The Mediation Effect of Customer Satisfaction on the Relationship Between Service Quality and Customer Loyalty
Keywords:
Industrial competition, differentiation strategy, cost leadership strategy, combined strategy, industrial performance, industry, higher education
Abstract
Sustainability of hotel’s performance can be determined by service quality, satisfaction and customer loyalty. The level of customer satisfaction can be increased if hotels offer good quality performance, and so it can retain customers to stay in a hotel. Thus, this research aims to identify and explain the influence of service quality for customer loyalty and test the effect of customer satisfaction mediation for the relationship between service quality and customer loyalty in the room division of the hotel. This research was conducted at hotel industries in Dili. Respondents for this research were their customers, and research instruments were questionnaires adopted from previous researches, and SMART-PLS 3.0 was used to test the hypothesis. This research shows that service quality and customer satisfaction are not significant to influence customer loyalty in the room division of hotels in Dili. Moreover, customer satisfaction does not have the effect of mediation for the relationship between service quality and customer loyalty. This research can contribute to enrich the theory and empirical about service quality, customer satisfaction, and customer loyalty. In a practical level, this research can help hotel managers to develop their strategies in order to retain their customers through good service quality. This research can also help the government to aquire data on the level of customer satisfaction for the service quality of hotels in Timor-Leste, and so can develop the policy of human capital training to improve service quality in hotels and other service industries
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References
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Amegbe, H., Hanu, C. and Mensah, F. (2019) ‘Achieving service quality and students loyalty through intimacy and trust of employees of universities: A test case of Kenyan universities’, International Journal of Educational Management, 33(2), pp. 359–373.
Annamdevula, S. and Bellamkonda, R. S. (2016) ‘Effect of student perceived service quality on student satisfaction, loyalty and motivation in Indian universities: Development of HiEduQual’, Journal of Modelling in Management, 11(2), pp. 488–517.
Arima, S. I., Rahmi, F. and Sari, S. M. (2018) ‘Pengaruh kualitas pelayanan terhadap loyalitas pelanggan jasa penerbangan lion air kota padang’, Perbanas, 4(2), pp. 82–91.
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Boonlertvanich, K. (2019) ‘Service quality, satisfaction, trust, and loyalty: the moderating role of main-bank and wealth status’, International Journal of Bank Marketing, 37(1), pp. 278–302.
Čater, B. and Čater, T. (2009) ‘Relationship-Value-Based Antecedents of Customer Satisfaction and Loyalty in Manufacturing’, Journal of Business and Industrial Marketing, 24(8), pp. 585–597.
Chandra, T. et al. (2019) ‘The influence of service quality, university image on student satisfaction and student loyalty’, Benchmarking:An International Journal, p. 8.
Chien, L. and Chi, S. (2019) ‘Corporate image as a mediator between service quality and customer satisfaction : di ff erence across categorized exhibitors’, (August 2018), p. 24.
Dedeoğlu, B. B. and Demirer, H. (2015) ‘Differences in service quality perceptions of stakeholders in the hotel industry’, International Journal of Contemporary Hospitality Management, 27(1), pp. 130–146.
Dick, A. S. and Basu, K. (1994) ‘Customer loyalty: Toward an integrated conceptual framework’, Journal of the Academy of Marketing Science, 22(2), pp. 99–113.
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Drosos, D. et al. (2019) ‘Measuring industrial customer satisfaction: The case of the natural gas market in Greece’, Sustainability (Switzerland), 11(7), pp. 1–16.
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Gupta, A. et al. (2019) ‘An Empirical Study on Service Quality of Star Hotels: Using Servqual Model’, International Journal of Management Studies, VI(1), p. 6.
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Henseler, J., Ringle, C. M. and Sarstedt, M. (2015) ‘A new criterion for assessing discriminant validity in variance-based structural equation modeling’, Journal of the Academy of Marketing Science, 43(1), pp. 115–135.
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Japarianto, E., Laksmono, P. and Ainy, K. (2007) ‘Pelanggan Hotel Majapahit Surabaya dengan Pemasaran Relasional sebagai variabel Intervening’, p. 9.
Jiang, H. and Zhang, Y. (2016) ‘An investigation of service quality , customer satisfaction and loyalty in China ’ s airline market’, 57, pp. 80–88.
Joudeh, J. M. M. and Dandis, A. O. (2018) ‘Service Quality, Customer Satisfaction and Loyalty in an Internet Service Providers’, International Journal of Business and Management, 13(8), p. 13.
Kandampully, J. and Hu, H.-H. (2007) ‘Do hoteliers need to manage image to retain loyal customers?’, International Journal of Contemporary Hospitality Management, 19(6), pp. 435–443.
Kang, J., Alejandro, T. B. and Groza, M. D. (2015) ‘Customer-company identification and the effectiveness of loyalty programs’, Journal of Business Research, pp. 464–471.
Kaura, V., Prasad, C. S. D. and Sharma, S. (2015) ‘Service quality, service convenience, price and fairness, customer loyalty, and the mediating role of customer satisfaction’, Marketing Intelligence and Planning, 33(4), pp. 404–422.
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Khoo, S., Ha, H. and McGregor, S. L. T. (2017) ‘Service quality and student/customer satisfaction in the private tertiary education sector in Singapore’, International Journal of Educational Management, 31(4), pp. 430–444.
Mbama, C. I. and Ezepue, P. O. (2018) ‘Digital banking, customer experience and bank financial performance: UK customers’ perceptions’, International Journal of Bank Marketing, 36(2), pp. 230–255.
Meesala, A. and Paul, J. (2018) ‘Service quality, consumer satisfaction and loyalty in hospitals: Thinking for the future’, Journal of Retailing and Consumer Services. Elsevier Ltd, 40(November 2016), pp. 261–269.
Mellens, M., DeKimpe, M. and Steenkamp, J. (1996) ‘A review of brand-loyalty measures in marketing’, Tijdschrift voor economie en management, 41(4), pp. 507–533.
Myung Soo Kang (2008) ‘A Study of the Relationship Between Customer Satisfaction and Repurchase Price’, Productivity Review, pp. 75–98.
Nobar, H. B. K. and Rostamzadeh, R. (2018) ‘The Impact of Customer Satisfaction , Customer Experience and Customer Loyalty on Brand Power : Empirical Evidence From Hotel Industry’, Journal of Economics and Management, 19(2), p. 14.
Oliver, R. L. (1995) ‘Attribute need fulfillment in product usage satisfaction’.
Oliver, R. L. and Swan, J. E. (1989) ‘Equity and Disconfirmation Perceptions as Influences on Merchant and Product Satisfaction’, Journal of Consumer Research, p. 372.
Oliver R. L (1980) ‘A Cognitive Model of the Antecedents and Consequences’.
Özkan, P. et al. (2019) ‘The effect of service quality and customer satisfaction on customer loyalty: The mediation of perceived value of services, corporate image, and corporate reputation’, International Journal of Bank Marketing.
Parasuraman, A., Zeithaml, V. A. and Berry, L. L. (1994) ‘Alternative Scales for Measuring Service Quality: A Comparative Assessment Based on Psychometric and Diagnostic Criteria’, Journal of Retailing, 70(3), p. 30.
Quoquab, F., Mohamed Sadom, N. Z. and Mohammad, J. (2019) ‘Driving customer loyalty in the Malaysian fast food industry: The role of halal logo, trust and perceived reputation’, Journal of Islamic Marketing.
Rahman, M. S., Osman-Gani, A. M. and Raman, M. (2017) ‘Destination selection for education tourism: Service quality, destination image and perceived spirituality embedded model’, Journal of Islamic Marketing, 8(3), pp. 373–392.
Rauch, D. A. et al. (2015) ‘Measuring service quality in mid-scale hotels’, International Journal of Contemporary Hospitality Management, 27(1), pp. 87–106.
Saldanha, E. D. S. et al. (2019) Persaingan Industri, Strategi Bisnis, dan Kinerja Industri. Denpasar: Udayana University Press.
Saldanha, E. de S. et al. (2019) ‘Industrial Competition, Hybrid Strategy and Industrial Performance: Study in Higher Education Industry in Timor-Leste’, Journal of Engineering and Applied Sciences, 14(8), pp. 2456–2464.
Singh, J., Ehrenberg, A. and Goodhardt, G. (2008) ‘Measuring customer loyalty to product variants’, International Journal of Market Research, 50(4), pp. 513–532.
Spyridou, A. (2017) ‘Perceived Service Quality and Customer Revisiting Intention: The Case of “all you can eat” Asian Restaurants in Southern Taiwan’, MPRA Paper, (46733), p. 10.
Subrahmanyam, A. (2017) ‘Relationship between service quality, satisfaction, motivation and loyalty: A multi-dimensional perspective’, Quality Assurance in Education, 25(2), pp. 171–188.
Sugiyono (2014) Metode Penelitian Kuantitatif, Kualitatif dan R&D.
Tanford, S. and Jung, S. (2017) ‘Festival attributes and perceptions : A meta-analysis of relationships with satisfaction and loyalty’, 61.
Tongshinen, D. N., Alamai, M. and Chinyere, U. I. (2018) ‘Assesing the Effect of quality Service of Small Hotels on Customers Satisfaction in Bauchi Nigeria’, 23(3), p. 9.
Zeithaml, V. A., Bitner, M. J. and Gremler, D. (2013) ‘Services marketing: integrating customer focus across the firm’, p. 642.
Abdullah, R. Bin et al. (2012) ‘The relationship between store brand and customer loyalty in retailing in Malaysia’, Asian Social Science, 8(2), p. 15.
Akroush, M. N. et al. (2016) ‘Tourism service quality and destination loyalty – the mediating role of destination image from international tourists’ perspectives’, Tourism Review, 71(1), pp. 18–44.
Amegbe, H., Hanu, C. and Mensah, F. (2019) ‘Achieving service quality and students loyalty through intimacy and trust of employees of universities: A test case of Kenyan universities’, International Journal of Educational Management, 33(2), pp. 359–373.
Annamdevula, S. and Bellamkonda, R. S. (2016) ‘Effect of student perceived service quality on student satisfaction, loyalty and motivation in Indian universities: Development of HiEduQual’, Journal of Modelling in Management, 11(2), pp. 488–517.
Arima, S. I., Rahmi, F. and Sari, S. M. (2018) ‘Pengaruh kualitas pelayanan terhadap loyalitas pelanggan jasa penerbangan lion air kota padang’, Perbanas, 4(2), pp. 82–91.
Berry, L. L., Parasuraman, A. and Zeithaml, V. A. (1988) ‘SERVQUAL: A multiple-item scale for measuring consumer perceptions of service quality’, Journal of retailing, pp. 12–40.
Boonlertvanich, K. (2019) ‘Service quality, satisfaction, trust, and loyalty: the moderating role of main-bank and wealth status’, International Journal of Bank Marketing, 37(1), pp. 278–302.
Čater, B. and Čater, T. (2009) ‘Relationship-Value-Based Antecedents of Customer Satisfaction and Loyalty in Manufacturing’, Journal of Business and Industrial Marketing, 24(8), pp. 585–597.
Chandra, T. et al. (2019) ‘The influence of service quality, university image on student satisfaction and student loyalty’, Benchmarking:An International Journal, p. 8.
Chien, L. and Chi, S. (2019) ‘Corporate image as a mediator between service quality and customer satisfaction : di ff erence across categorized exhibitors’, (August 2018), p. 24.
Dedeoğlu, B. B. and Demirer, H. (2015) ‘Differences in service quality perceptions of stakeholders in the hotel industry’, International Journal of Contemporary Hospitality Management, 27(1), pp. 130–146.
Dick, A. S. and Basu, K. (1994) ‘Customer loyalty: Toward an integrated conceptual framework’, Journal of the Academy of Marketing Science, 22(2), pp. 99–113.
Dominici, G. and Guzzo, R. (2010) ‘Customer Satisfaction in the Hotel Industry: A Case Study from Sicily’, International Journal of Marketing Studies, 2(2), pp. 2–12.
Drosos, D. et al. (2019) ‘Measuring industrial customer satisfaction: The case of the natural gas market in Greece’, Sustainability (Switzerland), 11(7), pp. 1–16.
Durga Ranabhat (2018) Customer Loyalty in Business, Centria University of Applied Science.
Famiyeh, S., Kwarteng, A. and Asante-Darko, D. (2018) ‘Service quality, customer satisfaction and loyalty in automobile maintenance services: Evidence from a developing country’, Journal of Quality in Maintenance Engineering, 24(3), pp. 262–279.
Fraering, M. and Minor, M. S. (2013) ‘Beyond loyalty: Customer satisfaction, loyalty, and fortitude’, Journal of Services Marketing, 27(4), p. 11.
Gupta, A. et al. (2019) ‘An Empirical Study on Service Quality of Star Hotels: Using Servqual Model’, International Journal of Management Studies, VI(1), p. 6.
Hair, J. et al. (2017) ‘An updated and expanded assessment of PLS-SEM in information systems research’, Industrial Management & Data Systems, 117(3), pp. 442–458.
Hair, Joe F. et al. (2014) ‘Partial least squares structural equation modeling (PLS-SEM)’, European Business Review, 26(2), pp. 106–121.
Hair, Joseph F. et al. (2014) Partial Least Squares Structural Equation Modeling (Pls-Sem). London: SAGE Publication LTD.
Henseler, J., Ringle, C. M. and Sarstedt, M. (2015) ‘A new criterion for assessing discriminant validity in variance-based structural equation modeling’, Journal of the Academy of Marketing Science, 43(1), pp. 115–135.
Ishak, F. and Ghani, N. H. A. (2010) ‘A Review of the Literature on Brand Loyalty and Customer Loyalty’, Conference on Business Management Research 2013, p. 13. Available at: http://repo.uum.edu.my/16316/.
Izogo, E. E. (2017) ‘Customer loyalty in telecom service sector: the role of service quality and customer commitment’, The TQM Journal, 29(1), pp. 19–36.
Japarianto, E., Laksmono, P. and Ainy, K. (2007) ‘Pelanggan Hotel Majapahit Surabaya dengan Pemasaran Relasional sebagai variabel Intervening’, p. 9.
Jiang, H. and Zhang, Y. (2016) ‘An investigation of service quality , customer satisfaction and loyalty in China ’ s airline market’, 57, pp. 80–88.
Joudeh, J. M. M. and Dandis, A. O. (2018) ‘Service Quality, Customer Satisfaction and Loyalty in an Internet Service Providers’, International Journal of Business and Management, 13(8), p. 13.
Kandampully, J. and Hu, H.-H. (2007) ‘Do hoteliers need to manage image to retain loyal customers?’, International Journal of Contemporary Hospitality Management, 19(6), pp. 435–443.
Kang, J., Alejandro, T. B. and Groza, M. D. (2015) ‘Customer-company identification and the effectiveness of loyalty programs’, Journal of Business Research, pp. 464–471.
Kaura, V., Prasad, C. S. D. and Sharma, S. (2015) ‘Service quality, service convenience, price and fairness, customer loyalty, and the mediating role of customer satisfaction’, Marketing Intelligence and Planning, 33(4), pp. 404–422.
Khadka, K. and Maharjan, S. (2017) Value, satisfaction and customer loyalty, Marketing for Entrepreneurs and SMEs.
Khan, I. (2012) ‘Impact of customer satisfaction and retention on customer loyalty’, International Journal of Scientific & Technology Research, 1(2), p. 5.
Khoo, S., Ha, H. and McGregor, S. L. T. (2017) ‘Service quality and student/customer satisfaction in the private tertiary education sector in Singapore’, International Journal of Educational Management, 31(4), pp. 430–444.
Mbama, C. I. and Ezepue, P. O. (2018) ‘Digital banking, customer experience and bank financial performance: UK customers’ perceptions’, International Journal of Bank Marketing, 36(2), pp. 230–255.
Meesala, A. and Paul, J. (2018) ‘Service quality, consumer satisfaction and loyalty in hospitals: Thinking for the future’, Journal of Retailing and Consumer Services. Elsevier Ltd, 40(November 2016), pp. 261–269.
Mellens, M., DeKimpe, M. and Steenkamp, J. (1996) ‘A review of brand-loyalty measures in marketing’, Tijdschrift voor economie en management, 41(4), pp. 507–533.
Myung Soo Kang (2008) ‘A Study of the Relationship Between Customer Satisfaction and Repurchase Price’, Productivity Review, pp. 75–98.
Nobar, H. B. K. and Rostamzadeh, R. (2018) ‘The Impact of Customer Satisfaction , Customer Experience and Customer Loyalty on Brand Power : Empirical Evidence From Hotel Industry’, Journal of Economics and Management, 19(2), p. 14.
Oliver, R. L. (1995) ‘Attribute need fulfillment in product usage satisfaction’.
Oliver, R. L. and Swan, J. E. (1989) ‘Equity and Disconfirmation Perceptions as Influences on Merchant and Product Satisfaction’, Journal of Consumer Research, p. 372.
Oliver R. L (1980) ‘A Cognitive Model of the Antecedents and Consequences’.
Özkan, P. et al. (2019) ‘The effect of service quality and customer satisfaction on customer loyalty: The mediation of perceived value of services, corporate image, and corporate reputation’, International Journal of Bank Marketing.
Parasuraman, A., Zeithaml, V. A. and Berry, L. L. (1994) ‘Alternative Scales for Measuring Service Quality: A Comparative Assessment Based on Psychometric and Diagnostic Criteria’, Journal of Retailing, 70(3), p. 30.
Quoquab, F., Mohamed Sadom, N. Z. and Mohammad, J. (2019) ‘Driving customer loyalty in the Malaysian fast food industry: The role of halal logo, trust and perceived reputation’, Journal of Islamic Marketing.
Rahman, M. S., Osman-Gani, A. M. and Raman, M. (2017) ‘Destination selection for education tourism: Service quality, destination image and perceived spirituality embedded model’, Journal of Islamic Marketing, 8(3), pp. 373–392.
Rauch, D. A. et al. (2015) ‘Measuring service quality in mid-scale hotels’, International Journal of Contemporary Hospitality Management, 27(1), pp. 87–106.
Saldanha, E. D. S. et al. (2019) Persaingan Industri, Strategi Bisnis, dan Kinerja Industri. Denpasar: Udayana University Press.
Saldanha, E. de S. et al. (2019) ‘Industrial Competition, Hybrid Strategy and Industrial Performance: Study in Higher Education Industry in Timor-Leste’, Journal of Engineering and Applied Sciences, 14(8), pp. 2456–2464.
Singh, J., Ehrenberg, A. and Goodhardt, G. (2008) ‘Measuring customer loyalty to product variants’, International Journal of Market Research, 50(4), pp. 513–532.
Spyridou, A. (2017) ‘Perceived Service Quality and Customer Revisiting Intention: The Case of “all you can eat” Asian Restaurants in Southern Taiwan’, MPRA Paper, (46733), p. 10.
Subrahmanyam, A. (2017) ‘Relationship between service quality, satisfaction, motivation and loyalty: A multi-dimensional perspective’, Quality Assurance in Education, 25(2), pp. 171–188.
Sugiyono (2014) Metode Penelitian Kuantitatif, Kualitatif dan R&D.
Tanford, S. and Jung, S. (2017) ‘Festival attributes and perceptions : A meta-analysis of relationships with satisfaction and loyalty’, 61.
Tongshinen, D. N., Alamai, M. and Chinyere, U. I. (2018) ‘Assesing the Effect of quality Service of Small Hotels on Customers Satisfaction in Bauchi Nigeria’, 23(3), p. 9.
Zeithaml, V. A., Bitner, M. J. and Gremler, D. (2013) ‘Services marketing: integrating customer focus across the firm’, p. 642.
Published
2020-09-30
How to Cite
Flores, A., Saldanha, E. and Vong, M. (2020) “The Mediation Effect of Customer Satisfaction on the Relationship Between Service Quality and Customer Loyalty”, Timor Leste Journal of Business and Management, 2(2), pp. 56-65. doi: 10.51703/bm.v2i2.22.
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Articles
Copyright (c) 2020 Timor Leste Journal of Business and Management
This work is licensed under a Creative Commons Attribution 4.0 International License.
