The determinants of customer loyalty: An analysis of intangible factors in three service industries

Abstract

The purpose of this study is to investigate how customers’ perceptions of service quality, product quality, and price fairness influence their loyalty to a particular service provider. Based on the results of a pilot study, we have elected to study banks, auto repair and maintenance shops, and (gasoline) filling stations, each of which are characterized by differing degrees of intangible service provision. Our results show that customer satisfaction either fully or partially mediates the relationship between consumers’ perceptions and their loyalty. The direct or indirect effects on customer loyalty of the perception of product and service quality, as well as of perceived price fairness, are related to the differing levels of intangible service associated with each of the three different service industries.