reena mohamad nasir
DESCRIPTION
factor influencing brand loyalty in mobile servive providers among college of bussiness student of university utara malaysiaTRANSCRIPT
A STUDY ON FACTORS INFLUENCING BRAND LOYALTY IN MOBILE
SERVICE PROVIDERS AMONG COLLEGE OF BUSINESS STUDENTS
OF UNIVERSITI UTARA MALAYSIA
REENA BINTI MOHAMAD NASIR
UNIVERSITI UTARA MALAYSIA
JUNE 2012
A STUDY ON FACTORS INFLUENCING BRAND LOYALTY IN MOBILE
SERVICE PROVIDERS AMONG COLLEGE OF BUSINESS STUDENTS
OF UNIVERSITI UTARA MALAYSIA
by
REENA BINTI MOHAMAD NASIR
Thesis Submitted to
Othman Yeop Abdullah Graduate School of Business,
Universiti Utara Malaysia,
in Fulfillment of the Requirement for the Master of Science
PERMISSION TO USE
In presenting this project paper in partial fulfillment of the requirements for a
postgraduate degree from Universiti Utara Malaysia, I agree that the University Library
make a freely available for inspection. I further agree that permission for copying of this
project paper in any manner, in whole or in part, for scholarly purpose may be granted
by my supervisor or, in their absence by the Dean of Othman Yeop Abdullah Graduate
School of Business. It is understood that any copying or publication or use of this project
paper or parts thereof for financial gain shall not be given to me and to Universiti Utara
Malaysia for any scholarly use which may be made of any material from my project
paper.
Request for permission to copy or make other use of materials in this project paper, in
whole or in part should be addressed to:
Dean of Othman Yeop Abdullah Graduate School of Business
Universiti Utara Malaysia
06010 UUM Sintok
Kedah Darul Aman
ABSTRACT
Mobile phones have become a necessity in human life. This is due to technological
advances that allow people to communicate with each other anywhere and at any
time. This also contributes to the increase in the telecommunication sector of the
country. Leading telecommunication companies are now competing with each other
to become a major provider and attract more customers. This situation also will lead
the customers often switch from one provider to another provider to get the best
service. As competition is increasing among the companies, it is necessary for them
to know about the customers’ perception on price, service quality, promotions, and
trends that play a vital role in choosing the mobile service providers. This study aims
to find out what are critical factors that play an important role to select the
telecommunication service provider. This study was conducted among College of
Business students of Universiti Utara Malaysia. The data is processed by using
quantititave analysis. The method used in analyzed the data are Descriptive Analysis
and Multiple Regression Analysis as there are four variables involved in this study,
which are price, service quality, promotions, and trends. The results provides a
comprehensive analysis of the important factors for the customer to select the mobile
service providers. The analysis confirms that the significant positive relationship of
trends towards brand loyalty. It will be a great challenge for the service providers to
prepare their strategic plan in maintaining customer loyalty, and at the same time
expending their customer base. In conclusion, the mobile service providers should
emphasize the factor such as trends that can maintain customer loyalty as customers
today are more intelligent and smart.
ABSTRAK
Telefon bimbit telah menjadi satu keperluan dalam kehidupan manusia. Ini adalah
disebabkan oleh kemajuan teknologi yang membolehkan kita untuk berkomunikasi
antara satu sama lain di mana-mana sahaja dan pada bila-bila masa. Ini juga
menyumbang kepada peningkatan dalam sektor telekomunikasi negara. Syarikat-
syarikat telekomunikasi kini bersaing antara satu sama lain untuk menjadi pembekal
utama dan menarik lebih ramai pelanggan. Keadaan ini juga mendorong pelanggan
untuk sering bertukar dari satu pembekal kepada pembekal yang lain demi
mendapatkan perkhidmatan yang terbaik. Dengan persaingan yang semakin hebat,
adalah perlu bagi pihak telekomunikasi untuk mengetahui persepsi pelanggan
terhadap harga, kualiti perkhidmatan, promosi, dan trend yang memainkan peranan
penting dalam pemilihan perkhidmatan telekomunikasi. Kajian ini adalah bertujuan
untuk mengetahui faktor kritikal yang memainkan peranan penting dalam pemilihan
pembekal telekomunikasi. Kajian ini telah dijalankan di kalangan pelajar Kolej
Perniagaan di Universiti Utara Malaysia. Data diproses dengan menggunakan kaedah
analisis kuantitatif. Kaedah yang digunakan dalam menganalisis data adalah Analisis
Deskriptif dan Analisis Regresi Berganda kerana terdapat empat pembolehubah yang
terlibat di dalam kajian ini, iaitu harga, kualiti perkhidmatan, promosi, dan trend.
Analisis ini menyediakan keputusan menyeluruh berkenaan faktor penting dalam
pemilihan perkhidmatan telekomunikasi dan juga telah mengesahkan bahawa faktor
trend mempunyai signifikan yang positif terhadap kesetiaan jenama. Ia akan menjadi
satu cabaran besar bagi pembekal perkhidmatan telekomunikasi untuk menyediakan
pelan strategik mereka dalam mengekalkan kesetiaan pelanggan, dan pada masa yang
sama memperluas asas pelanggan mereka. Kesimpulannya, pembekal perkhidmatan
telekomunikasi perlu menitik beratkan faktor seperti trend yang boleh mengekalkan
kesetiaan pelanggan memandangkan pelanggan hari ini lebih bijak dan pintar.
ACKNOWLEDGEMENT
Bismillahirrahmanirrahim, Alhamdulillah, all praise due to ALLAH SWT, the Lord
of the world that makes it possible for me to complete this project paper. I would like
to take this opportunity to express my gratitude and appreciation to the following
individuals whose guidance and contribution in preparing this paper.
Firstly, I would like to express my gratefulness and appreciation to my supervisor,
Prof. Dr. Ruswiati Suryasaputra for her guidance, encouragement and advice
throughout the process of completing this project paper. I am truly indebted for her
contribution in terms of time, patience, attentions and efforts for the completion of
this project paper. Also to Dr. Martino Luis, as the examiner, I would like to thank
for his guidance and kindness. I also want to thank Prof. Dr. Frederick Fernandez,
who also guide and assist me in completing this project paper. I really appreciate
their sacrifices and good deeds. Without them, I would not be able to complete this
project.
I also would like to express my gratefulness to my beloved parents, Mohamad Nasir
bin Abdul Samad and Norsiha binti Tajuddin, and my siblings, Faizal and Fareez for
their constant demonstrations of love and continuous moral supports throughout my
years of study.
I would like to thank all respondents for the cooperation granted during the process
of finishing this project paper. Last, but not least, my thanks to all my friends and all
individuals who are involved direct and indirectly in the process of completing this
study.
THANK YOU
TABLE OF CONTENTS
CONTENTS PAGE
Certification of Project Paper........................................................................ ii
Permission to Use.......................................................................................... iii
Abstract......................................................................................................... iv
Abstrak.......................................................................................................... v
Acknowledgement........................................................................................ vi
Table of Contents.......................................................................................... vii
List of Tables................................................................................................ x
List of Figures............................................................................................... xii
CHAPTER 1: INTRODUCTION
1.1 Background of the Study.................................................................. 1
1.1.1 Concepts of Brand Loyalty...................................................... 1
1.1.2 Customer Loyalty..................................................................... 6
1.1.3 Telecommunication Industry in Malaysia................................. 10
1.1.4 Market Trends in Universiti Utara Malaysia............................. 15
1.2 Problem Statement............................................................................. 16
1.3 Research Questions............................................................................ 17
1.4 Research Objectives........................................................................... 18
1.5 Significance of the Study................................................................... 19
1.6 Scope and Limitations of the Study................................................... 20
1.7 Organization of the Thesis................................................................. 20
1.8 Conclusion.......................................................................................... 21
CHAPTER 2 : LITERATURE REVIEW
2.1 Antecedents of Brand Loyalty........................................................... 23
2.2 Factors of Brand Loyalty..................................................................... 26
2.3 Other Factors of Brand Loyalty............................................................ 31
2.4 Previous Study on Brand Loyalty ....................................................... 36
2.5 Conclusion.......................................................................................... 40
CHAPTER 3 : METHODOLOGY
3.1 Research Framework......................................................................... 41
3.2 Hypotheses Development.................................................................. 43
3.3 Research Design................................................................................. 46
3.4 Operational Definition....................................................................... 47
3.5 Measurement of Variables................................................................. 49
3.6 Pilot Test............................................................................................ 51
3.6.1 Reliability................................................................................. 52
3.6.2 Validity.................................................................................... 53
3.6.3 Multicollinearity....................................................................... 54
3.7 Data Collection.................................................................................. 55
3.7.1 Sampling.................................................................................. 55
3.7.2 Data Collection Procedures....................................................... 56
3.8 Techniques of Data Analysis............................................................. 57
3.9 Conclusion......................................................................................... 58
CHAPTER 4 : RESULTS AND DISCUSSION
4.1 Demographic Characteristics of Respondents................................... 59
4.1.1 Age of Respondents.................................................................. 60
4.1.2 Gender of Respondents............................................................. 60
4.1.3 Respondents’ Level of Education............................................. 61
4.1.4 Respondents’ Current Mobile Service Providers...................... 62
4.1.5 Period of Using Current Mobile Service Providers.................. 62
4.1.6 Type of Services on Mobile Connection.................................. 63
4.2 Hypothesis Testing............................................................................. 64
4.2.1 Test on Hypothesis 1.................................................................. 64
4.2.2 Test on Hypothesis 2.................................................................. 66
4.2.3 Test on Hypothesis 3.................................................................. 67
4.2.4 Test on Hypothesis 4.................................................................. 69
4.2.5 Test on Hypothesis 5.................................................................. 71
4.2.6 Test on Hypothesis 6.................................................................. 73
4.3 Conclusion........................................................................................... 76
CHAPTER 5 : CONCLUSION AND RECOMMENDATION
5.1 Conclusions........................................................................................... 78
5.2 Recommendations................................................................................. 80
REFERENCES.............................................................................................. 83
APPENDICES
LIST OF TABLES
TABLES PAGE
Table 2.1 : Previous Study of Brand Loyalty ................................................ 39
Table 3.1 : Operational Definition of Factors Influencing Brand
Loyalty......................................................................................... 47
Table 3.2 : Likert Scale Score........................................................................ 49
Table 3.3 : Scale of Pilot Test.................................................. 52
Table 3.4 : Reliability Test............................................................................. 53
Table 3.5 : Validity Test................................................................................ 54
Table 3.6 : Multicollinearity Test.................................................................. 55
Table 4.1 : Age of Respondents..................................................................... 60
Table 4.2 : Gender of Respondents................................................................ 61
Table 4.3 : Respondents’ Level of Education................................................ 61
Table 4.4 : Respondents’ Current Mobile Service Providers......................... 62
Table 4.5 : Period of Using Current Mobile Service Providers..................... 63
Table 4.6 : Type of Services on Mobile Connection...................................... 63
Table 4.7 : Model Summary of Price, Promotion, Service Quality, and
Trends........................................................................................... 65
Table 4.8 : ANOVA of Price, Promotion, Service Quality, and Trends
......................................................................................................65
Table 4.9 : Coefficients of Price, Promotion, Service Quality, and
Trends...........................................................................................66
Table 4.10: Model Summary of Price............................................................. 67
Table 4.11: ANOVA of Price.......................................................................... 67
Table 4.12: Model Summary of Promotion..................................................... 68
Table 4.13: ANOVA of Promotion................................................................. 68
Table 4.14: Coefficients of Promotion............................................................ 69
Table 4.15: Model Summary of Service Quality............................................. 69
Table 4.16: ANOVA of Service Quality......................................................... 70
Table 4.17: Coefficients of Service Quality.................................................... 70
Table 4.18: Model Summary of Trends.......................................................... 71
Table 4.19: ANOVA of Trends....................................................................... 72
Table 4.20: Coefficients of Trends.................................................................. 72
Table 4.21: Model Summary of Price, Promotion, Service Quality, and
Trends (Backward).......................................................................74
Table 4.22: ANOVA of Price, Promotion, Service Quality, and Trends
(Backward)...................................................................................74
Table 4.23: Coefficients of Price, Promotion, Service Quality, and Trends
(Backward)...................................................................................75
Table 4.24: Results on Hypothesis Testing..................................................... 77
LIST OF FIGURES
FIGURES PAGE
Figure 1.1 : Elements of Two Dimensional Definition of Loyalty............. 3
Figure 1.2 : General Segmentation of Customers by Loyalty..................... 9
Figure 1.3 : Share of Mobile Subscribers by Major Telcos
(2011)....................................................................................... 12
Figure 3.1 : Schematic Diagram for Theoretical Framework
Model....................................................................................... 42
CHAPTER 1
INTRODUCTION
This chapter presents an introduction to this study to give a picture of the study. The
discussion will be on factors of price, promotion, service quality, and trends that
influence the brand loyalty in mobile service providers. This chapter contains (1)
Background of the Study, (2) Problem Statement, (3) Research Questions, (4)
Research Objectives, (5) Significance of the Study, (6) Scope and Limitation of the
Study, and (7) Organization of the Thesis.
1.1 Background of The Study
Brand loyalty is the company’s major goal sets for a branded product. It is now
become consumer’s priority in making a purchase towards particular brand.
Giddens and Hoffman (2010) stated that brand loyalty does exist because of
consumers start to realize that the brand offers the right product features, images,
conditions, quality, and at the right price. This become the new buying habit among
the consumers recently.
1.1.1 Concepts of Brand Loyalty
Usually, consumers will make a trial purchase seems to perform experiment
in order to review whether the product can give them satisfaction after using
it. Fortunately, if the product is able to achieve their expectations, they will
make repeat purchase continuously, otherwise, they will move to other
brands.
Building and maintaining brand loyalty has been an important marketing
components including the elements of theory and practice in developing
sustainable competitive advantage (Gommans et al., 2001). Therefore, it is
such a big responsibility to all companies in order to increase the brand
loyalty among their customers. Moreover, this days, there are lots of products
that seem similar to mislead the customers in selecting the products. This is
large burden to the companies in order to raise their effort in accordance to
boost the brand loyalty through their brand name.
There are many ways to promote the brand name in order to keep the
customers aware of the products. Pomoni (2009) stated that customers have
their own expectations towards the products, such as past buying experience,
brand significance, word-of-mouth, individual persuasibility and perceptual
distortion, promotional material and communication, competitors’ promises,
and price.
According to Pomoni (2009), Khan (2009), and Gommans et al. (2001), brand
loyalty can be classified into two broad categories. The categories are
behaviorial brand loyalty and attitudinal brand loyalty as shown in Figure 1.1.
Figure 1.1Elements of Two Dimensional Definition of Loyalty Source : Khan (2009)
The attitudinal definition of loyalty implies that loyalty is a state of mind
(Peppers, 2009). By this definition, a customer is loyal to the brand or a
company if they have a positive and preferential attitude toward it. They like
the company, its products or its brands, and they therefore prefer to buy from
it, rather than from the company's competitors.
Peppers (2009) stated that the behavioral definition of loyalty, on the other
hand, depends on actual conduct of the customer, regardless of the attitudes
or preferences that base on the conduct. By this definition, a customer is loyal
to the company if they have made a purchase from the company and then
repeat the purchase again continuously.
Behavioral brand loyalty is measured by proportion of purchases includes
cognitive, conative features, affective, and that imply an indirect relationship
between customer satisfaction and brand loyalty (Pomoni, 2009). In other
words, considerations of the customers’ perceptions about a brand can make
or break the branding strategy of a firm in the context of repurchases when
measuring the level of brand loyalty.
BRAND LOYALTY
Attitudinal Loyalty Behaviorial Loyalty
In the behavioral definition, loyalty is not the cause, but the result of brand
preference. A company that want to increase the customer loyalty will focus
on all tactics will. In fact, they will increase the amount of repurchase
behavior tactics that can easily include, without being limited to, improving
brand preference, product quality, or customer satisfaction. Loyalty is
hesitated with repurchase activity, regardless of any internally held attitudes
or preferences.
Both behavioral and attitudinal brand loyalty consider that consumer have
developed a feeling of preferable attitudes towards the organization and
therefore they engage in repeat purchases. However, marketing studies hold
that, often, repeat purchases occur as a result of convenience or lack of
alternatives in the market (Pomoni, 2009).
Every successful business depends on brand loyalty as it is the ultimate goal a
company aims at. Brand loyalty means a consumer’s commitment to a brand.
It implies that the customer not only looks for their own benefit, but is also
willing to think about the brand’s interest. It is mainly stated by repeat
purchase.
Kulkarni and Belgaonkar (2012) stated that the extent of the faithfulness of
consumers to a particular brand, expressed through their repeat purchases,
irrespective of the marketing pressure generated by the competing brands.
Repurchasing of a product is not the ultimate determinant of brand loyalty. It
might take place because of situational constraints, no alternatives, and
inconvenience.
Brand loyalty is also denote as a customer’s conscious or unconscious
decision that is expressed through the customer’s behavior in purchasing
goods or services. A customer develops loyalty towards a brand because they
think that the brand is offering good quality product or service at the right and
reasonable price. As soon as the customers know that the brand offering value
of their purchase, they will be encouraged to buy the products or services.
As said by Mcmains (2009), a number of things that can influence the brand
loyalty starting from designing a new product to writing its catch line, and
understanding customer’s need to employing effective marketing strategy.
Brand loyalty occurs as the customer perceives the brand in a positive
manner. Developing loyalty among new customers and retaining it among
existing customers are equally important.
The importance of brand loyalty is huge since it is brand loyalty that
determines the sale of a product or a service. It is very difficult to survive in
today’s competitive world among the companies. In order to do so, it is very
important to them to attract more customers, make their customers loyal to
their brand, and not to loose their customers. Reducing the customer loss and
achieving new customer’s trust and loyalty can dramatically improve their
business growth in this industry.
The benefits of brand loyalty for a firm are numerous. First of all, loyal
customers are less price sensitive, which means that they are ready to pay a
higher price, if required, in order to acquire the product or service. As a
result, apart from higher profitability for the firm, the cost incurred for
pursuing new customers is reduced.
To develop brand loyalty, an organization should know their niche market
and target market. They also must need to know and realize on how to
support their product and ensure easy access of their product. In addition,
they also have to find the uniqueness of their products in order to provide
customer satisfaction. Not least, they also have to bring constant innovation in
their product and offer schemes on their product so as to ensure that customer
repeatedly purchase the product.
1.1.2 Customer Loyalty
According to Kuusik (2007), there are three types of behavioral loyal
customers according to their behavior. The three types are (1) forced to be
loyal, (2) loyal due to inertia, and (3) functionally loyal.
For the first type of behaviorial loyal customers, the customers are forced to
be loyal when they have to be clients even they do not have any intention
towards it.. Customers are forced to make a purchase on certain products or
services offered by the certain vendors. This situation ususally happen
because of the monthly target of sales the company have to achieved,
especially the marketing company such as multi level marketing (MLM), and
insurance agents. Because of that, they need to find as many customers they
can in order to achieve the sales target.
However, loyal behaviour may also happen due to inertia. This is the situation
where the customer stick to a brand and do not have any intention to move to
another brand due to the less important of usage of the product. So that in the
customers’ perception, they feel that there is no point to spend time and effort
on searching for the alternatives of the current product and just keep continue
using it.
The functionally loyal customers are loyal may due to several reason.
Probably the customers are satisfied with the price offered, quality of the
product, distribution, or rewards earn through the usage of the product, such
as point redeem, coupons, vouchers, or lucky draws that will lead to the
loyalty of the customers towards the brand.
Compared to Jones and Sasser (1995), they proposed three measures of
customer loyalty, where (1) customer’s primary behavior, in which is related
to recency, frequency, and amount of purchase, (2) customer’s secondary
behavior, referring to the material of customers reference, endorsements, and
the means to spread the word, and (3) customer’s intent to repurchase,
whether the customers are ready to repurchase the product in the future.
Beside that, Jones and Sasser (1995) also noted the general segmentation of
customers by loyalty as in Figure 1.2. Customers loyalty are divided into
three types, namely loyal customers, dubious customers, and disloyal
customers.
There are two types of customers under the loyal customers. For committed
or emotionally loyal customers, they act as active customers that usually loyal
to certain products, and declare will stick to the same product continuously
and in the future. They also will recommend the products to others, especially
to family, relatives, and friends. While for behaviorally loyal customers, they
are active customers who will use only certain products and declare to
continue using it in the future. However, they will not agree to recommend
the product to others.
Ambivalent or dubious customers are the active customers that will use only
the certain products, unfortunately, they are not sure to continue using the
products in the future. These type of customers are in the middle between
loyal and disloyal customers, which led to confusion whether to be loyal or
not. Usually they are more moderate in using a product.
Under disloyal type of customers, there are another two sub-categories, which
are disloyal reducers customers and disloyal leavers customers. For disloyal
reducers customers, they refers to the customers who have reduced or will
reduce the percentage of the product in their usage. Meanwhile for disloyal
leavers customers, they declare that they will certainly leave the products.
Figure 1.2General Segmentation of Customers by LoyaltySource : Jones and Sasser (1995)
A strong professional relationship creates an advantage that can keep the
customer from switching to competitor (Zaribbayevich, 2010). On the other
hand, Dani (2012) stated that retaining an existing customer is always more
beneficial and cost effective than acquiring a new customer. Customers may
also be loyal because they are satisfied and thus want to continue the
relationship.
Thus, it is a major problem for the mobile service providers, especially for
them deliver the quality service consistently. Accordingly, it is important for
a company to understand the customer’ perception to their service quality.
Generally, service and product quality is in the mind of the consumer.
Loyal customers are also strong advocates of the firm playing a powerful role
in the decision making process of other people (Pomoni, 2009). It also will
bring certainty to the firm by enlarging its customer base. In addition, loyal
customers expose higher tolerance for mistakes, are willing to provide
CUSTOMERS
Leavers
Loyal DisloyalDubious
Reducers
Behaviorally
Emotionally
feedback for any unfulfilled needs, to try additional products and to offer a
higher spend of their money in order to meet the higher level of satisfaction
of the customer.
1.1.3 Telecommunication Industry in Malaysia
The telecommunication industry in Malaysia plays a critical role in driving
demand for the internet through investments in expanding reach of 3G
coverage and healthy competition that centres on customers, resulting in
smart bundling of smartphones and plans.
Data services are still considered as a new business in the telecommunication
industry. One of the challenges is to be able to provide internet for all. Thus,
in order to do that, the mobile service providers can not just build a wide
network, but at the same time they need to be able to provide the capacity for
the traffic to flow smoothly. The smartphones will play a key role in the
growth of data revenue.
The smartphone and PDA (personal digital assistant) sales are driven by
fashion trends. The consumers in Malaysia prefer to buy technologically
advanced gadgets. Especially the younger audience would see an added
demand for mobile devices and applications which combine entertainment
and ICT capabilities. For others the mobility and the connectivity at all times
are the important criteria. This is extremely relevant today as more
Malaysians are adopting usage of smartphones stimulated by the popularity of
social media applications, affordable smartphones, and smart bundling.
Telecommunication systems have become electronic infrastructure to transmit
information, voice, messaging, data, graphics, video, music, and the latest 3G
network (Haque et al., 2007). It is a fast-growing technology worldwide
communications. It provides an opportunity for users to choose among mobile
service providers. Now, because of the competition, the mobile service
provider offering innovative services and competitive prices as well.
Kaapanda (2012) said that the emergence of computer-based communication
technologies and communication networks have become an important factor
in this global interaction. Phone, for example, provides basic connection to
social interaction between individuals and relationships both within and
among countries.
Telecom Engine have reported that the participation of the private sector in
the transformation and development of the country's communication
infrastructure has ensured the creation of necessary information
infrastructures. Today, Malaysia has one of the more advanced
telecommunication networks compared to the rest of the developing world.
Modern technologies such as optic fibres, wireless transmission, satellites,
and digitalisation are being utilized with the offering of next generation
networks, unified communication, 3G content, and sensor technology
(www.telecomengine.com).
Convergence in technology provides a diverse range of products and services
offered. Transaction and services such as unified communications, data centre
services, authentication services, e-commerce, payment, services and billing
are conducted daily (Lim, 2011).
In the background of the Malaysian telecommunications, competition can be
seen as a major factor among providers of mobile services. Today, there are
three main companies in the telecommunication sector namely Celcom,
Maxis, and Digi. The three companies known as the mobile service providers
market segments include traditional Malaysian telecommunication
telecommunications, technology and mobile wireless, broadband and
technology markets.
Figure 1.3 shows a competetion among the mobile service providers in
Malaysia. Maxis has lead the telecommunication sector with total of 42
percent of subscribers. Followed by Celcom with 34 percent, and Digi with
24 percent.
Figure 1.3Share of Mobile Subscribers By Major Telcos (2011)Source : Companies, DBS Vickers Research
Celcom Axiata Berhad, is the oldest mobile telecommunications company in
Malaysia. Celcom is one of a member of the Axiata group of companies.
Celcom claims to have the widest and most extensive coverage nationwide,
compared to other mobile services in Malaysia. Celcom also claims its dual-
band GSM (900/1800 MHz) coverage has reached over 99 percent of
Malaysia's populated area in 2006, and 100 percent through satellite coverage
(www.celcom.com.my).
Maxis Communications Berhad is a Malaysian mobile network operator
headquartered at Kuala Lumpur, Malaysia. It was started in the year 1993.
Maxis provides a variety of mobile communication products and services.
Maxis most popular service is its prepaid brand Hotlink, which currently
serves over eight million customers in Malaysia. Maxis was the first mobile
communications company in Malaysia to be authorized to sell the Apple
iPhone, and then was later the offered was also given to its competitor Digi.
Although the pricing of the phone is slightly cheaper than Digi, but the plans
for data and services are slightly higher than Digi (www.maxis.com.my).
Digi Telecommunications Sdn. Bhd., is one of the main mobile service
providers in Malaysia. It is owned in majority by Telenor ASA of Norway
with 49 percent. Digi is listed on the Bursa Malaysia under the Infrastructure
category act. Digi is also the second operator in Malaysia to offer iPhone on
the 1st of April, 2010. Digi is the first mobile service provider in Malaysia to
introduce Mobile Number Selection service which was implemented in 2008
(www.digi.com.my).
The mobile phone has become the favourite way for Malaysians to
communicate. The telecommunications industry is mainly driven by the
cellular segment. In general, a wider subscriber base, increases in
international calls and increased popularity in the usage of mobile data and
multimedia services supported the growth in this segment.
In general, the growth of the mobile services segment is supported by
increasing subscribers, an increase in international calls and increased
popularity of mobile data such as short message service (sms) and GPRS
(general packet radio service) services.
In particular, the mobile market today, this market has become very
competitive and mobile service providers move aggressively to attract
customers by offering several attractive promotions and services (Rahman et
al., 2010). Therefore, in this situation, it is important to know the perception
of consumers on the mobile service provider.
With increasing of competition among companies, it is necessary for the
providers to know the consumer perception of price, promotion, product,
service, quality, and other factors that play an important role in choosing
their service providers (Ismail, 2009).
1.1.4 Market Trends in Universiti Utara Malaysia
In the situation of Universiti Utara Malaysia, all the students now have their
own mobile phones. Even more students that have more than one mobile
phone. This shows that now they have the ability to have a mobile phone.
As well as the students of College of Business, in Universiti Utara Malaysia,
they have started using smartphones and tablet personal computers (PCs)
such as iPhone, iPad and Samsung Galaxy Tab in the classroom as an aid to
learning in order to get the important information or to copy the notes given
in the class. This shows that they are now turning to more sophisticated
technology in line with current technological change in Malaysia now.
Therefore, they would require data services from mobile service providers so
that they can surf the internet anytime and anywhere either by using their
smartphones or tablet PCs. Especially for the international students who need
the services from mobile service providers to enable them to communicate
with their family members in their country.
1.2 Problem Statement
The use of mobile phones has become a primary need in human life. Moreover, at
present, the widespread use of smart phones in this country is due to consumers that
are cleverer and more intelligent and the need of gadget that can simplify their daily
businesses.
As well as students, the use of mobile phones is now a necessity and is no longer for
luxury. This situation has caused them to choose the best mobile service provider
that can benefit and be affordable to them as students.
Based on preliminary survey conducted by random brief interview on certain
students earlier, there are some students who are not stick and loyal to one provider
of mobile services due to various factors.
Among the factors are price, promotions, service quality, and trends. As students,
they will often be influenced by these factors because they are known as those who
like to make hasty decisions, easily influenced by their peers, and others.
Therefore, this study will examin the factors that contribute to brand loyalty in
mobile service providers among students of College of Business, Universiti Utara
Malaysia.
1.3 Research Questions
In this study, several research questions are as follows:
1) Are the price, promotion, service quality, and trends influence significantly
towards brand loyalty simultaneously among the students of College of
Business, Universiti Utara Malaysia?
2) Is there any influence between price towards brand loyalty in mobile service
providers among the students of College of Business, Universiti Utara
Malaysia?
3) Is there any influence between promotion towards brand loyalty in mobile
service providers among the students of College of Business, Universiti Utara
Malaysia?
4) Is there any influence between service quality towards brand loyalty in
mobile service providers among the students of College of Business,
Universiti Utara Malaysia?
5) Is there any influence between trends towards brand loyalty in mobile service
providers among the students of College of Business, Universiti Utara
Malaysia?
6) Which one of the price, promotion, service quality, or trends has the most
significant influence towards brand loyalty among the students of College of
Business, Universiti Utara Malaysia?
1.4 Research Objectives
There are several research objectives that need to be achieved in this study as
follows:
1) To determine whether price, promotion, service quality, and trends influence
significantly towards brand loyalty simultaneously among the students of
College of Business, Universiti Utara Malaysia.
2) To determine the influence of price towards brand loyalty in mobile service
providers among the students of College of Business, Universiti Utara
Malaysia.
3) To determine the influence of promotion towards brand loyalty in mobile
service providers among the students of College of Business, Universiti Utara
Malaysia.
4) To determine the influence of service quality towards brand loyalty in mobile
service providers among the students of College of Business, Universiti Utara
Malaysia.
5) To determine the influence of trends towards brand loyalty in mobile service
providers among the students of College of Business, Universiti Utara
Malaysia.
6) To determine which one of the price, promotion, service quality, or trends has
the most significant influence towards brand loyalty among the students of
College of Business, Universiti Utara Malaysia.
1.5 Significance of the Study
This study contributes to both students as users and the mobile service providers.
Academically, it will widen the dimensions of service quality in mobile service
providers. For the purpose of this study, students are the majority in choosing mobile
service providers. Poor performance can reduce the company’s name. Besides that, it
will give poor image and low reputation of the organization itself in the future.
This study focus on the factors that contributes to the brand loyalty in mobile service
provider among the students of Universiti Utara Malaysia. In general, the findings of
this study will help the company of mobile service provider get a better
understanding towards student perception and impression of the services provided by
them.
1.6 Scope and Limitations of the Study
The scope help to execute the study better and easier. Meanwhile, the limitations also
determine the weaknesses and constraints of the study that are beyond the control.
This study aims to identify the factors (price, promotion, service quality, and trend)
that influence the brand loyalty in mobile service providers. This was limited to the
College of Business, Universiti Utara Malaysia.
The data needed for the study were obtained through the questionnaires within two
weeks. The respondents of the study were among the students of College of Business
that stay at the Students’ Residential Hall, Universiti Utara Malaysia. The findings of
the study are expected to serve as the basis for the development of the
telecommunications and academic use.
1.7 Organization of the Thesis
Organization of the thesis rovides an overview of the whole chapters in the study.
The study is titled as "A Study on Factors Affecting Brand Loyalty in Mobile Service
Provider in The College of Business Students of Universiti Utara Malaysia" and
organized into five chapters, in order to achieve the objectives of this study.
Chapter 1 : Introduction provides an overview of this study. It is more closely to
the issues arising in this research topic. It will emphasize more on the Background of
the Study, Problem Statement, Research Questions, Research Objectives,
Significance of the Study, and Organization of the Thesis.
Chapter 2 : Literature Review critically reviews the literature and theories related
to the topic of this study. It is meant to act as a base for the experimental and
analytical section of this study. This also is used as a base to guide the development
of the research framework.
Chapter 3 : Methodology describes the methods and techniques used in this study.
It will cover more on Research Framework, Hypotheses Development, Research
Design, Operational Definition, Measurement of Variables, Data Collection on
Sampling and Data Collection Procedures, and Techniques of Data Analysis.
Chapter 4 : Results and Discussion will analyze the data and findings of this
research based on the appropriate method used in this study. It presents complete
results and analyses of the study in order to asses whether the study achieved its
objectives.
Chapter 5 : Conclusion and Recommendation are made based on the findings of
this research. The significance findings are necessary for the continuity of the
recommendation to be proposed in this study for the future research.
1.8 Conclusion
This study aims to find the factors that became the priority of the consumer to be
loyal to a brand, especially in the mobile service providers. In this chapter, the
importance of successful of the study were identified and clear to be developed later.
The overview of brand loyalty, mobile service providers, problem statement,
research questions, research objectives, significance of the study, scope and
limitation of the study, and organization of the thesis already laid to be tested and
observed later.
CHAPTER 2
LITERATURE REVIEW
This chapter reviews previous studies that related to this study. The previous studies
are based on price, promotion, service quality, and trends that influence the brand
loyalty in mobile service providers.
2.1 Antecedents of Brand Loyalty
Over the past decades, brand loyalty has been recognized as a focal point of
marketing literatures and for practitioners (Nawaz & Usman, 2010). In the
telecommunication industry, it is important to ensure the good relationship between
customers and mobile service providers.
Usually, customers have their own habit in product purchasing, such as just buy the
cheap product in order to safe. In order to create brand loyalty in customers,
companies must help the customers to acquire for new way of purchasing, and
reinforce those way as a new habit by reminding customers on the value of their
purchase, and at the meantime, encourage them to continue purchasing those
products in the future.
Look at the current situation, in the highly competitive market, the companies are
competing each other in order to maintain their loyal customers and improving the
customers loyalty. Brand Loyalty is the customers’ conscious and unconscious
decision and action (McMains, 2009). They will point out the loyalty through
intention or behavior, by make a repurchase of a brand continually. It happen
because the consumer are satisfied with the brand that offers the right product
features, image, and level of quality at the right price.
Ditcheva (2011) mentioned that loyal customers contributes to the economies of the
marketing because the cost to seek for new customers could be higher than remaining
the existing of loyal customers. Once the customers recommend the product to
friends, most probably their friends would be influenced. Brand loyalty is important
regarding gaining support from retailers. As from the customers’ point of view,
loyalty are really important because it will save the time in order to think of the
products that should be purchase.
Conceptual definitions are necessary to assess the construct validity' of the adopted
measurement methods. Without them, the correctness of specific brand loyalty
measures cannot be evaluated, and meaningful and meaningless results cannot be
distinguished.
In order for companies to handle the disloyal customers, they need to have the right
method to predict the brand loyalty. However, it has seemed impossible to achieve
the objective and general measurement of brand loyalty. The diverse definition and
operationalization of brand loyalty has been in part due to the various aspects of
brand loyalty. The customers will be brand loyal when they have both attitude and
behavior as favorable. However, it does not clarify the intensity of brand loyalty,
because it includes the possibility that a consumer’s attitude is unfavorable, while the
customers repeat the purchases (Ho, 2010)
Brand loyalty is a customers’ behaviorial attitudes towards the brands. Simply, brand
loyalty is defined as the consumer’s persistent preference for and purchase for a
specific brand. The three main reasons to brand loyalty are facilitating selection,
reducing risks, and saving time and effort in order to increase the customers’ level of
satisfaction. The relative attitude is a combination of purchase involvement and
differences in brand perceived (Jensen and Hansen, 2006).
According to Ewing (2000), brand loyalty could be examined through predict its
impact on future behavioral and analyzing its intentions for actual past behavior. He
also claimed that intentions and expectations of purchase remained to be a valid
research metric. It was found out that as the brand and consumer interface offers the
greater ability of predictive than the retail and consumer interface. The customers are
willing to recommend the product after repurchase it in many times compared to past
behavior.
However, Rundle-Thiele and Bennett (2001) proposed that a classification of brand
loyalty based on classifying the types of market. This is because a measure of single
brand loyalty are not reasonable as the market indicates the measure used to predict
the loyalty should be different. By being this brand loyalty, both customers and
providers will be able to enjoy the benefits, where, the providers will continue earn
the profits, while the customers will continue enjoy the services provided. The
companies are now focusing on customer loyalty because to keep the existing
customers is much cheaper than obtaining the new customers. For purpose to study
and manage brand loyalty, it should start with the clear definition of the constructed
involved, and the development of valid measures.
2.2 Factors of Brand Loyalty
There are many factors which affect the brand loyalty, such as consumer attitude,
pressure from family, influence by the peers, and personal relations of a buyer with
the sales person (Nemati et al., 2010).
There are a number of previous researchers who also feels that among the factors that
influence brand loyalty on the mobile service providers are price, promotion, service
quality, and trends.
Price. Price competition in the mobile telecommunications industry is becoming
more intense. Price plays a crucial role in the telecommunications market, especially
for mobile telecommunications service providers (Kollmann, 2000). It also includes
usage charges and rental charges. Therefore, there will be more customers that
provide commits with the mobile service provider companies that offer lower
charges. Rahman et al. (2011) stated that fairness is the important thing to make
customer satisfy. According to Kollmann (2000), the income of the total minutes of
calls made will be able to determine the success of the commercial basis for network
providers. He also added that the success of the telecommunication sector in the
market is dependent on the use of policies and prices continuing to consider several
levels. However, customers will easily to become disloyal if the price is unfair that
can lead them to switch to other providers. Haque et al. (2007) said that, generally, a
price dominated mass market leads to customers having more choice and the
opportunity to compare the pricing structures of different providers. Hence, the
marketer cannot charge prices higher than the customer is willing and able to pay
(Kaapanda, 2012). Individuals, who are price conscious, are generally not willing to
pay prices for a product if they realized that the price is not reasonable (Ismail,
2009). However, Kollmann (2000) stated that the variable charges are the most
important thing for the decision of the customers. In telecommunication sector,
customers will concern on from whom the product will be purchase other than the
purchase price and usage charges as the important criteria for acceptance. The
companies should keep continue offers the value as the importance of price factors to
the customers that had switch to other competitors as a loyalty determinant in order
to avoid from risk losing the customers (Lee and Murphy, 2005). Customers will pay
for a certain amount of money in order get the products or services. Price perception
may different to other people, as price has a significant influence towards the
consumers buying behavior (Raza and Rehman, 2012). However, according to Zhang
and Feng (2009), price is the monetary cost for a customer to purchase products. It is
the critical determinant that will reflect the customers buying decision. Customers
usually make a decision on product purchasing by rely on price perceived. Moreover,
the price perceptions towards the same products among the customers may be
different. This will make the customers likely to be attracted by perceived
competitive prices, rather than perceived high quality services during the decision
making process.
Promotion. According to Alvarez and Casielles (2005), promotion is a set of stimuli
that are offered sporadically, and it reinforces publicity actions to promote the
purchasing of a certain product. Haque et al. (2007) claimed that the promotional
offer consists of several different objects to create a better sale impact, such as
coupons, samples, premiums, contests, point-of-purchase displays and frequent-
buyer programs. They also said that each of the promotion techniques are intended
to have a direct impact on buying behavior and perception about the company or
service providers. Hence, the goals of promotion are to create awareness, get people
to try products, provide information, keep loyal customers, increase use of a product,
and identify potential customers (Kaapanda, 2012). Moreover, according to Ayob
(2010), through advertising, sales promotion, personal selling, and publicity, product
were introduced to customer and persuade new and old customer to purchase.
Service Quality. Nowadays, consumers and firms are demanding more services as
well as services of increasing quality and sophistication (Kaapanda, 2012).
According to Zeithaml and Bitner (2003), service quality is a focused evaluation that
reflects the customer's perception of specific dimensions of service: reliability,
responsiveness, assurance, empathy, tangibles. Satisfaction, on other hand, is more
inclusive, where it is influenced by perceptions of service quality, product quality,
and price as well as situational factors and personal factors. It is important to attract
more customers. Addition to that, the quality of services provided must also be good,
and provide benefits to customer satisfaction. While according to Gronroos (2000),
the quality of a service is subjectively perceived by customers during the interactions
with a firm. Customer perceptions of the quality of a service are traditionally
measured immediately after the person has consumed the service (Rahman et al.,
2011). Parasuraman et al. (1988) had defined the service quality as the consumers’
judgment about a firm’s overall excellence or superiority. There are several ways for
measurements of service quality proposed by previous researchers and literature. The
famous measurement model of service quality is SERVQUAL developed by
Parasuraman et al. (1988) who measured the differences between customer
expectations and perceptions cross five determinants as follows:
Tangibles : Appearance of physical facilities, equipment,
employees, and communication materials from a
service company.
Reliability : A service company’s ability to perform the
promised service dependably and accurately.
Assurance : Employee’s knowledge and behavior about courtesy
and ability to convey trust and confidence.
Responsiveness : A service company is willing to help customers and
provide punctual services.
Empathy : A service company provides care and
individualized attention to its customers, as well as
having convenient operating hours.
Another study by Gronroos (2000) summarized seven criteria of good perceived
service quality as follows :
1. professionalism and skills;
2. employees’ attitudes and behavior;
3. accessibility and flexibility;
4. reliability and trustworthiness;
5. service recovery;
6. serviscape; and
7. reputation and credibility.
Therefore, service quality is an important element to assess a performance of
products. Offering a high quality service is the best way to create customers trust and
satisfaction, as well as obtaining competitive advantages and building a long-term
relationship with customers. According to Lee and Murphy (2005), service quality
has lower priority in loyalty, but are very critical in switching. That is the reason why
perceived element in service quality may trigger loyalty switching transition, but
satisfaction with service quality may not yield loyalty.
Trends. In the present scenario, customers prefer to choose a product or service
based on the promotion or encouragement given by the surrounding community such
as family and friends. This is because they will feel more confident when they see
the satisfaction received by the family and their friends when using the product or
service. According to Hawkins et al. (1998), the reference group consists not only of
the groups that an individual has a frequent contact with such as family members,
work associates, friends, and classmates, but also include the groups that an
individual does not have a membership in or a direct contact, such as certain
expected groups or people in a certain social level. However, based on the trend
nowadays, the internet and telecommunication technologies are frequently regarded
as two major drivers for creating new value and introducing new services to
customers (Chen & Ching, 2007). While according to Close (2001), people are
thought to be a brand loyal due to a number of reasons. They are involved in
purchase decisions, they are targeted frequently by marketing communications
efforts, and they use brands to become influencers and trendsetters. The factors that
influence to purchasing decisions may be due to their increasing knowledge of the
marketplace and product alternatives.
2.3 Other Factors of Brand Loyalty
Brand loyalty is a vast field.. Apart from the factors above, there are many other
factors that affect brand loyalty. This is due to the many previous studies have been
conducted.
Brand image. Ismail (2009) had defined the brand as “a name, term, sign, symbol,
or design, or combination of these that identifies the maker or seller of a product or
services”. Kuusik (2007) stated that brand image is among the most complex factors
that influence the brand loyalty. Brand loyalty may be affected by the brand image
in two ways. Wheteher the customers express their identity according to the
preferences of brand in consciously or subconsciously. Otherwise, the customers will
classify themselves into different social group, which may contributes to the
evaluation of values in the various groups. However, according to Kim et al. (2001),
they found that the attractiveness of brand personality effect the brand loyalty
indirectly after review the link between the brand personality and loyalty. Other than
that, consumers are prefer to become a partner with someone who have same
preference in image and values and even consumer-brand relationships can be seen
as subjects of perceived compatibility (Fournier, 1998). Similar to Oliver (1999) that
said brand need to be a part of customers self identity and social identity in order to
make the customers be fully loyal. A company should view its brand to be not just a
product or service, but as an brand image that represent a company's philosophies.
According to Kuusik (2007), the importance of brand to a customer can be increase
by high risks involved in the transaction, or costs caused by cancellation of contracts
as the relationship of brand loyalty and customers are really important, otherwise the
company need to find alternatives or to solve the dissatisfaction of brand among
customers. Oliver (1999) proposed that customer loyalty is a role of perceived
product superiority, social bonding, personal fortitude, , and their synergistic effects.
A brands image usually will effect the customers’ expectations and satisfaction
towards products. Brand image relates to the perception or mental picture a customer
holds of a brand and is expressed through the response of the customers.Therefore,
the brand image is very important as it will positively reflect the marketing activities
either reasoned or emotional. Raza and Rehman (2012) stated that building a strong
brand name is not only important in the physical product, but is also a vital issue in
service sector. What customer perceives the brand image during such experience is
critical issue for a service firm to realize. Furthermore, customers is likely to form
brand image in mind from inexperience ways, such as word of mouth from other
consumers, a company’s reputation in public, marketing communication, and so on.
A positive brand image will help the company to convey its brand value to the
customers easier. Beside that, it also will generates favorable word of mouth among
the customers. However, the negative brand image will reflect on the opposite part,
where a neutral or unfamiliar brand image may not bring to any badness, but it will
not increase the effectiveness of communication, such as word of mouth (Zhang and
Feng, 2009).
Switching Cost. According to Aydin and Ozer (2005), switching cost will gives the
advantages to the companies, such as:
(i) The cost reduce customers’ sensitivity to price and satisfaction level.
(ii) Customer perceive functionally homogeneous brands.
In other words, even though the customers had their opportunities to make a decision
in select products and services, they still have to be loyal with continue purchasing
the same products. According to Lee and Murphy (2005), customers will either do
not have intention to switch because they feel burden with the current switching
costs, or will be more attracted to the no or lower switching cost competitors. The
competitors can take the advantages through this position, convince the customers
with the incentives purpose of attempting to pull them away from their preferred
offering. These verbal and physical methods are the obstacles in order to overcome
the brand or service loyalists. As can be seen at this time, the simplest form to solve a
variety of cognitive loyalty, the most difficult is the state action. Thus, the sequence
of cognitive-to-action to bring the analysis close allegiance with the emergence of
full loyalty but still failed to meet the definition of ultimate loyalty for each phase are
subject to attack (Oliver, 1999).
Service Availability. Kaapanda (2012) said that the customers buy goods and
services at the place which is conveniently located, yet prominent to provide
comparatively higher satisfaction levels as compared to the time and effort spent by
the consumer. However, for services, such as telecommunication sectors, it is more
preferrable to talk about accessibility as a marketing mix element, rather than a place.
This is because service is produced and consumed simultaneously.
Satisfaction. Kuusik (2007) stated that the influence of satisfaction towards brand
loyalty may happen due to when the level of satisfaction of the customers are low,
they will move to other competitors. Satisfaction is an outcome after make a
purchase and resulting from the comparison of the customers between the rewards
and cost of the purchase. It will effect the customers perception towards the product,
such as likes or dislikes the service after experiencing it. Generally, it is forced that
satisfaction includes both cognitive and emotional components. Reputation usually
intervene the relationship between satisfaction and loyalty and the relationship
between satisfaction and recommendation. Consumers who have the high frequency
of purchase will be considered satisfied with the products (Nawaz and Usman, 2010).
Costomer satisfaction, is a business term in evaluating the level of satisfaction of the
customers towards the products or services supplied by the company to them. As the
market have become more competitive these days, thus, in order to achieve
customers satisfaction, the major aspect that need to be gained is the imporatant of
key elements in functioning the business. The level of customer satisfaction will be
different to different persons, similarly it will be different in case of products or
service difference (Nemati et al., 2010). Markerters are totally involve in the
satisfaction of the customer. To bring the satisfaction towards the customers in the
best is such as an competitive advantahe to the company (Raza and Rehman, 2012).
The perception of the customers towards the products has been widely used in
measuring the satisfaction of the customers. Therefore, Liu (2008) proposed the five
emotions satisfictory perceived by the customers as follows:
(1) Satisfaction: the products can be accepted or tolerated;
(2) Content: the products bring people with a positive and happy experience;
(3) Relieved: the products remove people’s negative state;
(4) Novelty: the products bring people with freshness and exciting;
(5) Surprise: the products make customer unexpectedly pleased.
Trust. Kuusik (2007) said that the feelings of trustworthiness factors definitely
influenced the brand loyalty. In business, trust is known as one of the most important
elements in stable and collaborative relationship (Akbar and Parvez, 2009). Hence,
customers should perceive quality as their preferences in order tp trust the brand
(Nawaz and Usman, 2010). Moreover, Roostika and Astuti (2011) also stated that the
trusting intentions will make the truster feels secure and is willing to depend on the
trustee. Consequently, in order to trust a service, customers should positively in
perceive the quality. This show that perceived service quality will bring the positive
effect on trust. In practical business activities, in order to establish a long term
successful relationship between all the parties involved, the critical issue will be the
development of trust.
Commitment. Nawaz and Usman (2010) stated that most companies hold a view
that a good management in handling the customers’ complaints and grumbling will
bring a source of barand commitment and brand loyalty. The customer retention rate
may be increase do to the effective way in handling the customers’ complaints. It
also will improves the service quality as well.
Word-of-mouth. Rundle-Thiele and Bennett (2001) claimed that the vital sign of
loyalty is the customer’s willingness to spread the recommend of the company to
others. It is because, when people doing the recommendation, they will put their
reputation on the line, which probably will make the other customers see it as a good
predictor of loyalty. Those people will act as a free advertisement spreader,
declaring information on the satisfying experience with the brand, and offering
proven benefits, which may bring to the automatic recruiting of new consumers that
will do the same thing spread the advertisement and attract more customers. The
group of those customers will probably getting larger, and will influence other
customers to become loyal and committed to the product.
Customer Satisfaction. According to Akbar and Parvez (2009), customer
satisfaction is most popular and established element in several sectors, such as
marketing, economic psychology, consumer research, economics, and welfare
economics (Akbar and Parvez, 2009) . The high believe in the nature of business
services typically will resulted on customers to rely on prior expectations. Thus, this
will make the business service satisfaction is likely to be evaluative in nature.
Moreover, satisfaction is likely to be an priority in dives the loyalty in te setting of
business, as it will implies on the evaluation of the performance of the products with
the previous product purchasing (Russell-Bennett et al., 2007).
2.4 Previous Study on Brand Loyalty
Table 2.1 shows the previous studies that were conducted by several researchers on
brand loyalty in mobile service providers. After the review of each of the previous
study below, it is clear that most of the researchers have found that among the main
factors that influence brand loyalty in mobile service providers are service quality,
price, and promotion.
From the Table 2.1, Kaapanda (2012) has conducted a study entitled “An Evaluation
of Factors Determining The Selection of Mobile Telecommunication Service
Providers in The Northern Region of Namibia”. Eventhough the dependent variable
is not stated and quite general, but the purpose of the study is almost the same, which
is to determine the factors that influence the selection of providers that was
conducted in Namibia. In the study, the author has chosen the social factors, service
quality, price, promotion, and availability of services as the variables. However, after
analysis that was conducted through the Descriptive Statistic, only the service quality
has a significant result on determining the selection of mobile telecommunication
service providers in the Northern Region of Namibia. Therefore, service quality was
adopted as one of the variable in this study.
In the following research, Dani (2012) had chosen “Understanding Brand Loyalty
and Reasons for Change of Service Providers by Consumers of Mobile Services in
Madhya Pradesh and Chattisgarh” as title of her research. She has been using Chi-
Squared Test of Independence as tools of analysis by including availability, price,
advertisement, and packaging as the variables. The result found that price was
significant factor to the change of service providers by consumers of mobile services
in Madhya Pradesh and Chattisgarh. Therefore, price was chosen as one of the
variable in this study.
However, Rahman et al. (2011) had conducted a research on “Choice Criteria for
Mobile Telecom Operator : Empirical Investigation Among Malaysian Customers”.
The variables used in the study were price, service quality, and brand image. They
also decided to run the analysis through Structural Equation Models. The findings
show that only price has significant in the choice criteria for mobile telecom
operator.
Ayob (2010) had chosen “Investigating Brand Loyalty Factors Among Young
Mobile Phone Users” as his reserch topic. The research conducted has involved
switching cost, corporate image, service quality, trust, and promotion as the
variables. After analyzed by the Pearson Correlations Test, the findings approved
that the signicant variable was promotion. The variable of promotion was adopted
due to the finding of the study.
While for Nawaz and Usman (2010), they did a research on “What Makes Customers
Brand Loyal : A Study on Telecommunication Sector of Pakistan”. The variables
involved are service quality, satisfaction, trust, and commitment. They found that the
significant variable is service quality after conducted the Cronbach’s Alfa Test or
known as Reliability Test.
Beside that, the research titled “Exploring Influencing Factors for the Selection of
Mobile Phone Service Providers : A Structural Equational Modelling (SEM)
Approach on Malaysian Consumers” was conducted by Rahman et al. (2010). The
variables for the study were price, service quality, service availability, and
promotion. After run the analysis via Exploratory Factor Analysis, Confirmatory
Factor Analysis, and Structural Equation Modeling, the research found that the
significant variable is price.
However, according to the research done by Zaribbayevich, (2010) titled “County of
Origin and Brand Loyalty on Cosmetic Products Among Universiti Utara Malaysia
Students”, the result found that the significant variable were brand name, style, and
price. This was confirmed after conducting analysis on all variables (brand name,
product quality, price, style, and service quality) through Factor Analysis, Reliability
Analysis, Correlation Analysis, and Regression Analysis. Thus, , the variables of
price and style (trend) were adopted to this study.
Table 2.1 Previous Study of Brand Loyalty
AUTHOR(S) / YEARS / TITLE
VARIABLES RESULT(S)TOOLS OF ANALYSIS
VARIABLESTAKEN
Kaapanda (2012)
An Evaluation of Factors Determining The Selection
of Mobile Telecommunication Service Providers in The Northern
Region of Namibia.
Social Factors
Service Quality
Price
Promotion
Availability of Services
There is significant influence between
Service Qualityand the selection
of providers.
Descriptive Statistic
Service Quality
Dani (2012)
Understanding Brand Loyalty and Reasons for
Change of Service Providers by consumers of Mobile Services in Madhya
Pradesh and Chattisgarh.
Availability
Price
Advertisement
Packaging
There is significant influence between
Price and Brand Loyalty
Chi-Squared Test of
IndependencePrice
Rahman et al. (2011)
Choice Criteria for Mobile Telecom Operator :
Empirical Investigation Among Malaysian
Customers.
Price
Service Quality
Brand Image
There is significant influence between
Price and the selection of providers.
Structural Equation Models
Price
Ayob (2010)
Investigating Brand Loyalty Factors Among Young Mobile Phone Users.
Switching Cost
Corporate Image
Service Quality
Trust
Promotion
There is significant influence between
Promotion and Brand Loyalty
Pearson Correlations
Test
Promotion
Table 2.1 Previous Study of Brand Loyalty (Continued)
AUTHOR(S) / YEARS / TITLE
VARIABLES RESULTTOOLS OF ANALYSIS
VARIABLES TAKEN
Nawaz & Usman (2010)
What Makes Customers Brand Loyal : A Study on Telecommunication Sector
of Pakistan.
Service Quality
Satisfaction
Trust
Commitment
There is significant influence between Service
Quality and Brand Loyalty
Cronbach’s Alfa
(Reliability Test)
Service Quality
Rahman et al. (2010)
Exploring Influencing Factors for the Selection of
Mobile Phone Service Providers : A Structural Equational Modelling (SEM) Approach on
Malaysian Consumers.
Price
Service Quality
Service Availability
Promotion
There is significant influence between
Price and the selection of providers
ExploratoryFactor
Analysis
Confirmatory Factor
Analysis
Structural Equation Modeling
Price
Zaribbayevich (2010)
County of Origin and Brand Loyalty on Cosmetic
Products Among Universiti Utara Malaysia Students
Brand Name
Product Quality
Price
Style
Service Quality
There is significant influence between
Brand Name, Style, and Pricetowards Brand
Loyalty
Factor Analysis
Reliability Analysis
Correlation Analysis
Regression Analysis
Price
Style (Trend)
Source : Research Result
2.5 Conclusion
This chapter presented the previous literatures that implicate the important keywords
in this study such as Brand Loyalty, Price, Promotion, Service Quality, and Trend.
Thus, guided by the previous researches, it will make this study become grounded
and stronger.
CHAPTER 3
METHODOLOGY
Methodology is the most important and critical part in the study. Therefore, the
methodology used in the study must be define and fully describe in order to test the
hypothesis and address the problems of the study as stated in the beginning of the
study. This chapter describes in detail the method used in this study. It consists of (1)
Research Framework, (2) Hypotheses Development, (3) Research Design, (4)
Operational Definition, (5) Measurement of Variables, (6) Data Collection on
Sampling and Data Collection Procedures, and (7) Techniques of Data Analysis.
3.1 Research Framework
Refer to the educational researcher Smyth (2004), he defined the research framework
as a framework that constructed from a combination of a wide range of ideas and
theories that help researchers to identify problems, develop the questions and search
for relevant literature.
Research framework involves the relationship between dependent variable (DV) and
independent variables (IV). In other words, dependent variable (DV) will rely on
independent variable (IV) and the dependent variable (DV) also do not change
independent variable (IV).
Back to this study, there were five variables to be examined based on the research
topic, "A Study on Factors Affecting Brand Loyalty in Mobile Service Provider in
The College of Business Students of Universiti Utara Malaysia".
Four of the variables were independent variables (IV) while the other variable was
dependent variable (DV). The dependent variable (DV) was brand loyalty that relied
on independent variables (IV) which consists of four factors that influence the brand
loyalty (DV) namely price, service quality, promotion, and trends as shown in Figure
3.1.
The figure shows the variables that need to be examined according to the objectives,
research questions, and hypothesis. In this study, all the variables will be analyzed by
examined the influence between all the independent variables (price, promotion,
service quality, and trend) towards dependent variable (brand loyalty) simultaneously
(as showed by the black arrow). Next, all independent variables (price, promotion,
service quality, and trend) will be analyzed separately (as showed by the blue arrow)
in order to test the influence between each of them towards dependent variable
(brand loyalty).
Figure 3.1 Schematic Diagram for Theoretical Framework Model
Price
Promotion
Service Quality
BrandLoyalty
Trends
3.2 Hypothesis Development
Hypothesis refers to a formal statement of an unproven proposition that is
empirically testable (Zikmund et al. , 2010). Hypothesis will be tested through
empirical test. It should be written in manner so that either it can be supported if the
hypothesis are accepted or it will shown to be wrong if the hypothesis are rejected.
There are several hypotheses that have been developed in this study to determine the
relationship between independent variables and dependent variable.
For the first hypothesis, all the factors, price, promotion, service quality, and trend
will be examined simultaneously. This is to determine whether all of these factors are
mutually influential when together or more influential when standing alone.
Therefore, the hypothesis is:
H1 : Price, promotion, service quality, and trends influence significantly
towards brand loyalty simultaneously among students of College of
Business, Universiti Utara Malaysia.
Ismail (2009) had stated that price has been discover as an important factor that will
bring impact to the existence of new products and services, but pricing of a new
product or service is more difficult. However, the unfair and unreasonable changes in
price will cause the customers realize the unfairness and unsatisfactory (Wichai &
Siriluck, 2010). Moreover, Zaribbayevich (2010) also stressed that the customers’
intention of purchase will be difficult to be affected by price the brand loyalty are
built into the brand. Hence, the next hypothesis is:
H2 : Price has a significant influence towards brand loyalty in mobile service
providers among the students of College of Business, Universiti Utara
Malaysia.
According to Ayob (2010), promotion is a tools of marketing mix, apart from price,
place, and people. The function of the promotion is to communicate the company’s
product to the consumers in order to make the consumers aware and attracted to their
products. They aim to give the idea and perception into the mind of customers so that
the customers can differentiate their products from other competitors’ brand. This
will lead to the customers’ continuous purchase and repurchase as well as become
loyal to the brand. Therefore, next hypothesis is:
H3 : Promotion has a significant influence towards brand loyalty in mobile
service providers among the students of College of Business, Universiti
Utara Malaysia.
Service quality has been known as a the main strategic issue in service sectors for the
operating in organizations (Roostika & Astuti, 2011). While Chen and Ching (2007)
had stated that the quality is seems to be the customers’ expectation in order to
receive the perceived value. Furthermore, according to Achour et al. (n.d.), the
finding from the previous studies on service quality had suggested that term of
service quality service providers are quite diverse, even as if do not fit to any single
existing quality model. Therefore, the hypothesis is:
H4 : Service quality has a significant influence towards brand loyalty in mobile
service provider among the students of College of Business, Universiti
Utara Malaysia.
Factor of trend is not borrowed from any of the previous studies as not yet reviewed
by any of previous researchers. It is designed by me in order to study a new factor in
which there is a possibility that it has significant influence on brand loyalty. It could
be contributing a new source of factors that influence to the selection of brand
loyalty in mobile service providers. The trend was also chosen because of people
now are more influenced by factors surrounding, such as family and peers. Besides,
it is also because of looking at the current trend where we are all surrounded by
sophisticated technology that will facilitate our daily lives. Therefore, the proposed
hypothesis is as follow:
H5 : Trends has a significant influence towards brand loyalty in mobile service
providers among the students of College of Business, Universiti Utara
Malaysia.
Next is to choose the most influential factor among the price, promotion, service
quality, and trend towards the brand loyalty in mobile service providers. This is to
determine and ensure that the factor has an impact on brand loyalty compare to other
factors proposed in this study. Therefore, the hypothesis is:
H6 : Which one of the price, promotion, service quality, or trends has the most
significant influence towards brand loyalty among students of College of
Business, Universiti Utara Malaysia.
3.3 Research Design
According to Zikmund et al. (2010), research design is a master plan that specifies
the methods and procedures for collecting and analyzing the needed information. It
will provide the skeleton or plan of action for the used of research.
This study entitled "A Study on Factors Influencing Brand Loyalty in Mobile Service
Providers Among College of Business Students, Universiti Utara Malaysia” is a
research that attempts to review the influence of price, promotions, service quality,
and trends towards brand loyalty in mobile service providers. The framework for this
study is used as a guide for collecting and analyzing data. The data were collected
through questionnaires and analyzed through quantitative measures where the
numeric values collected from the responses in questionnaires can then be used in
statistical computations (SPSS) and hypothesis testing (Zikmund et al., 2010). It is
design to be descriptive and multiple regression so to give insights as to which
factors of price, promotion, service quality, and trends have influence the brand
loyalty in mobile service providers among the students.
3.4 Operational Definition
Operational definitions is a concept that will be processed through operationalization.
This process requires the identification of an appropriate scale according to the
difference in the concept. Scales provide a variety of values that suits to different
values in the concept being measured. Scales also will provide the particular value on
a scale that will be correspondence commensurate with the value of some of the true
concept (Zikmund et al., 2010). Table 3.1 shows all variables involved in this
research, which are brand loyalty, price, promotion, service quality, and trends.
Table 3.1 Operational Definition of Factors Influencing Brand Loyalty
Variables Conceptual Definition Operational Definition
Brand
Loyalty
The tendency of customers to
keep buying the same brand
of a particular product
instead of trying other
brands.
(Macmillan Dictionary
Thesaurus)
Brand Loyalty is the consumer's
conscious or unconscious decision,
expressed through intention or
behavior, to repurchase a brand
continually. (Dani, 2012)
Price
The sum or amount of
money or its equivalent for
which anything is bought,
sold, or offered for sale.
(Dictionary.com)
Price is the medium for exchange
of value between a buyer and
seller.
(Rao, 2011)
Table 3.1 Operational Definition of Factors Influencing Brand Loyalty (continued)
Variables Conceptual Definition Operational Definition
Service
Quality
An assessment of how well a
delivered service conforms to
the client’s expectations.
Service business operators
often assess the service quality
provided to their customers in
order to improve their service,
to quickly identify problems,
and to be better assess client
satisfaction.
(BusinessDictionary.com)
Service quality is a focused
evaluation that reflects the
customer's perception of specific
dimensions of service:
reliability, responsiveness,
assurance, empathy, tangibles.
(Zeithaml and Bitner, 2003)
Promotion
The publicization of a product,
organization, or venture to
increase sales or public
awareness. It includes all
forms of communication other
than advertising that call
attention to products and
services by adding extra values
toward the purchase.
(Google Search)
Promotion is a set of stimuli that
are offered sporadically, and it
reinforces publicity actions to
promote the purchasing of a
certain product.
(Alvarez and Casielles, 2005)
Trend
Trends are the aggregate effect
of many uncoordinated
individual and group actions. It
is a persistent change in social
relations and social structure
over time.
(www.webref.org)
Based on the trend nowadays,
the internet and
telecommunication technologies
are frequently regarded as two
major drivers for creating new
value and introducing new
services to customers (Chen &
Ching, 2007).
Source : Research Result
3.5 Measurement of Variables
Measurement of Variables are the explanation of the method used to measure or test
the variables in a study. Hence, in this study, all the variables are measured through
set of questionnaires. Zimkund et al. (2010) had mentioned that a questionnaire must
be relevant to the extent of all information collected that can addresses the research
question. The questionnaires also must be accurate, where all the information must
be reliable and valid. The questionnaire (see Appendix A) is designed to ensure the
respondents can esily understand the questions and the languange used by using the
straight forward sentences.
The questions used a five-point Likert Scale Method where the respondents have to
answer the questions according to their assent towards the questions. According to
Zikmund et al. (2010), Likert scale is a measure of attitudes that have been designed
to allow the respondents to give rate based on their assent on how strongly they agree
or disagree with carefully constructed statements, that provides the ranging from the
very positive to very negative attitudes toward some object. The score range for
Likert- Scale Method are as in Table 3.2.
Table 3.2Likert Scale Score
Scale ScoreStrongly Agree 5
Agree 4Partly Agree / Disagree 3
Disagree 2Strongly Disagree 1
Source : Zikmund et al. (2010)
All data were keyed-in and analysed by using Statistical Package for Social Science
(SPSS) version 16.0. The questionnaires were adopted and edited from the
instruments that have been developed by Zhang and Feng (2009) because most of the
questions are reliable and capable to achieve the objectives of this study.
Questionnaires are divided into three sections, where Section 1 captured
demographic information, Section 2 captured information on current mobile service
provider used by the students, while Section 3 captured information regarding
students’ assent towards their current mobile service provider based on the variables
(price, service quality, promotions, and trends) used in this study.
Section 1 : Demographic Information
This section consists of three questions which aims to obtain the respondents’
demographic information. Questions asked are related to age, gender, and current
educational level in Universiti Utara Malaysia.
Section 2 : Current Mobile Service Provider Used
This section consists of three questions to obtain the information on current mobile
service provider used by the students. Questions asked related to current mobile
service provider, how long it being used, and which mobile connection services used
by the students.
Section 3 : Students’ Perception on Factors of Brand Loyalty in Mobile Service
Provider
This section consists of 20 statements to assess students’ perception towards all the
variables involved (brand loyalty, price, service quality, promotions, and trends) on
their mobile service providers.
3.6 Pilot Test
Pilot test is a stude on a small-scale research project, where the data are collected
from the respondents similarly with those to be used later in the full study (Zikmund
et al., 2010).
Han and Kim (2010) indicated that validation of the theory’s belief constructs were
needed prior to construction of the final questionnaire. It helps researchers to
construct a questionnaire that is adequate for a specific behavior and population of
interest. Accordingly, a pilot test was conducted in this study.
In the pilot test, 20 initial questionnaires had been sent to participants through
convenience sampling method. This sampling technique selects participants with
convenient accessibility and proximity to the researcher because it is fast,
inexpensive, easy and the participants are readily available. Thus, a pilot test will be
used to confirm the actual respondents’ understanding the questions structured in the
questionnaire.
3.6.1 Reliability
Reliability is the consistency of a set of measurements or of a measuring
instrument, often used to describe a test (Zikmund et al., 2010). This means
that a reliable measure is measuring something consistently, but may not
measure the item itself. Reliability applied to people can tell the probability
that a person (or group) will successfully perform the specified task, under
the specified conditions, for the specified period of time (Blank, 2004).
However, reliability does not imply validity.
Cronbach's Alpha (coefficient alpha, α) is a coefficient of reliability. Kaplan
and Saccuzzo (2008) suggested that α value estimates in the range of 0.70 and
0.80 are good enough for most purposes in basic research. The same point
also proposed by Hair et al. (1998), where the stage of score for the pilot tests
are as shown in Table 3.3.
Table 3.3Scale of Pilot Tests
Score Indicator
< 0.60 Poor
0.60 – 0.70 Moderate
0.70 – 0.80 Good
> 0.80 Very Good
Source : Hair et al. (1998)
As tested in the study, the summary of the reliability (Cronbach's Alpha) are
as in Table 3.4. It shows that the score for the variable of brand loyalty is
0.792 which indicates as good. Score for price is 0.724, also indicated as
good. Indicator for promotion is very good because of the score is 0.962. It is
same with service quality and trend with the score of 0.863 and 0.861
respectively, which indicates as very good. It can be said that all the variables
are reliable for this study.
Table 3.4Reliability Test
Variables Items Cronbach’s Alpha
Brand Loyalty 4 0.792
Price 4 0.724
Promotion 4 0.962
Service Quality 4 0.863
Trend 4 0.861
Source : Research Result
3.6.2 Validity
Validity is defined as the extent to which any measuring instrument measures
what it is intended to measure (Carmines and Zeller, 1979). Validity also
used to improve existing scales, and to evaluate the reliability of scales
already in use. Multivariate procedures like factor analysis can be useful in
establishing construct validity (Zikmund et. al., 2010). Test of validity can be
identified with the degree of correlation between the test and a measure. In
terms of accuracy and precision, reliability is similar to precision, while
validity is similar to accuracy.
According to Table 3.5, overall, all items in each variable is valid. This is
indicated by the overall score for all 20 items are between 0.600 to 0.948,
which indicates that they are valid since the whole score are 0.600 and above
as referred to the scale on Table 3.3.
Table 3.5 Validity Test
Brand
LoyaltyPrice Promotion
Service
QualityTrend
0.693 0.654 0.891 0.600 0.746
0.794 0.721 0.916 0.749 0.779
0.847 0.677 0.948 0.692 0.663
0.845 0.737 0.887 0.807 0.680
Source : Research Result
3.6.3 Multicollinearity
According to Zikmund et al. (2010), multicollinearity is the extent to which
independent variables in a multiple regression analysis are correlated with
each other. High multicollinearity can make interpreting parameter estimates
difficult or impossible. In this study, as in Table 3.6, it shows that score for
the correlation between each of the variables are between 0.284 to 0.577. It
indicates that they do not have a strong correlation between each of the
variables. This is because all the score are below than 0.60 which indicates
the good multicollinearity between the variables as they do not have strong
relation among them.
Table 3.6Multicollinearity Test
PriceService
QualityPromotion Trend
Price 1.000 0.463 0.529 0.284
Service
Quality0.463 1.000 0.483 0.471
Promotion 0.529 0.483 1.000 0.577
Trend 0.284 0.471 0.577 1.000
Source : Research Result
3.7 Data Collection
Next will be the discussion on sampling and data collection procedures used in this
study in order to collect the data from the respondents on the factors (price,
promotion, service quality, and trends) that influencing brand loyalty in mobile
service providers.
3.7.1 Sampling
This study using Simple Random Sampling, where it is a sampling procedure
that assures each element in the population of an equal chance of being
included in the sample (Zikmund et al., 2010). This technique is simple
compare to other techniques because it requires only one stage of sample
selection. The survey is conducted in Universiti Utara Malaysia (UUM). The
target respondents for this study is students of College of Business (COB)
that stay at the Students’ Residential Hall only.
The sample size is 100. However, after distibuting 120 sets of questionnaires
to the respondents, only 92 sets are returned. Roscoe (1975) had proposed the
rules of thumbs for determining the sample size, where sample sizes larger
than 30 and less than 500 are appropriate for most research. As well as by
Carmen and Betsy (2007), they said that, although there are more complex
formula, the general rule of thumb is no less than 50 participants for a
correlation or regression with the number increasing with larger numbers of
independent variables (IVs).
3.7.2 Data Collection Procedures
The only approach in collecting data for this study is through questionnaires,
since this study is based on quantitative methods of analysis. The quantitative
methods of data collection, depending on random sampling and structured
data collection instrument according to the objective that need to be achieve
in this study. Quantitative research is concerned with testing hypotheses that
derived from the study. Data collections were done within two weeks. During
the survey. 120 self-administered questionnaires were distributed to the
respondents. However, only 92 set of responsed questionnaires were returned.
3.8 Techniques of Data Analysis
The study was began with the Pilot Test in order to test the reliability, validity, and
multicollinearity of the items variables before proceed to the real study. Data in this
study were analyzed by using Descriptive Analysis and Multiple Regression
Analysis.
Descriptive analysis refers to the elementary transformation of raw data in a way that
describes the basic characteristics such as central tendency, distribution, and
variability (Zikmund et al., 2010). This analysis are used in analyzing the
demographic background of the respondents.
Then, for hypothesis testing, first, coefficient of determination (R-Squared) will be
tested from the summary table. The R-Squared indicates the degree of the fitness of
the regression line. It also shows how good the sample regression line fit the data. A
high value of R-squared, which is nearer to 1.0 or more than 50 percent, indicates
that line fit very well. In fact, the value of R-Squared implies the extent to which the
variation in explanatory variables can be explained the variation in the dependent
variable.
By refer to Analysis of Variance (ANOVA) table, compare p-value or significance
(as labelled in ANOVA table) with the 95 percent of confidence level (0.05) in order
to test the hypothesis. If the p-value is greater than 0.05, it indicates that the result is
insignificant. However, if the p-value is lower than 0.05, the result is significant.
Finally, the regression equation will be constructed only for the significant results by
refer to the coefficients table. This indicates that the independent variables are able to
predict the dependent variable, where an increase in independent variable, the
dependent variable also will be increase. Example of the regression equation is:
Y = βo + β1X1 + β2X2 + β3X3 + …..+ βnXn + ε
Where,
Y = Dependent Variable
X1, X2,...Xn = Independent Variable
β0 = Intercept term or constant value
β = Coefficient for the independent variables
ε = Error Terms
3.9 Conclusion
This chapter explains the methods on the research design applied in this study. It
explicate on the pilot test, questionnaire and analysis planned to achieve the aims and
objectives of this study.
CHAPTER 4
RESULTS AND DISCUSSION
This chapter will elaborates the various statistic test and interpretation on the result
of the analysis. This study determines the factors that influencing brand loyalty in
mobile service provider among the students of College of Business, Universiti Utara
Malaysia. Total set of questionnaires that were distributed to the respondents were
120 sets. However, only 92 responsed questionnaires returned and can be used in this
study. The results obtained from 92 respondents, were thoroughly analysed and the
output of the result are clearly explained in this section.
4.1 Demographic Characteristic of the Respondents
Mulder (2006) stated that the demographic refers to the study on the populations of
human in accordance to the statistical analysis, such as quantities, characteristics,
where they live, age, income, spending, and so on. Therefore, in this part,
information on respondents’ background will be analyzed through descriptive
analysis. Zikmund et al. (2010) had defined descriptive analysis as the simple
transformation of raw data in a way that depict the basic characteristics such as
central tendency, distribution, and variability. The results for each characteristics
will be summarized in frequency table respectively.
4.1.1 Age of Respondents
Table 4.1 shows the result on the age of the respondents. It shows that 66.3
percent of the respondents (61 respondents) are between 20 to 25 years old.
Meanwhile, 16.3 percent of the respondents (15 respondents) are between 26
to 30 years old. Then, 15.2 percent of the respondents (14 respondents) are
less than 20 years old, while 2.2 percent of the respondents (2 respondents)
are above 30 years old. This shows that, those in the age group of 20 to 25
years old played a large role in determining the factors that influence brand
loyalty in mobile service providers, as they are the majority group in this
study.
Table 4.1Age of Respondents
Ages Frequency Percent (%)
Less than 20 years old 14 15.2
20 – 25 years old 61 66.3
26 – 30 years old 15 16.3
Above 30 years old 2 2.2
Total 92 100.0
Source : Research Result
4.1.2 Gender of Respondents
Table 4.2 shows result on gender of the respondents. It shows that 85.9
percent of the respondents (79 respondents) are female while 14.1 percent of
the respondents (13 respondents) are male. This shows that the women are
more concerned about the use of their mobile service providers, compared to
men who may not be so concerned about their providers.
Table 4.2Gender of Respondents
Gender Frequency Percent (%)
Male 13 14.1
Female 79 85.9
Total 92 100.0
Source : Research Result
4.1.3 Respondents’ Level of Education
Table 4.3 shows the result on respondents’ level of education. It shows that
63.0 percent of the respondents (58 respondents) are first degree students,
while 37.0 percent of the respondents (34 respondents) are master degree
students.
Table 4.3Respondents’ Level of Education
Level of Education Frequency Percent (%)
Master Degree 34 37.0
First Degree 58 63.0
Total 92 100.0
Source : Research Result
4.1.4 Respondents’ Current Mobile Service Provider
Table 4.4 shows the main mobile service providers in Malaysia. Thirty five
respondents (38.04 percent) are Celcom users. Thirty one respondents (33.7
percent) are Maxis users, while 26 respondents (28.3 percent) are Digi
customers. This shows that most of the respondents prefer to use the services
provided by Celcom and Maxis compare to Digi.
Table 4.4Respondents’ Current Mobile Service Provider
Service Providers Frequency Percent (%)
Celcom 35 38.0
Maxis 31 33.7
Digi 26 28.3
Total 92 100.0
Source : Research Result
4.1.5 Period of Using Current Mobile Service Provider
Table 4.5 shows on how long the respondents have been using the mobile
service providers. There are 34 respondents (37.0 percent) have been using
the service providers for less than a year. Followed by 21 respondents (22.8
percent) that have been using the service providers for two years. There are
also 22 respondents (23.9 percent) have been using the providers for three
years, while for four years, there are about 15 respondents (16.3 percent) that
have been using it.
Table 4.5Period of Using Current Mobile Service Provider
Period Frequency Percent (%)
Less than 1 year 34 37.0
2 years 21 22.8
3 years 22 23.9
4 years and above 15 16.3
Total 92 100.0
Source : Research Result
4.1.6 Type of Services on Mobile Connection
Table 4.6 shows the result on the type of mobile connection that are used by
the respondents. It shows that 89.1 percent of the respondent (82 respondents)
are using prepaid services, while 10.9 percent of the respondents (10
respondents) are using postpaid services.
Table 4.6Type of Services on Mobile Connection
Type of Connection Frequency Percent (%)
Postpaid 10 10.9
Prepaid 82 89.1
Total 92 100.0
Source : Research Result
4.2 Hypothesis Testing
All the data below were obtained through the process in Statistical Package for
Social Science (SPSS) version 16.0 software in order to test the hypothesis in this
study. The primary data were collected through questionnaires that distributed to the
respondents. The data collected had been key in into this software and analyzed by
using multiple regression analysis methods. It includes all the variables that were
used in this study, which are price, promotions, service quality, trends, and brand
loyalty for dependent variable. The test of these hypotheses leads to the
accomplishment of study objectives.
4.2.1 Test on Hypothesis 1 (H1)
The proposed hypothesis is :
Price, promotion, service quality, and trends influence significantly
towards brand loyalty simultaneously among students of College of
Business, Universiti Utara Malaysia.
From the regression on Table 4.7, the value for coefficient of determination
(R square) for price, promotion, service quality, and trend simultaneously is
0.573. This indicates that 57.3 percent of the price, promotion, service
quality, and trends (independent variables) influential simultaneously against
brand loyalty (dependent variable). The remaining of 42.7 percent are
influenced by other variables or factors.
Table 4.7Model Summary of Price, Promotion, Service quality, and Trends
Model R R Square Adjusted R Square Std. Error of the Estimate
1 0.757 0.573 0.553 2.486Source : Research Result
Table 4.8 shows that p-value ( probability value) is significant at 0.000. At
the 95 percent of confidence level, p-value is lower than 0.05 (p < 0.05).
Therefore, there is a statistically significant influence between price,
promotion, service quality, and trends towards brand loyalty simultaneously.
Table 4.8ANOVA of Price, Promotion, Service Quality, and Trends
Model Sum of Squares df Mean Square F Sig.
1 Regression 720.919 4 180.230 29.169 0.000a
Residual 537.548 87 6.179
Total 1258.467 91Source : Research Result
Thus, as referred to Table 4.9, the regression equation for price (x1),
promotion (x2), service quality (x3), and trends (x4) is :
y = 0.987 + 0.012 x1 – 0.76 x2 + 0.70 x3 + 0.862 x4
(refer to 3.8, page 58 )
It shows that the equation can be used to predict brand loyalty (y), where an
increase in price (x1), service quality (x3), and trends (x4), and a decrease in
promotion (x2), it will lead to increasing in brand loyalty (y).
Table 4.9Coefficients of Price, Promotion, Service Quality, and Trends
Model
Unstandardized Coefficients
Standardized Coefficients
T Sig.B Std. Error Beta
1 (Constant) 0.987 2.109 0.468 0.641
PriceTotal 0.012 0.122 0.007 0.099 0.921
ServQualityTotal 0.070 0.106 0.062 0.665 0.508
PromotionTotal -0.076 0.138 -0.075 -0.549 0.584
TrendTotal 0.862 0.129 0.798 6.681 0.000Source : Research Result
4.2.2 Test on Hypothesis 2 (H2) :
The proposed hypothesis is :
Price has a significant influence towards brand loyalty in mobile
service providers among the students of College of Business,
Universiti Utara Malaysia.
From the regression on Table 4.10, the coefficient of determination (R
square) for price is 0.003. This indicates that 0.3 percent of the price
(independent variable) influential against brand loyalty (dependent variable).
The remaining of 99.7 percent are influenced by other variables or factors.
Table 4.10Model Summary of Price
Model R R Square Adjusted R Square Std. Error of the Estimate
1 0.052 0.003 -0.008 3.734Source : Research Result
Table 4.11 shows that p-value is significant at 0.623. At the 95 percent of
confidence level, p-value is higher than 0.05 (p > 0.05). Therefore, there is a
statistically insignificant influence between price towards brand loyalty.
Table 4.11ANOVA of Price
ModelSum of Squares
DfMean
SquareF Sig.
1 Regression 3.390 1 3.390 0.243 0.623a
Residual 1255.078 90 13.945
Total 1258.467 91Source : Research Result
4.2.3 Test on Hypothesis 3 (H3) :
The proposed hypothesis is :
Promotion has a significant influence towards brand loyalty in mobile
service providers among the students of College of Business,
Universiti Utara Malaysia.
From the regression on Table 4.12, the coefficient of determination (R
square) for promotion is 0.345. This indicates that 34.5 percent of the
promotion (independent variable) influential against brand loyalty (dependent
variable). The remaining of 65.5 percent are influenced by other variables or
factors.
Table 4.12Model Summary of Promotion
Model R R Square Adjusted R Square Std. Error of the Estimate
1 0.587 0.345 0.338 3.027Source : Research Result
Table 4.13 shows that p-value is significant at 0.000. At the 95 percent of
confidence level, p-value is lower than 0.05 (p < 0.05). Therefore, there is a
statistically significant influence between promotion towards brand loyalty.
Table 4.13ANOVA of Promotion
ModelSum of Squares
DfMean
SquareF Sig.
1 Regression 433.944 1 433.944 47.367 0.000a
Residual 824.523 90 9.161
Total 1258.467 91Source : Research Result
Thus, as referred to Table 4.14, the regression equation for promotion (x2) is:
y = 6.477 + 0.593 x2
It shows that the equation can be used to predict brand loyalty (y), where an
increase in promotion (x2), it will lead to increasing in brand loyalty (y).
Table 4.14Coefficients of Promotion
Model
Unstandardized Coefficients
Standardized Coefficients T Sig.
B Std. Error Beta
1 (Constant) 6.477 1.218 5.315 0.000
PromotionTotal 0.593 0.086 0.587 6.882 0000Source : Research Result
4.2.4 Test on Hypothesis 4 (H4) :
The proposed hypothesis is :
Service quality has a significant influence towards brand loyalty in
mobile service providers among the students of College of Business,
Universiti Utara Malaysia.
From the regression on Table 4.15, the coefficient of determination (R
square) for service quality is 0.059. This indicates that 5.9 percent of the
service quality (independent variable) influential against brand loyalty
(dependent variable). The remaining of 94.1 percent are influenced by other
variables or factors.
Table 4.15Model Summary of Service Quality
Model R R Square Adjusted R Square Std. Error of the Estimate
1 0.243 0.059 0.049 3.627Source : Research Result
Table 4.16 shows that p-value is significant at 0.020. At the 95 percent of
confidence level, p-value is lower than 0.05 (p < 0.05). Therefore, there is a
statistically significant influence between service quality towards brand
loyalty.
Table 4.16ANOVA of Service Quality
ModelSum of Squares
DfMean
SquareF Sig.
1 Regression 74.362 1 74.362 5.652 0.020
Residual 1184.105 90 13.157
Total 1258.467 91Source : Research Result
Thus, as referred to Table 4.17, the regression equation for service quality
(x3) is :
y = 10.401 + 0.277 x3
It shows that the equation can be used to predict brand loyalty (y), where an
increase in service quality (x3), it will lead to increasing in brand loyalty (y).
Table 4.17Coefficients of Service Quality
Model
Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) 10.401 1.796 5.790 0.000
ServQualityTotal 0.277 0.117 0.243 2.377 0.020Source : Research Result
4.2.5 Test on Hypothesis 5 (H5)
The proposed hypothesis is :
Trends has a significant influence towards brand loyalty in mobile
service providers among the students of College of Business,
Universiti Utara Malaysia.
From the regression on Table 4.18, the coefficient of determination (R
square) for trends is 0.570. This indicates that 57.0 percent of the trends
(independent variable) influential against brand loyalty (dependent variable).
The remaining of 43.0 percent are influenced by other variables or factors.
Table 4.18Model Summary of Trends
Model R R Square Adjusted R Square Std. Error of the Estimate
1 0.755 0.570 0.565 2.452Source : Research Result
Table 4.19 shows that p-value is significant at 0.000. At the 95 percent of
confidence level, p-value is lower than 0.05 (p < 0.05). Therefore, there is a
statistically significant influence between trends towards brand loyalty.
Table 4.19ANOVA of Trends
ModelSum of Squares
DfMean
SquareF Sig.
1 Regression 717.262 1 717.262 119.277 0.000
Residual 541.206 90 6.013
Total 1258.467 91Source : Research Result
Thus, as referred to Table 4.20, the regression equation for trends (x4) is:
y = 1.893 + 0.815 x4
It shows that the equation can be used to predict brand loyalty (y), where an
increase in trends (x4), it will lead to increasing in brand loyalty (y).
Table 4.20Coefficients of Trends
Model
Unstandardized Coefficients
Standardized Coefficients T Sig.
B Std. Error Beta
1 (Constant) 1.893 1.189 1.592 0.115
TrendTotal 0.815 0.075 0.755 10.921 0.000Source : Research Result
4.2.6 Test on Hypothesis 6 (H6)
The proposed hypothesis was :
Which one of the price, promotion, service quality, or trends has the
most significant influence towards brand loyalty among students of
College of Business, Universiti Utara Malaysia.
When analyzed through the backward method, only the most significant
variable will be remain in the result. It analyzed by removing the insignificant
variables one by one in stages. It can be seen that at the end of this analysis,
only the variable of trends have remained in Table 4.21, Table 4.22, and
Table 4.23. It means that trends has the most significant influence towards
brand loyalty among students of College of Business, Universiti Utara
Malaysia.
From the regression on Table 4.21, the coefficient of determination (R
square) for trends (backward) is 0.570. This indicates that 57.0 percent of the
trends (independent variable) influential against brand loyalty (dependent
variable). The remaining of 43.0 percent are influenced by other variables or
factors.
Table 4.21Model Summary of Price, Promotion, Service Quality, and Trends(Backward)
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .757a .573 .553 2.486
2 .757b .573 .558 2.472
3 .756c .571 .562 2.462
4 .755d .570 .565 2.452
a. Predictors: (Constant), TrendTotal, PriceTotal, ServQualityTotal, PromotionTotal
b. Predictors: (Constant), TrendTotal, ServQualityTotal, PromotionTotal
c. Predictors: (Constant), TrendTotal, ServQualityTotal
d. Predictors: (Constant), TrendTotalSource : Research Result
Table 4.22 for backward shows that p-value is significant at 0.000. At the 95
percent of confidence level, p-value is lower than 0.05 (p < 0.05). Therefore,
there is a statistically significant influence between trends towards brand
loyalty.
Table 4.22ANOVA of Price, Promotion, Service Quality, and Trends (Backward)
ModelSum of Squares
DfMean
SquareF Sig.
1 Regression 720.919 4 180.230 29.169 0.000a
Residual 537.548 87 6.179
Total 1258.467 91
2 Regression 720.859 3 240.286 39.332 0.000b
Residual 537.609 88 6.109
Total 1258.467 91
3 Regression 718.947 2 359.473 59.299 0.000c
Residual 539.521 89 6.062
Total 1258.467 91
Table 4.22ANOVA of Price, Promotion, Service Quality, and Trends (Backward) (continued)
ModelSum of Squares
DfMean
SquareF Sig.
4 Regression 717.262 1 717.262 119.277 0.000d
Residual 541.206 90 6.013
Total 1258.467 91
a. Predictors: (Constant), TrendTotal, PriceTotal, ServQualityTotal, PromotionTotal
b. Predictors: (Constant), TrendTotal, ServQualityTotal, PromotionTotal
c. Predictors: (Constant), TrendTotal, ServQualityTotal
d. Predictors: (Constant), TrendTotalSource : Research Result
Thus, as referred to Table 4.23 for backward, the regression equation for
trends (x4) will be :
y = 1.893 + 0.815 x4
It shows that the equation can be used to predict brand loyalty (y), where an
increase in trends (x4), it will lead to increasing in brand loyalty (y).
Table 4.23Coefficients of Price, Promotion, Service Quality, and Trends (Backward)
Model
Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) 0.987 2.109 0.468 0.641
PriceTotal 0.012 0.122 0.007 0.099 0.921
ServQualityTotal 0.070 0.106 0.062 0.665 0.508
PromotionTotal -0.076 0.138 -0.075 -0.549 0.584
TrendTotal 0.862 0.129 0.798 6.681 0.000
2 (Constant) 1.123 1.593 0.705 0.483
ServQualityTotal 0.074 0.099 0.065 0.746 0.458
PromotionTotal -0.077 0.137 -0.076 -0.559 0.577
TrendTotal 0.861 0.128 0.797 6.732 0.000
Table 4.23Coefficients of Price, Promotion, Service Quality, and Trends (Backward) (continued)
Model
Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
3 (Constant) 1.415 1.499 0.944 0.348
ServQualityTotal 0.043 0.082 0.038 0.527 0.599
TrendTotal 0.804 0.078 0.744 10.312 0.000
4 (Constant) 1.893 1.189 1.592 0.115
TrendTotal 0.815 0.075 0.755 10.921 0.000Source : Research Result
4.3 Conclusion
After the analyzed of the data of 92 samples, it can be conclude that most of the
respondents were between 20 to 25 years. Majority of them also were female, and
study in the first degree level. Most of them were celcom users, had been using the
services for less than a year, and were prepaid users.
For the results on hypothesis testing, as shown in Table 4.24, it shows that hypothesis
1 is accepted, which indicates that the price, promotion, service quality, and trend
influence the brand loyalty simultaneously. However, hypothesis 2 is rejected where
the price do not influence the brand loyalty. While hypothesis 3 is accepted, which
indicates that promotion influence the brand loyalty. Hypothesis 4 also accepted,
where it indicates that service quality does influence the brand loyalty. Brand loyalty
also can be influenced by trend when hypothesis 5 is accepted. For hypothesis 6, the
most significance variable is trend, where among all the variables, trend has the most
influence towards the brand loyalty.
Table 4.24 Results on Hypothesis Testing
Hypothesis Accept / Reject Remarks
Hypothesis 1 Accept Simultaneously
Hypothesis 2 Reject Price
Hypothesis 3 Accept Promotion
Hypothesis 4 Accept Service Quality
Hypothesis 5 Accept Trend
Hypothesis 6 Accept Trend (most influence)
Source : Research Result
CHAPTER 5
CONCLUSION AND RECOMMENDATION
This chapter presents conclusion and recommendation based on the objectives and
the findings of the study.
5.1 Conclusions
Malaysian telecommunication services are one of Malaysia fast growing sector. It
also have become the most highly developed sector. Accusations of poor network
quality services have been a major reason why customers are switching to another
providers. The changing landscape of the Malaysian mobile market has witnessed the
restructuring of the main players in that market.
As competition is increasing among the companies, especially in the mobile market
today, it lead the market to become extremely competitive. The mobile service
provider also now are moving aggressively to attract customer by offering attractive
promotions and services.
From the review of findings, demographic characteristics of the respondents are
limited to age, gender, and level of educations of the respondents. The women and
those aged between 20 and 25 years are more influential to this study. Whereas, the
majority of the respondents were students in the level of first degree, where they
usually spend less as they were not working. Therefore, they will look for providers
who can offer the lowest rates so they can save.
Majority of the respondents were Celcom users. This is possible because of Celcom
offer the plans or packages that are better than other providers such as “Upax” plan
that is offered exclusively to university students. Beside that, majority of respondents
also had been using the services from their providers for less than a year. This is may
due to the providers that compete among themselves to be the cheapest plan
providers. This also will lead the respondents often switch to other providers to enjoy
the lowest rates. In connection with that, the lower price of prepaid starter pack
nowadays also cause the respondent able often to switch to other providers or use
more than one sim card.
From the findings on variables involved in this study, only the variable of price that
is insignificant towards the brand loyalty. It is due to consumers today that are more
concerned about the quality of service, promotions, and trends over the price. If the
quality of service has been satisfactory, they will not hesitate to spend more.
In addition, the trend is the most influential factor on brand loyalty in mobile service
providers. This is parallel with the current changes in technology and modern
lifestyles, which is now equipped with sophisticated technology and people now are
more capable to afford expensive items. Besides, it was also result of the efforts of
all providers who offer a diversity plan that will provide benefits to all their
customers.
In conclusion, brand loyalty is very closely related and influenced by customer
satisfaction and commitment. Customer loyalty is believed to help the provider to
enhance the reputation and profitability of their companies.
5.2 Recommendations
There are several recommendations drawn from the finding of this study. This
recommendations may be a bit much to help the providers to further expand their
reputation while maintaining the loyalty of their customers.
The providers can attract more customers by offering a lower price for contract of
smartphone or tablet PC (personal computer). This is due to the students today that
tend to prefer the use of tablet PC or smart phone, which is more flexible to carry to
anywhere. With the lower price for the contract of data plan services together with
the gadget, students will be able to have the gadget to facilitate their learning
process. Dani (2012) showed that operators that offer value for money service
automatically become the first choice for the customers. Accordingly, it surely can
increase the number of customers and customers’ loyalty to the providers.
In addition, the providers should also work to improve the quality of their services.
Dani (2012) also said that good network coverage is of umpteen importance for any
telecom operator to be successful and the quality of coverage leads to satisfaction or
dissatisfaction of the customers.
The mobile service providers need to expand the signal coverage, particularly in rural
areas in order to attract more customers. Beside that, they also need to enhance their
3G signal to enable consumers to enjoy their services without interruption, such as
browsing the internet, make video calls, doing the mobile banking transactions,
online shopping, and so on. Beside that, people now are like to spend more time
visiting the social networking such facebook, twitter, and so on. That is why they
really need the services of data plan. Beside that, the providers also must ensure that
no more short message service (sms) scam received by customers that usually will
deduct their credit.
For the promotion, the providers can diversify their style of promotion by having
road tour to promote their products to the universities in Malaysia. By this way,
students will find it easier to interact with the providers and in the mean time enjoy
the services offered.
The providers also need to find new ways to improve their service quality by
listening more to their customer and simultaneously gather more information for
them to improve their services. They also have to take immediate action to any
complaint by the customers in order to avoid the customers switch to another
providers.
Another important thing is, it is suggested that studies in other places by using a
similar approach with a larger sample such as the whole students of high institutions
in Malaysia as the respondents and the users of mobile service providers should be
conducted. This will certainly increase the chances to produce the more precise and
accurate results that represent the opinion of students in Malaysia towards the brand
loyalty in mobile service providers as they are among the major users of mobile
service providers in Malaysia.
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APPENDIX A
QUESTIONNAIRE
TITLE : BRAND LOYALTY IN MOBILE SERVICE PROVIDER
SECTION 1
Please answer the following questions concerning your DEMOGRAPHIC. Please circle for each question.
1. AgeA. Less than 20 years oldB. 20 – 25 years oldC. 26 – 30 years oldD. Above 30 years old
2. GenderA. MaleB. Female
3. Indicate your educational level at Universiti Utara MalaysiaA. MasterB. Degree
SECTION 2
Please answer the following questions concerning your CURRENT MOBILE SERVICE PROVIDER. Please circle for each question.
4. What mobile service provider you are using now?A. CelcomB. MaxisC. Digi
5. How long have you use this mobile service provider?A. Less than 1 yearB. 2 yearsC. 3 yearsD. 4 years and above
6. Which type of mobile connection do you use?A. PostpaidB. PrepaidC.
SECTION 3
The following statements relate your feeling towards mobile service provider you are using now. Please show the extend to which you think the mobile service provider should possess the feature described by each statement below. Each of the statement was accompanied by 5 point of scale, from “Strongly Disagree” (1) to “ Strongly Agree” (5). Please circle the appropriate answer.There are no right or wrong answers.
1. Price
PE1 The rates offered by this operator are reasonable. 1 2 3 4 5
PE2This operator is offering flexible pricing for various services that meet my needs.
1 2 3 4 5
PE3 There are no hidden fees charged by the operator. 1 2 3 4 5
PE4I will continue to stay with this operator unless the price is significantly higher for the same services.
1 2 3 4 5
2. Service Quality
SQ1This operator is consistent in providing good services.
1 2 3 4 5
SQ2This operator updates their customers with the latest information of new services or packages.
1 2 3 4 5
SQ3The counter frontline of this operator are very friendly and willing to help.
1 2 3 4 5
SQ4The operator will take immediate action to solve the customers’ complain.
1 2 3 4 5
Strongly Disagree
Strongly Agree
Partly Agree /
DisagreeDisagree Agree
1 2 3 4 5
3. Promotions
PN1The advertisement of the operator in media (TV,newspaper,etc.) are very attractive and influenced.
1 2 3 4 5
PN2The celebrity ambassador influenced you in choosing the operator.
1 2 3 4 5
PN3The promotion offered by the operator are valuable.
1 2 3 4 5
PN4They use effective promotional strategies to attract customers
1 2 3 4 5
4. Trends
TR1The selection of operator is much more influenced by family.
1 2 3 4 5
TR2The selection of services operator also influenced by friends that using the same operator.
1 2 3 4 5
TR3I am selecting this operator because the trend of using smart phone that need to use data connection.
1 2 3 4 5
TR4I am selecting this operator because the trend of family packages that are more valuable.
1 2 3 4 5
5. Brand Loyalty
BL1I intend to continue using the current operator for a long time.
1 2 3 4 5
BL2Even if others operators’ price is lower, I will keep on using this operator.
1 2 3 4 5
BL3I will encourage friends and relatives to use the services from this operator.
1 2 3 4 5
BL4This operator clearly is able to provide the best service.
1 2 3 4 5
APPENDIX B
PILOT TEST (RELIABILITY, VALIDITY, AND MULTICOLLINEARITY)
Brand Loyalty
Case Processing Summary
N %
Cases Valid 20 100.0
Excluded 0 .0
Total 20 100.0
Reliability :
Reliability Statistics
Cronbach's Alpha N of Items
.792 4
Validity :
Item-Total Statistics
Corrected Item-Total Correlation
Brand Loyalty 1 .693
Brand Loyalty 2 .794
Brand Loyalty 3 .847
Brand Loyalty 4 .845
Price
Case Processing Summary
N %
Cases Valid 20 100.0
Excluded 0 .0
Total 20 100.0
Reliability :
Reliability Statistics
Cronbach's Alpha N of Items
.724 4
Validity :
Item-Total Statistics
Corrected Item-Total Correlation
Price 1 .654
Price 2 .721
Price 3 .677
Price 4 .737
Promotion
Case Processing Summary
N %
Cases Valid 20 100.0
Excluded 0 .0
Total 20 100.0
Relliability :
Reliability Statistics
Cronbach's Alpha N of Items
.962 4
Validity :
Item-Total Statistics
Corrected Item-Total Correlation
Promotion 1 .891
Promotion 2 .916
Promotion 3 .948
Promotion 4 .887
Service Quality
Case Processing Summary
N %
Cases Valid 20 100.0
Excluded 0 .0
Total 20 100.0
Reliability :
Reliability Statistics
Cronbach's Alpha N of Items
.863 4
Validity :
Item-Total Statistics
Corrected Item-Total Correlatio
Service Quality 1 .600
Service Quality 2 .749
Service Quality 3 .692
Service Quality 4 .807
Trend
Case Processing Summary
N %
Cases Valid 20 100.0
Excluded 0 .0
Total 20 100.0
Reliability :
Reliability Statistics
Cronbach's Alpha N of Items
.861 4
Validity:
Item-Total Statistics
Corrected Item-Total Correlation
Trend 1 .746
Trend 2 .779
Trend 3 .663
Trend 4 .680
Multicollinearity :
Correlations
PriceTotalServQuality
TotalPromotion
Total TrendTotal
PriceTotal Pearson Correlation 1 .463* .529* .284
Sig. (2-tailed) .040 .016 .226
N 20 20 20 20
ServQualityTotal
Pearson Correlation .463* 1 .483** .471*
Sig. (2-tailed) .040 .000 .036
N 20 20 20 20
PromotionTotal
Pearson Correlation .529* .483** 1 .577**
Sig. (2-tailed) .016 .000 .008
N 20 20 20 20
TrendTotal Pearson Correlation .284 .471* .577** 1
Sig. (2-tailed) .226 .036 .008
N 20 20 20 20
*. Correlation is significant at the 0.05 level (2-tailed).
**. Correlation is significant at the 0.01 level (2-tailed).
APPENDIX C
HYPOTHESIS 1
Variables Entered/Removedb
Model Variables Entered Variables Removed Method
1 TrendTotal, PriceTotal,
ServQualityTotal, PromotionTotala
. Enter
Model Summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .757a .573 .553 2.486
a. Predictors: (Constant), TrendTotal, PriceTotal, ServQualityTotal, PromotionTotal
ANOVAb
Model Sum of Squares df Mean Square F Sig.
1 Regression 720.919 4 180.230 29.169 .000a
Residual 537.548 87 6.179
Total 1258.467 91
a. Predictors: (Constant), TrendTotal, PriceTotal, ServQualityTotal, PromotionTotal
Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients
t Sig.B Std. Error Beta
1 (Constant) .987 2.109 .468 .641
PriceTotal .012 .122 .007 .099 .921
ServQualityTotal
.070 .106 .062 .665 .508
PromotionTotal -.076 .138 -.075 -.549 .584
TrendTotal .862 .129 .798 6.681 .000
HYPOTHESIS 2
Variables Entered/Removedb
Model Variables Entered Variables Removed Method
1 PriceTotala . Enter
Model Summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .052a .003 -.008 3.734
a. Predictors: (Constant), PriceTotal
ANOVAc
ModelSum of Squares
df Mean Square F Sig.
1 Regression 3.390 1 3.390 .243 .623a
Residual 1255.078 90 13.945
Total 1258.467 91
a. Predictors: (Constant), PriceTotal
Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) 15.698 2.309 6.799 .000
PriceTotal -.083 .169 -.052 -.493 .623
HYPOTHESIS 3
Variables Entered/Removedb
Model Variables Entered Variables Removed Method
1 PromotionTotala . Enter
Model Summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .587a .345 .338 3.027
a. Predictors: (Constant), PromotionTotal
ANOVAb
ModelSum of Squares
df Mean Square F Sig.
1 Regression 433.944 1 433.944 47.367 .000a
Residual 824.523 90 9.161
Total 1258.467 91
a. Predictors: (Constant), PromotionTotal
Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) 6.477 1.218 5.315 .000
PromotionTotal .593 .086 .587 6.882 .000
HYPOTHESIS 4
Variables Entered/Removedb
Model Variables Entered Variables Removed Method
1 ServQualityTotala . Enter
Model Summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .243a .059 .049 3.627
a. Predictors: (Constant), ServQualityTotal
ANOVAb
ModelSum of Squares
df Mean Square F Sig.
1 Regression 74.362 1 74.362 5.652 .020a
Residual 1184.105 90 13.157
Total 1258.467 91
a. Predictors: (Constant), ServQualityTotal
Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) 10.401 1.796 5.790 .000
ServQualityTotal .277 .117 .243 2.377 .020
HYPOTHESIS 5
Variables Entered/Removedb
Model Variables Entered Variables Removed Method
1 TrendTotala . Enter
Model Summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .755a .570 .565 2.452
a. Predictors: (Constant), TrendTotal
ANOVAb
ModelSum of Squares
df Mean Square F Sig.
1 Regression 717.262 1 717.262 119.277 .000a
Residual 541.206 90 6.013
Total 1258.467 91
a. Predictors: (Constant), TrendTotal
Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) 1.893 1.189 1.592 .115
TrendTotal .815 .075 .755 10.921 .000
HYPOTHESIS 6
Variables Entered/Removedb
ModelVariables Entered
Variables Removed Method
1 TrendTotal, PriceTotal, ServQualityTotal, PromotionTotala
. Enter
2. PriceTotal
Backward (criterion: Probability of F-to-remove >= .100).
3. PromotionTotal
Backward (criterion: Probability of F-to-remove >= .100).
4. ServQualityTotal
Backward (criterion: Probability of F-to-remove >= .100).
Model Summary
Model R R Square Adjusted R Square Std. Error of the Estimate
1 .757a .573 .553 2.486
2 .757b .573 .558 2.472
3 .756c .571 .562 2.462
4 .755d .570 .565 2.452
a. Predictors: (Constant), TrendTotal, PriceTotal, ServQualityTotal, PromotionTotal
b. Predictors: (Constant), TrendTotal, ServQualityTotal, PromotionTotal
c. Predictors: (Constant), TrendTotal, ServQualityTotal
d. Predictors: (Constant), TrendTotal
ANOVAe
ModelSum of Squares
df Mean Square F Sig.
1 Regression 720.919 4 180.230 29.169 .000a
Residual 537.548 87 6.179
Total 1258.467 91
2 Regression 720.859 3 240.286 39.332 .000b
Residual 537.609 88 6.109
Total 1258.467 91
3 Regression 718.947 2 359.473 59.299 .000c
Residual 539.521 89 6.062
Total 1258.467 91
4 Regression 717.262 1 717.262 119.277 .000d
Residual 541.206 90 6.013
Total 1258.467 91
a. Predictors: (Constant), TrendTotal, PriceTotal, ServQualityTotal, PromotionTotal
b. Predictors: (Constant), TrendTotal, ServQualityTotal, PromotionTotal
c. Predictors: (Constant), TrendTotal, ServQualityTotal
d. Predictors: (Constant), TrendTotal
Coefficientsa
Model
Unstandardized Coefficients
Standardized Coefficients t Sig.
B Std. Error Beta
1 (Constant) .987 2.109 .468 .641
PriceTotal .012 .122 .007 .099 .921
ServQualityTotal .070 .106 .062 .665 .508
PromotionTotal -.076 .138 -.075 -.549 .584
TrendTotal .862 .129 .798 6.681 .000
2 (Constant) 1.123 1.593 .705 .483
ServQualityTotal .074 .099 .065 .746 .458
PromotionTotal -.077 .137 -.076 -.559 .577
TrendTotal .861 .128 .797 6.732 .000
3 (Constant) 1.415 1.499 .944 .348
ServQualityTotal .043 .082 .038 .527 .599
TrendTotal .804 .078 .744 10.312 .000
4 (Constant) 1.893 1.189 1.592 .115
TrendTotal .815 .075 .755 10.921 .000