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Relationships & Impacts of

Service quality, perceived value,

customer satisfaction, and image

An Empirical Study

Presenter: Sharon Chang Instructor: Dr. Pi-Ying Hsu Date: May 20, 2013

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Citation

Hu, H.-H., Kandampully, J., Juwaheer, T. D. (2009). Relationships and impacts of service quality, perceived value, customer satisfaction, and image: An empirical study. The Service Industries Journal, 29(2), 111-125.

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IntroductionLiterature ReviewMethodologyResult & ConclusionReflection

Introduction

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Introduction

Background

Given the global nature of the market, competing firms are constantly seeking to project their firms’ superior quality of service, customer-perceived value, and image in order to gain customer loyalty.

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Introduction

PurposeThis empirical study seeks to understand the relationships that exist between service quality and perceived value and how they impact customer satisfaction, corporate image, and behavioural intentions.

Literature Review

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H1: Perceived quality has positive impacts on behavioural intentions.

Literature Review

The positive relationships between service quality and repurchase intentions and willingness to recommend.

(Boulding & Karla & Staelin & Zeithaml, 1993)

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Literature Review

Service quality is an important driver of perceived customer value.

(Cronin et al., 2000; Parasuraman & Grewal, 2000)

H2: Service quality has positive impacts on perceived value.

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Literature Review

Perceived value contributes directly to customer satisfaction which, in turn, leads to future intentions.

(McDougall & Levesque, 2000)

H3: Perceived value has positive impacts on behavioural intentions.

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Customer satisfaction is a post-consumption experience which compares perceived quality with expected quality, whereas service quality refers to a global evaluation of a firm’s service delivery system.

(Anderson & Fornell, 1994)

H4: Service quality has positive impacts on customer satisfaction.

Literature Review

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Literature Review

Service quality and satisfaction are distinct constructs, and there is a causal relationship between the two, and that perceptions of service quality affect feelings of satisfaction which, in turn, influence future purchase behaviour.

(Hurley & Estelami, 1998)

H5: Perceived value has positive impacts on customer satisfaction.

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Literature Review

Corporate image is built mainly by technical quality what the customer receives from the service experience, and functional quality: the manner in which the service is delivered.

(CrÖnroos, 1984)

H6: Service quality has positive impacts on corporate image.

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Literature Review

A company will have a strong image if customers believe that they are getting high value when they buy from it.

(Barich and Lotler, 1991)

H7: Perceived value has positive impacts on corporate image.

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Literature Review

H8: Customer satisfaction has positive impacts on corporate image.

Satisfaction levels derived from each service encounter are viewed as having an effect on image assessments.

(Nguyen & LeBlanc, 1998)

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Literature Review

Corporate image serves as an important factor influencing customer loyalty, and a favourable image can influence repeat patronage.

(Andreassen & Lindestad, 1998; Dick & Basu, 1994)

H9: Corporate image has positive impacts on behavioural intentions.

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Literature Review

Zeithaml et al. (1996)

H1

H2

H3

H4

H5

H6

H7

H8 H9

- Conceptual model -

Methodology

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Methodology

SampleThree

categories•Namely luxury (26%)•Mid-scale (64%)•Economy hotels (10%)

Location

•

Participants

•1500 participants

Bilingual country (French & English)

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Methodology

1 2 3 4 5 6 7

Completely disagree Disagree Disagree

somewhat Undecided Agree somewhat Agree Completely

agree

- Instrument -Service quality –

Multiple-item scale of SERVQUAL from Parasuraman et al. (1988)

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Methodology

Perceived value –

Three items were adapted from Cronin et al. (2000)

1 2 3 4 5 6 7

Strongly disagree Disagree Disagree

somewhat Undecided Agree somewhat Agree Strongly

agree

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Methodology

Customer satisfaction - 1 2 3 4 5 6 7

Very dissatisfied Dissatisfied Dissatisfied

somewhat Undecided Satisfied somewhat Satisfied Very

satisfied

Corporate image - Two dimensions: image attributes and image holistic

1 2 3 4 5 6 7

Strongly disagree Disagree Disagree

somewhat Undecided Agree somewhat Agree Strongly

agree

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Methodology

1 2 3 4 5 6 7

Not all likely

Not likely

Not likely somewhat Undecided likely

somewhat likely Extremely likely

Behavioural intentions –

Three categories: repurchase intentions, willingness to recommend, and price sensitivity.

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Methodology

Pilot study-Establish content

validity of the questionnaire

Pilot study-Establish content

validity of the questionnaire

Collect the data- During a 6-week

period

Collect the data- During a 6-week

period

Analyze the data-Cronbach’s alphaLISREL 8

Analyze the data-Cronbach’s alphaLISREL 8

Step2Step 1 Step 3

Procedure

Result & Conclusion

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Result

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Result

Descriptive statistics including mean and standard deviation of each variable used in the proposed model.

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Result

These are all close to or even exceed the recommended level of 0.9 that represents reasonable fit.

( Comparative fit index )( Normed fit fit index )( Tucker-Lewis index )

The RMSEA values between 0.0 and 0.05 indicate a close fit.

( Root Mean Square of Approximation )

Assess the “goddness of fit” of the model.

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Result

Structural equation model

H1

H2

H3

H4

H5

H6

H7

H8 H9H1: Perceived quality has positive impacts on behavioural intentions. Not Supported

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Conclusion

High quality leads to superior perceived value, customer satisfaction, and favourable perceptions of corporate image.Customers’ perceived value was found to affect customer satisfaction, the image of the hotel, and customers more likely to prefer the organisation and recommend it to others.

Reflection

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Reflection

This study My researchFocus on hotelTest the impact of service quality, perceived value, customer satisfaction, and image.

Focus on restaurantTest the impact of customer loyalty, service quality, customer satisfaction, relationship age, and image on repurchase behavior.

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