Service Quality, Customer Satisfaction, Location and Customer Loyalty: Mediation and Moderation Analyses
Arawati Agus

Arawati Agus, UKM Graduate, School of Business UKM-GSB, Universiti Kebangsaan Malaysia, Bangi, Malaysia.
Manuscript received on 29 June 2019 | Revised Manuscript received on 11 July 2019 | Manuscript Published on 17 July 2019 | PP: 652-662 | Volume-8 Issue-2S July 2019 | Retrieval Number: B10970782S19/2019©BEIESP
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Abstract: The purpose of this paper is to examine the importance of incorporating service quality in the Malaysian hypermarket industry. Service quality dimensions investigated in this paper consist of several important determinants namely tangible, reliability, responsiveness, competency, courtesy and credibility. The study measures customers’ perceptions of service quality offered, level of customer satisfaction and loyalty perceived from their experiences shopping in the hypermarkets. The paper specifically investigates the importance of service quality on customer loyalty mediated by customer satisfaction. In addition, the study also tries to discover whether location (strategically) plays a significant moderating role in the linkage between customer satisfaction and customer loyalty. Empirical associations in this study are analyzed through inferential statistical methods such as Pearson’s correlation, hierarchical regression and regression-based mediation analyses. The findings suggest that service quality has significant correlations with both customer satisfaction and customer loyalty. The result also provides evidence that customer satisfaction fully mediates the linkages between tangible, courtesy and credibility and customer loyalty. In addition, location (from strategic perspective) significantly moderates the linkage between customer satisfaction and customer loyalty. Therefore, it is suggested that a more strategic location of a hypermarket can strengthen the relationship between customer satisfaction and customer loyalty and in the long run will benefit the retail business. The findings of the study provide striking demonstrations of the importance of service quality in enhancing customer satisfaction and customer loyalty of Malaysian hypermarkets. The result indicates that Malaysian hypermarkets should emphasise greater attention to dimensions such as tangibles, courtesy and credibility of service quality dimensions and a greater degree of hypermarket management support for service quality enhancement initiatives.
Keywords: Customer Loyalty; Customer Satisfaction; Hierarchical Regression; Hypermarket, Location, Service Quality.
Scope of the Article: Social Sciences