2.1. Service quality
2.1.1. Definitions of service quality
Service quality is a concept which is interested and debated by many researchers over the years. Although there are many different concepts of service quality, all of them are commonly framed from the customer perspective. Service quality is defined as a comparison of the expected service and the perceived service by the customer (Gronroos, 1984;
Parasuraman et al.,1988) or the extent to which services meet the needs and expectations of the customer (Asubonteng, McCleary, and Swan., 1996). Similarly, service quality is defined as “a measure of how well the service delivered matches customer expectations.
Delivering service quality means conforming to customer expectations on a consistent basis”
by Lewis and Booms (1983). Briefly, “a good service quality is considered as one which meets or exceeds consumer’s expectation of the service” (Parasuraman et al., 1985).
2.1.2. Importance of service quality
Nowadays, service quality has become the most vital factor for the success and survival of many industries. Providing high quality services to customers is the key strategy for survival in today’s competitive service industries such as air transport services (Zeithaml et al., 1996). Nadiri, Hussain, Ekiz, and Erdogan (2008) states that due to high competition, the management in the aviation industry must find ways to better their service by understanding their customers’ needs and then meeting or exceeding these needs. Parasuraman et al. (1991) argue that providing high quality of service is considered as the most effective way to ensure that the company's services are uniquely positioned in a market with the same competitive services.
Since service quality becomes an important factor for aviation industry, there always exists a big question: how should aviation service quality be measured? To answer this question, firstly, it is necessary to identify dimensions of this service.
2.1.3. Dimensions of service quality “
For decades, the dimensions of service quality as well as airline service quality have been discussed in many research papers. Gronroos (1984) develops the first model of service
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quality with three dimensions: technical quality, functional quality, and corporate image. In 1990, the six dimensions of service quality were classified by Gronroos including professionalism and skills; attitude and behavior; accessibility and flexibility; reliability and trustworthiness; recovery; and finally reputation and credibility. Rust and Oliver (1994) propose a model that included three dimensions: service product, service delivery, and service environment. Park, Robertson, and Cheng-Lung (2005) reveal that airline service quality can be classified into three dimensions: reliability and customer service, convenience and accessibility and inflight service. In 1988, in order to measure customer perception of service quality in service and retailing organizations, Parasuraman et al. developed a scale with five dimensions (reliability, responsiveness, assurance, tangibles, and empathy), named SERVQUAL.”
Since the appearance of SERVQUAL scale, many studies have used the dimensions of SERVQUAL to measure the airline service quality. For instance, Bari et al. (2001) develop the AIRQUAL instrument with five dimensions (airline tangibles, terminal tangibles, personnel, empathy, and image) based on SERVQUAL.
2.2. Measuring airline service quality
2.2.1. SERVQUAL model
The SERVQUAL model has been widely used for measuring service quality across industries for many years (Ali, Omar, and Amin, 2013; Wu and Ko, 2013). Parasuraman et al. (1985) propose a model with ten dimensions, including tangibles, reliability, responsiveness, understanding the customers, access, communication, credibility, security, competence and courtesy. In 1988, this model was modified and called the SERVQUAL model, which consists of five dimensions: tangibles, reliability, responsiveness, assurance and empathy.
Since the SERVQUAL scale has received considerable recognition in service marketing, numerous previous studies have applied this scale to measure the service quality
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in many industries (Crompton and Mackay, 1989; Fick and Ritchie, 1991; Finn and Lamb, 1991; Johnson, Michael, and Dunlap, 1988). In aviation industry, most of previous studies used the SERVQUAL model to assess airline service quality (Chiang, Liang, and Yahalom, 2003; Li and Chen, 1998; Park et al., 2005). After that, however, there are many criticisms of this model have been mentioned. One of these criticisms relates to the inapplicability of this scale to all service industries (Bekhet & Al-alak, 2011; Finn & Lamb, 1991). Park et al., (2005) state that, SERVQUAL scale is inappropriate for measuring all features of airline service quality because the airline service quality includes both tangible and intangible aspects, it is different from other service industries.
Generally, SERVQUAL model composes the ground and basis for service quality measurements. To effectively evaluate service quality in different industries, it is needed to improve this scale in their specific environment.
2.2.2. AIRQUAL model
Considering the limitations of SERVQUAL model; Bari, Bitner, Bavik, Ekiz, Hussain,
& Toner (2001) develop a new measurement scale based on SERVQUAL model, namely, AIRQUAL. By using AIRQUAL to measure service quality in Northern Cyprus, both studies of Ekiz et al. (2006) and Nadiri et al. (2008) found that service quality has a statistically significant effect on customer satisfaction. In addition, Nadiri et al. (2008) also found a significant positive influence of service quality on customer loyalty.
Nevertheless, AIRQUAL model is utilized to measure airline service industry in Northern Cyprus but this scale is lack of validity because it does not follow all the necessary steps needed to validate an instrument. Because of this problem the AIRQUAL cannot be applied in other countries. In order to address this problem, a study by Alotaibi (2015) validated the AIRQUAL by following all the steps proposed by Parasuraman et al. (1988).
This hybrid scale provides a more accurate evaluation of the customer perception of service quality in practice. Accordingly, the airline service quality in this research is measured by using AIRQUAL model based on SERVQUAL model.
2.3. Customer satisfaction
“Satisfaction is an overall customer attitude towards a service provider” (Levesque &
McDougall, 1996) or the customers’ emotional response to the difference between what they expect and what they receive (Zineldin, 2000). According to Kotler (2000), “satisfaction is a
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person’s feeling of pleasure or disappointment resulting from comparing a product’s perceived performance (or outcome) in relation to his or her expectations”.
Shin and Elliot (2001) assert that no business can exist without customers. Therefore, if a company wants to be successful and profitable, it must satisfy its customers. Angelova and Zekiri (2011) claim that “satisfied customers form the foundation of any successful business because customer satisfaction leads to repeat purchases, brand loyalty, and positive word of mouth”. In a highly competitive environment, customer satisfaction in the transportation services has an important influence to the long-term survival of the carrier (Rhea and Shrock, 1987), thus airline companies should distinguish how their service meets their customers’
expectations.
2.4. Customer loyalty
Jacoby and Chestnut (1978) define loyalty as a repeat buying behavior and/or the expression of a favorable attitude towards such behavior. Pearson (1996) comes close by saying that customer loyalty as “the mindset of the customers who hold favorable attitude toward a firm, commit to repurchase the company’s product or service, and spread word-of-mouth recommendations to others”.
Customer loyalty is the key to the success and profitability of organizations because
“those consumers that demonstrate the greatest levels of loyalty toward the product or service activity tend to repurchase more often, and spend more money” (Dehghan and Shahin, 2011). Newman and Werbel (1973) suggest that loyal customers who have purchased a brand or service repeatedly considered only the same brand and they do not attempt to search for the relevant information of other brands. For airline companies, customer loyalty has become a key factor in their strategies in the competitive environment (Forgas et al., 2010). Further, Gomez et al. (2006) say that loyal customers are highly attractive to companies because they are less price sensitive and require less effort to contact with.
2.5. Service quality and customer satisfaction
According to Ghylin et al., (2008), defining service quality empowers companies to deliver higher service quality resulting in increased customer satisfaction. Cheng and Rashid (2013) state that managing service quality means that service providers have to match the service performance with the perceived services for customer satisfaction to be achieved. In the same vein, Kotler and Keller (2012) highlight service quality expectations play an
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important role in creating customer satisfaction. Companies achieve acceptable levels of satisfaction by providing services that not only meet customer expectations but also exceed them. In aviation industry, Saha and Theingi (2009) find that service quality has a significant effect on passenger satisfaction in the airline industry; it means that the higher the perceived service quality, the higher is the passenger satisfaction. Likewise, Clemes (2008) states that as service quality improves, the probability of customer satisfaction increases. On the contrary, when customers are not satisfied, they are more likely to switch to other airlines and to not recommend the airline to others (Abdullah et al., 2007).
Hence, the first research hypothesis is:
H1: Airline service quality has a significant effect on customer satisfaction.
2.6. Service quality and customer loyalty
Service quality is vital for an organization's success because it has significant impact on customers' loyalty to service companies (Lin et al., 2009). Chang & Yeh (2002) assert that high level of service quality is crucial in the acquisition and retention loyal customers.
Ostrowski et al. (1993) observe that when all airlines have comparable fares and matching regular flyer programs, the airline with better perceived services will attract passengers from other airlines. Many previous studies found that service quality has a positive influence on consumer loyalty (Roberts et al., 2003; Wong & Soha, 2003).
Thus, the second research hypothesis is:
H2: Airline service quality has a significant effect on customer Loyalty.
2.7. Customer satisfaction and customer loyalty
There are many empirical studies reveals the relationship between customer satisfaction and customer loyalty. Satisfaction is widely known as a predictor of customer loyalty (Gures et al., 2014; Cheng & Rashid, 2013; Wong & Sohal, 2003; Eggert & Ulaga, 2002). Bearden and Teal (1983) assert that consumer satisfaction is essential to marketers because, it is considered as an important determinant of repeat sales, positive word of mouth and consumer loyalty. Many previous research papers prove that satisfaction positively and significantly affect customer loyalty (Amin, Leila, and Zahra, 2014; Naureen and Sahiwal, 2013). In addition, Chandrashekaran et al. (2007) conclude that satisfaction strength is a key driver in translating satisfaction into loyalty and argue that satisfaction translated into loyalty when it is strongly held, while weakly held satisfaction makes customers vulnerable to defection. Fornell (1992) also finds that high customer satisfaction would increase loyalty
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to the company and that customers would be less prone to overtures from competition. Jan et al. (2013) highlight that a number of studies carried out in the airline context provide evidence of a positive correlation between customer satisfaction and loyalty.
Consequently, the third hypothesis is proposed: “
H3: Customer satisfaction has a significant effect on customer loyalty in aviation industry.
2.8. Service quality, customer satisfaction, and customer loyalty
According to Gremler and Brown (1998) and Cronin and Taylor (1992), customer satisfaction and service quality are the prerequisites of loyalty. Danaher and Mattsson (1998) also agree that high customer satisfaction and service quality result in higher customer loyalty and willingness to recommend the service to others. Archana and Subha (2012) state that airline service quality dimensions - i.e., in-flight services, in-flight digital services, and airline back-office operations - are significant predictors of passengers' satisfaction and that this satisfaction influences their loyalty and the airline's image. Similarly, Lovelock and Wirtz (2010) state that service quality is a key input in satisfying customers and that satisfaction forms the basis for developing a loyal customer base. Thus, customer satisfaction can strengthen or weaken the influence given by the quality of service on customer loyalty (Caruana et al., 2000). For that reason, it is expected that customer satisfaction mediates the relationship between service quality and customer loyalty.
H4: Customer satisfaction mediates the relationship between service quality and customer loyalty.”
2.9. Research framework and hypotheses
This research proposes a conceptual framework that investigates the effects of airline service quality on passenger satisfaction and loyalty.
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Figure 2. 1 The proposed conceptual framework
A summary of hypotheses is established for this study as below:
H1: Airline service quality has a significant effect on customer satisfaction.
H2: Airline service quality has a significant effect on customer loyalty.
H3: Customer satisfaction has a significant effect on customer loyalty in aviation industry.
H4: Customer satisfaction mediates the relationship between airline service quality and customer loyalty.
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