Research Article | Open Access | 10.31586/marketing.0501.02

Studying the Impact of Marketing Mix on the Customers’ Satisfaction of Tabriz Iran Khodro Company

Abstract

the aim of present research study, is to investigate impact of marketing mix on the customers’ satisfaction. Present research is among applied researches and its method is descriptive and among descriptive researches, it is of correlation type. Using Alpha Cronbach test, reliability of the questioner was obtained 93% for Tabriz Iran Khodro Company. According to the Kolmogrov-Smirnoff test results, all variables enjoy normal place. According to Pearson Correlation test results, there is a positive and significant relationship among customer’s satisfaction and place, promotion, product and price elements. According to multiple regression test results, direct effect of place factor is 82%, promotion element 77%, product element 68% and direct effect of price element is 55% in prediction of the customer’s satisfaction. From among indexes of place element, spatial place of the representatives, from among indexes of promotion element, having towing and roadside assistance, from among indexes of the product element, warranty period and from among indexes of price element special sales for different occasions played the key role in the customers’ satisfaction.

1. Introduction

In the modern competitive world, customers are at the center of attention for different companies and their satisfaction is the key factor in obtaining competitive advantage for organizations. The main necessity for attracting the customers’ satisfaction is complete meeting of their needs and accurate investigation of their demands, expectations, tendencies, abilities and limitations in purchasing the products [1]. Customer satisfaction has a positive effect on customer loyalty. The finding also shows that product, promotion, location and price have had positive effects on customer loyalty through customer satisfaction with small and medium-sized food and beverage companies in Malaysia. Product, promotion, location, price and customer satisfaction affect customer loyalty by about 61.7% [2]. Customer’s satisfaction and providing necessary services, are the most important modern issues in the field of parts production and car manufacturing industries. Satisfied customer causes survival and durability of the manufacturing companies and meeting his need is the main goal of every production unit [3]. Customer loyalty also increases frequent purchases and generates higher revenue for the company. Therefore, customer loyalty is the customer behavior that always makes frequent purchases for the company's products after evaluating the products and feeling satisfied with it [4]. Product quality brings satisfaction, increases competitive advantage, and attracts potential customers. By variable we mean product marketing mix, ideas such as innovative services and value-added services in a company. Customers were satisfied with the quality experience. And increasing the marketing mix means the product significantly increases customer satisfaction. Previous studies also show that this product has a positive effect on customer satisfaction [5]. Marketing mix is one of the most important indexes of decision making and evaluations related to marketing of a business, because marketing mix or combined marketing strategy is one of the necessary elements of planning and implementation of all marketing operations. On the other hand, marketing mix elements are controllable and in interactive relation with each other. Making decision about one of them influences activities of other elements. If marketing mix elements are combined in an effective way, so that they both meet the consumers’ needs and are compatible with the environmental forces of the total selected market, then they will result in a successful marketing system. In fact, the concept of marketing mix determines the organization’s performance path, using series of controllable variables in the environment, which have lots of incontrollable factors (foreign market) [6]. On the other hand, globalization and membership at the world trading organization, are among the main current challenges of Iranian economy and its industry. Meanwhile, one of the most controversial industries is car manufacturing industry. Some theoreticians believe that the relative advantage of the industry is more doubted compared to other industries. Relatively lower quality of the cars produced in the country leads the globalization process to destroy the industry like a terrible hurricane. Product defined as "a physical product or service to a consumer that the consumer is willing to pay for. This includes half of material goods, such as furniture, clothing, foodstuffs and intangibles, which means that it is a service. "Products are created by the company to meet the needs and wants of the customer." These days, most companies need to create innovative products that fit the needs of the customer [7]. Under such a condition, the most important strong point of the Iranian car manufacturers, compared to the foreign competitors, is familiarity with the local market. Such an advantage, naturally, enjoys Iranian car manufacturers of the higher potential and capability of identification of needs and the customers’ demands. Such a better identification of the local market, helps Iranian car manufacturers to transfer their relative advantages and strong points to all latent aspects of the market. In fact, considering identification of the market and familiarity with different aspects of it, local car manufacturing companies find the opportunity to attract their potential and actual customers’ trust through providing appropriate after sale services at the qualitative and quantitative aspects or through proper spatial place [8].

Present research objective are as follows:

- studying impacts of marketing mix elements (i.e. place, promotion, product, price) on the customers’ satisfaction in Tabriz Iran Khodro Co.

The research questions of the present study are as follows:

- Do marketing mix elements (i.e. place, promotion, product, price) impact the customers’ satisfaction?

Present research hypotheses were developed as follows:

- Marketing mix elements (i.e. place, promotion, product, price) impact the customers’ satisfaction.

Present research variables were developed as follows:

Independent variables: in this research place, promotion, product and price elements were considered as independent variables.

Dependent variable: in this research, customer’s satisfaction was considered as dependent variable. Hence, the aim of present research study is to evaluate and investigate impact of place, promotion, product and price elements (from among marketing mix elements) on the customer’s satisfaction from Iran Khodro Co. managers and staffs’ perspective. Moreover, the study tries to show how these elements are influential in formation and development of the customer’s satisfaction and how they improve and promote profitability and performance of Iran Khodro Company.

2. Review of the related literature

2.1. Theroretical Framework of the Marketing Mix

Marketing and marketing management: marketing and marketing management are among the most important indexes of knowledge management, which are mainly responsible for identification of human needs and demands and meeting them through resource exchange process [9]. Marketing management is referred to “analyzing, planning, implementing and controlling predetermined plans in order to provide exchanges in appropriate with the underlying markets in order to achieve the organization’s goals” [3].

Definition of marketing exchange: marketing exchange is constituent of tactical tools, which helps establishment of the company’s fixed position in the target markets. The issue, which is developed in the field of elements of marketing mix is that it is claimed that the concept 4p considers marketing from the seller’s perspective not from the buyer’s [10]. Price: price is the amount of money which, the customer has to pay to obtain the product. Sale price involves price list, discounts, special discounts, and payment time and credit conditions. Product involves following variables and components: product diversity, product quality, product design, product specifications, brand, good’s packing, size, dimensions, product quantity, good’s services, product warranty, product returns. Place: involves a set of the company’s activities to make the products available for the target customers. Supply place involves place channels, the product coverage, product’s matching, supply points, stock and transportation. Promotion: is referred to the acts, which introduce the product’s merits to the target customers, encouraging them to buy the product. These activities involve sales development advertisements, media advertisements, sale staffs, public relations and direct marketing (the same reference).

2.2. Theoretical framework of the Customer’s Satisfaction

Definition of customer: customer is referred to the person, who defines his needs by himself. The one, who consumes our services and products and is ready to pay cost for them, He pays the costs until he finds value in the product or delivered service where the payment justifies the cost [17].

Types of customer: from satisfaction level perspective, customers are divided into:

Satisfied customer: satisfied customer is one, who currently is satisfied, however he is, still, not among our value, loyal and permanent customers. This customer is at good state, however he is ambivalent and our competitor can change his mind and make him indifferent toward our organization. Happy customer: this customer is highly loyal to you, because he believes in you, praises you to his friends and brings you knew customers. Dissatisfied customer: instead of being satisfied, he is, unfortunately, among dissatisfied and adverse people. Since you have not met his needs and your competitors have provided better services to him than you have provided. So try prevent customer’s dissatisfaction from the beginning, through providing fundamental services. Fascinated customers: these are ardent and fanatic customers of your organization and they, insist on leading others toward your organization. These are the most valuable customers of you. Angry customer: your organization and your own performance have not only not satisfied him but also they have made him upset and even angry. These groups of customers try to take revenge and their least wish is elimination of you and your organization from the scene [11].

Concept of customer satisfaction: according to the investigations, the concepts related to customer satisfaction and measurements of them were first developed by Oliver in the year 1997. He defined customer satisfaction as good or pleasant sense of past experiences of buying a product or service [12]. According to Oliver “satisfaction is response to the consumer’s achievement or success”. He uses following Figure 1 to define the concept:

Customer satisfaction can be divided in different fields as follows:

- satisfaction from the product or service quality

- satisfaction for continuing relation with the organization (establishment of a continuous and stable relation with the organization)

- satisfaction from the price/the product ratio or service performance

- satisfaction of the customer from the supplied products or services through meeting his needs and expectations [13]

Aspects of customer satisfaction: information satisfaction: satisfaction from the information presented by the supplier to the buyer to choose the product. It is always related to the supplier’s department of advertisement and sale.

Performance or overall satisfaction is a scale or degree, which determines to what deal business performance expectations have been met in the mind of one of business exchange partners within commercial framework of the partners. Attitude satisfaction: is a mental judgment about satisfaction, which is obtained by controlling performance and specifications of the products or services of a supplier. Personal satisfaction reflects traditional and ordinary definitions of satisfaction, which are related to psychological judgments of members of contact point in the customer’s organization, being caused by appropriateness in the communication establishment environment with the supplier [14].

Determining factors of customer satisfaction: when studying customer satisfaction it should be noted that such a satisfaction is achieved by a set of conditions and factors. Presenting an interesting model, Hoisington and Nowman, introduced determining factors of customer satisfaction as follows:

-product quality

-service quality

-relation quality of the supplier and customer

-image

-price

After investigation of customer satisfaction in the car industry and among car buyers, Roskino and Police introduced following items as influential factors of customers’ satisfaction:

- satisfaction from buying

- satisfaction from delivering [15]

Results of customer satisfaction: the reason for paying increasing attention to customer satisfaction and measuring it is its positive results and consequences. Some of these results are:

- loyalty

- advice to others

- decreased sensitivity to price

- decreased loss of customers

- increased share of market [18]

- decreases costs (specially advertisement costs)

- increased profitability

- increased value of the stockholder [16]

2.3. Research Conceptual Model

Figure 2 shows the research conceptual model.

3. Research Methodology

Considering its subject and objectives, present research is among applied studies. Considering the research design and its hypotheses statement way, the research method is descriptive and among descriptive studies it is of correlation type. Field and library studies were employed in order to collect necessary data and information. In this research a 46-item scholar made questioner was used for data collection and determining factors of customers’ satisfaction were evaluated in the field of four elements of marketing mix (i.e. place, promotion, product and price). Since customer satisfaction indexes and marketing mix elements are qualitative in this study, so Likert’s 5-score scale was used for quantification of them. To ensure whether the questioner, really, measures the exact underlying specifications or not, it was distributed among some of the masters and philosophers of the field and they were asked to declare their comment about the types of questions, number of questions and their correlation compared to the research instruments and objectives, after studying them in detail. After implementation of the comments, final questioner was developed and distributed among initial samples of the research. In this research, using Alpha Cronbach test, the questioner reliability was obtained as follows for different elements of marketing mix: place (0.819), promotion (0.802), product (0.829), price (0.765), total (0.932) and customer satisfaction (0.907). Descriptive statistical tests such as calculation of average and percent, table and diagrams along with inferential tests such as Alpha Cronbach, Kolmogrov-Smirnoff test, Pearson correlations test (if data are normal) Freidman ranking test, Durbin Watson test and stepwise regression analysis and finally SPSS were used in this study for data analysis.

Statistical population of the study involves all organizational staffs and managers of Tabriz Iran Khodro Company. According to the official statistics in the company, number of the staffs is 102 and number of managers is 7 and statistical population is 109 in total. Considering limited number of the statistical population, sampling method of the research was selected to be census or all censuses.

Subject framework of the study is in the field of marketing management being limited to investigation of effect of marketing mix elements on customer satisfaction and hence, the issues related to such variables constituted subject domain of the study. Spatial domain of the study was Tabriz town and its time interval included early in the March, 2012 to late in the September 2013.

4. Findings of the Study

Kolmogrov-Smirnoff Test

According to the Kolmogrov-Smirnoff test, in this research all variables enjoyed normal data place and the condition for investigation of correlation test and multiple linear regression is established in hypotheses analysis.

Hypothesis 1 Test and results: marketing mix elements (i.e. place, promotion, product and price) affect customer satisfaction.

Results of Pearson correlation coefficient indicated that each element of marketing mix is in direct relationship with customer satisfaction, being significant at confidence interval of 95% and the relationship level is 82% for place element, 77% for promotion element, 68% for product element and 55% for product element, respectively. Considering table 1 prediction fit condition of customer satisfaction indicates that firstly place element, secondly, promotion element and thirdly product element correlation values of which are 82%, 84% and 85% respectively and determination coefficient value indicate that each of the marketing mix elements explains customer satisfaction variable’s predication. In this prediction, firstly, place element explains 67% of customer satisfaction, which presents a good description in its turn. In the second step, combining place element with promotion element, 71% of the customer satisfaction is explained and at the third step, product element along with place and promotion elements, 72% of customers’ satisfaction is described.

Considering the fitting model, significance level of place, promotion and product elements is less than α=0.05 error level. This shows good level of effect on prediction of customer satisfaction level. Standardized beta coefficient was used for studying direct effect of each element of marketing mix on the customers’ satisfaction in the regression prediction, through which it is possible to judge about relative importance of the variables. In this fitting model effect was, respectively, obtained 51% for place element, 25% for promotion element and 16% for product element. Hence, according to the findings of the study in Tabriz Iran Khodro Co. it can be concluded that place element had the most effect and product element indicated the least effect on the customers’ satisfaction.

According to the findings of Freidman test, level of significance was obtained as 0.000 which is less than error level of (α=0.05). So it is concluded that we can do prioritization among independent variables (marketing mix elements). According to the prioritization carried out by Friedman test, place element, with average prioritization of 4.02 obtained first place, promotion element with average rank of 3.24 obtained second place, price element with average ranking of 2.41 obtained third place and product element with average ranking of 2.15 obtained fourth place in this study from the respondents’ perspective.

Hypothesis 2 conclusion and test: place element affects the customers’ satisfaction

Results of Pearson correlation coefficient indicated that place element has direct and significant relationship with customer satisfaction at the confidence level of 95%, where relationship value is 82%. Considering table 3 of customer satisfaction prediction fitting condition it can be seen that place element explains 67% of the changes of customer satisfaction variable which is relatively good value.

Considering table 4 of linear regression fitting and considering the model fitting it can be seen that the prediction model of customer’s satisfaction by place element is obtained as follows:

Direct effect of place element is 82% in prediction of customer satisfaction.

Results of main hypothesis 2 test indicated that there is a correlation of r=0.82 between the two above mentioned variables at significance level of p=0.000 and since significance level is less than 0.05 it can be concluded that the correlation between the two variables is significant. Hence, place element is in direct relationship with customer satisfaction and the relationship value is 82%. Moreover customer satisfaction prediction fitting indicates that place element explains 67% of the changes related to customer satisfaction, which is relatively good value.

Considering result s of Friedman test, significance level was obtained as 0.000 which is less than error level of α=0.05. So it can be concluded that we can do prioritization among indexes of place element. According to the prioritization carried out by Friedman test it can be concluded that spatial place of Iran Khodro Co. representatives obtained first place in this research from the respondents’ perspective.

Hypothesis 3 Conclusion and Test: promotion element affects customer satisfaction

Results of Pearson correlation coefficient indicated that promotion element has direct and significant relationship with customer satisfaction at the confidence level of 95%, where relationship value is 77%. Considering table 5 of customer satisfaction prediction fitting condition it can be seen that promotion element explains 59% of the changes of customer satisfaction variable, which is relatively good value.

Considering table 6 of linear regression fitting and considering the model fitting it can be seen that the prediction model of customer satisfaction by promotion element is as follows:

Direct effect of promotion element is 77% in prediction of customer satisfaction.

Results of the main hypothesis 3 test indicated that there is a correlation of r=0.82 between the two above mentioned variables at significance level of p=0.000 and since significance level is less than 0.05 it can be concluded that the correlation between the two variables is significant. Hence, promotion element is in direct relationship with customer satisfaction and the relationship value is 77%. Moreover customer satisfaction prediction fitting indicates that promotion element explains 59% of the changes related to customer satisfaction, which is relatively good value.

Considering result s of Friedman test, significance level was obtained as 0.000 which is less than error level of α=0.05. So it can be concluded that we can do prioritization among indexes of promotion element. According to the prioritization carried out by Friedman test it can be concluded that having towing and roadside assistant obtained first place in this research from the respondents’ perspective.

Hypothesis 4 Conclusion and Test: product element affects customer satisfaction

Results of Pearson correlation coefficient indicated that product element has direct and significant relationship with customer satisfaction at the confidence level of 95%, where relationship value is 68%. Considering table 7 of customer satisfaction prediction fitting condition it can be seen that product element explains 36% of the changes of customer satisfaction variable which is relatively good value.

Considering table 8 of linear regression fitting and considering the model fitting it can be seen that the prediction model of the customers’ satisfaction by product element is obtained as follows:

Direct effect of product element is 68% in prediction of customers’ satisfaction.

Results of main hypothesis 4 test indicated that there is a correlation of r=0.68 between the two above mentioned variables at significance level of p=0.000 and since significance level is less than 0.05 it can be concluded that the correlation between the two variables is significant. Hence, results of Pearson correlation coefficient indicated that the product element is in direct relationship with customer satisfaction and the relationship value is 68%. Moreover customer satisfaction prediction fitting indicates that the product element explains 46% of the changes related to customer satisfaction, which is relatively good value.

Considering result s of Friedman test, significance level was obtained as 0.000, which is less than error level of α=0.05. So it can be concluded that we can do prioritization among indexes of promotion element. According to the prioritization carried out by Friedman test it can be concluded that the product’s warranty by the company obtained first place in this research from the respondents’ perspective.

Hypothesis 5 Conclusion and Test: price element affects customer satisfaction

Results of Pearson correlation coefficient indicated that price element has direct and significant relationship with the customers’ satisfaction at the confidence level of 95%, where relationship value is 55%. Considering table 9 of the customers’ satisfaction prediction fitting condition it can be seen that the price element explains 31% of the changes of customer satisfaction variable, which is relatively good value.

Considering table 10 of linear regression fitting and considering the model fitting it can be seen that the prediction model of customer satisfaction by price element is obtained as follows:

Direct effect of price element is 55% in prediction of customer satisfaction.

Results of the main hypothesis 5 test indicated that there is a correlation of r=0.55 between the two above mentioned variables at significance level of p=0.000 and since significance level is less than 0.05 it can be concluded that the correlation between the two variables is significant. Hence, price element is in direct relationship with customer satisfaction and the relationship value is 55%. Moreover, customer satisfaction prediction fitting indicates that price element explains 31% of the changes related to customer satisfaction, which is relatively good value.

Considering result s of Friedman test, significance level was obtained as 0.000, which is less than error level of α=0.05. So it can be concluded that we can do prioritization among indexes of price element. According to the prioritization carried out by Friedman test, it can be concluded that special sales for different occasions obtained first place in this research from the respondents’ perspective.

5. Conclusion and suggestions

According to the results obtained from respondents, it can be concluded that from among components of marketing mix, place element has the most effect and the product element has the least effect on the customer’s satisfaction. So it is proposed that the company to

- fulfill its obligations in the best way in the fields of sales and after sale services to the customers

- distribute the purchased products without any damage

- be completely accountable and act rapidly to solve the failures and faults

- have acceptable control and management on the place channels

- provide conditions, through which the purchased products to reach customers with the least cost

- deliver the purchased products timely and without any delay

- reach its products inventory to a level, to meet the customers’ needs easily

According to the results of respondents, from among components of place element, spatial place of the company’s representatives plays the most influential role in the advent of customer satisfaction. Since, the cars are not spread equally at all places or the cars presence might depend on the seasonal or commutation issues, so the type and combination of repair shops and their services should enjoy required appropriateness.

According to the results of respondents’ answers from among components of promotion element, presence of towing and roadside assistant plays the key role in the customer’s satisfaction. Hence roadside assistants’ bases can promote their reputation and customers’ satisfaction through supplying special facilities for their customers such as sending aid worker in boarding way, setting up mobile assistance group, cooperating with insurance companies.

According to the results obtained from the respondents, from among components of product element, products’ warranty period plays the key role in obtaining customer’s satisfaction. The product warranty involves items such as the car warranty period, number of the parts which are subjected to the warranty, warranty period of the car’s consumable parts, warranty service quality and the car guarantee period. An appropriate guaranty period should be used in the field of car warranty and it should be tried to involve most parts of the car into the warranty until buyers feel more satisfied of having Iran Khodro products. Moreover the company should fulfill its obligations in the fields of service supply and providing spare parts.

According to the results obtained from the respondents, from among the components of price element, special sales considered at different occasion’s plays the key role in the customers’ satisfaction. So the company can sell its products more at different occasions for determined time in the form of special sale.

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