Effect of Smartphone Brand Satisfaction on the Purchase of Other Smart Devices of the Same Brand

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1 , pp Effect of Smartphone Brand Satisfaction on the Purchase of Other Smart Devices of the Same Brand Minyoung Noh 1, Myungsin Chae 2, Byungtae Lee 3 and Moonsoo Yoon 2 1 SK (Corporation) Jong-ro, Jongno-gu, Seoul, 03188, Republic of Korea 2 Seoul Venture University, 405 Bongensa-ro Samsung-dong, Kangnam-gu, Seoul, Korea 3 85 KAIST, Hoegiro, Dongdaemun-gu, Seoul, Korea 1 nohmy@business.kaist.edu, 2 mlee31@naver.com, 3 btlee@business.kaist.ac.kr, 4 msyoon@wmit.or.kr Abstract This research focuses on the effect of brand perceptions formed through the usage of a smartphone on user satisfaction and on subsequent purchasing decisions for other smart devices of the same brand, using the theoretical background of the Expectation- Confirmation Model in IT. This study showed that the brand expectation confirmation before and after using a smartphone affected brand user experiences (perceived usefulness, perceived playfulness, and perceived aesthetics) significantly. This study is meaningful in that it has defined the perceived playfulness and perceived aesthetics in the existing ECM-IT as user brand experience factors, and confirmed the relevant correlations. Also, the confirmation that smartphone usage experience can be fully transferred a user s intention to purchase other smart devices is what differentiates this study with other studies. The research results show that the user s playfulness and aesthetics perception formed through smartphone brand usage experience affects both the brand usage satisfaction and the purchase intention of portable and non-portable devices. Keywords: Brand user experience, smart device, smartphone, ECM, SEM, purchasing intention, aesthetic, mediating effect 1. Introduction Smartphone market growth has already begun to stagnate, so manufacturers have released or are trying to launch new types of smart devices to develop new avenues for growth. IDC [1] predicted that potential wearable device shipments would explode by more than 500% in 2015, i.e., 25.7 million units from 4.2 million in Thus, it is important for smart devices not to be separated from smartphones, but rather smart devices should be an expansion of the existing ecosystem of the platform and the services formed through smartphones. Consumers nowadays not only consider the device itself, but also take many other diverse elements, such as the image of the brand, into consideration when choosing a device [2]. Thus, modern consumers try to obtain more than just the value of the device. They would even pay for the emotions and experiences gained through the usage of the device. That the consumer s brand usage experience and usage satisfaction has a meaningful effect on the reuse and repurchase of the device has been proved through many previous studies [3] [4]. These have only confirmed the usage satisfaction and the intention of reuse of the smartphone itself. Yet, studies confirming the decision changing occurred through the experience of a certain brand during the the usage of other devices of the *Corresponding Author ISSN: IJSEIA Copyright c 2016 SERSC

2 brand are not enough. Thus, the purpose of this study is to find out what kind of effects the brand user experiences, formed by the usage of smartphones, have on the purchase of a device of the same brand. 2. Theoretical Background The purchase of a smart device seems to take the Post-Adaption style which is influenced by the experience of the owner s smartphone usage. The most well-known Post-Adaption Theory related to IT devices or Information Systems is the Expectation- Confirmation Model-IT (ECM-IT). Bhattacherjee [5] suggested through the ECM-IT that a product s function (usefulness) is significant; however, a consumer s satisfaction can be determined not only by function (usefulness) but also by the confirmation of expectations before purchase and user experience after purchase (See Figure1) Figure 1. ECM-IT However, The ECM-IT is limited to only being able to explain the effect on the acceptance decision factor of the information system through perceived usefulness. As the information system becomes more individualized and diverse, the elements affecting the user experience have become diverse; factors affecting perceived decision came to include more than usefulness. [6], pointed out that the current ECM-IT is limited because it only focuses on the usefulness. It added other new elements such as the product consumption value, perceived playfulness, and subjective standards, and tried to figure out the continuance intention based on the usage of smartphones. It stated that smartphone expectation-satisfaction affects all aspects of the value of the products. [7] claimed that it had added service quality and dedication to the factors of the ECM- IT, in order to measure the effect of user experience on the consumer s intention to continue using a particular smartphone. Among other factors, the quality of the device affected the user experience of smartphones greatly as well as the intention of the continuous usage of smartphones. [8] tried to predict the continuance intention of the usage of smartphones by adding two factors, perceived playfulness and behavioral loyalty, to the Expectation-Confirmation Model. This study showed that perceived playfulness had a meaningful effect on the satisfaction and the continuance usage intention. However, smart devices other than smartphones have not yet passed Chasm [9] and because they are only in the spreading phase, there are not many studies on the intention to purchase or the continuance intention itself. [10] stated that in a study on the purchase and intention to continuously use a wearable wrist healthcare device, perceived usefulness 106 Copyright c 2016 SERSC

3 and perceived ease of use have a meaningful effect on the purchase and continuance usage intention. 3. Research Model and Methodology 3.1. Research Model This study sets up the conceptual research model (see Figure 2) based on the IT Continuance Model. The ECM-IT has been used in previous studies to examine the continuous use of smart devices, but it has limitations in explaining the trend of consumer value in modern society because it only focuses on perceived usefulness. As the personal computer (PC) and smartphones have emerged as a means of the personalization of IT devices, previous studies found that emotional characteristics like playfulness [11, 12] and aesthetic elements such as design are important factors for consumers to consider when deciding whether to continuously use IT products [13, 14]. As the individualization of IT devices has rapidly taken place due to the appearance of PCs and smartphones, many studies that have included playfulness characteristics, such as perceived enjoyment, as an IT device acceptance factor [15, 16] insisted that in studies related to the hedonic information system, perceived playfulness was a much more important factor than usefulness. [17] considered aesthetics also as an important factor for technology, and aesthetics that could make the consumer feel beauty through it, could affect the consumer s intention to purchase through satisfaction [18, 19] claimed that design was an important factor for satisfying the user s emotion, and was a factor in the selection process of the product. Recently, [20] stated that according to research studies by the LG Economic Institute, since 2012, the factor that affected a consumer s decision to purchase smartphone the most was design. By referring to previous studies, this study has established the research model as shown Figure 2, which includes not only the user brand experience, but also usefulness, playfulness, and aesthetics. The hypotheses based on the model, are suggested in Table 1. Figure 2. Research Model Copyright c 2016 SERSC 107

4 Table 1. Research Hypothesis H1 The expectation-confirmation of a smartphone brand will have a positive relationship with the user-brand experience. H1-1 Users with a high expectation-confirmation will have a positive relationship with the perception of perceived usefulness regarding brand usage experience. H1-2 Users with a high expectation-confirmation will have a positive relationship with the perception of perceived playfulness regarding brand usage experience. H1-3 Users with a high expectation-confirmation will have a positive relationship with H2 the perception of perceived aesthetics regarding brand usage experience. The smartphone brand usage experience of a user will have a positive relationship with the brand usage satisfaction. H2-1 Perceived usefulness regarding the brand usage experience will have a positive relationship with the usage satisfaction. H2-2 Perceived playfulness regarding the brand usage experience will have a positive relationship with the usage satisfaction. H2-3 Perceived aesthetics regarding the brand usage experience will have a positive relationship with the usage satisfaction. H3 Smartphone brand usage satisfaction will have a positive relationship with the purchase intention of another smart device of that brand. H3-1 Smartphone brand usage satisfaction will have a positive relationship with the purchase intention of a portable device of that brand. H3-2 Smartphone brand usage satisfaction will will have a positive relationship with the purchase intention of a non-portable device of that brand. H4 The Expectation-Confirmation of a smartphone brand will have a positive relationship with the brand usage satisfaction Measurement There are a total of 7 constructs in this study, and 28 questions were developed to measure the constructs. The items for measurement were adopted from previous studies and reworded to suit the context of the current study. Each item was measured with a 5 point Likert scale, ranging from 1 (strongly disagree) to 5 (strongly agree) Data Collection and Analysis Method The survey was conducted with smartphone users, and it was collected from April 22, 2015 to April 30, Of 613 respondents, a total of 583 respondents were eligible for analysis using SPSS 22.0 and AMOS Empirical Analysis 4.1. Demographic Characteristics of the Sample The characteristics of the respondents by demographic variables showed that there are 583 respondents in total; and there are more females (315 respondents, 54.0%) than males (268, 46.0%), and the number of respondents in their 20s, 30s, and 40s accounted for 173 (29.7%), 167 (28.6) and 123 (21.1%) respectively. (see Table 2) The answers to what are the key considerations when purchasing smartphone were functionality(36.7%), manufacturer and brand(19.6%), price(16.5%), design(15.4%) as shown in Table Copyright c 2016 SERSC

5 Table 2. Demographic Variables of the Respondents Number of Respondents (N=583) % Sex male female Age 10~ ~ ~ ~ and over Income Level (Korean Won; during survey period, 1,083 KRW= 1 USD) Below 2,000, ,000,001~4,000, ,000,001~6,000, ,000,001~8,000, Over 8,000, Average time spent per day on smartphone (minutes) less than ~ ~ ~ Over Table 3. The Key Considerations when Purchasing Smartphone Number of Respondents (N=583) % Functionality Manufacturer / Brand Price Design Convenience of After Service Telecommunication Company Durability Fashion / Trend Recommendation by others Measurement Model Estimation and Analysis A confirmatory factor analysis was performed to estimate the measurement model. First, the fit of the measurement model was estimated in Table 4. The results for various indices of goodness-of-fit of the measurement model are summarized at the bottom of Table 4. The results show that the measurement model was adequate. Second, the reliability of all constructs were tested by Cronbach s α. All measurement scales in Table 4 showed relatively higher than 0.70 for all measure, which is the minimum alpha value for good internal reliability on all measures [21] To validate our measurement model, two types of validity were assessed: convergent validity, and discriminant validity. We assessed convergent validity by examining 1) factor loading, 2) composite reliability and 3)AVE (average variance extracted). Factor loading of all indicators should exceed 0.6 and be significant [22]. Table 4 exhibits the weights and loadings of the measures in our research. It shows that all measures are significant on their path loadings at the level of For composite reliability 0.7 is a recommended value [23]. As shown in Table 4, our Copyright c 2016 SERSC 109

6 composite reliability values are over Third, for AVE, a score of 0.5 is a cut-off value [24]. Table 4 shows that AVEs by our measures are over which are above the acceptability value. Thus, the convergent validity of the measurement model was confirmed. EC 1 EC 2 EC 3 Usefulness 1 Usefulness 2 Usefulness 3 Table 4. Measurement Model Estimation Results S.E C.R EC Usefulness Usefulness Playfulness 1 Playfulness 2 Playfulness Playfulness Aesthetics 1 Aesthetics 2 Aesthetics Aesthetics Satisfaction 1 Satisfaction 2 Satisfaction Construct Reliability AVE Cronbach s α Satisfaction Satisfaction Portable 1 Portable 2 Portable 3 Portable 4 Portable Non- Portable 1 Non- Portable 2 Non- Portable 3 Non- Portable 4 Non- Portable 5 Model Fit Χ2= (P=.000) ( p>.05), Χ 2 /df=2.514 (2-3), GFI=.900 (> 0.9), AGFI=..866 (>0.9), IFI=.964 (>0.9), TLI=0958 ( > 0.9), CFI=0964 (> 0.9), RMSEA =.51(< 0.8) Note. EC = Expectation Confirmation The number inside ( ) each index of Model Fit is the recommended cutoff value To verify the discriminant validity of we looked at the square root of the AVE as recommended by [25]. As Table 5 shows, the square root of the average variance extracted for each construct is greater than the levels of correlations involving the construct. This means that each construct shares larger variance with its own measures 110 Copyright c 2016 SERSC

7 than with other measures. The result confirms the discriminant validity of the measurement model. In addition to validity assessment, we also checked for multicollinearity due to the relatively high correlations among some variables (e.g., a correlation of between Playfulness and Aesthetics). The resultant variance inflation factor (VIF) values for all of the constructs are acceptable (i.e., between and 1.432). Table 5. Discriminant Validity Estimation Variables Expectation Confirmation (0.821) 2. Usefulness.666 (.760) 3. Playfulness (.713) 4. Aesthetics (.746) 5. Satisfaction (.737) 6. Portable (.711) 7.Non-Portable (.726) Note. ( ): square root data of AVE of each variable 4.3. Structural Equation Model Estimation and Hypothesis Testing The structure equation model was used for hypothesis testing. From Table 4 the structural model shows an adequate fit as most indices showed passed cut-off values. All the hypothesized paths were significant except for the path between perceived usefulness and brand satisfaction at the 0.05 significance level. (see Table 6.). Table 6. Hypothesis Model Testing Results Hypothesi s Path of Model Coefficient t-value Result H 1-1 brand expectation confirmation perceived usefulness ** accept H 1-2 brand expectation confirmation perceived playfulness ** accept H 1-3 brand expectation confirmation perceived aesthetics ** accept H 2-1 usefulness brand satisfaction reject H 2-2 playfulness brand satisfaction ** accept H 2-3 aesthetics brand satisfaction ** accept H 3-1 brand satisfaction portable purchase intention ** accept H 3-2 brand satisfaction non-portable purchase intention ** accept H 4 brand expectation confirmation brand satisfaction ** accept Χ2= (P=.000) ( p>0.05), Χ 2 /df=2.343 (2-3), GFI=0.908 (> 0.9), Model Fit AGFI= (>0.9), IFI=0.969 (>0.9), TLI=0.961 ( > 0.9), CFI=0.969 (> 0.9), RMSEA =0.48 (< 0.8) Note. **: p<0.01, *: p<0.05 The number inside ( ) each index of Model Fit is the recommended cutoff value Copyright c 2016 SERSC 111

8 5. Conclusion 5.1. Research Summary and Discussions According to the results of this research, the Expectation-Confirmation, which shows the difference in the consumer s thoughts before and after the usage of a brand, had a meaningful effect on the brand usage experience (perceived usefulness, perceived playfulness, and perceived aesthetics). Yet, among the types of brand usage experience, perceived usefulness did not have a meaningful effect on the user s satisfaction; perceived playfulness and perceived aesthetics had a meaningful effect on user brand usage satisfaction. This study found that perceived usefulness does not have an impact on brand satisfaction; this implies that functionality and performance are not key differentiation factors in the mature smartphone market. Meeting user satisfaction through functionality is difficult in the market in the maturity phase because the speed of technology development and user IT skills do not match [26]. It is shown that the advancement in device technology and the speed of its adaptation do not match the user s actual experience. In a fully-grown market such as the market for smartphones, factors other than the supplement of new features and advancement in functions are necessary for improving consumer satisfaction. Currently smartphones have been standardized in an upward direction in terms of functionality. Thus, usefulness no longer plays a role as a differentiation factor [27]. The study also suggests that user satisfaction in a matured market like the smartphone market may be enhanced by focusing on the senses and emotions or stimulating perceived playfulness and aesthetics. This study is meaningful in that it has defined the perceived playfulness and perceived aesthetics in the existing ECM-IT as user brand experience factors, and confirmed the relevant correlations. Also, the confirmation that smartphone usage experience can be fully transferred a user s intention to purchase other smart devices is what differentiates this study with other studies. The research results show that the user s playfulness and aesthetics perception formed through smartphone brand usage experience affects both the brand usage satisfaction and the purchase intention of portable and non-portable devices. This is expected to help smartphone manufacturers to establish a product strategy, and it should also help establish effective communication between the product development department and the marketing department Limitations of the Study and Directions of Future Research This study has a few limitations and some things to consider for future research: First, it would have been better if this study measured the factors the users most frequently considers when choosing a smartphone brand. If the first reason for choosing a smartphone brand had been measured, and the correlation with it and the brand usage experience factors had been studied, a meaningful effect could have been confirmed regarding the establishment of switching barriers for the development of smart devices. In future research, it is expected that if a study is carried out regarding the correlation of user s first perceived intention of purchasing a smartphone brand, the smartphone brand usage experience, and the smart devices first perceiving intention, it would have an interesting result. Second, there is a limitation that this study does not include the service-related factors in the smartphone brand usage experience. In modern industries, the management of after service provided for consumers and VoC (Voice of Consumers) shows the industry s capability and is one of the brand factors that enhances loyal consumer. This study had not included this due to the worry that the research scale would become too big, but in future studies, it is likely that service-related factors will be included. 112 Copyright c 2016 SERSC

9 Third, it would have been better if modern consumption patterns had been reflected in the study. Modern consumers tend to purchase products after having rationally compared and analyzed the products through searching for information on various products involving factors such as reputation and product reviews. The correlation with the recommendation and review of a product by a stranger, rather than an acquaintance, and one s brand experience, and the effect this has on the future purchase of a product could have been considered. References [1] IDC, Worldwide quarterly wearable device tracker, March, (2015) [2] C. Z. Jin and E.B. Park, The Effect of Product Attributes, Brand and Corporate s Images on Consumer s Purchasing Intension Focusing on Chinese Cellular Phone Markets in 9 Areas, The International Association of Area Studies, vol. 12, no. 3, (2008), pp [3] I. H. Jung, Factors influencing smart device adoption and use: from multi-device use environment, Seoul National University (Master Degree), Seoul, (2013). [4] F. Reichheld, The Loyalty Effect, Harvard Business School Press, Boston, (1996). [5] A. Bhattacherjee, Understanding Information system continuance: An expectation-confirmation model, MIS Quarterly, vol. 25, no. 3, (2001), pp [6] D. H. Shin and S. Kim, An expectation-confirmed approach to the users continued use of smart phone, Korean Journal of Journalism and communication studies, vol. 56, no.2, (2012), pp [7] J. C. Jang, A study on the determinants of smart phone continuance intention with the consideration of user experience, Entrue Journal of Information Technology, vol. 12, no. 1, (2013), pp [8] J. H. Jung, A study on satisfaction, attitudinal loyalty and continuance intention for smartphone use in ECM, Gyeongsang National University (Ph. D. Degree), (2015). [9] S. K. Kim, 2015 Wearable Device Market Forecast, KT Economy and Business Management Research Institute, (2014). [10] M. S. Shin, A Study on the Influential Factors of Purchase Intention and Continuance Intention of Wearable Device: Focused on Wrist Wearable Healthcare Device, Dept. of Broadcasting and Communication Policy Graduate School of Public Policy and Information Technology, Seoul National University of Science and Technology, (2015). [11] H. Van der Heijden, User Acceptance of Hedonic Information Systems, MIS Quarterly, vol. 28, no.4. (2004), pp [12] J. I. Kwon, A Study on the Relationships between the Information Technology Acceptance Model and Switching Costs, Department of Business Administration Graduate School, Daegu University Gyeongbuk, Korea, (2013). [13] L. Alben, Quality of experience: defining the criteria for effective interaction design, Interactions 3(3), (1996), pp A. H. Eagly, R. D. Ashmore, M. G. Makhijani and L. C. Longo, What is beautiful is good but.: A metaanalytic review of research on the physical attractiveness stereotype, Psychological Bulletin, 110, (1991), pp [14] J. I. Kwon, A Study on the Relationships between the Information Technology Acceptance Model and Switching Costs, Department of Business Administration Graduate School, Daegu University Gyeongbuk, Korea, (2013). [15] H. Van der Heijden, User Acceptance of Hedonic Information Systems, MIS Quarterly, vol. 28, no.4. (2004), pp [16] L. Alben, Quality of experience: defining the criteria for effective interaction design, Interactions 3(3), (1996), pp A. H. Eagly, R. D. Ashmore, M. G. Makhijani and L. C. Longo, What is beautiful is good but...: A metaanalytic review of research on the physical attractiveness stereotype, Psychological Bulletin, 110, (1991), pp [17] K. Chen and C. L. Owen, "Form Language and Style Description," Design Studies, Vol.18, No.3, (1997), pp [18] M. H. Kim and N K. Kim, Seeing Consuming trend when looking searching data. LG Business Insight, LG Economic Research Institute, (2013), pp [19] J.F. Pallant and A. Tennant, "An introduction to the Rasch measurement model: an [20] Example using the Hospital Anxiety and Depression Scale (HADS)", British Journal of Clinical [21] Psychology, vol. 46, no. 1, (2007), pp [22] C. Fornell, and V. F. Larcker, Evaluating Structural Equation Models with Unobservable Variables and Measurement Error, Journal of Marketing Research, 18(1), (1981), pp [23] J. F. Hair, R. E. Anderson, R. L. Tatham and W. C. Black, Multivariate Data Analysis, Prentice-Hall International, Inc., 5th Edition, (1998), Chapter 11. [24] C. Fornell, and V. F. Larcker, Evaluating Structural Equation Models with Unobservable Variables and Measurement Error, Journal of Marketing Research, 18(1), (1981), pp Copyright c 2016 SERSC 113

10 [25] C. Fornell, and V. F. Larcker, Evaluating Structural Equation Models with Unobservable Variables and Measurement Error, Journal of Marketing Research, 18(1), (1981), pp [26] E.L.C. Law, V. Roto, M. Hassenzahl, A.P.O.S. Vermeeren and J. Kort, Understanding, scoping and defining user experience: a survey approach, Proceedings of the 27th International Conference on Human Factors in Computing Systems (CHI 2009), (2009), pp [27] C.Z. Jin, and E.B: Park, The Effect of Product Attributes, Brand and Corporate s Images on Consumer s Purchasing Intension Focusing on Chinese Cellular Phone Markets in 9 Areas, The International Association of Area Studies, vol. 12, no. 3, (2008), pp Authors Minyoung Noh, He received the degree of Master of Science in Information Management from KAIST at Seoul Korea. He works as a business manager in SK Holdings. Myungsin Chae, She received Ph. D in MIS from the University of Illinois at Chicago in She is a professor in the department of MIS at Seoul University of Venture and Information at Seoul Korea. She teaches courses and conducts research in e-business and mobile business, and strategic IS management. Byungtae Lee, He is a professor of College of Business, KAIST and CEO of KAIST Venture Investment Holdings. He is also managing three research centers at KAIST; SK Center for Social Entrepreneurship, Research Center for Corporate Social Responsibility and Research Center for Digital Economy and Innovation. He also taught at The University of Illinois at Chicago and The University of Arizona as a faculty member of their business schools. He received his Ph.D. in Business Administration (major in MIS, Minor in Economics) from The University of Texas at Austin. His research topics include Economics of IS, IT productivity measurement, strategic IT investments, Electronic Commerce, Electronic Auction markets, IT applications for health industry, Economic Analysis of Digital Content Business, and Analysis on Virtual Economy. 114 Copyright c 2016 SERSC

11 Moonsoo Yoon, He is the Chief Researcher at the Wonju Medical Industry Technovally(WMIT), Korea. He is the adjunct professor at the Biodefense Research Institute (BDRI), Korea University. He is studying for Ph. D. in Business Management at the Seoul Venture University. He served for the DPKO, United Nations in New York as the Medical Support Officer from 2001 to He was graduated from the Public Health Graduate School, Yonsei University in Copyright c 2016 SERSC 115

12 116 Copyright c 2016 SERSC