Electron Markets (2014) 24:269–284
DOI 10.1007/s12525-014-0170-x
SPECIAL THEME
Does service convenience matter? An empirical assessment
of service quality, service convenience and exchange relationship
in electronic mediated environment
Hua Dai & Al F. Salam
Received: 30 June 2013 / Accepted: 1 October 2014 / Published online: 30 October 2014
# Institute of Information Management, University of St. Gallen 2014
Abstract This study examines, from the consumer centric
perspective, how service convenience in conjunction with
online service quality affect long-term relational exchange in
the electronic mediated environment (EME). Service conve-
nience is conceptualized as a second order formative construct
with six convenience dimensions demonstrating the process
of online service consumption. An analytical framework is
developed and tested to validate a comprehensive research
model of service convenience and its antecedents and conse-
quents. Analysis of data from 772 respondents revealed that
service convenience is indeed a multidimensional formative
concept and contributes to long-term exchange relationship
between the consumers and service providers. Implication and
future research is discussed.
Keywords Service convenience . Relational exchange .
Electronic mediated environment . Second-order formative
construct . PLS
JEL classification M15
Responsible Editors: Jan Marco Leimeister and Hubert Österle
H. Dai (*)
University of Wisconsin-La Crosse,
1725 State Street, La Crosse, WI 54601, USA
e-mail: hdai@uwlax.edu
A. F. Salam
Information Systems and Operations Management
Department, Bryan School of Business and Economics UNC,
Greensboro (UNCG), Greensboro, North Carolina 27402, USA
e-mail: amsalam@uncg.edu
Introduction
What is service convenience and what role does service conve-
nience play in conjunction with service content quality and
service delivery quality in developing exchange relationship
among consumers and online service providers in the EME?
A customer’s willingness to maintain a relationship with a firm
is contingent on his or her perception of the benefits of high-
quality service that provides a continuous flow of value. A
number of empirical studies have investigated the impact of
service quality on outcome variables such as customer commit-
ment, attitudinal loyalty, and purchase intentions. Although
these studies provide insight into how these antecedents affect
exchange relationship they do not consider the role of service
convenience as part of the theoretical framework. In practice
though, service convenience is a major factor for both
ecommerce companies such as amazon.com, target.com and
for online banks such as citi.com etc. and their customers.
Interestingly, within the context of service-dominant logic
(Vargo and Lusch 2004), service convenience has been identi-
fied in the marketing and IS literature as one of the most
important patronage determinants (Keh and Pang 2010;
Seiders et al. 2007; Collier and Kimes 2013, Farquhar and
Rowley 2009; Dai et al. 2008, 2011). Service convenience is
also a direct and intuitive measure for consumers to evaluate
service providers’ performance. Additionally, recent IS research
on services (Setia et al. 2013; Kohler et al. 2011) emphasized
the customer-centric role as most important business strategy to
serve and create value for customers effectively. In this context,
customers become co-creators of value in relation to the ser-
vices and they themselves become operant resources (Vargo
and Lusch 2004, 2006). “Thus, the value of any exchange or
relationship is perceived and determined by customers on the
basis of value-in-use” (Bardhan et al. 2010, pp. 37).
Service convenience is one of the most critical consider-
ations for most consumers when making purchase decisions
270
(Seiders et al. 2007; Berry et al. 2002) implying that of “a
further shift away from convenience being a product attribute
to its being a consumer activity that is enacted during the
consumption process or ‘value in use’”(Farquhar and Rowley
2009). Following this line of reasoning, service convenience is
conceptualized as integral to the “value-in-use” metaphor,
which succinctly captures our notion that consumers are value
co-creators (Vargo and Lusch 2004; Bardhan et al. 2010) in the
context of EME. For example, if a consumer, using an online
banking service finds the service to be difficult to access or
difficult to search and use, over multiple episodes is likely to
find the service to be not convenient and thus may find the
service “value-in-use” to be less than desirable as the customer
is unable to enact and co-create ‘activities’ that are integral to
the service consumption and value creation process.
Following Farquhar and Rowley (2009) and Berry et al.,
(2002), we define convenience of a service to be the perceived
sense of control by consumers over the management, utiliza-
tion and conversion of their time and effort in achieving their
goals associated with access to and use of the service.
Although, service convenience has received increased recog-
nition in the marketing literature (Berry et al. 2002; Kolter and
Zaltman 1971; Etgar 1978; Nickols and Fox 1983; Seiders
et al. 2000, 2007), unfortunately, it has received only limited
attention in the information systems (IS) research (Dai et al.
2011). Most E-Service research has not considered the role of
service convenience explicitly as part of the E-Service con-
ceptualization. Consumers opt for E-Services where available
rather than traditional brick-and-mortar services primarily be-
cause of increased service convenience.
Several IS studies investigated some of the antecedents of
online service quality such as navigation, visual appeal, timeli-
ness, access, content customization and reliability (Palmer 2002;
Jiang and Benbasat 2007) and others investigated loyalty, value
and Word-of-Mouth communication (Kim and Son 2009;
Chang and Chen 2010; Parboteeah et al. 2009; Turel et al.
2010; Luong 2005). Interestingly, studies that have investigated
antecedents of service quality (Palmer 2002; Jiang and Benbasat
2007) do not develop a comprehensive model integrating these
antecedents with service quality and subsequent impact on
customer outcome variables such as commitment, value and
loyalty. Conversely, studies that have investigated online service
and online service quality (i.e., Parboteeah et al. 2009; Turel
et al. 2010; Kim and Son 2009; Chang and Chen 2010; Cyr et al.
2006) do not consider antecedents of service quality and their
impact on relational outcome variables. Commitment, value and
loyalty are critical constructs that directly impact customer
retention and growth for online services firms (Reicheld
2003). Consequently, there is an increasing need for further
conceptual development as well as empirical assessment about
the antecedents of EME service quality and the effect of service
quality on customer relationship outcomes (Carrillat et al. 2009)
such as commitment, Word-of-Mouth communication, loyalty
H. Dai, A.F. Salam
and value. Moreover most of these studies have not considered
the role of service convenience in conjunction with service
delivery quality and service content quality and their potential
effect on customer exchange relationship in terms of value,
commitment, loyalty and word-of-mouth communication. It is
unclear how antecedents of online service quality, service con-
tent and delivery quality along with service convenience affect
exchange relationship among consumers and online service
providers. In this paper we address this gap in IS research.
In the rest of the paper, we present a review of the current
research, our proposed research model, data analysis and
measurement model and structural model assessment, discus-
sion and conclusion.
Literature review
While initial IS research have been important in developing
insights into service convenience in the IS literature, the lack
of clarity, conceptual confounding has hampered important
development in this area. Information Systems research has
sometimes mixed service convenience construct with other
concepts such as service speed (Compaine and Weinraub
1997; Aladwani 2001), customer comfort (Chen and Hitt
2002; Bhattacherjee 2001), customer effort (Shim et al.
2002; Parasuraman 2000), and service accessibility (Rust
and Kannan 2003; Wixom, and Todd 2005). Extant literature
in marketing has established service convenience to be clearly
distinct from the concept of easiness (Berry et al. 2002;
Seiders et al. 2007; Farquhar and Rowley 2009). Lee et al.
(2012) reviewed recent IS literature (Dennis and Taylor 2006;
Galletta et al., 2006; Rose et al. 2005) and investigated cus-
tomer waiting time and its influences on consumer behavior.
Luo et al. (2012) stated the problem with online environment
is the temporal and spatial separation of buyers and sellers, so
consumers face a high degree of uncertainty (Ba and
Johansson 2008; Pavlou et al. 2007). Traditional knowledge
on services management (Bardhan et al. 2010; Lovelock and
Gummesson 2004) may not be readily adaptable to electronic
mediated services strategies. In the following section, we
attempt to provide a more theoretically driven conceptual
presentation of service convenience and its various dimen-
sions in the electronically mediated environment.
Conceptualization of service convenience in EME
Recently, convenience is acknowledged as a multidimensional
construct in the marketing and consumer research literature
(Brown 1990; Seiders et al. 2000, 2007; Berry et al. 2002).
Brown (1990) identified five dimensions of a convenience
construct by applying economic utility theory and indicated
that consumers desire convenience in terms of time, place,
acquisition, use, and execution. Based upon prior theories and
Service quality, service convenience and exchange relationship
research on time and efforts expenditure and consumer
psychological cost, Berry et al. (2002) proposed five
dimension of service convenience: decision convenience,
access convenience, transaction convenience, benefit con-
venience, and post-benefit convenience. Later, Seiders
et al. (2007) developed the SERVCON scale and empiri-
cally validated the service convenience construct in the
context of traditional service consumption. From these
studies, we observe that service convenience has been
defined as a construct that refers to the consumers’
expenditure of minimal time and effort in service
consumption.
Based on the extant IS and Marketing literature, our study
identifies six formative dimensions of second order service
convenience in EME construct (Seiders et al. 2000; Berry
et al. 2002; Seiders et al. 2007; Dai et al. 2008, 2011) (see
Fig. 1). These are (1) service decision convenience in EME,
(2) service access convenience in EME, (3) service search
convenience in EME, (4) service transaction convenience in
EME, (5) service benefit convenience in EME, and (6) service
post-benefit convenience in EME.
Service search convenience EME refers to the speed and ease
with which consumers could identify and select the products
or services in EME (Seiders et al. 2000). For example, online
classification systems (e.g., craigslist, angie’s list) shortens the
consumer search depth which may involve certain time and
effort expenditure.
Service decision convenience in EME relates to the time and
effort expenditure required to decide how to obtain or pur-
chase an electronic mediated service (Berry et al. 2002;
Seiders et al. 2007). For example, online reputation systems
provide reviews of online products or sellers that would
reduce consumers’ time and effort to compare different op-
tions before the purchase decision is made.
Service access convenience in EME relates to consumers’
perceived time and effort expenditures to initiate service deliv-
ery (Berry et al. 2002; Seiders et al. 2007). This type of conve-
nience could be seen in online banking systems where con-
sumers would highly depend on the information availability and
accessibility since there is minimal assistance from employees.
Service transaction convenience in EME primarily involves
expenditures of time and effort as it relates to the execution or
fulfillment of a transaction (Seiders et al. 2000; Berry et al.
2002). For instance, online one-stop online payment functions
reduced consumers’ time and effort in filling in numbers on
online forms repetitively.
Service benefit convenience in EME relates to consumers’
time and effort expenditures to experience the online services’
271
core benefits (Berry et al. 2002; Seiders et al. 2007). Typically,
it means the favorable return on consumer’s investment (e.g.,
time, effort, and other resources).
Service post-benefit convenience in EME involves the con-
sumers’ perceived time and effort expenditures as a post-
purchase experience when reinitiating contact with a firm
after the benefit stage of the services (Berry et al. 2002;
Seiders et al. 2007). Generally, this convenience is diffi-
cult to achieve in EME since it is generally not easy to
contact a ‘live person’ in the context of online service
providers on a real time basis. Some service providers
have begun to provide 24*7 customer support with instant
messenger in order to improve consumers’ post-purchase
experiences.
We propose an emergent second order factor model for
service convenience in EME (Fig. 1) where the first-order
factors such as Search Convenience in EME, Decision
Convenience in EME, Access Convenience in EME,
Transaction Convenience in EME, Benefit Convenience in
EME and Service Post-Benefit Convenience in EME are all
latent formative factors. We conceptualize that this second
order service convenience construct (Pavlou et al. 2008;
Petter et al. 2007) plays a mediating role between service
quality and exchange relationship development between the
consumers and service providers. For example, Encyclopedia
Britannica always had very high quality service content (in
terms of high quality and well-researched articles) but at one
time were not conveniently accessible and so lost a part of
their market share to other competing brands that were online.
It is our contention that service convenience mediates the
relationship between service quality and consumer exchange
relationship. In the next section, we develop and present our
research model.
Proposed research model
In this section, we present our research model (see Fig. 2)
that depicts antecedants of online service delivery quality
and service content quality and mediating role of service
convenience and their collective effect on consumer ex-
change relationship variables such as value, commitment,
loyalty and word-of-mouth communication (Tan et al. 2013;
Zeithaml et al. 2000; Parasuraman et al. 2005; Lociacono
et al. 2000; Fassnacht and Koese 2006; Collier and
Bienstock 2006).
Determinants of service delivery quality
Service delivery quality is defined as the manner in which
EME functionalities are made accessible to consumers via the
service provider’s website as a delivery channel (Tan et al.
272 H. Dai, A.F. Salam

Service Convenience in
EME

Service Service Post-

Service Search Service Decision Service Access Service Benefit
Transaction Benefit
Convenience in Convenience in Convenience in Convenience in
Convenience in Convenience in
EME EME EME EME
EME EME

Fig. 1 Service Convenience dimensions

2007, 2013). Based on the literature (Turel et al. 2010; Cyr
et al. 2006), we highlight the following three antecedents of
service delivery quality: accessibility, reliability, and
timeliness.
provide 24*7 customer support with instant messaging to
improve accessibility. We propose the following hypothesis:
Hypothesis 1 Accessibility of the online service is positively
associated with service delivery quality in EME.

Accessibility
Accessibility is related to the actions taken by the service
provider to ensure no service interruption. More and more
customers now look for company access and support via EME
(De Ruyter et al. 2001). Potential service failures impact
future business because they weaken the customer-company
bonds and perceptions of service quality (Bolton and Drew
1991). In this research, accessibility is defined as the level of
effort taken to minimize service disruptions. Since it is gener-
ally not always easy to contact a ‘live person’ in a traditional
service environment, EME service providers have begun to
Reliability
In offline contexts, reliability is defined as the “ability to perform
the promised service dependably and accurately” Parasuraman
et al. 1985). Similarly, EME reliability is concerned with the
delivery of the service in good condition, on time, and exactly as
it was displayed. A study of online failures stated that consumers
noted delivery issues as the most frequently stated problem
(Holloway and Beatty 2003). Such failures can result in signif-
icant costs to the firm, such as lost customers and negative word-
of-mouth communication (Bitner et al. 2000). Consequently,

Accessbility
H
1
Service
Reliability H2 Delivery Value H11
3
Quality Loyalty
H
H7

H9

Timeliness
H1

Formative
3

Service
2
H1

Convenience
Visual
H1

Word-of-mouth
0
H8

Appearance Communication
4
H H1
4
Service Commitment
Flexibility H5 Content
6
Quality
H

Navigation

Fig. 2 Proposed research model of service convenience in EME and its antecedents and consequents related to the development of long term exchange
relationship
Service quality, service convenience and exchange relationship
service failure is a driving factor explaining customer switching
behaviour (McCollough et al. 2000). Thus, based on these
arguments we state the following hypothesis:
Hypothesis 2 Reliability of the online service is positively
associated with service delivery quality in EME.
Timeliness
Szymanski and Hise (2000) were one of the first to em-
pirically test a conceptual model finding that convenience
and timeliness of website performance were primary de-
terminants in consumer online experiences. Access speed
and performance appear as critical to the assessment of
quality in EME. As a result we have the following
hypothesis:
Hypothesis 3 Timeliness of online service response is posi-
tively associated with service delivery quality
in EME.
Determinants of service content quality
Service content quality is defined as the extent to which
complete, accurate, and timely content is provided to online
consumers during the interaction process with the user inter-
face in the EME (Tan et al. 2007, 2013). The user interface is a
critical component in the EME service experience. In the
context of the online environment, the store layout and design
particularly influences the consumer’s service consumption
experience (Seiders et al. 2000). To capture service content
quality we have identified the following three antecedents
based on the literature: visual appearance, navigation, and
flexibility. These antecedents have been found to be important
in the context of online services in past IS studies (Ozment and
Morash 1994).
Visual appearance
A consumer’s perception of the visual appeal projected by
the service is driven by the design, physical attractiveness,
and beauty inherent to the service interface (Hirschman
and Holbrook 1982). Visual appearance in EME can be
defined as an overall output of image or personality gen-
erated from website components such as text, style,
graphics, colors, logos, themes and slogans (Srinivasan
et al. 2002). Websites with a more visually acceptable
interface often result in greater service quality and can
influence a consumer’s EME experience and thus, ulti-
mately, his or her long-term service exchange relationship
(Cyr et al. 2006; Dai and Salam 2010). Consequently, the
273
interface appearance is one of the most important aspects
of the EME experience. The above arguments lead to the
following hypothesis:
Hypothesis 4 The visual appearance of the online service is
positively associated with service content
quality in EME.
Navigation
Ease of navigation has surfaced as a critical element, since the
EME lacks most of the interactional human elements so vital
in offline service delivery (Holloway and Beatty 2003).
Navigation challenges, such as getting lost is often associated
with a consumer’s confusion, frustration, and anger, and thus
negative experiences. A considerable amount of freely avail-
able information, if it is well organized and easily accessed, is
frequently mentioned by consumers as an important reason to
interact with an EME anger (Rosenfeld and Morville 2002).
The ease of navigation in the EME is expected to enhance
service content quality. As a result, we expect:
Hypothesis 5 The navigation of the online service is positively
associated with service content quality in EME.
Flexibility
Flexibility has been considered as one of the important criteria
of perceived good service quality in traditional service mode
(Grönroos 1990). In service context, it refers to “the degree of
flexibility in responding to the customer’s needs which was
beyond the routine service provided by the organization”
(Johnston 1995, pg.61). EME provides consumers with more
options to choose the mode of service—traditional employee
service or self-service (Berry et al. 2002). Within the context
of EME, services are delivered via the web through a software
interface where customers engage in self-service and interact
with web content offered by service provider. Recent studies
on e-service quality all consider service content flexibility as
one of important dimensions of service quality (Zeithaml et al.
2000; Parasuraman et al. 2005; Wixom and Todd 2005;
Buckley 2003). Based on these arguments we expect:
Hypothesis 6 The flexibility of online service is positively
associated with service content quality in EME.
Service delivery quality and service convenience
Services are delivered via the web through a software interface
where customers can engage in self-service. One example of
an EME service is the FedEx online package tracking system.
274
By utilizing an online tracking system, FedEx can respond to
customers’ needs very rapidly, without any human interven-
tion on Fed Ex’s part. FedEx saves money on having to update
and notify customers when packages will arrive, while cus-
tomers are much more satisfied. Therefore, this choice should
improve consumers’ convenience perceptions of using or
buying services. Service delivery quality is defined as the
manner in which IT mediated service functionalities are made
accessible to the consumers via the service providers’ website
as a delivery channel (Tan et al. 2013).
Hypothesis 7 Service delivery quality is positively associat-
ed with service convenience in the EME
Service content quality and service convenience
Online store layout and design influences the consumer’s online
activity and service consumption (Seiders et al. 2000).
Mathwick et al. (2001) suggest that in online environments,
the use of color, graphic layout and photographic quality com-
bine to influence a desirable consumption experience. The con-
tent as well as the store layout and design influence consumer’s
efficient online “movement” (Baker et al. 1994) and affect their
time and effort expenditures in finding their desired merchandise
or service (Seiders et al. 2000). A high level of service content
quality should reduce consumers’ time and energy costs in the
entire process of service consumption in the EME.
Hypothesis 8 Service content quality is positively associated
with service convenience in the EME
Service convenience and value, commitment, WOMC
and loyalty
Dwyer et al. (1987) pointed out that the “‘buyer-seller’ rela-
tionship involves analogous benefits and costs” (pg.14) and
proposed a five-phase model of the long-term exchange rela-
tionship. Today services are delivered in recognition that con-
sumers’ experience is formed across all moments of contact
with the firm (Sousa and Voss 2006). Such exchange relation-
ships are guided by high order mental constructs such as
customer perceived value and commitment (Garbarino and
Johnson 1999).
Perceived value
According to Holbrook (2006) “Such interactive relativistic
preferences shape the essence of the consumption value in the
sense that products perform services that provide the relevant
value-creating experiences… From this perspective, all
H. Dai, A.F. Salam
products are services…” (pg. 715). Consumer perceived value
is often involved in consumers’ evaluations of the service
which assess the ratio of perceived benefits to perceived costs
(Zeithaml 1998). Prior research has also confirmed that con-
sumers’ convenience perceptions and service evaluations are
influenced by high time and energy costs (Bitner 1990; Berry
et al. 2002). Consumer waiting time research suggests that
there is tight relationship between consumers’ evaluation of
the service and their waiting time in an EME, for example,
download delay is closely related to the consumer’s evaluation
of electronic service retailer (Rose and Straub 2001; Rose
et al. 2005). As one major component of service evaluation,
we believe that there is positive relationship between con-
sumers’ perceived value and service convenience.
Hypothesis 9 Service convenience will positively influence
consumers’ perceived value of service in the
EME.
Commitment
Interactions between consumers and service providers are built
around episodic experiences (Chesbrough and Spohrer 2006;
Vargo and Lusch 2011), which will ultimately affect consumer
commitment to the EME service provider (Dai and Salam
2010). In EME the consumer is “always considered as a co-
creator of value” (Vargo and Lusch 2006, pp. 44). There is “no
value until the offering is used” (Vargo and Lusch 2006, pp. 44)
and that “experience and perception” (Vargo and Lusch 2006,
pp. 44) of service convenience are integral to the determination
of commitment in the context of the service consumption pro-
cess. Therefore, we believe service convenience will influence a
consumer’s commitment on the selected Service in EME.
Hypothesis 10 Service Convenience is positively associated
with a consumers’ commitment towards ser-
vice in EME.
Loyalty
Achieving customer loyalty is critical for EME service pro-
vider economic success (Roberts et al. 2003; Lin and Wang
2006; Gefen 2002; Rust and Kannan 2003). The fear in the
online environment is that the inherent low switching costs
enable competing online firms to be just a click away
(Tarafdar and Zhang 2007). Loyalty can be defined both
behaviourally and attitudinally. Behaviourally, loyalty con-
sists of repeated purchases of a brand, whereas attitudinally
loyalty includes a degree of dispositional commitment in
terms of some unique value associated with the brand
(Zeithaml et al. 1996). Accordingly, in order to develop
Service quality, service convenience and exchange relationship
long-term mutual relationships, managers must make great
efforts to improve the convenience of their services in the
electronic environment from the first encounter, through pur-
chasing, to delivery and beyond, as this can influence the
service retention (customer loyalty) and service growth
(word-of-mouth communication) (Bolton et al. 2000). Prior
literature confirmed that perceived are important determinants
of consumer loyalty in the online environment (Lin and Wang
2006; Gefen 2002).
Hypothesis 11 Consumers’ perceived value will positively
influence their loyalty to the service provider
in the EME.
Hypothesis 12 Consumers’ commitment will positively in-
fluence their loyalty to the service provider in
the EME.
Word-of-mouth communication
Word-of-mouth communication essentially represents the value
of the existing customers who spread good words about the
company and its products and services (Anderson 1998; Richins
1983). Word-of-Mouth communication has been found to be an
important outcome of exchange relationship between service
providers and consumers (Richins 1983; Srinivasan et al.
2002; Harrison-Walker 2001). Loyal customers always refer
new customers to suppliers. In the online environment, “word-
of-mouse” spread even faster than “word of mouth” since online
customers can, for example, use e-mail to broadcast a recom-
mendation for a favorite service provider to dozens of friends
and family members (Reichheld and Schefter 2000) quickly and
with very little effort. In this study, we have included word-of-
mouth communication as an outcome of the relational exchange
between the consumers and service providers.
Hypothesis 13 Consumers’ perceived value will positively
influence their word-of-mouth communica-
tion about the service provider in the EME.
Hypothesis 14 Consumers’ commitment will positively in-
fluence their word-of-mouth communication
about the service provider in the EME.
Research methodology
Measurement development
This study applied the survey methodology in assessing the
proposed comprehensive research model (Fig. 2). The devel-
opment of the survey instrument followed Moore and Benbasat
(1991) and Straub (1989). The measures for each of the service
275
convenience dimensions were adapted from prior service con-
venience studies in the marketing literature with some modifi-
cations (Seiders et al. 2000, 2007; Berry et al. 2002). The
service content quality and service delivery quality measures
were adapted from the Tan et al. (2007) study. The measure-
ment of relational exchange constructs were generated from
existing marketing and information systems literature to capture
consumer’s evaluation of service (perceived value and commit-
ment) (Lin and Wang 2006; Oliver 1992, 1999; Garbarino and
Johnson 1999) and their orientations for a long-term relation-
ship development (loyalty and word-of-mouth communication)
(Gefen 2002; Anderson 1998; Richins 1983). All items were
measured using a five-point Likert-type scale (1=“Strongly
disagree” to 5=“Strongly agree”).
Pilot study
We conducted a pilot test where the services chosen by respon-
dents included electronic banking, mortgage provider service,
online music buying service, and online car insurance provider
service, etc. We found no statistical difference between these
different types of services (Pavlou and Fygenson 2006). We
followed general rules from prior IS research to validate survey
instruments (Werts et al. 1974; Straub 1989; Moore and Benbasat
1991; Chin et al. 2003). In addition, our respondents gave verbal
and written feedback upon completion of the survey. Based on
this feedback, changes were made to improve the layout of the
survey form and the phrasing of some survey questions.
Sample demographics
The survey was distributed online and participants, both stu-
dents and non-students, were asked to identify one EME
service they used the most over the last 6 months and report
on their experiences. The major types of services included
electronic banking services, online purchases, online music
buying services, and online entertainment services. We found
no statistical differences among these different types of ser-
vices through an ANOVA test of all principle constructs. A
total of 788 responses were collected, with 16 incomplete
questionnaires dropped due to inadequate information yield-
ing a total of 772 valid responses. Table 1 presents the details
of descriptive statistics of respondents’ characteristics.
Data analysis
Data analysis method
The structural equation modeling (SEM) approach was used
to analyze the data for both the measurement model and
structural model in this study since the SEM based procedure
276 H. Dai, A.F. Salam

Table 1 Sample characteristics (N=772) fully complete the survey did not differ in their demographic
Measure Value Frequency Percentage characteristics and their responses on principal constructs
(Pavlou and Gefen 2005).
Gender Male 221 28.6 %
Female 551 71.4 % Reliability of refined instrument
Age 18–25 587 76.0 %
26–35 121 15.7 % This study presents measurement validations following Straub
36–55 59 7.7 % and Carlson (1989), Doll and Torkzadeh (1988), and Nunnaly
>55 5 0.6 % (1978; 1994). Convergent and discriminant validity of the
Education High school 64 8.3 % scale was evaluated according to Nunnally and Bernstein
Some college 489 63.3 % (1994), Chin et al. (2003), and Pavlou and Fygenson (2006).
Bachelor 137 17.7 % Prior studies have indicated that internal consistency for the
Master 76 9.8 % constructs is further validated through composite reliability
Ph.D. 6 0.7 % and Average Variance Extracted (AVE) (Fornell and Larcker
Income level <$12,000 526 68.2 % 1981; Tan et al. 2013). Typically 0.70 is considered as the
$12,000–$36,000 167 21.6 % threshold of internal consistency for all variables (Nunnally
$36,000–$60,000 34 4.4 % and Bernstein 1994; Pavlou and Fygenson 2006). All con-
$6,0000–$96,000 15 1.9 % structs exhibited high reliability (>0.85) in our sample. Thus,
>$96,000 30 3.9 % the measurements fulfilled the requirement of convergent
validity.
To overcome the concern for common method bias in the
provides powerful ways to address key IS research problems survey design, we first included several reverse-scored items
(Chin and Todd 1995; Moore and Benbasat 1991; Chin et al. in the principal constructs to reduce acquiescence problem
2003). The software used is SmartPLS 2.0 (Ringle et al. (Pavlou and Gefen 2005). We then used Harman’s one-factor
2005). test to assess common method variance after data collection
was complete (Podsakoff and Organ 1986; Pavlou and Gefen
Measurement validation 2005). Our further analysis indicates that there is no common
method bias in our study (Pavlou and Gefen 2005; Lindell and
Descriptive statistics Whitney 2001).

The descriptive statistics are reported in Tables 2 and 5
(Appendix) respectively. Reported statistics include Mean,
Standard Deviation (S.D.), and Inter-construct correlation ma-
trix. Non-response bias was assessed by investigating that the
early and late respondents as well as respondents that did not
Validation of formative second-order construct
To estimate the formative second-order construct Service
Convenience in the EME, we modelled the coefficients (γi)
of each first-order factor to the latent second-order factor

Table 2 Inter-construct correlation matrix for principal construct

1 2 3 4 5 6 7 8 9 10 11 12 13

1. ACCESSIBILITY 1.00
2. RELIABILITY 0.81 1.00
3. TIMELINESS 0.71 0.69 1.00
4. VISUAL APPEARANCE 0.68 0.66 0.65 1.00
5. NAVIGATION 0.77 0.76 0.70 0.75 1.00
6. CONTENT FLEXIBILITY 0.61 0.58 0.62 0.63 0.62 1.00
7. CONTENT QUALITY 0.79 0.78 0.79 0.68 0.75 0.61 1.00
8. DELIVERY QUALITY 0.80 0.78 0.76 0.71 0.76 0.61 0.86 1.00
9. SERVICE CONVENIENCE 0.80 0.78 0.77 0.76 0.79 0.68 0.83 0.85 1.00
10. VALUE 0.69 0.65 0.67 0.68 0.70 0.58 0.71 0.72 0.81 1.00
11. COMMITMENT 0.34 0.32 0.44 0.47 0.42 0.45 0.39 0.40 0.47 0.51 1.00
12. LOYALTY 0.51 0.50 0.55 0.53 0.51 0.52 0.55 0.54 0.63 0.61 0.44 1.00
13. WORD-OF MOUTH 0.47 0.43 0.51 0.55 0.53 0.52 0.52 0.52 0.61 0.61 0.60 0.59 1.00
Service quality, service convenience and exchange relationship
***
9 0*
0.1
0 .2
Service Search Service Decision Service Access
Convenience in Convenience in Convenience in
the EME the EME the EME
Fig. 3 Formative relationships between first-order constructs and second-order construct (All Paths Significant at p<0.001)
(Service Convenience) using a principal components factor
analysis using the procedure outlined by Diamantopoulos and
Winklhofer (2001, p. 270).
Service Convenience=γ1 X Service Search Convenience+
γ2 X Service Decision Convenience+γ3 X Service Access
Convenience+γ4 X Service Transaction Convenience+γ5 X
Service Benefit Convenience + γ6 X Service Post-Benefit
Convenience
As shown in the Fig. 3 below, all first-order factors
that capture the various dimensions of Service
Convenience in the EME are significant (p < 0.01).
Estimation problems occur in formative models in the
presence of severe multicollinearty because multiple re-
gression link the formative indicators to the constructs
(Diamantopoulos and Winklhofer 2001). The correlations
among the first-order constructs ranged between 0.65 and
0.73 (p<0.01). A formative model is supported and like-
ly than a reflective model, which would render extremely
high correlations (often above 0.80) (Pavlou, Dimoka,
and Housel 2008). We also tested for multi-collinearity
by calculating the variance inflation factor (VIF). VIF
assesses the degree of multicollinearity. The VIF values
ranged from 2.519 to 4.132 with the highest VIF (3.112 -
SearchCV, 3.174 - AccessCV, 4.132 - DecisonCV, 3.311-
TransactionCV, 2.519 - ServicePostBNCV, 3.436 -
ServiceBNCV) being 4.132 which is far below the cut-
off value of VIF>10 or its tolerance equivalent (Giere
et al. 2006; Hair, Anderson, Tatham and Black 1998;
Kennedy 2003).
We also tested whether the second order construct fully
mediates the impact of the first-order constructs. This step
ensures that the second-order construct is a more parsimoni-
ous representation of the first-order constructs and is able to
fully capture their predictive power on dependent variables
(Chin 1998). In short, these tests support the proposed second-
order formative model of Service Convenience and verify its
construct validity.
277
Service
Convenience in the
EME
0 .1
0.1
** 0.1
9* *
9* 8**
9**
* *
*
0.1
*
Service Service Post-
Service Benefit
Transaction Benefit
Convenience in
Convenience in Convenience in
the EME
the EME the EME
Testing the structural model
PLS path coefficients are shown in Fig. 4. Item loadings of
each construct are omitted for a clear exposition.
The results of the PLS structural model test reflect a sig-
nificant positive association between visual appearance and
service content quality in EME (β=0.189, p<0.001); naviga-
tion is also positively associated with service content quality
(β =0.495, p<0.001); Flexibility is also supported in terms of
its relationship with service content quality (b = 0.185,
p<0.001). Reliability also has significant impact on service
content quality in EME (β =0.495, p<0.001). These results
provide support for H4, H5, and H6. Three antecedents of
service content quality are able to explain 61.3 % variances of
service content quality.
The accessibility results demonstrate a strong influ-
ence on service delivery quality in EME (β = 0.306,
p<0.001). Reliability is also positively associated with
service delivery quality (β =0.304, p<0.001). There is
also strong statistical support for the relationship between
timeliness and service delivery quality (b = 0.335,
p < 0.001). Accessibility, reliability, and timeliness are
able to explain 73.4 % variances of service delivery
quality. Thus, H1, H2, and H3 are supported.
As depicted by the PLS structural model testing results of
(Fig. 4), service delivery quality strongly influenced service
convenience in the EME (β=0.524, p<0.001). Service con-
tent quality also has positive impacts on consumer service
convenience perception (β=0.379, p<0.001). These results
provide the support for H7and H8 respectively. Both service
delivery quality and service content quality are able to explain
76 % variance of service convenience.
We also tested whether second order service convenience
fully mediated the relationships between service delivery
quality and service content quality and outcome variables
such as value and commitment. We found that service conve-
nience fully mediated these relationships.
278 H. Dai, A.F. Salam

Accessbility
0.3
6* 0
** Service Delivery
Value
Reliability 0.304*** Quality 0.525
R²=66.9% *** Loyalty
**
* R²=73.4%
35 R²=38.9%

0.4
0.5

*
0.3

**

1
24*

6*
18
Timeliness

**
0.8
**
Service
Convenience
R²=76.0%

**
(Second Order)

0.4
Word-of-mouth

60*
*
Visual

94
9**
Communication

**

0.1
Appearance *

0.37

*
0.1 0** R²=47.3%
89
** Commitment 0.37
* Service Content R²=24.4%
Flexibility 0.185*** Quality
**
* R²=61.3%
.4 95
0
Navigation

Fig. 4 PLS results for structural model N=772, *** significant at p<0.001

With regard to the consequents component of the model, Discussion

service convenience shows strong impacts on consumer per-
ceived value (β=0.818, p < 0.001) and commitment
(β=0.494, p<0.001). These statistical results support H9 and
H10. The global service convenience perception is able to
explain 66.9 % of variance of consumer perceived value of
service in the EME. Moreover, 24.4 % of the variance of
consumer commitment in the EME is explained by service
convenience.
All hypotheses in relational exchange are supported. The
perceived value has significant impacts on loyalty (β=0.525,
p<0.001), and word-of-mouth communication (β=0.416,
p<0.001). Commitment also demonstrated positive associa-
tions with both loyalty (β=0.160, p<0.001) and word-of-
mouth communication (β=0.370, p<0.001). As the relational
outcome, 38.9 % of variance has been explained by
customer loyalty and 47.3 % of variance of word-of-
mouth communication respectively. These results validat-
ed H11, H12, H113, and H14. Summary of the hypoth-
eses testing is in Tables 3 and 4.
The goal of this study was to investigate the effect of service
convenience in conjunction with online service content quality
and service delivery quality on exchange relationship between
customers and online service providers. We conceptualized
and empirically established service convenience (Yale and
Venkatesh 1986) as a second order formative construct with
six first order dimensions. We have empirically tested a re-
search model where service convenience mediated the rela-
tionship between service delivery quality and service content
quality and exchange relationship variables value and commit-
ment. These findings (Figs. 3 and 4 and Tables 3 and 4)
collectively answer the first part of our research question.
Our findings indicated that all six convenience dimensions
contributed to consumer overall service convenience percep-
tion. The formative relationship between first order service
convenience dimensions and the second order service conve-
nience construct shows that each service convenience dimen-
sion is equally important to consumer overall judgment. Our

Table 3 Summary of hypotheses tests and results (Antecedents)

Hypothesis Path descriptions Hypothesized direction Path coefficients T-statistic Support

H1 Accessibility→Service Delivery Quality (+) 0.306 3.989 Yes

H2 Reliability→Service Delivery Quality (+) 0.304 4.288 Yes
H3 Timeliness→Service Delivery Quality (+) 0.335 5.870 Yes
H4 Visual Appearance→Service Content Quality (+) 0.189 2.974 Yes
H5 Flexibility→Service Content Quality (+) 0.185 2.881 Yes
H6 Navigation→Service Content Quality (+) 0.495 7.427 Yes
H7 Service delivery quality→Service convenience in the EME (+) 0.524 8.790 Yes
H8 Service content quality→Service convenience in the EME (+) 0.379 6.210 Yes
Service quality, service convenience and exchange relationship
Table 4 Summary of hypotheses tests and results (Consequents)
Hypothesis Path descriptions
H9 Service Convenience in the EME→Perceived value
H10 Service convenience in the EME→Commitment
H11 Perceived value→loyalty
H12 Commitment→Loyalty
H13 Perceived value→word-ofmouth
H14 Commitment→word-ofmouth
conceptual framework and subsequent empirical testing dem-
onstrated strong explanatory power of service convenience and
relational exchange in the EME. All of the hypotheses we
proposed were supported with statistical significance (see
Tables 3 and 4) thus providing evidence that along with online
service quality, service convenience plays a strong and statis-
tically significant mediating role in determining exchange
relationship between consumers and online service providers.
Thus collectively answering the second part of our research
question.
This study extended Tan et al. (2013) research of e-
government service into a more generic context in which
various categories of online services such as online retail,
online banking etc. In our research, we have found that service
convenience in the EME explained respectively 66.9 and
24.4 % of the variance of value and commitment with service
consumption in the EME. This finding clearly demonstrates
the value of service convenience in developing long term
exchange relationships between consumers and service pro-
viders. Additionally, our analyses demonstrates that perceived
value and commitment accounts for respectively 38.9 and
47.3 % of the variance of loyalty and word-of-mouth commu-
nication related to services in the EME. This result further
confirms that we were able to properly conceptualize service
convenience as a second order factor, with six formative
dimensions, that mediated between antecedents of service
quality and exchange relationship.
Additionally, our research model incorporated and empir-
ically verified important determinants of service quality such
as accessibility, reliability, timeliness, visual appeal, naviga-
tion and flexibility (see Fig. 4 and Table 3). We thus consid-
ered a more comprehensive theoretical model incorporating
determinants of online service quality, second order service
convenience (with latent six first order factors) and their
collective effect on exchange relationship outcomes such
as value, commitment and loyalty and Word-of-Mouth
communication. According to the authors’ knowledge
this is one of the first studies to comprehensively inves-
tigate and empirically validate such a comprehensive
model of exchange relationship among consumers and
online service providers.
279
Hypothesized direction Path coefficients T-statistic Support
(+) 0.818 26.977 Yes
(+) 0.494 9.821 Yes
(+) 0.525 8.105 Yes
(+) 0.160 2.635 Yes
(+) 0.416 6.870 Yes
(+) 0.370 6.444 Yes
Implications, limitations and conclusion
Theoretical implication
For academicians in IS and related fields, this research
contributes to the current literature in the following
significant ways. First, this study attempts to fill a void
by introducing service convenience concept in the EME
to IS research. Since service convenience is intuitively
and logically critical success factor to engender online
consumers’ value perception and commitment, a rigor-
ous development and validation of this construct should
prove beneficial. Second, this research also attempts to
establish and test the antecedents and outcomes of ser-
vice convenience in the EME from the consumer’s
perspective. The comprehensive framework provides a
complete nomological network for future research to
investigate service convenience in different settings so
that systematic knowledge can be accumulated.
Practical implication
Our results demonstrate that accessibility, timeliness and reli-
ability of online service provider web sites have significant
effect on service delivery quality as perceived by consumers,
which in turn has significant effect on service convenience
and then on loyalty and word-of-mouth communications. For
example, if a consumer finds that the online service provider’s
site is inaccessible and is not reliable then the consumer will
consider switching to an alternate online service provider. In
our interviews with study participants, we found that some of
them found inaccessibility and lack of reliability to be major
reasons for them to switch to alternate service providers.
Companies can hire third-party online service assessment
firms to learn how their online services are being perceived
by typical consumers and make necessary changes. We also
found visual appeal (web site design characteristics), naviga-
tion (web site layout and links across pages) and flexibility as
significantly important for consumers to perceive high service
content quality. This is especially important when web sites
change frequently due to new service offerings or changes in
280 H. Dai, A.F. Salam

existing laws or regulations thus likely resulting in a low
search, decision and transaction convenience. For example,
Health IT makes health-care convenient through rapid infor-
mation sharing, reduced paperwork, reduced unnecessary
tests, and faster and more accurate prescriptions (www.
healthit.gov). Consumers find changed or updated web sites
to be difficult to use and benefit from due to compromised
service convenience. Online service providers should assess
visual appeal, navigation and flexibility as well as search,
decision, transaction and access convenience. For example,
Macy’s and Bloomingdales enhance customer service and
convenience and customer engagement using advanced
information technologies that allow search convenience
across different brands, while enhancing visual appeal of
their products (www.macysinc.com/pressroom). To improve
the service convenience, online service providers must try to
enhance their interactive service systems, online store design
and layout, especially the display of the product and service
information. Online stores and service information need to be
visually attractive, easy to navigate, rich in information and
content, and flawless and impeccable (Éthier et al. 2006) in
order to improve the content quality and delivery quality of
the service systems in the EME. Adding convenience is an
opportunity for companies of all sizes. While big companies
such as amazon.com and Avis.com can leverage their re-
sources and scale to build their convenience factors, small
companies can take advantage of their nimbleness, flexibility,
and more intimate customer relationships to cater to the cus-
tomer in ways big companies cannot (Inc.com).
Our study yielded meaningful results; however, some
limitations need to be noted. The validity of our results
strongly depend upon the sampling of the surveyed
subjects. However, one strength of this research is that
we have used responses from a mix of student as well
non-student subjects (Ahuja, 2003). There may be other
factors that contribute to consumers’ perception of ser-
vice convenience in EME, for example, service enjoy-
ment (Dai et al. 2011), service delay (Lee et al. 2012),
service separation (Keh and Pang 2010; Luo et al.
2012). Future research should include these constructs
and theories in evaluating service convenience and ex-
change relationship.

Appendix 1

Table 5 Measurement items, mean, SD and factor loadings for principal constructs

Items used for principal constructs Mean Std. Loading

deviation (Refined)

Accessibility (Composite Reliability=0.97; AVE=0.90;Wixom and Todd 2005)

This Service provider’s website allows information to be readily accessible to me. 4.26 0.92 0.94
This Service provider’s website makes information very accessible. 4.21 0.93 0.96
This Service provider’s website makes information easy to access. 4.21 0.93 0.95
Reliability (Composite Reliability=0.97; AVE=0.92; Wixom and Todd 2005)
This service provider’s website operates reliably. 4.25 0.92 0.96
This service provider’s website performs reliably. 4.23 0.92 0.97
The operation of this service provider’s website is dependable. 4.22 0.92 0.94
Timeliness (Composite Reliability=0.94;AVE=0.88; Wixom and Todd 2005)
It takes too long for this service provider to respond to my request. 2.64 0.32 (Deleted)
This service provider provides service in a timely fashion. 4.03 0.90 0.95
This service provider returns answer to my questions quickly. 3.82 0.90 0.93
Visual Appearance (Composite Reliability=0.95,AVE=0.81; Heijden 2005; Fassnacht and Koese 2006; Collier and Bienstock 2006)
This service provider’s website is visually pleasing 4.07 0.95 0.90
The lay-out of this service provider’s website is attractive 4.00 0.93 0.92
The colours that are used on this service provider’s website are attractive 3.91 0.96 0.88
Everything is clearly arranged in this service provider’s website 4.06 0.98 0.82
Overall, I find this service provider’s website to be attractive 4.00 0.92 0.93
Navigation (Composite Reliability=0.92,AVE=0.75; Novak et al., 2000, Marketing Science; Skadberg and Kimmel, 2004)
I felt that I had the freedom to go anywhere in this service provider’s website 4.02 0.99 0.81
I felt interacting with this service provider’s website was easy 4.14 0.93 0.88
Service quality, service convenience and exchange relationship 281

Table 5 (continued)

Items used for principal constructs Mean Std. Loading

deviation (Refined)

When I use this service provider’s website, there is very little waiting time between my actions and the 4.06 1.00 0.88
computer’s response.
Pages on this service provider’s website that I visit usually load quickly 4.10 0.96 0.88
Content Flexibility (Composite Reliability=0.93; AVE=0.83; Wixom and Todd 2005)
This Service provider’s website can be adapted to meet a variety of needs. 4.03 0.94 0.91
This Service provider’s website can flexibility adjust to new demands of conditions 3.80 1.00 0.92
This Service provider’s website is versatile in addressing needs as they arise 3.78 1.02 0.91
Service Content Quality (Composite Reliability=0.96; AVE=0.89; Tan et al 2013; Fassnacht and Koese 2006)
Generally, the service content offered on this ESP’s website to support me in performing my transactions is satisfactory. 4.03 0.94 0.91
On the whole, the service content offered on this ESP’s website is highly effective in supporting me to 4.03 0.96 0.94
perform my transactions.
Generally, I am pleased with the service content offered on this ESP’s website to support me in performing transactions. 4.06 0.93 0.93
Service Delivery Quality (Composite Reliability=0.96, AVE=0.88; Tan et al 2013; Fassnacht and Koese 2006)
The general technological mechanisms underlying various service functionalities of this ESP website are satisfactory. 4.00 0.92 0.94
Generally, the service functionalities are delivered in a professional manner in this ESP’s website 4.06 0.92 0.94
Service Convenience in EME
I. Service Decision Convenience in the EME (Reliability=0.87; Berry et al. 2002; Seiders et al. 2007)
It took minimal time to get the information needed to choose this online ESP. 4.03 0.94 0.83
Making up my mind about what I wanted to buy from this online ESP was easy. 3.77 0.97 0.81
It was easy to get the information I needed to decide which online ESP to use. 3.97 0.90 0.86
It was convenient to decide if I should buy service from this online ESP 3.89 0.92 0.86
II. Service Access Convenience in the EME (Reliability=0.92; Berry et al. 2002; Seiders et al. 2007)
It was easy to contact the online ESP 3.88 0.97 0.87
It did not take much time to reach the online ESP. 3.90 0.97 0.88
I was able to get to the online ESP’s website quickly 4.09 0.97 0.91
It was convenient to search on this online ESP’s site 3.97 1.02 0.86
IV. Service Transaction Convenience (Reliability=0.90; Berry et al. 2002; Seiders et al. 2007)
I did not have to make much of an effort to pay for the service. 3.95 0.97 0.82
This online ESP made it easy for me to conclude my purchase. 3.97 0.93 0.90
It was convenient to transact with this online ESP 4.05 0.94 0.88
I was able to complete my purchase quickly. 3.97 0.95 0.88
V. Service Benefit Convenience (Reliability=0.92; Berry et al. 2002; Seiders et al. 2007)
I was able to get the benefits of the service with minimal effort. 4.08 0.95 0.91
This online service was easy to use. 4.17 0.95 0.93
The time required to receive the benefits of the service was appropriate. 4.07 0.95 0.92
VI. Service Post- Benefit Convenience (Reliability=0.91; Berry et al. 2002; Seiders et al. 2007)
This online ESP resolved my problem quickly. 3.88 0.93 0.91
It took little effort to arrange follow-up service. 3.81 0.92 0.88
This online ESP made it easy for me to resolve my problem 3.86 0.95 0.91
Perceived Value (Composite Reliability=0.95, AVE=0.77; Lin and Wang 2006; Oliver 1999)
The prices I pay for service from this online ESP represent a very good deal. 3.69 1.01 0.76
The time I spend in order to use this from this ESP’s site is highly reasonable. 3.92 0.97 0.87
The effort involved in using this service at this ESP’s site is worthwhile. 3.99 0.94 0.90
The service consumption experience at this ESP’s site is excellent. 3.88 0.95 0.88
I found significant value by using service from this provider. 3.95 0.96 0.86
Commitment (Composite Reliability=0.94, AVE=0.79; Anderson 1998; Gefen 2002)
My relationship to this specific online service provider is something that I am very committed to. 3.64 1.06 0.90
My relationship to this specific online service provider is very important to me 3.56 1.06 0.94
282
Table 5 (continued)
Items used for principal constructs
My relationship to this specific online service provider is something I really care about.
My relationship to this specific online service provider deserves my maximum effort to maintain.
Loyalty (Composite Reliability=1.00, AVE=1.00; Gefen 2002)
I have a strong relationship with this online vector.
I will choose this ESP next time when I purchase same service.
Word-of-mouth Communication (Composite Reliability=0.93, AVE=0.83; Anderson 1998; Richins 1983)
I often recommend this ESP to others.
I tell my friends about this ESP.
I want my friends to buy from this ESP.
ESP stands for Electronic Service Provider identified by subject
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