CONSUMER LOYALTY IN SHARING ECONOMY - A CASE ON TRANSPORT SHARING ECONOMY - DIVA
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Consumer Loyalty in
Sharing Economy
A Case on Transport Sharing Economy
Authors: Rownak Tabassum Orthee;
Linfeng Wang
Examiner: Dr. Anders Pehrsson
Term: Spring 2021
Course: Business Administration with
specialization in Marketing, Degree Project
(Master)
Course code: 5FE05E
Course credit: 30 HPAcknowledgements
From the day one till date, it has been a journey that can never be forgotten. Doing classes online
became offline in just a matter of months and now, it is the new normal! And the days had passed
but the value injection from the people we came across, never stopped!
Today is the day that we have waited for a long time. The perseverance and the passion took a toll
of us and in the end, we can happily say ‘all the troubles are worth it’. The troubles that we found,
we had to go to Dr. Anders Pehrsson. There have been instances where we felt everything were
falling apart but he was there to support us with his wisdom, virtue, and guidance.
Lastly, the peers from the program are the people who have provided continuous support. It has
been quite an experience. Our family is needed to be remembered on this day since they are the
ones who sacrificed the most for us.
Regards
Rownak Tabassum Orthee
Linfeng Wang
iAbstract
Sharing economy (SE) has become a major business on a global stage, given that many of the
companies involved have grown to become some of the leading firms in terms of investment and
reach. Examples include companies in the transportation and car service sectors along with the
lodging services. Some of the famous companies are Lyft and Uber in the transport sector and
Airbnb in accommodations. As the SE gains ground, there are new challenges presented in
understanding customer loyalty. Traditional studies on customer loyalty focused on understanding
why consumers remained loyal to one service provider, which wasstraightforward. However, SE
is a challenge because more than one provider gives service. Themain purpose of this research was
to understand how the various antecedents of customer loyalty along with the traits of SE influence
the loyalty of consumers who utilize the SE services, specifically concerning the vehicle transport
and car services sharing economy. This research utilized quantitative methods through
questionnaires that gathered data from respondents who have utilized a website or app to engage
SE services in the transport sector. All antecedents of sharing economy tested such as perceived
value and perceived service quality were found to have a positive correlation to customer
satisfaction, which had, in turn, a strongpositive correlation with customer loyalty.
Keywords
Sharing Economy, Customer Loyalty, Transport Service
iiContents
List of Figures ...................................................................................................................................... 4
1 Introduction .................................................................................................................................. 5
1.1 Problem ................................................................................................................................. 5
1.2 Background ........................................................................................................................... 6
1.3 Purpose and Objective ........................................................................................................... 7
1.4 Research Questions ............................................................................................................... 8
1.5 Delimitation........................................................................................................................... 8
1.6 Research Structure ................................................................................................................. 8
2 Literature Review ......................................................................................................................... 9
2.1 Sharing Economy and Its Unique Aspects ............................................................................ 9
2.2 Customer Loyalty in Sharing Economy .............................................................................. 13
2.3 Improving Trust and Loyalty in Sharing Economies .......................................................... 15
3 Methodology ............................................................................................................................... 17
3.1 Research Design .................................................................................................................. 17
3.2 Research Paradigm .............................................................................................................. 17
3.3 Research Approach.............................................................................................................. 18
3.4 Research Process ................................................................................................................. 18
3.5 Participants Selection .......................................................................................................... 18
3.6 Sampling Method ................................................................................................................ 19
3.7 Data Collection Tools.......................................................................................................... 19
3.8 Data Analysis ...................................................................................................................... 19
3.9 Research Ethics ................................................................................................................... 20
3.10 Theoretical Framework ....................................................................................................... 20
3.11 Research Variables .............................................................................................................. 20
iii3.12 Hypotheses .......................................................................................................................... 20
3.13 Conceptual Framework ....................................................................................................... 21
4 Results and Analysis ................................................................................................................... 22
4.1 Descriptive Statistics ........................................................................................................... 22
4.2 Regression Analysis ............................................................................................................ 25
4.3. Results ..................................................................................................................................... 28
5. Discussion ...................................................................................................................................... 29
5.1. Theoretical Implication ........................................................................................................... 29
5.2. Managerial Implication ........................................................................................................... 30
6. Conclusion .................................................................................................................................. 31
6.1. Further Studies ........................................................................................................................ 33
6.2. Limitations .............................................................................................................................. 33
5 References .................................................................................................................................. 35
6 Appendices ................................................................................................................................. 40
Appendix 1 - Survey Questionnaire ............................................................................................... 40
List of Figures
Figure 1 Conceptual Framework .................................................................................................................... 21
Figure 2 Frequency Distribution of Age Group of Participants ..................................................................... 22
Figure 3 Frequency Distribution of Gender of Participants ........................................................................... 22
Figure 4 Frequency Distribution of Education Level of Participants............................................................. 23
Figure 5 Frequency Distribution of Geographic Region of Participants ........................................................ 23
Figure 6 Frequency Distribution of Level of Satisfaction of Participants ...................................................... 24
Figure 7 Frequency Distribution of level of optimism of Participants ........................................................... 24
iv1 Introduction
Sharing economy (SE) has become a major business on a global stage, given that many of the
companies involved have grown to become some of the leading firms in terms of investment and
reach (Cusumano, 2014). Examples include companies in the transportation and car service sectors
along withlodging services. Some of the famous companies are Lyft and Uber in the transport
sector and Airbnb in accommodations. These companies now operate in more than 200 countries
andhave a high value in the market compared to other car transport service companies in the world
(Huckle et al, 2016). This is even though these firms do not have direct ownership of the assets
such as cars that consumers use, and instead operate on a sharing economy. A sharing economyis
thus one that allows consumers to access goods and services from different peers who work
together to complete the customer needs.
Among different instances of sharing economy, car transportation has been popularized at a
relatively higher pace. Many organizations are coming forward in their region or globally to create
a platform where people can share transport through the incentive of mutual benefits. For the case
of transport services such as Uber, the firm provides an online platform that connects the per
service provider and the consumer (Barbu Bratu, and Sîrbu, 2018).
Sharing economy is growing at a faster rate and more people are adjusting to utilizing it daily.
This implies that there is a need to examine what aspects make SE useful to users, which will help
numerous businesses entering the market understand how to navigate the new market (Cusumano,
2014). This study will thus delve into the issues surrounding SE such as customer loyalty.
1.1 Problem
As the Sharing economy gains ground, there are new challenges presented in understanding
customer loyalty. Traditional studies on customer loyalty focused on understanding why
consumers remained loyal to one service provider, which was straightforward (David, Chalon,
and Yin, 2016). However, sharing economy is a challenge because more than one provider gives
service. Consumers understand firsthand that two sources of service are indirectly competing,
which thus makes itimportant for them to work together to provide a seamless service to make a
consumer feel attached to that particular combination. Moreover, some consumers have also
become providers, making service providers have a new edge in terms of the understanding value
of service, quality of service, and loyalty (Cusumano, 2014). For example, car services in a sharing
economy involvethe owner as a user and a service provider at the same time, which makes the
5platform a crucialmeeting place for consumers and adds a new dimension to the issues. This study
delves into how the various antecedents of customer loyalty such as service quality perceptions
and valueperceptions affect loyalty in a sharing economy. The world is moving toward sharing
resources as it adds many values to customers. Understanding the different merits of sharing
economy through the perspective of customers can allow businesses, investors, and academics the
magnitude of importance for the application of sharing economy in the future (Barbu &
Sîrbu,2018). Currently, there is little understanding that correlates customer loyalty and sharing
economy. This study also provides further insight into the characteristics of the sharing economy
through online platforms, and how these traits further impact loyalty.
1.2 Background
Sharing economy has various traits and characteristics that make it unique enough to warrant its
investigation as a separate economy. One characteristic is that the hared economy relies onthe
technological advancement to promote and utilize the content (Dirgová, Janičková, and Klencová,
2018). The sharing economy has been growing and expanding over time to incorporate different
examples such as file-sharing services. These file-sharing services allowusers to be consumers at
the same time because they can upload their content while using the content uploaded by others.
Another example is that the peer sharing economy is open-source software. Different types of
software are developed daily for profit as they are copyrighted. However, certain individuals
provide free software for those who cannot afford to purchase it and thus creates an online
community of like-minded individuals. The online collaboration in writing articles, sometimes the
same articles such as in Wikipedia or differentmaterials such as Instagram and YouTube provide
users with a wide range of information sources for free. Finally, peer-to-peer financing services
such as crowdfunding or micro- lending further provide a crucial evolution in the sharing
economy. Therefore, SE is a unique and evolutionary arena championed by the online platform
as a result of technologicaladvancement to enable sharing of ideas and has the potential to enable
business platforms basedon peer exchange of services (Üstündağlı & Güzeloğlu, 2020).
Another characteristic is that sharing economies enable social commerce to thrive, as it is drivenby
the numerous interactions that people have on social media and similar platforms (Thaichonet al,
2020). Social commerce means that people could buy and sell goods from one another ingroups
of people meeting online without prior background knowledge of each other. Social media
interactions give room for regulation and motivation amongst peers. Participants in suchscenarios
are also motivated by money-saving through economies of scale. Üstündağlı and Güzeloğlu
(2020) insist that the use of social media platforms has moved beyond personal enjoyment and
6has encompassed a new era of commerce.
Certain major traits define a sharing economy that is being used by peers for commerce and canbe
said to be in three phases as explained by Akhmedova, Marimon, and Mas-Machuca (2020).The
first phase of the online interaction traits for SE is the pre-purchase stage where the user tries to
access the website or application that is used by service providers for interaction. In this
phase, the consumer expects that the website is easy to access, has features that are easy to
understand, and can be operated efficiently. In the second phase, the traits move from the
efficiency of accessing and operating a site to the interaction phase where the main aspects are
related to the responsiveness of the service providers, their reliability, and accessibility. In the
example of car service, the app is expected to respond appropriately by alerting the service
provider of the user location and needs, along with the swift response of the service provider in
moving towards the user location (Akhmedova, et al., 2020). The third trait involves the ability
of the service user to remain online and have a constant and continuous reassurance of the service
through proper interactions with the service provider. The service provider has to be able to
provide communication of what is happening and how long it will take for the service to be
completedfollowing what steps. The continuous improvement of the platform is also necessary to
keep the consumer encouraged and motivated on the latest improvements that make interaction
easier. These characteristics are crucial to sustaining the relationship between service providersand
consumers, especially the part related to interaction and communication via the website orapp chat
services (Akhmedova, et al., 2020).
Customer loyalty is significant in any business because it signifies how much consumers are
willing to come back to using a certain service despite any circumstances that may arise. In
customer loyalty, the consumer attaches importance to the product or service based on the
antecedents or factors of loyalty as described in many previous studies (De Araujo Leão et al,
2019). These factors are preceded by the perception of the consumer on how they are influencedto
a certain degree by the interaction with the service provider. Antecedents of customer loyalty
include but are not limited to the perceived value to the customer in areas such as time-savings
concerning the effort, perceived quality of service, perceived price advantages compared to
another service including discounts, and many others. These traits ultimately lead to customer
satisfaction that leads to customer loyalty (Barbu & Sîrbu,2018).
1.3 Purpose and Objective
The main purpose of this research is to understand how the various antecedents of customer
7loyalty along with the traits of SE influence the loyalty of consumers who utilize the SE services,
specifically concerning the vehicle transport and car services sharing economy. The objectives of
the study will be to:
• Understand sharing economy and its unique features from other markets
• To examine how the antecedents of customer loyalty influence the consumer in a sharing
economy for car transport services
• To analyze how the traits of the sharing economy affect customer loyalty for car
transport services
1.4 Research Questions
The following are the research questions:
• How do various antecedents affect customer loyalty in a sharing economy for car
transport services?
• How do the traits of Sharing Economy influence customer loyalty for car transport
services?
1.5 Delimitation
While the study will be comprehensive, the findings from the sample were not representative
enough to be applied across the whole population, need for further studies in the future with more
funding, time, and a larger sample would be important.
1.6 Research Structure
The structure of the research is based on six chapters that each represent a significant part building
up to the outcomes. The first chapter is the introduction, which explains the objectives of the
research and the research problem. The second chapter is the literature review that explores all
previous literature on the topic. the third chapter is the methodology, which examines what types
of methods were used and why. The result and analysis chapter is the fourth, and as the name
suggests, it focuses on the findings of the study based on the collecteddata. The discussion chapter
is fifth and follows up on the findings in triangulating them againstprevious literature. The final
chapter is the conclusion and recommendations, which provide insight from the whole research
and discusses implications.
82 Literature Review
Researchers (Ferreri and Sanyal, 2018) argue that any attempt to simply define the phrase sharing
economy will not, in entirety, do it justice. This is an economic principle that is constantly
changing or rather evolving. It is how technology is incorporated in the facilitation of exchanged
goods access or services among several parties. This phenomenon is derived fromthe notion that
when parties act mutually, they can adequately share value from a skill or asses that is
underutilized. This form of value exchange occurs via a collaborative platform, a sharing
marketplace, or sometimes a peer-to-peer application. Internet accessibility andmobile technology
have enhanced share-based transactions in the current world. The sharing economy thus
encompasses systems like the peer-to-peer economy, collaborative economy, crowdsourcing and
crowdfunding, coworking, and cobranding (Martin, 2016).
Acquier, Daudigeos & Pinkse (2017) add that the sharing economy keeps on disrupting the
traditional business sectors, from time immemorial. The absence of inventory and overhead helps
share-based businesses run a slant. The enhanced efficiencies allow the brands to pass value
through to their supply chain partners and customers. Traditional industries are majorly affected
by it, and most traditional brands will thrash about if they fail to adapt to the ever-changing
business landscape. The ascension of Uber in the transportation industry is a good example of
illustrating the effect that the sharing economy has on the traditional sector. It offers a safe,
affordable, convenient, and safe alternative to traditional transportation options like taxicabs or
public transit. But the utilization of an efficient network and mobile application of vetted drivers,
Uber’s services are satisfying the demands of the consumers’ transportation while making
provision for an arguably better user experience compared to the traditional means.
2.1 Sharing Economy and Its Unique Aspects
A sharing economy refers to a business model referred to as the peer-to-peer model (P2P).
According to Schor (pp. 7-22), P2P is an economic model basing on activities that acquire,
provides, or share availability of goods and services promoted by online platforms, especially
community-based online channels. It involves P2P short-term transactions of sharing idle goods
and services. Additionally, sharing economy facilitates cooperation and collaboration bysharing
goods and services between businesses and people for a fee or free. Puschmann and Alt (pp. 93-
99) pointed out that a sharing economy is a term used in describing the renting of
9private assets and services are online to others. It provides a platform that enables the making of
money from the assets that are unused or underused. People make money from these assets by
renting them out to customers utilizing their capacity. Sharing economy often involves familiar
goods and services such as household chores, driving, lodging, and cooking. A good exampleof a
sharing economy is the ridesharing and car-sharing services of Uber and Lyft. These services
allow people to rent cars and use the vehicles for intended purposes for a fee (Newlands, et al.,
2018).
A sharing economy is unique when it comes to ownership. In agreement with Zervas et al. (pp.
687-705), a sharing economy allows access instead of ownership. Rather than purchasing an asset
or a service, a sharing economy allows the customer to rent it from someone else. In addition, the
business platform itself does not possess any of the assets on offer in a sharing economy. For
instance, Airbnb offers homeowners the possibility to share their home space with travelers at a
certain fee. However, Airbnb does not own a single room, or Uber does not own a single car. Uber
allows car-owner to offer rides to passengers for a fee. Sharing economyalso brings together owners
and seekers and facilitates all processes between them. Sutherlandand Jarrahi (pp. 328-341) posit
that sharing economy involves using digital matching firms available to web-based platform
music as a mobile application to facilitate peer-to-peer transactions. The services allow
collaboration between the service providers by providing flexible employment schedules and
unique income streams. It also provides alternative employment for unemployed and
underemployed workers (Newlands, et al., 2018).
The concept of sharing knowledge, goods, and services form a sharing economy. These businesses
are mostly based on online platforms to link up supply and demand and this is not necessarily
made by individuals. The traditional companies face competition from sharing economy
companies in a wide range of markets (Cusumano, 2014). The biggest hurdle for thiscompetition
is how to apply the existing regulations to sharing economy companies. While traditional
companies adhere to these regulations, sharing economy companies feel their business models are
not affected by these regulations so they are not obliged to abide. The business environment has
changed such that focus is no longer on ownership of the product butits use. Customers can share
or hire goods instead of buying them, although this is not a new concept because for a long-time
people have been borrowing books from the library instead ofbuying them. In an informal setup,
neighbors have been helping each other (Barbu Bratu, and Sîrbu,2018). The advent of the internet
gave birth to new business models including the sharingeconomy.
10Sharing can be between consumers only, for instance, a car-sharing service where the driver shares
out the car with another individual. The increased use of the internet widens possibilitiesfor online
platforms that are easily accessible and cheap. The platforms are provided by the sharing economy
companies, consequently, this will attract demand at great levels since they are accessed globally.
The goods and services that are sharing might be in a local area or a region as opposed to
internationally accessed, a single platform can serve many regions or localmarkets. The sharing
economy can be web-based most commonly peer-to-peer (P2P). In P2Pthe sharing economy a
company does not produce the goods but only acts as an intermediate between demand and supply
(Benatar et al. 2019). For instance, the platform connects tourists or travelers with private
homeowners for accommodation. This can be done freely or at a smallfee (Pappas, N., 2019).
On the contrary, business to consumer (B2C) business type of the sharing economy is less than
the traditional businesses in several aspects. The company provides the platform to channel
demand and also provide goods and services (Puschmann and Alt, 2016). This can include a web
car renting company, clothes, or other goods. This is different from the traditional modelsbecause
ownership is not important. After all, interactions depend on modern communication technologies
and tools like computers phones, Apps, and phones. This eliminates face-to-faceinteractions as it
is in the traditional companies providing similar services and goods.
Hamari, Sjöklint, and Ukkonen (2016) add that technology has been quite crucial in the
advancement of the sharing economy to where it has reached today and, this trend must only go
on as we become more digitally connected. In this type of economy, there is an exchange of money
as consumers/users are willing to pay for the sharing, and often the creation of employment of
some form. However, while the current platform-based companies in the sharing economy are a
source of opportunities for generating income, they may not tend to wealth share, especially one
that is created in the entity as a consequence of the individual’s willingness to make assets/ to
share, available benefits. Perhaps the new service providers may not be so different from the
traditional firms which share profits with shareholders and not necessarily with their employees
(Pappas, N., 2019).
It seems the sharing economy entities are quite different from the traditional brick and mortar
firms because they act like ‘instant matchmakers’, keep matching supply and demand for the
physical time and assets use. Frenken and Schor (2019) posit that there two kinds of sharing
economy service providers that are platform bases entities. The first one encompasses the
11services which enable the physical assets sharing which match the ones looking for a physical
asset ‘timeshare use’ with the suppliers of the same. The second group is a matching service perse,
linking individual firms with time to carry out given duties to those needing the servicesat that
specific time (Pappas, N., 2019).
The main sharing economy innovation business model is in the mobile apps and technology
platforms which amalgamate and aggregate supply and demand in simple ways that were
previously not possible. It has created a cheaper, faster, and more efficiently coordinated and
allocated platform for business. It is quite efficient in sectors that are less dense and would happen
to be complicated, creating opportunities for big things. The internet reduces friction in
transactions linking those offering services or assets and the ones wishing to consume them and
makes this possible on large scale with instantaneous matching (Newlands, et al., 2018). The
sharing economy success in firms like Uber and Airbnb greatly depends on the ability to
effectively share an asset, but in the delivery services or concierge, for instance, the sharing
involved in the transaction is quite unreal, other than that time an individual uses doing chores
and running errands. Value is then derived from a more efficient allocation of capacity and human
resources, and proper matching of demand and supply (Grifoni, D‘Andrea, Ferri, Guzzo, Angeli
Felicioni, Praticò & Vignoli, 2018).
Kim (2019) argues that in the hospitality and service management domains, several researchers
shed light on major determinants influencing consumer loyalty through various contexts. The
satisfaction of consumers is broadly regarded as a crucial predictor of consumer loyalty. The
sharing economy sees consumer satisfaction play a critical role in enhancing consumer loyalty
since satisfied consumers have a higher likelihood of increasing their spending as opposed to the
unsatisfied ones and can easily recommend the platform to other probable consumers (Newlands,
et al., 2018).
Most studies on the sharing economy mainly concentrated on responses that are dependent on
affection based on consumer attitude and satisfaction. However, responses which are affection-
based are unable to adequately capture those mechanisms underlying the loyalty of users toward
sharing economy. Some studies have adequately verified the outstanding role that trust in the
decision-making process of consumers in an online transaction does (Eckhardt, et al., 2019). Trust
is a key determiner of consumer loyalty toward Airbnb. Indeed, the absence of trust in service
providersis a barrier to relationship formation with platforms of sharing economy and is a crucial
source of hesitation in consumer use of such platforms. Sharing-economy registration needs
detailed individual information. For instance, in the Airbnb case, the host profiles have more
detailed personal information like demographics, staying records, social connections, location
12data, than their services (Kim & Kim, 2020).
Satama (2014) posits that some platforms for sharing the economy can exercise malevolent
collection and use of the personal information of consumers. Additionally, sharing economy
entities can illegally congregate and sell, to third parties, consumers’ data without their
permission. Consequently, trust is one quite influential determinant of consumer loyalty to
Airbnb. The study, in this vein, attempts to establish the role of trust in consumer loyalty to
Airbnb. The perceived benefits are taken to be the focal motivational factors in the case of Airbnb
in enhancing consumer trust and satisfaction (Eckhardt, et al., 2019).
Some studies in the hospitality and marketing fields have adequately proven that benefits are
multidimensional and are measured in three forms of benefits. Chaabane, Sabri & Parguel (2010)
record that conceptualized the benefits in these three dimensions: hedonic, economic, and
symbolic benefits. Economic ones are those utility or economic benefits that come from services
or products in the sharing economy. The study regarded monetary savings as focal sharing
economy platforms’ elements for monetary benefits. Hedonic ones refer to the emotional
experience of consumers derived from the platforms within the sharing economy realm, such as
pleasure and entertainment (Frenken and Schor, 2019).
2.2 Customer Loyalty in Sharing Economy
Sharing economy is an important business trend. The sharing economy is a platform where
resources that are not used can be shared by others. Production and consumption are completely
transformed by reducing waste in sharing economy. Scholars note that the sharing economy has
become a sustainable consumption (Mao and Lyu, 2017; Zervas, Proserpio, Byers, 2017).
Companies like Uber and Airbnb create and circulate platforms of the sharing economy to inspire
individuals who have idle resources to invest in such platforms. The service industry takes
customer loyalty as the ultimate goal because it brings many benefits to a company (Yang and
Peterson, 2004). One advantage of consumer loyalty includes customers spending more, reduced
marketing costs, and sustainable customer visits.
Customer loyalty is very important for a sharing economy platform to succeed because it leads to
sharing consumption and very favorable word of mouth (Clauss & Hock, 2019). Understanding
customer loyalty mechanisms can help companies like Uber and Airbnb to have an increased
frequency of the use of the platform and the consumers can be encouraged to sharetheir experiences
on social networks (Huarng & Yu, 2019).
A customer experience can induce a positive feeling, apathy, or bad experience when they
compare the experience they get and the expectations they had (Oliver, 1993). Customers whoare
13not satisfied have less intention to make a repeat purchase of the same item or service in the future
as opposed to those who are satisfied. Additionally, they will spread a very negativeword of mouth
and they can share their experiences on their social media networks. Many studies have
emphasized the importance of the satisfaction of the consumers in increasing consumer loyalty by
spreading a positive word of mouth to influence purchase intentions again (Möhlmann, 2015).
Satisfaction of the customer in Airbnb makes the experience of the customer better for them to
continue using the services and for them to make better recommendations. This is very important
to build customer loyalty (Clauss & Hock, 2019).
The loyalty of a consumer is based on trust because it helps to lower the perceived risks involved
in buying or using a certain service (Garbarino, Johnson, 1999). After all, this attractsand maintains
host customers. Airbnb builds and maintains a long-term relationship between hosts and
consumers in line with the social exchange. Additionally, lowers risks like the abuseof personal
information and discrimination on digital platforms. Trust increases the expectation of the
consumer to have a safe reliable experience. This, therefore, underlines the fact that trustis very
important in customer loyalty. On the other hand, Uber provides transportation services to
customers who seek accommodations in Airbnb (Huarng & Yu, 2019).
When consumers use Airbnb, they save money when making reservations for their
accommodations. Customers can save money by accessing a variety of services on the sharing
economy platform by effectively achieving their goals. Comparatively, consumers can access
accommodation at a very low price compared to living in a branded hotel. Earlier studies on
marketing and management of services have analyzed the importance of the positive attitude of
the consumer and taking part in the sharing economy (Jia, et al.,2020). Guttentag et al (2018)
show that saving money is a very important factor in the consumer choice of accommodation.
(Sung et al. 2018) says that better financial performance will develop positive consumer
satisfaction when consumers put up in Airbnb at a cheap price. For this reason, money saved as a
result ofusing Airbnb accommodations will enhance consumer satisfaction and trust in Airbnb
(Jia, et al.,2020).
Sharing economy influences customer loyalty through flexibility. According to Matzler et al. (pp.
71), sharing economy provides flexible services that make everyday life for consumers readily
available and affordable. The sharing economy has extensive and well-distributed supply sides
that enable it to keep the prices fair and eliminate the need for individuals to owntheir properties.
Ridesharing and car-sharing services in the transportation sector provide environmental
sustainability solutions, hence influencing customer loyalty. (Hu et al. pp. 177-187). For example,
BlaBlarCar provides carpooling services that connect passengers and drivers willing to share gas
14expenses. The benefits of carpooling reduce the ozone layer's environmental effect, hence
promoting customer loyalty through sustainability efforts (Clauss & Hock, 2019).
Additionally, sharing economy develops a culture of trust that leads to customer loyalty. In
agreement with Hawlitschek et al. (. 24-34), sharing economy is based on trust among and
between the participants/ It is a mechanism like commenting rating and offers support in case of
abuse, leading to customer loyalty. Constant engagement with customers also leads to
transparency and customer loyalty in a sharing economy. Akhemedova et al. (pp. 121736) posit
that sharing economy allows effective and constant user engagement through promotion leading
to customer attraction and customer loyalty.
2.3 Improving Trust and Loyalty in Sharing Economies
In sharing economy customers relate with the providers of services directly, therefore, creatinga
social connection that goes beyond economic exchanges. These service experiences help to build
mutual understanding to motivate customers to maintain a relationship and stay committed to the
provider of the service (Yang et al. 2017). One important thing in the sharingeconomy is that the
customers, suppliers may start a relationship that may go beyond businesspurposes. Studies show
that there is a positive relationship between social interactions and customer commitment
(Godwin, 1996). A social bond between the customer and the providerof the service enhances the
dependence of the consumer on the provider and will eventually make the customer committed to
the company (Berry, 1995).
When the service a company offers meets the expectation of the consumer, this will make the
consumer trust the company. A consumer who has had a positive experience with services and
goods offered by a company in the sharing economy will have a positive word of mouth (Maoand
Lyu, 2017). They can share a positive word of mouth on the social networks where they interact.
The risks involved will be reduced by positive word of mouth. These consumers willbe loyal to
the service provider (Huarng & Yu, 2019).
A sharing economy would collapse without trust. In line with Habibi et al. (pp. 113-121), for any
business in the sharing economy, building trust between service providers and customer isessential
in a business's success. Any mistrust between them could lead to the loss of a potentialcustomer.
Trust in a business leads to customer loyalty. Without trust, there is no customer loyalty. Recent
studies show that creating trust in a sharing economy is challenging since mostbusinesses have
less inventory, and they only use supply chain partners and vendors when delivering the
proposition value. For instance, P2P lending platforms allow people to borrow financial assistance
without using the traditional bank's mechanism. They base the interest ratesbased on the credit
history of the borrower. They do provide unsecured personal loans to borrowers based on the trust
15that the customer would pay back. According to Gerwe and Silva(pp. 65-96), this creates risk for
lenders who give via P2P platforms as some customers may default on the loans. It is also risky
for lenders to give out loans without effectively researchingstocks, making them settle for little
interest payments from a savings account.
House sharing platforms such as Airbnb connect customers, especially homeowners. Conforming
to Yang et al. (pp. 15-28), the house-sharing platforms connect private individuals with
homeowners needing a place to stay when traveling. The visitors can browse accommodation and
chose a place that fits their preferences and budget. The house-sharing platform addresses the
potential security issues of sharing the customer's living space with strangers. This builds trust
and leads to customer loyalty. For instance, Airbnb has a verified ID program that requires the
visitors and the homeowners to provide detailed data concerning their background before using
their services. (Ter Humme et al. (pp. 485-498). On the other hand, car sharing and ridesharing
platforms such as Uber and Lyft have constant online engagement. They do offer promotion codes
to users, assisting them in creating customer loyalty.
Key (2017) posits that trust within the online environment is a focal point in the success of the
sharing economy. Although it has no universal definition, it majorly relies on future actions
between individuals. Prior research has painted trust as a critical issue in the establishment of
relationships, of both commercial and interpersonal nature. Furthermore, in business
environments with much risk and uncertainty, trust is quite decisive in justifying, overcoming,or
even suppressing appendant results. It particularly stands for distant relationships, like in
computer-mediated environments, because of increased uncertainty and complexity.
163 Methodology
3.1 Research Design
The research design will be based on quantitative research that is focused on understanding the
relationship between variables through existing theories and hypotheses developed. Quantitative
research means that numerical data will be used that will be analyzed through statistical methods.
Therefore, the various methods involved in data analysis and collection areexplained below.
3.2 Research Paradigm
A paradigm in research refers to a perspective that is philosophical and used to interpret the results
of the study. The current research philosophy that the researcher considered to best fit the data is
the positivist paradigm. This paradigm embraces the use of an objective focus to gather and
analyze data without the personal or biased opinions of the researcher (Park and Leem, 2019).
Through positivism, the researcher can apply ontological and epistemological thinking that solely
relies on what the data informs to present outcomes.
The ontology in a paradigm refers to the nature of the study and how that phenomenon is
interpreted (Kim, 2020). An ontology can be subjective or objective. In this case, the best ontology
that coincides with the positivist paradigm is the objective focus. The objective focusallows the
findings to be interpreted based on what they represent alone and not what the researcher gathers
from their knowledge. In a sharing economy where the antecedents in different ways can influence
loyalty, the researcher needs to examine the information from anabsolute point of view of the data
and not what the researcher thinks, feels, or knows (Schoonenboom & Johnson, 2017).
Epistemology refers to the source of knowledge in terms of how knowledge is generated (Huckle
et al, 2016). By knowing the source of knowledge, it becomes easier to understand how to analyze
and interpret the data. In the positivist paradigm, epistemology is empirical in nature and context-
independent. This implies that the source of data has no objective in mind but rather provides
information as a source of knowledge that is independent and can be utilizeddirectly.
173.3 Research Approach
A quantitative study relies on a deductive research approach in understanding how the whole
research process will be carried out. A deductive approach starts with a more generalized
understanding of an issue and moves towards a specific conclusion (Dirgová, Janičková, and
Klencová, 2018). This takes the form of a theory that is observed across other phenomena and
creates an interesting gap that has to be examined. This theory leads to the creation of a tentative
answer known as a hypothesis that tries to explain the relationship in the observed phenomena.The
researcher then embarks on a process to gather data that will either support or refute the claims
made through various methods that are quantitative or empirical. After that, theresearcher makes
observations on the findings and then confirms or rejects the earlier hypotheses made. The
quantitative research approach is selected because it allows researchers to navigate phenomenon
without compromising the result through own cognitive bias (Schoonenboom & Johnson, 2017).
Also, quantitative research can allow the researcher to conduct a study with relatively higher
scalability which is vital for geographically generalized study.
3.4 Research Process
The research process applied in this study was based on the deductive approach as explained. In
the process, the researcher started with identifying the population and sample to be includedin the
research (Schoonenboom & Johnson, 2017). After identifying them, the researcher went ahead
and focused on contacting the participants who agreed to engage in the study. many of the
participants contacted agreed but some did not. The study ensured that the participants all gave
their consent to participate before being included. Finally, the researcher gathered the data,
analyzed it, and presented thestudies. A deductive approach is adapted for the research process
because, in this study, the researcher is attempted to understand whether the specific phenomenon
is consistent with the literature regarding the aspect of sharing economy in general. As the
deductive process follows the phenomenon from the broad viewpoint to conclude specific insights
of narrow viewpoint, this particular research approach is justified in this case (Schoonenboom &
Johnson, 2017).
3.5 Participants Selection
This research focused on consumers who have been involved in using the SE transport services
such as Uber, Lyft, and others across different countries. The researcher did not limit the regionof
participation to access as many participants as possible. The participants targeted had to know
English as well and as mentioned, have utilized the SE transport services at least once. The
researcher targeted online participants who were easier to reach and communicate with compared
18to face-to-face participants. To make it easier to reach more people, the researcher used third
parties to contact and communicate with respondents. This included social media sites as well as
third-party contractors who have access to individuals including contacts to enable facilitating
data collection. The option to involve third parties was motivated by the need to gather as much
data as possible from a wide variety of people as well as the COVID-19 pandemic that has limited
the interaction of people to online communication tools. Having known few people online, the
researcher thus sought help from other sources to expand the study. The researcher contacted
350 participants initially from different sources. However, notall responded as only 284 confirmed
and returned their responses.
3.6 Sampling Method
The sampling method used was purposive sampling, which as the name suggests; targets
individuals based on certain characteristics expected to be present before they can be allowed to
participate. This means that people without these aspects were eliminated from the study. while
purposive sampling eliminates the random sampling advantages such as the ability to generalize
findings, it allows the research to be specific in that participants have knowledge and
understanding of what they will be involved with (Tianbo and Xiaojuan, 2015). In choosing
participants who can know what SE services in transport are, they can supplement relevant
information about their experiences.
3.7 Data Collection Tools
The data collection tool employed was a questionnaire, which was used for its many advantagesas
a quantitative data collection tool. one advantage is that it is easy to create and administer, making
it highly reliable. Questionnaires are flexible and to the point in that participants will be able to
give the answers more instantly. More importantly, there is no limitation to the number of
participants that could be involved in a questionnaire response. The larger the sample, the better
the outcome predictability and generalizability (Schoonenboom & Johnson, 2017). A
questionnaire is an objective way of gathering data, as the opinions of the researcher are not
involved. Instead, the researcher only relies on statistical methods to analyze the data thus
eliminating bias (David, Chalon, and Yin, 2016).
3.8 Data Analysis
Data analysis was done using statistical tools that support quantitative analysis in hypothesis
testing. The most common and easy-to-use tool is the SPSS statistical package. The tool will be
used to analyze variables through regression. Descriptive statistics will be used to describe the
19participant characteristics.
3.9 Research Ethics
Research ethics applies to all studies that deal with human participants because it helps to provide
them with reassurance and security. The researcher applied all ethical principles including getting
consent from the participants, even if through third parties. There was also no harm done to the
participants through the questions asked as they were not personal. The researcher ensured
privacy and anonymity by not getting the personal details of participants. The researcher revealed
the purpose of gathering data and only ensured that the information included in the study related
to the responses only (Roth & von Unger, 2018).
3.10 Theoretical Framework
The selected theories in the study will include customer satisfaction, customer loyalty, and sharing
economy. Customer satisfaction has been included as an antecedent and mediator of customer
loyalty because it has been shown to predict whether consumers will be loyal to a business.
Customer satisfaction implies that consumers perceive their position to be advantageous when
they purchase goods from a given service provider in terms of having value and thus feel
comfortable (Thaichon et al, 2020). Customer loyalty means that a customer willreturn on another
occasion to purchase goods from a supplier no matter what the situation is; as they deem the
services being provided to be highly satisfactory (Huckle et al, 2016). A sharing economy as
explain is a concept that extends beyond one service provider and user by making available a
personal asset to many others to benefit more people, have temporary ownership, and pay lower
fees for such short usage of items that one does not need long term (Thaichon et al, 2020).
3.11 Research Variables
There are two variables in this study that are independent and dependent. The independent
variables are those that are being tested in the study in terms of how they affect others and are
reliant on other variables to find the outcome. The independent variables in this study were
perceived value, service quality perception, price perception, SE traits, and customer satisfaction.
Dependent variables are the outcome variables being tested and, in this case, it is customer loyalty.
3.12 Hypotheses
H1a= In a sharing economy for car transport services, perceived value positively affects customer
satisfaction towards service providers
H1b= In a sharing economy for car transport services, perceived service quality positively affects
20customer satisfaction towards service providers
H1c= In a sharing economy for car transport services, price perception positively affects customer
satisfaction towards service providers
H2= In a sharing economy for car transport services, SE traits positively affects customer
satisfaction towards serviceproviders
H3= In a sharing economy for car transport services, customer satisfaction positively affects
customer loyalty towards service providers
3.13 Conceptual Framework
The conceptual framework represents how the various hypotheses were analyzed in the study.
Figure 1 Conceptual Framework
214 Results and Analysis
4.1 Descriptive Statistics
The age group of the participants was distributed well across all age groups. Those aged between
25 and 34 years were the highest in number followed by millennials. This is as represented in the
graph of age groups below.
Figure 2 Frequency Distribution of Age Group of Participants
Gender from the graph below showed that male participants were significantly more than female
participants.
Figure 3 Frequency Distribution of Gender of Participants
22Bachelor's degree followed by college diploma graduates were the most respondents innumber.
This shows that while usage of car transport services of sharing economy is distributed across all
education levels, more people with at least a college diploma are involved. However, fewer
individuals with PhDs were shown to utilize
Figure 4 Frequency Distribution of Education Level of Participants
Most of the respondents were from America, followed by Asia and then Europe and the others.
Americas combines both North and South in general.
Figure 5 Frequency Distribution of Geographic Region of Participants
23Many customers by far indicated that they were satisfied with the car transport services of
sharing economy, they got from engaging their websites/apps in transport access.
Figure 6 Frequency Distribution of Level of Satisfaction of Participants
Besides satisfaction, when asked whether they would remain loyal in using the car transport
services of sharing economy, the respondents with an affirmative answer were significantly
numerous as well.
Figure 7 Frequency Distribution of level of optimism of Participants
244.2 Regression Analysis
H1a= In car transport services of sharing economy, perceived value positively affects customer
satisfaction towards service providers
In the first hypothesis, the researcher analyzed whether the perceived value in the car transport
services of sharing economy positively influences customer satisfaction. From the sig. value, the
hypothesis was accepted and suggests that there is a positive correlation between perceived value
and satisfaction. This means that if service providers in a sharing economy want to increase
consumer satisfaction, they should be able to add value to their services and products
continuously.
Model Sum of Df Mean F Sig.
Squares Sqaure
Regression 17.190 4 4.297 76.245 .000
Residual 15.726 279 .056
Total 32.915 283
a. Dependent Variable: Do you think you are highly satisfied by SE transport services as a customer is given how they currently are?
b. Predictors: (Constant), I find car transport services of SE reliable whenever I need them, The value I gain is higher using SE services for
transportation, I find it easy to use this type of service than looking for other means of transport, SE in transport saves my time and energy of
looking for other transport
Table 1 ANNOVA
Looking at the individual coefficients of perceived value and how they interact with satisfaction,
it is evident that there is a strong correlation in the coefficient of value gained followed by the
ease of using the SE services in transport. The weakest correlation was found in saving time and
energy. This means that the sharing economy for transport has to improve the value of time in
responding to consumer request.
Model Unstandardized Standardized T Sig.
Coefficient Coefficient
B Standard Beta
Error
(Constant) .117 .074 1.575 .116
SE in transport saves my time and energy of
looking for othertransport -.231 .079 -.490 -2.920 .004
The value I gain is higher usingSE services for .434 .081 .829 5.364 .000
transportation
I find it easy to use this type of service than
looking for other means of transport .157 .048 .441 3.239 .001
I find SE services reliablewhenever I need them -.024 .050 -.060 -.475 .635
H1b= In the car transport services of sharing economy, perceived service quality
positively affects customer satisfaction towards service providers
Table 2 Coefficient of H1b Hypothesis
The perceived service quality was also found to be positively correlated to customer satisfaction
as the hypothesis was accepted as shown below. This implies that consumers findservice quality
25an important factor when using transport in a sharing economy.
Model Sum of Df Mean F Sig.
Squares Sqaure
Regression 9.243 3 3.081 36.440 .000b
Residual 23.673 280 .085
Total 32.915 283
a. Dependent Variable: Do you think you are highly satisfied by SE transport services as acustomer is given how they currently are?
b. Predictors: (Constant), The staff are polite, respectful, and helpful, The interior of the cars isclean and fresh, The services
offered are efficient and reliable as drivers respond in time
Table 3 ANOVA
The strength of the correlation is low in most of the coefficients, and thus service quality
represents a weak positive relationship. This is as shown by the last three coefficients below that
have a high sig. value.
Model Unstandardized Standardized T Sig.
Coefficient Coefficient
B Standard Beta
Error
(Constant) .309 .090 3.435 .001
The services offered are efficient and reliable as .169 .088 .425 1.909 .057
drivers respond in time
The interior of the cars is clean -.005 .054 -.016 -.099 .921
and fresh
The staff are polite, respectful, and helpful .050 .078 .123 .642 .521
(Constant) .050 .078 .123 .642 .521
H1c= In the car transport services of sharing economy, price perception
positively affects customer satisfaction towards service providers
Table 4 Coefficient of H1c
This hypothesis too was accepted and represents an equally important part of how service
providers giving sharing services can satisfy consumer needs.
Model Sum of Df Mean F Sig.
Squares Sqaure
Regression 16.556 3 5.519 94.459 .000b
Residual 16.359 280 .058
Total 32.915 283
a. Dependent Variable: Do you think you are highly satisfied by SE transport services as a customer is given how they currently are?
b. Predictors: (Constant), During peak and rush hours, the SE transport prices are still lower, I have gotten a discount at least once when using
SE transport, The prices of SE transport are much lower compared to others like hailing cabs
Table 5 ANOVA
Two of the coefficients provide a strong positive relationship while two offer a weak positive
correlation. This indicates that the overall correlation was not as strong.
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