A path analysis of customer loyalty of homegrown coffee shops in Davao region

Abstract

The main purpose of the study is to determine the factors that lead to customer loyalty of homegrown coffee shops. This study was also conducted to investigate the relationship of marketing mix, customer expectation, customer ex- perience, customer satisfaction and customer loyalty among homegrown coffee shops. Quantitative study utilized descriptive correlational and causal comparative approach as the research design was utilized in this study. The study employed path analysis to allow the testing of hypothesis based on a proposed causal model. The data were obtained from the 580 homegrown coffee shop customers in Davao Region, Philippines. Sets of questionnaires were used as instruments. Pearson product moment correlation was used to determine the interrelationships between the marketing mix, customer expectation, customer experience, and customer satisfaction to customer loyalty. Multiple linear regression was performed to determine the significant predictor of customer loyalty. Path analysis was utilized in order to analyze the path relationships among the variables. The findings of the study revealed that the level of marketing mix, the level of customer expectation, the level of customer experience, the level of customer satisfaction, and the level of customer loyalty as perceived by the customers of homegrown cof- fee shops were all rated high. This means that there is a high customer satisfaction and customer loyalty in home- grown coffee shops in Davao Region. Moreover, marketing mix, customer expectation, customer experience, and customer satisfaction were highly correlated to customer loyalty. This indicates that the effect to marketing mix, customer expectation, customer experience and customer satisfaction would have a direct effect to customer loy- alty. Meanwhile, all exogenous variables have significant direct influence to customer loyalty. Furthermore, the final model passed all the goodness of fit indices criteria CMIN/DF, p-value, TLI, CFI, GFI, RMSEA, PCLOSE.