E-Commerce Logistics Service Quality - Research Journal

Journal of Electronic Commerce in Organizations
Volume 20 • Issue 1
E-Commerce Logistics Service Quality:

Customer Satisfaction and Loyalty
Siber Akıl, Sakarya University, Turkey
Mustafa Cahit Ungan, Sakarya University, Turkey*
ABSTRACT
With the recent developments in technology, globalization, and the COVID-19 pandemic, the volume
of e-commerce logistics activity has been growing rapidly. However, a literature review for this study
indicated that there is a lack of research on commerce logistics service quality. This study intends to
fill this gap in the literature. It aims to identify the e-commerce logistics service quality factors that
affect customer satisfaction. It is also interested in identifying if there is any relationship between
the satisfaction of e-commerce customers and their loyalty. Data from 1,562 e-commerce customers
living in Turkey were collected via a web-based survey. The results were analysed using structural
equation modelling. Timeliness, order condition, order accuracy, and order discrepancy handling were
found to have a positive effect on customer satisfaction. A positive relationship between customer
satisfaction and customer loyalty was also found.
Keywords
Customer Loyalty, Customer Satisfaction, E-Commerce, Logistics Service Quality
INTRODUCTION
To keep up with the competition, contemporary organizations need to continuously improve the
quality of the services they offer to their customers and ensure that more transactions can be made
electronically. Due to technological developments, globalization, and the COVID-19 pandemic,
e-commerce will be preferred by more companies and customers in the future.
Electronic commerce has increased productivity, reduced operating costs, and changed people’s
lifestyles and social aspects by performing many things initially considered impossible (Qin, 2009).
The COVID-19 pandemic, which has affected many countries worldwide, significantly affects social,
economic, and academic life. People use electronic commerce even for their daily shopping needs
because it is not safe to go out on the street, the rule of keeping the social distance, quarantines, and
prohibitions. With the beginning of COVID-19, a worldwide recession and a slowdown in industrial
activity were observed, while the growth rate in the electronic commerce and logistics sector, unlike
many other sectors, increased (Neger & Uddin, 2020).
COVID-19 has accelerated the spread of e-commerce to new companies, customers (i.e., elderly),
and new product types (i.e., groceries). According to the UNCTAD (United Nations Conference on
Trade and Development) report, the pandemic has caused a significant growth in e-commerce volüme
(https://unctad.org). This report shows that the two countries where the popularity of e-commerce
DOI: 10.4018/JECO.292473 *Corresponding Author

This article published as an Open Access article distributed under the terms of the Creative Commons Attribution License
(http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and production in any medium,
provided the author of the original work and original publication source are properly credited.
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has increased the most are Turkey and China. The e-commerce volume in Turkey’s January-June
period of 2020 increased from $ 9.98 billion to $ 14.2 billion (https://www.aa.com.tr). Even when
the COVID-19 pandemic stops, the e-commerce sector is expected to continue to grow (Pantelimon
et al., 2020).
It is very likely that some of the behaviors adopted by consumers during the pandemic will
become new normal, meaning that consumers will get used to new shopping methods (Guthrie et al.,
2021). In parallel, customer expectations have also been increased. People nowadays expect to receive
their packages the next day, and their purchase decisions are becoming increasingly influenced by
shipment times. A survey conducted by Mckinsey showed that 46% of potential customers abandon
a shopping cart due to a shipping time that was too long or not provided, and 35% of customers who
did not purchase an item online due to long delivery times (https://www.mckinsey.com).
The growth of e-commerce volume has increased the importance of logistics activities and
caused this sector to face many opportunities but also challenges. Especially in the early stages of the
pandemic, even world giants such as Amazon, FedEx, and UPS had difficulties meeting the increasing
orders on time (http://www.thefamuanonline.com). Therefore, companies need to reconsider their
supply chains, inventories, and delivery systems (Roggeveen & Sethuraman, 2020).
It is widely accepted that the quality of logistics service partly determines customer satisfaction,
and thus firms gain the upper hand in the competition (Singh, 2021). In parallel, numerous factors
affecting the quality of logistics services are mentioned in the literature, and different studies use a
different set of constructs mainly due to methodological constraints. This study includes timeliness
(Zailani et al., 2018), order condition (Politis et al., 2014), order accuracy (Chaisaengduean, 2019),
and order discrepancy handling (Sutrisno et al., 2019) as they are considered as the leading factors.
It has been suggested in various studies that the quality of logistics services contributes to
customer satisfaction (e.g., Grant et al., 2014). In recent years, gaining new customers is more
expensive, time-consuming, and requires more effort than retaining existing customers due to the
intensity of competition (Javed & Wu, 2020). Customer loyalty has therefore become a major concern
and strategic issue for businesses. The majority of the research (e.g., Liao et al., 2017) has found that
customer satisfaction has a significant positive effect on customer loyalty but not all (e.g., Mittal &
Kamakura, 2011).
This study aims to determine the factors affecting customer satisfaction and the relationship
between customer satisfaction and customer loyalty in the e-commerce climate. Some studies are
investigating the relationship between these factors in bricks and mortar businesses. On the other
hand, to our best knowledge, there is a lack of studies investigating the relationships mentioned above
in e-commerce content. Choi et al. (2019) pointed out that literature on the e-commerce logistics
service quality is insufficient. Therefore further research is needed on leading variables.
As explained above, the increasing e-commerce volume has affected customer behavior and
caused many new companies to enter this field. This has led to reconsider the relationships between
logistics service quality factors, customer satisfaction, and loyalty. This is the major motivation for
the authors to undertake this research.
In this study, the following research questions will be answered:
(1) What e-commerce logistics service quality factors affect customer satisfaction?
(2) Is there any relationship between customer satisfaction and loyalty in the e-commerce
environment?
The paper’s outline is as follows: literature review and hypothesis development; methodology
and results; theoretical contributions and managerial implications; limitations and suggestions for
future research.
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LITERATURE REVIEW AND HYPOTHESIS DEVELOPMENT
Logistics Service Quality

High-quality service delivery strengthens corporate brands and contributes to customer satisfaction.
Therefore, the quality of service has become an important issue of interest to both practitioners and
academicians. To compete successfully in the future, companies need to define how service quality is
perceived by consumers and improve it. Logistics creates an opportunity for companies to differentiate
themselves from their competitors (Leuschner & Lambert, 2016). On the other hand, logistics service
quality emerges as a result of comparing the expectations and perceptions of customers (Giao et al.,
2020).
Therefore, since customers’ perceptions of quality may differ, the factors affecting it must also
be accurately identified. Service quality has varying characteristics depending on the nature of the
service (Chaisaengduean, 2019). To improve the quality of logistics processes that directly affect the
benefit of customers from the products they buy, it is necessary to improve the concrete aspects of
the logistics service as well as manage the customer’s expectations (Gil-Saura et al., 2008).
Customer Satisfaction
Globalization has emerged as a significant force shaping firms’ business policy and strategy in the
last few decades. Customer satisfaction is seen as essential and becoming a key factor of business
strategy as firms gain customers by competing effectively in an increasingly difficult globalized
market (Chin et al., 2013). Logistical activities provide time and space benefits to customers and thus
affect customer satisfaction (Mentzer et al., 2001). It is positively related to the quality of products or
services provided to the customer (Yeo et al., 2015). According to McKnight et al. (2017), delivery
performance will have a stronger impact on dissatisfaction than satisfaction, as customers want every
seller to at least deliver the product.
Customer satisfaction is a term used to indicate how happy customers are with a company’s
products, services, and capabilities (Priyanka & Monica, 2018). Companies will be able to gain
a competitive advantage and maintain their position in the market if they improve the quality of
existing services to provide services that meet customers’ demands by anticipating customer needs
(Chen et al., 2019).
In the literature, logistics service quality has been shown to have a positive effect on customer
satisfaction (e.g., Suresh et al., 2020). Customers’ needs in different segments regarding the dimensions
of logistics service quality (e.g., timeliness) are different, and satisfaction levels may be affected. The
focus of attention of every organization should be the customers and their preferences (Kadłubek,
2020). Logistics providers need to understand how customer preferences differ between logistics
service quality dimensions and how these dimensions affect satisfaction levels (Mentzer et al., 2004).
Customer Loyalty
Customer loyalty is one of the critical success factors in e-commerce, leading to increased long-term
profitability (Wu & Li, 2018). Customer loyalty is a measure of the customer’s positive attitude
towards the service provider and thinking of the only same provider when the same service is needed.
Customer loyalty can vary from a fully loyal customer to a customer who will never think of using the
same provider in the future (Gremler & Brown, 1996). A highly “loyal” customer is a customer who
regularly uses a service provider, really likes the firm, and does not think about using another service
provider for the same service. A customer who is extremely “nonloyal” is the one who will never use
the same provider again, has negative feelings towards it, and will be willing to try other providers.
Due to the intensification of competition, firms focus on building long-term relationships with
their existing customers and increasing their loyalty rather than acquiring new customers. Gaining
new customers is much more expensive and requires more effort than retaining existing customers
(Soh et al., 2015), so customer engagement is increasingly recognized as a way to achieve long-term
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success (Jang & Kim, 2012). For this reason, companies need to make improvements in the quality
of service to surpass their competitors by keeping their customers (Soh et al., 2015). Companies with
long-term customers can perform better financial performance than their competitors with lower
costs and high market share.
Logistics services are emerging as one of the effective tools for companies to build closer and
lasting relationships with customers and ultimately gain and maintain their loyalty (Jang & Kim,
2012). Studies in logistics report that operational elements related to product availability, product
status, delivery reliability, delivery speed, and relational elements such as communication and response
positively affect customer satisfaction and purchasing habits (Stank et al., 1999). Previous studies
found that logistics service quality affects customer loyalty (e.g., Fernandes et al., 2018). Also, it
was found that the quality of logistics services directly or indirectly affects customer loyalty through
customer satisfaction (e.g., Rachmawati & Agus, 2020).
FACTORS AFFECTING LOGISTICS SERVICE QUALITY
Timeliness
Globalization and technological developments help today’s customers to reach more easily the products
they want. These customers also do not tolerate waiting, and therefore they expect that their orders
are realized at the promised time. Timeliness is one of the first-mentioned logistics service quality
factors in the literature. It is defined as the timely delivery of customers’ orders as promised (Zailani
et al., 2018). On the other hand, some authors define timeliness as the frequency of delayed orders
(Politis et al., 2014).
Timeliness is closely related to the workflow and efficiency of receiving, sorting, and sending,
especially choosing the mode of transportation (Yang & Wang, 2019). Timeliness can be considered
in four dimensions: total logistics cycle time, total production cycle time, delivery cycle time, and
new demand response time (Garcia et al., 2012). The total logistics cycle time is the average time
between placing an order, and the moment the order reaches the customer’s location. The total
production cycle time is the average time required to drill down and produce the product, including
quality control and packaging. Delivery cycle time includes vehicle loading/unloading time, traffic
delay time. Response time to new demand is the average time it takes for a supplier to respond to
a new supply request. Many studies in different sectors have found a positive relationship between
timeliness and customer satisfaction (e.g., Esmaeili et al., 2015).
H1: There is a positive relationship between timeliness and customer satisfaction.
Order Condition
Order condition is related to whether customer orders are intact in reaching the customer (Mentzer
et al., 2001). For the customer, the condition of the delivered goods, as well as the fast and complete
delivery, is critical. If they are not well protected, the products may be damaged during transportation.
The customers want to receive the ordered product intact. Otherwise, they may choose a different
supplier in the next purchase. Therefore, it is necessary to determine the factors that may affect the
order condition (Zlatkovic, 2013).
Companies need to ensure that customers’ orders are safely and appropriately maintained, as the
products may be damaged during the numerous transfer and handling processes required until they
are delivered to the customer. Since customers cannot use damaged products, correction procedures
must be performed with suppliers or other vendors depending on the source of the damage (Mentzer
et al., 2001). The order condition may be negatively affected by some factors such as transport mode
selection and packaging. For this reason, improvements are needed in delivery services, such as the
use of special packaging for liquid products or glassware, to ensure the safe delivery of the product
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to customers. Damaged or defective product deliveries to the customer will result in customer
dissatisfaction with product return or order cancellation (Vasic et al., 2021).
Previous studies report that order condition affects customer satisfaction and loyalty (e.g., Sutrisno
et al., 2019), particularly damaged orders have been found to significantly reduce the customer’s level
of satisfaction with logistics services. Also, the delivery of products with damage will cause customer
dissatisfaction and bring additional costs to the company, such as product retrieval and repair.
H2: There is a positive relationship between order condition and customer satisfaction.
Order Accuracy
Customers prefer that the products they order are delivered in the quantity and quality specified
at the order stage, and substitute products are not sent. Order accuracy is defined as whether the
delivered products are the correct ones with correct quantities (Politis et al., 2014). To talk about
order accuracy, the logistics service provider must fully understand and perform the logistics service
that the customer requests (Jang et al., 2014).
Order accuracy is related to the courier service’s accuracy in delivering orders placed by clients
(Hendayani & Dharmawan, 2020). The return of products is strongly associated with the accuracy
of the order delivered to the customer (Xing et al., 2011). Order inconsistency’s effect on customer
satisfaction may vary from region to region due to different levels of tolerance for errors (Mentzer et
al., 2004). Previous studies (e.g., Chaisaengduean, 2019) in different sectors have found a positive
relationship between order accuracy and customer satisfaction.
H3: There is a positive relationship between order accuracy and customer satisfaction.
Order Discrepancy Handling

Order discrepancy handling refers to how well a company addresses the inconsistencies experienced
in the order fulfillment process after receiving the customer’s order. It has several dimensions, from
easily reporting an order inconsistency to the logistics company to a hassle-free return of wrong
products. After a customer reports an incorrect, bad, or poor-quality product, the firm takes steps to
improve the customer perception of logistics service quality (Mentzer et al., 2001). Order discrepancy
handling can be time-consuming and will impose additional costs on the company. However, in today’s
highly competitive environment, companies must understand that product returns are inevitable, and
more importantly, return management can help save costs, identify areas for improvement, develop
stronger customer relationships, and contribute to the long-term growth of the firm (Chen et al.,
2017). Online retailers must manage the flow of products returned by customers in a way that does
not affect customer satisfaction or sales (Walsh et al., 2016).
Several studies in the literature examine order errors and how satisfactory the response to them
is, and the adequacy of the reporting process. (e.g., Kilibarda et al., 2019). Vakulenko (2019) stated
that retailers do not understand the impact of delivery and return processes on customer satisfaction
and loyalty but rather as necessary. Firms’ performance in handling product returns has been found
to play an essential role in influencing customer loyalty (Ramanathan, 2011). In their study, Javed &
Wu (2020) showed that customer satisfaction and trust in post-delivery services, which they consider
product exchanges, returns, and financial refunds in electronic commerce, significantly mediate
repurchase intention, a dimension of customer loyalty.
Especially for clothing items, customers consider it important whether they can easily return the
products due to possible color and size incompatibilities (Zhang et al., 2015). However, even though the
logistics company has done its best to resolve inconsistencies, customers can often feel disappointed
and unsatisfied. (Sutrisno et al., 2019). Various studies (e.g., Masudin et al., 2020) determined that
order discrepancy handling is effective in evaluating the logistics service quality by customers. A
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positive and significant relationship was found between the management of order discrepancies and
customer satisfaction (Gaudenzi et al., 2021).
H4: There is a positive relationship between order discrepancy handling and customer satisfaction.
Relationship Between Customer Satisfaction and Customer Loyalty

Customers’ overall satisfaction with a service provider affects their loyalty (Lewin, 2009). Nevertheless,
customers who are satisfied with the offered product or service may not remain loyal to the company,
especially if they have different options. On the other hand, it is also seen that a dissatisfied customer
can remain loyal to the company when there is no better alternative.
Customer satisfaction and loyalty are unquestionably two important behavioral outcomes that
each service firm aspires to accomplish (El-Adly, 2019). It would be appropriate to talk about
customer satisfaction when the performance of a product or service offered by a company exceeds
the customer’s expectations, and a loyal customer when the customer comes back several times
to purchase a service from the same company (Meesala & Paul, 2018). Positive and long-term
interactions with customers, which are generally the result of customer satisfaction arising from the
quality of the service offered to customers, are reflected in the company’s profit (Kadlubek, 2020).
Customers’ satisfaction or dissatisfaction with the purchase may affect their subsequent behavior.
Satisfied customers are more likely to repurchase the product. Also, satisfied customers tend to
say good things about the brand to others. That is why many marketing professionals say “satisfied
customers do the best advertising”. Customers who are not satisfied will be able to give up or return
the product, complain to the company, publicly announce their dissatisfaction, take particular actions
such as not rebuying the product or warning their friends. Therefore, e-commerce companies need
to increase customer satisfaction, optimize their shopping experience, and encourage them to adopt
more positive post-purchase behaviors (Luo et al., 2020).
Customer satisfaction has a significant impact on company performance and can lead to customer
loyalty (Lewin, 2009). Oliver (1999) noted that while loyal customers are satisfied in the general sense,
satisfaction does not necessarily mean loyalty. To explain the relationship between satisfaction and
loyalty, this author states that it is necessary to investigate which aspect of customer satisfaction affects
loyalty. The same author indicates that satisfaction is necessary for loyalty formation, but ultimate
loyalty arises as a combination of perceived product superiority, social bonding, and synergistic effects.
Previous studies have found that customer satisfaction plays a mediator role between service
quality and customer loyalty (Javed & Wu, 2020), that customer satisfaction directly affects customer
loyalty (Gautam & Sharma, 2021), and that there is a positive linear relationship between customer
satisfaction and repurchase intent (Choi et al., 2019).
Narayandas (2005), on the other hand, found that satisfaction and loyalty were little related. This
author stated that making purchases from a company does not mean that they are loyal to it. Companies
should develop positive relationships with customers, and thus customer loyalty can be increased over
time. Singh & Saini (2016) have found that satisfaction in retail services has no significant impact
on customer loyalty. Service quality and satisfaction are essential prerequisites for customer loyalty.
However, it is rare for today’s customers to show lifelong loyalty to a firm. Indeed, their degree of
satisfaction with products or services tends to continue until they encounter a competitive product
and service whose quality and price are more attractive.
H5: There is a positive relationship between customer satisfaction and customer loyalty.
The research model was created based on the discussions provided in Figure 1.
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Figure 1. Research model
METHODOLOGY
As a research design, the quantitative method was employed. Data were collected through a web-based
questionnaire. Because of its advantages, such as access to distinct demographics and covering a large
geographic area at relatively low costs in a short length of time, the web-based survey was deemed
the most suited. Furthermore, an online survey is more similar to an online purchase experience. The
questionnaire and covering letter that outlined the objectives of the study were provided via https://
www.online-anket.gen.tr/. For the data collection, a convenience sampling procedure was adopted.
Convenience sampling is a nonprobability sampling where people are sampled because they are easy
to reach (Hair et al., 2020). The online survey was posted on social media sites to reach the targeted
population with this sampling strategy. The group members were then friendly asked to share the
questionnaire link to their contacts. In other words, a “chain referral” recruitment approach was used.
As a result, in addition to the original point of contact, the link was shared with potential respondents,
and so on. When the respondents clicked on the link, they were directed to the Web-based questionnaire.
The population of the research consists of individuals using electronic commerce in Turkey. In
total, 1562 samples were collected. There was no missing sample as the survey website automatically
eliminated uncompleted survey forms. Due to the nature of sampling, the response rate cannot be
calculated because it is unknown how many potential respondents did not participate even if they
saw the survey. Regarding the sample size, there are different approaches in the literature. However,
the highest is 20 observations per indicator variable (Kline, 2015). A sample size of 660 (33*20) is
required to reach sufficient statistical power. As a result, it was concluded that the sample size of this
study (N=1562) is much larger than the minimum required.
The questionnaire used for this study consisted of three parts. The first part contained a brief
introduction, which explained the research objectives and instructions to fill out the survey form.
In this part, the potential participants were asked to complete a completely voluntary anonymous
online questionnaire that took about 10-15 minutes to complete. They also were asked to think about
the website that they shop for the most frequently when answering the survey questions to ensure
consistency across responses.
The second part was about the sample demographics and purchasing habits of potential
respondents. The third part included the study constructs employed in this study. Six constructs were
measured: ‘order discrepancy handling (ODH)’, ‘timeliness (TM)’, ‘customer loyalty (CL)’, ‘order
condition (OC)’, ‘customer satisfaction (CS)’, ‘order accuracy (OA)’. These constructs were chosen
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as we identified them as the leading logistics service process factors. The items in each construct were
obtained based on a comprehensive literature review and the opinions of academics and practitioners.
The constructs included in this study and the items associated with them are presented in Table 1.
Table 1. The constructs included in this study and the items associated with them are presented here
The scale for order accuracy was adapted from Bienstock et al. (2008), Mentzer et al. (2001); the
scale for order condition was adapted from Gil-Saura & Ruiz-Molina (2011); the scale for timeliness
was adapted from Bienstock et al. (2008); the scale for order discrepancy handling was adapted from
Bienstock et al. (2008); the scale for customer satisfaction was adapted from Gil-Saura & Ruiz-Molina
(2011), Stank et al. (1999); and the scale for customer loyalty was adapted from Stank et al. (1999).
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All of the constructs were measured on a 5-point Likert-type scale as follows: 1=strongly disagree,
2=disagree, 3=neutral, 4=agree, 5=strongly agree.
RESULTS
Before presenting the results, non-response bias and common method variance tests were conducted.
The non-response bias test indicated that there are no significant differences between the early and
late responses. Harman’s single-factor method was used to assess the Common method variance. The
factor analysis produced six different factors. Therefore, it can be concluded that common method
variance is not a problem for this study.
Sample Profile
The profile of sample firms is shown in Table 2. The distribution of female (49.5%) and male (50.5%)
respondents was relatively balanced. 83.2% of the participants are younger than 45 years old. The
sample is well-educated, as 78.1% of the participants hold an undergraduate degree or higher. The
majority of participants (86.9%) do online shopping for more than a year. Most of the respondents
(31.8%) participated in online shopping activity at a frequency of several times per month. 58.0% of
participants work as an employee in the public and private sector. Most participants (32.6%) spend
10%-25% of their expenditures on the internet shopping. Food (99.9%), clothing (77.2%), book (66.6%),
and electronics (57.9%) is the most bought items, jewelry and watch (24.0%), and automotive parts
and accessories (15.35%).
Research Model Results

The analysis was done in two stages. For the first stage, an explanatory factor analysis using SPSS
21 was conducted. For the second stage, the partial least squares (PLS) approach using SmartPLS
3.0 was used to investigate the hypothesized relationships.
Exploratory phase
An EFA with varimax rotation was conducted to evaluate whether items were loaded on their
associated constructs. Before EFA, factor feasibility and sampling adequacy tests were performed.
Bartlett’s sphericity test was used to investigate the factor’s feasibility and showed that the factor
is feasible (p <0.000). KMO value of 0.944 showed that the sample is adequate for factor analysis.
In the initial analysis, OC4, OA4, CS4, CL1, and CL4 were eliminated due to cross-loading. After
this elimination, factor analysis was rerun and resulted in 6 factors explaining 74.62% of the total
variance (See table 3).
The first factor, termed ‘order discrepancy handling’, accounted for 17.62% of the total variance
and included eight items. The second factor, termed ‘timeliness’, accounted for 15.50% of the total
variance, including five items. The third factor, termed ‘customer satisfaction’, accounted for 12.41%
of the total variance and included four items. The fourth factor, ‘customer loyalty’, which made up
12.27% of the total variance, contained five items. The fifth factor, ‘order condition’, which made up
8.70% of the total variance, contained three items. The sixth factor, ‘order accuracy’, which made up
8.12% of the total variance, contained three items.
CONFIRMATORY PHASE
Measurement Model
The constructs were assessed in terms of convergent and discriminant validity (Anderson & Gerbing,
1988). For the convergent validity, the following criteria are applied: variable loadings should be
equal or greater than 0.60, composite reliabilities (CR) for each construct should be equal or greater
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Table 2. The profile of sample firms
than 0.8, and the average variance extracted (AVE) for each construct should be equal or greater than
0.5 (Henseler et al., 2014; Fornell & Larker, 1981; Hair et al., 1998).
Factor loading is the correlation coefficient for the variable and factor. Composite reliability is
a measure of internal consistency in scale items (Netemeyer, 2003). The average variance extracted
(AVE) is a measure of the amount of variance that is captured by a construct in relation to the amount
of variance due to measurement error (Fornell & Larker, 1981)
As shown in Table 4, all of the criteria for convergent validity are being met. A procedure
suggested by Fornell & Larker (1981) was followed to assess discriminant validity. According to this,
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Table 3. Variance total
first, the square root of AVE for each construct was calculated. Then, it was checked if the square
root of the AVE of a construct is greater than the correlations between the rest of the constructs. No
multicollinearity problem was detected between the independent variables as the variance inflation
factors (VIF) for all indicators ranged between 1,469 and 4,292, and for constructs ranged between
2,253 and 2,727, which are far below the threshold of 5 (Ringle et al., 2015). (Table 4)
The results of the discriminant validity assessment are shown in Table 5. As seen from the table,
the square root of AVE is greater than all of the correlations for each construct, and therefore it can
be claimed that discriminant validity is achieved. The correlation matrix indicates that customer
satisfaction has a significant positive correlation with all of the factors (order discrepancy handling;
p<0.001; order accuracy; p<0.001, order condition; p<0.001, timeliness; p<0.01). There is also a
significant positive correlation between customer satisfaction and customer loyalty (p<0.001).
Before analyzing the hypothesized relationships, the predictive validity, explanatory power, and
model fit were assessed.
Cross-validation communality and redundancy indices are checked to evaluate the predictive
validity of the structural model (Tenenhaus et al., 2008). The Q2 statistic determines the model’s
predictive significance by having the model reproduce the observed values. A Q2 is greater than 0
means the model has predictive relevance (Fornell & Cha, 1994). Also, 0.02 represents a “small”
effect size, 0.15 represents a “medium” effect size, and 0.35 represents a “high” effect size (Cohen,
1988). In Smart PLS, two kinds of Q2 statistics are estimated: cross-validated commonality and cross-
validated redundancy. While commonality is calculated for all constructs and indicators, redundancy
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is only calculated for endogenous variables. As it can be seen in Table 6, all Q2 values are positive and
Table 4.
Table 5.
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greater than 0.35; therefore, it can be concluded that the model has predictive validity. See Table 6
Table 6.
The model’s explanatory power was assessed using the coefficient of determination (R2) of the
endogenous constructs. The results of the structural model analysis are shown in Figure 2. The path
coefficients, their significance levels, and the R2 values of endogenous constructs can be seen in Figure
2. Based on the scores of R2, it can be interpreted that the model explains 54.4% of the variance of
customer satisfaction and 58.6% of the variance of customer loyalty. These are substantial as they
are greater than 26% (Cohen, 1988).
Figure 2.
The model’s quality of fit is measured using the standardized root mean square residual (SRMR)
(Henseler et al., 2014). The SRMR is defined as the difference between the observed correlation
and the model implied correlation matrix and indicates whether the model sufficiently explains the
empirical data. The SMRM value of 0.063 indicates a good model fit as it is lower than the threshold
of 0.08 (Hu and Bentler, 1998).
Table 7 shows the results of the hypothesis testing.
All of the hypotheses were accepted.
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Table 7.
CONCLUSIONS
Research Summary and Conclusion

This study aimed to determine the effect of electronic commerce users’ evaluations about logistics
service quality on customer satisfaction and the relationship between customer satisfaction and
customer loyalty.
A positive relationship was found between timeliness and customer satisfaction. This finding
is consistent with the findings of other researchers (e.g., Esmaeili et al., 2015). Timeliness requires
that the ordered product is delivered to the customers completely and robustly at the time promised
at the order stage. When the product delivery date to the customers occurs later than the specified
date, the customers may not benefit from the product as expected. In this case, the customers may
choose another company for their next purchase.
A positive relationship was found between order condition and customer satisfaction. Other
studies also support this finding (e.g., Zlatkovic, 2013). It requires that the ordered product should be
delivered to the customer undamaged and intact. To ensure this, the products should be stored with
appropriate packaging that will not be damaged in handling, transportation. Anti-spoilage measures
should also be taken, especially in products with special resistance restrictions, such as health and
food products, taking into account the transport time.
A positive correlation was found between order accuracy and customer satisfaction. This finding
is in line with the findings of other studies (e.g., Chaisaengduean, 2019). In case of incorrect delivery,
correcting this error causes a loss of time and will bring additional costs to the company. The customer
who does not receive the ordered product correctly will remember this experience in the following
order and therefore may not place an order to the same company again.
In this study, a positive relationship between order discrepancy handling and customer satisfaction
was found. Previous work (e.g., Sutrisno et al., 2019) supports this finding. For some customers, a
company’s approach to address post-order issues is more important than smooth shopping. On the other
hand, some customers are not interested in how the problem is handled because their dissatisfaction
will not turn to satisfaction.
Another important finding of this study is that customer satisfaction affects customer loyalty.
This finding is consistent with several other research (e.g., Gautam & Sharma, 2021).
Theoretical Contributions, Practical Implications

This study makes some contributions to the e-commerce literature. First, a unique model was created
for investigating the relationship between logistics service quality factors, customer satisfaction,
and loyalty. It is unique because the set of logistics service quality factors’ (i.e., order condition,
order accuracy, order discrepancy handling, and timeliness) impact on customer satisfaction were
examined for the first time. This study was added to the literature that there is a positive and significant
14
relationship between customer satisfaction and customer loyalty. Previous studies in the e-commerce
context focused on repurchase intention, which is a sub-dimension of loyalty. This current study
departed from them in that sense. Second, the large sample size and thereby higher reliability of the
results than other survey studies in this area makes a significant contribution to the literature. Third,
identifying the relative effects of logistics service quality factors on customer satisfaction may inspire
academics to focus on these factors for further research.
The findings of this study have several important managerial implications. First of all, in this
study, the relative effects of logistics service quality factors on customer satisfaction are identified.
This finding will help companies allocate their resources accordingly by knowing which logistics
service factor requires more attention to increase customer satisfaction and loyalty.
Second, the findings imply that high rate of success in logistics quality factors require a
comprehensive approach and companies need to invest in technology, supply chain infrastructure,
and people. Companies that want to gain customer satisfaction with logistics service quality can use
technology to improve their operations and minimize human error. Thanks to advanced technologies,
companies can monitor all stages of the process from order to delivery and offer alternatives to
customers at the order stage until the delivery date. Investing in digital technologies like augmented
reality, drones, advanced robotics, and smart glasses for hands-free select, pack, and ship is essential
for lowering costs and ensuring the company’s competitiveness and customer satisfaction. For example,
drones provide fast and contactless delivery during the pandemic. Logistics personnel should be
trained in logistics practices and technology used to minimize human-related errors.
The rapid growth of e-commerce marketplaces will necessitate a similarly quick and innovative
response from the logistics industries. Decisions about modes of transportation, warehousing, material
handling, and packaging should all be reconsidered to provide more efficient solutions. E-commerce
companies need to expand their distribution networks, build more fulfillment centers, change the
composition of fleets to accommodate an increase in last-mile delivery, and build partnerships with
local retailers. It should be noted that logistics practices for brick and mortar businesses do not work
for e-commerce companies. For example, e-commerce needs more than three times more logistics
space than traditional stores as it requires a wide variety of SKUs, more buffer stocks, more space
for processing returned items, etc.
Third, the process of resolving order discrepancies must be well managed so that the company
can establish a long-term relationship with the customer. For a consumer who has had negative
experiences to purchase from the same company again, the customer must be satisfied with the
resolution of the problem in the prior purchase. For example, in return or exchange transactions, the
company should take the product from the customer’s address without demanding a return fee, or it
should offer customers the option to make transactions from physical stores and give the impression
that the process can be carried out smoothly with similar solutions. Similarly, presenting a short
apology or small gifts to the customer along with the returned products may reduce the impact of
the negative experience of the customer.
Limitations and Future Research Directions

This study has certain limitations to consider in future research. Conducting an assessment with
survey data includes a subjective approach. Quantitative data may be used in future studies. As the
study was conducted in Turkey, the generalization of its results may be problematic. Future research
can be carried out on an international scale to determine the impact of countries’ social, economic,
and cultural differences on customer’s logistics service quality assessments. This study included four
process-related logistics service quality factors. Different set factors may be considered in the future
research. The relationship among the factors also warrants further research.
15
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Siber Akıl received her BS degrees in Industrial Engineering and Civil Engineering, and Master’s degree in
Production Management and Marketing from Sakarya University. She is currently a PhD student in Production
Management and Marketing at the same university. Her research is focused on electronic commerce and logistics.
She is a senior engineer at Turkish Postal Service.
Mustafa Cahit Üngan is a Professor of Operations Management in the Department of Business at the Sakarya
University where he has been a faculty member since 2009. Mustafa completed his Ph.D. at the University of
South Carolina. He holds an MBA from Fairleigh Dickinson University and an undergraduate degree from Atatürk
University. His research interests lie in the area of business process management, total quality management,
supply chain management, and technology management. Mustafa has been serving as the Dean of the School
of Management since 2020.
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Journal of Electronic Commerce in Organizations

E-Commerce Logistics Service Quality:

DOI: 10.4018/JECO.292473 *Corresponding Author

LITERATURE REVIEW AND HYPOTHESIS DEVELOPMENT

Logistics Service Quality

FACTORS AFFECTING LOGISTICS SERVICE QUALITY

H1: There is a positive relationship between timeliness and customer satisfaction.

Order Discrepancy Handling

Relationship Between Customer Satisfaction and Customer Loyalty

Figure 1. Research model

Research Model Results

Table 2. The profile of sample firms

Table 3. Variance total

Research Summary and Conclusion

Theoretical Contributions, Practical Implications

Limitations and Future Research Directions

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