Relative strength of factors influencing customer loyalty in the automobile service industry: a study

Abstract

Contemporary service marketing literature has focused a great deal on the importance of Service Quality. The SERVQUAL Model has been widely used to measure this construct. The SERVQUAL Model is a measure of the quality of the process, personnel and physical evidence of services. The gap in service literature seems to be in examining the relative effectiveness of the other significant construct- Customer Satisfaction on Customer Loyalty. While Service Quality is a laudable goal, it must be seen as an input to the end result, which is Customer Loyalty. Customer Loyalty is defined as the customer's willingness to patronize the service for extended periods, recommend the service to others, continue to patronize it even if there is a marginal increase in price and pay a premium over competing offerings. If there is another more effective way to achieve Customer Loyalty, that should certainly be examined. The other way could be Customer Satisfaction, defined as the outcome of service and the perceived fairness of pricing. The experimental study indicates that the correlation between Customer Satisfaction and Customer Loyalty, is greater than the correlation between Service Quality and Customer Loyalty. This finding could lead to an approach to managing services which is different from the one advocated in much of contemporary service literature.