DEVELOPMENT OF AIRLINES CUSTOMER LOYALTY MODEL ON DOMESTIC FLIGHTS IN INDONESIA

• Main Author: Pakiding Ba'ka, Alfredo
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/40291
• Institution: Institut Teknologi Bandung

The growth and development of air transportation services in the past few years has been so rapid, especially in developing countries, Indonesia is no exception. This forces stakeholders to be more productive. So, the competition becomes stiffer. Therefore, loyalty is an aspect that needs to be considered in measuring the success of a company as well as a strategy to win the competition. Several recent studies have developed the models of customer loyalty of airlines. This study is trying to develop a loyalty model from two main perspectives, those are attitudinal loyalty and behavioral loyalty. The balance of these two perspectives is often overlooked. Thus, it can lead to unhealthy competition and cause problems. So, it is expected that the developed model can be used as a reference to create the competitiveness and fairness for stakeholders. This research was conducted on domestic flights in Indonesia which are divided into two service classes, low-cost airlines and medium-full service airlines. A total of 33 (thirty-three) indicators were used to measure 8 (eight) constructs. Study collected 600 samples / respondents. The respondents were people who used air transportation services in the past 12 months. Meanwhile, data processing is done using the Multigroup Latent Moderated SEM (LMS) method. This research resulted the significant factors in the loyalty model for both low-cost carriers and medium-full airlines. Significant factors forming a loyalty model are perceived service quality, perceived value, customer satisfaction, trust, attitudinal loyalty, and behavioral loyalty. Meanwhile, inertia and price sensitivity factors were proved insignificant in this research model. In addition, the effect of perceived value on customer satisfaction on low-cost carriers has proven to be stronger than the influence on medium-full service airlines.