Keywords: Customer satisfaction, service quality, airline industry ... specific care to customers' dissatisfactions, which vary from departure services (i.e. ticketing,.
Investigating the effect of service quality dimensions on passengers’ satisfaction in the Greek airline industry
Ioannis Chaniotakis Hellenic Open University Greece Maria Salamoura University of the Aegean Chios, Greece Constantine Lymperopoulos University of the Aegean Chios, Greece Angelos Pantouvakis University of Ioannina Greece
Abstract The aim of this paper is to investigate the relationship between passengers’ attitudes towards service quality dimensions and their overall satisfaction within the airline industry. Based on a sample of 300 respondents, a survey was conducted in order to analyze the service quality dimensions of two major Greek airline companies. Factor and cluster analysis have been used for the statistical analysis of the results. More specifically, the service quality dimensions could categorized in six distinct factors, namely “employees of ground services”, “flight attendants”, “price”, “added value services”, “reliability” and “accessibility”. In conclusion, customers’ perceptions about the effect of these six factors on satisfaction is affected by demographical criteria such as their gender, age, education and income, resulting thus in different customer segments. Keywords: Customer satisfaction, service quality, airline industry Track: Tourism Marketing
Investigating the effect of service quality dimensions on passengers’ satisfaction in the Greek airline industry
Abstract The aim of this paper is to investigate the relationship between passengers’ attitudes towards service quality dimensions and their overall satisfaction within the airline industry. Based on a sample of 300 respondents, a survey was conducted in order to analyze the service quality dimensions of two major Greek airline companies. Factor and cluster analysis have been used for the statistical analysis of the results. More specifically, the service quality dimensions could categorized in six distinct factors, namely “employees of ground services”, “flight attendants”, “price”, “added value services”, “reliability” and “accessibility”. In conclusion, customers’ perceptions about the effect of these six factors on satisfaction is affected by demographical criteria such as their gender, age, education and income, resulting thus in different customer segments. Keywords: Customer satisfaction, service quality, airline industry
1. Introduction It is well known that in services every interaction between the service provider and the final customer is a “moment of truth” (Carlzon, 1987). As a result, customer satisfaction is a function of the difference between expected and perceived service (Grönroos, 1982; Parasuraman et al., 1985, 1988). Consumer satisfaction is what guarantees the future of airlines, if the airline industry aims to gain or expand market share against continuously increased competition, either regionally or globally (Lapré & Scudder, 2004). This can be easily noticed by taking into account passengers’ complaints about airline quality such as flight problems, fares, reservations, tours etc. That’s why airline industries should take specific care to customers’ dissatisfactions, which vary from departure services (i.e. ticketing, transfer), in-flight services (i.e. catering, air crew behavior) and services provided at the end of the journey (i.e. transfer or accommodation packages. It is obvious, that airline industries should consider several ways of managing these problems such as employees’ training, processing refunds and resolving complaints. Finally, the fact that seasonal parameters such as weather or holiday will affect airline service quality, making thus customer satisfaction more complex, should be seriously taken into account. It is obvious that a better understanding of the factors affecting service quality is a prerequisite for the analysis of service quality dimensions. Taking into account that customers have different motivations in their buying behaviour, it is important to segment them and focus on different segments’ attitudes. In this context, it is of great interest to shed more light into how
customers perceive service quality in the airline industry and how attitudes towards service 2
quality dimensions of different segments influence their relative attitudes towards their overall satisfaction. More specifically, the current study aims not only to explore the service quality dimensions for airline companies in Greece, but also tο use demographics in order to better understand airline customers’ attitudes towards these dimensions. After this brief introduction, a review and discussion of the relevant literature is included, followed by the research objectives and methodology, as well as the findings from a customer survey. Finally, the conclusions and implications for managers are presented.
2. Literature review 2.1 Customer satisfaction and service quality For more than three decades, the concept of customer satisfaction has drawn the interest of a significant number of researchers, either defined as an outcome (Vavra, 1997) or a process (Oliver, 1977, 1981; Tse and Wilton, 1988), one depending on the other. In addition, attention has been given to the cumulative satisfaction approach, or the transactional satisfaction approach – satisfaction over time or in a single transaction with a product or a service respectively (Boulding et al., 1993). Because definitions of customer satisfaction vary in the number of components they include and the details they provide, Giese and Cote (2002), by reviewing the conceptual and operational definitions in consumer satisfaction literature, proposed a framework for developing context-specific definitions of consumer satisfaction. They conclude that “consumer satisfaction is a summary affective response of varying intensity, with a timespecific point of determination and limited duration, directed toward focal aspects of product acquisition and/or consumption” (Giese and Cote: 2002:15), components in which the researcher will need to provide details. Customer satisfaction is usually associated with price satisfaction. Matzler, Wurtele and Renzl (2006), argued that when monitoring customer satisfaction managers should consider six price satisfaction dimensions, namely price transparency, price-quality ratio, relative price, price confidence, price reliability and price fairness. In other words, overall price satisfaction can be conceptualized as a multi-dimensional construct of the aforementioned dimensions, which in turn will affect word-of-mouth and switching intentions. The connection of customer satisfaction with service quality may be explained by the fact that they are both functions of customers’ expectations and their perceptions of the service performance – what the customer expects and actually perceives to be treated respectively (Berry et al., 1988). In this context, Parasuraman et al. (1988) defined service quality as an organizations’ ability to meet or even exceed customer’s expectations, resulting in the most widely accepted service quality measure, called SERVQUAL. The scale measures service quality in five dimensions, namely tangibles, reliability, responsiveness, assurance and empathy, and is applicable to a wide range of service industries (McAlexander et al., 1994). Similarly, Powpaka (1996) examined the significance of outcome quality attributes - what the customer actually receives from the service transaction - and/or process quality attributes - the manner the service is delivered to the customer - in the definition of quality, across service industries. Many authors introduced other service quality models, like Grönroos (1988, 1990, 2001) who added a sixth dimension – recovery, while his later conceptualization summarizes service quality in three dimensions: not only the functional quality of the service – as
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described by SERVQUAL – but also the technical quality of the outcome and the company corporate image, which are more difficult to define and measure (Kang and James, 2004). 2.2 Service quality in the airline industry Given the fact that service quality is a multidimensional construct, many attempts have been made to study the aforementioned difference between passenger expectations and perceptions of airline service. Concerning the service elements, airlines is a typical paradigm of direct and indirect service elements (Davis & Stone, 1985), also known as core and secondary attributes (Lovelock, 1985), essential and subsidiary (Lewis, 1987), or functional and performance delivery. More specifically, airline customers are being engaged in a number of activities such as making reservations, being checked, receiving flight services or retrieving their baggage at the destination airport. Although these activities are secondary compared to the core product, which involves the transportation of passengers and luggage to the final destination, customer satisfaction or dissatisfaction has a greater potential to be generated if service quality in the delivery of the above activities is absent. Chen and Chang (2005) claimed that a chain of services is included in airline industry, incorporating a series of processes, starting from airline ground services (i.e. information gathering, ticket purchases, check-in procedures, etc.) to in-flight services (i.e. on board security, in-flight telecommunication facilities, cabin crew responses, etc.). Babbar and Koufteros (2008) listed a number of factors determining the human element in airline service quality, emphasizing in ways for contact the personnel and the customer personal touch. Particularly, the results of this survey data have shown that the satisfaction level of US airlines’ passengers is determined by an important set of factors constituting the dimension of personal touch, namely attention, helpfulness, courtesy, and promptness, enabling thus the better quality management in airlines. Chiu & Lin (2004) achieved a service quality measurement derived from the theory of needs. In particular, they tried to correlate the categories of tourist’s needs as a passenger and their content of airline service quality, in order to understand what passengers really need and then deliver the appropriate level of service accordingly. Martin-Conseurga, Molina & Esteban (2007), conducted an empirical analysis in the service sector by using an integrated model of price, satisfaction and loyalty. By investigating the direct and indirect effects of customer satisfaction – through loyalty – on price acceptance, the authors utilized a model which examines the consumer behavior procedure regarding the above variables, resulting from individuals’ perceptions of price fairness that underlie their transactions with airlines. Robledo (2001) investigated the role of integrating customer expectations in measuring and managing service quality. More specifically, by comparing four different methods for measuring service quality within an airline setting, the study shown that there is a relationship between service quality and expectations, which in turn may be affected by different sources (i.e. past experience, formal/informal recommendations, price). Finally, Abdila, Mohamed and Mekawy (2007) conducted an empirical analysis of the Egyptian airline sector in order to investigate tourist’s needs and expectations. More specifically, they used SERVQUAL model to measure perceived airline service quality from the passenger’s viewpoint. According to the above findings, service quality in the airlines industry is a multidimensional variable. More specifically, apart form the well researched SERVQUAL dimensions, service quality is researched in the base of more specific factors such as “airline ground services” (Chen and Chang, 2005), “in-flight services” (Chen and Chang, 2005), “personnel” (Babbar and Koufteros, 2008), and “price acceptance” (Martin-Conseurga et.al.,
4
2007). In addition, there is a gap in the literature, concerning the exploitation of the airline customers’ attitudes towards service quality, which will be used as a basis for segmenting the market and focusing on the most important dimensions for each segment’s overall satisfaction.
3. Research objectives and methodology Based on the literature review, the main objectives of this paper are: ¾ To explore the dimensions of service quality for the airline companies in Greece. ¾ To investigate Greek airline customers’ attitudes towards the dimensions of service quality. Thus, a survey was designed and conducted in Athens International Airport and Chios Airport, between September and December 2008. The target population comprised of 300 adult airline passengers, both men and women, of various ages, using stratifying sampling. The scales used in previous studies provided the basis for developing the research questionnaire, which was administered by personal interviews. As seen in table 1, the questionnaire, which was in Greek, contained a set of 37 questions related to various aspects of airline service quality dimensions. Authors concluded to the final items of the construct based on the SERVQUAL
model (Parasuraman et al., 1988), as well as on the research constructs for the service quality measurement in the airlines sector mentioned in the literature review. It should be noted that a special attention was paid to the “price factor” which, according to the literature, is often neglected. In addition to the questions related to service quality, respondents were asked about the level of their overall satisfaction and their willingness to have a positive Word of Mouth (“recommend this airline to their friends and relatives”). For the measurement of all those items a seven-point Likert-scale was used (-3 : strongly disagree to +3 : strongly agree).
4. Analysis of results For the questionnaire analysis, data factor analysis was performed (principal components factor analysis with varimax rotation), using the SPSS 16 software. According to the findings, six distinct factors, namely “employees of ground services”, “flight attendants”, “price”, “added value services”, “reliability” and ‘accessibility’, were identified using the Kaizer criterion, i.e. having an eigenvalue higher than one. The six factor solution was adopted in order to create a meaningful scale, since no other factor with an eigenvalue greater than one emerged, and those with eigenvalues smaller than one contained only isolated items, rather than a group. The six factors explained 63.124 per cent of total variance (see table 1). More specifically the“employees of ground services” factor explained 35.036 per cent of the total variance, “flight attendants” factor 8.362 per cent, “price” factor 7.306 per cent, “added value services” factor 4.886 per cent, “reliability” factor 3.966 per cent and “accessibility” factor 3.568 per cent. As it could be seen in diagram 1, factor scores were analysed using various demographic dimensions (e.g. gender, age, education, income) as dependent variables. In order to accentuate the dimensions expressed by each factor, only questions with loadings over 0.50 were included in the formulation of scales, which were converted to standard ten scores (sten) using the formula z*2 + 5.5, giving thus a minimum score of 1 and a maximum of 10 with 5.5 standard deviation.
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Diagram.1 5,700
6,30000
5,650
6,10000
5,600
5,90000 5,70000
5,550
up to 24 Men
5,500
25 to 56
5,50000
Women
57+
5,450
5,30000
5,400
5,10000
5,350
4,90000 4,70000
5,300 Ground
Flight
Price
Add Value
Reliability
Ground
Accesibility
6,000
Flight
Price
Add Value Reliability Accesibility
5,900 5,800
5,800 5,700
5,600
5,600
Up to Lyceum Graduate
5,400
Postgraduate 5,200
up to 1000 euro
5,500
1001-2500 euro 5,400
more than 2501 euro
5,300 5,200
5,000
5,100
ty
ilit y Ac ce si b
ia bi li R el
V al ue A dd
Pr ic e
Fl ig ht
G ro un d
y ilit Ac ce sib
ia bi lity Re l
Va lu e Ad d
Pr ice
ig ht
5,000
Fl
G ro un d
4,800
Gender According to Figure 1, there is evidence that there are significant differences between men’s and women’s perceptions towards the satisfaction for each service quality dimension. In particular, men are more satisfied by human factors of the airline services (“employees of ground services” and “flight attendants”) as well as the “reliability” of the company. In the contrary, women focused mainly on the “added value services”. Age For convenience of analysis, three age groups were set. The first group consists of passengers below the age of 25, the second group from 25 to 56 years old and the third group over 56 years old. The younger passengers are more satisfied by the “flight attendants”, the “price” and the “reliability”. The elderly group of passengers places a special emphasis to the “employees of ground services” as well as the “accessibility”. Finally, the middle group is more satisfied with the “added value services”. Education Based on the education level, three groups were set for the purpose of the analysis. The first group consists of passengers who have finished the Lyceum or has a lower level of education, the second group has graduate studies and the third group postgraduate ones. The first group of passengers is more satisfied with the “price” and the “added value services”, while the second and the third group with the “employees of ground services” and the “reliability”. Income Three groups were set based on the family income. The first group consists of passengers with a low income (up to 1,000€), the second with medium (from 1,000€ up to 2,500€) and the third with higher one (more than 2,500€). Passengers with low income are more satisfied with the human factors of the airline services (“employees of ground services” and “flight attendants”) as well the “price”. In the contrary, those passengers with the higher
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income are mainly satisfied by the “added value services”, the “reliability” and the “accessibility”. Finally, the medium group seems to prefer the “price” factor.
5. Conclusions and implications for managers The aim of this paper was to investigate how customers perceive service quality in the airline industry and how these attitudes towards service quality dimensions of different segments influence their relative attitudes towards their overall satisfaction. More specifically, the service quality dimensions could be categorized in six distinct factors, namely “employees of ground services”, “flight attendants”, “price”, “added value services”, “reliability” and “accessibility” (see Table 1). In addition, the current study used demographics in order to better understand Greek airline customers’ attitudes towards these dimensions, and consequently segment the market and focus on the most important dimensions for each segment’s overall satisfaction. Data analysis suggested that customers emphasizing in the “employees of ground services” factor are men, belonging in the age group of over 56 years old, with graduate or postgraduate studies. Similarly, customers emphasizing in the “flight attendants” factor are men, belonging to the age group below 25 years old, with low income. Concerning the “price” factor, younger passengers with lower education and low or even medium income pay more attention to this variable. The “added value services” factor is more important for women, belonging to the age group of 25 to 56 years old, with lower education and higher income. In addition, “reliability” is more important for younger passengers, mainly men, with graduate or even postgraduate studies, and higher income. Finally, the elderly group with higher income places a special emphasis to the “accessibility” factor. These findings could be useful to managers involving in airline industry, in the way that they would better diagnose passengers’ expectations about service quality and satisfaction. What the findings suggest for managers is that they should deliver their service accordingly to passengers’ expectations. By focusing on the most important dimensions for each segment’s overall satisfaction, the proper communication strategies could be designed. In other words, managers could emphasize in the most important attributes of airline service quality, containing at the same time those attributes which are indifferent to the consumer, without neglecting the fact that multiple service quality dimensions should be offered, when providing their airline services.
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References Abdlla, G., Mohamed, A.R. & Mekawy, M.A. (2007). Managing Tourist’ Needs and Expectations: An Empirical Analysis of the Egyptian Airline Sector. Tourism, 55(3), 277-296. Babbar, S. & Koufteros, X. (2008). The Human Element in Airline Service Quality: Contact Personnel And The Customer. International Journal of Operations & Production Management, 28(9), 804-830. Berry, L.L., Parasuraman, A. & Zeithaml, V.A. (1988). The Service Quality Puzzle, Business Horizons, 31(5), 35-43 Boulding, W., Kalra, A., Staelin, R. & Zeithaml, V.A. (1993). A Dynamic Process Model of Service Quality: From Expectations To Behavioral Intentions. Journal of Marketing Research, 30(February), 7-27. Carlzon, J. (1987). Moments of truth. Cambridge, Mass: Ballinger Pub. Co Chen, F. & Chang, Y. (2005). Examining Airline Service Quality from a Process Perspective. Journal of Air Transport Management, 11(2), 79-87. Chiu, H & Lin, N. (2004). A Service Quality Measurement Derived from the Theory of Needs. The Service Industries Journal, 24(1), 187-204. Davis, B., & Stone, S. (1985). Food and Beverage Management, 2nd ed. Oxford: Butterworth- Heinemann. Giese, J.L. & Cote, J.A. (2002). Defining Consumer Satisfaction. Academy of Marketing Science Review, 2000(1). Available from http://www.masereview.org/articles/giese012000.pdf Grönroos, C. (1982). Strategic Management and Marketing in the Service Sector. Helsinki: Swedish School of Economics and Business Administration Grönroos, C. (1988). Service Quality: The Six Criteria Of Good Perceived Service Quality. Review of Business, 9(3), 10-13. Grönroos, C. (1990). Service Management and Marketing: Managing the Moments of Truth in Service Competition. Lexington, MA: Lexinghton Books Grönroos, C. (2001). The Perceived Service Quality Concept – A Mistake? Managing Service Quality, 11(3), 150-152(3). Kang, G.D. & James, J. (2004). Service Quality Dimensions: an Examination of Grönroos’s Service Quality Model. Managing Service Quality, 14(4), 266-277. Lapré, M.A. &. Scudder, G.D. (2004). Performance improvement paths in the U.S. airline industry: Linking trade-offs to asset frontiers. Production and Operations Management, 13(2), 123-134. Lovelock, C.H (1985). "Developing and Managing the Customer-Service Function in the Service Sector". In J.A. Czepiel, M.R.Solomon, C.F. Suprenant & E.G. Gutman (Eds.), The Service Encounter: Managing Employee Customer Interaction in Service Business (pp.265-80). Lexington Books, Lexington, MA, Lewis R.C. (1987). The Measurement of Gaps in the Quality of Hotel Services. International Journal of Hospitality Management, 6(2) pp. 83-88. Martin-Conseurga, D., Molina, A. & Esteban, A. (2007). An Integrated Model of Price, Satisfaction and Loyalty: An Empirical Analysis in the Service Sector. Journal of Product & Brand Management, 16(7), 459-468. Matzler, K., Wurtele, A. & Renzl, B. (2006). Dimensions Of Price Satisfaction: A Study In The Retail Banking Industry. International Journal of Bank Marketing, 24(4), 216231. McAlexander, J.H., Dennis, O. & Koenig, H.F. (1994). Service Quality Measurement. Journal of Health Care Marketing, 14(3).
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Oliver, R.L (1977). "Effects of expectation and disconfirmation on post-exposure product evaluations: an alternative interpretation". Journal of Applied Psychology, 62(4), 48086. Oliver, R.L. (1981). Measurement and Evaluation of Satisfaction Process in Retail Setting. Journal of Retailing, 57(Fall), 25-48. Parasuraman, A., Zeithaml, V.A. & Berry, L.L.(1985). A Conceptual Model of Service Quality and its Implications for Future Research. Journal of Retailing, 49(Autumn), 41-50. Parasuraman A., Zeithaml, V.A. & Berry, L.L (1988). SERVQUAL : a Multiple-Item Scale For Measuring Consumer Perceptions of Quality. Journal of Retailing, 64(Spring), 1240. Powpaka, S. (1996). The Role of Outcome Quality as a Determinant of the Overall Service Quality in Different Catergories of Service Industries : an Empirical Investigation. Journal of Services Marketing, 10(2), 5-25. Robledo, M.A. (2001). Measuring and Managing Service Quality: Integrating Customer Expectations. Managing Service Quality, 11(1), 22-31. Tse, D.K. & Wilton, P.C. (1988). Models of Consumer Satisfaction: an Extension. Journal of Marketing Research, 25(May), 204-212. Vavra, T.G (1997), Improving Your Measurement of Customer Satisfaction: A Guide to Creating, Conducting, Analyzing, and Reporting Customer Satisfaction Measurement Programs, ASQ Quality Press.
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Appendix: Table 1. Factors related to customer satisfaction with the airline 1. 2. 3. 4 5. 6. 7. 8. 9. 10. 11. 12. 13. 14 15. 16. 17. 18. 19. 20. 21. 22. 23. 24 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37.
This airline’s ground employees provide individual attention to customers This airline’s ground employees give you prompt service The ground employees of this airline understand what the specific needs of their passengers are This airline’s ground employees are helpful when flights are delayed This airline’s ground employees direct customers with problems to the proper level of authority This airline’s ground employees have the knowledge to answer all passengers’ questions You can easily find this airline’s ground employees when you need them This airline’s ground employees apologise in case of mistake This airline’s ground employees are quick and flexible in solving passengers problems This airline’s ground employees are never too busy to respond to your request or complaint This airline’s flight attendants checking with passengers from time to time if they need anything This airline’s flight attendants are able to deal with an extraordinary situation during the flight This airline’s flight attendants understand customers’ needs This airline’s flight attendants are always willing to provide any information related to the flight This airline’s flight attendants give you confidence This airline’s flight attendants are pleasant This airline’s flight attendants are courteous This airline’s pricing is transparent The relationship between quality of the service and the cost of the ticket was very good Considering the price of the ticket and the quality of service I believe that I get “value form my money” by using this airline The price of the ticket was better than other airlines’ ones The price of the ticket is according to my expectations I paid a fair price for the airline ticket This airline has in-flight entertainment facilities Airline providing special services for the elderly. disabled. and families with small children This airline has comfortable waiting lounges This airline provides internet. e-mail and fax services This airline has an effective handling of the luggage This airline makes you feel safe This airline provides good ground/in-flight services This airline’s flight departs and arrives at time it promises This airline has convenient flight schedules and enough frequencies This airline’s aircrafts are have a modern appeal and they have clean and comfortable interiors and seats This airline provides quality food and beverages This airline has an easy and flexible system for buying tickets This airline’s check in is quick This airline’s check in is flexible – Check in may be done through internet or self service machines in the airport Explained variance per factor (%) Explained variance – total (%)
F-1 0.693
F-2 0.105
F-3 0.122
F-4 0.134
F-5 0.330
F-6 0.056
0.754 0.734
0.104 0.083
0.088 0.101
0.099 0.129
0.313 0.298
0.016 -0.038
0.752
0.104
0.153
0.054
0.208
0.070
0.661
0.186
0.149
0.096
0.190
0.117
0.672
0.266
0.000
0.137
0.123
0.239
0.726
0.176
0.150
0.158
-0.012
0.151
0.659 0.668
0.224 0.107
0.106 0.208
0.150 0.241
-0.215 -0.061
0.405 0.166
0.566
0.041
0.294
0.204
0.118
0.121
0.143
0.641
0.164
0.295
0.231
0.075
0.231
0.649
0.152
0.280
0.153
0.002
0.200
0.742
0.210
0.146
0.201
0.119
0.218
0.706
0.248
0.190
0.102
0.146
0.147 0.102 0.092 0.138
0.815 0.791 0.756 0.321
0.190 0.276 0.187 0.587
0.205 0.104 0.171 0.010
0.070 0.021 0.065 -0.064
0.150 0.201 0.074 0.242
0.326
0.210
0.716
0.080
0.126
0.140
0.072
0.183
0.833
-0.013
0.081
0.144
0.110 0.203 0.174 0.094
0.256 0.174 0.142 0.182
0.819 0.802 0.745 0.120
0.091 0.155 0.111 0.727
0.112 0.100 0.104 0.285
0.039 0.062 0.102 -0.012
0.169
0.281
0.029
0.667
0.063
0.054
0.144 0.184 0.247 0.174 0.257 0.277
0.144 0.181 0.191 0.323 0.237 0.027
0.072 0.104 -0.028 0.045 0.132 0.145
0.766 0.728 0.572 0.129 0.193 0.117
0.014 0.076 0.253 0.510 0.651 0.783
0.086 0.096 0.132 0.233 0.132 -0.019
0.277
0.001
0.121
0.364
0.548
0.316
0.168
0.282
0.041
0.361
0.511
0.174
0.126
0.235
0.175
0.484
0.375
0.153
0.176
0.174
0.231
0.060
0.120
0.792
0.181
0.206
0.182
0.104
0.143
0.754
0.207
0.128
0.133
0.176
0.158
0.711
35.036
8.362
7.306
4.886
3.966
3.568
35.036
43.398
50.704
55.590
59.556
63.124
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