085 The Study on Factors Influencing Customer Satisfaction towards XYZ International Airline in Yangon, Myanmar

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1 085 The Study on Factors Influencing Customer Satisfaction towards XYZ International Airline in Yangon, Myanmar Mi Ei Ei Mon Kriengsin Prasongsukarn Sirion Chaipoopirutana the Graduate School of Business, Assumption University The purpose of this research study was to examine the relationship between airline image, service quality (in terms of tangibles, reliability, responsiveness, assurance and empathy) perceived value and customer satisfaction towards MAI airline in Yangon, Myanmar. Hence, it is necessary for marketers to understand the factors influencing customer to the airline. This research study focuses on investigating the difference among factors affecting customer satisfaction towards Myanmar Airways international airline. This study collected the data by using self- administered questionnaires, which were distributed to 400 respondents who had experienced with MAI airline by using judgment and convenience sampling procedure. The Pearson Correlation was applied for the data analysis. This result showed that there is relationship among airline image, service quality (in terms of tangibles, empathy, reliability, assurance and responsiveness), and perceived value on customer satisfaction. The airline industry is one of the important growth sectors of the global economies; its significant contribution is seen to be on an upward trend, as showed even here in Myanmar which international airline chains are opening its branches to reap the market rewards from this competitive industry. Based on this result, the airlines company should focus their service quality, as it is the predetermining of satisfaction and favorable attitude towards the airline. Keywords: Airline image, Service quality, Perceived value, Customer satisfaction.

2 According to Fornell (2001) stated that customer satisfaction in the airline industry is of highest importance for holders in the airline competition. Schulz (2012) stated that the airline industry has seen customer satisfaction as a key marketing approach in differentiating itself from its competitors. Therefore, a heightened understanding of passenger s preference and total worth will enhance customer experience and maximize airline income. Customer satisfaction is one of the objectives of marketing activity linking the process of purchasing and consumption with post purchase phenomena. (Kotler & Armstrong, 2004) stated that satisfying customers is an important element in the marketing concept as it affects future consumer purchase behavior, profitability and shareholder value. Chitty, Ward, & Chua (2007) stated that customer satisfaction has become a key performance indicator for the airline business. Kandampully (2000) and Yilmaz, (2009) argued that service quality is crucial to the success of any service organization. Airline with good service quality will improve their market share and profitability. Park et al (1986) studied that the image is a quite important marketing function as it is sometimes directly associated with sales. Moreover, the airline image does not only convey the goodwill of brand to the customers but also implicitly persuade them to buy your product or service again and again. The image is the objective and mental feedback of the consumers when they purchase a product or service. Zeithaml (1988) stated that perceived value is the consumer s overall assessment of the utility of a product or service based on the comparison of what is received and what is given. Monroe (1973) described that value perception is manipulated consumer satisfaction due to its capability which can be made as the customer approach and as the outcome. Therefore, perceived service quality can deepen customer's memory to form an awareness of the brand image and measured the perceived value of a customer in the psychology of the customer, these results will gain customer satisfaction level. This study is about Factors influencing customer satisfaction of XYZ international airline in Yangon, Myanmar. The researcher will focus on the population of passengers at Yangon international airport who have experienced with MAI airline in Yangon. Literature Review A. AIRLINE IMAGE Keller (1993) defined image as the perceptions about product, service reflected by based on the company associations that are held in consumer memory. It means that the image is what comes to the mind of the consumer when a brand name is mentioned. Consumers associate the

3 image of focus on product or service with tangible and intangible attributes, often it is represented by the feelings and thoughts the consumers have in their minds. Lee et al. (2009) defined that brand association easily helps customer s process information and recovers when they made the purchasing decision because it recalls positive feelings and attitudes toward that product or service. Chiang and Jang (2006) stated the image considerably influences quality and trust professed by consumers. B. SERVICE QUALITY Parasuraman et al. (1994) defined service quality as the inconsistency between customers expectations for the service and their perceptions of service presentation, and this definition is expansively accepted. Gronroos (2001) described that the core characteristic of service is their process nature. Hence, service is a process that leads to a result during moderately concurrent production and consumption processes. Thus, it is more challenging for customers to assess service quality than good quality. In the service marketing literature, service quality is described as the consumer s judgment about the entity s total excellence or advantage. These airlines competitive benefit lies in their service quality as perceived by customers. Therefore, certifying quality service is the key for survival of all businesses and industries dealing in service offerings airlines comprehensive. C. PERCEIVED VALUE Parasuraman et al. (1985) described that only the consumer rather than the service supporter can appraise whether it is goods or service that gives value and the idea of perceived value of customers is a sense to be very individual and private. Woodruff (1997) stated that customer perceived value refers to what the customers believe they get from buying and using a product/service, and not to what companies believe their customers value. Swaddling and Miller (2002) defined perceived value as the prospective customer s evaluation of all the benefits and all the costs of an offering as compared to that customer s perceived alternatives. The equity concept refers to customer evaluation of what is fair, right, or deserved for the perceived cost of the offering. Perceived costs include monetary payments and non-monetary detriments such as time consumption, energy consumption, and stress experienced by consumers. D. CUSTOMER SATISFACTION Customer Satisfaction is an overall evaluation of performance based on all previous experiences with a firm. Bitner and Hubbert (1994) referred it to the consumer's overall satisfaction with the organization based on all encounters and experiences with that particular organization.

4 Cronin et al. (2000) defined customer satisfaction as the reflection from the customer to the organization based on their perception and their efficiency of service confrontation. This theory has changed the model of decision making from customers' viewpoint to the corporations viewpoint including affect and feeling. The method will prompt the level of customer satisfaction which consist of perception and efficiently reflect. Research Framework and Methodology A. Research Framework Base on previous empirical researches provided evidence. In the conceptual frame work, customer satisfaction, the dependent variable, is affected by four independent variables; airline image, service quality (in terms tangibles, reliability, responsiveness, assurance and empathy) and perceived value. The framework is shown in Fig.1. There were 7 hypotheses formulated based on the framework and they are shown as follows: H1: There is a statistical significant relationship between airline image and H2: There is a statistical significant relationship between service quality in terms of tangibles and H3: There is a statistical significant relationship between service quality in terms of reliability and H4: There is a statistical significant relationship between service quality in terms of responsiveness and H5: There is a statistical significant relationship between service quality in terms of assurance and H6: There is a statistical significant relationship between service quality in terms of empathy and H7: There is a statistical significant relationship between perceived value and

5 Fig. 1.The factors influencing customer satisfaction towards MAI airline in Yangon, Myanmar. B. Research Methodology The purpose of this research is to investigate the factors influencing customer satisfaction towards MAI airline in Yangon, Myanmar. This paper describes three independent variables which are airline image, service quality (in terms of tangibles, reliability, responsiveness, assurance, and empathy), perceived value and their effects toward the dependent variables, All 400 research questionnaires which were distributed to target population in Yangon, Myanmar. The questionnaires consisted of six sections that represent screening question, three independent variables, the dependent variable and demographic factors. The researcher applied judgment and convenience non-probability sampling. The researcher selected the descriptive research methodology instrument to evaluate each variable. This means that the outcome of the research would be described by examining the relationship between different variables. Sampling procedure The researcher applied the non-probability sampling method to find the sampling unit in this study. The probability sample is the process of probability sampling which is randomly chosen and non-probability sampling is the probability of a specific member of the population which is unknown

6 information for the researcher. The sampling unit is an individual component or group of components which point to the selection of the sample. The researcher in this study applied Judgment sampling and Convenience sampling to be the first step and the second step respectively; all details are as follows: Step 1: Judgment Sampling The judgment sampling or purposive sampling as a non-probability technique in which an experienced individual selected the sample based upon some appropriate characteristic of the sample members. The judgmental function expresses agreement (JA) or disagreement (JD) and it involves choosing objects/ samples that are believed will give accurate results. The researcher chose to conduct Judgment sampling on customers who have experienced with MAI airline in Yangon Myanmar. This sampling technique is the most suitable in research in which comprehensive population generalizations are not required. Step 2: Convenience Sampling Convenience sampling is the sampling method used to gather information from people who are most conveniently available and it also called accidental or haphazard sampling. Convenience samples are often used in exploratory and descriptive research where time and money are critical constraints. Convenience sampling is beneficial to obtain a large number of completed questionnaires quickly and economically. Therefore, most of the researchers generally use convenience sampling to obtain a large number of completed questionnaires quickly and economically. Research and Findings The hypotheses testing, is supported by the conceptual framework. There are a total of seven hypotheses which were tested in this research. Based on the research objectives, Correlation analysis was used in this study. After analyzing the hypotheses, all the null hypotheses were rejected. The results are summarized as follows:

7 Table1: Summary of hypotheses testing Hypothesis Statistical Test Significant H1 a : There is a statistical significant relationship between airline image and H2 a : There is a statistical significant relationship between service quality in terms of tangibles and H3 a : There is a statistical significant relationship between service quality in terms of reliability and H4 a : There is a statistical significant relationship between service quality in terms of responsiveness and H5 a : There is a statistical significant relationship between service quality in terms of assurance and H6 a : There is a statistical significant relationship between service quality in terms of empathy and H7 a : There is a statistical significant relationship between perceived value and Correlation Result Value Coefficient Correlation ** Reject H o Correlation ** Reject H o Correlation ** Reject H o Correlation ** Reject H o Correlation ** Reject H o Correlation ** Reject H o Correlation ** Reject H o Summary and conclusion The researcher concentrated on airline image, service quality (in terms of tangibles, reliability, responsiveness, assurance and empathy) perceived value and demographic factors for determining customer satisfaction based on the analysis data. Accordingly, the majority of all respondents were females, aged more than 30 year old, with the bachelor degree, with a monthly income of more than Ks and were self-employed fly between 3-5 times per year. For hypothesis testing, the data had been analyzed by using SPSS (statistical package of social science) to test the hypotheses and find the results for this research. The researcher investigated that among the (7) hypotheses, (5) hypotheses (H 2, H 3, H 4, H 6 and H 7 ) have a strong positive relationship between each variable which means that there is a strong positive relationship between service quality (in terms of tangibles, reliability, responsiveness, empathy ) and customer satisfaction, perceived value and The researcher also explored that the other (2) hypotheses (H 1 and H 5 ) have a moderately positive relationship between each other, which means that there is a moderately positive relationship

8 between airline image and customer satisfaction, service quality in term of assurance and customer satisfaction. RECOMMENDATIONS According to the data analysis of this study, the result can help marketers not only to understand Myanmar consumer s satisfaction with Myanmar airways international airline but also to gain more competitive advantages. Regarding the research findings, the answers from the questionnaires in this research paper, and based on the researcher s observations, the researcher would like to make some suggestions as follows; According to the result of hypothesis one, there is a moderately positive relationship between airline image and The result indicated that if the airline is image is high, customer satisfaction of the passengers also will be high. Customer satisfaction with the airline is one of the objectives of marketing activities linking the process of purchasing and consumption with post purchase phenomena. The researcher would like to suggest that to improve the service image of the airline they should advertise about the history of the airline and its luxuries, tidiness and comfort. With the best marketing channel and delivering the same on has been promised in the advertising, this can help build a strong image. According to the result of hypothesis two, there is a strong positive relationship between service quality in terms of tangibles and The result indicated that if the airline s service is good, customer satisfaction also will be high. The researcher would like to suggest that MAI airline should provide travelers with a good quality in-flight environment and seating facilities and also a good appearance, attitudes and uniforms of employees to increase the satisfaction of the customers. The airline marketers should know that employee s uniforms generally constitute an important component of an airline s brand identity. According to the result of hypothesis three, there is a strong positive relationship between reliability factors of service quality on The result indicated that if the airline s reliability is good, customer satisfaction will also be high. The researcher recommends that Myanmar Airways International airline should concentrate on more reliability of the airline. MAI airline should provide a good on-time performance of scheduled flights and remedial procedures for delayed or missing baggage to satisfy the travelers. They have to manage travelers transfers with good and efficient services.

9 According to the result of hypothesis four, there is a strong positive relationship between responsiveness factors of service quality on The result indicated that if the airline s service of responsiveness is high, customer satisfaction also will be high. The researcher recommends that MAI airways airport team should focus on having all their flights departure time and deplane on schedule, make every effort to offer the best available information concerning the duration of delays and the flight's anticipated arrival time, to the extent available. According to the result of hypothesis five, there is a moderately positive relationship between assurance factors of service quality on The result indicated that if the airline s service of assurance is good, customer satisfaction also will be high. Assurance is significantly and positively correlated with In order to improve assurance, the airline should be the space of sincere and be patient in resolving passengers problems. Airline employees should have a sincere and responsive attitude to passengers complaints and this certainly will increase customer satisfaction with the airline. The airline employees should also have sufficient knowledge and skillful services to offer them to travelers as well. Assurance, the dimension of service quality represents a significant and positive relationship with customers satisfaction. According to the result of hypothesis six, there is a strong positive relationship between empathy factors of service quality on The result indicated that if the airline s empathy is good, customer satisfaction will also be high. The researcher would like to suggest that the MAI airline s employees should provide good spontaneous care and concern for passengers needs. Moreover, doing well in frequent cabin service security checks and rounds by flight attendants can positively impact on The airline s customers are their most important asset and expect their requirements to be treated individually. According to the result of hypothesis seven, there is a strong positive relationship between perceived value and The result indicated that if customer perceived value is high, customer satisfaction will also be high. The findings of this study with regard to the influence of perceived value of customers on satisfaction are strongly consistent. The researcher would like to suggest to management that to provide the best amenities and best service to make customers have perceived high value which positively affects There was a significant positive influence of customer perceived value on

10 Further research For developing the results of this research, several further studies can be conducted. This investigation will support the airline industry. Similarly, the researcher would like to suggest other additional researches according to the study. The investigator studied only several specific variables. In this exploration, the researcher considered several independent variables, such as airline image, service quality (in terms of tangibles, reliability, responsiveness, assurance and empathy) and perceived value that influence the dependent variable, which is customer satisfaction. In further research, the investigators would like to utilize other independent variables that influence customer satisfaction, such as price, promotions and so on. In this study the researcher collected the data from MAI airline customers who were passengers of MAI airline only for international flights, and in the departure section at the international airport in Yangon, Myanmar. For future study, the researchers can select the data from MAI airline customers who are passengers of international flights in the arrival section at the international airport in Yangon, Myanmar. The researcher could not explore and conduct the survey at other airlines such as Thai Airways, Bangkok Airways, Nok Air and Air Asia due to the shortage of time. For future study, other researchers may study customer satisfaction of other international airlines or domestic airlines. The researcher studied about customer satisfaction with Myanmar Airways international airline in Yangon. In addition, the target market of this research is the customers of MAI airline, who experienced the services of this airline in Yangon, Myanmar. Future study, the researchers can select the markets of MAI airline customers who have no experience with MAI airline services as the target market, and study about the expectations and attitudes they may have about Myanmar Airways International in Yangon. Acknowledgment Firstly, I would like to express my deep gratitude to my dearest advisor, Assistant Professor Doctor SirionChaipoopirutana, for being my thesis advisor and for all her valuable advises while I was pursuing my thesis. Thanks for giving me a lot of ideas, patience, and encouragement throughout my thesis. Secondly, I would like to acknowledge the committee members who are namely Dr.ApichartIntravisit, Dr. RapeepatTechakittiroj and Dr. Aaron Loh. They helped me during my proposal time, in order to give me many beneficial recommendations to develop a better thesis, sharing their ideas and suggestions on the thesis. Thanks to the staff from graduate school of business and ABAC librarians who helped me throughout my research. I would like to thank my

11 friends and my classmates who have been supported me with encouragement, suggestions, laughter, and unforgettable memories all the way of my study. Last but not least, I am thankful to my parents who give life and unconditional love. My special words of thanks go to my dearest elder sisters Ms Mi Khin Aye, Mrs Mi Yin Aye and members of my family. I cannot find strong and suitable words that can cover my gratitude for your financial support and loving-kindness, unconditional love, trust, care and encouragement to make my dreams come true. It would not have been possible for me to finish without their constant support, motivation and help. Your help was much appreciated, thank you. REFERENCES Bitner, M.J. and Hubbert, A.R. (1994), Encounter satisfaction versus overall satisfaction versus quality, In Rust, R.T. and Oliver, R.L. (Eds), Service Quality: New Directions in Theory and Practice, Sage Publications, Thousand Oaks, CA, Chiang, C. & Jang, S. C. (2006). The effects of perceived price and brand image on value and purchase intention: Journal of Hospitality and Leisure Marketing, 15(3), Chitty, B., Ward, S. & Chua, C. (2007). An application of the ECSI model as a predictor of satisfaction and loyalty for backpacker hostels. Marketing Intelligence and Planning, 25(6), Cronin, J.J., Brady, M.K., & Hult, G.T.M. (2000). Assessing the effects of quality, value, and customer satisfaction on consumer behavioral intentions in service environments. Journal of Retailing, 76(2), Fornell, C. (1992), A national customer satisfaction barometer: the Swedish experience, Journal of Marketing, 56 (1), Grönroos, C. (2001). The perceived service quality concept a mistake?. Managing Service Quality, 11(3), Kotler, P. & Keller, K.L. (2012). Marketing Management, (14 th Edition). Pearson Prentice Hall. Kandampully, J. (2000). The impact of demand fluctuation on the quality of service: tourism industry example. Managing Service Quality, 10 (1), Keller, K.L. (1993), Conceptualizing, measuring, and managing customer-based brand equity, Journal of Marketing, 57, 1-22.

12 Lee, M.,Lee, C. & Wu, C. (2009). Brand image strategy affects brand equity after MandA. European Journal of Marketing, 45(7/8), Monroe, K.B. (1973), Buyers subjective perceptions of price, Journal of Marketing Research, 10(February), Park, C. Whan, Bernard J. Jaworski, and Deborah J. Maclnnis (1986) "Strategic brand concept image management." The Journal of Marketing: Parasuraman et al.(1994) Reassessment of wxpectations as as a comparison standard in measuring service qulaity: implications for future research. Journal of Marketing 58: Parasuraman, A., Zeithaml, V. and Berry, L. (1985), ``A conceptual model of services quality and its implications for future research'', Journal of Marketing, 49(Fall), Schulz R.N (2012). The effects of business image on customer retention in hotels in Eldoret. Swaddling, D.C. & Miller, C. (2002), Don't measure Quality Progress, 35 (5), 62. Woodruff, R.B. (1997), Customer value: the next source for competitive advantage,journal of the Academy of Marketing Science, 25 (2), Zeithaml, V.A. (1988), Consumer perceptions of price, quality and value: a means-end model and synthesis of evidence, Journal of Marketing, 52(July), 2-22.

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