An investigation of service quality, customer satisfaction and loyalty in China’s airline market

Jiang, Hongwei and Zhang, Yahua (2016) An investigation of service quality, customer satisfaction and loyalty in China’s airline market. Journal of Air Transport Management, 57. pp. 80-88. ISSN 0969-6997

Abstract

Customer loyalty is a source of competitive advantage and an important intangible asset to any organisations, but empirical evidence from China’s airline market regarding the determinants of passenger satisfaction and loyalty is lacking. This paper investigates the service quality of four major airlines in China’s domestic market and explores the links between their service quality and customer satisfaction, as well as the conditions under which airlines can retain existing passengers. In line with previous studies, service quality variables are significant factors influencing customer satisfaction levels. However, satisfactory service was not found to result in higher customer loyalty among business travellers. In comparison to Hainan Airlines, passengers who travelled with Air China, China Southern and China Eastern were more likely to switch to an alternate carrier, indicating lower levels of brand loyalty. In addition, the frequent flyer programs (FFPs) have been largely a failure for the four major airlines in terms of increasing customer loyalty, as revealed in this study. It is necessary to draw distinctions between business and leisure travellers when studying the determinants of customer satisfaction and customer loyalty. Ticket pricing had a positive and significant effect on passengers’ overall satisfaction and in turn strengthened customer loyalty among leisure travellers, but achieved no impact on the satisfaction and loyalty of business passengers. Some demographic variables such as gender, income and education are statistically significant for one group of passengers but not for another in the probit models estimated. It is suggested that different marketing strategies may be used to target different market segments to improve customer loyalty.


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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Additional Information: Permanent restricted access to published version, in accordance with the copyright policy of the publisher.
Faculty / Department / School: Current - Faculty of Business, Education, Law and Arts - School of Commerce
Date Deposited: 12 Dec 2016 23:47
Last Modified: 13 Dec 2016 03:59
Uncontrolled Keywords: customer satisfaction; customer loyalty; airline service quality; Chinese Airlines
Fields of Research : 14 Economics > 1402 Applied Economics > 140217 Transport Economics
Socio-Economic Objective: B Economic Development > 88 Transport > 8803 Aerospace Transport > 880302 Air Passenger Transport
URI: http://eprints.usq.edu.au/id/eprint/30127

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