The Influence of Merchandise, Location Image, Perceptions of

Atmosphere, and the Loyalty of the Car Showroom Area in Indonesia

Wisnalmawati

and Bagas Eko Prasetyo

Universitas Pembangunan Nasional Veteran Yogyakarta

Faculty of Economics and Business Universitas Gunadarma Jakarta

Keywords: Merchandise, Perceptions of Atmosphere, Location Image and Loyalty

Abstract: The importance of choosing a place to shop for consumers, especially in the purchase of valuable products,

in this case, the purchase of a car. Especially when a purchase decision will appear. The purpose of this study

was to 1. analyze the effect of merchandise directly affecting the loyalty of the Harapan Indah region of

Indonesia. 2. analyze the effect of merchandise on loyalty mediated by perceptions of the atmosphere. 3.

analyze the effect of location images directly influence loyalty. 4. analyze the effect of location imagery on

loyalty mediated by perceptions of the atmosphere. The research respondents were car customers, a total of

100 analytical techniques used were the Structural Equational Model (SEM) with PLS Program. The results

of this study indicate that 1. merchandise does not affect the loyalty of the Harapan Indah area of Indonesia.

2. merchandise affects the loyalty of the area mediated by the perception of the atmosphere 3. the image of

the location does not directly influence the loyalty of the region. 4. The image of the location directly affects

the loyalty of the region mediated by the perception of the atmosphere. The novelty of this research is the

perception of the atmosphere can increase car consumer loyalty. The results of this research contribute to the

development of consumer behavior models. Develop a business strategy of offering cars in studying consumer

behavior.

1 INTRODUCTION

Technological developments shift trade impact

shifting consumer behavior. Consumers can easily

make purchases without spending energy and can

make time-efficient. In the past, car brokers or car

dealers used to sell their car merchandise in

showrooms that were close to shops that sold various

other products, such as clothing, electronics, and

other products. When people want to shop for clothes,

electronics can also look at cars, but consumers rarely

do that. With the times evolving along with changes

in consumer behavior so there is a thought of the

developers of entrepreneurs building shops in a new

area, such as the area of silver craftsmen, batik

artisans, etc. Likewise, for used car entrepreneurs to

develop an area that is used as a selling place for used

cars.

Harapan Indah area is already well-known by

consumers who are in Jakarta and even outside

Jakarta because there is a place for buying and selling

used cars, this area is a very strategic environment

and easy to reach by consumers. In this area, there are

approximately 20 car showrooms. The showroom is

in the form of community shops, with well-designed

shop buildings so that it becomes an attraction for

consumers to visit there. Uniqueness, The location of

this showroom is not in shops that sell a variety of

other products, such as clothing stores, electronics

besides selling car showrooms. Cars sold in the region

consist of various types of brands, namely Honda,

Toyota, Nissan, and other brands. The showroom

sells cars for a variety of years, but more cars have

been sold in the last five years, from 2015 to 2019.

Car prices there follow the generally accepted market

price with good quality.

Based on interviews and initial interviews with

consumers in a showroom in the Harapan Indah area,

it can be identified, that is, consumers come for the

first time to search for information about the car

needed, but there are also transactions that occur right

away, but not all people who do that, sometimes -

sometimes come second third new transaction. Also,

there is a comparison of the price of the car with the

quality of the car with other showrooms. Various

kinds of consumer behavior to buy a car, some

directly transact at the time, some are not. The

description of consumer loyalty in the Harapan Indah

Wisnalmawati, . and Prasetyo, B.

The Inﬂuence of Merchandise, Location Image, Perceptions of Atmosphere, and the Loyalty of the Car Showroom Area in Indonesia.

DOI: 10.5220/0009961902410245

In Proceedings of the International Conference of Business, Economy, Entrepreneurship and Management (ICBEEM 2019), pages 241-245

ISBN: 978-989-758-471-8

241

shops area is based on observations, and it seems that

there are some shops that are crowded by consumers,

some are lonely. Instead, it is interesting to study

scientifically because it looks for the cause.

Phenomena that can be observed by showroom

owners providing good quality car merchandise,

providing small quantities for cars in the last five

years. The phenomena that occur in stores in the area

of Harapan Indah can be categorized into related

concepts, namely merchandise, perception of the

atmosphere, and image of the location of the area. In

connection with the concepts that have been put

forward have been researched by previous

researchers, although some of the research has

examined at motorbike dealers and car and workshop

showrooms. In this case, the researcher wants to do a

re-study as previously done by researchers like

Sharma (2012), proving that perceived quality can

affect loyalty in the American financial services

company. Yee and San (2011) prove that perceived

quality can affect loyalty in Automobile industry

customers in Malaysia. Buil et al. (2013) prove that

perceived quality influences brand loyalty on Adidas

and Nike brand customers (sportswear), Sony, and

Panasonic (electronics); BMW and Volkswagen

(cars).

The objectives of this study are (1) Analyzing the

effect of merchandise directly affecting the loyalty of

the Hope Indonesia region. (2) analyze the effect of

merchandise on the loyalty of the area mediated by

the perception of the atmosphere. (3) analyzing the

influence of the location image directly influences

area loyalty. (4) analyze the effect of location imagery

influencing the loyalty of the area mediated by the

perception of the atmosphere.

2 LITERATURE REVIEW

Customer loyalty is defined as the relationship

between repetitive attitudes (Dölarslan, 2014). Brand

loyalty Long-term commitment that is held firm to

consistently repurchase or re-synchronize a

product/service from the same brand. Car attributes,

high quality, attractive cars, and designed by

choosing safer cars, I will buy a durable car. Car

queue imagery (Narteh, Odoom, Braimah, & Buame,

2012). The image can be like a brand name; the

country of origin is an impression (Dongdae Lee,

1999). Brand loyalty as a whole attitude towards

brand loyalty (Chernatony, 2013). Loyalty to buy

back a product (Sharma, 2012). Merchandise is

concerned with product quality, product choices in

stores in the region, types of products offered.

Hawkins (1998). Imagery related to travel to the

location, the right store hours, the uniqueness of the

place. In general, the perception of an atmosphere of

harmony, comfort, joy, towards a brand, (Kotler &

Keller, 2012); (Olson, 2010).

Figure 1: Conceptual Framework

H1: There is a direct influence of merchandise on

the loyalty of the Hope Indonesia region.

H2: There is an effect of merchandise on the area's

loyalty in mediation by the perception of the

atmosphere.

H3: There is an influence of location image

directly influencing the area loyalty.

H4: There is an influence of location image on the

loyalty of the region mediated by the perception of

the atmosphere.

3 RESEARCH METHODS

The unit of analysis for this research is shops in the

Harapan Indah Region in Indonesia. The population

of all customers who make purchases in the area's

stores. The number of respondents is 100 car

customers in Indonesia. Hypothesis testing is done by

the model of Structural Equation Modeling with PLS

(Partial Least Square) to test the effect of variables.

Table 1. Operational Definition

VariableVariable Indicator / item

Factor

Merchandise

image

Source:

Assael (2006), Zee

et all (2007),

Minjung Park et all

(2009, Amit et al.

(2010)

1. Quality of care

products,

2. Options

products in shops

in the area,

3.car type

0.628

0.709

0.864

image location

Engel (1996);

Hawkins et al.

(1998

1. Journey to the

current location

2. the right store

hours

3. uniqueness point

showroom

0.896

0.901

0.817

ICBEEM 2019 - International Conference on Business, Economy, Entrepreneurship and Management

242

Perception of

Atmosphere

Engel (1996);

Hawkins et al.

(1998

1. Harmony,

2. Comfort,

3. Joy,

0.906

0.846

0.866

Loyalty

Anne-Sophie

Binninger (2006,

Trang TM Nguyen

et al. (2006).

1. Repeated

behavior in

stores in the area

2. Positive mouth-

to-mouth

communication

about shops

3. Commitment to

stores

0,859

0,936

0,887

In table 2, all variable indicators show the value

of the loading factor overcome 0.6 so that it can be

said all indicators are declared valid.

Table 2. Reliability test results

No Variable Alpha

Cronbach

Description

1 Merchandise

image

0.766 Reliable

2 Location

image

0.825 Reliable

3 Perceived

atmosphere

0.899 Reliable

4 Loyalty 0.915 Reliable

The processed data shows that the Cronbach alpha

value has a value above 0, 7, so that all variables are

declared reliable.

4 RESULTS

Processed data results that show the influence

between variables can be seen in figures 2 and 3.

Figure 2. Path analysis results

Figure 3. Path analysis

Results Viewing the results of data processing

shows that two pathways are not significant. This

means that merchandise on loyalty does not directly

influence, so does the perception of the atmosphere

does not affect customer loyalty. These results are

shown in Table 3

Table 3. Table results

Variables

Influence

Coefficients

Line

Significance

Level

X1- Y 0.255 0.060

X1-Z 0,383 0,017

X2-Y 0,253 0.076

X2-Z 0.381 0.015

Z-Y 0.348 0.002

4.1 Hypothesis Testing

Hypothesis testing first; There is the influence of

merchandise directly affect the loyalty of the Indah

Indonesia hope area. Hypothesis Testing First; Based

on Figure 4.1 shows merchandise has no direct effect

on the loyalty of the Indah Indonesia hope area, the

path coefficient = 0.255 (P-value = 0.060.

Merchandise does not significantly influence loyalty

(H1 not proven). In other words, merchandise is

related to the quality of care products, product choices

in stores in the region, the type of car has no effect on

repetitive behavior in the store, positive mouth-to-

mouth communication about stores, commitment to

stores in the Harapan Indah region. This study does

not support the theory and previous research, namely

Assael (2006); Assael (2006), Zee et all (2007),

Minjung Park et all (2009, Amit et al. (2010),

Florence Kremer (2012).

Testing of the second hypothesis: merchandise

directly affects the loyalty of the region mediated by

the perception of the atmosphere. Determine the

perception of the atmosphere as mediating or cannot

be considered the path of each variable, in this case,

the influence of the merch Andise does not have a

direct significant effect, automatic perception of

atmosphere in this research model is mediation so that

perception of atmosphere is an important variable that

The Inﬂuence of Merchandise, Location Image, Perceptions of Atmosphere, and the Loyalty of the Car Showroom Area in Indonesia

243

needs to be created in this region. The perception of

the atmosphere must be created to create customer

loyalty. The perception of the atmosphere is related to

harmony, comfort, the excitement of car buyers in the

Harapan Indah region.

Third hypothesis testing; There is the influence of

the location of the image that does not directly affect

the loyalty of the Indah Indonesia hope area. Third

hypothesis testing; Based on Figure 4.1, the location

image has no direct effect on the loyalty of the Indah

Indonesia hope area; the path coefficient = 0.253 (P-

value = 0.076. Location image does not significantly

influence loyalty (H1 not proven).

Testing the fourth hypothesis; location image has

no effect on the loyalty of the area mediated by the

perception of the atmosphere Hypothesis testing: To

determine the perception of the atmosphere as

mediating or not being able to pay attention to the

path of each variable, In this case, the influence of the

location image does not significantly directly

influence, automatically the perception of the

atmosphere in the model is mediated so that the

perception atmosphere is an important variable that

needs to be created in this region Proven perception

of atmosphere must be created so as to create

customer loyalty Ambience perception is related to

harmony, comfort, joy. The rest of 19.85% is

influenced by other variables that cannot be detected

by the PLS model.

Determination Coefficient (R square)

Perception of atmosphere (R21) = 0.517

Loyalty (R22) = 0.589

predictive relevance

Q2 = 1- (1-R21) (1-R22)

= 1- (1- 0.517) (1- 0.589)

= 1- (0.483) (0.411)

= 1- 0.1985

Q2 = 0.8015

5 CONCLUSIONS AND

SUGGESTIONS

(1). Merchandise's image does not have a direct effect

on the loyalty of the Hope Indonesia region. (2). The

merchandise image of the area's loyalty is mediated

by the location's image. (3). The perception of the

atmosphere has a direct effect on regional loyalty. (4).

The perception of the atmosphere influences the

loyalty of the area mediated by the image of the

location.

This research shows that merchandise image has

no direct effect on regional loyalty, but merchandise

image has an effect on customer loyalty mediated by

the perception of the atmosphere. In addition, this

study shows that the location image has no direct

effect on regional loyalty, but location image has an

effect on customer loyalty mediated by perceptions of

the atmosphere. Dalah, this perception of the

atmosphere needs to be created so that customers can

be loyal to the Harapan Indah area. It is expected that

customer purchases at shops in the region become his

choice in buying a car.

The contribution of the theory is to develop

theories of consumer behavior, especially

merchandise images, location images, perceptions of

atmosphere, and customer loyalty in showrooms in

the Harapan Indah region. Practical contributions for

the owner to develop strategies in building the

atmosphere of the region to increase customer

loyalty.

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