Analysis of Service Quality and Customer Satisfaction, and Its Influence on Customer Loyalty.

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ANALYSIS OF SERVICE QUALITY AND CUSTOMER SATISFACTION, AND ITS INFLUENCE ON CUSTOMER LOYALTY.

(Passengers Survey of Domestic Full Service Airlines Company “Garuda Indonesia” in Indonesia)

Mohamad Rizan
Management Department of Economics Faculty, State University of Jakarta, Indonesia dr_rizan@yahoo.com

ABSTRACT

The aims of research are : 1) Analyzing service quality, customer satisfaction and loyalty of full service airlines company (Garuda Indonesia) in Indonesia, and 2) Testing hypothesis on the influence service quality and customer satisfaction on customer loyalty of full service airlines company in Indonesia. Unit of observation are 160 passengers of ten profitable domestic routes of full service airlines company (Garuda Indonesia) in Indonesia, such as; Jakarta-Surabaya, Jakarta-Makassar, Jakarta-Denpasar, Jakarta-Medan, Jakarta-Yogyakarta, Jakarta-Manado, Jakarta-Padang, Jakarta-Pekanbaru, Palembang, and Jakarta-Banjarmasin. Design of research is ex post facto (non-experimental), type of research are descriptive and explanatory survey, sampling technique is convenience sampling, and method of analysis is structural equation modeling (SEM). The results of descriptive research are : 1) service quality performance of full service airlines (Garuda Indonesia) is 88.76 % (consists of; reliability is 88.07 %, responsiveness is 86.76 %, assurance 87.39 %, emphaty is 90.52 %, tangible is 91.05 %); 2) customer satisfaction performance of full service airlines (Garuda Indonesia) is 80.15% (consists of; service quality 86.76 %, product quality is 81.37 %, price is 85.05 %, personal factor is 67.97 %, situational factor is 79.58 %); 3) customer loyalty performance of full service airlines (Garuda Indonesia) is 85.46 % (consists of; cognitive loyalty is 89.95 %, affective loyalty is 89.46 %, conative loyalty is 82.35 %, action loyalty is 80.07 %). The results of explanatory research are; 1) Simultaneously, service quality and customer satisfaction influence significantly on customer loyalty (R² = 0,8115%); 2) Partially, service quality influences significantly on customer loyalty (R² = 0,0729), and customer satisfaction influences significantly on customer loyalty (R² = 0,5183). According to hypothesis testing indicate that the influence of service quality on customer loyalty is lower than customer loyalty on customer loyalty. Based on descriptive and explanatory research finding indicate that full service airlines company (Garuda Indonesia) is excellence performance. Researcher recommend some suggestion, such as; 1) full service airlines company (Garuda Indonesia) must be recondition of old aircraft (B737-300, B737-400, and B737-500) as anticipating strategy of low cost expanded domestic market share (Lion Air), and implementation of open sky policy in Indonesia; 2) improving sustained competitive advantage by recondition of old wide body aircraft as preparing of international routes expansion.

Key words : service quality, customer satisfaction, customer loyalty, domestic passenger, full service airlines, open sky policy.

INTRODUCTION
James Dicky Dannie Massie’s research (1998, p.240) shows that the services offered by the five domestic airlines (Garuda Indonesia, Merpati Airlines, Mandala Airlines, Bouraq Airlines and Sempati Air) is not capable of creating satisfaction of domestic passengers. Various complaints experienced by domestic or foreign passengers when using the service airline of Indonesia, for example; low on time performance, service delievery is not responsive, the plane that is used frequently damaged, unsatisfactory service, cabin crew who are not friendly, kind of food less varied and loss of baggage handling is inadequate. Diah Natalisa (2000: 177-178) found that 64.8% of the domestic airline customers are not satisfied with the services received. Only 35.2% of all domestic airline customers who were satisfied with the services provided. Customer...
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