Does strategic location strengthen the relationship between Service Quality, Customer Satisfaction And Customer Loyalty?

Abstract

This study investigates the relationships between service quality determinants namely tangible, reliability, responsiveness, competency, courtesy and credibility, with customer satisfaction and loyalty in the context of Malaysian hypermarkets. The paper also investigates the mediating role of customer satisfaction and also determines whether location (from the strategic perspective) plays a significant moderating role in the customer satisfaction-customer loyalty linkage. The findings suggest that service quality has significant relationships with customer satisfaction and customer loyalty measures. The result indicates that three service quality determinants specifically tangibles, courtesy and credibility demonstrate high associations with customer satisfaction and customer loyalty. The result suggests that customer satisfaction has significant mediating role in the relationship between service quality and customer loyalty. In addition, location moderates the linkage between customer satisfaction and customer loyalty in both directions. The findings suggest that a more strategic location of a hypermarket can strengthen the relationship between customer satisfaction and customer loyalty.