Social Media Marketing’s Influence on Customer Loyalty:

A Case Study of Siloam Hospital

Radityo Kusumo Santoso

, Nur Fadillah Dewi

Office Administration and Secretary Department, Vocational Education Program, Universitas Indonesia

Hospital Administration Department, Vocational Education Program, Universitas Indonesia

Keywords: Social media, customer loyalty, customer, marketing, hospital

Abstract: Rapid technological developments are affecting the intersection of life and the nation’s economy, disrupting

the way humans interact and communicate. This change affects how economic activities are conducted

place, especially in marketing, where customer retention is the most crucial objective. This study thereby

determines whether social media influences consumer loyalty by employing a quantitative approach with

multiple regression. Data were collected by distributing questionnaires to 32 respondents who were

inpatients at Siloam Hospital.

1 INTRODUCTION

The rapid development of technology has affected

the intersection of life and national economy; it has

also disrupted the way people communicate. The

disruption of the way consumer information is

distributed comes from the transition from print

media to digital media. This transition has further

modified the communication modes employed while

socializing in the community. The Indonesian

Association of Internet Service Providers reports

that in 2017 the number of Internet users in

Indonesia stood at 143.26 million users—an increase

of 10 million users over 2016 (132.7 million users).

It also indicated that the majority of Internet users

have 72.41% more access to people in urban areas.

According to We Are Social, which produces

reports on social media, there are now 130 million

active social media users on various social media

platforms in Indonesia.

This change in how people consume new

information affects how economic activities are

performed, especially in the field of marketing,

where creating customer loyalty to a brand is of

primary importance. According to Park and Seo

(2018), social media is defined as an online

application program, platform, or media that ease

interactions, joint work, or content sharing.

Social media has mostly been recognized as an

effective mechanism, contributing to a company’s

marketing goals and strategy, especially in customer

engagement, customer relationship management,

and communication (Filo, Lock, and Karg, 2015).

Alongside the generalization of social media in the

society, researchers have studied the use of social

media in society by asking users why they use social

media, how much time they spend using it, and how

much social media do they use over a given period

(Bolton et al., 2013). According to the 90-9-1 rule

for the use of social media, 90% of social media

users only display content, 9% use social media to

add comments, and only 1% add new content.

Further, social media users can be entered as active

users.

Social media plays a vital role in a company’s

marketing activities in terms of developing

individual customer relationships, and it offers

opportunities to reach customers (Kelly, Kerr, and

Drennan, 2010). In the business environment,

companies are expected to use social media in

several aspects, particularly in interacting with

customers, by facilitating information retrieval,

interactivity, promotion, and manipulating

customer’s purchasing behaviours (Zeng and

Gerritsen, 2014).

Bennet S. reported that approximately 93% of

companies had used innovative platforms and tools

in their efforts to communicate with and serve their

customers worldwide

(http://www.adweek.com/digital/45-social-media-

stats). With the increase of marketing with social

258

Kusumo Santoso, R. and Fadillah Dewi, N.

Social Media Marketing’s Inﬂuence on Customer Loyalty: A Case Study of Siloam Hospital.

DOI: 10.5220/0010673500002967

In Proceedings of the 4th International Conference of Vocational Higher Education (ICVHE 2019) - Empowering Human Capital Towards Sustainable 4.0 Industry, pages 258-265

ISBN: 978-989-758-530-2; ISSN: 2184-9870

media in various sectors, a large amount of research

has been conducted related to the activities of social

media marketing (SMM); most of the research

focuses exclusively on the effects of SMM on

customer satisfaction or behavioural intent (Sano,

2015). Several studies have suggested that the

degree of customer loyalty is often higher if they

favoured the company image and reputation

(Nguyen and Leblanc, 2001). Social media has

attracted the attention of practitioners or researchers

to have a better understanding regarding how such

applications can be successfully implemented to

improve both image and reputation (Billings, 2014;

Hardin, 2014; Hutchins, 2014).

A need to learn more about the key requirements

arises for a successful implementation of such

technology. Further, the required amount of

investment in such applications requires to be

determined (Hutchins, 2014). In this respect,

Hutchins has staunchly emphasized the importance

of researching the role of social media in different

contexts to expand existing knowledge of issues

important in social media’s context (Hutchins,

2014).

Furthermore, the role of Facebook in improving

customer loyalty was proven by Gamboa and

Gonçalves (2014). According to this research,

Facebook fans of the Zara brand had a higher

confidence level, were more satisfied, experienced a

higher value, and accordingly expressed more

loyalty to Zara than those who did not follow the

brand on Facebook. In general, customer satisfaction

is often defined and measured to reflect specific

settings and levels determined by every aspect of the

purchasing process (Czepiel and Rosenberg, 1977).

Customer satisfaction was considered an essential

element for achieving customer loyalty (Oliver,

1999; Zeithaml, Berry, and Parasuraman, 1996a).

The research mentioned above background has led

to this study, which researches the influence of

SMM activities on customer loyalty.

2 LITERATURE REVIEW

2.1 SMM

According to Neti’s (2011) study, SMM consists of

attempts to use social media to persuade consumers

of a company to purchase its products or services.

SMM is a type of marketing that uses online

communities, social networking, and marketing

blogs. Moreover, there are three advantages to

SMM. First, SMM provides marketers with the

ability to not only promote current products or

services but also to address consumer complaints

and suggestions. Second, SMM makes it easy for

marketers to identify various peer groups or

influencers among different groups. Third, the use of

SMM can be said to have zero cost because most

social networking sites are not paid. For these

reasons, SMM can be used to improvise customer

loyalty (Neti, 2011).

The elements of social media are also discussed

in several studies. Kim and Ko (2012) classify SMM

features as entertainment, interaction, trend,

personalization, and word-of-mouth advertising and

apply these features to luxury brands. Sano (2014)

employed research on applied interaction,

trendiness, customization, and perceived risk as to

the four SMM components while researching on the

tourism industry. Chang’s (2012) comparative study

of the performance characteristics of each medium

(e.g., portals, blogs, and SNS) lists customer

participation, representation of information, unique

differentiation, content compliance, use of

information, and customer feedback as the

characteristics of social media. Based on the

previous studies, the SMM components are defined

as entertainment, interaction, trends, personalization,

and perceived risk for this study.

Entertainment can be defined as fun and play

through social media (Agichtein, Donato Castillo,

and Gionis, 2008). Some people use social media as

their entertainment. Virtual communities exist to

further this interest (Bagozzi and Dholakia, 2002;

Manthiou, Chiang, and Liang (Rebecca) Tang,

2013). Virtual communities also include space for

consumers to discuss and exchange ideas, and

interactions through social media provide insight

regarding the users who contribute to these

platforms, which are usually associated with specific

brands. These users meet in cyberspace and discuss

specific products and/or brands (Muntinga,

Moorman, and Smit, 2011).

Moreover, virtual communities offer the latest

news and information, making it a tool for users to

search for the most practical products (Naaman,

Becker, and Gravano, 2011). Consumers tend to

trust information obtained through social media

rather than through advertising involved in

marketing or promotional activities. Therefore, there

is confidence in the different types of social media

that offer the latest product information (Mangold

and Faulds, 2009). The trend is, therefore defined as

providing the latest information about products or

services (Godey et al., 2016).

Social Media Marketing’s Inﬂuence on Customer Loyalty: A Case Study of Siloam Hospital

259

The level of adaptation indicates what new

changes satisfy customer’s needs (Schmenner,

1986). Customization in social media is derived on

the basis of contact with individual users. This

custom is a vast difference between social media and

conventional advertising. It is possible to provide

customers with individually optimized information

generated by different sources. This practice is used

as a strategy to reinforce customer satisfaction (Ding

and Keh, 2016). Marketing through social media is

also a tool for companies to communicate the

uniqueness of their brands and for consumers to

indicate their preferences and loyalty to specific

brands (Martin and Todorov, 2010).

Previous research has identified the uncertainty

associated with consumer behaviour as a perceived

risk (Bauer, 1960). However, social media reduces

the uncertainty of this perceived risk because it

allows consumers to connect with companies and

check for new information (Sano, 2014). The

perceived risk is selected as an SMM component

mainly due to social media’s ability to reduce

anxiety or concerns felt by consumers.

2.2 Customer Satisfaction

Generally, customer satisfaction is often defined and

measured by using specific settings, and the level of

satisfaction is determined by examining every aspect

of purchasing and consumption process (Czepiel and

Rosenberg, 1977). In the context of intercity bus

services, purchase decision and service provision are

the two customer satisfaction elements that can be

used to measure the extent to which passenger

expectations have been met. Purchasing decision

satisfaction refers to the evaluation of how well

passengers are satisfied with their decision to choose

a particular company. In contrast, customer

satisfaction with the service is related to the

evaluation of how well passengers are satisfied with

the services provided by the company. Customer

satisfaction is thereby considered as an essential

element for maintaining customer loyalty (Oliver,

1999; Zeithaml, Berry, and Parasuraman, 1996a).

2.3 Customer Loyalty

Customer loyalty includes their buyback intentions

(behavioural loyalty) and their positive experiences

and willingness to retain old customers and attract

new customers in the services sector. They can

recommend a particular company’s services and

products to others (attitudinal loyalty) (Zeithaml,

Berry, and Parasuraman, 1996b). These desirable

behaviours and attitudes represent two essential

aspects of customer loyalty (Mandhachitara and

Poolthong, 2011; Martínez and Rodríguez del

Bosque, 2013). The research model is explained in

the figure below (Fig.1):

Figure 1: Research Model.

3 METHOD

The statistical package SPSS 19 was employed to

test and analyze the hypothesized relationships of

the research model. A questionnaire survey with a

total of 22 items was employed to collect data from

customers of Siloam Hospital.

3.1 Sample Design

The questionnaire used in this study was developed

based on a literature review; it examined the SMM

of Premier Hospital concerning five marketing

activities, namely, entertainment, interaction,

trendiness, customization, and perceived risk. The

survey also rated customer satisfaction for decision

satisfaction and service satisfaction. Customer

loyalty was rated for behavioral loyalty and

attitudinal loyalty.

ICVHE 2019 - The International Conference of Vocational Higher Education (ICVHE) “Empowering Human Capital Towards Sustainable

4.0 Industry”

260

Table 1: Sample Design Table.

Concep

Variable Item

SMM

Activity

Entertainment

1. This hospital’s social

media platforms are fun.

2. The content shared by the

social media platforms of

this hospital is enjoyable.

Interaction

1. It is possible to share

information on the social

media platforms of this

hospital.

2. Discussion and exchange

of opinions are possible on

the social media platforms of

this hospital.

3. Expressing opinions is

accessible on the social

media of this hospital.

Trendiness

1. The information that is

shared on this hospital’s

social media is current.

2. The use of social media by

this hospital is in fashion.

Customization

1. I can find the information

that I need on this hospital’s

social media platforms.

2. This hospital’s social

media platforms provided the

information I needed.

Perceived

Risk

1. This hospital’s social

media has taken away my

concern(s) about the

hospital’s service.

2. This hospital’s social

media has alleviated my

concern(s) about the use of

the hospital

Customer

Satisfaction

Decision

Satisfaction

1. I have always had a

satisfactory experience with

this company.

2. I think choosing this

company is the right

decision.

Service

Satisfaction

1. The services of this

company always meet my

needs.

2. I love the services of this

company.

3. In general, I am satisfied

with the services of this

company.

Customer

Loyalty

Behavioural

Loyalty

(Customer

Repurchase

Intention)

1. I am a loyal customer of

this company.

2. I intend to remain a

customer of this company

3. This company was my

first choice when I needed

hospitalization.

Attitudinal

Loyalty

(Positive

Tendency

And

Willingness

Recommend

Companies )

1. I will probably say

positive things about this

hospital.

2. I will recommend this

hospital to my relatives and

friends.

3. I will recommend this

hospital if asked by others.

4 RESULTS AND DISCUSSION

4.1 Respondent Characteristics

4.1.1 Gender

Figure 2: Respondent Characteristics based on gender.

This study consisted of 32 respondents (18 women

and 14 men).

4.1.2 Age

Figure 3: Respondent Characteristics based on age.

Of all, 12 respondents of the research were

between 20 and 25 years old. Ten respondents were

<20 years old; 7 respondents were 26–30 years old,

two respondents were 31–35 years and one

respondent was >35 years old. This research notably

consisted of young respondents of this hospital.

4.1.3 Education

Based on the information provided by the

respondents concerning their formal education, the

majority of the respondents had a high school

education; and the remainder of the respondents had

advanced degrees. With seven respondents had

completed their degree courses, five respondents had

completed their diploma courses, and at least four

respondents had completed their masters.

<20

years;10

20‐25

Years;12

26‐30

Years;7

31‐35

Years;2

>35

Years;1

Age

<20years

20‐25Years

26‐30Years

31‐35Years

>35Years

Gender

Male

Female

Social Media Marketing’s Inﬂuence on Customer Loyalty: A Case Study of Siloam Hospital

261

Figure 4: Respondent Characteristics based on education.

4.2 Social Media Components

4.2.1 Entertainment Dimension

The table exhibits that the average ratings the

respondents gave to the entertainment component

ranged from 4.25 to 4.28. Based on these ratings, the

mean value was considered to be high; this displays

that the respondents did not experience lack of

entertainment while communicating with hospital

social media platforms.

Table 2: The average ratings to entertainment dimension.

No. Indicato

Mean Rating

I am delighted when

interacting with the

hospital’s social media

platforms. 4.25 High

I enjoy all the content

shared on this

hospital’s social media

platforms. 4.28 High

4.2.2 Interaction Dimension

In the table, all the indicators have high ratings, with

response No. 1 receiving the highest rating. With a

mean value of 4.66, the respondents agreed that

“This hospital’s social media platforms allow me to

share information.” Because mean on this question

is higher than on other indicators, this indicates that

social media is the medium of communication that

can increase information sharing among consumers.

Table 3: The average ratings to social media platforms.

No. Indicato

Mean Rating

This hospital’s social

media platforms allow me

to share information. 4.66 High

Access to this hospital’s

social media platforms

allows me to discuss and

share information related

to health. 4.41 High

This hospital’s social

media platforms allow me

to express my opinion. 4.34 High

4.2.3 Trendiness Dimension

The abovementioned table represents that the mean

of all indicators is high in this category. The highest

value is obtained for No. 1; with its mean value 4.66,

the respondents said: “In my opinion, the

information shared through this hospital’s social

media is up to date.” Because the mean value of No.

1 is higher than other indicators, it suggests that the

interaction in the high social media is the medium of

communication that can increase sharing

information to each other.

Table 4: The average ratings to trendiness dimension.

No. Indicato

Mean Rating

In my opinion, the information

shared through this hospital’s

social media is up to date. 4.66 High

Access to the hospital’s social

media is part of my lifestyle. 3.75 High

4.2.4 Customization Dimension

The abovementioned table’s indicator means are

ranked high, with No. 1’s rating being the highest.

The respondents gave “I can find the information I

need on this hospital’s social media.” mean value of

4.53. Because the mean value of this question is

higher than other indicators, it suggests that

customization of the hospital’s social media

platforms, as the medium of communication, enables

sharing of any health-related information.

Table 5: The average ratings to the customization

dimension.

No. Indicato

Mean Rating

I can find the information I

need on this hospital’s social

media. 4.53 High

Social media platforms of this

hospital provide information

tha

I need. 4.44 High

High

School

;16

D3;5

S1;7

S2;4

EducationalBackground

High

Scho

ICVHE 2019 - The International Conference of Vocational Higher Education (ICVHE) “Empowering Human Capital Towards Sustainable

4.0 Industry”

262

4.2.5 Perceived Risk Dimension

Table 6: The average ratings to perceived risk dimension.

No. Indicato

Mean Rating

The information

I need, I can find

on social media

this hospital

4.09 Tallish

Social media this

hospital provides

information I

need

4.22 Tallish

The table above shows that the average level of

the respondents. The results indicated that the

dimensions of entertainment ranged from 4.09 until

4.22. Based on the categories, its mean value shows

are in the category, somewhat high this shows that

the respondents did not reflect fell low-risk

perception on while communicating with hospital

social media.

4.2.6 Decision Satisfaction Dimension

Table 7: The average ratings to satisfaction dimension.

No. Indicato

Mean Rating

I always have a

satisfying

experience at this

hospital.

4.41

High

I chose this

hospital because I

think this is the

right choice.

4.44

High

This table displays that the mean values of all

indicators are rated high, with indicator No. 2 having

the highest mean. The respondents said, “I chose this

hospital because I think this is a good choice.” They

gave it a mean value of 4.44. The mean value of this

question is higher than on other indicators. It can be

concluded that respondents were satisfied with their

decision of choosing this hospital.

4.2.7 Service Satisfaction Dimension

Table 8: The average ratings to service satisfaction

dimension.

No. Indicato

Mean Rating

Services at this

hospital always meet

my needs. 4.31 Tallish

I love the services

provided in this

hospital. 4.34 High

On the whole, I am

satisfied with the

services provided by

this hospital. 4.44 High

This table suggests that the mean values of two

indicators within the table are rated high, and one

indicator is tallish. No. 3 has the highest mean value,

4.44. The respondents said, “On the whole, I am

satisfied with the services provided by this hospital.”

Because the mean value for this question is higher

than the other indicators, it suggests that the

respondents’ are satisfied with the service of the

hospital.

4.2.8 Behavioral Loyalty Dimension

Table 9: The average ratings to behavioral loyalty.

No. Indicato

Mean Ratin

I was a loyal

customer to

this hos

ital. 4.09 Tallish

I will always be

a customer of

this hos

ital. 3.88 Tallish

This hospital is

my first choice

when I need a

hos

ital. 4.03 Tallish

This table shows that the average mean values

of the indicators ranged from 3.88 to 4.09. These

mean values are somewhat high; this shows that the

respondents did not choose the hospital as their first

choice just because of the hospital’s social media

platforms.

Social Media Marketing’s Inﬂuence on Customer Loyalty: A Case Study of Siloam Hospital

263

4.2.9 Attitudinal Loyalty Dimension

Table 10: The average ratings to attitudinal loyalty.

No. Indicato

Mean Ratin

I will make positive

comments about this

hospital. 4.66 High

I would recommend

this hospital to my

family members and

relatives. 4.59 High

I would recommend

the hospital to others. 4.66 High

This table suggests the mean values of all

indicators of willingness to recommend the hospital

are high while No. 1 and No. 3 share the highest

value (4.66). No. 1 indicates that the respondents

were willing to make positive comments about the

hospital, and No. 3 indicates that they will

recommend it to others. Because the mean value of

this question is higher than on other indicators, it

indicates that the respondents will provide positive

feedback for the hospital’s social media platforms.

The table mentioned below tests the hypothesis of

the influence of social media on customer loyalty.

Table 11: The test of hypothesis.

Significance score at 0.000 below 0.05 and score

of t calculation > t table, 5.561 > 1.659. The study

thereby concludes that SMM influences customer

loyalty. R

score exhibits that SMM influences

customer loyalty (50.8%); however, customer

loyalty is also affected by the other’s factor such as a

discount, reward, consumer behaviour, and product

price (49.2%).

5 CONCLUSION

This study understands the influence of SMM on

customer loyalty. On the basis of the analysis of this

study, we can conclude the following social media

does influence customer loyalty; this exhibits that

the use of social media has aided in maintaining

consumer. Further, R

score reveals that SMM

influenced customer loyalty (50.8%), and other

factors such as discount, reward, consumer behavior,

and product price also influenced customer loyalty

(49.2%).

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