tag:blogger.com,1999:blog-70363044237866475502024-02-08T06:55:51.150-08:00Nurazreen FYPNurazreen FYPhttp://www.blogger.com/profile/03307336878903933160noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-7036304423786647550.post-14500530998547947592011-11-20T02:14:00.001-08:002011-11-20T02:14:38.868-08:00update chp 1 lg<div class="MsoNormal" style="line-height: 150%; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 150%;">Research Background<o:p></o:p></span></div><div class="MsoNormal" style="line-height: 150%; margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 150%;">In terms of making decision to purchase a car, many aspects need to be considered. However, selecting a suitable car is often done in an unplanned manner. Making decision in purchasing a car is an important aspect since a lot of criteria needs to be taken into account. Currently, there are a lot of specification would be demanded by car buyers to purchase their dream car. This sort of decision have a major impact in their life. Customers will satisfied if they purchase their car rightly that includes their budget and they will feel frustrated and get a little stress if they purchase wrong car. Therefore, in order for them to make a right decision there should be a system to generate suitable car that will help them in making decision and give pre-liminary idea to them when they want to purchase a car. The system will take into account their demographic factors such as income, work and also specification of car that demanded by the customer. This research will demostrates the use of rule-based classification to suggest suitable car to car’s buyer. The scope involved in this study were the automobile company for PROTON also the customers. <o:p></o:p></span></div><div class="MsoNormal" style="line-height: 150%; margin-left: 36.0pt; text-align: justify;"><span class="apple-style-span"><span style="background: white; font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 150%;">Data mining involves the exploration and analysis of large databases to find patterns and valuable information that can aid in decision making. This research used the rule-based classification to recommend suitable car to customers. </span></span><span style="font-family: 'Times New Roman', serif; font-size: 12pt; line-height: 150%;">In rule-based classification, group documents together, decide on categories, and formulate the rules that define those categories; these rules are actually query phrases. Then index the rules and use the<span class="apple-converted-space"> </span><code><span style="font-family: "Times New Roman","serif"; line-height: 150%; mso-ansi-font-size: 12.0pt; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Calibri; mso-fareast-theme-font: minor-latin;">MATCHES</span></code><span class="apple-converted-space"> </span>operator to classify documents. </span><span class="apple-style-span"><span style="background: white; font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 150%;">This research illustrates the use of data mining approach to build predictive pattern for predicting customer's intent of purchasing car<span style="color: #333333;">.</span></span></span><span class="apple-style-span"><span style="background: white; color: #333333; font-family: "Verdana","sans-serif"; font-size: 7.0pt; line-height: 150%;"> <o:p></o:p></span></span></div>Nurazreen FYPhttp://www.blogger.com/profile/03307336878903933160noreply@blogger.com0tag:blogger.com,1999:blog-7036304423786647550.post-20536553611822279132011-11-07T06:27:00.000-08:002011-11-07T06:27:34.314-08:00working on problem statement<div class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: justify;"><b><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt;">Problem Statement<o:p></o:p></span></b></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><br />
</div><div class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt;">Car is an important thing in our life because we need a transport to move to another place. Occasionally, purchasing a car is a big-ticket item to be purchased. Nowadays, according to Habibah bt. Abd Rahman (sales advisor for PROTON ) at Quantum Plus Sdn.Bhd in Seksyen 13,Shah Alam said that many customers experience anxiety when deciding on and purchasing a car. .This statement also supported by Kahneman et al., (1986); Kalapurakal et al., (1991) in their journal said that when the customers need to purchase a car quickly and have no other options, they may feel more vulnerable due to the fear that the seller will take advantage of this opportunity to quote a higher price than in other situations regardless whether the seller actually takes such an action. This situation situations do influence buyers’ price fairness perceptions, especially when buyers have no other alternatives. From the initial interview revealed that the car buyers indicated they felt some anxiety at the initial stages of the purchasing process. Normally, the customer perceives as having negotiating advantages such as better information involves negotiating with a dealer or salesperson in the purchasing process. This purchase made seriously as a commitment to years of future car payments, taxes, maintenance and operating costs. So, a lot of time need to spend in making decision the vehicle they wants to purchase. <o:p></o:p></span></div>Nurazreen FYPhttp://www.blogger.com/profile/03307336878903933160noreply@blogger.com0tag:blogger.com,1999:blog-7036304423786647550.post-43021434957032872352011-11-05T03:35:00.000-07:002011-11-05T03:35:49.025-07:004 november 2011updated chapter 1 and submit chapter 2.<br />
<br />
updated problem statement:<br />
<br />
<div class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: justify;"><b><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt;">Problem Statement<o:p></o:p></span></b></div><div class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: justify;"><br />
</div><div class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: justify;"><span style="font-family: 'Times New Roman', serif; font-size: 12pt;">Purchasing a car is a big-ticket item that is purchased only occasionally,many consumers experience anxiety when deciding on and purchasing a car. Often, the purchasing process involves negotiating with a dealer or salesperson whom the consumer perceives as having negotiating advantages (such as better information, negotiation skills and leverage). It is a purchase made seriously as a commitment to years of future car payments, taxes, maintenance and operating costs. Most will also spend a lot of time in the vehicle they purchase. Because of these high economic and, stress levels and social stakes can be high. <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><br />
</div><div class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt;">Car is an important thing in our life because we need a transport to move to another place. In our interviews consumers frequently talked about their need for the car such as whether they can wait or they have a very short span of time to get the car. For example, their previous car may have broken down or they had an accident and needed to get a new car quickly. Consumers have some common knowledge that in a market economy prices are subject to variations in supply and demand. When demand increases relative to supply, sellers have an opportunity to raise prices and increase their profits. Therefore, when consumers need to purchase a car quickly and have few or no other options, they may feel more vulnerable due to the fear that the seller will take advantage of this opportunity to quote a higher price than in other situations regardless whether the seller actually takes such an action. The dual entitlement principle implies that such situations do influence buyers’ price fairness perceptions, especially when buyers have no other alternatives (Kahneman et al., 1986; Kalapurakal et al., 1991). These initial interviews also revealed that the car buyers indicated they felt some anxiety at the initial stages of the buying process. <o:p></o:p></span></div><div class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: justify;"><br />
</div><div class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt;">Therefore,this research is conducted to help customer to have a valuable decision and to satisfied them by the recommend system that will develop to suggest suitable car for them.<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><br />
</div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: 'Times New Roman', serif; font-size: 12pt; line-height: 115%;"><o:p>updated objectives:</o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: 'Times New Roman', serif; font-size: 12pt; line-height: 115%;"><o:p><br />
</o:p></span></div><div class="MsoNormal" style="text-align: justify;"></div><div class="MsoNormal"><b><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">Project Objectives<o:p></o:p></span></b></div><div class="MsoNormal"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"> This project is implemented in order to achieve several objectives.The objectives of <o:p></o:p></span></div><div class="MsoNormal" style="text-indent: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">this project are as follows:<o:p></o:p></span></div><div class="MsoNormal"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"> 1) To identify the specification of car of a customer interest in the time the customer <o:p></o:p></span></div><div class="MsoNormal"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"> wants to purchase car at PROTON and PERODUA showroom. <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">2) To analyze the specification of car interested by the customers and match the <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"> suitable car for them<o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">3)To develop a recommend system that will suggest suitable car that meets the <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"> customer specifications of car using rule-based classification.<o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">4) To verify whether the suggested car developed by the recommend system is <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"> accepted by the customers or not.<o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><br />
</span></div><div class="MsoNormal" style="margin-left: 36pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">But after I see Dr.Ariza, I have to correct back my problem statement .</span></div><br />
<div class="MsoNormal" style="text-align: justify;"><span style="font-family: 'Times New Roman', serif; font-size: 12pt; line-height: 115%;"><o:p><br />
</o:p></span></div>Nurazreen FYPhttp://www.blogger.com/profile/03307336878903933160noreply@blogger.com0tag:blogger.com,1999:blog-7036304423786647550.post-68601603320242982412011-11-04T19:57:00.000-07:002011-11-04T19:57:19.753-07:00chapter 2Pricing strategy & practice<br />
The influence of price fairness on customer<br />
satisfaction: an empirical test in the context of<br />
automobile purchases<br />
Andreas Herrmann<br />
University of St Gallen, St Gallen, Switzerland<br />
Lan Xia<br />
Marketing Department, Bentley College, Waltham, Massachusetts, USA<br />
Kent B. Monroe<br />
University of Illinois and University of Richmond, Glen Allen, Virginia, USA, and<br />
Frank Huber<br />
University of Mainz, Mainz, Germany<br />
Abstract<br />
Purpose – This paper aims to link conceptually the concepts of price fairness and customer satisfaction and empirically demonstrate the influence of<br />
perceived price fairness on satisfaction judgments. Further, it seeks to examine specific factors that influence fairness perceptions including price<br />
perception and consumer vulnerability.<br />
Design/methodology/approach – The study is conducted in the context of automobile purchases in major German car dealerships. Based on a<br />
theoretical conceptualization of the constructs and an empirical pretest, 246 car buyers were surveyed and their fairness perceptions and satisfaction<br />
judgments with the car buying process measured.<br />
Findings – The research shows that price perceptions directly influence satisfaction judgments as well as indirectly through perceptions of price<br />
fairness. Results also indicated that consumers’ vulnerability, which is induced by a perceived demand-supply relationship and the urgency of need from<br />
the consumers’ side, had a negative effect on perceived price offer fairness.<br />
Research limitations/implications – The research demonstrated the influence of perceived price fairness on satisfaction judgments empirically. The<br />
study was conducted in the context of car purchases and the generalizability of the model should be further tested.<br />
Practical implications – The effect of consumer vulnerability implies that sellers should not only avoid exploiting their customers but should also<br />
anticipate consumers’ potential feelings of being exploited. Being sensitive to the buyers’ psychological state and assuring buyers of fair treatment will<br />
enhance perceptions of price fairness without changing the price offer.<br />
Originality/value – Both the direct and indirect effects of price perception on satisfaction judgment were examined in the paper. Specifically, the<br />
influences of consumer vulnerability and price procedure fairness on satisfaction judgments are new and contribute to the dual-entitlement principle<br />
and our existing knowledge in price fairness.<br />
Keywords Fair value, Customer satisfaction, Prices, Perception<br />
Paper type Research paper<br />
Previous research on customer satisfaction has examined<br />
factors that enhance customer satisfaction in various contexts<br />
(for recent reviews see, Oliver, 1997; Szymanski and Henard,<br />
2001; Shankar et al., 2003). As an important factor in the<br />
marketing mix, the role of product or service price in the<br />
formation of customer satisfaction has not been studied<br />
extensively in previous customer satisfaction research (Voss<br />
et al., 1998). When price has been included, it has been one of<br />
several product attributes considered relevant (Fornell et al.,<br />
1996; Voss et al., 1998); however, the unique influence of<br />
product price on satisfaction judgments remains unclear. In<br />
this research we include consumers’ price perceptions as an<br />
important factor influencing overall satisfaction judgments.<br />
This influence is both direct, and indirect via price fairness<br />
perceptions.<br />
Voss et al. (1998) argue that satisfaction is a function of<br />
price, performance and expectations with support for the<br />
expectations-satisfaction link being weak. They propose that,<br />
in contrast to performance, perceived price fairness might be<br />
The current issue and full text archive of this journal is available at<br />
www.emeraldinsight.com/1061-0421.htm<br />
Journal of Product & Brand Management<br />
16/1 (2007) 49–58<br />
q Emerald Group Publishing Limited [ISSN 1061-0421]<br />
[DOI 10.1108/10610420710731151]<br />
49<br />
the dominant determinant of satisfaction. Their empirical<br />
results suggest that when there was a perceived priceperformance<br />
inconsistency (i.e., an inequitable or unfair<br />
outcome), it had a stronger effect (negative) on satisfaction<br />
judgments. Similar results were also found by Oliver and<br />
DeSarbo (1988) and Oliver and Swan (1989a).<br />
In addition, research also has shown that equity is related to<br />
satisfaction. Equity is a concept closely related to fairness and<br />
usually defined as a fairness, rightness, or deservingness<br />
judgment that consumers make in reference to comparative<br />
others (Oliver, 1997; Xia et al., 2004). A recent meta-analysis<br />
of the empirical research on customer satisfaction found that<br />
equity exhibited a dominant effect on satisfaction judgments<br />
with a correlation between equity and satisfaction of 0.50<br />
(Szymanski and Henard, 2001). The correlation between<br />
expectations and satisfaction was a lower 0.27. However,<br />
relative to previous customer satisfaction research, little<br />
published research has linked perceptions of price fairness<br />
with satisfaction judgments. In this paper, we address this<br />
link. Specifically, we extend Voss et al.’s (1998) finding to the<br />
issue of perceived fairness. We include two components of<br />
price fairness (price offer vs procedure) as well as a consumer<br />
psychological characteristic (vulnerability) and examine their<br />
effects on satisfaction judgments. We begin with an overview<br />
of the satisfaction and fairness concepts leading to a<br />
conceptual model and hypotheses. An empirical test of the<br />
model using automobile purchases follows.<br />
Conceptual framework<br />
Customer satisfaction<br />
Various definitions and measures of customer satisfaction<br />
have been used in previous research (Szymanski and Henard,<br />
2001). One approach has been to distinguish between<br />
transaction-specific and overall satisfaction (Oliver, 1997).<br />
We distinguish satisfaction with the purchase process (e.g.<br />
product comparisons and interactions with the sales people)<br />
and satisfaction with the purchase outcome (i.e. the product<br />
purchased). Previous research has shown that these two<br />
components of satisfaction are correlated but conceptually<br />
distinct (Bitner and Hubbert, 1994; Shankar et al., 2003). For<br />
example, in the context of using online decision aids,<br />
Bechwati and Xia (2003) found that people’s perceptions of<br />
how much “effort” the decision aids exert in providing the<br />
recommendations influenced their satisfaction regardless of<br />
what options were recommended. Similarly, Spreng et al.<br />
(1993) proposed that customers’ satisfaction with the<br />
availability of product information when evaluating various<br />
product options has an important influence on overall<br />
satisfaction judgments.<br />
These influences may occur particularly for purchases that<br />
involve extensive information search and multiple interactions<br />
with the seller such as an automobile. The purchase of an<br />
automobile involves multiple stages including information<br />
search, comparison of alternatives, and interactions with the<br />
sales people or service provider. We propose that satisfaction<br />
with one stage of this purchase process will have a direct<br />
influence on the satisfaction with other stages, especially when<br />
different aspects of the purchase process occur sequentially.<br />
That is, people are more likely to perceive subsequent<br />
purchase stages consistent with their initial judgment and any<br />
positive or negative affect that occurs during one purchase<br />
stage likely will carry over to the next stage.<br />
Price fairness<br />
Recent research efforts have isolated several factors that<br />
influence consumers’ price unfairness perceptions as well as<br />
potential consequences of these perceptions (Bolton et al.,<br />
2003; Campbell, 1999; Vaidyanathan and Aggarwal, 2003;<br />
Xia et al., 2004). Previous research has distinguished<br />
distributive fairness and procedural fairness. The principle<br />
of distributive fairness, or fairness of outcomes, maintains that<br />
individuals judge the fairness of a relationship based upon the<br />
allocation of rewards resulting from their contributions to the<br />
relationship (Homans, 1961). Thus, unequal ratios of profits<br />
to investments between all parties involved in an exchange<br />
relationship create perceptions of unfairness.<br />
Procedural fairness concerns judgments whether processes<br />
are based on prevailing norms and behaviors (Thibaut and<br />
Walker, 1975). We propose that consumers’ price fairness<br />
perceptions are influenced by both procedural and<br />
distributive considerations. For example, a dealer’s price<br />
offer for an automobile may be accompanied with an<br />
explanation of the prices of various options and delivery<br />
charges, as well as required down payment and financing<br />
arrangements. In such situations, both the initial price of the<br />
car quoted by the sales person (i.e., price offer) and the terms<br />
associated with the price and how these terms are handled<br />
and explained to the consumer (i.e. price procedure) will<br />
influence consumers’ fairness perceptions. Also, price offer<br />
fairness perceptions and price procedural fairness perceptions<br />
are positively correlated. The order of influence will be<br />
determined by the sequence in which consumers receive the<br />
price offer and the price procedural information (van den Bos<br />
et al., 1997).<br />
Another foundation of price fairness perceptions, the<br />
principle of dual entitlement, suggests that one party should<br />
not benefit by causing a loss to another party. When a firm<br />
uses higher consumer demand to its own advantage by<br />
increasing prices, consumers will feel being exploited and<br />
hence perceive the prices as unfair. For example, one study<br />
showed that 82 percent of the respondents judged a price<br />
increase for snow shovels the morning after a snowstorm to be<br />
unfair, while only 21 percent of respondents viewed an<br />
increase in grocery prices following an increase in wholesale<br />
prices as being unfair (Kahneman et al., 1986). While the dual<br />
entitlement principle originated from buyers’ reactions toward<br />
sellers’ obvious exploitation based on supply and demand<br />
changes, it is possible that consumers may develop<br />
perceptions of unfairness based on their own demand<br />
situations even without explicit exploitation actions from the<br />
seller. For example, when buyers feel that they have to buy a<br />
product and must bear whatever the price is, they may be<br />
concerned that potentially they could be exploited by the<br />
seller regardless whether the seller actually performs such<br />
actions.<br />
Relationship of fairness perceptions to satisfaction<br />
Recent research in marketing and psychology has shown that<br />
satisfaction is positively correlated with fairness perceptions<br />
(Bowman and Narayandas, 2001; Huffman and Cain, 2001;<br />
Kim and Mauborgne, 1996; Ord?n˜ ez et al., 2000; Smith et al.,<br />
1999). Oliver and Swan (1989a, b) found that customers’<br />
fairness perceptions depended on a supplier’s commitment<br />
and the quality of the goods and services relative to the price<br />
paid. Therefore, we propose that price perceptions influence<br />
The influence of price fairness on customer satisfaction<br />
Andreas Herrmann, Lan Xia, Kent B. Monroe and Frank Huber<br />
Journal of Product & Brand Management<br />
Volume 16 · Number 1 · 2007 · 49–58<br />
50<br />
consumers’ overall satisfaction judgments directly and<br />
indirectly through price fairness perceptions.<br />
In summary, there are various components of fairness<br />
perceptions and satisfaction judgments. The components of<br />
fairness perceptions are correlated with each other. And, the<br />
components of satisfaction are also correlated with each other.<br />
In any specific purchase process, the direction of influence<br />
between the components of price fairness depends on the<br />
order in which the information about price and terms of the<br />
offer is received by the buyers. Similarly, the direction of<br />
influence between the components of satisfaction depends on<br />
the sequence of the purchase process. In addition, specific<br />
factors that influence these constructs such as price fairness<br />
perceptions likely vary depending on the specific purchase<br />
context. Next, we develop specific testable hypotheses for<br />
these relationships within an automobile purchase context.<br />
Research context<br />
Buying a car was chosen for the study context for several<br />
reasons. First, buying a new car is an important decision for<br />
most consumers. Consumers’ perceived risk and uncertainty<br />
are likely to be relatively high. Prior research suggests that,<br />
when faced with performance or quality uncertainty,<br />
consumers are more likely to use price as a cue in forming<br />
performance expectations (Urbany et al., 1997). In addition,<br />
relatively high product prices enhance the likelihood that<br />
perceived price fairness may be an important issue. Therefore,<br />
this context provides us with an opportunity to examine the<br />
influence of price fairness perceptions on satisfaction<br />
judgments. Second, an automobile purchase is a complex<br />
process, involving price negotiation, interaction with service<br />
people, selection of different option packages for the car,<br />
signing a purchase contract, as well as the car delivery process.<br />
The purchase process usually is made up of a sequence of<br />
clearly distinguishable individual episodes typically occurring<br />
in a similar order for most auto buyers. These different events<br />
provide an opportunity to separate consumers’ satisfactions<br />
with different encounters within the entire purchase<br />
transaction procedure.<br />
We first conducted 50 informal interviews with prospective<br />
auto buyers as well as staff at several auto dealerships in<br />
Germany to understand the automobile purchase process.<br />
Based on these interviews, we developed a set of factors that<br />
influence price fairness perceptions as well as specific<br />
components within the purchase process that affect<br />
satisfaction judgments. Moreover, these interviews also<br />
enabled us to specify the direction of influences among the<br />
fairness components and the satisfaction components based<br />
on the temporal sequence of the purchase process, leading to<br />
the conceptual model (see Figure 1) that was tested<br />
empirically.<br />
Hypotheses<br />
In the model, we focus initially on the influence of consumers’<br />
perceptions of price and price fairness on their satisfaction<br />
judgments. First, we propose that perceptions of the product’s<br />
price have both a direct influence on satisfaction judgments as<br />
well as an indirect influence through price fairness<br />
perceptions. As previous research suggests, people form<br />
price fairness perceptions from both the offer and the<br />
procedure that lead to the offer. Hence, we consider<br />
consumers’ fairness perceptions for both the initial price<br />
offered and the various conditions and terms that are attached<br />
to the final price (i.e. procedure).<br />
Effects of price perceptions and price fairness<br />
Our interviews showed that car buyers indeed consider price<br />
an important factor in their purchase decisions. Specifically,<br />
consumers tend to consider the relative relationship between<br />
price and their expectations about the performance of the<br />
product they want to purchase (Voss et al., 1998). Hence, an<br />
initial price quote from the seller may be compared with a<br />
buyer’s previous experience or an expectation of an acceptable<br />
or fair price for the product. If buyers’ perceptions of<br />
performance or quality of the car exceed their expectations<br />
and the car represents good value for money, then their<br />
perceptions of the quoted or listed price should be favorable<br />
(Voss et al., 1998). Consequently, if buyers perceive that the<br />
benefits offered by the product relative to the perceived<br />
sacrifice (i.e. price to be paid) is favorable, then they will be<br />
more likely to perceive that the price is fair (Monroe, 2003):<br />
H1. Buyers’ price perceptions positively influence their<br />
perceptions of the fairness of price offers.<br />
In our interviews consumers frequently talked about their<br />
need for the car such as whether they can wait or they have a<br />
very short span of time to get the car. For example, their<br />
previous car may have broken down or they had an accident<br />
and needed to get a new car quickly. Consumers have some<br />
common knowledge that in a market economy prices are<br />
subject to variations in supply and demand. When demand<br />
increases relative to supply, sellers have an opportunity to<br />
raise prices and increase their profits. Therefore, when<br />
consumers need to purchase a car quickly and have few or no<br />
other options, they may feel more vulnerable due to the fear<br />
that the seller will take advantage of this opportunity to quote<br />
a higher price than in other situations regardless whether the<br />
seller actually takes such an action. The dual entitlement<br />
principle implies that such situations do influence buyers’<br />
price fairness perceptions, especially when buyers have no<br />
other alternatives (Kahneman et al., 1986; Kalapurakal et al.,<br />
1991). These initial interviews also revealed that the car<br />
buyers indicated they felt some anxiety at the initial stages of<br />
the buying process. Regardless of previous purchase<br />
experience, they felt some concern that they would not<br />
know whether the price would be reasonable for their<br />
situation. Hence, we propose that consumers’ feeling of<br />
vulnerability may contribute to their perceptions of price<br />
unfairness:<br />
H2. As consumers’ perceived vulnerability due to an urgent<br />
need and their immediate demand increases, their<br />
perceptions of price offer fairness will decrease, ceteris<br />
paribus.<br />
In terms of the influence between the two components of<br />
distributive and procedural fairness, we found that when<br />
buying an automobile, buyers typically receive an initial price<br />
offer from the dealer before they discuss specific options that<br />
they want and negotiate the final price and financial terms<br />
with the seller. The principles of distributive and procedural<br />
fairness suggest that price fairness judgments will be based on<br />
both the outcome (i.e. price) as well as information related to<br />
how the specific outcome was determined (i.e. procedure).<br />
Information on outcomes and procedures may interact and<br />
the order that the information is received influences<br />
The influence of price fairness on customer satisfaction<br />
Andreas Herrmann, Lan Xia, Kent B. Monroe and Frank Huber<br />
Journal of Product & Brand Management<br />
Volume 16 · Number 1 · 2007 · 49–58<br />
51<br />
perceptions of price fairness. Hence, for a typical car purchase<br />
process in Germany, we hypothesize an influence from<br />
perceived initial price offer fairness to perceived price<br />
procedure fairness:<br />
H3. Buyers’ perceptions of price offer fairness will have a<br />
positive effect on their perceptions of pricing procedure<br />
fairness.<br />
We propose that fairness and satisfaction are linked through<br />
product or service price. Previous research on satisfaction<br />
indicates that equity (e.g. perception of price fairness) has a<br />
major influence on satisfaction judgments. Since Szymanski<br />
and Henard (2001) have shown that equity has a dominant<br />
effect on satisfaction judgments we propose the direction of<br />
influence to be from price fairness to satisfaction:<br />
H4. Buyers’ perceptions of price offer fairness will have a<br />
positive effect on their overall satisfaction with the<br />
purchase.<br />
H5. Buyers’ perceptions of pricing procedure fairness will<br />
have a positive effect on their overall satisfaction with<br />
the purchase.<br />
In addition to influencing satisfaction judgments through<br />
fairness perceptions, price perceptions also directly influence<br />
satisfaction judgments (Voss et al., 1998). That is, consumers<br />
may also judge the price paid relative to the consistency of the<br />
performance of the product or service. When consumers<br />
compare their perceived gains or benefits of the transaction<br />
relative to their perceived monetary sacrifice and judge that<br />
their sacrifice is greater than the benefits derived from the<br />
product’s performance, consumers may be dissatisfied<br />
(Spreng et al., 1993):<br />
H6. Buyers’ price perceptions will have a positive effect on<br />
their overall satisfaction with the purchase.<br />
Effects of different components of satisfaction<br />
For a complex purchase situation, the overall judgment of<br />
satisfaction consists of various components including both<br />
satisfaction with the purchase process and satisfaction with<br />
the outcome. The interviews indicated that a major aspect of<br />
purchasing an automobile involves interactions with<br />
salespeople and other members of the dealer’s staff.<br />
Consumers rely on salespeople for specific information<br />
about the car to help them make an assessment. There are<br />
also opportunities to interact with individuals who handle the<br />
financial aspects of the purchase. Therefore, interaction with<br />
members of the dealer’s staff will have a direct influence on<br />
customer’s overall satisfaction judgments. Further, although<br />
buyers may have some general ideas about the quality of the<br />
car they are purchasing, product conditions upon delivery<br />
provide a direct opportunity for buyers to assess the quality of<br />
the car that they are actually buying (i.e. satisfaction with the<br />
outcome). Hence, satisfaction with the condition of the car<br />
upon delivery will have a positive effect on overall satisfaction<br />
judgments:<br />
H7. Buyers’ satisfaction with the dealer’s service will have a<br />
positive effect on their overall satisfaction with the<br />
purchase.<br />
H8. Buyer’s satisfaction with the condition of the car upon<br />
delivery will have a positive effect on their overall<br />
satisfaction with the purchase.<br />
We propose that satisfaction with one stage of the purchase<br />
process will have a positive influence on the satisfaction with<br />
other stages, especially when the purchase process occurs in a<br />
sequence. Within the car buying process, the initial<br />
information that buyers obtain is usually a price quote.<br />
Then they learn more about the pricing procedure. Next, they<br />
Figure 1 The conceptual model<br />
The influence of price fairness on customer satisfaction<br />
Andreas Herrmann, Lan Xia, Kent B. Monroe and Frank Huber<br />
Journal of Product & Brand Management<br />
Volume 16 · Number 1 · 2007 · 49–58<br />
52<br />
may develop some further impressions about the dealer based<br />
on their interactions with the dealer’s service people. Finally,<br />
they complete the transaction and obtain the car. This<br />
purchase sequence determines the direction of influence from<br />
one component of satisfaction to another.<br />
We have hypothesized that perceptions of initial price offer<br />
fairness have a positive effect on pricing procedure fairness.<br />
Obtaining information on pricing procedures and terms<br />
associated with a price quote is part of the interactions<br />
between the customers and the dealer’s employees. Therefore,<br />
consistent with the purchase sequence, we propose that:<br />
H9. Buyers’ perceptions of pricing procedure fairness will<br />
have a positive effect on their satisfaction with the<br />
dealer’s service.<br />
H10. Buyers’ satisfaction with the dealer’s service will have a<br />
positive effect on their satisfaction with the conditions<br />
of the car upon delivery.<br />
The study<br />
Pretest<br />
To start the actual study, 100 car owners who recently had<br />
bought a car from one of the dealerships of each of the five<br />
major German car brands (DaimlerChrysler, BMW,<br />
Volkswagen, Ford, Opel/GM) were interviewed by<br />
well-trained interviewers and averaged 30 minutes. Based on<br />
these interviews we refined our set of measurement items,<br />
compiling a list of 27 items to measure the constructs. The<br />
pretest also revealed that car buying is a highly involving task<br />
for consumers. Overall, the respondents were familiar with the<br />
car buying process and had some general knowledge about<br />
purchasing a car.<br />
Final survey<br />
After developing the measures, we obtained a list of customers<br />
who recently had bought a car from the dealerships. We<br />
contacted 460 customers both via mail and subsequent phone<br />
calls to solicit participation. Although no incentives were<br />
offered, 246 customers agreed to participate for a completion<br />
rate of 53.5 percent. A time was scheduled with each<br />
participant and the survey was administered face-to-face at<br />
the dealerships. Well-trained interviewers from a market<br />
research company administered the survey. To help<br />
respondents refresh their memories of their purchase<br />
experiences, the interviews followed the purchase sequence<br />
uncovered during the initial set of interviews that led to the<br />
model in Figure 1. Each session lasted about 30 minutes. The<br />
demographic characteristics of the buyers and distribution of<br />
the brand/model of cars purchased matched that of the New<br />
Car Buyer Study (Table I).<br />
Measures<br />
As summarized below, the respondents answered questions<br />
regarding their purchase experiences using seven-point scales<br />
ranging from “strongly disagree” to “strongly agree.” To select<br />
the final items for each construct, we used Cronbach’s alpha,<br />
item-to-total correlations, and exploratory factor analysis.<br />
Exploratory factor analysis indicated that the measures loaded<br />
on the correct factors and provided initial assessments of the<br />
discriminant and convergent validities of the measures. The<br />
final 20 items used are given in Table II and the construct<br />
correlation matrix is in Table III. As shown in Table III, 20 of<br />
the 21 inter-construct correlations are less than 0.50 and one<br />
is exactly 0.50, providing strong evidence of discriminant<br />
validity. Overall, the measures displayed very good convergent<br />
and discriminant validities.<br />
Perceived vulnerability<br />
Buyers are more likely to perceive a price is unfair when they<br />
feel vulnerable to possible exploitation by a seller. This<br />
vulnerability is more severe when buyers’ need for the product<br />
or service is urgent and they are limited by the availability of<br />
other alternatives. Using items from Cook and Emerson’s<br />
(1978) “feeling of vulnerability,” respondents were asked<br />
whether the car was absolutely required, and whether there<br />
were other transportation alternatives.<br />
Price perceptions<br />
We argue that buyers’ perceptions of a price are based on the<br />
relativity of price and the perceived performance or quality of<br />
the product as well as their comparisons with their<br />
expectations (Monroe, 2003; Voss et al., 1998). When<br />
buyers perceive the quality or performance is consistent<br />
with the price, their perceptions of the price will be favorable,<br />
enhancing a fair price perception. Similarly, when a price offer<br />
meets one’s expectation, the evaluation is likely to be positive.<br />
Table I Socio-demographic structure of the respondents<br />
NCBS Sample<br />
(%) (%)<br />
Gender<br />
Male 76.3 75.2<br />
Female 23.4 24.8<br />
Age<br />
<25 5.6 6.1<br />
23-49 55.8 56.1<br />
50-65 29.3 29.3<br />
>66 7.5 8.5<br />
Marital status<br />
Single or living alone 17.8 18.7<br />
Married or living together 82.2 81.3<br />
Persons living in house<br />
1 12.4 12.2<br />
2 40.2 40.6<br />
3 21.5 21.8<br />
4 18.8 17.9<br />
>5 7.1 7.3<br />
Education level<br />
Elementary school 8.5 7.7<br />
Middle school 28.0 28.1<br />
High school 32.5 30.9<br />
College 8.4 9.7<br />
University 22.7 23.6<br />
Residence<br />
City 27.0 26.8<br />
Town 40.7 41.9<br />
Village 24.0 24.0<br />
Country 8.3 7.3<br />
Note: The demographic structure of the study corresponds with the new car<br />
buyer study (NCBS) (German)<br />
The influence of price fairness on customer satisfaction<br />
Andreas Herrmann, Lan Xia, Kent B. Monroe and Frank Huber<br />
Journal of Product & Brand Management<br />
Volume 16 · Number 1 · 2007 · 49–58<br />
53<br />
Therefore, price perceptions were measured using: the price<br />
of the new car is appropriate relative to its performance; the<br />
price of the new car meets my expectations; and the car is<br />
good value for money comparing to other cars.<br />
Perceived price offer fairness<br />
Since our research is in the specific context of automobile<br />
purchases, we developed our own price offer fairness<br />
measures drawing on literature sources related to procedural<br />
fairness. We emphasized equality of treatment across buyers<br />
(Xia et al., 2004), the degree that buyers understood how the<br />
price offer was determined (Kim and Mauborgne, 1996), and<br />
the responding buyers’ perceptions of the relationship<br />
between their needs and the price quoted by the dealer<br />
(Oliver and Swan, 1989b). The German word gerecht<br />
meaning fair and just was used to measure fairness<br />
perceptions. Also, research indicates that a cost-based<br />
pricing strategy is perceived to be fairer (Kalapurakal et al.,<br />
1991). Therefore, perceived price offer fairness was measured<br />
using: the price offer of the dealer is understandable; all<br />
customers are treated equally by the dealer; the price of this<br />
Table II Scale items and measurement properties<br />
Scale items by construct t-value<br />
Item<br />
reliability<br />
Construct<br />
reliability<br />
Variance<br />
extracted Alpha<br />
Price perception 0.55 0.80 0.80<br />
The price of the new car is appropriate relative to its performance 22.53 0.53<br />
The price of the new car meets my expectations 24.28 0.69<br />
The price of the new car is good value for money comparing to other cars 22.12 0.49<br />
Buyer vulnerability 0.71 0.86 r ¼ 0:71<br />
The car is absolutely required for private or business use 19.21 0.79<br />
It is not possible for me to use other means of transportation 19.32 0.64<br />
Price offer fairness 0.51 0.84 0.95<br />
The price of the new car of this dealer is clear understandable) 16.24 0.57<br />
All customers are treated equally by the dealer’s pricing 22.08 0.45<br />
I think the price of this dealer is based on cost 15.34 0.43<br />
The price of the car is independent of customer’s needs 15.23 0.60<br />
Pricing procedure fairness 0.30 0.79 r ¼ 0:85<br />
The terms of this dealer are fair 20.25 0.34<br />
The procedure of buying the car from the dealer is fair 9.07 0.26<br />
Satisfaction with the dealer’s service 0.57 0.78 0.93<br />
The dealer’s employees are friendly 19.21 0.67<br />
The dealer offers a lot of accessories 15.79 0.60<br />
I am satisfied with the information that was provided by the employees 14.95 0.54<br />
I am satisfied with the dealer’s commitment 15.16 0.51<br />
Satisfaction with the car upon delivery 0.53 0.78 0.77<br />
The car was in perfect condition when it was delivered 9.32 0.50<br />
All option requests were fulfilled 14.57 0.67<br />
The car is the same as my expectations 9.01 0.44<br />
Satisfaction with the purchase 0.56 0.86 r ¼ 0:55<br />
I am satisfied with the car purchase 14.43 0.68<br />
There is no reason to complain 12.36 0.45<br />
Table III Construct and inter-construct correlations<br />
Price<br />
perception<br />
Buyer<br />
vulnerability<br />
Price<br />
offer<br />
fairness<br />
Price<br />
procedure<br />
fairness<br />
Satisfaction with<br />
dealer’s service<br />
Satisfaction<br />
with car<br />
Satisfaction<br />
with purchase<br />
Price perception 0.57<br />
Buyer vulnerability 0.35 0.71<br />
Price offer fairness 0.32 0.23 0.76<br />
Price procedure fairness 0.44 0.37 0.14 0.85<br />
Satisfaction with dealer’s service 0.26 0.23 0.24 0.14 0.68<br />
Satisfaction with car 0.23 0.24 0.20 0.20 0.12 0.53<br />
Satisfaction with purchase 0.40 0.38 0.46 0.37 0.50 0.34 0.55<br />
The influence of price fairness on customer satisfaction<br />
Andreas Herrmann, Lan Xia, Kent B. Monroe and Frank Huber<br />
Journal of Product & Brand Management<br />
Volume 16 · Number 1 · 2007 · 49–58<br />
54<br />
dealer is based on cost; and the price of the car is not affected<br />
by the individual customer’s needs.<br />
Pricing procedure fairness<br />
Research on procedural fairness suggests that the procedure<br />
of setting the price, in addition to the price itself would<br />
influence buyers’ fairness perceptions. For a car purchase, a<br />
price is a combination of several elements and carries with it<br />
various terms and conditions. Therefore, how these terms and<br />
the price setting procedures were explained to and accepted<br />
by the buyers were measured using two items: the terms of the<br />
dealer are fair; and the procedure of buying a car from the<br />
deal was fair.<br />
Satisfaction with the dealer’s service<br />
The measures used for this construct were based on the<br />
various interactions that the buyers had with the dealer<br />
including the friendliness of the staff, the impression obtained<br />
when purchasing accessories, satisfaction with the<br />
information provided by the dealer, and satisfaction with the<br />
dealer’s general commitment (Burmann, 1991; Ostrom and<br />
Spreng et al., 1996).<br />
Satisfaction with the car upon delivery<br />
This aspect of satisfaction was measured by obtaining buyers’<br />
perceptions of the car relative to their expectations, the<br />
condition of the car when it was delivered, and whether all<br />
options or features of the car that the buyers requested had<br />
been met.<br />
Overall satisfaction<br />
Two items were used for this construct: overall satisfaction<br />
with the purchase and intention to complain.<br />
Measurement properties of the scales<br />
Using exploratory and confirmatory factor analyses, the<br />
measurement model was assessed for the dimensionality of<br />
the scales, their reliability and the construct validity of the<br />
measures. Item reliability, construct reliability, and variance<br />
extracted of the items are shown in Table II. A single-factor<br />
confirmatory factor analysis (WLS estimate) was conducted<br />
to further check scale reliability and validity. The<br />
confirmatory assessment of the measurement properties of<br />
all four scales with at least three items indicated that the<br />
confirmatory factor loadings (lambdas) were high and<br />
significant (p , 0:001), satisfying the criteria for convergent<br />
validity. Moreover, Cronbach’s alpha for these four scales was<br />
0.77 or higher, indicating adequate reliability.<br />
Except for perceived price offer fairness, all construct<br />
reliabilities were greater than 0.50. The variances extracted<br />
were greater than 0.75. These two assessments exceed the<br />
established minimum criteria (Fornell and Larcker, 1981). All<br />
t-values shown in Table II were statistically significant,<br />
providing evidence of convergent validity of the measures<br />
(Fornell et al., 1982). The M2 measure developed by Fornell<br />
et al. (1982) had a value of 0.46 which is above the required<br />
threshold of 0.40. All inter-construct correlations were 0.50<br />
or less, indicating the measures had discriminant validity. The<br />
squared correlation coefficients of each latent variable with<br />
relevant others was smaller than the average variance recorded<br />
in 31 of 42 possible comparisons, providing more evidence of<br />
discriminant validity.<br />
Evaluating the structural model<br />
The structural model (Figure 2) was tested using LISREL 8.3<br />
(Jo¨reskog and So¨rbom, 1996). PRELIS was used to generate<br />
the input matrix. Analysis was conducted separately for an<br />
exogenous model that included the exogenous constructs and<br />
their indicators and an (endogenous model that included the<br />
endogenous constructs and their indicators). To test the<br />
absolute fit of each of these two models, the goodness of fit<br />
index (GFI) was 0.99 (0.98) and the adjusted goodness of fit<br />
index (AGFI) was 0.98 (0.96). Thus, the goodness of fit<br />
indices were well above the minimum criterion values of 0.90.<br />
For the full model, the root mean square error of<br />
approximation (RMSEA) was 0.043 for both models, which<br />
is below the recommended upper threshold of 0.08. These<br />
indices clearly indicate a good absolute fit to the data<br />
(Jo¨reskog and So¨rbom, 1996).<br />
Testing the comparative fit of the two models, the normed<br />
fit index (NFI) (Bentler and Bonett, 1980) was 0.98 (0.97),<br />
also exceeding the suggested criterion value of 0.90. The<br />
comparative fit index (CFI) of 0.99 (0.99) exceeded the<br />
criterion value of 0.90 (Bentler, 1990). The incremental fit<br />
index (IFI) was 0.98 (0.97), again indicating a good fit.<br />
Alternative model configurations were considered, but as<br />
these indices indicate, improvements in fit could not be<br />
obtained by any alternative configurations.<br />
Test of the hypotheses<br />
The standardized estimates for the various model paths for<br />
the study are shown in Table IV along with the results of the<br />
hypotheses tests according to the sequence of paths depicted<br />
in Figure 2. As hypothesized, respondents’ perceptions of<br />
price offer fairness were positively influenced by their price<br />
perceptions (b ¼ 0:64, t ¼ 14:62, p ¼ 0:04, supporting H1),<br />
and negatively influenced by their perceived vulnerability<br />
(b ¼ 20:21, t ¼ 4:63, p ¼ 0:05, supporting H2). When<br />
buyers perceive that the price offer is consistent with or<br />
exceeds their expectations about the car’s perceived quality or<br />
performance, they are more likely to perceive the price offer as<br />
fair. Further, an increase in buyers’ need and demand<br />
enhances a feeling of vulnerability, which, ceteris paribus,<br />
increased their concern as to whether the price offered by the<br />
dealer was fair, producing a negative effect. Thus, our results<br />
complement past research results (Kahneman et al., 1986;<br />
Maxwell, 1995). Moreover, price perceptions also exerted a<br />
small direct influence on overall satisfaction with the purchase<br />
(b ¼ 0:15, t ¼ 1:95, p ¼ 0:09). We also ran the model without<br />
the direct effect of price perceptions and compared it with the<br />
hypothesized model. The difference was significant<br />
(x2 ¼ 66:97, p , 0:01) so we kept the path. The combined<br />
direct and indirect effect of price perceptions on overall<br />
satisfaction with the purchase is 0.48. Thus, these results<br />
support our argument that price perceptions have a major<br />
influence on overall customer satisfaction (see also Singh and<br />
Sirdeshmukh, 2000; Voss et al., 1998).<br />
We hypothesized (H3) that perceived price offer fairness has<br />
a positive effect on perceived pricing procedure fairness since<br />
car buyers are more likely to obtain an initial price offer before<br />
a final price is negotiated. The initial perceptions of the<br />
fairness of the offer are likely to influence perceptions of price<br />
procedure fairness (van den Bos et al., 1997). This<br />
relationship was supported (b ¼ 0:89, t ¼ 17:78, p ¼ 0:05).<br />
Regarding the relationship between fairness and<br />
satisfaction, we hypothesized that perceived price offer<br />
The influence of price fairness on customer satisfaction<br />
Andreas Herrmann, Lan Xia, Kent B. Monroe and Frank Huber<br />
Journal of Product & Brand Management<br />
Volume 16 · Number 1 · 2007 · 49–58<br />
55<br />
fairness (H4) and perceived pricing procedure fairness (H5)<br />
have positive effects on buyers’ overall satisfaction judgments.<br />
These propositions are supported by a direct effect of price<br />
offer fairness (b ¼ 0:22, t ¼ 2:53, p ¼ 0:04) and a direct effect<br />
of pricing procedure fairness (b ¼ 0:32, t ¼ 2:56, p ¼ 0:05).<br />
The combined effect of price offer fairness perceptions on<br />
overall satisfaction judgments, including the direct effect and<br />
the indirect effect through price procedure fairness, is 0.77.<br />
The results indicated that both satisfaction with the dealer’s<br />
service (b ¼ 0:36, t ¼ 4:06, p ¼ 0:09, H7) and satisfaction<br />
with the conditions of the car upon delivery (b ¼ 0:30,<br />
t ¼ 5:02, p ¼ 0:06, H8) positively influence overall<br />
satisfaction. Also, buyers’ perceptions of pricing procedure<br />
fairness positively influenced the respondents’ satisfaction<br />
with the dealer’s service (b ¼ 0:61, t ¼ 10:3, p ¼ 0:06, H9).<br />
Finally, satisfaction with the dealer’s service had a positive<br />
effect on satisfaction with the condition of the car upon<br />
delivery (b ¼ 0:44, t ¼ 12:97, p ¼ 0:03, H10). Overall, the<br />
results indicate that buyers’ satisfaction with an automobile<br />
purchase is influenced by their price fairness perceptions as<br />
well as their satisfaction with various transactions that occur<br />
during their purchase process.<br />
Discussion<br />
Our research contributes to the literature on satisfaction by<br />
incorporating the role of perceived price fairness. Price is an<br />
important element in consumers’ purchases; therefore it has a<br />
large influence on consumers’ satisfaction judgments. The<br />
results showed that price perceptions directly influence<br />
satisfaction judgments as well as indirectly through<br />
Figure 2 Effects of price fairness on customer satisfaction<br />
Table IV Testing the model (Figure 2) relationships<br />
From To Sign Standardized relationship estimate t-value p-value<br />
Perceived vulnerability Price offer fairness 2 20.21 4.63 0.05<br />
Price perceptions Price offer fairness þ 0.64 14.62 0.04<br />
Price offer fairness Pricing procedure fairness þ 0.89 17.78 0.05<br />
Pricing procedure fairness Satisfaction with dealer’s service þ 0.61 10.30 0.06<br />
Satisfaction with dealer’s service Satisfaction with car þ 0.44 12.97 0.03<br />
Satisfaction with car Satisfaction with purchase þ 0.30 5.02 0.06<br />
Price perceptions Satisfaction with purchase þ 0.15 1.95 0.09<br />
Price offer fairness Satisfaction with purchase þ 0.22 2.53 0.04<br />
Pricing procedure fairness Satisfaction with purchase þ 0.32 2.56 0.05<br />
Satisfaction with dealer’s service Satisfaction with purchase þ 0.36 4.06 0.09<br />
The influence of price fairness on customer satisfaction<br />
Andreas Herrmann, Lan Xia, Kent B. Monroe and Frank Huber<br />
Journal of Product & Brand Management<br />
Volume 16 · Number 1 · 2007 · 49–58<br />
56<br />
perceptions of price fairness. Our research has linked these<br />
two important concepts and demonstrated the influence of<br />
perceived price fairness on satisfaction judgments empirically.<br />
Further, we have extended research relative to the influence<br />
of demand-supply relationships on price fairness perceptions<br />
by examining the demand side perceptions (i.e., consumer<br />
vulnerability) without actual supply side actions. Results<br />
indicate that consumers’ perceived vulnerability, which is<br />
induced by a perceived urgency of need by the consumers,<br />
had a negative effect on perceived price offer fairness. The<br />
results extend the dual entitlement principle and imply that<br />
sellers should not only avoid exploiting their customers but<br />
should also anticipate consumers’ potential feelings of being<br />
exploited. Being sensitive to the buyers’ psychological state<br />
and assuring buyers of fair treatment will enhance perceptions<br />
of price fairness without changing the price offer. When<br />
buyers are relaxed relative to their feelings of vulnerability,<br />
price fairness perceptions will be higher, thereby enhancing<br />
satisfaction judgments.<br />
However, we did not measure respondents’ prior<br />
relationship with the dealerships. Presumably, a good<br />
existing relationship with the dealerships may serve as a<br />
“safety net” that consumers may use to reduce their feelings<br />
of vulnerability. In addition, the felt vulnerability within our<br />
study context may also be due to the respondents’ high<br />
involvement with the purchase. Hence, future research should<br />
examine when consumer vulnerability would occur as well as<br />
its impact on perceptions of fairness and satisfaction across<br />
different levels of prior experience or relationship with the<br />
seller. By manipulating vulnerability and prior experience<br />
with the seller, we might expect that the effects of<br />
vulnerability on price perceptions would be attenuated when<br />
the prior relationship with the dealer is satisfactory (Homburg<br />
et al., 2005). Conversely, when perceived vulnerability is high<br />
and the buyer has no prior experience with the dealer, the<br />
negative effects on price perceptions we observed in this study<br />
would be more substantial. Results from such future research<br />
would offer additional guidelines for sellers to anticipate and<br />
handle consumer vulnerability.<br />
Second, both the price offer and the procedure used to<br />
develop a price are important in influencing satisfaction<br />
judgments. In complex purchases such as an automobile,<br />
consumers need to understand the procedure for setting the<br />
price and terms and conditions related to a price in order to<br />
make a judgment about the price offered. Therefore,<br />
explaining this procedure and offering such information to<br />
consumers will enhance the transparency of the price and<br />
perceived fairness, further positively influencing satisfaction<br />
judgments. This price transparency may be particularly<br />
relevant when prices are increased or when the price<br />
structure is relatively complex. When a seller explains how a<br />
price is derived and shows that price increases are due to<br />
uncontrollable external factors such as an increase in raw<br />
material prices, the buyer is more likely to accept the price<br />
increase and perceive it fair or at least as less unfair<br />
(Vaidyanathan and Aggarwal, 2003; Xia et al., 2004).<br />
Third, consistent with previous research, we showed that<br />
overall judgments of satisfaction are influenced by consumers’<br />
satisfaction with various stages in a purchase process. In the<br />
context of automobile purchases, overall judgments of<br />
satisfaction were determined by satisfaction with the dealer’s<br />
service and satisfaction with the conditions of the product<br />
upon delivery in addition to perceptions of price fairness.<br />
These elements are correlated but distinct components of<br />
overall satisfaction judgments. By partitioning satisfaction<br />
into several distinct components, sellers can determine which<br />
component influences satisfaction at the various stages of the<br />
purchase process. Hence, a better understanding of<br />
consumers’ satisfaction formation will increase our<br />
knowledge of how to enhance consumers’ satisfaction.<br />
This research linking perceived price fairness and customer<br />
satisfaction was examined in an automobile purchase context.<br />
Nevertheless, we believe the results reported in this article can<br />
be generalized to other consumer purchases of relatively highpriced<br />
products and complex purchase processes involving<br />
multiple interactions with the sellers’ employees. However,<br />
whether and how the relationship between price fairness and<br />
customer satisfaction extends to other product and service<br />
purchase contexts needs to be examined. Further, as we<br />
suggested, the direction of influence among the components<br />
of fairness perceptions and satisfaction judgments depends on<br />
the sequence of interactions within the purchase process and<br />
the order that consumers receive relevant information. Hence,<br />
another area needing additional research is when consumers<br />
first receive information about the pricing procedure as well as<br />
the price offer itself.<br />
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Volume 16 · Number 1 · 2007 · 49–58<br />
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About the authors<br />
Andreas Herrmann is Professor of Media and<br />
Communications Management at the University of St<br />
Gallen, Switzerland.<br />
Lan Xia is Assistant Professor, Marketing Department,<br />
Bentley College, Waltham, Massachusetts, USA. Lan Xia is<br />
the corresponding author and can be contacted at:<br />
lxia@bentley.edu<br />
Kent B. Monroe is J.M. Jones Distinguished Professor of<br />
Marketing Emeritus, University of Illinois, and Distinguished<br />
Visiting Scholar, University of Richmond, Glen Allen,<br />
Virginia, USA.<br />
Frank Huber is Professor of Marketing at the University of<br />
Mainz, Germany.<br />
The influence of price fairness on customer satisfaction<br />
Andreas Herrmann, Lan Xia, Kent B. Monroe and Frank Huber<br />
Journal of Product & Brand Management<br />
Volume 16 · Number 1 · 2007 · 49–58<br />
58<br />
To purchase reprints of this article please e-mail: reprints@emeraldinsight.com<br />
Or visit our web site for further details: www.emeraldinsight.com/reprintsNurazreen FYPhttp://www.blogger.com/profile/03307336878903933160noreply@blogger.com0tag:blogger.com,1999:blog-7036304423786647550.post-26160996902861143512011-10-29T05:48:00.000-07:002011-10-29T05:48:25.840-07:00chapter 1<div align="center" class="MsoNormal" style="text-align: center;"><b style="mso-bidi-font-weight: normal;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">CHAPTER 1<o:p></o:p></span></b></div><div align="center" class="MsoNormal" style="text-align: center;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">INTRODUCTION<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">This chapter explains about the definition of the research which includes the research background,problem statement,aim,objective and significance of research. The research definition is elaborated because a definition shall give a brief description on the whole idea of the research.<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><br />
</div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">1.1 <span style="mso-tab-count: 1;"> </span>Research Background<o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">In terms of making decision to purchase a car,many aspects need to be considered. However,selecting a suitable car is often done in an unplanned manner.Making decision in purchasing a car is an important aspect since a lot of criteria needs to be taken into account. Currently, there are a lot of specification would be demanded by car buyers to purchase their<span style="mso-spacerun: yes;"> </span>dream car. This sort of decision have a major impact in their life. Customers will satisfied if they purchase their car rightly that includes their<span style="mso-spacerun: yes;"> </span>budget and they will feel frustrated and get a little stress if they purchase wrong car. Therefore, in order for them to make a<span style="mso-spacerun: yes;"> </span>right decision there should be a suitable pattern that will help and guide them as a customers to purchase a car. The pattern also can acts as a guidelines for them and will recommend the ideal car that suit all the specification that customers prefer around their budget. This research<span style="mso-spacerun: yes;"> </span>will demostrates the use of rule-based method to produce pattern that will recommend ideal car. Respondents involved in this study were the automobile companies for PROTON and PERODUA also the customers. <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">Data mining is<span style="mso-spacerun: yes;"> </span>one of the best ways to extract meaningful trends and patterns from huge amounts of data. Data mining discovers within data warehouses information that queries and reports cannot effectively reveal. There are numerous definitions of what data mining is, ranging from the broadest definitions of any tool that enables users to access directly large amounts of data to more specific definitions such as tools and applications that perform statistical analysis on the data. In this chapter, we use more focused definition of data mining by Simoudis (1996).</span><span style="background: white; color: #333333; font-family: "Verdana","sans-serif"; font-size: 7.0pt; line-height: 115%;"> <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span class="apple-style-span"><span style="background: white; font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">Data mining involves the exploration and analysis of large databases to find patterns and valuable information that can aid in decision making.This research used the rule-based method to recommend ideal car to customers. </span></span><span style="color: black; font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">In rule-based classification, group documents together, decide on categories, and formulate the rules that define those categories; these rules are actually query phrases. Then index the rules and use the<span class="apple-converted-space"> </span><code><span style="font-family: "Times New Roman","serif"; line-height: 115%; mso-ansi-font-size: 12.0pt; mso-bidi-font-size: 12.0pt; mso-fareast-font-family: Calibri; mso-fareast-theme-font: minor-latin;">MATCHES</span></code><span class="apple-converted-space"> </span>operator to classify documents. </span><span class="apple-style-span"><span style="background: white; font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">This research illustrates the use of data mining approach to build predictive pattern for predicting customer's intent of purchasing car<span style="color: #333333;">.</span></span></span><span class="apple-style-span"><span style="background: white; color: #333333; font-family: "Verdana","sans-serif"; font-size: 7.0pt; line-height: 115%;"> <o:p></o:p></span></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><br />
</div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><br />
</div><div class="MsoNormal"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">1.2<span style="mso-tab-count: 1;"> </span>Problem Statement<o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">Decision for purchasing a car is a major factor that can affect our life. There are many factor can influence customers while they have made decision to purchase a car. Currently, every customer have their own specification and interest when looking something to buy for example buying a house, furniture, including a car. Car is an important thing in our life because we need a transport to move to another place. The problem that encounter during this research is when deciding to buy a car many customers experience anxiety because it is a big ticket item that is purchased only occasionally.<span style="mso-spacerun: yes;"> </span>Often, the purchasing process involves negotiating with a salesperson or<span style="mso-spacerun: yes;"> </span>dealer whom the customer perceives as having negotiating advantages (such as better information, leverage and negotiation skills).<span style="mso-spacerun: yes;"> </span>It is a purchase made seriously as a commitment to years of future car payments, taxes, maintenance and operating costs.<span style="mso-spacerun: yes;"> </span>Most will also spend a lot of time in the vehicle they buy.<span style="mso-spacerun: yes;"> </span>Because of these high economic and social stakes, levels of stress can be high.</span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">Besides that, the customers always ignore their specification when selecting a suitable car for them. After driving a car for a few years, they tend to feel like frustration with their car. This happens because of time consuming a car will affect the quality of car. So, there should be a right pattern in order to help the customers in making a right decision that can benefit them in future use. <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">Other that that is, there is a need to improve decision making among customers for purchasing car by implementing classification data mining techniques. Therefore, this research is conducted to predict about the pattern on decision making for purchasing car. <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><br />
</div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">1.3<span style="mso-tab-count: 1;"> </span>Project Aim<o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To produce rule-based method classification that able to describe pattern of car purchasing for customers that act as a guideline for them to buy the best car and make a valuable decision with respect to their capability (in terms of budgeting).<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><br />
</div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">1.4 <span style="mso-tab-count: 1;"> </span>Project Objectives<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><span style="mso-spacerun: yes;"> </span><span style="mso-tab-count: 1;"> </span>This project is implemented in order to achieve several objectives.The objectives of <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify; text-indent: 36.0pt;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">this project are as follows:<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><span style="mso-tab-count: 1;"> </span>1) To identify patterns of purchasing car among customers at the automobile <o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><span style="mso-spacerun: yes;"> </span>companies such as PROTON, and PERODUA.<o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">2) To determine what is the highest specification among customers who wants to buy<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><span style="mso-spacerun: yes;"> </span>a car.<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><span style="mso-tab-count: 1;"> </span>3) To make the best decision especially for the customers while they want to buy<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><span style="mso-spacerun: yes;"> </span><span style="mso-spacerun: yes;"> </span>a car according to their interested specification (criteria) .<span style="mso-tab-count: 1;"> </span><o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><span style="mso-tab-count: 1;"> </span>4) To recommend the ideal car of the customer pattern.<o:p></o:p></span></div><div class="MsoNormal" style="text-align: justify;"><br />
</div><div class="MsoNormal" style="text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">1.5<span style="mso-tab-count: 1;"> </span>Project Scope<o:p></o:p></span></div><div class="MsoNormal" style="margin-bottom: .0001pt; margin-bottom: 0cm; margin-left: 36.0pt; margin-right: 0cm; margin-top: 0cm; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">The scope of this research is focusing on the pattern of decision making in purchasing car based on the rule-based method that include in data mining.The scope of this research also involves the automobile companies such as PROTON, and PERODUA by using data gathering techniques through interview and also customers refer to car buyer through survey questions that I have constructed. The deliverables (software tool) of this project will be use by the customers to recommend what the ideal car they should buy according to their specification of car also the automobile companies who like to predict the number of car highly demanded by the customers to be manufactured. The pattern produce <span style="mso-spacerun: yes;"> </span>will<span style="mso-spacerun: yes;"> </span>recommend the ideal car of the customer interest.<o:p></o:p></span></div><div class="MsoNormal" style="margin-bottom: .0001pt; margin-bottom: 0cm; margin-left: 36.0pt; margin-right: 0cm; margin-top: 0cm; text-align: justify;"><br />
</div><div class="MsoNormal" style="margin-bottom: .0001pt; margin-bottom: 0cm;"><br />
</div><div class="MsoNormal"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">1.6<span style="mso-tab-count: 1;"> </span>Significance of research<o:p></o:p></span></div><div class="MsoNormal" style="line-height: normal;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt;"><span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div><div class="MsoNormal" style="line-height: normal;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt;"><span style="mso-tab-count: 1;"> </span>The significance of the research are:<o:p></o:p></span></div><div class="MsoListParagraphCxSpFirst" style="margin-left: 72.0pt; mso-add-space: auto; mso-list: l3 level1 lfo1; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%; mso-fareast-font-family: "Times New Roman";"><span style="mso-list: Ignore;">A.<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To student :<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l1 level1 lfo2; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To gain and improve knowledge in data mining subject (ITS 665)<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l1 level1 lfo2; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To discover pattern for purchasing car from data collection<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l1 level1 lfo2; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To analyze customer specification to buy a car<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l1 level1 lfo2; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To gather information using data gathering technique by conducting interview with the automobile companies (PROTON and PERODUA).<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l1 level1 lfo2; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-GB" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%; mso-ansi-language: EN-GB;">To increase the comprehensibility of the knowledge patterns</span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;"><o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto;"><br />
</div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 72.0pt; mso-add-space: auto; mso-list: l3 level1 lfo1; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%; mso-fareast-font-family: "Times New Roman";"><span style="mso-list: Ignore;">B.<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To automobile company:<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l2 level1 lfo3; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To increase company profit<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l2 level1 lfo3; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To satisfy customer requirement (specification) of car <o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l2 level1 lfo3; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To reduce amount of company lost<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l2 level1 lfo3; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; font-size: 12.0pt; line-height: 115%; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To reduce customer complaints<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto;"><br />
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</div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 72.0pt; mso-add-space: auto; mso-list: l3 level1 lfo1; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%; mso-fareast-font-family: "Times New Roman";"><span style="mso-list: Ignore;">C.<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To customer:<o:p></o:p></span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l0 level1 lfo4; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To get preliminary perception (idea) about what kind of car suit to them</span></div><div class="MsoListParagraphCxSpMiddle" style="margin-left: 108.0pt; mso-add-space: auto; mso-list: l0 level1 lfo4; text-indent: -18.0pt;"><span lang="EN-US" style="font-family: Symbol; mso-bidi-font-family: Symbol; mso-fareast-font-family: Symbol;"><span style="mso-list: Ignore;">·<span style="font: 7.0pt "Times New Roman";"> </span></span></span><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">To make a right decision when purchasing car</span></div><div class="MsoListParagraphCxSpLast" style="margin-left: 108.0pt; mso-add-space: auto;"><br />
</div><div class="MsoNormal"><span lang="EN-US" style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%; mso-ansi-language: EN-US; mso-fareast-font-family: Perpetua;">1.7<span style="mso-tab-count: 1;"> </span>Conclusion</span><span lang="EN-US" style="font-family: "Perpetua","serif"; mso-ansi-language: EN-US; mso-fareast-font-family: Perpetua;"> <o:p></o:p></span></div><div class="MsoNormal" style="margin-left: 36.0pt; tab-stops: 45.0pt; text-align: justify;"><span style="font-family: "Times New Roman","serif"; font-size: 12.0pt; line-height: 115%;">This chapter give a brief description about the pattern of decision making in purchasing car that based on the data mining techniques that is the rule-based methods.It gives significance benefit especially to the automobile companies to manufacture highly demanded cars by the customers also the customers can make the valuable decision according to their interest criteria for purchasing car.The research background , problem statement, aim, objectives, scope and significance have been clearly defined. Hopefully,this project will give benefits for both automobile companies and customers.<o:p></o:p></span></div>Nurazreen FYPhttp://www.blogger.com/profile/03307336878903933160noreply@blogger.com0