Assessing the effects of satisfaction and value on customer loyalty behaviors in service environments

Purpose - – The primary purpose of this paper is to determine the relative effects of perceived value and customer satisfaction on customer loyalty behaviors. The secondary aim focuses on addressing whether such personal characteristics as gender, age and levels of income and education exert any moderating influence over perceived value/customer satisfaction such that loyalty behaviors, including repurchase intention (RPI), word-of-mouth (WOM) marketing and willingness to pay more (WPM), are ultimately affected. Design/methodology/approach - – The research technique used a face-to-face questionnaire for collecting data from passengers who use the State Railways of the Turkish Republic. A total of 780 questionnaires were collected and used in this study after excluding 80 incomplete forms. First, the main effects of perceived value/customer satisfaction on customer loyalty behaviors were tested using structural equation modeling. Next, customers' personal characteristics, considered as moderating variables, including age, gender and levels of income and education, were examined to determine if their impact on perceived value/customer satisfaction would, in turn, have any effect on loyalty behaviors. To do this, a multigroup moderation test was used. Findings - – The empirical findings of this study show that both customer satisfaction and perceived value directly influence the loyalty behaviors of Turkish railway passengers. However, customer satisfaction was found to be a more important predictor of RPI than perceived service value. However, the relationship between perceived service value and WPM was strong. The association between customer satisfaction and loyalty behaviors was stronger for females, youths and those customers at the lower range of income and education. On the other hand, the association between perceived value and loyalty behaviors was stronger for older passengers with more education and income, irrespective of gender. Originality/value - – The first goal was to assess the main effects of perceived value/customer satisfaction on customer loyalty behaviors. It was found that perceived value/customer satisfaction affected loyalty behaviors, including RPI, WOM and WPM, in different ways. For instance, while customer satisfaction was suggested to be an important predictor of RPI, perceived value was an important predictor of WPM. Importantly, this study also examines how customers' personal characteristics, i.e. moderating variables in this study, impact perceived value/customer satisfaction such that loyalty behaviors are demonstrably changed. Thus, with this additional knowledge of customers' personal characteristics in the context of loyalty behaviors, marketers can create new strategies to develop long-term brand loyalty.