Int. J. Services and Standards, Vol. 7, No.

2, 2011 95

Improving B2C business for online store – the case

study of agriculture products e-market shop in
Taiwan

Chang-Han Wang and

Tzong-Ru Lee*
Department of Marketing,
National Chung Hsing University,
250 Kuo Kuang Rd., 402 Taichung City, Taiwan
Fax: +886 4 22861437
E-mail: s7655960@gmail.com
E-mail: trlee@dragon.nchu.edu.tw
*Corresponding author

Wen-Shan Lin
Department of Management of Information Systems,
National Chiayi University,
No. 580 Sin-Min Rd., 600 Chiayi City, Taiwan
E-mail: wslin@mail.ncyu.edu.tw

Nirote Sinnarong
Department of Applied Economics,
National Chung Hsing University,
Taichung, Taiwan
E-mail: nirote1980@gmail.com

Agnieszka M. Dadura
Institute of Electronic Commerce,
National Chung Hsing University,
Taichung, Taiwan
E-mail: agnieszkadadura@gmail.com

Jan-Mou Li
Civil and Environmental Engineering,
University of Tennessee,
Knoxville, TN, USA
E-mail: janmouli@gmail.com

Copyright © 2011 Inderscience Enterprises Ltd.

96 C-H. Wang et al.

Abstract: In this paper, we propose a framework for continuous improvement

of business to consumer applications, especially the customer-oriented
marketing mix emphasising the viewpoint of customer. Incorporating strategic
guidance together with the customer-oriented marketing mix, the proposed
framework suggests identifying latent issues within the purchasing processes
first, asking customers’ opinion about the issues and then locating critical
concerns of these issues using grey relational analysis. As a consequence of
coping with these concerns, the connected processes can be reengineered to
increase customers’ satisfaction. This study can be used as a reference by other
researchers studying different kind of e-commerce business models as well as
by the practitioners who are looking for ways to improve their online
marketplaces.

Keywords: online store; e-market; Taiwan; study case; services; standards.

Reference to this paper should be made as follows: Wang, C-H., Lee, T-R.,
Lin, W-S., Sinnarong, N., Dadura, A.M. and Li, J-M. (2011) ‘Improving B2C
business for online store – the case study of agriculture products e-market shop
in Taiwan’, Int. J. Services and Standards, Vol. 7, No. 2, pp.95–118.

Biographical notes: Chang-Han Wang graduated with Master’s degree in

Marketing from the Department of Marketing in National Chung Hsing
University, Taiwan. During his studies, he has been also interested in fields
such as supply chain management and logistics.

Tzong-Ru (Jiun-Shen) Lee is a Professor of the Department of Marketing,

Chief of Media Relations Division, former Chairman of the Department of
Marketing, former Chairman of Institute of Electronic Commerce and former
Chairman of Center for Electronic Commerce and Knowledge Economics
Research in National Chung Hsing University, Taiwan. He is a 2006 Fulbright
Visiting Professor in USA and a joint author of four books. His researches
mainly focus on SCM, CRM, marketing, EC, risk management and business
ethics. Also, he is the Editor-in-Chief of IJECRM and the Associate Editor
of IJLEG.

Wen-Shan Lin is an Assistant Professor of MIS at National Chiayi University,

Chiayi, Taiwan. She received her PhD in MIS from the University of
Manchester, UK. Her research focuses on e-commerce and internet marketing.

Nirote Sinnarong is a PhD Student at the Department of Applied Economics,

National Chung Hsing University; Economics Instructor of Maejo University in
Thailand. He is a 2008 Taiwan scholarship recipient. His researches mainly
focused on business economics, applied statistics for business and applied
economics.

Agnieszka M. Dadura (MSc) graduated with Master of Business

Administration degree from the Institute of Technology Management in
National Chung Hsing University, Taiwan, with her thesis focusing on the tool
to measure innovativeness of food industry companies. During her studies, she
has been also interested in fields such as e-marketing, branding, supply chain
management and cultural differences in consumer behaviour.

Jan-Mou Li earned his Doctoral degrees in Engineering and Management. He

works in the areas of transportation and e-commerce, both of which involve
studying the interplay between engineering and managerial processes. Much of
his work focuses on the nature of transportation, in terms of its supply and
 Case study of agriculture products e-market shop in Taiwan 97

demand, especially the needs induced by e-commerce connected activities.

His research is currently focusing primarily on multiple-dimensional data
processing which consists of data mining, visualisation and simulation for
decision support.

1 Introduction

Nowadays e-commerce (EC) is blooming in many business fields. More alternatives

available over the internet make it harder for a firm to keep their customers updated with
purchasing processes. Continuous improvement, which focuses on improving customer
satisfaction through continuous and incremental improvements of processes, may be a
good practice for the leadership. To meet businesses and customers’ needs, this paper
proposed a top-to-bottom framework for the improvement by reengineering purchasing
processes from a strategic point of view.
For the continuous improvement, reengineering purchasing processes are a rational
approach. King (1994) argued that a strategic view is essential if reengineering is aimed
at achieving fundamental high-impact change. ‘Identifying new product and market
opportunities’ is one of the six strategic dimensions of process reengineering that he
proposed in his paper. Since a successful improvement process is rather detailed and
because many alternatives are typically considered, this dimension does not provide an
intense analysis of a business; however, there is no better process than reengineering for
considering new products and new markets for existing products or innovations.
A general idea of success for implementing a business to consumer (B2C) EC is to
reach more customers, service them better and thus generate more sales while spending
less to do so. Due to its consumer-oriented nature, all connected processes should be
designed and guided by niche marketing instead of mass marketing. However, it is a
relatively new approach and such that not every player realises its potential benefits and
challenges, not to mention applying adequate marketing mix.
Lauterborn (1990) claims the conventional marketing mix should be looked at from a
consumer’s perspective, instead of manufacturer’s perspective. It leads to the
transformation that is accomplished by converting products into customer solutions, price
into cost to the customer, place into convenience and promotion into communication
(4Cs). According to McClean (2009), the product part of the conventional 4P’s model is
replaced by consumer or consumer models, shifting the focus to satisfying the consumer.
Another C replacement for ‘product’ is ‘capability’. ‘Pricing’ is replaced by ‘cost’,
reflecting the reality of the total cost of ownership. ‘Placement’ is replaced by the
‘convenience’, since with the rise of the internet and hybrid models of purchasing, place
of the purchase is no longer relevant, and it is convenience that takes into account the
ease of finding and buying a product, finding information about it and several other
considerations. The ‘promotion’ feature is replaced by ‘communication’, which
represents a broader focus and can include advertising, public relations, personal selling,
viral advertising and any other form of communication between the firm and the
consumer. In short, the customer-oriented marketing mix emphasises the viewpoint
of customer.
To illustrate the proposed framework, an empirical case is reported in this paper. It is
a B2C EC platform operated by Taipei County Farmers’ Association in Taiwan – Zhen
98 C-H. Wang et al.

Qin Food Market. Its primary function is selling agriculture products to general public in
Taiwan. To improve their services continuously and stay on the leading edge, the
proposed framework was implemented to facilitate the reengineering.
The framework of this paper organised as follows. After the introduction part, in
Section 2, we reviewed connected literature, the proposed framework is introduced
in Section 3, its implementation and grey relational analysis (GRA) is discussed in
Section 4. The empirical case is described and discussed in Section 5. Finally, the
characteristics of the proposed framework, its implementation, as well as contribution
would be summarised and concluded in Section 6.

2 Literature review

To show the rationale behind the proposed framework for the continuous improvement,
some connected works in reengineering, B2C EC, marketing mix, experiment design and
GRA are briefly reviewed in this section. The context is organised from the perspective
of the top strategic level, i.e. how to guide the reengineering to the down operational
level, i.e. how to determine customers’ critical concerns.

2.1 Reengineering
The idea of reengineering was first introduced in a paper in Harvard Business Review by
Hammer (1990). The idea is also known as business process reengineering
(BPR). Hammer and Champy (1993) defined the idea as ‘fundamental rethinking and
radical redesign of business process to achieve dramatic improvements in critical
measures of performance such as cost, service and speed’. It promised a novel approach
to corporate change along with ‘walking in the customer’s shoes’, finding out what it is
that customers really want and then designing processes to meet that demand.
Although the labels and steps differ slightly, the early methodologies (e.g. Guha et al.,
1993) that were rooted in information technology (IT)-oriented reengineering solutions
share many of the same basic principles and elements. Benefiting from lessons learned
from the early adopters, some reengineering practitioners (e.g. Roberts, 1994) advocated
the change in emphasis to a customer-oriented, as opposed to an IT-oriented,
methodology. Since BPR can be seen to represent a range of activities concerned with the
improvement of processes, various tools and techniques (O’Neill and Sohal, 1999) were
available in the search for the best reengineering application. For example, in the airline
industry, DeVries (2009) reviewed existing boarding process and the gate hold room
environment and proposed improvements to maintain existing customer base and
attracting new clientele through a threefold approach are:
1 add dynamic informational displays that update information regarding boarding
status
2 reengineer the boarding sequence to reduce boarding time
3 reengineer the process of loading carry-on luggage.
However, it is rare to incorporate with the marketing mix approach, not to mention the
customer-oriented 4Cs.
 Case study of agriculture products e-market shop in Taiwan 99

2.2 B2C e-commerce

According to Lu (2003), customer satisfaction is one of the main aspects for evaluating
B2C EC applications. The linkage between customer satisfaction and the EC
application’s success has become an important issue discussed in a number of papers.
Zhang and Prybutok (2004) revealed the importance of offered service in online shopping
environment and proofed the link with customer loyalty and perceived usefulness. Becker
(2004) examined the privacy conditions supplied by commercial websites against fair
information practices principles developed by federal trade commissions. It revealed that
there are lots of improvements should be done to improve consumer privacy in practices.
Cho (1999) investigated customer-focused internet commerce at Cisco systems to
identify whether matching customer demands is a key factor to the success of an EC
application. Balocco et al. (2004) compare the differences of e-mall business model
between Italy and USA to highlight the critical factors in success. Helander and Khalid
(2000) used a system model to illustrate the relationships between three subsystems in
EC: store environment, customer and web technology. Tang et al. (2001) proposed a
conceptual model to demonstrate the rationale of the buyer–supplier interaction with the
information service provider’s mediation in an EC environment. Palmer (2002) found
that user satisfaction with EC applications was significantly associated with usability and
design features unique to the web, such as download delay, navigation, content,
interactivity and responsiveness. Thus, Flavian et al. (2009) stated that the web design is
the key factors for achieving a successful e-store especially in the growth of the
competence in the e-marketplace feature.
In addition, online shopping invokes methods of information gathering that are
different from those of the traditional shopping experience, raising questions about user
satisfaction with the information quality and software quality of EC applications,
resulting in discrepancies between prior expectations and perceived performance (Zviran
et al., 2006). According to their empirical investigation, Zviran et al. (2006) showed that
website success was related to usability measures, as well as incorporating the user-based
design construct, which had not been investigated previously in information systems user
satisfaction research. The results indicated the direction of improving purchasing
applications in a B2C operation. However, it is still needed to further establish a
framework for the improvement process for B2C EC model.
Moreover, the standard of online system plays a crucial role in e-marketing
environment. The service quality and standard have become an important issue discussed
in a number of studies. Eduardo et al. (2010) showed that there are six relevant, valid and
reliable dimension of service quality for internet banking: accessibility/availability,
accuracy, products/services quality, responsiveness, security/privacy and usability. Boden
and Wei (2010) studied e-business standards in the international hospitality and tourism
industry that move towards higher application on e-business. The results from this
research can help the international hospitality and tourism firm to set up e-business
standards and speed e-business adoption to improve global competitiveness.
100 C-H. Wang et al.

2.3 Marketing mix – from 4Ps to 4Cs

2.3.1 4P marketing mix
Since 1960, when McCarthy announced the 4Ps marketing mix theory, it has become the
framework for later marketing theories and models. The 4Ps approach is based on
the manufacturer’s point of view and puts the emphasis on the manufacturer’s profit. It
suggests that using the products and services, the business has already processed to gain
the most profit. However, it does not concern much about the customers’ point of views,
which has effect on the continuity of marketing.

2.3.2 Marketing mix from the customer’s viewpoint

Kotler (1984) emphasises that the most important thing in marketing is demand
management, which means to regard satisfying customer’s demand as the top goal. It is a
customer-oriented strategy and it requires all the employees in the company to think for
customers thoroughly. It claims to establish a fine reputation and gain the customers’
trust by focusing on providing good service. In 1990, Lauterborn (1990) advocated the
4Cs concept which is a customer’s point of view approach. The 4Cs are:
1 consumer needs and wants
2 cost to the customer
3 convenience
4 communication.
Unlike 4Ps which focus on products and services, 4Cs is considered to be a marketing
tool designed according to customers’ preferences.
In ‘consumer needs and wants’, Lauterborn (1990) indicates that if manufacturer does
not try to understand the customers’ needs and provides unnecessary product or service
for them, the provision is invalid. Product or service should be provided for the customer
who needs it to satisfy the particular ‘consumer needs and wants’. In ‘cost to the
customer’, Lauterborn (1990) points out that, compared to putting an irrelevant price,
understanding the ‘cost to the customer’ to satisfy the customers’ needs and wants is
more significant. For example, the price of hamburger that customers are willing to pay
will be influenced by the time customers spend on buying it, the vegetarian perception
and the obesity problem of children. Therefore, when the manufacturers are pricing
products, they should give consideration to ‘cost’ from customer’s point of view. Lilien
et al. (1992) also indicate that ‘cost to the customer’ stands for the cost that customers
have to pay relatively when they receive the product or service, including monetary price,
time cost, energy cost and psychic cost; while Lu and Feng (2006) also indicate that ‘cost
to the customer’ includes transaction and time costs. As for the ‘convenience’,
Lauterborn (1990) indicates that in the times when catalogues, credit cards and mobile
phones can be easily accessed from anywhere, customers can purchase products or
services they want more conveniently. Hence, rather than focusing on the placement
only, the manufacturer should focus on the convenience of getting the product and
service, and the accessibility of the purchase. Beach (1980) defines that ‘communication’
is the transmitting of information between individuals. If the information or conception
cannot be transmitted, the communication is invalid. To successfully communicate, the
 Case study of agriculture products e-market shop in Taiwan 101

information that is transmitted has to be understood. Therefore, communication is a

process in which the information is transmitted and understood between individuals.
Lauterborn (1990) says that all the good promotion activities are dialogues based on the
good interaction between manufacturers and customers. The purpose of ‘promotion’ is to
reach a consensus with customers and provide the products to customers need through the
mutual interaction. Then, reaching the mutually beneficial goal can be achieved through
‘communication’.
In short, the customer-oriented marketing mix emphasises the viewpoint of
customers. That is, right products should be provided adequately based on customers’
needs and wants. Price should be made according to the cost which customer is willing to
pay. Relaying on customers’ preferences, convenient points of sale should be supplied.
Customer-oriented promotions should be offered in line with bidirectional
communications with customers.

2.4 Grey relational analysis

Grey system theory was announced by Deng in 1982, where grey stands for mostly
incomplete and unclear messages. Deng (1982) indicated that grey system uses the
brightness of colour to show how much information is known. The black box means we
know nothing about the structures, features and parameters inside the system, while when
the information of the system is well known and the relation between input and output is
clear, it is called a white system. Therefore, grey colour represents the uncertainty of the
information of the system. Thus, the system in which part of the information is known
and part of it is unknown, is called grey system. Also, Deng (1982) introduced the GRA
as a dynamical measurement by analysing similarity and variability among all factors to
establish their relation.
Grey systems theory is a new method for studying problems of uncertainty with few
data points and poor information. As soon as this new theory was born, many scholars
joined in the research of grey systems and made theoretic exploration and practical
applications in different fields. At present, many well-known scholars have employed in
research and applications of grey systems in many countries, such as England, USA,
Germany, Japan, Australia, Canada, Austria, Russia, Taiwan, Hong Kong, United Nation,
Turkey, South Africa, etc. (Liu et al., 2009).
Since many statistical correlation analyses can provide not only correlation
coefficients among factors, but also the relevant significance level. Unlike traditional
method, GRA provides an alternative method to identify the correlations among factors
in the context of data starvation without traditional statistical assumptions (e.g. data
distribution, errors term distribution and sufficient data are required to determine its
distribution type and to ensure statistical significance). It can be used to identify major
correlations among factors of a system. Thus, one of the major advantages of this method
is that it can generate acceptable outcomes using a relatively small amount of data (Song
and Shepperd, 2011).
Tzeng and Tsaur (1994) also indicated that GRA has gradually become one of the
most effective valuing methods among academics. Its advantage is that it clearly defines
attributions which affect the developing tendency of a system. In the study of Wu et al.
(1996), GRA is used to judge if the factors between two systems will change with time,
using different subjects the relational grade, which is the rate of relevance, is calculated.
In the developing process, if two factors change towards the same tendency, then we can
102 C-H. Wang et al.

say the relation grade is high, and vice versa. In short, we use GRA as a method to
calculate the ‘grey relational grade’, a similarity between the developing tendencies of
factors. However, Jiang et al. (1998) announced that the application of GRA ranges from
‘not certainly’, ‘multi-input’, ‘discrete data’ and ‘not enough to deal with them
efficiently’. In addition, Salmeron (2010) stated that GRA has become a very effective
method of solving problems environments under discrete small and incomplete data sets
with widely and successful applications in industry, energy, transportation, meteorology,
geology, hydrology science, medicine, military science, business, agriculture, etc. For the
empirical study on business point of view, Zhang et al. (2011) used the grey relative
correlation analysis method to evaluate the influencing factors of the enterprise
informatisation in southwest China. Their research results show that the proposed
evaluation system and evaluation method are reliable, practical and able to better reflect
the level of enterprise information and demand characteristics. Shuai and Wu (2011) also
applied GRA to analyse the impact of internet marketing on hotel performance. The
result showed that internet marketing can affect the operating performance of
tourist hotels.
Liu et al. (2004) have introduced the four features of GRA, which are:
1 the model is a non-functional sequence model
2 it is very easy to learn the calculations
3 it can run with only few data
4 the data do not have to fit in the typical distribution rules.
Also, Wu et al. (1996) point out that there are three steps in GRA, that we are using in
our study as well:
1 Grey relational coefficient: the grey relation coefficient of localised grey relation
measure:
ǻ min  ] ǻ max
J  x0 (k ), xi (k )  J 0i (k ) (Formula 1)
ǻ0i (k )  ] ǻ max

where
a i is the number of factor sequence (i = 1,…,m); k is the number of respondents
(k = 1,…,n)
b x0(k): reference sequence; based on maximum value of measurement scale of
factor sequence. If the measurement scale range from 1 to 5 (strongly
dissatisfied, dissatisfied, neither dissatisfied nor satisfied, satisfied, strongly
satisfied), the maximum value of reference sequence is 5.
xi(k): comparability sequence; the raw data of factor affecting respondents’ satisfaction.
The maximum value of comparability sequence is 5 that indicated the respondents have
strongly satisfied while the minimum value is 1 that indicated the respondents have
strongly dissatisfied.
c ǻ 0i x0 ( k )  xi (k ) : the deviation sequence of the reference sequence x0(k) and
the comparability sequence xi(k)
 Case study of agriculture products e-market shop in Taiwan 103

d ǻ min min .min x0 (k )  x j (k ) (Formula 2)

 j i  k

e ǻ max max .max x0 ( k )  x j (k ) (Formula 3)

 j i k

f : distinguishing coefficient, ]  [0,1] , Deng (1982) points out that generally ]

has to be about 0.5, but it can still be adjusted with the demand. Though ] is
related to the grey relational coefficient, it will not affect the grey relation grade.
Therefore, we set the ] as 0.5 directly.

2 Calculating the grey relational grades: when we get the grey relational coefficient,
we can calculate the grey relational grade of x0 and xi by following formulas:
n
ī  x0 , xi  ī0i ¦ E J  x (k ), x (k ) 
k 1
k 0 i i 1,! , m

n
Here âk is elements’ weight, ¦ E
k 1 k
1 . Generally, we adapt the same weight to
calculate the grey relational grade, thus Ek 1/ n . In this case, the average of the grey
relational coefficient is the grey relational grade. So in the same weight, the definition of
grey relational grade is:
n
1
ī  x0 , xi  ī0i
n ¦ J  x (k ), x (k ) 
k 1
0 i i 1,! , m (Formula 4)

In general, a scale item with a high value of ī0i indicates that the respondents, as a whole,
have a high degree of favoured consensus on the particular item.
3 Grey relational order: in GRA, grey relational grade is not the key point, instead, the
order of grey relational grade is the important information. Therefore, we put grey
relational grades of ‘m’ compared series to a referenced series x0 in the order of the
grey relational order.

When ī  x0 , xi  t ī  x0 , x j  , the grey relational grade of xi to x0 is bigger than the grey

relational grade of xj to x0, and the grey relational grade of xi to xj can be represented as
xi ; x j .
The formula of quantification in the grey relational space is called the grey relational
grade. When we only take x0 (k ) as a referenced series, it is called localised grey
relational grade, and we use the localised grey relational grade as the measurement in this
paper. In the grey relational space, there is a series:
' min  9' max
O  xi ( k ), xJ (k )  (Formula 5)
' 0i (k )  9' max

here
a i = 1,…,m; k = 1,…,n; j  i
b x0 is a referenced series, xi is a special comparative series
104 C-H. Wang et al.

c ' 0i x0 ( k )  xu ( k ) : the absolute value of kth difference of x0 and xi

d ' min min min

j  ik x0 (k )  x j (k )

e ' max max

j  ikmax x0 (k )  x j (k )

f 9 : recognised coefficient: 9  > 0,1@ .

The analysed steps of our research are to transform the data into sequence, so we adapt
the grey relational generation to find the grey relational coefficient. After that, we
find the grey relational order and then find the most important factor. For this study,
we have interviewed members of Zhen Qin Food Market by using questionnaires, and
with it we found ways for the store to improve their services.

3 The proposed framework

Marketing mix in this research is based on the stance of customers expecting proper
products according to their needs and wants. It also requires pricing the products and
services according to the cost as perceived by the customer. In addition, it provides
convenient purchasing place for customers according to the location and the ways
customers prefer or are used to and reinforce the communication between customers and
businesses to promote products and services.
Yang (2000) pointed out that when a marketing activity transforms from non-
technological management to a technological management, the process of marketing, the
sale of products, the prices and the advertising methods have to be reconsidered. The case
in this paper, Zhen Qin Food Market, is a store that runs its business on the internet
selling agricultural products. Due to the internet’s special features, such as real time,
interactivity and openness, it has an impact on the features and contents of the 4P
marketing mix. For example, the interactive feature of the internet allows the customers
to communicate with the companies, so that it changes the one-way marketing form into
two-way interactive one, also, because such interaction is enabled, it forces companies to
adapt customer-oriented policies while publishing their new products on the web. The
real-time feature of the internet changes the management way for businesses, and
therefore it also changes their marketing mix. The openness of the internet allows
customers to compare prices of products and services by searching the information about
competitors and alternatives online, which forces companies to design their pricing
strategies more carefully.
Therefore, in our paper we use the concept of the 4C proposed by Schultz et al.
(1993) that was already described in Section 2, as the foundation of the questionnaire.
The contents and aspects are illustrated in Table 1.
 Case study of agriculture products e-market shop in Taiwan 105

Table 1 The contents and aspects of 4C

4C contents Aspects
Consumer needs and wants Qualities of products, sorts of products, services of sales clerks,
services after customers buying products, facilities and common
promotion activities
Cost Prices of products and time
Convenience Parking problems, spaces, traffic and the process of purchasing
Communication Images of retail stores, surrounding, advertisements and news
Source: Schultz et al. (1993).

4 The implementation of the framework

In our paper, we design questionnaires according to the aspects of the 4C marketing mix,
and we use telephone interview with the customers to find the room for improvement for
the trading process, system functions and activities of the Zhen Qin Food Market. In
addition, we use GRA to extract the improvement-worthy elements, and then analyse the
complaints, complements and suggestions received from customers. Then, we will give
the advice to Zhen Qin Food Market on how to promote its values to their customers.
As we already mentioned, we use the 4Cs concept proposed by Schultz et al. (1993).
We adjust the 35 questions to suit for the members of Zhen Qin Food Market, and then
GRA to find the grey relational grade and grey relational order of the questions. Based on
the results of the questionnaire and telephone interview, we then give suggestions to the
Zhen Qin Food Market.

4.1 The e-commercial function and trading process of the Zhen Qin Food
Market
There are two parts in their EC process:
1 The trading process: we research in practice problems that may occur in the trading
process.
2 The function process: we discuss about the inner EC function process and involved
problems.

4.1.1 The trading process of the Zhen Qin Food Market

From Figure 1, we can see that to buy the products from Zhen Qin Food Market,
customers can use the internet to register an account and then log in to see the catalogue
and subscribe the products. Also, customers can place an order by telephone or fax.
When customers finish subscribing the products and pay the bill, the customer service
centre will confirm the order information again. Afterwards, products will be delivered to
the appointed address at the expected time through outsourced logistics company. If
customers have any inquiries, they can contact the company by telephone or internet. In
case there is a problem with received products, they can be returned by reverse logistics
process, and then the Zhen Qin Food Market will deliver the right products to customers.
If the mistake is serious, the customer will receive the phone call from the company and
also an apology gift.
106 C-H. Wang et al.

Figure 1 The trading process

Our study mainly focuses on the EC trading process of the Zhen Qin Food Market, and
we try to find any room for improvements in it. We separated the process into five parts
and we describe below problems that might occur in each step, as follows:
(1) Register, log in and subscribe online: the problems in this step are:
a Customers’ data leaking out: when the customers register with the account, it is
important to keep their data confidential and keep it secure.
b Fraud: if the customers’ data is out, it could be used by fraudulent organisation.
The fraud problem happens every month, so it is very important to take care of
this problem.
(2) Subscribe by fax or telephone: the problems in this step are:
a Products: purchasing products from the internet will yield uncertainty to
customers because customers cannot see or touch the products in person, which
is especially important in case of agricultural products. Customers require
clearer labelling and they might argue with the company about the products’
pictures discrepancy with real products.
b Payment: due to many fraud cases, people tend to mistrust the online payment
systems and ATM payment method.
(3) Customer service centre, confirmation: the problems in this step are:
a Products: customers may ask for the products’ descriptions, such as where the
manufactures are, how the products are produced (including the ingredients of
the products) and the types.
b Logistics: during national holidays (e.g. Chinese new year) delivery may be
delayed, which would elicit complaints from customers. In addition, delivery
mistake (wrong address, product, time, etc.) increases logistics cost.
 Case study of agriculture products e-market shop in Taiwan 107

(4) Picking products, delivery and getting products: the problems in this step are:
a Picking products and delivery: damaged or overdue products delivered to
customers would cause extra cost for returning products.
b Express and courier: in cases of shipping out the wrong products or in case the
products are damaged or overdue, the reverse logistics cost will be also higher.
(5) Customers’ response: the problems in this step are:
a Complaint: customers may complain about the quality and price of products or
the delay in delivery.
b Products: customers may also complain that pictures on the website are different
from how the real products look like.
c Returning products: when returning the products, customers have to mail it back
to the company which is inconvenient and generates extra costs.
Zhen Qin Food Market is an online retailer mainly selling Farmers’ Association’s
products. Though there are only three employees taking care of this online shop, thanks
to the complete managing system it runs successfully. However, with the expansion of
the business, there are lots of new issue mentioned above.

5 Empirical results and discussion

This study collects the suggestions and complaints of customers by telephone interview
and questionnaires. The classification of interview results included complaints,
compliments, satisfied customers, customers with no opinion, suggestions and mix of
those. There were 143 customers who choose satisfies, accounting for 46% of the total
survey group, and 50 people choose satisfied and suggestion, accounting for 16.1%.
Customers who chose complaint, and satisfied and complaint accounted for 11.8%. The
collection shows that there is still room for improvement of the Zhen Qin Food Market.
There were 13 customers complaining about the security on the internet not being
strong enough, which accounted for 27.6% of all complaints, and 11 customers
complained about the qualities of products being inferior because they received it
damaged or overdue (23.4%). Then, nine customers complained about the process of
choosing products and inventory management because they received wrong products
(19.1%). Other minor complains included technical problems with the internet
(instability).
As for the compliments, 21 customers admired the EC trading system of the Zhen Qin
Food Market (48.8% of all compliments). They mainly admire the fluency of the online
purchase process. However, there are still 22 customers thinking that there is still room
for improvement in the internet system. All the minor complaints concerned the services
of logistics company, the qualities of products and the online store management being not
good enough, which account for 11.6%, including totally 15 complaints.
In the suggestions received from the survey, 25 customers focused on the suggestions
about products (33% of all suggestions). They suggest that the store provide choice of
products. Then, 22 customers (29.3%) suggest that the Zhen Qin Food Market should pay
more attention to the stability of the website. Another 18 customers suggest that
108 C-H. Wang et al.

the logistics system is neither efficient nor precise enough, and they also suggest the
company to call customers before the delivery of products.
To sum up, in the telephone interview investigation, customers complained mostly
about the internet issues. Therefore, improving the quality of online purchasing system is
the most important thing, because though it is a convenient channel, there are still some
drawbacks including the lack of physical contact with the product and customers’
personal data safety concerns.

5.1 Analysis of the questionnaires of Zhen Qin Food Market

5.1.1 Distribution of the questionnaires
We delivered the questionnaires online, and using the addressees are all the registered
customer of the Zhen Qin Food Market. The data collection period was between 22
February 2009 and 17 April 2009 with total 115 questionnaires collected (the effective
response rate 87.8%).
In this study, we use the Cronbach’s alpha value to check the consistency of the
questionnaires. Murphy and Davidshofer (1988) indicated that if the value of Cronbach’s
alpha is below 0.6, then the data is invalid; if it is 0.7, then the data has low standard; if it
is between 0.8 and 0.9, the data is of intermediate standard; if it is over 0.9, the data is of
high standard. Nunnally (1967) suggested that in initial research, the value of Cronbach’s
alpha should be between 0.5 and 0.6, in the basic research 0.8, and in applied research
between 0.9 and 0.95.
The values of Cronbach’s alpha for our questionnaire are shown in Table 2. The
Cronbach’s alpha of these four aspects show that the reliability of out questionnaire is
high enough to do the following procedures.

5.1.2 Grey relational analysis

This research designed the questionnaires based on the 4Cs marketing mix and included
totally 35 statements. We then used GRA to calculate the grey relational grade and grey
relational order. The results are shown in Table 3 and Figure 2. According to Daniel
(1961), the number of key factors is usually between 3 and 6, thus we divide the 35
statements into 7 groups and discuss the first group (the lowest grade) and the seventh
group (the highest grade). The reason why we choose the first and seventh group to
discuss is that customers mainly agree with the statements in the first group and disagreed
with the statements in the seventh group. By looking through the statements in the
seventh group, we can see those are from customers complaining on the price of products
being too high, the insecurity of the internet, etc.
Table 2 The reliability analysis of the questionnaire

Aspects No. of questions Value of Cronbach’s alpha

Customer needs and wants 17 0.889
Cost to customer 3 0.714
Convenience 8 0.862
Communication 7 0.858
 Case study of agriculture products e-market shop in Taiwan 109

Table 3 Grey relational analysis results

Grey
relational
Statement order Order
The products sold in this website makes me satisfied 0.915207 1
This website constructs brand image as well as the physical store 0.893882 2
This website creates brand image of products 0.891241 3
The categories of products on the website are clear 0.889109 4
The pictures of fruits sold on the website are similar to the real 0.887789 5
products
This website creates good reputation and qualities of products 0.884844 6
The EC trading process of this website is clear and convenient 0.873978 7
This website provides satisfying guarantees, return and refund 0.873877 8
systems
This website provides sufficient categories of products 0.866786 9
This website provides discounts and sales regularly 0.865753 10
The customer service provided by the website is satisfying 0.864839 11
This website provides good purchasing environment and encourages 0.864128 12
me to purchase in the future
This website provides customised services (e.g. writing cards for 0.852551 13
customers)
There is no discrepancy between pictures on the website and real 0.852348 14
products
The website updates information about products regularly 0.851942 15
This website provides service to strengthen the loyalty of customers 0.842397 16
(e.g. bonuses)
Customer service representatives are equipped with professional 0.815232 17
knowledge
The prices of products sold on this website are reasonable and I am 0.776168 18
willing to purchase from there again in the future
The quality of the meat sold on this website is satisfying 0.758084 19
I prefer this online shopping website compared to others 0.751132 20
The logistics system of this website is trustworthy 0.728921 21
This website spurs customers to purchase 0.728007 22
The returning and refunding system of this website is efficient 0.727591 23
The products provided on the website are rare in the market 0.719864 24
This website provides efficient logistics services 0.718147 25
This website promotes customers to purchase 0.716098 26
This website provides searching engine to help customer’s to find the 0.700312 27
products quickly and correctly
The qualities of products sold on this website are trustworthy 0.69336 28
110 C-H. Wang et al.

Table 3 Grey relational analysis results (continued)

Grey
relational
Statement order Order
This website provides sufficient real-time interaction system and 0.69084 29
services such as discussion forum and telephone service centre
The prices of products are lower than in the market 0.637124 30
The website provides safe trading environment 0.614158 31
I prefer purchasing online rather than in physical store 0.611617 32
The website protects personal data of customers 0.611078 33
TV reports will attract customers to purchase on the website 0.609269 34
The advertisement of the website attracts customers to purchase 0.606447 35

Figure 2 Grey relational order (see online version for colours)

Through the high agreement with the statement ‘the products sold in this website makes
me satisfied’, we can see that customers are satisfied with the qualities of vegetables and
fruits sold in the Zhen Qin Food Market. The result of questionnaires in this matter is
consistent with the result of the telephone interview. The reasons of this phenomenon is
probably because the products sold in the Zhen Qin Food Market are mostly produced by
Taiwan Farmers’ Association and are mostly in seasonal products. Moreover, before they
are sold, they undergo quality and safety tests.
The reason why grey relational orders of ‘this website constructs brand image as well
as the physical store’, and ‘this website creates brand image of products’, are high is
probably that the Zhen Qin Food Market has been selling the agricultural products using
e-EC platform and opened trading and customer service departments since 1999. The
Zhen Qin Food Market is also supported by the Farmers’ Association of Taipei County,
Taiwan, which also helps to create better brand image. Some customers indicated that
they did purchase on other websites before but they chose the Zhen Qin Food
Market in the end.
The ‘Zhen Qin Food Market’s’ website categorises products into 20 sections and
provides key words search for customers too, which is the possible reason why the grey
relational order for ‘the categories of products on the website are clear’ is high.
The statements in Group 7 are ‘the prices of products are lower than in the market’,
‘the website provides safe trading environment’, ‘I prefer purchasing online rather than in
physical store’, ‘the website protects personal data of customers’, ‘TV reports will attract
customers to purchase on the website’ and ‘the advertisement of the website attracts
customers to purchase’.
 Case study of agriculture products e-market shop in Taiwan 111

Generally speaking, because the Zhen Qin Food Market operates through the internet,
the operation cost, including store rental and personnel expenses, is lower than of the
physical store. However, the logistics cost, including cold-chain logistics and notification
system, is rather high. In addition, the prices of vegetables, fruits and meat fluctuate
seasonally, which also rises up the price of products in the Zhen Qin Food Market. Only
during the promotional sale the price can be lower than in other stores. Therefore, the
statement ‘the prices of products are lower than in the market’ got such a lower score
from customers.
The two statements, ‘the website provides safe trading environment’ and ‘the website
protects personal data of customers’, are disagreed by customers because the fraudulent
organisations in Taiwan are a serious problem, often reported by media. This problem is a
serious concern and the Zhen Qin Food Market has to prevent the customers’ information
from leaking out or it may damage the brand image of the company.
The last two statements from Group 7, ‘TV reports will attract customers to purchase
on the website’ and ‘the advertisement of the website attracts customers to purchase’, are
also considered to less true. The reason is that the customers choose the Zhen Qin Food
Market mostly through the recommendation of their friends and relatives. Therefore, we
suggest that the Zhen Qin Food Market can try to appeal more to customers by increasing
the online exposure or by rewarding the customers who make recommendations.
The customers also disagree with the statement ‘I prefer purchasing online rather than
in physical store’, probably because an online store cannot provide the sense of reality
for customers.

5.1.3 Suggestions to improve the process

In the telephone interview’s results analysis, we discussed the complaints and suggestions
for the Zhen Qin Food Market by the category of complaint and suggestion. In the
analysis of questionnaires, we mainly focused on the statements in Group 7, because
those are the issues that customers are still dissatisfied with, including prices and safety
of the online shopping environment. In this section, we give the Zhen Qin Food Market
suggestions based on the issues defined in Group 7.
Firstly, in the complaint category, customers mainly complained about the insecurity
of online shopping. Secondly, customers complained about the quality of products and
insufficiency of product categories. Finally, customers complained about the products
being damaged or overdue upon the delivery.
In the suggestions category, customers mostly suggested that the Zhen Qin Food
Market add more local specialty products and also offer wider choice of products. Also,
customers suggested that the company can improve the trading process and the stability
of the online trading system. Furthermore, customers also suggested that the logistics
system should be improved by delivering products on time and notifying customers
before the products are delivered.
Our study presents the trading flow of the Zhen Qin Food Market before (Figure 3)
and after the improvement (Figure 4) designed according to the GRA results and
telephone interview’s results.
112 C-H. Wang et al.

Figure 3 Trading flow of the Zhen Qin Food Market before improvement

Figure 4 Trading flow of the Zhen Qin Food Market after improvement

Source: Our study.

There are two parts in Figure 3: frontal customer service centre, which customers can see
and interact with, and the backstage system, including machine and inner systems that
customers cannot see or interact with. The frontal customer service centre is a part of the
trading process from the subscription to finishing of the purchase. The backstage system
includes:
1 Information management system: this system mainly manages the information of
customers, such as their personal data, requests, etc., the system also manages the
information of products (categories, amount of products).
2 Website management system: this system manages the trading process, updating the
website and the safety of online trading.
 Case study of agriculture products e-market shop in Taiwan 113

3 Product management system: it manages the stock level, sales and also the selection
of products.
If we compare Figures 3 and 4, the main difference is that we added items ‘telephone
notification’ and ‘confirm again before delivery’.
x Telephone notification: in the past, the Zhen Qin Food Market called customers on
the delivery day. However, the customers who ordered products that were
unavailable at the moment of placing the order were not notified about the delay,
which would occur in this kind of situation. In this case, during the rush periods like
Chinese new year, the delivery might be delayed for up to three days. Therefore, we
suggest that the Zhen Qin Food Market should inform all the customers on the
availability of the ordered products, so that they can know how long they need to
wait for the delivery.
x Confirm again before delivery: the Zhen Qin Food Market designated the logistics
company to call customers before the products are delivered, even though customers
have been asked to choose preferred delivery time. It is possible that the delivery
time may change due to different factors such as weather, traffic, etc. Therefore, if
the logistics company can inform customers just before the products arrive, it would
be more convenient and efficient.
In addition, we present suggestions on improving the backstage system as follows:
x Information management
– Reexamine the safety of the internet system: the internet system safety is
considered to be the most important issue for the ‘Zhen Qin Food Market’s’
customers. Complaints about this problem were both received through the
telephone interview and questionnaires and even in the discussion forum of the
company. Therefore, we postulate that reexamination of the website’s safety is
an urgent task to do.
– Updating product information: we suggest that when the new products are
available in store and some of the old products unavailable or their sale is on
hold, the information on the website should be updated immediately. Also the
prices of products during promotional sale should be updated to avoid
confusion. Some customers indicated that the prices of products on the website
and the prices of products printed on the direct mail are different and were not
updated until the customers called the Zhen Qin Food Market to inform about
the mistake.
x Website management
– Create a stable and safe online shopping environment: during the telephone
interview, customers mainly complained about the online trading system being
unstable and slow in updating. We suggest that the Zhen Qin Food Market can
use the original data recorded by the server to analyse the customers’ activities
on the website, such as when a customer enters the website, what page dose
he/she look at and for how long he/she stays on each of them.
114 C-H. Wang et al.

– Click rate: using this simple data, we can determine the most popular page of
the website through. For example, if the page with the highest click rate
‘products on sale’, then we can add the information about other relative products
in the banner to rise up the exposure rate.
– Improvement of purchasing process: the record of customers’ activities on the
website can show the company where the website should be improved. For
example, if customers spend most time on the ‘payment’ page, then we can
guess that customers feel confused by the payment process or that it is very
important step for them, so they are more careful in proceeding with it.
Changing the website from business-oriented to customer-oriented can be
achieved by changing the purchasing process according to the information about
website traffic data.
x Product management
– Finding a standard process of product selection: during the telephone interview,
some customers complained that there is not enough products’ categories, and
some customers also suggested that the Zhen Qin Food Market provides tryouts,
free trials and more choices on the package size. Therefore, the study suggests
that the company should have a standard process of product selection process for
selecting new products and taking out of the website less wanted products. The
standard of product selection process for the Zhen Qin Food Market is
summarised in Table 4.
In the past, the product selection process of the Zhen Qin Food Market was conducted by
the employees. Firstly, they searched and collected the data about quality products of
local Farmers’ Associations. Some local Farmers’ Associations had recommended their
products to the Zhen Qin Food Market as well. In that case, the employees had a meeting
with the Association to decide whether the products can be sold on the website or not.
Such meetings often included tasting and trying of the products.
We believe that if there is a standard of product selection process that is based on the
customers preferences, the process would be more objective and the product variety more
suitable for customers.
We suggest that the Zhen Qin Food Market should formulate the standard product
selection process. The process should include the information about products such as the
sales record, the reputation of the producer, customers’ opinion, packaging and the ability
to compete with other products. Also, weights should be assigned to each evaluated
element and tryouts and sampling organised for customers to experience the products and
get their opinions first. Furthermore, the decision is whether the products should be sold
on their website or not. In such case, customers would also join the selection process, and
if the feedback on the products is good, the company can provide wider range of the
product to satisfy customers’ needs. The design of standard product selection process is
shown in Figure 5.
 Case study of agriculture products e-market shop in Taiwan 115

Table 4 Standard of product selection process of Zhen Qin Food Market

Standard process Explanation and example

1 Understand the Understanding the information about the product, including the size,
information of producer’s reputation, competitor’s products and the reflection on the
products market
2 Use standard Using previously designed standard decision policy (if there is no such
decision policy policy, then creating it) for evaluation of the proposed product (e.g. paper
and assign sheet forms), and then giving weights (scores) to different elements of the
weights product quality
3 Customers’ Through tryouts and free trials, understanding the customers’ opinion and
testing estimating possible sales volumes, e.g. giving out samples in retail stores
4 Decision According to the evaluation described above and customers’ suggestions,
deciding whether the product should be sold on the website or not
5 Implement the Based on the results of step 5, the product information will be or will not be
decision added to website
6 Evaluation and Evaluating if the decision made was right or not. Getting feedback from
feedback customers who purchased the product

Figure 5 Comparison of the old and improved processes for product selection of the Zhen Qin
Food Market
116 C-H. Wang et al.

6 Summary and conclusion

Our study designed questionnaires and conducted telephone interviews based on the
customer-oriented marketing mix to find the room for improvement of the Zhen Qin
Food Market. Then we used GRA to extract the points that should be improved from the
survey’s results. Finally, we gave suggestions on improvement of frontal and backstage
systems of the company.
In our paper, we use a case study of agriculture products e-market, Zhen Qin Food
Market, to show how to improve a B2C online store. We use telephone interviews and
questionnaires with customers of the store and then use GRA to analyse the data. Based
on the analysis results, we suggest improvements to the EC system and the purchase
process. For the frontal stage system, according to GRA, we advise that the Zhen Qin
Food Market adds two steps in their trading flow: ‘telephone notification’ and ‘confirm
again before delivery’. Therefore, this study suggests that the Zhen Qin Food Market
should inform all the customers on the availability of the ordered products, so that they
can know how long they need to wait for the delivery. For delivery process, the logistics
company should confirm customers before the products are delivered.
In addition, this study presents suggestions on improving the backstage system which
consists of information management, website management and product management. We
advise that the Zhen Qin Food Market should be reexamine the safety of online system,
update their product information, improve the purchase process by analysing their
customers’ activities on the website and provide a standard process of product
selections process.
However, the safety of the internet system is considered to be most important issue of
online store that needs immediate improvement, since the customers indicate that the
problem is very serious. The government should provide the online safe trading
environment to prevent the customers’ information from leaking out or it may damage
the brand image of the online marketing system as whole. We believe our study can be
used as a reference by other researchers studying different kind of EC business models as
well as by the practitioners who are looking for ways to improve their online
marketplaces.

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