“ALPAS”: BATAAN NATIONAL HIGH SCHOOL – SENIOR HIGH SCHOOL RESEARCH JOURNAL

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Customer Enagement: A Correlation on the Level

Of Profitability of MSMEs and Online Sellers

Bongat Stan P. , Alvarado Jyosh D., Balajadia Jena Mae N., Buenaventura,
Jerich Rain D., Datu Michel., Diwa Dianne B., Enriquez Nicole F., Navarro Krisha M.,
Reyes Christine Jane., San Juan Ellaika T., Valencia Athena Venice C.,

Bataan National High School – Senior High School

Stan.bongat@gmail.com, jyoshcazandreialvarado@gmail.com,
buenaventurajerichraind@gmail.com, micheldatu0@gmail.com, diannediwa8@gmail.com,
Cjreyes122504@gmail.com, ellaikasanjuan05@gmail.com
athenavlnc07@gmail.com,

Abstract – Customer Engagement is the process of interacting with customers through a

variety of channels in order to strengthen their relationship, (Coleman, 2022). The purpose
of this study is to investigate the relationship between customer engagement and the level
of profitability of Micro, Small, and Medium Enterprises (MSMEs) and online sellers. There
were 132 MSMEs and online sellers of the Division of Bataan involved in the study. The
respondents were selected according to their availability and their willingness to disclose
their profit. The survey questionnaire used was inspired by the work of Maduku et al.
(2016:719), Dahnil et al. (2014:121), and Jin and Phua (2014:189) to record the
respondents’ answers. The results revealed that the customer engagement of MSMEs and
online sellers is high. It also revealed that the customer engagement and the level of
profitability has no significant relationship.

INTRODUCTION pathway for obtaining quality profitability and

Customer engagement is the process of averting industry collapse.
interacting with customers through varied
According to Carter (2022), customer
channels to develop and strengthen a relationship
engagement can be referred to as the art of giving
with them. It is the emotional connection or
a concierge-like service to users. To be general,
attachment that a customer develops during the
customer engagement is essential as it enables us
repeated and ongoing interactions (Bansal, 2015).
to distinguish the customers interaction within a
According to Briglia (2020), customer engagement
specific business, organization, or even company.
makes advantages especially with the suppliers
Customer engagement has evolved into three
and buyers through increasing close rates while
attributes, namely: customer retention, loyalty,
meeting the customer expectations. In fact,
and willingness. Engagement accumulates
keeping the customer being engaged throughout
through satisfaction, loyalty, influence, and
their purchase journey helps to enhance customer
excitement about your brand (Bansal, 2015).
loyalty and collect valuable data. This signifies a

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According to Edwards and Duffy (2014), types of engagement to differ from one another,
profitability is the amount by which a business's particularly in terms of profit accumulation.
output is worth more than the resources utilized Recognizing your consumers' needs and where
to produce it. Profitability is, in general, the they will look for them are only a small part of
amount to which a corporation, or a single customer engagement. Additionally, figuring out
business, generates a profit — that is, revenue how to keep them interested is important.
gained above the costs of producing and selling
goods and services (Venicchi & Zanni, 2020). The basic objective of all business
endeavors is profitability. Long-term viability of
Customer engagement measurement is not
the company depends on profitability. Therefore,
an easy task. Because how would the company
estimating future profitability and analyzing
know how its consumers interact with it if
present and previous profitability are both crucial,
customer engagement wasn't measured?
according to Johans et al. (2019). Income and
Businesses need the proper tools and resources to
expenses are used to determine profitability.
manage and audit engagement because it can
Income is money that the firm makes through its
happen concurrently across various channels.
operations. For instance, money is made when
One must be ready to assess engagement
livestock and crops are raised and sold. On the
effectively because it can occur anytime, anyplace,
other hand, money that enters the company
whether it is on social media, a website, a mobile
through actions like borrowing money does not
device, or an email. They will also require a solid
generate profits. The business and the lender are
understanding of various media in order to
merely exchanging cash in order to raise funds for
appreciate the complexities of measuring client
the business's operations or the purchase of
engagement. More importantly, quantifying the
assets. A "profitability statement" is used to
effectiveness of a customer engagement strategy
measure profitability. This is essentially a
can provide insight into how satisfied customers
breakdown of the business's total revenue and
are with engagement activities. Additionally,
outlays during a specific time period (often a year).
organizations have the opportunity to flourish
One financial statement among many that can be
when they routinely review their customer
used to evaluate a company's financial health is
engagement approach. Using Google Analytics,
its income statement. Although there are
surveys, or email campaigns are a few examples of
numerous more statements that may be included,
techniques that may be used to gauge consumer
the balance sheet or net worth statement and the
involvement. Another option is to utilize a
cash flow statement are two other typical
feedback poll to gauge the level of customer
statements.
satisfaction (CSAT), as stated by Singh (2022). ‘

However, despite the fact that it's essential

Customer engagement, on the other hand, may
for guiding customers along their path, customer
still vary between low and high. There are
involvement is frequently disregarded. In order to
possibilities that become the reason for these two
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engage customers, a brand must first persuade Marketers rely on satisfaction metrics to
them to interact with it and actively participate in evaluate customer responses towards the
the experiences it is providing for them. If they company as satisfaction is believed to be
execute it properly, they will develop the brand, associated with increased purchased intention,
foster consumer loyalty, and ultimately increase customer loyalty, profitability and market share
income. The degree of consumer interaction does, (Abbas et al., 2018). Repurchase intention
in fact, directly and consistently correlate with describes the probability to continue purchase
corporate profitability. According to a products from the same vendor or store in the
Constellation Research report, businesses that future among satisfied customers (Chiu et al.,
boost engagement can boost cross-sell revenue by 2009). However, some argue that repurchase
22%, up-sell revenue by 38%, and order size by intention might not reflect true behavioral loyalty
5% to 85%. According to research by as some repurchases could be attributed to
Reputation.com, a high level of customer convenience or necessity needs rather than real
engagement boosts the Reputation Score, and in a engagement (Chi et al., 2009; Tseng et al., 2004).
number of industries, including the automobile Loyalty is hence should cover other behavioral
and healthcare sectors, direct relationships aspects such as intention to spread positive word-
between high Scores and revenue have been of- mouth. It is an important marketing tool that
discovered. is not only to be aimed at the customer, but is
also a significant indicator of the success of a
Customer engagement is significantly business (Vilkaite-Vaitone & Skackauskiene,
influenced by trust and certain clients need time 2020).
to build their trust. To be able to engage with and
Due to the general intense competition in
trust the products or services, they require
markets, businesses are having trouble retaining
adequate time. Interpersonal and professional
and gaining potential clients. Determining the
interactions thrive on trust. (Hsu et al., 2007; Van
requirements and wants of a customer is the first
Tonder & Petzer, 2018). Customers are more
step in establishing a connection with clients.
inclined to share pertinent information with the
Additionally, it is critical to be aware of how the
service provider when they perceive the company
customers' behavior and be sensitive to their
to be trustworthy, ensuring that the connection
needs and wants. The secret to customer
will continue to grow and flourish. (Cazier et al.,
engagement and profitability is marketing strategy.
2007; Chai & Kim, 2010). Additionally, trust is
According to Concibido (2021), the strategy must
thought to reduce perceived risks, strengthening
focus on marketing while ensuring that products
customers' loyalty to service providers (Van
and services meet customer needs and developing
Tonder & Petzer, 2018), and as a result, loyal
long-term and profitable relationships with
customers engage with business owners and
customers. This can be achieved by formulating a
exhibit greater customer loyalty (Brodie et al.,
flexible strategy that is responsive to changes in
2013; So et al., 2014).
customer perceptions and demand.
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The researchers plan to delve into and
discover the comparison between
engagements and profitability. Through the means
of utilizing public access to MSME (Micro, small,
and medium enterprises), the researchers will
take advantage of the ease of
information in order to find differentiation and
interrelatedness between the level of customer
engagements and profitability. That being said,
the objective is to find the average amount of
customer engagement by using social media as a
tool, wherein the researchers will gather 100
participants to answer a survey, after which the
researchers will cross-reference the results with
the information given by the MSME.
engagement and high customer engagement. It
customer has been identified that customer engagement
helps the brand, product, or industry obtain
success because of the positive implications it can
produce.
gaining the
It seeks answers to the following questions:
1. How may the level of customers engagement of
MSMEs be describe?
2. How may the level of profitability of MSMEs be
described in terms of monthly profit?
3. Is there a significant difference between MSMEs
with high and low level of customer engagement in
terms of profitability?

As a result, the data will be used to guide MATERIALS AND METHOD

the future researchers on the comparison on the To meet the study's goals, a quantitative
level of profitability of MSMEs on customer approach was used. A 5-point Likert Scale online
engagement. survey was utilized for the quantitative method to
identify the association between customer
OBJECTIVES OF THE STUDY
engagement and profitability of online sellers in
The general objective of this study was to
the Division of Bataan. For MSMEs, the
determine the customer engagement and
questionnaires were self-administered, which
profitability of online sellers and MSMEs in the
improved response through question clarification,
Division of Bataan using self-determined
especially for respondents who couldn't read and
questionnares and the work of Maduku et al.,
write. Responses from respondents were gathered
Dahnil et al, and Jin and Phua.
using both closed- and open-ended questionnaires.
In addition, the study aimed to describe the While open-ended questions served to clarify the
relationship of customer engagement and answers given in close-ended questionnaires, the
profitability of online sellers and MSMEs as well close-ended questions improved precision and
as identify how their interaction with customers conciseness. The following codes were used in this:
affects their profitability. 5 indicated strongly agree, 4 indicated agree, 3
indicated neither agree nor disagree, 2 indicated
RESEARCH QUESTIONS
disagree, and 1 indicated strongly disagree.
The study aims to determine the
connection between customer engagement and
PARTICIPANTS
profit. It determines a comparison of low customer

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 “ALPAS”: BATAAN NATIONAL HIGH SCHOOL – SENIOR HIGH SCHOOL RESEARCH JOURNAL
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The respondents for this study were 132
MSMEs and online sellers in the Division of
Bataan, who were non-randomly chosen using
the convenience sample technique. As defined,
convenience sampling refers to selections made
from sources that are easily accessible to the
researcher (Andrade, 2020).
As a result, the 132 respondents who readily
and easily completed both the online and
printed surveys were regarded as the study's
sample. Additionally, the researchers utilized
their knowledge to quickly and efficiently
gather the data required to finish the study.
Due to the unavailability of other business
owners and their refusal to disclose their
monthly profit by labeling it as confidential, a
sample population of carefully selected
business owners were chosen as participants in
the study.
INSTRUMENTS
A two-part questionnaire was the main instrument
utilized to collect relevant data for the study. A 5-
point Likert scale tool that was adapted from the
work of Maduku et al. (2016:719), Dahnil et al.
(2014:121), and Jin and Phua (2014:189) was
included in the first section (Maphathe, 2021). It
gave 20 statements in particular, to which
business owners assigned equivalent points in
accordance with their experiences as owners.
Consequently, it has already been proven that this
questionnaire is valid and reliable.
The second part included a question based on
their monthly profitability. The goal of this inquiry
was to elicit a thorough understanding of the
business owners' profitability.
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These statements and questionnaires were
printed on paper for MSMEs and encoded in a
Google survey administration tool for convenient
and simple data gathering from online sellers.
DATA COLLECTION PROCEDURE
The data gathering procedure was carried out
via online platforms and also through face-to-face
collection. For the purpose of informed consent,
an electronic letter was initially delivered to online
sellers, followed by a hardcopy letter to MSMEs
owners. The information from the respondents
was then collected via Facebook Messenger, the
Google survey administration tool, and on paper.
Descriptive statistics were used to calculate the
points listed in the first and second parts of the
questionnaire. The level of profitability indicated
in the respondents' responses was assessed based
on its relevance
Duetoto the unavailability
pre-established
of other
rangebusiness ow
specified in theAs
Senate
a result,
of the
the Philippines'
132 respondents
MSME
who readily
sector.
Due to the unavailability of other business ow
ETHICAL CONSIDERATIONS
Each step of the research procedure was made
sure to meet the ethical requirements established
by Bryman and Bell through deliberate efforts
(Anwar, 2016) [13]. Prior to collecting the data, an
informed consent was obtained from the
respondents under strict observance of respect,
concern for dignity, and welfare. Accordingly, the
respondents were fully informed of every aspect of
the project, including the confidentiality of the
data collected and their anonymity. The listed
books' authors were duly acknowledged as a sign
of respect for intellectual property. The use of a
statistical analysis and QDAMine lite ensured
objectivity in the handling of the data.
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MSMEs 254,686
RESULTS AND DISCUSSION
Table 1. Mean of Customer Engagement
1. MICRO 54,323.68 76%
of MSMEs and Online Sellers 2. SMALL 1,297,143 14%
MEAN DESCRIPT INTERPRETA-
-ION TION
3. MEDIUM 318,000 10%

MSMEs 4.15 Agree High ONLINE 103,793 100%

Customer
SELLERS
Engagement
ONLINE 4.41 Strongly High
SELLERS
Agree Customer Legend: SMEs Classification. MSMEs are

Engagement determined by the amount of their assets (DTI-

SMEDC & PSA):

The table shows the custoer engagement of Category Amount of Assets

MSMEs and online sellers. As shown in the table, Micro Below 3,000,000

MSMEs has the mean of 4.15 that corresponds Small 3,000,001-15,000,000

with the meaning of agree. While the online sellers Medium 15,000,001-
have the mean of 4.41 that corresponds with the 100,000,000
meaning of strongly agree. The results revealed
that MSMEs and online sellers have high According to the data, micro businesses
customer engagement. ranked first and account for 76% of respondents
among MSMEs, and they make an average
According to Bansal (2016), customers can
monthly profit of PHP54,33.68. 14% of the
be engaged both offline and online. However, it
respondents were from small businesses who
was extremely difficult for businesses to
ranked second, and they made an average
implement customer engagement approaches and
monthly profit of PHP1,297,143. The average
track how customers reacted to them. A scale of
monthly profit for the 10% of respondents who
customerengagement was established, and it ws
work in the third ranked medium-sized
discovered that businesses with high levels of
businesses is PHP103,793.
engagement were more successful in attracting
customers.
According to the MSME Sector of the Senate
Table 2. Average Monthly Profit of MSMEs and of the Philippines, in terms of regional
Online Sellers distributions, Region 3 (Central Luzon) with
AVERAGE PERCENTAGE 79,019 establishments. According to the
MONTHLY Philippines Statistics Authority, there were
PROFIT 104,875 micro establishments listed in Central
Luzon. The Level of the Profitability of the MSMEs
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in the Division of Bataan will fall under the It also shows that there is no significant
classification of micro according to the DTI- relationship between customer engagement and
SMEDC & PSA. the profitability of MSMEs and online sellers. The
significance F has the result of 0.849332109 while
Table 3. Test Statistics of Customer Engagement the significance F of online sellers is 0.574391705.
of Profitability of MSMEs and Online Sellers Both are greater than 0.5 which made the null
LEVEL OF INTERPRETATION hypothesis not rejected.
RELATIO- Micro-Level research by Bain and Co. (2023)

NSHIP offered additional proof of the lack of a connection

MSMEs 0.027 Low between customer engagement and profitability.

CONCLUSION AND RECOMMENDATION

ONLINE 0.062 Low
This study's main objective was to
SELLER
ascertain the relationship between the customer
S
engagement and the level of profitability of MSMEs
and online sellers of the Division of Bataan. The
researchers used a self-designed questions to
P DECISI- INTERPRETATION
VALUE gather data about the link between these two in
ON
order to validate the results of the research. From
MSMEs 0.849 Do not There is no
the combined results gathered, it can be
reject significant
concluded that the customer engagement has no
the null relationship
significant relationship with the level of
hypothe between customer
profitability.
sis engagement and
profitability of Given that some business owners were

MSMEs. unavailable or refused to disclose their profits over

ONLINE 0.574 Do not There is no the study's duration, a small sample of carefully
chosen MSMEs and online sellers served as the
SELLER reject significant
study's respondents. Another study that focuses
S the null relationship
on customer engagement and profitability for
hypothe between customer
much larger businesses may be undertaken in
sis. engagement and
light of this.
profitability of
online sellers. It is highly recommended to use a larger
sample, if possible the entire population of
The table above shows that the relationship Bataan's major businesses, to produce a more
between customer engagement and the accurate result. This study might potentially be
profitability of MSMEs and online sellers are low. used as a basis by companies trying to engage

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 “ALPAS”: BATAAN NATIONAL HIGH SCHOOL – SENIOR HIGH SCHOOL RESEARCH JOURNAL
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with customers in order to boost profitability of
the companies of Bataan.
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Praveen Singh (2022). How to Measure Customer
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https://www.google.com/search?q=bain+and+co
mpany&rlz=1CAJCUZ_enPH1041&oq=bain+and+c
o&aqs=chrome.0.0i67i355j46i67i199i465j69i57j0i
20i263i512l2j0i512l5.5321j0j15&sourceid=chrom
e&ie=UTF-8

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Survey Questionnaire 12. I reach new customers.

13. Social media gives our
Listed below are statements about business a positive
customer engagement and profitability. For each image.
one, please indicate whether you are strongly 14. Our customers make
agree, agree, neither agree or disagree, disagree, purchases based on the
content posted on our
or strongly disagree about it.
social media platforms.
15. Our product offerings
5 – Strongly Agree 4 – Agree 3 – Neither
are easily distinguished
Agree or Disagree 2 – Disagree 1 – Strongly because of our social
Disagree media posts.
16. I improved customer
Name of the Company: relationship
_________________________________________________ management.
_______ 17. I enable faster delivery
of information to
Average monthly profit: customers.
_________________________________________________ 18. Customers buy our
______ offerings based on
interaction with us
5 4 3 2 1 within 3 months.
1. In the online business 19. Customers interact with
community, I get to us based on the pop-ads
know other people who seen on social media
are interested in our and conversations
product. created by us.
2. The social aspects of the 20. Customers buy from us
online business based on the product
community are reviews from their social
important to me. media networks.
3. I enjoy communicating
with the customers.
4. Enhance my knowledge
about the customer’s
interest by
communicating with
them.
5. I like to know more
about online business
community.
6. I advertise and promote
my products or services.
7. I conduct marketing
research.
8. I get referrals (word of
mouth via likes, shares,
and followers).
9. I develop customer
relations.
10. I receive customer
feedback on existing
product/services.
11. I communicate with
customers.
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