The Effect of Location, Product Diversity, and Store Atmosphere on Increasing Customer Satisfaction

The primary objective of this study is to empirically examine and evaluate the impact of location considerations, product diversity


Introduction
In recent years, there has been a notable escalation in rivalry within the retail sector in Indonesia, driven mainly by the proliferation of modern minimarkets across various localities.According to data provided by the Directorate General of Domestic Trade under the Ministry of Trade, there was a notable increase in the consumption of fast-moving consumer goods (FMCG) within the modern retail sector.Specifically, from April 2018 to April 2019, the overall growth rate stood at 6.6%.Minimarkets, which made a significant contribution and had an impressive growth rate of 12.1%, were the leading cause of this increase.In contrast, supermarkets observed a decline in growth by a magnitude of -6.8%.This finding suggests that individuals prefer patronizing minimarkets for their everyday shopping requirements owing to the convenience of their proximity to residential zones.Despite experiencing growth, the retail industry has also encountered a downturn attributed to millennials' preference for online enterprises and the transition of certain shops towards online business models.The available data indicates a rise of 2.1% in retail sales during September 2019, compared to a 1.1% gain observed in August 2019.This shift in consumer behavior suggests a notable alteration in buying patterns, reinforcing online retail enterprises' expansion within the Indonesian market.
In retail company competition, entrepreneurs must consistently focus on the various aspects that influence their success.An essential determinant is the comprehension of consumer behavior, including the individual attributes about the acquisition, utilization, and contentment derived from a specific product or service.A comprehensive understanding of consumer behavior can facilitate the establishment of client loyalty, as customer happiness is widely regarded as a critical metric for evaluating market performance (Bahri, 2018).Consumer satisfaction refers to the state in which consumers' expectations are either met or surpassed, whereas consumer dissatisfaction arises when these expectations are not fulfilled.This phenomenon significantly impacts customer behavior, developing consumer loyalty (Sambara et al., 2021).Furthermore, the choice of location holds significant importance in the retail business (Kurniawan, 2018).A strategic location enhances the efficiency of product or service distribution between producers and consumers.The strategic positioning of outlets or stores can significantly improve their success rates compared to those in less advantageous locations.The proximity of a business to a large gathering of people, convenient accessibility, and ample parking facilities can influence the firm's success.In the context of consumer preferences, Tjiptono, (2016) also emphasizes the significance of comprehensive and diverse product offerings.Individuals tend to gravitate towards establishments that provide a diverse range of complete merchandise.This facilitates the selection of products by consumers based on their preferences.Product completeness refers to the extent of product variety, alignment with customer preferences, and the accessibility of products for consumer ownership, utilization, or consumption (Sari & Setiyowati, 2017).To effectively navigate the competitive landscape of the retail industry, entrepreneurs must possess a comprehensive understanding of consumer behavior, make informed decisions regarding selecting strategic sites, and offer a wide range of comprehensive and tailored items to suit customer expectations.By doing so, entrepreneurs can foster customer loyalty and enhance their prospects for success in this highly competitive sector (Kotler & Keller, 2016).
The impact of store ambiance on consumer attraction and buying behavior is crucial in the retail industry.According to Prasyanti et al., (2021) the presence of a pleasant and comfortable store ambiance can foster a sense of familiarity and ease among consumers, thereby increasing the likelihood of their engagement in purchase behavior.Furthermore, the store's atmosphere serves as a form of communication that can yield favorable outcomes for the retail industry by cultivating a distinctive shopping encounter tailored to the specific market segment (Kotler & Armstrong, 2018).The community's proliferation of major minimarket chains, such as Indomaret, Alfamart, and Alfamidi, has notably influenced competitiveness within the retail industry.The proximity of these establishments near one another provides consumers with many options, owing to factors such as a diverse range of items, competitive pricing, convenient accessibility, and well-maintained and pleasant retail environments.This phenomenon presents difficulties for other retailers seeking to engage in competition.The existing body of research on consumer satisfaction has yielded varying results.Andriyana, (2017) conducted a study that revealed that several elements, namely product diversity, store environment, and location, exert a partial yet considerable impact on customer satisfaction.While finding that product diversity does not have a statistically significant effect on customer satisfaction, a recent survey by Wiyono & Wardhana, (2021) emphasizes the importance of the business location aspect in attracting consumer attention.Dewi et al., (2021) recent study discovered that several variables, such as store ambiance, location, and service quality, notably and positively impact customer satisfaction.
Toko 123 is a contemporary retail enterprise adopting a minimarket model, founded in 2012 within the urban confines of Makassar City.This establishment has effectively maintained a customer base and competed with modern retail establishments.While the assortment of products is very comprehensive, there are certain constraints regarding the available brands.Furthermore, the spatial configuration of the store's ambiance is characterized by limited expansiveness, with closely positioned shelves that contribute to a sense of congestion during peak periods of customer activity.However, the arrangement of merchandise shelves exhibits a well-structured organization based on their respective categories.In the highly competitive retail industry, providing a welcoming store

Source: Primary Data
The questionnaire contains questions about the respondent's data and the indicators of each variable used in this study.In measuring each variable indicator in this study, a Likert scale with five alternative answers was used, namely: Strongly agree (SS) with a score of 5, Agree (S) with a score of 4, Disagree (KS) with a score of 3, Disagree (TS) with a score of 2 and Strongly Disagree (STS) with a score of 1.The data that has been collected will be analyzed through several stages of testing.The first stage is to conduct a descriptive statistical test.The second stage is the research data instrument test (validity test, reliability test).The third stage is the classic assumption test (normality, heteroscedasticity, and multicollinearity tests).The fourth stage is to test all hypotheses proposed in this study, which will be proven through the coefficient of determination test, partial test (t test), and simultaneous test.

Findings
Respondents in this study are consumers who shop at Toko 123.There are five characteristics of respondents included in this study, namely based on gender, age, education, occupation, and shopping intensity.The second stage is a data quality test consisting of validity and reliability tests.This test is carried out to test the validity and reliability of each statement item in measuring variables.Validity testing in this study paid attention to the Pearson correlation level with a significance level of α = 0.50%.A measuring instrument is declared valid if the significance value is less than 0.5; otherwise, the measurement instrument is declared invalid if the significance value is more significant than 0.5.The questionnaire is reliable if the reliability coefficient is positive and more meaningful than 0.60.The results of the test can be seen in table 3. Based on table 3, all statement items used in this study to measure location factor variables, product diversity, store atmosphere, and customer satisfaction are valid.The value of each statement item based on the Corrected Item Total Correlation column has a coefficient value greater than 0.3 and smaller than the Sig value.0,05.Based on the table of reliability test results for all variables, it shows that Cronbach's Alpha value is more significant than 0.6, so it is declared reliable or suitable for use as a measuring instrument for the questionnaire instrument in this study.
The third stage is the classic assumption test, which consists of a normality test, a heteroscedasticity test, and a multicollinearity test.The normality test aims to see whether the residual value is normally distributed.The requirements for fulfilling this normality test are: if the significance is below 0.05, it means that the data is not normal; on the contrary, if the importance is above 0.05, the data can be said to be expected.Based on table 4, shows the sig value is 0.022, which means the sig value is more significant than 0.05.0.022 is more critical than 0.05, where the data is normal.Testing can also use a normal probability plot graph to compare the significance value.If the data spreads around the diagonal line and follows the direction of the diagonal line, the regression model fulfills the normality assumption.If the data applies far from the diagonal line and does not follow the diagonal line, the regression model does not satisfy the normality assumption.

Figure 2. Heteroscedasticity Test Results
Judging from Figure 1, the resulting data is normally distributed.Because the distribution of data remains around the residual line.So, the regression model fulfills the assumption of normality.Meanwhile, the data results in Figure 2 show that the points spread randomly do not form a specific pattern and are applied above and below the number 0 on the Y-axis.The Sig value of all independent variables in this study is more significant than 0.05.Thus, the data does not have heteroscedasticity problems in the regression model.The VIF value of all independent variables in this study is less than 10.00, while the tolerance value of all independent variables is more significant than 0.10.Thus, there are no symptoms of multicollinearity between independent variables in the regression model.
The fourth stage is hypothesis testing through multiple linear regression analyses.A multiple linear regression analysis is used to determine the direction of the relationship between the independent variable and the dependent variable.In this study, multiple linear regression analysis was performed with the help of the IBM SPSS 22 software application.Based on the calculation results of the multiple regression model, the regression equation results can be seen in table 5.

Source: Output SPSS
Based on the results of the SPSS output in table 5, the regression equation obtained is as follows: Y = 1,369 − 0,055X1 + 0, 432X2 + 0,331X3 ...............(1) This equation shows that the constant value of 1.369 indicates that if the assumptions of variables X1, X2, and X3 remain, customer satisfaction is 1.369.The regression coefficient of the location factor variable (X1) is 0.055, which means that if the location factor increases, customer satisfaction (Y) will decrease by 0.055-assuming variables X2 and X3.The location factor does not affect customer satisfaction.The regression coefficient of the product diversity variable (X2) is 0.432, which means if the product diversity increases, customer satisfaction (Y) will increase by 0.432.Assuming the X1 and X3 variables remain.The regression coefficient of the store atmosphere variable (X3) is 0.331, which means that if the atmosphere increases, customer satisfaction (Y) will increase by 0.331.Assuming the X1 and X2 variables remain.The variable with the highest beta coefficient is the product diversity variable (X2), with a beta coefficient value of 0.497; the product diversity variable is also the most dominant in customer satisfaction.
The sig value on the location factor is 0.534.If the sig value is greater than the probability value 0.05, then H1 is rejected, and H0 is accepted.So, the location factor only significantly influences consumer satisfaction in shopping at Toko 123, Makassar.The sig value on product diversity is 0.000.The sig value is smaller than the probability value 0.05, so H1 is accepted, and H0 is rejected.Product diversity significantly influences customer satisfaction when shopping at 123 Store, Makassar.The sig value of the store atmosphere is 0.001.The sig value is smaller than the probability value 0.05, so H1 is accepted, and H0 is rejected.It can be concluded that the shop atmosphere significantly influences customer satisfaction when shopping at Shop 123, Makassar.
Test f (simultaneous test) is used to determine whether all independent variables, in general, have a significant effect on the dependent variable.Hypothesis testing is done by comparing the magnitude of the study's substantial level number (sig) with an effective 0.05; the test is carried out with the condition that if the significant number of studies is 0.05, Ho is rejected, and H1 is accepted.If the research significant number is > 0.05, Ho is accepted, and H1 is rejected.The test results can be seen in table 6.Source: Output SPSS Based on table 6, the significant value is 0.000 less than 0.05.So, the location factor, product diversity, and store atmosphere simultaneously affect customer satisfaction at Toko 123 Makassar.

Discussion
The research findings reveal substantial insights into the impact of specific aspects on consumer satisfaction at Toko 123, located in Makassar.Regarding geographical elements, including strategic positioning, convenient accessibility, sufficient parking, and store security, consumers rated these aspects highly, resulting in a notable degree of satisfaction.Nevertheless, the outcomes of the statistical examination are unexpected, as they indicate that location variables do not substantially impact customer satisfaction.This finding diverges from initial hypotheses and prior study discoveries.According to results from previous studies, a variety of factors related to product diversity have a significant impact on customer happiness.These factors include a wide range of items, alignment with consumer preferences, including domestic and international brands, and incorporating the latest product offerings.Similarly, the inclusion of store ambiance elements such as enough lighting, utilization of music, neutral room fragrance, suitable product placement, and comfortable temperature significantly enhance consumer happiness and align with past research findings.The findings presented herein can provide a foundation for subsequent investigation and comprehensive examination of the variables influencing customer satisfaction within this establishment.Additionally, these results can offer insights to inform the formulation of enhanced business tactics in subsequent endeavors.
The lack of a substantial impact of the location variable on customer satisfaction shown in the study may be attributed to certain contextual elements or dynamics present within the setting of Toko 123 in Makassar.This phenomenon can be attributed to the fact that consumers may assign varying degrees of importance to elements other than geographical proximity while making purchase choices.In contrast, a diverse range of products has favorably impacted customer satisfaction due to its ability to enhance the overall shopping experience and cater to various consumer demands and preferences.Consumers perceive that offering diverse products catering to their varied wants and preferences can enhance their happiness.Consumers see an increased array of options and a higher probability of locating products that align with their priorities.Providing products that align with consumers' unique desires and requirements can engender a sense of being attended to and esteemed, fostering a favorable connection with the brand and augmenting customer contentment.In addition, the store atmosphere component has the potential to influence consumer happiness positively.The enhanced shopping experience can be attributed to various factors, including a favorable store ambiance characterized by well-designed lighting, suitable music, neutral scents, and a compelling product arrangement.These elements collectively create a more enjoyable and engaging environment for consumers, fostering a sense of comfort and entertainment throughout their shopping endeavors.Providing a comfortable temperature and effective in-store security measures can enhance consumers' understanding of comfort and security.This enables individuals to concentrate on shopping without any external disturbances or concerns, improving their level of contentment.

Conclusion
This study examines the impact of several characteristics on customer satisfaction at Toko 123, located in Makassar.The findings indicate that both product diversity and retail atmosphere exert a noteworthy effect on customer satisfaction.Consumers highly value the assortment of items available, which encompasses a diverse range of offerings that cater to their individual preferences and requirements.This comprises domestic and worldwide brands and the most up-to-date products.Furthermore, providing a pleasant retail ambiance characterized by adequate illumination, suitable auditory stimuli, neutral olfactory cues, effective product organization, and optimal temperature has significantly enhanced consumer contentment.We propose measures to manage Toko 123, Makassar, to strengthen and uphold customer happiness.Firstly, it is necessary to improve further and revise the range of products to cater to the diverse requirements of consumers.
Furthermore, maintaining and enhancing the store's favorable ambiance is crucial.Reinforcing appropriate music, optimal layout, and conducive lighting can improve the overall experience.Moreover, it is imperative to maintain a suitable ambient temperature and a hygienic olfactory environment.Additionally, it is advisable to do additional research to understand other variables that may influence customer satisfaction and ascertain evolving consumer preferences.The study suggests that maintaining customer satisfaction plays a crucial role in customer retention and establishing a sustainable market position in intensifying corporate competition.Utilizing these data by the management of Toko 123 might serve as a valuable reference in formulating enhanced company strategies and prioritizing the aspects that have significantly impacted customer satisfaction.Furthermore, this study underscores the need to accommodate evolving consumer tastes and continuously enhance the buying experience.By implementing this strategy, Toko 123 has the potential to improve its brand reputation and attain sustained success within the market.

Table 2 .
Respondent Demographic Data Source: Primary Data kuesioner SPSS 22

Table 3 .
Validity and Reliablity Test Results Source: Output SPSS

Table 5 .
Multiple Linear Regression Analysis Results (Coefficients a )

Table 6 .
F-Statistical Test Results