Vol. 8 No. 5 (2020): Business & Management Studies: An International Journal
Articles

THE EFFECTS OF PERCEIVED SERVICE QUALITY ON CUSTOMER SATISFACTION AND LOYALTY: A QUANTITATIVE RESEARCH IN THE FOOD AND BEVERAGE INDUSTRY

Elif KOCAGÖZ
Asisst. Prof. Dr., Kahramanmaraş Sütçü İmam University
Ahmet Melih EYİTMİŞ
Asisst. Prof. Dr., Kahramanmaraş Sütçü İmam University

Published 2020-12-25

Keywords

  • Hizmet Kalitesi,
  • Müşteri Memnuniyeti,
  • Müşteri Sadakati,
  • Yeme-İçme İşletmeleri
  • Perceived Service Quality Customer Satisfaction Customer Loyalty Food and Beverage Enterprises

How to Cite

KOCAGÖZ, E., & EYİTMİŞ, A. M. (2020). THE EFFECTS OF PERCEIVED SERVICE QUALITY ON CUSTOMER SATISFACTION AND LOYALTY: A QUANTITATIVE RESEARCH IN THE FOOD AND BEVERAGE INDUSTRY . Business & Management Studies: An International Journal, 8(5), 4575-4610. https://doi.org/10.15295/bmij.v8i5.1681

Abstract

  1. LITERATURE

1.1. RESEARCH SUBJECT

The food and beverage industry is highly competitive, and it is getting increasingly more challenging to ensure customer satisfaction, to create loyalty, and to maintain them (Tuncer, 2017; Aksu, Korkmaz ve Sünnetçioğlu, 2016; Chen, 2012). Both are related to the quality of the services offered by the business. Customers' perceptions of service quality can affect both their satisfaction and loyalty. Studies show that an increase in the service quality of the businesses brings along an increase in customer satisfaction, customer loyalty and customers' intention to recommend the company. In both international and Turkish literature, it is seen that both customer satisfaction and customer loyalty in the food and beverage industry are closely related to the service quality (Yangınlar and Tuna, 2020; Bilgin, 2017; Chen, 2016; Aksu et al., 2016; İlhan and Kılıçhan, 2016; Diab, Mohammed, Mansour and Saad, 2016; Bekar and Kılıç, 2015; Haghigi, Dorosti, Rahnama and Hoseinpour, 2012; Barber, Goodman and Goh, 2011; Hyun, 2010; Bulgan, 2010; Ha and Jang, 2010; Kim, Ng and Kim, 2009; Andaleeb and Conway, 2006).

Service quality is defined as the customer's evaluation of the services provided by the business, and the actual service quality is being explained by the difference between the customers' expectations regarding the quality of the service provided and their perceptions of the quality of the service they received (Kırcova, Köse and Özer, 2020, p. 81-82; Martinez and Martinez, 2010, p. 30; Parasuraman, Zeithaml and Berry, 1985, p. 42-47). Various scales are measuring the service quality in food and beverage enterprises, and most of them were developed based on Parasuraman's five-dimensional SERVQUAL  scale (Parasuraman, Zeithaml and Berry, 1988). One of them is the DINESERV scale. This scale was designed in five dimensions by adapting and reproducing the items of SERVQUAL and LODGESERV scales (Tuncer, 2017, p. 325-326; Hansen, 2014, p. 120; Stevens, Knutson and Patton, 1995). DINESERV is defined as a quality measurement method developed to measure the quality of the service provided in food and beverage establishments (Kılıç ve Kurnaz, 2019, p. 92) and because of the ease and reliability of the scale (Kılıçhan and Ülker, 2015, p. 887), researchers in current studies frequently use it. For example, the DINESERV scale was used in Chun and Nyam-Ochir's study (2020) examining the effects of customer satisfaction on revisiting the same restaurant chain and recommendation behaviour; in Adeinat's study (2019) investigating the service quality perceptions of the customers of three restaurants operating under the same franchising brand; in Kim and Choi's study (2019) revealing the differences between the service standards of managers in all-you-can-eat restaurants and the quality perceptions of the customers.

The dimensions of the service quality within the framework of the DINESERV scale are as follows (Stevens et al., 1995): Tangibles: Tools and equipment used in the provision of services of food and beverage enterprises, personnel (appearance), the place where the service is provided, and other physical elements. Reliability: The ability to fulfil the promise (e.g. orders) reliably and accurately in the services provided. Responsiveness: Willingness to assist the customers to whom the service is provided and to fulfil the service in a fast and punctual manner. Assurance: Knowledgeable service providers/employees who have information about the service provided (e.g. menus, the way meals are made, the materials used), employees' courtesy towards customers and their ability to create trust in them. Empathy: Placing the customer at the centre of the company's services, taking care of them.

Other constructs of this study are customer satisfaction and customer loyalty. Customer satisfaction refers to the state of happiness or pleasure that the customer will experience when the quality perception of the product/service is equal to or above his/her expectations as a result of appropriately fulfilled demands and requests (Kurnuç, Kurucuk and Küçük, 2015, p. 24). Customer loyalty as a concept includes several behavioural, emotional, attitudinal constructs (Küçükergin and Uygur, 2013; Kumar and Shah, 2004; Chaudhuri and Holbrook, 2001) and it refers to the behaviour and feeling of customers to continue to purchase the product/service from the same place and to be a regular customer of the business.

1.2. RESEARCH PURPOSE AND IMPORTANCE

The purpose of this study is to examine to what extent perceived service quality, and in particular, the quality perceptions at five dimensions of the services, affect both customer satisfaction and loyalty, and also to determine the extent to which customer satisfaction explains customer loyalty, at a branch of a national coffee chain operating in the food and beverage industry. The study also aimed to examine whether customers' perceptions of service quality, their satisfaction and loyalty differ significantly between groups in terms of demographic variables, visiting frequency and purpose of visiting the branch. Wilson, Zeithaml, Bitner and Gremler (2016) underline that the service performance is an issue that needs to be monitored continuously due to the heterogeneity of services/employees. This research is the first comprehensive quality measurement at the mentioned branch. Therefore, from the managerial perspective, the study is thought to be useful and beneficial by revealing branch customers' service quality perceptions in general and in each dimension, and finding out how they affect their satisfaction levels and loyalties.

1.3. CONTRIBUTION of the ARTICLE to the LITERATURE     

Since there are no visible studies in the Turkish literature regarding service quality specific to coffee chains as it is examined within the scope of this study, the current study is expected to contribute to the related literature.

  1. DESIGN and METHOD

2.1. RESEARCH TYPE

Survey method, one of the quantitative research methods, was used in this study.

2.2. RESEARCH PROBLEMS

Following research questions are being answered in this study: Does perceived service quality have impacts on customer satisfaction and loyalty at the company in question? How much of the variances in customer satisfaction and loyalty are being explained by the perceived service quality? Which dimensions of the service quality affect customer satisfaction and loyalty? Do customers' perceptions on service quality, satisfaction levels and loyalties differ in terms of demographic variables, visiting frequency and visiting purpose?

2.3. DATA COLLECTION METHOD

The population of the study consists of customers visiting the Kahramanmaraş branch of a national coffee chain. Permissions were obtained from the enterprise before conducting the research. The data was collected by using convenience sampling between 14th and 20th of December 2019. The research was carried out by conducting questionnaires face-to-face to 551 customers inside the branch between the hours of 10:00 and 24:00. Twenty-seven questionnaire forms were invalid. The data obtained from 524 questionnaires were accepted for further analysis.

The questionnaire form used in the study comprises of three parts. In the first part, there are questions on demographic characteristics of the research participants, the visiting frequency of them and their purposes of visiting this branch like drinking coffee, socializing, seeking tranquillity. The second part of the questionnaire includes the DINESERV scale developed by Stevens et al. (1995). The reliability of the scale has been tested (Cronbach's alpha: 0.98). Since the dimensions of the scale are settled in the literature, in order not to disrupt the scientific structure of the scale, reliability analyses were performed for each dimension, namely approaching them as a single construct (Tangibles Cronbach's alpha: 0.90; Reliability Cronbach's alpha: 0.89; Responsiveness Cronbach's alpha: 0.87; Assurance Cronbach's alpha: 0.94; Empathy Cronbach's alpha: 0.94). The third part of the questionnaire includes a seven-item customer satisfaction scale (Cronbach's alpha: 0,90) and a four-item customer loyalty scale (Cronbach's alpha: 0,78) both developed by the researchers.

 

2.4. QUANTITATIVE ANALYSIS

Following analyses were made by using statistical program SPSS: Reliability test, regression analysis, independent samples t-test, ANOVA and Scheffe and Tukey-Kramer Post Hoc tests.

2.5. RESEARCH HYPOTHESES

H1: Perceived service quality positively affect customer satisfaction.

H1a: Quality perception of tangibles positively affect customer satisfaction.

H1b: Quality perception of reliability positively affect customer satisfaction.

H1c: Quality perception of responsiveness positively affect customer satisfaction.

H1d: Quality perception of assurance positively affect customer satisfaction.

H1e: Quality perception of empathy positively affect customer satisfaction.

H2: Perceived service quality positively affect customer loyalty.

H2a: Quality perception of tangibles positively affect customer loyalty.

H2b: Quality perception of reliability positively affect customer loyalty.

H2c: Quality perception of responsiveness positively affect customer loyalty

H2d: Quality perception of assurance positively affect customer loyalty.

H2e: Quality perception of empathy positively affect customer loyalty.

H3: Customer satisfaction positively affects customer loyalty.

H4: Perceived service quality (H4a), customer satisfaction (H4b) and customer loyalty (H4c) differ significantly between groups in terms of gender.

H5: Perceived service quality (H5a), customer satisfaction (H5b) and customer loyalty (H5c) differ significantly between groups in terms of marital status.

H6: Perceived service quality (H6a), customer satisfaction (H6b) and customer loyalty (H6c) differ significantly between groups in terms of education.

H7: Perceived service quality (H7a), customer satisfaction (H7b) and customer loyalty (H7c) differ significantly between groups in terms of employment status.

H8: Perceived service quality (H8a), customer satisfaction (H8b) and customer loyalty (H8c) differ significantly between groups in terms of income.

H9: Perceived service quality (H9a), customer satisfaction (H9b) and customer loyalty (H9c) differ significantly between groups in terms of visiting frequency.

H10: Perceived service quality (H10a), customer satisfaction (H10b) and customer loyalty (H10c) differ significantly between groups in terms of visiting purpose.

  1. FINDINGS and DISCUSSION

3.1. FINDINGS as a RESULT of ANALYSIS

The means of the scales are as follows: Perceived service quality scale's mean =5.53 (SD: 1.23), customer satisfaction scale's mean =5.63 (SD: 1.26) and customer loyalty scale's mean =5.40 (SD: 1.40). In the dimensions of service quality, following means were observed: =5.73 (SD: 1.26) for reliability, =5.53 (SD: 1.49) for responsiveness, =5.52 (SD: 1.37) for assurance, =5.45 (SD: 1.16) for tangibles and: =5.44 (SD: 1.49) for empathy.

Regression analysis results: [No multicollinearity problem detected for the multiple regression models.] Perceived service quality significantly and positively affects customer satisfaction (β=0,781, R2: 0,61, p<0.05). Service quality perceptions at the dimensions tangibles (β=0,343), assurance (β=0,140) and empathy (β=0,235) significantly and positively affect customer satisfaction (p<0.05). Perceived service quality significantly and positively affects customer loyalty (β=0,654, R2: 0,43. p<0.05). Quality perceptions at the dimensions tangibles (β=0,316), reliability (β=0,147), and empathy (β=0,245) significantly and positively affect customer loyalty (p<0.05). Customer satisfaction significantly and positively affects customer loyalty (β=0,758, R2: 0,57, p<0.05).

Independent samples t-test results: The perception of service quality was significantly higher in women ( : 5.67) compared to men ( : 5.41) [p<0.05]. There were no significant differences between these groups regarding customer satisfaction and loyalty. In terms of marital status, there were also no significant differences between groups in service quality perception, customer satisfaction and loyalty.

ANOVA and Post Hoc tests results: There were no significant differences between groups in terms of education level regarding service quality perception, customer satisfaction and loyalty. There was also no significant difference between the groups in the perceptions of service quality in terms of employment status; but both satisfaction ( : 5,52) and loyalty ( : 5,24) of the students’ group were lower than the participants who own their businesses, i.e. entrepreneurs [in customer satisfaction, mean difference: -0,42577, Sig.: 0,07; in customer loyalty, mean difference: -0,53357, Sig.: 0,03]. In terms of income, there were significant differences between the groups in service quality perception, customer satisfaction and loyalty. Those who have higher incomes (5001 TL and more) have higher service quality perceptions ( : 5,85) compared to lower-income group 2 (2500 TL and less) [mean difference: 0,53108, Sig.: 0,00]. Those who have higher incomes (5001 TL and more) are more satisfied ( : 6,05) compared to lower-income group 1 (2501-5000 TL) [mean difference: 0,46136, Sig.: 0,03] and lower-income group 2 [mean difference: 0,60321, Sig.: 0,00]. The loyalty is also stronger at the higher income group (5001 TL and more) ( :5,67) compared to lower-income group 2 [mean difference: 0,44070, Sig.: 0,03]. In terms of visiting frequency, there were significant differences between the groups regarding service quality perception, customer satisfaction and loyalty. Regulars' service quality perception ( : 5,88) was significantly higher compared to first-time visitors of the branch [mean difference: 0,71773, Sig.: 0,02] and to the participants who have previously visited the place at least once -but not regulars- [mean difference: 0,60586, Sig.: 0,00]. Regulars are also more satisfied ( : 5,98) compared to first-time visitors [mean difference: 0,99653, Sig.: 0,00] and to those who are not regulars [mean difference: 0,56479, Sig.: 0,00]. Loyalty is stronger at regulars ( : 5,85), compared to both first-time visitors [mean difference: 1,44111, Sig.: 0,00] and to those who are not regulars [mean difference: 0,70483, Sig.: 0,00]. Loyalty is also stronger at the customers who are not regulars ( : 5,14) compared to first-time visitors [mean difference: 0,73628, Sig.: 0,00]. Lastly, no significant differences were found between groups in terms of visiting purpose in service quality perception, satisfaction and loyalty.

3.2. HYPOTHESIS TEST RESULTS                                                     

Hypetheses H1, H1a, H1d, H1e ,H2 ,H2a, H2b, H2e, H3, H4a, H7b, H7c, H8a, H8b, H8c, H9a, H9b and H9c were accepted and hypotheses H1b, H1c,H2c ,H2d ,H4b, H4c, H5a, H5b, H5c, H6a, H6b, H6c, H7a, H10a, H10b and H10c were rejected.

3.3. DISCUSSING the FINDINGS with the LITERATURE   

The service quality perceptions of the research participants significantly and positively affect both customer satisfaction and loyalty. These findings seem to be consistent with the literature (Bilgin, 2017; Aksu et al. 2016; Diab et al., 2016; Bekar and Kılıç, 2015; Haghigi et al., 2012; Ha and Jang, 2010). In terms of the dimensions of service quality, it was found that quality perceptions of tangibles, assurance and empathy dimensions positively affect both customer satisfaction and customer loyalty, while the effects of reliability and responsiveness were statistically not significant. Findings on the effects of the dimensions of the service quality on customer satisfaction and/or loyalty or findings on the relative importance of the dimensions of the service quality vary in the literature (Chen, 2016; Aksu et al., 2016; Andaleeb and Conway, 2006). These differences in the literature are thought to be natural due to the differentiation of the quality of the services provided by the companies in question. Customer perceptions regarding service elements may naturally differ in each research unit.

  1. CONCLUSION, RECOMMENDATION AND LIMITATIONS

4.1. RESULTS of the ARTICLE 

The service quality perceptions of the research participants significantly and positively affect both customer satisfaction and loyalty. However, it was observed that the variance explained in customer satisfaction was higher than the variance explained in customer loyalty. In terms of the dimensions of service quality, it was found that tangibles, assurance and empathy dimensions positively affect both customer satisfaction and customer loyalty, while the effects of reliability and responsiveness were statistically not significant. Additional analyses were made in order to reveal whether the service quality perceptions, satisfaction levels and loyalties of the participants differ in terms of demographic variables. It was found that the perception of service quality was significantly higher in women compared to men, and there were no significant differences between these groups regarding customer satisfaction and loyalty. There was also no significant difference between the groups in the perceptions of service quality in terms of employment status, but both satisfaction and loyalty of the participants who own their businesses e.g. entrepreneurs were higher than the student segment. Additionally, those who have higher incomes have higher service quality perceptions, as well as satisfaction and loyalty, compared to those with lower incomes. It was also found that the evaluations of the regulars regarding service quality, satisfaction and loyalty were significantly positive than the other two groups, i.e. first-time visitors and those who have previously visited the place at least once. Lastly, in the service quality perception, satisfaction and loyalty, no significant differences were found between the groups in terms of visiting purpose, i.e. socializing, eating&drinking and seeking tranquility&wanting to be alone.

4.2. SUGGESTIONS BASED on RESULTS

Although the service quality perceptions of the participants were high in all groups, the finding that those perceptions explain participants' loyalty less than their satisfaction is thought to be important. Here, it is necessary for this enterprise to determine other explanatory variables of loyalty and to consider them for further decisions. The branch in question will also need to evaluate and examine the reasons for the differences in responses of the participants in terms of some demographic variables. More importantly, there is a necessity for evaluating the results in terms of the dimensions of service quality. As Hansen (2014, p. 120) stated, metrics such as DINESERV provide information to the owners and managers about the service quality of their businesses and give them an idea about the steps to be taken. For this reason, based on the result that customers' quality perceptions on tangibles, assurance and empathy affect their satisfaction and loyalty, the company must provide a sustainable quality on these three dimensions. On the other hand, the branch must also work on reliability and responsiveness dimensions, review the elements of them and ensure a new design that will provide better quality and as a result will affect customers' satisfaction and loyalty. As Wilson et al. (2016) underline, service performance is an issue that needs to be monitored continuously due to the heterogeneity of services/employees. Kırcova et al. (2020, p. 81) also emphasize the difficulty of providing the services, in the same way, every time. Therefore, the branch should monitor service quality in each dimension through systematic studies rather than one-off measurements and should regularly review and accordingly reshape managerial decisions and practices. Lastly, the regulars' perceptions of service quality and their satisfaction levels were significantly higher than the other groups. Did this group scored more positively because they are loyal customers, and the loyal customers tend not to see service failures and tend to forgive the mistakes (Yagil and Luria, 2016; Armağan and Acayip, 2015) or are they loyal customers because they previously had and are still having positive experiences? These questions must be answered since the latter could be evaluated as a favourable situation, while the former does not always guarantee that the company is entirely successful. As Villi stated (2019, p. 60), it is not possible to be utterly faultless in the service sector. Customers' loyalty is also not always completely steady. Therefore, in order to keep regulars loyal and also gain new loyal customers, the company must focus on the sustainability of the quality of the services.         

4.3. LIMITATIONS of the ARTICLE                                       

The study has a methodological limitation that may directly affect the interpretation of the research findings. The research was conducted within the branch while customers were experiencing the services. The averages ​​of the answers given by the participants to all variables mentioned above were above five on a 7-point scale. Were these favourable results obtained under the effects of some variables which were not methodologically considered at this research? Did the existence of the employees during the data collection process or experiencing the service elements while answering the questions affect the answers? Could being already there at the branch on own will be considered as a sign of customer's preference with positive feelings towards the place and therefore, the answers are accordingly relatively positive? Did research affect the way the company served to the customers since the employees were aware of the research process? These are not clear in this study. Further researches can focus on two different samples, i.e. customers who are experiencing the services during the data collection process, namely inside the branch and customers reached outside the branch. A clearer view could be obtained with such research design that eliminates some factors affecting the interpretation of the results and can lead to a better understanding of the issue in question. Lastly, customer satisfaction could be an intermediary variable between perceived service quality and customer loyalty. This concept was out of this research scope. For further studies, intermediation could also be considered while developing research models.

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