Gadjah Mada International Journal of Business – September-December, Vol. 17, No. 3, 2015

Gadjah Mada International Journal of Business
Vol. 17, No. 3 (September-December 2015): 203-218

Is Physical Evidence Still Valid?
A Study of Low Cost Carriers in Indonesia
Yasintha Soelasih
Atma Jaya Catholic University of Indonesia, Jakarta

Abstract: Physical evidence has been widely accepted as variable that has impact on satisfaction, specifically in airline service. However, this study showed some opposite result for low cost airlines in Indonesia.
It revealed that physical evidence has no effect on the passengers’ satisfaction but the fares and its service
quality to passengers.’ This study collected sample of 317 passengers from commercial domestic flights at
terminal 1, 2, and 3 at Soekarno Hatta airport in Cengkareng, Indonesia. The variables used in this study
were: fares, service quality, physical evidence, passengers’ satisfaction levels and repeat buying. Two variables, i.e.: service quality and physical evidence were treated as second order. This study used Structural
Equation Modeling (SEM) for verification analysis. The result revealed that there was no effect of physical evidence on the passengers’ satisfaction. It also found that repeat buying demonstrated the passengers’
satisfaction.
Abstrak: Lingkungan fisik telah diterima secara luas sebagai variabel yang memiliki dampak pada kepuasan,
khususnya di perusahaan penerbangan. Namun, penelitian ini menunjukkan hasil yang berlawanan untuk
penerbangan murah di Indonesia. Ini mengungkapkan bahwa lingkungan fisik tidak mempunyai pengaruh
terhadap kepuasan tetapi tarif dan kualitas pelayanan yang mempunyai pengaruh terhadap kepuasan
penumpang. Penelitian ini menggunakan sampel sebanyak 317 penumpang penerbangan domestik komersial
pada terminal 1, 2, dan 3 di bandara Soekarno Hatta Cengkareng, Indonesia. Variabel yang digunakan
dalam penelitian ini adalah: tarif, kualitas pelayanan, lingkungan fisik, tingkat kepuasan penumpang dan
penggunaan kembali. Dua variabel, yaitu: kualitas pelayanan dan lingkungan fisik menggunakan dimensi .
Penelitian ini menggunakan Structural Equation Modeling (SEM) untuk analisis verifikasi. Hasil penelitian
menunjukkan bahwa tidak terjadi pengaruh lingkungan fisik terhadap kepuasan penumpang. Bila terjadi
kepuasan penumpang maka akan menimbulkan penggunaan kembali.

Keywords: fares; passengers’ satisfaction; physical evidence; repeat buying; service quality
JEL classification: M31

* Corresponding author’s e-mail: sinthajkt@yahoo.com
ISSN: 1141-1128
http://journal.ugm.ac.id/gamaijb

203

Soelasih

Introduction
The growth of airlines in Indonesia began after the deregulation of the airline industry in 1999. Since then, the growth of the
airlines has led to a high level of competition
among them and also competition in terms
of the service they provide. According to
Ministerial Regulation No. 26 of 2010 Concerning Tariff Mechanism Formulation and
Calculation of Upper Economy Class Passenger Air Transportation Services l Domestic
Commerce, clause 1 paragraph 9-11, Airlines
should provide public transportation, their
types of service can be divided into three
categories, namely full service, medium service and no frills service.
Public transportation (Chase 1978;
1981) generally includes the pure services and
high contact. Airlines, on the other hand, can
also be viewed with perspective of interaction and customization on one side and labor
intensity on the other side (Schemener 1986).
According to Schmenner (1986: 25), the airline transportation industry included service
factory which had a low degree of interaction and customization, as well as a low degree of labor intensity. An airline’s emphasis
is on its service quality (Chang and Yeh 2002;
Liou et al. 2011) so that it can compete with
its rivals in the long run. Further, many researchers claimed that airline companies using competitive advantage in their rates cannot last for very long, compared to those companies using service quality for their customers (Chang and Yeh 2002; Jou et al. 2008).
There are two service quality paradigms,
i.e.: the disconfirmation paradigm and the attitudinal paradigm (Buttle 1996). It is believed
that SERVQUAL is based on the adoption
of the literature of disconfirmatory customer
satisfaction (Parasuraman et al. 1985). Furthermore, Parasuraman et al. (1985) showed

204

the gap between perception and expectation
in consumers, by identifying 10 components
of the service quality. They continued their
research during 1988, which resulted in promoting the 10 components of service quality into five dimensions, namely reliability,
assurance, tangibles, empathy, and responsi veness, with a 22 item questionnai re
(Parasuraman et al. 1988).
In contrast, Cronin and Taylor (1992;
1994) said that the SERVQUAL paradigm
that referred to disconfirmatory satisfaction
didn’t succeed. They said that the quality of
the services received was because of the attitude of the consumers towards the performance of the service, so it was a performance
measure that should be used. Therefore,
Cronin and Taylor, modified SERVQUAL to
SERVPREF.
The quality of service received by consumers will affect their satisfaction, retention
and positive word-of-mouth (Buttle 1996).
Research from Saha and Theingi (2009)
proved that the level of the quality of service provided had a direct impact on air transport passengers’ satisfaction. Satisfaction is
a subjective matter and can be felt after the
purchase and consumption experience (Um
et al. 2006). The disconfirmation paradigm
can be used as a reference in evaluating or
comparing the performance of the products
received with the expectation (Um et al.
2006). Kozak (2001b) distinguished that the
satisfaction of attitude before the decision
could be changed, as a result of the satisfaction. Therefore, the notion of satisfaction is
that it is the end of the buying decision process (Um et al. 2006).
Moreover, the price of the fare also affects passengers when making a purchase.
When air transport rates are cheaper than
other modes of transportation, many passen-

Gadjah Mada International Journal of Business – September-December, Vol. 17, No. 3, 2015

gers will switch. Indeed, in addition to Rao
and Monroe (1989), it is suggested that lower
fares should always be supported with good
service quality.
The services marketing mix (Lovelock
and Wirtz 2011: 47) stated one item that
should be focused on in the airlines’ service
is the physical evidence or physical environment or ‘servicescape.’ Physical evidence is
visual or other good clues that provide evidence of the service quality (Lovelock et al
2011: 622). According to Zeithaml et al.
(2006), physical evidence was required in
service because it could bring satisfaction to
the customers. Given that, it can be argued
that while service quality will affect customer
satisfaction (Baker and Crompton 2000; Williams and Soutar 2009), fares and physical
evidence will also do the same (Bitner 1990).
The meaning of customer satisfaction
is important. Like other service industries, a
satisfied passenger (or customer) is more likely
to do a repurchase action (Blackwell et al.
2006). From their study, it implied that customer satisfaction can be measured by the
consumers’ evaluation actions after consuming products or services. The results of the
evaluation lead to a repurchase action when
the assessment is positive, and no repurchase
action when it is negative. The repurchase
action is, by far, the strong indication for a
sustainable business. For example, Gupta et
al. (2004) indicated that an increase of 1 percent in reuse can increase the firm’s value by
5 percent. The same thing was said by
Reichheld and Sasser (1990) who showed an
increase of 5 percent can increase profits by
between 25 percent-85 percent.
Based on the above research, it can be
argued that the problem with increased competition among airlines has spread not only
into fares but also in the service quality, and
the physical evidence that causes changes in

satisfaction and repurchase. Thus, the issue
to be discussed in this topic is how much influence do fares, service quality and physical
evidence have on satisfaction and repeat buying?

Literature Review
Dodds et al. (1991) described the conceptual relationship between quality, price,
and value; all of which have an influence on
the willingness to purchase. Their results
showed the effect of price on willingness to
buy. Price can measure the degree of sacrifice needed to buy the product, and the size
of the level of quality. A high price becomes
the basis for a perceived high quality and
causes a willingness to buy. But at the same
time, a higher price indicates a higher amount
of money spent, so that the sacrifice action
is necessary to buy the product, and this becomes the basis for the loss of willingness to
buy. Therefore, the negative effect occurs
between the perceived sacrifice for the perceived value (Dodds et al. 1991).
Sweeney et al. (1996) also supported
Dodds et al. (1991) and showed the negative
effect of the relative price to the value and
the willingness to buy. From these research
works, we can claim that there is a negative
effect between price and value on the willingness to buy. Price is one of the most important factors in decision making by consumers (Srivastava and Lurie 2001) and appropriate prices for consumers will have a
long term impact on customer retention
(Kukar and Kinney 2006).
The dimensions of service quality use
2 ways, i.e.: (1) MCDM (Multiple Criteria
Decision-Making) with statistical tests and (2)
VIKOR (Multicriteria Optimization and
Compromise Solution). (Liou et al. 2011).

205

Soelasih

The MCDM method is used on the basis of
the existing five dimensions. The modified
VIKOR method is used to solve the problem
without having to use a dimension that has
been used by other researchers, so that the
dimensions can be taken from the problem.
The modified VIKOR method was introduced by Opricovic and Tzeng (2004).
They developed the dimensions of service
quality in relation to the specific problem.
Research conducted by Liou et al. (2011),
used a modified VIKOR about the quality of
an airline’s domestic services. In the aviation
industry, research conducted by Nadiri et al.
(2008) mentioned the quality of service in
term s of fi ve different di mensi ons of
SERVQUAL, called AIRQUAL. Nevertheless, the AIRQUAL dimensions were derived
from SERVQUAL and aimed specifically at
airlines service quality.
With airlines, there are many issues
which can emerge, such as passenger complaint rates because of frequently delayed
departures, or the cancellation of scheduled
flights, baggage issues, and poor customer
relations (Taylor 2001). In general, the quality of aviation services is driven by 10 main
factors, namely timeliness, check-in, flight
schedules, seat comfort, the location of the
entrance, the interior of the aircraft, flight
attendants, service after the flight, food service and pilots’ on-duty hours (Glab 1998).
Consumer complaints about flights included
complaints about the purchase of tickets,
ticket refunds, rates, customer services, advertising and other problems, and also about
timing issues, problems with boarding, and
baggage handling. (Rhoades and Waguespack
2008). Consumers also expressed anger about
problems with flights, flight delays and cancellations, differing models for pricing, flight
restrictions, and airline/airport employees.

206

The airlines are a service industry, so they
should provide a good quality of service to
their consumers (Rhoades et al. 2008). ISO
14001 emphasized improving customer satisfaction, the airlines’ image and reputations,
and increased domestic market share (Korul
2005: 54). Interpersonal relationships are a
key factor to reduce consumer dissatisfaction
but are very often associated with the place
or environment where the service was provided. The place is instrumental in delivering an image of good quality service. This
concept is called ‘servicescape’ (Edvardsson
and Strandvik 2000: 89). Some studies by Hu
and Burning (1978); Rietchie et al. (1980);
and Abraham (1983), split flight services into
four stages as follows.
1. Pre-journey, this is the process of the service provided to passengers prior to their
flight. This includes information schedules,
flight routes, reservations and booking the
ticket.
2. Pre-flight services to passengers who are
going to fly. At this stage, the activities at
the airport include: The check-in process,
checked baggage handling, waiting room/
lounge facilities, and the boarding process.
The airlines are highly dependent on the
existing facilities and infrastructure at the
airport.
3. In-flight or onboard is the service provided
to passengers during the flight. The services include seat width and leg room, cabin
and seat cleaning, food and beverage service, information and reading services, toilets, and general cabin crew service.
4. Post-flight services are those provided to
the passengers after their flight is completed. These services include baggage retrieval, connecting flight information, lost
baggage handling, and management complains.

Gadjah Mada International Journal of Business – September-December, Vol. 17, No. 3, 2015

This research offers a continuation of
the work by Liu et al. (2011), by establishing
the quality of services applying the 4 stages
listed above of pre-journey, pre-flight, inflight and post-flight. This study also incorporated the indicators used by Liou et al.
(2011) in developing the questionnaires.
Bitner (1992), introduced a model of
environmental psychology and developed a
comprehensive model, named ‘servicescape.’
Bitner found out that a psychological environment may have impact on customers.
They can feel happy or sad towards the service environment. Happy customers can lead
to an action to purchase or repurchase the
offered service while the unhappy one will
likely cancel the purchase or repurchase action. Hence, Bitner developed further relation between service and scape, merged into
“serviscape” or also known as physical evidence.
‘Servicescape,’ as proposed by Bitner in
1992 is still a good reference. Lovelock; et.al.
(2011) and Zeithaml et al (2009) used it
when explaining the service environment or
the physical evidence. Physical appearance
affects consumers by improving their satisfaction (Bitner 1992). The physical appear-

ance of the airline must be considered, because its effect on satisfaction will lead to
customer retention.
Therefore, it can be argued that physical appearance can be treated separately from
the concept of service quality itself since its
presence is dominant. The presence of physical appearance can also negate the meaning
of tangible. This study proposes to separate
the physical appearance aspect from service
quality, and find its significance throughout
the overall model. It is sug gested that the
presence of physical evidence can stand
alone, and affect satisfaction without being
associated with quality. This will be a contribution by this research to its predecessors.
A satisfied customer is more likely to
use that particular airline again (Oliver 1999;
Stewart 1997; and Reichheld 1996). The satisfied consumer will come back and spend
more money due to the level of satisfaction
experienced from previous purchases (Jones
and Sasser 1995; Hig gins 1997; and Lewis
1998). According to Yi and La (2004), Yi
(1990), satisfaction can be measured by the
number of complaints, return business and
positive word-of-mouth referrals. When satisfaction is created, the customer will buy the

Figure 1. The Research Model
Fares


H1



H2






Service
Quality

Passenger’s
Satisfaction

H4


Repeat
Buying



H3


Physical
Evidence

207

Soelasih

product or service again. Therefore, we can
use repeat buying as a measure of satisfaction.

H4. There is an influence from passengers’ satisfaction on repeat buying

Given all the discussions above, this
research proposes the research model as Figure 1.

Passenger’s satisfaction causes repeat
buying (Chen 2008). Consumer satisfaction
is an antecedent which causes the repeat buying (Bukhari et al. 2013).

Hypotheses

Methodology

H1: There is an influence by fares on passengers’
satisfaction.

Sampling was done using cluster random
sampling. The potential samples were passengers present at Soekarno-Hatta airport. The
number of samples totaled 317 passengers,
arrived at using random counting. This research performed reliability and validity tests
for all the variables used in this study. The
reliability test results, listed in Table 1,
showed that all of the variables studied were
rel iabl e wi th a val ue above 0.7. The
reliability’s measurement scale should have a

Passengers’ satisfaction can occur when the fare
that is charged matches the benefits received, and
if they are not appropriate, then that can cause
dissatisfaction (Lapre and Tsikriktis 2006,
received value for fares cause satisfaction Grace
2005).
H2: There is an influence by service quality on passengers’ satisfaction
Service quality, if carried out well, will give rise
to satisfaction. With increasing competition
among the airlines, service quality becomes important for the strategic planning/management
of a company (Chang and Yeh 2002; and Buttle
1994).
H3: There is an influence from the physical evidence
on passengers’ satisfaction.
The physical evidence comprises the
ways in which customers can be attracted to
and/or satisfied by a firm’s services (Bitner
1992; Ryu et al. 2012). The influence of these
tangibles and intangibles upon service quality is a widely debated issue by the marketing
literature, despite the apparent lack of consensus on the relative importance of every
dimension (Pantouvakis and Lymperopoulos
2008). Therefore, in the service marketing
mix, we propose physical evidence as a measurement to declare the presence of tangibles
in services (Lovelock et al. 2009).

208

Table 1. Result of Reliability
No.

Sub Variable/
Variable

Cronbach’s
Alpha

1

Fares

0.797

2

Information

0.835

3

Ticket

0.880

4

Check-in

0.832

5

On time

0.860

6

In-flight

0.824

7

Post-flight

0.896

8

External

0.817

9

Internal

0.885

10

Satisfaction

0.925

11

Repeat

0.770

X1
X2
X3
X4
X5
X6
X7
X8
X9
X10
X11
X12
X13
X14
X15
X16
X17
X18
X19
X20
X21
X22
X23
X24
X25
X26
X27
X28
X29
X30
X31
X32

0.694
0.652
0.529
0.781
0.636

Indicators Fares

0.656
0.692
0.802
0.810
0.625

Inform

Table 2. Result of Validity

0.707
0.663
0.658
0.650
0.685
0.752
0.740
0.742

Ticket

0.724
0.773
0.765
0.726

Check-in

0.789
0.927
0.764

On Time

0.710
0.765
0.811
0.668

In-Flight

0.661
0.772
0.758

Post-Flight

External

Internal

Satisfaction Repeat

Gadjah Mada International Journal of Business – September-December, Vol. 17, No. 3, 2015

209

210

X34
X35
X36
X37
X38
X39
X40
X41
X42
X43
X44
X45
X46
X47
Y1
Y2
Y3
Y4
Z1
Z2

Indicators Fares

Table 2. (Continued)

Inform

Ticket

Check-in

On Time

In-Flight
0.804
0.809

Post-Flight

0.819
0.761
0.796
0.648

External

0.795
0.701
0.793
0.769
0.781
0.616
0.566
0.702

Internal

0.839
0.884
0.865
0.880
0.812
0.772

Satisfaction Repeat

Soelasih

Gadjah Mada International Journal of Business – September-December, Vol. 17, No. 3, 2015

Cronbach Alpha value of at l east 0.70
(Nunnally 1978; Nunnaly and Bernstein
1994).
Test validity using confirmatory factor
analysis, and validity of test results, presented
in Table 2. The validity of the test results
showed that all indicators can shape the dimensions and variables studied, with a value
above 0.5. The reliability and validity of the
test results showed that all of the variables
were eligible for use in this study.
After testing the validity and reliability,
we then tested the model using a Structural
Equation Model.

Test results of the suitability models
based on chi-square/degrees of freedom,
RMSEA, SRMR, NFI, NNFI, and CFI, as
shown above, produced an acceptable model,
although the assessments that were based on
chi-square, p value, GFI and AGFI generated
suitability test of the model were only a marginal fit. However, Hu and Bentler (1998)
recommended the use of SRMR, supplemented by NNFI, CFI, or RMSEA derived
from ML and GLS estimations for goodness
of fit. This research used the Maximum
Likelihood (ML) method for the SEM. Overall, the model test results of the model explained the relationship between the variables

Table 3. Test Results Suitability Model (GOF)
Fit Measure

Good Fit

Acceptable Fit

Estimated

2 (Chi-square)

0  2 2df

2df   2  3df

2 = 2903.36

p value

0.05 < p < 1.00

0.01  p 0.05

p-value = 0.00

2/df

0  2 /df  2

2 <  2/df  3

2.22

RMSEA

0  RMSEA  0.05

0.05  RMSEA  0.08

0.07

P value for test of
close fit
(RMSEA < 0,05)

0.10  p  1.00

0.05  p  1.00

0.00

Confidence interval

0  SRMR  0.05

0.05  SRMR  0.10

0.07

NFI

0.95  NFI  1.00

0.90  NFI  0.95

0.96

NNFI

0.97  NNFI  1.00

0.95  NNFI  0.97

0.98

CFI

0.97  NNFI  1.00

0.95  NNFI  0.97

0.98

GFI

0.95  NNFI  1.00

0.90  NNFI  0.95

0.73

AGFI

0.90  AGFI  1.00
close to GFI

0.85  AGFI  0.90
close to GFI

0.70

Source: Engel et al. (2003)
Models: Tests of Significance and Descriptive Goodness-of-Fit Measures and estimated

211

Soelasih

of fares, service quality, physical evidence,
passengers’ satisfaction and the repeat buying of domestic commercial flights with low
cost carriers in Indonesia.

Analysis and Result

Table 4 shows that most passengers had
a bachelors degree (S1), most worked as private company employees, and the majority
were between the ages of 21-30 years old.
The data showed that the passengers were
people who were highly mobile, so they deTable 4. Passengers Characteristics
Information

Amount

Persentase (%)

Gender:
Male
Female

237

74.8

80

25.2

18
110
88
67
29
5

5.7
34.7
27.7
21.1
9.1
1.7

90
39
138
38
1.

28.4
12.3
43.5
12.0
0.4

18
54
105
112
28

5.7
17.0
33.1
35.3
8.9

Educations:
High school
Diploma
Undergraduate
Graduate
Doctoral Degree
Others
Jobs:
Student
Entrepreneur
Government employees
Private employees
Others

212

Overal Structural Model and
Hypothesis Testing
The results of the data processing to
answer the hypotheses under study using
SEM with Lisrel program are as Table 5.

Passengers’ Characteristics

Age:
< 20 years
21 – 30 years
31 – 40 years
41 – 50 years
51 – 60 years
> 60 years

sire and expect on-time travel performance
when using air transportation.

The results of testing Hypotheses 1, 2,
and 4 individually showed the H0 was rejected,
so that H1 was accepted, which means that
for each test between fares and service quality, they both influenced the passengers’ satisfaction. Passengers’ satisfaction also had an
influence on repeat buying. Meanwhile, hypothesis 3 for H1 was rejected, as physical
evidence had no effect on the passengers’ satisfaction.
However, from the overall equation result as Equation 1, the physical evidence was
not significant. It means that the physical evidence did not have any impact on passengers’ satisfaction.
satisfac= 0.347*fares + 0.403*servqual
(0.0794)
(0.135)
4.365
2.985
+ 0.125*physical, Errorvar.=
(0.134)
0.931
0.333, R²= 0.667
(0.0429)
7.775 .................................(1)
The equation shows that the physical
evidence does not have any impact on passengers’ satisfaction, as shown by the value
of t being below 1.96. It meant that the important variables in shaping passengers’ sat-

Gadjah Mada International Journal of Business – September-December, Vol. 17, No. 3, 2015

Table 5. Hypotheses Testing Fares, Service Quality, and Physical Evidence of Passenger Satisfaction
No.

Hypothesis

Path
Coefficient

t-value

t-table

Result

Conclusion

1.

The effect fares
toward passenger’s
satisfaction

0.347

4.365

1.96

significant

H0 is rejected, there
is influence between
fares to passenger’s
satisfaction

2.

The effect service
quality toward
passenger’s
satisfaction

0.403

2.985

1.96

significant

H0 is rejected, there
is influence between
service quality to
passenger’s
satisfaction

3.

The effect physical
evidence toward
passenger’s
satisfaction

0.125

0.931

1.96

no
significant

H0 is accepted, there
is no influence
between physical
evidence to
passenger’s
satisfaction

4

The effect passenger’s
satisfaction toward
repeat buying

0.843

13.708

1.96

significant

H0 is rejected, there
is influence between
passenger’s
satisfaction to
repeat buying

isfaction with low cost carrier airlines in Indonesia were their fares and service quality.
The overall results from LISREL are
shown at Figure 4. Passengers still consider
that the physical evidence is a part of the service quality, which was why the difference
between the physical evidence and service
quality was not visible during testing. Arguably, the difference will be visible when there
is a clear distinction between the service quality and physical evidence. Parasuraman
(1985) stated that service quality had five
dimensions, namely tangible, reliability, responsiveness, empathy and assurance. Tangible overlaps with physical evidence. Bitner

(1992) proposed the theory, which was later
established by Lovelock et al. (2011) and
Zeithaml et al. (2009), in which they stated
the variable ‘servicescape’ or physical evidence, was one of the variables in the service marketing mix besides service quality.
In relation to these theories, this study
attempted to split the service that is part of
service quality, with the six dimensions of
information, ticketing, check-in, on-time performance, in-flight and post-flight, while the
tangible physical evidence variable was used
with two external and internal dimensions.
Hence, the emphasis on service quality was
something that was assessed on the intan-

213

Soelasih

gible, while the physical evidence was on the
tangible. The results of the research showed
that something which was felt by passengers
raised their level of satisfaction higher than

something that could be seen by them. This
was what caused physical evidence to have
no influence on passengers’ satisfaction.

Figure 4. Output Lisrel
0.26
0.26
0.21
0.22
0.45
0.49
0.64
0.64
0.56

0.40
0.26
0.29
0.51

0.51
0.45
0.60
0.60
0.60
0.59
0.51
0.55

inform
ticket
0.59

0.20

X1
X2

0.51

0.90
0.70

0.50

X3

0.70
0.95
0.70

ontime
inflight

0.50
0.60
0.60
0.55

0.95
0.45

0.49

check in

0.00

Fares
0.49

0.60
0.60
0.50
0.50

0.90

postflight

Servqual

0.50
0.59
0.66
0.60
0.69
0.71

ex

0.69
0.35
0.00

0.49

X4

0.57

Physical

0.92

in

0.40
0.40

X5

0.57
0.51
0.59
0.60

0.12

0.54
0.41
0.26
0.22
0.25
0.06
0.01
0.24
0.07
0.15
0.40
0.22
0.25
0.26
0.21
0.07
0.22
0.24
0.02
0.23
0.26
0.27
0.16

0.60
0.71
0.60
0.54
0.55
0.47
0.56
0.50

satisfac

0.04

0.19
0.20
0.55
0.20
0.50
0.22
0.20

0.91
0.96
0.06
0.06

repeat

0.19
0.06
0.66
0.29
0.05

0.69
0.66

0.25
0.25
0.22
0.25
0.20

214

Gadjah Mada International Journal of Business – September-December, Vol. 17, No. 3, 2015

Conclusion
This study confirmed that the fares passengers have to pay had a positive influence
on their satisfaction, which was different from
the study of Dodds et al. (1991) and Sweeney
et al. (1996). Their results showed that the
relative price had a negative effect on the
perceived value.
This study also showed that the discussion on service quality dimensions can be
formed out of the proposed problems. The
result indicated that there were six dimensions that consist of information, ticketing,
check-in, on-time performance, in-flight and
post-flight. Hence, these findings also supported the research work by Liou (2011).
Lastly, this study has taken some effort
to separate tangible in the service quality from

the physical evidence, so that the service
quality dimensions studied were intangible.
This differs from the work of previous studies on this topic. However, the results of this
study indicated that the physical evidence did
not have any impact on passengers’ satisfaction, which implied that the tangible dimension cannot be eliminated from the service
quality.
To answer this issue, we propose further research into the effort to distinguish the
difference between service quality and physical evidence. It will make a contribution to
supporting the theory expressed by Lovelock
(2011) that the service needed some additions to the marketing mix, to be called the
service marketing mix, one of which was
physical evidence; and it also supports the
theory of the ‘servicescape’ by Bitner (1992).

References
Abraham, M. 1983. A service quality model in air travel demand: An empirical study. Transportation
Research 17A (5): 385-393.
Baker, D. A. and J. L. Crompton. 2000. Quality, satisfaction and behavioral intentions. Annals of Tourism
Research 27 (3): 785-804.
Bitner, M. J. 1990. Evaluating service encounters: The effects of physical surroundings and employee
responses. Journal of Marketing 54 (April): 69-82.
Bitner, M. J. 1992. ‘Servicescape’: The impact of physical surroundings on customers and employees.
Journal of Marketing 56 (April): 57-71.
Blackwell, R., C. D’Souza, M. Taghian, P. Miniard, and J. Engel. 2006. Consumer Behaviour : An Asia Pacific
Approach. Thomson: 171.
Bukhari, S. M. F., A. Ghoneim, C. Dennis, and B. Jamjoon. 2013. The antecedents of travellers’ e-satisfaction and intention to buy airline tickets online, a conceptual model. Journal of Enterprise Information
Management 26 (6): 624-641.
Buttle, F. 1996. SERVQUAL: review, critique, research agenda. European Journal of Marketing 30 (1): 8-32.
Chang, Y-H., and C-H. Yeh. 2002. A survey analysis of service quality for domestic airlines. European
Journal of Operational Research 139, 166-177.
Chase, R. B. 1978. Where does the customer fit in a service operation? Harvard Business Review 56 (6)
(November-December): 137-142.

215

Soelasih

Chase, R. B. 1981. The customer contact approach to services: Theoretical bases and practical extension.
Operations Research 29 (4): 698-706.
Chen, C-F. 2008. Investigating structural relationships between service quality, perceived value, satisfaction, and behavioral intentions for air passengers: Evidence from Taiwan. Transportation Research
(Part A 42): 709-717.
Cronin Jr., J. J. S. A. Taylor. 1994. SERVPERF Versus SERVQUAL: Reconciling performance – based
and perceptions – minus – expectations measurement of service quality. Journal of Marketing 58
(January): 125-131.
Cronin Jr. J. J., and S. A. Taylor. 1992. Measuring service quality: A reexamination and extension. Journal of
Marketing 56 (3) (July): 55-68.
Dodds, W. B.; K. B. Monroe, and D. Grewal. 1991. Effects of price, brand, and store information on
buyers’ product evaluations. Journal of Marketing Research (Aug 28) (3). ABI/INFORM Global.
Edvardsson, B., and T. Strandvik. 2000. Is a critical incident critical for a customer’s relationship? Managing
Service Quality 10 (2): 82-91.
Engel, K. S., H. Moosbrugger, and H. Muller. 2003. Evaluating the fit of structural equation models: Tests
of significance and descriptive goodness-of-fit measures. Methods of Psychological Research Online 8
(2): 23-74.
Glab, J. 1998. The people’s choice. Frequent Flyer (June): 24-8.
Grace, D. 2005. Consumer disposition toward satisfaction (CDS): Scale development and validation.
Journal of Marketing Theory and Practice 13 (2) (Spring): 20-31.
Gupta S., D. R. Lehmann, and A. Stuart. 2004. Valuing customers. J Mark Res 2004;41(1):7–18.
Higgins, K.T. 1997. Coming of Age: Despite Growing Pains, Customer Satisfaction Measurement Continues to Evolve. Marketing News, 1-12.
Hu, L., and P. M. Bentler. 1998. Fit indices in covariance structure analysis: Sensitivity to under parameterized model misspecification. Psychological Methods (3): 424-453.
Hu, M. and E. T. Burning. 1978. A comparison of Enduring and Instrumental product/service importance: The case of the airline traveler. Transportation Practitioners Journal 54: 31-40.
Korul, V. 2005. Guide to the implementation of ISO 14001 at airports. Journal of Air Transportation 10 (2):
49-68.
Kozak, M. 2001b. A critical review of approaches to measure satisfaction with tourist destinations. In J. A.
Mazanec, G. I. Crouch, J. R. B. Ritchie, A. G. Woodside (Edts.), Consumer Psychology of Tourism
Hospitality and Leisure 2. New York: CABI Publishing.
Kukar-K. M. 2006. The role of price-matching characteristics in influencing store loyalty. Journal of Business
Research 59 (4):475-482.
Lapre, M. A., and N. Trikriktsis. 2006. Organizational learning curves for customer dissatisfaction: Heterogeneity across airlines. Management Science 52 (3) (March): 352-366.
Lewis, S. 1998. All or nothing: Customer must be “Totally Satisfied.” Marketing News: 11-12.
Liou, J. J. H., C-Y. Tsai, R-H. Lin, and G-H. Tzeng. 2011. A modified VIKOR multiple-criteria decision
method for improving domestic airlines service quality. Journal of Air Transport Management 17: 5761.

216

Gadjah Mada International Journal of Business – September-December, Vol. 17, No. 3, 2015

Lovelock, C., and J. Wirtz. 2011. Services Marketing People, Technology, Strategy. (7th ed.). Pearson International
Edition: 27-37, 160. 277, 280-283
Jones, T. O. and W. E. Sasser Jr. 1995. Why satisfied customers defect. Harvard Business Review (Nov.-Dec.).
Jou, R-C., S-H. Lam, D. Hensher, C-C. Chen, and C-W. Kuo. 2008. The effect of service quality and
price on international airline competition. Transportation Research (part E): 580-592.
Mangold, G. W., and E. Babakus. 1991. Service quality: The front-stage perspective vs the back stage
perspective. Journal of Services Marketing 5 (4) (Autumn): 59-70.
Nadiri, H., K. Hussain, E. H. Ekiz, and S. Erdogan. 2008. An investigation on the factors influencing
passengers’ loyalty in the North Cyprus national airline. The TQM Journal 20 (3): 265-280.
Nunnally J. C. 1978. Psychometric Theory (2nd ed.). New York: McGraw Hill.
Nunnally J. C., and I. H. Bernstein. 1994. Psychometric Theory (3rd ed.). New York: Mc Graw Hill.
Oliver, R. L. 1999. Whence consumer loyalty? Journal of Marketing 63: 33-34.
Pantouvakis, A., and K. Lymperopoulos. 2008. Customer satisfaction and loyalty in the eyes of new and
repeat customers: Evidence from the transport sector. Managing Service Quality 18 (6): 623-643.
Parasuraman, A., V. A. Zithaml, and L. L. Berry. 1985. A Conceptual model of Service Quality and Its
Implications for Future Research. Journal of Marketing 49 (Fall): 41-50.
Parasuraman, A., V. A. Zithaml, and L. L. Berry. 1988. SERVQUAL: A multiple-item scale for measuring
consumer perceptions of service quality. Journal of Retailing 64 (1).
Rao, A. R., and K. B. Monroe. 1989. The effect of price, brand name, and store name on buyers’
perceptions of product quality: An integrative review. Journal of Marketing Research XXVI (August):
351-7.
Reichheld, F. F. 1996. Learning from customer defections. Harvard Business Review 59.
Reichheld, F., and W. Z. Sasser. 1990. Zero defections: Quality comes to services. Harvard Business Review
68 (5): 105–11.
Rhoades, D. L., and B. Waguespack Jr. 2008. Twenty years of service quality performance in the US
airline industry. Managing Service Quality 18 (1): 20-33.
Richard, M. D. and A. W. Allaway. 1993. Service quality attributes and choice behavior. Journal of Service
Marketing 7 (1): 59-68.
Ritchie, J. R., E. E. Johnston, and V. J. Jone. 1980. Competition, fares and fence-perspective of the air
traveler. Journal of Travel Research 27: 36-42.
Ryu, K., H-R. Lee, and W. G. Kim. 2012. The influence of the quality of the physical environment, food,
and service on restaurant image, customer perceived value, customer satisfaction, and behavioral
intentions. International Journal of Contemporary Hospitality Management 24 (2): 200-223.
Saha, G. C., and Theingi. 2009. Service quality, satisfaction, and behavioral intentions: A study of low-cost
airline carriers in Thailand. Managing Service Quality 19 (3): 350-372.
Schmenner, R. W. 1986. How can service businesses survive and prosper? Sloan Management Review 27 (3)
(Spring): 21-32 (http://www.researchgate.net/publication/12997398_How_Can_Service_
Business_Survive_and_Prosper)
Srivastava, J; and N. Lurie. 2001. A consumer perspective on price-matching refund policies: Effect on
price perceptions and search behavior. Journal of Consumer Research 28 (2): 296-307.

217

Soelasih

Stewart, T. A. 1997. A satisfied customer is not enough. Fortune: 112-113.
Sweeney, J. C., G. N. Soutar, and L. W. Johnson. 1996. Retail service quality and perceived value. Journal of
Retailing and Consumer Services 4 (1): 39-48.
Taylor, L. R. 2001. Miles to go, promises to keep. Government Excutive 33 (4): 81-84.
Um, S., K. Chon, and Y. H. Ro. 2006. Antecedents of revisit intention. Annals of Tourism Research 33 (4):
1141-1138.
Williams, P., and G. N. Soutar. 2009. Value, Satisfaction and Behavioral Intentions in an Adventure Tourism Context. Annals of Tourism Research 3: 413-438.
Yi, Y. 1990. A critical review of consumer satisfaction. Review of Marketing: 68-123.
Yi, Y., and S. La. 2004. What influences the relationship between customer satisfaction and repurchase
intention? Investigating the effects of adjusted expectations and customer loyalty. Psychology and
Marketing 21 (5): 351-373.
Zeithaml, V. A., M. J. Bitner, and D. D. Gremler. 2006. Services Marketing: Integrating Customer Focus Across
Firms (4th ed.) McGraw-Hill International Edition: pp. 4, 5, 22, 26-28, 521-527, 320-321
Zeithaml, V. A., M. J. Bitner, and D. D. Gremler. 2009. Services Marketing: Integrating Customer Focus Across
Firms (5th ed.) McGraw-Hill International Edition. pp: 4, 5, 20, 23-25, 313-321, 353, 519-525.

218