Keyword

Asian aviation; FSC; National carrier; Structural Equation Model (SEM); Thai Airways; Thailand

Abstract

In 2017, global international tourist arrivals set a new record of 1.32 billion individuals. From this, Thailand moved into the 10th spot with 35.4 million visitors, and US$57.5 billion in tourism earnings, which represented 12% of Thailand’s GDP. Therefore, given the critical nature of tourism to Thailand’s economy and the national carrier’s role, the authors sought to investigate how customer relationship management (CRM), perceived risk (PR), perceived service quality, and passenger trust (PT) affected Thai Airways’ passenger satisfaction (PS).  The research tool developed for the survey consisted of a questionnaire which used a seven-level, Likert type agreement scale for 34 items in Part 2. The study also conducted both a confirmatory factor analysis (CFA) and a structural equation model (SEM) to analyze the sample of 565 Thai Airways’ passengers. A latent variable path analysis was performed using LISREL 9.1 software, with the models found to be consistent with empirical data. The causal factors in the model had both a positive and negative influence on Thai Airways passenger satisfaction (PS), which can be explained by 14% of the variance (R2). The four variables ranked in importance included customer relationship management (CRM), perceived risk (PR), passenger trust (PT), and perceived service quality (PSQ), which had a total value of 1.00, -0.35, 0.20 and 0.11, respectively.


Full Text : PDF

References
  1. Agrawal, M. (2013). The ultimate guide to airline customer relationship management and loyalty. 
  2. Available at: https://tinyurl.com/yarn699n [Accessed 1 Oct. 2018].
  3. Ahrens, J., Coyle, J. R. and Strahilevitz, M. A. (2013). Electronic word of mouth: The effects of incentives on e-referrals by senders and receivers. European Journal of     Marketing, 47(7), pp. 1034 – 1051. Available at: doi: 10.1108/03090561311324192
  4. Ali, Q. (2018). Service quality from customer perception: Comparative analysis between Islamic and conventional bank. Journal of Marketing and Consumer Research, 43, pp. 70 – 82. Available at:  https://tinyurl.com/ybvutn5a [Accessed 1 Oct. 2018].
  5. Amiruddin, N. H. (2013). Price, service quality and customer loyalty: A case study of AirAsia. South East Asia Journal of Contemporary Business, Economics and Law, 2(1). Available at: http://tinyurl.com/lhohoae [Accessed 1 Oct. 2018].
  6. Angelova, B. and Zekiri, J. (2011). Measuring customer satisfaction with service quality     using American Customer Satisfaction Model (ACSI Model). International Journal of Academic Research in Business and Social Sciences, 1(3), pp. 232 – 258. Available at: doi: 10.6007/ijarbss. v1i2.35 
  7. ASEAN Today. (2018). A potential remedy for Thailand’s tourism woes. Available at:     https://tinyurl.com/yccxgyfj [Accessed 1 Oct. 2018].
  8. Baker, D. A. (2013). Service quality and customer satisfaction in the airline industry: A comparison between legacy     airlines and low-cost airlines. American Journal of Tourism Research, 2(1), pp. 67-77. Available at: doi: 10.11634/216837861302317 
  9. Baker, D. (2014). Low-cost airlines management model and customer satisfaction. International Journal of Economics, Commerce, and Management, 2(9), pp. 1 – 17. Available at: http://tinyurl.com/jxg2ymb [Accessed 1 Oct. 2018].
  10. Baker, D. (2014). Low-cost airlines management model and customer satisfaction. International Journal of     Economics, Commerce, and Management, 2(9), pp. 1 – 17. Available at: http://tinyurl.com/jxg2ymb [Accessed 1 Oct. 2018].
  11. Best, J. W. and Kahn, J. V. (2003). Research in Education. 10th ed., New Jersey: Pearson.  
  12. Blythe, J. (2013). Consumer behavior. Thousand Oaks, CA: Sage Publications.
  13. Boeing upgrades aircraft forecast. (2018). TR Weekly. Available at:     https://tinyurl.com/y9fonf8d [Accessed 1 Oct. 2018].
  14. Byrne, B. M., Shavelson, R. J. and Muthén, B. (1989). Testing for the equivalence of factor     covariance and mean     structures: The issue of partial measurement invariance. 
  15. Psychological Bulletin, 105(3), pp. 456–466. Available at: doi: 10.1037//0033-2909.105.3.456 
  16. Byun, H., Lee, B. and Rye, J. (2014). A comparative study on evaluating the service quality attributes based on Kano Model: A case of low-cost carrier and full-service carrier. SHS Web of Conferences, 12. Available at: doi: 0.1051/shsconf/20141201017 
  17. Centre for Aviation. (2018). Thailand low-cost airlines: Rapid growth as fleet triples in 5 years. Available at: https://tinyurl.com/y7b76dda [Accessed 1 Oct. 2018].
  18. Chang, H. H., and Chen, W. W. (2008). The impact of online store environment cues on     purchase intention, trust, and perceived risk as a mediator. Online Information Review, 32(6), pp. 818-841. Available at: doi: 10.1108/14684520810923953
  19. Chau, P. Y. K. (1997). Reexamining a model for evaluating information center success using a structural equation modeling approach. Decision Sciences, 28(2), pp.  309 – 334. Available at: doi: 10.1111/j.1540-5915. 1997.tb01313.x
  20. Charoensuthipan, P. (2018, August 27). Korea visa-free arrivals still in effect. Bangkok Post. Available at: https://tinyurl.com/ycng7zo7 [Accessed 1 Oct. 2018].
  21. Chaudury, A. and Holbrook, M. B. (2001). The chain of effects from brand trust and brand affect to brand performance: The role of brand loyalty. Journal of Marketing, 65(2), pp. 81–93. Available at: doi: 10.1509/jmkg.65.2.81.18255 
  22. Chen, Y-S. and Chang, C-H. (2013). Towards green trust: The influences of green     perceived quality, green perceived risk, and green satisfaction. Management Decision, 51(1), pp. 63-82. Available at: doi: 10.1108/00251741311291319 
  23. Cho, M., Bonn, M. A. and Kang, S. (2014). Wine attributes, perceived risk and online wine repurchase intention: The cross-level interaction effects of website quality. International Journal of Hospitality Management, 43(0), pp. 108-120. Available at: doi: 10.1016/j.ijhm.2014.09.002 
  24. Chou, C-C., Liu, L-J., Huang, S-F., Yih, J-M. and Han, T-C. (2011). An evaluation of airline service quality using the fuzzy weighted SERVQUAL method. Applied Soft Computing, 11(2), pp. 2117 – 2128.  Available at: doi: 10.1016/j.asoc.2010.07.010 
  25. Cox, D. F. (1967). Introduction. In: D.F. Cox, ed., Risk taking and information handling in consumer behaviour (p.15). Boston, MA: Harvard University Press. 
  26. Curry, N. and Gao, Y. (2012). Low-cost airlines—A new customer relationship? An analysis of service quality, service satisfaction, and customer loyalty in a low-cost setting. Services Marketing Quarterly, 33(2), pp. 104 – 118. Available at: doi: 10.1080/15332969.2012.662457 
  27. de Villiers, R. (2015). Customer brand enmeshment: Typography and complexity     modeling of customer brand engagement and brand loyalty enactments. Journal of Business Research, 68(9), pp. 1953 – 1963. Available at: doi: 10.1016/j.jbusres.2015.01.005
  28. DuPont, G. (2015). Southeast Asia aviation: What you need to know. New Airport Insider.  Available at: https://tinyurl.com/l9dw6vf [Accessed 1 Oct. 2018].
  29. DuPont, G. (2017). Thailand Aviation: What Happened to It? New Airport Insider. Available at: https://tinyurl.com/y8pa8d65 [Accessed 1 Oct. 2018].
  30. Ehbara, R. A. and Shukor, S. A. (2016). Impact of service quality factors on customer trust in Libyan airline industry. International Journal of Academic Research in Business and Social Sciences, 6(5), pp. 350-363. Available at: doi: 10.6007/ijarbss/v6-i5/2153 
  31. Fornell, C. and Larcker, D. F. (1981). Evaluating structural equation models with     unobservable variables and
  32.  measurement error. Journal of Marketing Research, 18(1), pp. 39-50. Available at: doi: https://doi.org/10.2307/3151312
  33. Frost, J. (2017). How to interpret R-squared in regression analysis. Available at: https://tinyurl.com/ydygpckw
  34. Gefen, D. (2002). Customer Loyalty in E-Commerce. Journal of the Association for Information Systems, 3(1), pp. 27 – 51. Available at: https://tinyurl.com/y7rbjvcx [Accessed 1 Oct. 2018].
  35. Ghotbabadi, A. R., Feiz, S. and Baharun, R. (2016). The relationship of customer perceived risk and customer satisfaction. Mediterranean Journal of Social Sciences, 7(1), pp. 161- 173. Available at: doi: 10.5901/mjss. 2016.v7n1s1p161 
  36. Gilbert, D. and Wong, R. K. C. (2003). Passenger expectations and airline services: A Hong Kong-based study. Tourism Management, 24(5), pp. 519-532. Available at:
  37. doi: 10.1016/s0261-5177(03)00002-5 
  38. Goldenberg, B. J. (2015). The definitive guide to social CRM: Maximizing customer     relationships with social media to gain market insights, customers, and profits. Upper Saddle River, New Jersey: Paul Boger. 
  39. Grant, L. (2017). Qantas 2017 investor day. Available at: https://tinyurl.com/yd39xbym [Accessed 3 Oct. 2018].
  40. Gregg, D. G. and Walczak, S. (2010). The relationship between website quality, trust and price premiums at online auctions. Electronic Commerce Research, 10(1), pp. 1–25.Available at: doi: 10.1007/s10660-010-9044-2 
  41. Hair, J. F., Hult, G. T. M., Ringle, C. and Sarstedt, M. (2016). A primer on partial least squares structural equation modelling (PLS-SEM). Thousand Oaks, CA: Sage.
  42. Haryono, S., Suharyono, Fauzi, A. D. H. and Suyadi, I. (2015). The effects of service quality on customer satisfaction, customer delight, trust, repurchase intention, and word of mouth. European Journal of Business and Management, 7(12), pp. 36 – 48. Available at: http://tinyurl.com/hgpqhw2 [Accessed 1 Oct. 2018].
  43. Heracleous, L. and Wirtz, J. (2010). The Globe: Singapore Airlines’ balancing act. Harvard Business Review, July–August. Available at: http://tinyurl.com/zd9esrq [Accessed 1 Oct. 2018].
  44. Hogan, J. (2017). Tough times set to continue in aviation industry. Arabian Business Info. Available at: https://tinyurl.com/ycmghwqe [Accessed 1 Oct. 2018].
  45. Hooper, D., Coughlan, J. and Mullen, M. (2008). Structural equation modelling: Guidelines for determining model fit. Electronic Journal of Business Research Methods, 6(1), pp. 53-60. Available at: http://tinyurl.com/zyd6od2 [Accessed 1 Oct. 2018].    
  46. Hu, L. T. and Bentler, P. M. (1999). Cutoff criteria for fit indexes in covariance structure analysis: Conventional criteria versus new alternatives. Structural Equation Modeling, 6(1), pp. 1 – 55. Available at: doi: 10.1080/10705519909540118
  47. Hussain, R., Nasser, A. A. and Hussain, Y. K. (2015). Service quality and customer satisfaction of a UAE-based airline: An empirical investigation. Journal of Air Transport Management, 42, pp. 167 – 175.  Available at: doi: 10.1016/j.jairtraman.2014.10.001 
  48. Hutchins, D. (1985). Achieve Total Quality. UK: Fitzwilliam Publishing.
  49. IATA. (2017). 2017 marked by strong passenger demand, record load factor. International Air Transport Association. Available at: https://tinyurl.com/y9kwlhgo [Accessed 1 Oct. 2018].
  50. Jacoby, J. and Kaplan, L. (1972). The components of perceived risk. Advances in Consumer Research, 3, pp. 382–383. Available at: https://tinyurl.com/y9r48lu8 [Accessed 1 Oct. 2018].
  51. Jöreskog, K. G., Olsson, U. H. and Fan, Y. W. (2016). Multivariate analysis with LISREL. Berlin, Germany.  
  52. Järveläinen, J. (2007). Online purchase intentions: An empirical testing of a multiple-    theory model. Journal of Organizational Computing and Electronic Commerce, 17(1), pp. 53 – 74. Available at: http://tinyurl.com/zgdwsaz [Accessed 1 Oct. 2018].
  53. JD Power. (2018). North America airline satisfaction study. Available at: https://tinyurl.com/y8hvax63 [Accessed 1 Oct. 2018].
  54. Johnson, M. S., Sivadas, E. and Garbarino, E. (2008). Customer satisfaction, perceived risk and affective commitment: an investigation of directions of influence. Journal of Services Marketing, 22(5), pp. 353-362. Available at: doi:     10.1108/08876040810889120 
  55. Juran, J. M. and Gryna, F. M. (1998). Juran’s quality control handbook. New York, NY: McGraw Hill.
  56. Kim, Y. K. and Lee, H. R. (2011). Customer satisfaction using low-cost carriers. Tourism Management, 32(2), pp. 235 – 243. Available at: doi: 10.1016/j.tourman.2009.12.008 
  57. Kline, R. B. (2011). Principles and practice of structural equation modeling. 3rd ed. New York, NY: The Guilford Press. 
  58. Kositchotethana, B. (2017). Budget carriers' passenger traffic continues to soar. Bangkok Post. Available at: http://tinyurl.com/len4qpe [Accessed 1 Oct. 2018].
  59. Kotler, P. and Armstrong, G. (2002). Marketing: An introduction. Englewood Cliffs, NJ: Prentice–Hall.
  60. Krämer, A., Tachilzik, T. and Bongaerts, R. (2017). Technology and disruption: How the new customer relationship influence the corporate strategy. In: A. Khare, B. Stewart, and R. Schatz. Eds., Phantom Ex Machina, Springer, pp. 53-70.
  61. Available at: doi: 10.1007/978-3-319-44468-0_4
  62. Krejcie, R. V. and Morgan, D. W. (1970). Determining sample size for research activities.  Educational and Psychological Measurement, 30(3), pp. 607 – 610. Available at: doi: 10.1177/001316447003000308 
  63. Kulpa, J. (2017). Why is customer relationship management so important? Forbes. Available at: 
  64. https://tinyurl.com/y8wyl97t [Accessed 1 Oct. 2018].
  65. Kumudha, A. and Bhunia, A. (2016). Customer relationship management and marketing practices in airlines industry - An empirical study. International Journal of Applied Research, 2(11), pp. 39-43. Available at: https://tinyurl.com/yaly2mtm [Accessed 1 Oct. 2018].
  66. Lau, T-C, Kwek, C-L. and Tan, H-P. (2011). Airline e-ticketing service: How e-service quality and customer satisfaction impacted. International Business Management, 5(4), pp. 200 – 208. Available at: doi: 10.3923/ibm.2011.200.208
  67. Lerrthaitrakul, W. and Panjakajornsak, V. (2014). The airline service quality affecting post purchase behavioral intention: Empirical evidence from the low-cost airline industry. International Journal of Trade, Economics and Finance. 5(2), pp. 155-158. Available at: doi: 10.7763/ijtef. 2014.v5.360 
  68. Levine, D., Berenson, M. and Krehbiel, T. C. (2011). Basic Business Statistics: Concepts and Applications (12th ed.). New Jersey: Prentice Hall. 
  69. Larentis, F., Antonello, C. S. and Slongo, L. A. (2018). Organizational culture and relationship marketing: an interorganizational perspective. Review of Business Management, 20(1), pp. 37 – 56. Available at: doi: 10.7819/rbgn. v20i1.3688 
  70. Malthouse, E. C., Haenlein, M., Skiera, B., Wege, E. and Zhang, M. (2013). Managing customer relationships in the social media era: Introducing the social CRM House. Journal of Interactive Marketing, 27(4), pp. 270 – 280. Available at: doi: 10.1016/j.intmar.2013.09.008 
  71. Marakanon, L. and Panjakajornsak, V. (2017). Perceived quality, perceived risk and customer trust affecting customer loyalty of environmentally friendly electronics products. Kasetsart Journal of Social Sciences, 38(1), pp. 24 – 30. Available at: doi: 10.1016/j.kjss.2016.08.012 
  72. Matell, M. S. and Jacoby, J. (1972). Is there an optimal number of alternatives for Likert-scale items? Effects of testing     time and scale properties. Journal of Applied Psychology, 56(6), pp. 506-509. Available at: doi: 10.1037/h0033601 
  73. Morgan, R. M. and Hunt, S. D. (1994). The commitment-trust theory of relationship marketing. The Journal of Marketing, 58(3), pp. 20-38. Available at: doi: 10.2307/1252308 
  74. Munusamy, J., Chelliah, S. and Pandian, S. (2011). Customer satisfaction delivery in airline industry in Malaysia: A case of low-cost carrier. Australian Journal of Basic and Applied Sciences, 5(11), pp. 718-723.
  75. Nyhan, R. C. and Marlowe, H. A. (1997). Development and psychometric properties of the organizational trust inventory. Evaluation Review, 21(5), pp. 614–635. Available at: doi: 10.1177/0193841x9702100505 
  76. Olshavsky, R. W. and Kumar, A. (2001). Revealing the actual roles of expectations in consumer satisfaction with experience and credence goods. Journal of Consumer 
  77. Satisfaction, Dissatisfaction, and Complaining Behaviour, 13. Available at: http://jcsdcb.com/index.php/JCSDCB/article/view/106 [Accessed 1 Oct. 2018].
  78. Pakdil, F. and Aydın, O. (2007). Expectations and perceptions in airline services: An analysis using weighted SERVQUAL scores. Journal of Air Transport Management,         13(4), pp. 229–237. Available at: doi: 10.1016/j.jairtraman.2007.04.001
  79. Park, J. W., Robertson, R. and Wu, C. L. (2004). The effect of airline service quality on passengers’ behavioural intentions: A Korean case study. Journal of Air Transport Management, 10(6), pp. 435-439. Available at: doi: 10.1016/j.jairtraman.2004.06.001 
  80. Rasch, G. (1980). Probabilistic models for some intelligence and attainment tests. Chicago, IL: university of Chicago Press.
  81. Reichheld, F. F. and Sasser, W. E. (1990). Zero Defections: Quality Comes to Services. Harvard Business Review, September/October, pp. 105-111.
  82. Ringle, C. M., Sarstedt, M. and Zimmermann, L. (2011), Customer satisfaction with commercial airlines: The role of perceived safety and purpose of travel. Journal of Marketing Theory and Practice, 19(4), pp. 459 – 472. Available at: doi: 10.2753/mtp1069-6679190407 
  83. Roselius, T. (1971). Consumer rankings of risk reduction methods. Journal of Marketing, 35(1), pp. 56-61. Available at: doi: 10.2307/1250565 
  84. Saha, G. C. (2009). Service quality, satisfaction, and behavioural intentions: A study of low‐cost airline carriers in Thailand. Managing Service Quality: An International Journal, 19(3), pp. 350-372. Available at: doi: 10.1108/09604520910955348
  85. Schiffman, L. G. and Wisenblit, J. L. (2015). Consumer behavior. 11th ed., New Jersey: Pearson. 
  86. Schumacker, R. E. and Lomax, R. G. (2010). A beginner’s guide to structural equation modeling. 3rd ed., New York, NY: Routledge. 
  87. Srisook, P. and Panjakajornsak, V. (2017). Southeast Asian low-cost carrier airline competitiveness: A solution for economic growth. Business and Economic Horizons, 13(4), pp. 536-555. Available at: doi: 10.15208/beh.2017.37                        
  88. Tani, M. (2018). Southeast Asia airlines face yet thinner profits in 2018. Nikkei Asia Review. Available at: https://tinyurl.com/yb5wdk2o [Accessed 1 Oct. 2018].
  89. Tavakol, M. and Dennick, R. (2011). Making sense of Cronbach’s alpha. International Journal of Medical Education, 2, pp. 53 – 55. Available at: doi: 10.5116/ijme.4dfb.8dfd
  90. Telus International. (2017). Improving customer satisfaction in the airline industry. Available at: https://tinyurl.com/ybu75g24 [Accessed 1 Oct. 2018].
  91. Thai Airways Annual Report. (2017). Annual report 2017 Thai Airways International Public Company Limited. Available at: https://tinyurl.com/y83appu6 [Accessed 1 Oct. 2018].
  92. Thai Airways. (2018, July 18). THAI wins three Skytrax Awards 2018. Available at:   https://tinyurl.com/yczgyr9o [Accessed 1 Oct. 2018].
  93. The International Trade Administration. (2018). Thailand – Aviation. U.S. Department of Commerce. Available at: https://tinyurl.com/yb8sylrb [Accessed 1 Oct.    2018].
  94. TIBCO. (2017). Airline customer loyalty and improving your bottom line with data you already have. Available at: https://tinyurl.com/ydz4tmra [Accessed 3 Oct. 2018].UNWTO. (2018). UNWTO tourism highlights 2017 edition. United Nations World 
  95. Tourism Organization. Available at: https://tinyurl.com/ybvjmows [Accessed 1 Oct. 2018].
  96. Yang, K-C., Hsieh, T-C., Li, H. and Yang, C. (2012). Assessing how service quality, airline image, and customer value affect the intentions of passengers regarding     low-cost carriers. Journal of Air Transport Management, 20, pp. 52-53. Available at: doi: 10.1016/j.jairtraman.2011.12.007 
  97. Vuthisopon, S. and Srinuan, C. (2017). Low cost carrier passenger repurchase intention: A structural equation model analysis. Asia-Pacific Social Science Review, 17(2), pp. 249–266. Available at: https://tinyurl.com/y88zbfey [Accessed 1 Oct. 2018].
  98. Wan, C. (2017). AirAsia: The journey to becoming a digital airline has begun. WIT. Available at: http://tinyurl.com/mph2uzd [Accessed 1 Oct. 2018]. 
  99. Zeithaml, V. A., Parasuraman, A. and Berry, L. L. (1990). Delivering quality service.     Balancing customer perceptions and expectations. New York, NY: The Free Press.