Service Quality and Its Impact on Customer Satisfaction and Loyalty in Airline Industry: Partial Least Square (PLS)-Structural Equation Modelling (SEM) Approach.

Authors

  • JAVED ALI
  • AHMAD JUSOH
  • ABUL QASIM
  • MUHAMMAD AZEEM ABRO

Keywords:

Service Quality, Customer Satisfaction, Customer Loyalty, PLS-SEM, Airline Industry, AIRQUAL

Abstract

This quantitative paper aims to measure the service quality of airline service perceived by Pakistani customers, and its impact on customer satisfaction and loyalty. Partial Least Square Structural - Equation Modelling (PLS-SEM) was used to measure the relationship. It used a self-administered questionnaire by incorporating AIRQUAL measurement model. Respondents (n=168) who have travelled from Pakistan to Malaysia were sent questionnaire through social media. Convenience sampling technique was used, and the results revealed that Airline Tangibles, Personnel Services, and Image have a positive and significant relationship with Customer Satisfaction whereas Empathy and Terminal Tangibles showed an insignificant relationship with Customer Satisfaction. Results also showed a strong positive relationship between Customer Satisfaction and Customer Loyalty. Moreover, the management of airlines and airport services need to reconsider the services they provide to their customers who are travelling from Pakistan to Malaysia.

Downloads

Download data is not yet available.

References

Aagja, J. P., & Garg, R. (2010). Measuring perceived service quality for public hospitals (PubHosQual) in the Indian context. International Journal of Pharmaceutical and Healthcare Marketing, 4(1), 60–83.

Abu-El Samen, A. A., Akroush, M. N., & Abu-Lail, B. N. (2013). Mobile SERVQUAL: A comparative analysis of customers’ and managers’ perceptions. International Journal of Quality & Reliability Management, 30(4), 403–425.

Ahmed, M., & Nawaz, N. (2015). Impact of organizational commitment on employee turnover: A case study of Pakistan International Airlines (PIA). Industrial Engineering Letters Journal, 5(8).

Alegre, J., & Cladera, M. (2009). Analysing the effect of satisfaction and previous visits on tourist intentions to return. European Journal of Marketing, 43(5/6), 670–685.

Alexandris, K., Dimitriadis, N., & Markata, D. (2002). Can perceptions of service quality predict behavioral intentions? An exploratory study in the hotel sector in Greece. Managing Service Quality: An International Journal, 12(4), 224–231.

Andaleeb, S. S. (2001). Service quality perceptions and patient satisfaction: a study of hospitals in a developing country. Social Science & Medicine, 52(9), 1359–1370.

Andreassen, T. W., & Lindestad, B. (1998). The effect of corporate image in the formation of customer loyalty. Journal of Service Research, 1(1), 82–92.

Archana, R., & Subha, M. V. (2012). A study on service quality and passenger satisfaction on Indian airlines. International Journal of Multidisciplinary Research, 2(2), 50–63.

Ariffin, A. A. M., & Yahaya, M. F. (2013). The relationship between airport image, national identity and passengers delight: A case study of the Malaysian low cost carrier terminal (LCCT). Journal of Air Transport Management, 31, 33–36.

Berezina, K., Cobanoglu, C., Miller, B. L., & Kwansa, F. A. (2012). The impact of information security breach on hotel guest perception of service quality, satisfaction, revisit intentions and word-of-mouth. International Journal of Contemporary Hospitality Management, 24(7), 991–1010.

Bitner, M. J. (1990). Evaluating service encounters: the effects of physical surroundings and employee responses. Journal of Marketing, 54(2), 69–82.

Boetsch, T., Bieger, T., & Wittmer, A. (2011). A Customer-Value Framework for Analyzing Airline Services. Transportation Journal, 50(3), 251–270. https://doi.org/10.5325/transportationj.50.3.0251

Bolton, R. N., & Drew, J. H. (1991). A multistage model of customers’ assessments of service quality and value. Journal of Consumer Research, 17(4), 375–384.

Chang, Y.-H., & Yeh, C.-H. (2002). A survey analysis of service quality for domestic airlines. European Journal of Operational Research, 139(1), 166–177.

Chen, L., Li, Y. Q., & Liu, C. H. (2019). How airline service quality determines the quantity of repurchase intention - Mediate and moderate effects of brand quality and perceived value. Journal of Air Transport Management, 75(November), 185–197. https://doi.org/10.1016/j.jairtraman.2018.11.002

Chen, R.-F., Hsiao, J.-L., & Hwang, H.-G. (2012). Measuring customer satisfaction of Internet banking in Taiwan: scale development and validation. Total Quality Management & Business Excellence, 23(7–8), 749–767.

Chin, W. W. (1998). The partial least squares approach to structural equation modeling. Modern Methods for Business Research, 295(2), 295–336.

Chin, W. W. (2010). How to write up and report PLS analyses. In Handbook of partial least squares (pp. 655–690). Springer.

Chow, C. K. W. (2014). Customer satisfaction and service quality in the Chinese airline industry. Journal of Air Transport Management, 35, 102–107.

Cohen, M. A. (1988). Some new evidence on the seriousness of crime. Criminology, 26(2), 343–353.

Cretu, A. E., & Brodie, R. J. (2007). The influence of brand image and company reputation where manufacturers market to small firms: A customer value perspective. Industrial Marketing Management, 36(2), 230–240.

Cronin Jr, J. J., Brady, M. K., & Hult, G. T. M. (2000). Assessing the effects of quality, value, and customer satisfaction on consumer behavioral intentions in service environments. Journal of Retailing, 76(2), 193– 218.

Cronin Jr, J. J., & Taylor, S. A. (1992). Measuring service quality: a reexamination and extension. Journal of Marketing, 56(3), 55–68.

Cronin Jr, J. J., & Taylor, S. A. (1994). SERVPERF versus SERVQUAL: reconciling performance-based and perceptions-minus-expectations measurement of service quality. Journal of Marketing, 58(1), 125–131.

dan Theingi, S. G. C. (2009). Service quality, satisfaction, and behavioural intentions. Managing Service Quality: An International Journal, 19(3), 350–372.

Djajanto, L., Nimran, U., & Kumadji, S. (n.d.). Kertahadi. 2014. The effect of self-service technology, service quality, and relationship marketing on customer satisfaction and loyalty. IOSR Journal of Business and Management, 16(1), 39–50.

Ennew, C. T., & Binks, M. R. (1996). The Impact of Service Quality and Service Characteristics on Customer Retention: Small Businesses and their Banks in the UK 1. British Journal of Management, 7(3), 219–230.

Faizan, A. (2015). An assessment of service quality and resulting customer satisfaction in Pakistan International Airlines. International Journal of Quality & Reliability Management, 32(5), 486–502. https://doi.org/10.1108/IJQRM-07-2013-0110

Farooq, M S, Aslam, H. A., Khan, R. A., & Gillani, F. (2009). Process definition clarity affecting quality of healthcare services in public sector hospitals. The Second Canadian Quality Congress, Canada.

Farooq, M S, & Radovic-Markovic, M. (2016). Modeling entrepreneurial education and entrepreneurial skills as antecedents of intention towards entrepreneurial behaviour in single mothers: a PLS-SEM approach. Entrepreneurship: Types, Current Trends and Future Perspectives, Presented at the Fifth International Conference “Employment, Education and Entrepreneurship”(EEE 2016), Faculty of Business Economics and Entrepreneurship, University of Belgrade, Belgrade, 198–216.

Farooq, Muhammad Shoaib, Salam, M., Fayolle, A., Jaafar, N., & Ayupp, K. (2018). Impact of service quality on customer satisfaction in Malaysia airlines: A PLS-SEM approach. Journal of Air Transport Management, 67(September 2017), 169–180. https://doi.org/10.1016/j.jairtraman.2017.12.008

Farooq, Muhammad Shoaib, Salam, M., Jaafar, N., Fayolle, A., Ayupp, K., Radovic-Markovic, M., & Sajid, A. (2017). Acceptance and use of lecture capture system (LCS) in executive business studies: Extending UTAUT2. Interactive Technology and Smart Education, 14(4), 329–348.

Gourdin, K. N. (1988). Bringing quality back to commercial air travel. Transportation Journal, 23–29.

Graham Saunders, S. (2008). Measuring and applying the PAKSERV service quality construct: Evidence from a South African cultural context. Managing Service Quality: An International Journal, 18(5), 442–456.

Gudmundsson, S. V. (1998). New-entrant airlines’ life-cycle analysis: growth, decline and collapse. Journal of Air Transport Management, 4(4), 217–228.

Gudmundsson, S. V., de Boer, E. R., & Lechner, C. (2002). Integrating frequent flyer programs in multilateral airline alliances. Journal of Air Transport Management, 8(6), 409–417.

Gudmundsson, S. V., & Lechner, C. (2006). Multilateral airline alliances: Balancing strategic constraints and opportunities. Journal of Air Transport Management, 12(3), 153–158.

Gupta, T. K., & Singh, V. (2017). Measurement of service quality of automobile organisation by artificial neural network. International Journal of Management Concepts and Philosophy, 10(1), 32–53.

Gustafsson, M., Biel, A., & Garling, T. (1999). Outcome-desirability bias in resource management problems. Thinking & Reasoning, 5(4), 327–337.

Hair Jr, J. F., Sarstedt, M., Ringle, C. M., & Gudergan, S. P. (2017). Advanced issues in partial least squares structural equation modeling. Sage Publications.

Han, X., Kwortnik Jr, R. J., & Wang, C. (2008). Service loyalty: An integrative model and examination across service contexts. Journal of Service Research, 11(1), 22–42.

Harman, H. H. (1976). Modern factor analysis. University of Chicago press.

Henseler, J., Hubona, G., & Ray, P. A. (2016). Using PLS path modeling in new technology research: updated guidelines. Industrial Management & Data Systems, 116(1), 2–20.

Henseler, J., Ringle, C. M., & 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), 115– 135.

Henseler, J., Ringle, C. M., & Sinkovics, R. R. (2009). The use of partial least squares path modeling in international marketing. In New challenges to international marketing (pp. 277–319). Emerald Group Publishing Limited.

Hu, H.-Y., Cheng, C.-C., Chiu, S.-I., & Hong, F.-Y. (2011). A study of customer satisfaction, customer loyalty and quality attributes in Taiwans medical service industry. African Journal of Business Management, 5(1), 187–195.

Humphrey, R. H. (2013). The benefits of emotional intelligence and empathy to entrepreneurship. Entrepreneurship Research Journal, 3(3), 287–294.

Hussain, K., & Ekiz, H. E. (2007). Perceptions of service quality in North Cyprus National Airline: a path analysis approach. Estudios y Perspectivas En Turismo.

Izogo, E. E., & Ogba, I.-E. (2015). Service quality, customer satisfaction and loyalty in automobile repair services sector. International Journal of Quality & Reliability Management, 32(3), 250–269.

Jiang, H., & Zhang, Y. (2016). An assessment of passenger experience at Melbourne Airport. Journal of Air Transport Management, 54, 88–92.

Koo, T. T. R., Lim, C., & Dobruszkes, F. (2017). Annals of Tourism Research Causality in direct air services and tourism demand. Annals of Tourism Research, 67(May), 67–77. https://doi.org/10.1016/j.annals.2017.08.004

Kotler, P., & Caslione, J. A. (2009). How marketers can respond to recession and turbulence. Journal of Customer Behaviour, 8(2), 187–191.

Lee, W.-I., Chen, C.-W., Chen, T.-H., & Chen, C.-Y. (2010). The relationship between consumer orientation, service value, medical care service quality and patient satisfaction: The case of a medical center in Southern Taiwan. African Journal of Business Management, 4(4), 448–458.

Levesque, T. J., & McDougall, G. H. G. (2000). Service problems and recovery strategies: an experiment. Canadian Journal of Administrative Sciences/Revue Canadienne Des Sciences de l’Administration, 17(1), 20–37.

Mat Zaid, A. (1995). Measuring and monitoring service quality at Malaysia Airlines. Managing Service Quality: An International Journal, 5(2), 25–27.

McDougall, G. H. G., & Levesque, T. (2000). Customer satisfaction with services: putting perceived value into the equation. Journal of Services Marketing, 14(5), 392–410.

Meesala, A., & Paul, J. (2018). Service quality, consumer satisfaction and loyalty in hospitals: Thinking for the future. Journal of Retailing and Consumer Services, 40(November 2016), 261–269. https://doi.org/10.1016/j.jretconser.2016.10.011

Muturi, D., Sagwe, J., & Namukasa, J. (2013). The influence of airline service quality on passenger satisfaction and loyalty. The TQM Journal.

Nadiri, H., Hussain, K., Haktan Ekiz, E., & Erdoğan, Ş. (2008). An investigation on the factors influencing passengers’ loyalty in the North Cyprus national airline. The TQM Journal, 20(3), 265–280.

Nawaz, N., Jahanian, A., & Tehreem, S. (2012). Determinants of employee retention in Pakistan International Airlines (PIA). European Journal of Business and Management, 4(7), 2012.

Oliver, R. L. (1980). A Cognitive Model of the Antecedents and Consequences of Satisfaction Decisions. Journal of Marketing Research, 17(4), 460–469. https://doi.org/10.1177/002224378001700405

Ong, W. L., & Tan, A. K. G. (2010). A note on the determinants of airline choice: The case of Air Asia and Malaysia Airlines. Journal of Air Transport Management, 16(4), 209–212.

Ostrowski, P. L., O’Brien, T. V, & Gordon, G. L. (1993). Service quality and customer loyalty in the commercial airline industry. Journal of Travel Research, 32(2), 16–24.

Parasuraman, Ananthanarayanan, Zeithaml, V. A., & Berry, L. L. (1988). Servqual: A multiple-item scale for measuring consumer perc. Journal of Retailing, 64(1), 12.

Parasuraman, Anantharanthan, Zeithaml, V. A., & Berry, L. L. (1985). A conceptual model of service quality and its implications for future research. Journal of Marketing, 49(4), 41–50.

Park, J. W., Robertson, R., & Wu, C.-L. (2005). Investigating the effects of airline service quality on airline image and passengers’ future behavioural intentions: findings from Australian international air passengers. Journal of Tourism Studies, 16(1), 2.

Podsakoff, P. M., MacKenzie, S. B., Lee, J.-Y., & Podsakoff, N. P. (2003). Common method biases in behavioral research: A critical review of the literature and recommended remedies. Journal of Applied Psychology, 88(5), 879.

Prentice, C., & Kadan, M. (2019). The role of airport service quality in airport and destination choice. Journal of Retailing and Consumer Services, 47(October 2018), 40–48. https://doi.org/10.1016/j.jretconser.2018.10.006

Psychogios, A. G., Atanasovski, J., & Tsironis, L. K. (2012). Lean Six Sigma in a service context: A multi-factor application approach in the telecommunications industry. International Journal of Quality & Reliability Management, 29(1), 122–139.

Qin, H., Prybutok, V. R., & Zhao, Q. (2010). Perceived service quality in fast-food restaurants: empirical evidence from China. International Journal of Quality & Reliability Management, 27(4), 424–437.

Radović-Marković, M., Shoaib Farooq, M., & Marković, D. (2017). Strengthening the resilience of small and medium-sized enterprises. Review of Applied Socio-Economic Research, 345–356.

Ringle, C. M., & Sarstedt, M. (2016). Gain more insight from your PLS-SEM results: The importance- performance map analysis. Industrial Management & Data Systems, 116(9), 1865–1886.

Robledo, M. A. (2001). Measuring and managing service quality: integrating customer expectations. Managing Service Quality: An International Journal, 11(1), 22–31.

Rust, R. T., Zahorik, A. J., & Keiningham, T. L. (1995). Return on quality (ROQ): Making service quality financially accountable. Journal of Marketing, 59(2), 58–70.

Shabbir, A., Malik, S. A., & Malik, S. A. (2016). Measuring patients’ healthcare service quality perceptions, satisfaction, and loyalty in public and private sector hospitals in Pakistan. International Journal of Quality & Reliability Management, 33(5), 538–557.

Shi, Y., Prentice, C., & He, W. (2014). Linking service quality, customer satisfaction and loyalty in casinos, does membership matter? International Journal of Hospitality Management, 40, 81–91.

Smith, A. E., & Swinehart, K. D. (2001). Integrated systems design for customer focused health care performance measurement: a strategic service unit approach. International Journal of Health Care Quality Assurance, 14(1), 21–29.

Tenenhaus, M., Vinzi, V. E., Chatelin, Y.-M., & Lauro, C. (2005). PLS path modeling. Computational Statistics & Data Analysis, 48(1), 159–205.

Trischler, J., & Lohmann, G. (2018). Monitoring quality of service at Australian airports: A critical analysis. Journal of Air Transport Management, 67, 63–71.

Truitt, L. J., & Haynes, R. (1994). Evaluating service quality and productivity in the regional airline industry. Transportation Journal, 21–32.

Tsoukatos, E., & Mastrojianni, E. (2010). Key determinants of service quality in retail banking. EuroMed Journal of Business, 5(1), 85–100.

Wang, X., Zhu, Y., Sun, H., & Jia, F. (2018). Production decisions of new and remanufactured products : Implications for low carbon emission economy. Journal of Cleaner Production, 171, 1225–1243. https://doi.org/10.1016/j.jclepro.2017.10.053

Westbrook, R. A., & Oliver, R. L. (1991). The dimensionality of consumption emotion patterns and consumer satisfaction. Journal of Consumer Research, 18(1), 84–91.

Wetzels, M., Odekerken-Schröder, G., & Van Oppen, C. (2009). Using PLS path modeling for assessing hierarchical construct models: Guidelines and empirical illustration. MIS Quarterly, 177–195.

Woodside, A. G., Frey, L. L., & Daly, R. T. (1989). Linking sort/ice anlity, customer satisfaction, and behavioral intention. Journal of Health Care Marketing, 9(4), 5–17.

Wu, H.-C., & Cheng, C.-C. (2013). A hierarchical model of service quality in the airline industry. Journal of Hospitality and Tourism Management, 20, 13–22.

Wu, H.-C., & Ko, Y. J. (2013). Assessment of service quality in the hotel industry. Journal of Quality Assurance in Hospitality & Tourism, 14(3), 218–244.

Žabkar, V., Brenčič, M. M., & Dmitrović, T. (2010). Modelling perceived quality, visitor satisfaction and behavioural intentions at the destination level. Tourism Management, 31(4), 537–546.

Zeithaml, Valarie A, Berry, L. L., & Parasuraman, A. (1996). The behavioral consequences of service quality. Journal of Marketing, 60(2), 31–46.

Zeithaml, Valerie A, Bitner, M. J., & Gremler, D. D. (1996). Services Marketing McGraw Hill. New York.

Downloads

Published

2021-06-30

How to Cite

ALI, J. ., JUSOH, A. ., QASIM, A. ., & ABRO, M. A. . (2021). Service Quality and Its Impact on Customer Satisfaction and Loyalty in Airline Industry: Partial Least Square (PLS)-Structural Equation Modelling (SEM) Approach. The Journal of Contemporary Issues in Business and Government, 27(3), 2212–2224. Retrieved from https://cibgp.com/au/index.php/1323-6903/article/view/1831