A Case Study of Customer Loyalty in Canteen Usage
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Abstract
The objective of this paper is to present a case study of customer loyalty involving food services in a university canteen. The purpose is to provide a practical tool for modeling customer loyalty by using logistic function. Prior literature employed linear equation to model customer loyalty. This paper feels the gap in the literature by showing how logistic function could more accurately predict customer loyalty measurement. The data used in this paper came from 100 written surveys. The instrument employed non-Likert scale (0,1,2,3) to collect quantitative data. Nine variables were tested for their significant relationship to customer loyalty: service quality, customer satisfaction, trust, commitment, switching cost, corporate image, service recovery, emotion, and communication. Linear equation was used as the basis for the logistic function to construct a predictive model. The PDF and CDF of the logistic function were used to verify the validity and reliability of the new model. It was found that trust and emotional commitment are only two factors that significantly contributed to customer loyalty (ANOVA F = 40.33). The predicted model under logistic function showed a mean of 0.60 ± 0.47 with mean residual of 0.50 ± 0.10 or pValue between 0 – 0.10. This study extends Kahneman-Tversky’s prospect theory from risk analysis to customer loyalty study.
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