The Effects of Trust, Service Quality and Perceived Value on

Satisfaction and Their Impact on Loyalty

Rico

, Melitina Tecoalu

, Soegeng Wahyoedi

and Eka Desy Purnama

Master of Management, Krida Wacana Christian University, Indonesia

Faculty of Economics and Business, Krida Wacana Christian University, Indonesia

Keywords: Trust, Service Quality, Perceived Value, Satisfaction, Loyalty.

Abstract: The purpose of this research is to analyse the effect of trust, service quality and perceived value on

satisfaction and their impact on customer loyalty. The samples of this research are 115 customers, and the

questionnaire uses the method of data collection from the respondents chosen by the non-probability

sampling method and purposive sampling technique. The data analysis technique which was used was

quantitative analysis using Structural Equation Modelling (SEM) and Partial Least Squares (PLS). The

results of the analysis demonstrate that Trust, Service Quality, and Perceived Value have a positive and

significant effect on customer satisfaction. Satisfaction has a positive influence on customer loyalty and is

an intervening variable that has a positive and significant impact on customer loyalty. Trust and Perceived

Value have a positive effect on customer loyalty, while Service Quality does not have a positive effect on

Loyalty directly.

1 INTRODUCTION

The use of the internet network as digital promotion

media to perform a range of economic activities,

especially marketing, is called electronic commerce

or e-commerce. E-commerce is an activity of

conducting business transactions online through

media and devices integrated with the internet.

Laudon (2012) explains that e-commerce refers to

the use of the internet and websites for business

transactions.

The e-commerce market in Indonesia has high

prospect, which is evident by the growing number of

active internet users in Indonesia leading to an

increase in e-commerce sites both domestically and

from abroad. This adds to the difficulty of

competing e-commerce businesses in maintaining e-

commerce sites/websites in Indonesia. To be able to

succeed in an online business, a service strategy

focused on the customer is required.

Every e-commerce site/website attempts to

provide the best offer and shopping experience for

its customer satisfaction by maintaining the

customer loyalty. Customer loyalty in online

business is not only able to be measured through

product quality, but also through the transaction

experience on the site as a whole, from ordering to

the arrival of goods to the customers. Online buyers

tend to be very critical as they can easily compare

prices and product specifications from one site to

another; hence, ordering and purchasing can simply

occur in a few clicks.

1.1 Research Problems

An intensely tight competition with numerous

similar competitors in the e-commerce business

world is the toughest challenge for Tokopedia to

retain its current customers and attract new

consumers to conduct online buying and selling

services through Tokopedia. Referring to this matter,

the problem formulations of this research are as

follows:

1) Does Trust have an effect on Satisfaction?

2) Does Service quality have an effect on

Satisfaction?

3) Does Perceived Value have an effect on

Satisfaction?

4) Does Satisfaction have an effect on Loyalty?

5) Does Trust have an effect on Loyalty?

6) Does Service quality have an effect on Loyalty?

7) Does Perceived Value have an effect on Loyalty?

Rico, ., Tecoalu, M., Wahyoedi, S. and Purnama, E.

The Effects of Trust, Service Quality and Perceived Value on Satisfaction and Their Impact on Loyalty.

DOI: 10.5220/0008492603250330

In Proceedings of the 7th International Conference on Entrepreneurship and Business Management (ICEBM Untar 2018), pages 325-330

ISBN: 978-989-758-363-6

325

1.2 Research Objective

This research aims to analyze the effects of Trust,

Service Quality and Perceived Value on customer

satisfaction and their impact on customer loyalty.

2 LITERATURE REVIEW

2.1 Trust

Morgan and Hunt in (Akbar and Parvez, 2009: 26)

stated that “trust exists only when one party has

confidence in an exchange of partner's reliability and

integrity". Furthermore, trust is defined as a

condition when one of the parties involved in the

exchange process is convinced of the other party’s

reliability and integrity. Consumer confidence is

basically the consumers’ entire knowledge and

conclusions made on objects, attributes, and benefits

(Mowen and Minor, 2002: 312).

2.2 Service Quality

Service quality is defined by Zeithaml et al., (2013)

as the ability of website to provide effective and

efficient product shopping, payment and delivery

experience. Service quality dimensions, according to

Wolfinbarger and Gilly (2003), consist of website

design, reliability, security, and customer service.

Service quality includes the suitability of goods or

services purchased, shipping, and website

maintenance (whether the website loads quickly,

whether the payment system is safe and reliable,

whether customer service is friendly, etc.).

Meanwhile, according to Arief (2006), service

quality is the expected level of excellence and

control over the level of excellence to meet customer

needs.

2.3 Perceived Value

Kotler (2003: 60) states that "Customer perceived

value is the difference between the prospective

customer evaluation of all the benefits and all the

costs of an offering and perceived alternatives".

Zeithaml (1988, in Sanchez and Iniesta, 2007)

proposed 4 criteria of perceived value definition; i.e.

low prices, things on products desired by consumers,

quality obtained from products based on the prices

offered, and what consumers receive from what they

give (benefit and sacrifice).

2.4 Satisfaction

Customer satisfaction is a comparison between

customer expectation and the perceived quality

(Kotler, 2000). Customer satisfaction is also defined

as a deep commitment to re-purchase or subscribe to

a product or service consistently in the future to the

same brand, despite the influence of situation and

marketing efforts potentially causes the switching

behavior (Jamal and Anastasiadou, 2009).

2.5 Loyalty

Customer loyalty in an online context is defined as a

commitment to continue purchasing certain products

and a tendency to consistently do word of mouth

communication in the future (Chang et al., 2009).

Furthermore, Griffin (2005) argued that loyal

customers are customers who: repurchase regularly

(repeat buyers), repurchase the same product or

service offered by the company, purchase across

product and service lines, refer the product or

service to others, communicate by word of mouth

regarding the product or service to others, and

demonstrate immunity to the full of competitions.

2.6 Conceptual Framework

H1 H5

H2 H4

TRUST

SERVICE

QUALITY

PERCEIVED

VALUE

SATISFACTION

LOYALTY

2.7 Hypotheses

H1: Trust has an effect on Tokopedia’s customer

Satisfaction

H2: Service quality has an effect on Tokopedia’s

customer Satisfaction

H3: Perceived Value has an effect on Tokopedia’s

customer Satisfaction

H4: Satisfaction has an effect on Tokopedia’s

customer Loyalty

H5: Trust has an effect on Tokopedia’s customer

Loyalty

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H6: Service quality has an effect on Tokopedia’s

customer Loyalty

H7: Perceived Value has an effect on Tokopedia’s

customer Loyalty

3 RESEARCH METHOD

3.1 Objects of Research

The object in this study is the loyalty of Tokopedia

customers, with Satisfaction as an intervening

variable. Satisfaction is a dependent factor that is

derived from Trust, Service Quality and Perceived

Value as independent factors of Tokopedia

customers. The research also looks at how big the

impact is.

3.2 Population and Samples

The population covers Tokopedia e-commerce

customers who have purchased products in

Tokopedia at least 2 (two) times. Meanwhile, the

number of samples is based on Hair et al., (2010)

who suggested that the total number of sample size

should be at least 100-200 samples with 5-10 in each

indicator or estimated parameter. Therefore, in

fulfilling these requirements, the number of samples

is set at 115. The sample selection method utilizes

non probability sampling method with purposive

sampling technique.

3.3 Data Analysis Technique

The data analysis technique used is quantitative

analysis by using smart PLS. Furthermore, analysis

is carried out on the outer model evaluation, inner

model evaluation, path analysis, and hypothesis of

mediation/indirect influence testing.

4 ANALYSIS AND DISCUSSION

4.1 Measurement Model Testing

(Outer Model)

The measurement model aims to test the accuracy of

the relationship between indicators in a variable in

measuring the latent variables. Testing of the

measurement model consists of: convergent testing

and discriminant validity, as well as composite

reliability testing.

Figure 1: Outer Model.

4.2 Validity Test

The validity test aims to measure the accuracy of

indicators in measuring the latent variables.

According to Ghozali (2008), an indicator is

considered valid if it has a loading factor above 0.70.

All loading factors of the indicators are above 0.7.

Hence, it can be concluded that all indicators are

valid.

4.3 Reliability Test

Reliability of a variable is measured based on the

values of cronbach alpha and composite reliability

greater than 0.7 (Hair et al, 2010: 157).

Table 1: Composite Reliability Value.

Composite Realiability Cronbachs Alpha

L 0,919 0,882

PV 0,868 0,798

S 0,891 0,816

SQ 0,872 0,816

T 0,808 0,723

All variables in this research have composite

reliability and Cronbach alpha values above 0.7.

Thus, all variables in this research are reliable.

4.4 Structural Model Testing (Inner

Model) – Hypothesis Test

The structural model (inner model) in this research

consists of three exogenous latent variables (trust,

service quality, perceived value) and two

The Effects of Trust, Service Quality and Perceived Value on Satisfaction and Their Impact on Loyalty

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endogenous latent variables (satisfaction and

loyalty).

Table 2: Path Coefficients.

Original

Sample

Mean

Standard

Deviation

Standard

Error

T Statistics

PV-L 0,458205 0,463466 0,093018 0,093018 4,925963

PV -S 0,17381 0,170467 0,104642 0,104642 2,66099

S - L 0,369324 0,367367 0,130187 0,130187 5,66197

SQ -L 0,113986 0,11152 0,131142 0,131142 0,86918

SQ -S 0,702024 0,703126 0,104892 0,104892 6,6928

T - L 0,586199 0,583746 0,030084 0,030084 2,0020

T -S 0,520436 0,520032 0,020624 0,020624 3,6028

4.5 Hypothesis 1. The Effect of Trust

on Satisfaction

The effect of trust (T) on satisfaction (S) shows that

the t-statistic value of 3.602 is greater than the t-

table which is 1.960. This means the first hypothesis

is accepted.

Trust has a positive influence on customer

satisfaction, namely: Tokopedia continues to

increase trust as a trusted third party (online

shopping intermediary media) by ensuring the

confidentiality of users' personal data. Their data is

safely maintained so that customer accounts are not

hijacked by other people. Tokopedia must be more

anticipative and selective about the potential store

seller who wants to commit fraud with various types

of covert frauds, such as issuing strict administrative

requirements and requiring clear account

accreditation data.

4.6 Hypothesis 2. The Effect of Service

Quality on Satisfaction

The effect of service quality (SQ) on satisfaction (S)

shows that the t-statistic value of 6.692 is greater

than the t-table which is 1.960. This means that

service quality has a significant effect on satisfaction

or indicates that the second hypothesis is accepted.

Service Quality has a positive influence on

Satisfaction, namely: Tokopedia in the face of

increasingly tight online business competition at this

time must be able to provide the best service

compared to its competitors. This includes active

response to customer complaints with call center

being active 24 hours a day, and faster delivery of

goods in order to satisfy customers.

4.7 Hypothesis 3. The Effect of

Perceived Value on Satisfaction

The effect of perceived value (PV) on satisfaction

(S) shows that the t-statistic value of 2.660 is greater

than the t-table which is 1.960. This means that

perceived value has a significant effect on

satisfaction, or indicates that the third hypothesis is

accepted.

Perceived Value has a positive influence on

customer satisfaction, namely: Tokopedia can

provide convenience in terms of payment of product

orders by being able to pay using the COD (cash on

delivery) method. This is done so customers are

satisfied as they can see the goods, check the

suitability of the order, and then pay it in cash or

even credit.

4.8 Hypothesis 4. The Effect of

Satisfaction on Loyalty

The effect of satisfaction (S) on loyalty (L) shows

that the t-statistic value of 5.661 is greater than the t-

table which is 1.960. This means that satisfaction

significantly affects loyalty, or the fourth hypothesis

is accepted.

Satisfaction has a positive influence on customer

loyalty, namely: Increased customer satisfaction has

a higher influence on customer loyalty. Tokopedia

creates loyalty programs for customers by providing

special discounts, free delivery, and special

customer service ratings by tracking how often

customers spend and the amount of money spent in

one month or even a year. These were done so that

customer satisfaction and loyalty increases.

4.9 Hypothesis 5. The Effect of Trust

on Loyalty

Referring to the fifth hypothesis test, the effect of

trust (T) on loyalty (T) shows the t-statistic value of

2,002 greater than the t-table which is 1,960. This

result demonstrates that trust has a significant effect

on loyalty, meaning that the fifth hypothesis is

accepted.

Trust has a positive influence on customer

loyalty, namely: Security in conducting transactions,

such as product photos that are appropriate and

relevant and providing compensation if problems

occur when customers make transactions.

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4.10 Hypothesis 6. The Effect of Service

Quality on Loyalty

The sixth hypothesis test shows that the effect of

service quality (SQ) on loyalty (L) variable in the t-

statistic value of 0.869 is smaller than the t-table

which is 1.960. This means that service quality is not

proven to affect loyalty, or the sixth hypothesis is

rejected.

Service Quality has a non-positive (small) effect

on customer loyalty, namely: This indicates that

service quality or service quality does not have a

significant influence on the level of loyalty of

Tokopedia customers, because it must involve

several parties besides Tokopedia as an ecommerce

service. This includes service quality of sellers

(online stores/ Tokopedia merchants) and service

quality of goods delivery companies. Service quality

must be mediated by customer satisfaction in order

to have a significant effect on loyalty, so for that,

Tokopedia needs to focus as a regulator to ensure

cooperation synergy and service quality standards

from several parties to satisfy both customers (online

stores) and goods/product delivery service

companies.

4.11 Hypothesis 7. The Effect of

Perceived Value on Loyalty

The seventh hypothesis test highlights that the effect

of the perceived value (PV) on the loyalty (L) results

in the t-statistic value of 4.925 greater than the t-

table which is 1.960. This means that perceived

value has a significant effect on loyalty or it also

indicates that the seventh hypothesis is accepted.

Perceived Value has a positive influence on

customer loyalty, namely: a memorable and

enjoyable shopping experience such as easy and fast

in buying a product / service and being able to get

interest-free installments by cooperating with a bank

or other funding institutions. Tokopedia must further

enhance the promotional program by providing

products with the lowest prices but with the best

quality. They should also guarantee that the product

is genuine with an official guarantee.

5 CONCLUSION AND FURTHER

RESEARCH

Trust, Service Quality, and Perceived Value has

proven to be able to provide satisfaction for

customers and have a positive impact on customer

loyalty. Therefore, Tokopedia needs more

innovation and focus on considering customer

loyalty in order to survive among other high quality

and excellent competition of online retail services in

Indonesia.

Other influencing factors can also be examined

in further studies by adding other variables, such as

price, promotion, discount, and switching cost.

Customer relationship marketing can also be

investigated.

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