, the rare occurrence of remarks in the
qualitative study that concern privacy/security seems to
support our rationale.
We have already pointed out that previous research on
QES has often been process oriented. Although existing
scales like eTailQ or E-S-QUAL incorporate reliability/
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Fassnacht, Koese / ELECTRONIC SERVICES 27
Delivery Outcome
Quality Quality
Functional Emotional
Reliability
Benefit Benefit
Ease of Technical
Use Quality
fulfillment, which represents an important facet of outcome
quality, few studies have empirically examined other
relevant facets like usefulness (Loiacono, Watson, and
Goodhue 2002) or emotional value (Nacif 2003). The the-
oretical framework we refer to calls for a fuller considera-
tion of service outcome facets and thus helps in addressing
this research gap.
In our model, outcome quality is viewed as what the
customer is left with after service delivery. It is repre-
sented by three subdimensions. The first, reliability, is
defined as the extent to which the provider keeps its
service promise. It is important to note that this subdi-
mension does not refer to the reliable functioning of the
providers technical infrastructure during service deliv-
ery. That aspect is already covered by technical quality.
Rather, reliability refers to the accuracy and timeliness
with which the underlying service promise is fulfilled. It
can therefore only be judged after service delivery, which
makes it a facet of outcome quality. Although there is
wide consensus in the literature on the importance of reli-
ability within the scope of QES, explicit discussion of it
as an element of outcome quality is scant.
As second and third subdimensions, we are including
functional benefit and emotional benefit. Functional bene-
fit is defined as the extent to which the service serves its
actual purpose. Emotional benefit is the degree to which
using the service arouses positive feelings. We do not use
the term value in this context to avoid possible confusion
28 JOURNAL OF SERVICE RESEARCH / August 2006
with the term perceived value, a consideration of benefits
and costs for the customer (Zeithaml 1988). The results of
the interviews strongly support the inclusion of the two
benefit constructs: Statements such as It does its job, and
it is convenient or It is a nice gadget, but you do not
really need it stress the relevance of functional benefit.
Likewise, many interviewees remarked that it speaks in
favor of an electronic service when they enjoy using it.
They found themselves spending more time on the site
than they had originally wanted. Also, considerable theore-
tical support exists for the importance of functional and
emotional benefit. Sheth, Newman, and Gross (1991) pro-
posed that every buying decision is determined by a mix-
ture of several benefit dimensions and that these dimen-
sions may have varying importance depending on the situ-
ation. According to these authors, functional benefit is the
most important dimension. This is also in line with a rich
stream of research on technology acceptance that was ini-
tiated by Davis (1989). Most studies in this research area
found that usefulness plays the decisive role in developing
a positive attitude toward information technology applica-
tions. In addition to these utilitarian aspects, Sweeney and
Soutar (2001) have shown in a more recent publication that
it is essential to also include hedonic elements of benefit.
In sum, our conceptualization offers a more complete
understanding of QES than in previous studies: We build
on extant knowledge to derive a basic set of quality
factors that comprehensively cover environment and
delivery quality. Moreover, we include functional and
emotional benefit as facets of outcome quality in addition
to reliability. Both benefit constructs are of a rather gen-
eral nature and therefore relevant for most electronic
services. As a result, the conceptualization may ade-
quately capture the quality of many different electronic
services that operate through a graphic user interface.
In accordance with the work of Brady and Cronin
(2001), we suggest a hierarchical conceptualization that
translates into a second-order factor model. The mea-
surement model incorporates three quality dimensions
(environment, delivery, and outcome) as second-order
factors that are in turn represented by nine subdimensions
as first-order factors (see Figure 2).
At this stage of our study, the question arises whether
the model specification between the first-order and the
second-order levels should be formative or reflective.
Looking at previous literature on service quality and QES,
as well as taking research on measurement model specifi-
cation into account (e.g., Edwards and Bagozzi 2000;
Jarvis, Mackenzie, and Podsakoff 2003), we conclude that
a reflective model would be more appropriate. In particu-
lar, two considerations lead us to this conclusion: First, we
introduce the second-order level based on the rationale
that the theoretical framework of Rust and Oliver (1994)
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will help us to better understand the associations between
first-order constructs of QES. Therefore, it is very interest-
ing to test whether the conceptually appealing integration
of these three quality dimensions as second-order con-
structs is consistent with the data. However, we do not
intend to entirely determine the conceptual and empirical
meaning of these three quality dimensions, a necessary pre-
requisite for formative measurement. Rather, we argue that,
for instance, attractiveness of selection, information quality,
ease of use, and technical quality (first-order constructs) are
reflections of delivery quality (second-order construct). The
second point is collinearity. Extant research suggests that
strong collinearity can be expected between the nine first-
order constructs. Eventually, they are all reflections of
QES. For example, Parasuraman, Zeithaml, and Malhotra
(2005) reported intercorrelations between first-order qual-
ity factors from two different samples. The correlations are
consistently high and range between .56 and .78. Strong
collinearity is very likely to pose serious difficulties for
measurement when indicators are formative (Jarvis,
Mackenzie, and Podsakoff 2003). This situation would
arise if we specified the first-order constructs as formative
indicators of the three quality dimensions.
RESEARCH METHODS AND RESULTS
Measure Development
Potential items for measuring the nine subdimensions of
QES (first-order factors) were obtained from previous
research, the documentation of the explorative interviews
described above, and also from interviews with four experts
(product managers out of three different divisions of the
service provider we cooperated with). The initial set of
items was first judged for face validity by six experts (4
researchers and two practitioners), using a similar proce-
dure as the one recommended by Hardesty and Bearden
(2004). Then, 10 additional researchers were asked to
complete an item-sort task in order to further assess the
potential items (see also Anderson and Gerbing 1991). This
two-stage procedure resulted in the exclusion of several
potential items and the refinement of the wording for items
retained. In addition to the measures of the subdimensions
of QES, a separate measure of overall service quality was
derived from the literature (Brady and Cronin 2001;
Dabholkar, Shepherd, and Thorpe 2000). The result was a
pool of 39 items to measure 10 different constructs.
In the next step, a separate online questionnaire was
developed for each of three areas of investigation: a
service for the creation and maintenance of personal
homepages (pure service offer), a sports coverage service
(content offer), and an online shop for electronic

equipment (supporting service). Thus, all three major cat-
egories of eletronic services (as outlined above) were cov-
ered. In our conceptual development, we mentioned that
the operationalization of subdimensions might, to a certain
extent, depend on the area of investigation. The product
managers responsible for the three electronic services
shared this view. However, only a few items were con-
cerned. They had to be slightly adapted to the respective
context in order to preserve their identical meaning in dif-
ferent areas of investigation. In this way, we ensured that
respondents would interpret them consistently in each con-
text. An example taken from the sports coverage service
might illustrate this: An item regarding the attractiveness
of selection became clearer when we substituted the origi-
nal item, offers a wide range of products/services, with
offers a wide range of sports content.
In order to avoid a potential common method bias, we
took precautions recommended in the methodological lit-
erature that were applicable in our case (Lindell and
Whitney 2001; Podsakoff et al. 2003). For instance, we
used a scale format for the measure of overall service qual-
ity that differed from the other measures (see Appendix).
Furthermore, we integrated two reverse-scored marker
items into each questionnaire to detect a potential acquies-
cence bias.4 To ensure clarity of wording, the three ques-
tionnaires were then submitted to an in-depth pretest, each
with five potential respondents of the sample population.
The pretests involved a technique called cognitive inter-
viewing (Dillman 2000): We asked participants to respond
to the questionnaire in our presence and to think aloud
while reviewing the items. Compared to regular pretest-
ing, this gave us a much better understanding of how the
items were interpreted and whether the intent of each ques-
tion was being realized. Minor modifications in prefacing
phrases resulted from the pretest.
Data Collection and Sample
The data were obtained in October 2004 through
self-administered online questionnaires from actual cus-
tomers of the above-mentioned electronic services. We
believe that these services represent suitable domains,
because they are of commercial importance in the context
of electronic services: Sports coverage is among the
fastest growing paid content categories on the Internet
(Gray 2005). Likewise, electronic equipment continues
to be a popular online shopping category (Rush 2004).
And with an ever-increasing number of personal home-
pages on the Internet, it is not far-fetched to conclude that
corresponding services are of commercial relevance.
All three chosen electronic services are being offered
by the German service provider that cooperated with us.
The company is one of the major Internet service providers
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Fassnacht, Koese / ELECTRONIC SERVICES 29
in the German market. It offers a broad range of services
from providing Internet access to a variety of paid services
and paid content. According to the results presented by
Graumann and Neinert (2005), Germany is by far the
largest e-commerce market in Western Europe, as 30% of
the total Western European e-commerce revenues are gen-
erated there. Western Europe, in turn, accounts for 31% of
the worldwide e-commerce volume.
As the homepage and the sports coverage services oper-
ate on a subscription basis, random samples were drawn
from the pool of customers with a subscription time of
at least 6 months. Thus, we ensured that they were suffi-
ciently acquainted with the service. The sampling frame
comprised more than 10,000 customers in both cases. The
two random samples contained 2,300 customers each.
However, because of incorrect e-mail addresses, only
2,273 customers of the homepage service and 2,261 cus-
tomer of the sports coverage service could be reached. As
far as the online shop is concerned, the sampling frame
consisted of more than 5,000 customers, who had pur-
chased within the 2 months preceding the study (to ensure
that respondents had at least one usage experience that
they could recall easily). Thereby, we wanted to ensure
that respondents have at least one usage experience, which
they may easily recall. A random sample of 1,300 cus-
tomers was drawn, of which 1,258 had given correct
e-mail addresses. As an incentive, participants of each of
these three samples were included in a separate prize draw.
For the homepage service, the sports coverage service,
and the online shop, 349, 345, and 305 usable responses
were obtained, respectively. This equals a response rate
of 15.4%, 15.3 %, and 24.2 %. None of the three samples
exhibited noteworthy differences in terms of age, gender,
and type of Internet access when compared to the corre-
sponding total customer base. In addition, the age struc-
ture of the three samples strongly resembles that of the
general population of German Internet users as covered
by Nielsen NetRatings, the global standard for Internet
audience analysis (Internet Advertising Bureau 2004).
There was only one marked deviation in comparison to
the results from Nielsen NetRatings: In each of the three
samples, the group of adolescents and young adults (age
< 25 years) was underrepresented. This is not surprising,
because, generally speaking, people in this age-group
(especially the adolescents) are not yet financially able to
use paid content or to shop online on a regular basis.
Furthermore, we did not detect any problems with non-
response bias (Armstrong and Overton 1977). We split the
individual samples in thirds with respect to response time
and then used t tests to compare the means of the relevant
questionnaire items for early responders with those of
late responders. In two samples, merely one item, and
in the third sample, only two items showed significant
30 JOURNAL OF SERVICE RESEARCH / August 2006
differences between the two groups. We concluded that in
our study nonresponse bias was not a problem. Likewise,
we did not detect problems with common method bias
when using Harmans single factor test (Podsakoff et al.
2003). Also, missing data analysis was conducted by
using SPSS. We found that it could be assumed that the
small amounts of missing data in each sample were miss-
ing at random in the sense of Little and Rubin (1987).
Hence, they were imputed by means of the EM-algorithm
available in SPSS (Schafer and Graham 2002).
Since confirmatory factor analysis (CFA) with maxi-
mum-likelihood estimation in LISREL 8.54 would be the
primary method for our analyses, multivariate normality of
observed variables was a critical requirement. However,
data screening showed that this requirement was not met.
We analyzed the data in two steps: First, the Kolmogorov-
Smirnov test available in SPSS was used to compare the
observed distribution of the manifest variables with the
normal distribution. The results indicated that the distribu-
tion of each variable was significantly nonnormal. The
PRELIS program included in LISREL provided an addi-
tional diagnosis of univariate skewness and kurtosis, which
showed that all variables were skewed and most of them
were also kurtotic. In the second step, we again used
PRELIS to assess multivariate normality. The program
uses the same formulas for multivariate skewness, kurto-
sis, and an omnibus test of multivariate normality as
Bollen (1989, p. 423), who in turn drew on Mardias mea-
sures (e.g., Mardia and Foster 1983). An inspection of the
PRELIS output indicated that the data failed all three tests,
that is, the tests of multivariate skewness and kurtosis, as
well as the omnibus test, were all significant at p < .001.
We concluded that the assumption of multivariate normal-
ity has clearly been violated. Thus, in all of the subsequent
analyses, we used an option in LISREL that allows us to
estimate the correct standard errors and chi-square values
under nonnormality by means of asymptotic covariance
matrices (Jreskog et al. 2001; Satorra and Bentler 1994).
As stated earlier, one of our research aims is to develop
a scale that may be applied to different electronic services.
Therefore, conducting our analyses with an aggregated
sample that brings together data from different kinds of
electronic service offerings is preferable. To ensure the
appropriateness of aggregating the data, we tested for full
configural invariance across the three samples (Steenkamp
and Baumgartner 1998). To this end, we ran a multigroup
CFA of the nine proposed subdimensions with factor load-
ings freely estimated across the three samples. In the result-
ing multigroup model, the factor loadings were large and
significant in all three samples, and model-to-data fit was
good (Satorra-Bentler scaled 2 = 3,535.16, df = 1818,
Non-Normed Fit Index [NNFI] = .98, Comparative Fit
Index [CFI] = .98, root mean square error of approxima-
tion [RMSEA] = .053). This strongly suggests that full
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configural invariance is supported and allows us to aggre-
gate all responses to one sample with a total of 999 obser-
vations, forming the basis for subsequent analyses.
Measure Validation and Model Test
To assess the adequacy of our multi-item measures, we
followed standard procedures employed in marketing
research (Gerbing and Anderson 1988; Ping 2004). At
first, we examined item-to-total correlations and coeffi-
cient alpha and then applied exploratory factor analysis to
each subdimension. Because of low item-to-total correla-
tion, we eliminated one item from functional benefit and
one item pertaining to the attractiveness of selection.
Subsequently, we used CFA to assess subdimensions with
at least three items. We carefully evaluated parameter esti-
mates, t values, item reliabilities, and model fit. As a result,
we omitted another four items (one each for graphic qual-
ity, ease of use, technical quality, and reliability) because
the respective parameter estimates were comparatively low
and modification indices rather high. The same two-step
procedure was then applied to test a first-order factor
model with all nine subdimensions. Again, parameter esti-
mates and modification indices in CFA strongly suggested
that more items should be omitted to attain unidimension-
ality for each measure. The appendix lists items omitted
and items retained, together with the mean and standard
deviation of the resulting scales.
Some points regarding the measure validation proce-
dure are worth addressing in order to give possible theo-
retical explanations for decisions that were necessary
from a psychometrical viewpoint, but not obvious in light
of our conceptualization. The two items of graphic qual-
ity that had to be omitted comprised aesthetical features
of the service environment. On the basis of our data, this
notion seems less important than the exact representation
and readability of elements displayed on the user inter-
face. Moreover, it is a little surprising that security of
data transfer has not been sufficiently associated with
technical quality. However, there are studies suggesting
the low importance of security issues (Belanger, Hiller,
and Smith 2002). A closer look at the correspondence of
this item to other constructs only revealed a moderate and
insignificant association with reliability. Interestingly,
another omitted item, accuracy of information, showed a
similar association. From the customers point of view,
these two items seem to be subsumed under reliability.
This might explain the need to eliminate them from the
other scales. Another possible explanation could be that
customers are unable to assess these things properly.
They know the degree to which they trust the service
provider, but they might not be able to judge whether the
information provided is really accurate or the data trans-
fer is really safe.

In the next step of our analysis, we again set up a mea-
surement model comprising all nine subdimensions of
QES as first-order factors and conducted chi-square dif-
ference tests (Satorra and Bentler 2001). Moreover, we
examined the discriminant validity criterion proposed by
Fornell and Larcker (1981). Both analyses suggest that all
nine subdimensions are distinct latent constructs. To test
the hierarchical conceptualization of QES as depicted in
Figure 2, we then specified a model containing the nine
subdimensions as first-order factors and the three dimen-
sions as second-order factors. The results of the second-
order CFA are displayed in Table 2 (for a discussion of
reliability and validity assessment of constructs in a
second-order factor model, see Ping 2004). All constructs
show good internal consistency, with construct reliabili-
ties ranging from .83 to .93, as well as convergent valid-
ity, with average variances extracted ranging from 70% to
87%. Analogous to the first-order factor model, we tested
discriminant validity of the dimensions and subdimen-
sions by means of Fornell and Larckers (1981) criterion.
This time, results were mixed: Whereas the nine subdi-
mensions demonstrated discriminant validity, the three
dimensions did not. As this criterion is very strict, we also
conducted chi-square difference tests of the three dimen-
sions and found that all three chi-square differences were
significant at p < .01. We conclude that the three dimen-
sions are sufficiently distinct, representing different facets
of the same overall construct. It should also be noted that
the correlations shown in Table 2 confirm our expectation
of strong collinearity between the constructs, thus sup-
porting our reflective model specification.
For a comprehensive evaluation of the model-to-data
fit, we resorted to different goodness-of-fit criteria (see
Table 3). Comparing the results with the cutoff values
found in the methodological literature (e.g., Schermelleh-
Engel, Moosbrugger, and Mller 2003), we infer that our
model fits the data quite well. The ratio of the Satorra-
Bentler scaled chi-square and degrees of freedom (688.66/
238 = 2.89) is satisfactory given the complexity of the
measurement model and the large aggregated sample.
The other goodness-of-fit criteria exhibit strong results,
especially the NNFI (.99), the CFI (.99), and the stan-
dardized root mean square residual (SRMR = .030).
We also assessed the criterion validity of the three pro-
posed dimensions of QES (Ping 2004). We examined their
correlations with a separate three-item measure of overall
service quality (construct reliability = .91, average variance
extracted = 77%). The correlations of this construct with
the environment, delivery, and outcome dimensions of QES
are .57, .65, and .70, respectively (p < .001). This further
supports the adequacy of our conceptualization. It is a note-
worthy result that the outcome dimension exhibited the
highest correlation with overall service quality. At the same
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Fassnacht, Koese / ELECTRONIC SERVICES 31
time, the subdimension of functional benefit had a very
high loading on outcome (.95). This substantiates our
assumption that outcome in general and functional benefit
in particular play a crucial role in the evaluation of QES.
To assess the nomological validity of QES, we speci-
fied a structural model in which QES is modeled as an
exogenous latent variable influencing overall customer
satisfaction. Literature on services marketing has reached
consensus on the positive effect of service quality on cus-
tomer satisfaction (Cronin, Brady, and Hult 2000). For the
purpose of this analysis, we computed factor scores for
the nine subdimensions of QES and used them as indica-
tors of the three dimensions. These were in turn treated as
indicators of the second-order factor QES. Overall cus-
tomer satisfaction was represented by a separate two-item
measure. The resulting standardized coefficient for the
path from QES to overall customer satisfaction was .82
(significant at p < .01), with an explained variance of .67.
This result supports the nomological validity of QES.5
In addition, we compared our model to other theoreti-
cally plausible model specifications. One could argue, for
instance, that attractiveness of selection is rather a subdi-
mension of environment quality than of delivery quality
(alternative Model 1). Another possibility (alternative
Model 2) would be a specification with only two quality
dimensions. It mirrors the quality model of Grnroos
(1984) and is also very similar to the conceptualization
proposed by Collier and Bienstock (2003). In this case,
environment and delivery quality are merged into one
dimension, whereas outcome quality stays the same. Fit
measures for the two alternative models are presented
along with the fit measures of our model (proposed
model) in Table 3. A comparison clearly indicates that
our model is the best of the three competing models in
terms of fit. An inspection of the Akaike Information
Criterion (AIC) particularly corroborates this. When
comparing a set of competing models for the same data,
the methodological literature recommends selecting the
model with the lowest AIC value (Schermelleh-Engel,
Moosbrugger, and Mller 2003).
The successful model testing with a large aggregated
sample from three different electronic services provides
initial evidence that our model exhibits a certain degree
of generalizability. Because one of our research aims has
been to develop and test a scale that may indeed be
applied to a broad range of electronic service offerings,
we additionally assess our model within the three indi-
vidual samples. All loadings are consistently large (.70 or
above) and significant at p < .01 in all samples. As the
right-hand side of Table 3 shows, model-to-data fit is also
good in each of the samples. Thus, our study provides
empirical evidence suggesting that the developed scale is
fairly robust across different electronic services.
32 JOURNAL OF SERVICE RESEARCH / August 2006

TABLE 2
Correlation Matrix of Constructs and Results of Second-Order
Confirmatory Factor Analysis (N = 999)
First-Order Factors Second-Order Factors

Factor 1 2 3 4 5 6 7 8 9 10 11 12

1. Graphic Quality
2. Clarity of Layout .87
3. Attractiveness of Selection .70 .70
4. Information Quality .80 .79 .73
5. Ease of Use .82 .81 .75 .85
6. Technical Quality .70 .69 .64 .73 .74
7. Reliability .74 .73 .69 .78 .80 .82
8. Functional Benefit .78 .78 .73 .84 .86 .73 .85
9. Emotional Benefit .65 .64 .61 .69 .71 .60 .70 .88
10. Environment Quality .94 .93 .75 .85 .87 .75 .78 .83 .69
11. Delivery Quality .88 .87 .80 .91 .93 .80 .86 .92 .76 .94
12. Outcome Quality .83 .82 .77 .88 .90 .77 .89 .95 .79 .88 .97
Standardized estimates* .83-.88 .83-.88 .85-.95 .81-.91 .82-.87 .81-.86 .84-.91 .85-.88 .83-.86 .93-.94 .80-.93 .79-.95
Construct reliability .89 .90 .90 .90 .91 .87 .87 .86 .83 .93 .92 .91
AVE 73% 74% 81% 74% 72% 70% 77% 75% 71% 87% 74% 77%

NOTE: AVE = average variance extracted.

* All estimates are significant at p < .001.

TABLE 3
Overview of Model-to-Data Fit
Aggregated Sample (N = 999) Individual Samples

Alternative Alternative Homepage Service Sports Coverage Shop

Fit Measure Proposed Model Model 1 Model 2 (n = 349) (n = 345) (n = 305)

Satorra-Bentler scaled chi-square 688.66 720.59 740.03 453.19 354.07 470.01

Degrees of freedom 238 238 240 238 238 238
NNFI .99 .99 .99 .98 .99 .98
CFI .99 .99 .99 .99 .99 .99
SRMR .030 .033 .033 .042 .033 .049
RMSEA .044 .049 .046 .051 .038 .057
AIC 812.66 844.59 860.03 577.19 478.07 594.01

NOTE: NNFI = Non-Normed Fit Index; CFI = Comparative Fit Index; SRMR = standardized root mean square residual; RMSEA = root mean square
error of approximation; AIC = Akaike Information Criterion.

DISCUSSION understanding of QES than in previous studies. It inte-

Considerable research effort has already been devoted
to QES. This is not surprising given the managerial impor-
tance and theoretical appeal of the subject. But clear defi-
nitions, solid conceptual work, and empirical studies in
multiple settings have been scarce, suggesting that we are
still in the early stages within this field of research.
The results of the present study make a contribution in
two important ways: First, on the basis of a clear-cut def-
inition of the reference object and the general framework
of service quality proposed by Rust and Oliver (1994),
we developed a conceptualization with three dimensions
and nine subdimensions that offers a more complete
grates findings from existing literature as well as extends
previous work by taking two additional facets of outcome
quality into account. Empirical evidence supported our
notion of a multidimensional hierarchical construct. The
hierarchical nature of the proposed conceptualization
offers interesting insights into how QES is reflected in the
customers perceptions. Moreover, the inclusion of aspects
such as ease of use, which are specific to electronic
services, shows that measuring QES has to be different
from measuring traditional service quality. Second, by rig-
orously testing our model with data from three different
electronic services, we removed the contextual lens pre-
vailing in extant research. In particular, two of the three

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areas of investigation were pure services. By and large,
these kinds of services have been neglected by previous
empirical research on QES. Our results provide initial
empirical evidence that the developed scale is fairly robust
across contexts. Unlike many other scales, the measures
are formulated in a rather general way and do not focus on
specific areas like shopping or financial services. Thus, we
infer that the scale might be more easily applied to a broad
range of electronic services than existing scales.
Our findings have several managerial implications. As
mentioned previously, appropriate conceptualization and
measurement are crucial for an effective management of
service quality, particularly on the Internet. Delivery of
high service quality, in turn, is necessary for customer sat-
isfaction and loyalty in the online world. In recent years,
we have seen that, on the Internet, it is insufficient to sim-
ply attract as many customers as possible. Prominent Web
presence and low prices may easily achieve this. Yet, they
are not sufficient to win customers over and gain a com-
petitive edge: Web presence may be imitated, and price
comparisons are easily accomplished. Moreover, elec-
tronic services are no longer regarded as trendy Internet
applications. Rather, customers become more and more
demanding, and they are less tolerant of poor service per-
formance. It is the delivery of high service quality that
makes customers come back and buy again, thereby gen-
erating earnings that are essential for long-term success.
Thus, better quality is a primary source of competitive
advantage for providers of electronic services.
Our model can guide managers in their effort to
improve QES, as it clearly highlights the need to consider
the environment, delivery, and outcome dimensions of
quality. The relative importance of the outcome dimen-
sion (especially the subdimension of functional benefit)
calls into mind that technology is a means, not an end.
Moreover, the hierarchical nature of the construct demon-
strates that there are several levels of abstraction that have
to be taken into account. After all, environment, delivery,
and outcome quality are reflected in nine subdimensions.
These have been developed from a basic set of subdimen-
sions that has consistently recurred in the literature as well
as in the qualitative study. Therefore, providers of elec-
tronic services should ensure that quality is delivered with
respect to all of these nine subdimensions.
The proposed scale may be used by the practitioner
either in its entirety to conduct a comprehensive ass-
essment of QES or focused on a specific dimension.
Because the scale has been generated from a multiservice
sample, it is well suited for service providers who intend
to make comparisons across different kinds of electronic
services.
As far as research implications are concerned, the out-
come dimension of QES calls for further investigation,
because our findings have indicated that this dimension is
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Fassnacht, Koese / ELECTRONIC SERVICES 33
of relatively high importance. Especially, functional and
emotional benefit deserves more research attention in
order to further examine the role it plays in evaluating
QES. In addition, literature on consumption benefits sug-
gests that products and services may also deliver social
benefit. It could be worthwhile investigating to what
extent social benefit is relevant in the present context.
Moreover, future studies could draw on service recov-
ery research to examine how adding recovery dimensions
affected the present model. These dimensions could then
incorporate electronically mediated service encounters
like customer-employee interactions via telephone or
e-mail. It could be interesting to compare the results of
such an approach with previous research on QES that has
also tried to include recovery dimensions (Parasuraman,
Zeithaml, and Malhotra 2005).
Another direction for further research might be to look
for potential differences concerning the perception of QES
in various contexts. For example, emotional benefit might
have a higher relevance for news and weather services than
for online shopping. Because of the comprehensive nature
and the broad applicability of our model, it lends itself to a
comparison of different kinds of electronic services.
Furthermore, it would be of merit to examine the con-
sequences of QES as measured by the present scale. The
positive impact of quality on other constructs such as
customer satisfaction, perceived value, or loyalty has
often been empirically supported in other service con-
texts. Yet, substantial empirical findings are missing for
electronic services. In particular, loyalty and trust have
been said to be even more important on the Internet than
in other contexts (Reichheld and Schefter 2000). Thus, an
investigation of the link between QES and loyalty as well
as trust should be a research priority.
As every research project, our study also has some
limitations. In addition to the initial empirical evidence pre-
sented here, the developed scale needs to be reassessed with
data from other relevant areas in order to provide stronger
support for its broad applicability. Besides other Internet-
based electronic services (e.g., music downloads), the
mobile commerce area would be potentially fruitful for
such an endeavor, because an increasing number of elec-
tronic services are offered via mobile phones. Moreover,
the instrument could also be applied to business-to-business
or electronic government contexts. Also, our study has been
limited to one country, Germany, and even though the work
of Tsikriktsis (2002) showed that on the Internet, culture
has a minor impact on service quality evaluations compared
to traditional services, an application of our model to vari-
ous cultural contexts could be worthwhile.
Measurement model specification is becoming a more
and more important topic in marketing research, espe-
cially the issue whether reflective or formative measure-
ment is more appropriate. Unfortunately, we were unable
34 JOURNAL OF SERVICE RESEARCH / August 2006

to compare the two approaches to measurement model
specification within this study, because separate (reflec-
tive) indicators for the second-order constructs were not
available. Future research should explicitly address this
issue and include separate (reflective) measures for
higher-order constructs. Finally, it should be noted that
our data exhibited strong collinearity. On one hand, this fact
supports our reflective model specification. On the other
hand, it might also have affected our analyses, especially
those concerning the test for nomological validity. With
strong collinearity, sampling fluctuations, for example,
might have had more impact than in other studies.

APPENDIX
Survey Items a

Items Retained in Items Omitted in the Scale Mean/

Construct (Subdimension of QES) the Final Model Course of Measure Validation Standard Deviation

Graphic Quality
Items partly adapted from Aladwani
and Palvia (2002); Zeithaml,
Parasuraman, and Malhotra (2000)
Text is always displayed legibly. The graphic representation is 4.00/0.97
Symbols/icons are readily identifiable. appealing.
Pictures/images are always displayed Colors are used in a pleasant way.
properly.

Clarity of Layout The layout enables the user to find 3.76/0.92

Items partly adapted from Montoya- important things at first sight.
Weiss, Voss, and Grewal (2003); Everything is clearly arranged.
Santos (2003) The layout provides a clear structure.

Attractiveness of Selection XYZ offers a wide range of . . . XYZ offers . . . that other providers 3.65/1.02
Items partly adapted from Nacif XYZ offers a complete selection of . . . do not have.
(2003); Wolfinbarger and Gilly
(2003)

Information Quality Information provided is up-to-date. Information provided is accurate. 3.83/0.96

Items partly adapted from Loiacono, Information provided is easy to
Watson, and Goodhue (2002); understand.
Montoya-Weiss, Voss, and Grewal XYZ provides all the information
(2003) necessary.

Ease of Use
Items partly adapted from Collier and
Bienstock (2003); Zeithaml,
Parasuraman, and Malhotra (2000)
XYZ directs the customer step by step. With XYZ, log-in and log-out are 4.04/0.98
When using XYZ, the customer has full simple.
control at all times. XYZ offers easy navigation.
Only a few clicks are needed in order
to . . .
It does not take much time to learn the
handling of XYZ.

Technical Quality XYZ is always up and running. Data transfer is secure. 3.90/1.06
Items partly adapted from Aladwani Data transfer is stable. Pages load quickly.
and Palvia (2002); Sultan et al. Pages load properly.
(2002)

Reliability Service performance of XYZ is as XYZ delivers . . . at the time 4.05/1.08

Items partly adapted from Santos desired. promised.
(2003); Yang, Peterson, and Cai Service performance of XYZ is Accounts are kept accurately.
(2003) absolutely reliable.

Functional Benefit XYZ serves its purpose very well. XYZ is more convenient than other 3.98/0.96
Items partly adapted from Loiacono, XYZ is an easy way to . . . options for . . .
Watson, and Goodhue (2002)

Emotional Benefit Using XYZ invites the customer to stay. Using XYZ is enjoyable. 3.63/1.02
Items partly adapted from Nacif Using XYZ is fun.
(2003)

(continued)

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APPENDIX (continued)
Items Retained in
Construct (Subdimension of QES) the Final Model
Overall Service Quality Excellent to poor
Items partly adapted from Brady and Superior to inferior
Cronin (2001); Dabholkar, High quality to low quality
Shepherd, and Thorpe (2000)
NOTE: All items, except those for Overall Service Quality, were scored on a 5-point Likert-type scale ranging from 1 = strongly disagree to 5 = strongly
agree. For the Overall Service Quality scale, we used 5-point semantic differential items with the value 1 at the positive end and the value 5 at the neg-
ative end of the scale. Individual prefacing phrases for each of the three electronic services ensured clarity of wording. Three consecutive full stops
( . . . ) indicate that an item had to be partly adapted to the particular context. QES = quality of electronic services.
a. Translation of German.
NOTES
1. By traditional services we refer to services with pivotal customer-
employee interaction, for example, travel and accommodation, financial
consulting, or medical treatment. Previous research on service quality
has typically focused on these kinds of services.
2. The same definition is put forth by the three authors in a more
recent study on electronic service quality (Parasuraman, Zeithaml, and
Malhotra 2005, p. 217).
3. At this point, we do not review these publications. The main insights
and identified research gaps in this body of literature have already been
dealt with in the literature review section of the article. Moreover, most of
these publications are cited within the text or the appendix. A complete list
of references is available from the authors upon request.
4. These additional items were only used for the purpose of detect-
ing a potential acquiescence bias. They were not included in subsequent
analyses.
5. Given the strong collinearity in our data and considering the fact
that the structural model is merely used to test the nomological validity
of quality of electronic services, overall goodness of fit is acceptable:
Satorra-Bentler scaled chi-square = 303.79, degrees of freedom = 38,
Non-Normed Fit Index = .98, Comparative Fit Index = .98, standardized
root mean square residual = .035, root mean square error of approxi-
mation = .084. Within the frame of the structural model, the psychome-
tric properties of the two-item measure of overall customer satisfac-
tion can also be assessed (construct reliability: .92, average variance
extracted: 85%) because the corresponding parameter estimates are
identified.
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Martin Fassnacht is the Otto Beisheim Endowed Chair of
Marketing and Speaker of the Marketing Group at WHU
Otto Beisheim School of Management in Vallendar
(Germany). He acts as scientific director of the Center for
Market-Oriented Management at WHU. He is also academic
director of the Metro Business Program and METRO Business
Program Advanced, executive education programs for METRO
Group. In addition, he serves as Director of Marketing at
Downloaded from jsr.sagepub.com at UNIV OF CHICAGO LIBRARY on May 19, 2014
Fassnacht, Koese / ELECTRONIC SERVICES 37
WHU. He received his PhD from the University of Mainz and
completed his habilitation (postdoctoral thesis) at the
University of Mannheim (both Germany). He is the
author/coauthor of several articles in ref-ereed journals,
including Journal of Marketing and Journal of Business-to-
Business Marketing, whose editorial board voted one of his
contributions Outstanding Article of the Year 2003. His teach-
ing and research focus on the fields of price management,
services and retail marketing, market-oriented management,
and relationship marketing.
Ibrahim Koese has been a research assistant and PhD student
at the Otto Beisheim Endowed Chair of Marketing at WHU
Otto Beisheim School of Management in Vallendar (Germany).
He received his diploma in business administration from the
University of Mannheim (Germany). His research interests
include services marketing, electronic commerce, and market-
oriented management.