Authors: William JEN & Tang-Jung LU 2003/10/29

1. Effects of Service Quality, Customer Satisfaction and Switching Barriers on Passenger Behavior Intensions in Scheduled Coach Service Authors: William JEN & Tang-Jung LU 2003/10/29

2. OUTLINE 1. INTRODUCTION 2. LITERATURE REVIEW 3. PROPOSED MODEL AND HYPOTHESES 4. METHODS AND MATERIALS 5. RESULTS 6. DISSCUSSION

3. 1. INTRODUCTION • The opening of national freeway route in Taiwan • Increasing the level of competition • Companies became interested in passenger behavioral intentions • Research on traveler behavior • Objective and quantifiable variables, such as fare, frequency, traveling time and waiting time (Ortuzar and Iacobelli, 1998; Ferrari, 1999 )

4. Research on marketing • Subjective and difficult to quantify latent variables, such as service quality, service sacrifice, service value, customer satisfaction and switching barriers (Fishbein and Ajzen, 1975; Ravald and Gronroos, 1996) • Most of the studies only confirmed the relationships between three or four latent variables.

5. Purposes • To consider all the above-mentioned latent variables in an integrated model. • Using Linear Structural Relation (LISREL) to test the model and hypotheses.

6. 2. LITERATURE REVIEW 2.1 Service Quality (SQ) • Parasuraman, Zeithaml and Berry (1985, 1988) • The comparison results of expected and perceived service. • Tangible, Reliability, Responsiveness, Assurance and Empathy.

7. 2.2 Service Sacrifice (SS) • Heskett et al.(1990) What is given up or sacrificed to acquire a service. • Zeithaml(1988); Dodds et al. (1991) Perceived monetary and non-monetary price 2.3 Service Value (SV) • Dodds and Mornoe (1985); Lovelock (2000) A trade-off between perceived benefits and perceived costs.

8. 2.4 Customer Satisfaction (CS) • Woodruff et al. (1993) An evaluation of an attitude. • Rust and Oliver (1994) An evaluation of an emotion. 2.5 Switching Barriers (SB) • Jones et al. (2000) • Any factor which increases the difficulty for customers in changing provider. • Interpersonal Relationships, Perceived Switching Costs, Attractiveness of Alternatives.

9. 2.6 Behavioral Intentions (BI) • Zeithaml et al. (1996) • Agood predictor of company financial consequences. • Comment positively, Recommend to other consumers, Remain loyal, Spend more with the company, Pay a premium for the service. 2.7 Integrated Model • Dodds et al. (1985); Zeithaml (1988); Lee and Cunningham (1996); Oh (1999) • SQ→ SV, CS and BI • SV→ CS and BI • CS→ BI

10. Cronin, Jr. et al. (2000) constructed a model with 5 latent variables.

11. 3. PROPOSED MODEL AND HYPOTHESES

12. 4.METHODS AND MATERIALS 4.1 Measurements (1) SQ (Jen and Hu, 2000) • Interaction with Passengers, with six questions • Tangible Service Equipment, with six questions • Convenience of Service, with five questions • Operating Management Support, with three questions (2) SS (Zeithaml, 1988) • Monetary price: Fare • Non- Monetary price: Out of vehicle time, Waiting Time, In Vehicle Time

13. (3) SV (Dodds et al., 1991; Brown et al., 1993) • The company’s service is valuable. • The company’s service based on certain price is acceptable. • It is worthier to travel by this company’s coach than the other coach companies or modes. (4) CS (Westbrook and Oliver, 1991) • Emotion words: Interest, Enjoyment, Surprise, Anger, Shame/Shyness • Overall Satisfaction: The company’s service satisfied me.

14. (5) SB (Rusbult, 1980; Gremler, 1995; Ping, 1993) • Interpersonal Relationships, with two questions • Perceived Switching Costs, with three questions • Attractiveness of Alternatives, with three questions (6) BI (Zeithaml et al., 1996) • Remain loyal, with one questions • Recommend to others, with one questions • Spend more with the company, with one questions

15. 4.2 Analysis • Using Linear Structure Relationship (LISREL) to analyze the proposed model. • Two-Step Procedure (Anderson and Gering, 1988) • Confirmatory Factor Analysis (CFA) • Path Analysis

16. 4.3 Data Collection • Research Subjects • Taipei-Tainan route (302 km), with 4 companies. • Taichung-Kaohsiung route (189 km), with 4 companies. • Survey Method • Questionnaires were distributed randomly in the waiting rooms and passengers were requested to mail the completed questionnaires back to us.

17. 5. RESULTS 5.1 Sample and Data 5.1.1 Valid Response Rate

18. 5.1.2 Sample Frame • 571(52%) passengers were male, • 684(62%) passengers were aged 20-29, • 482(44%) passengers were students, • 500(46%) passengers had average incomes of under NTD 10,000 a month, • 456(43%) passengers traveled by scheduled coach two to four times per season • 520(48%) passengers were traveling to return home.

19. 5.2 Confirmatory Factor Analysis (CFA) ※GFI=goodness of fit index; AGFI=GFI adjusted for degrees of freedom; RMR=root mean square residual; NFI=normed-fit index; NNFI=non-normed-fit index; CFI=Bentler’s fit index ※ χ2∕df＜5; GFI＞0.9; AGFI＞0.9; RMR＜0.05; NFI＞0.9; NNFI＞0.9; CFI ＞0.9 ※First model 1: Delete V10 (Anger), First model 2: Delete V11 (Shame/Shyness)

20. Properties of Revised Measurement Model

21. 5.3 Path Analysis *** denotes a significant value (p<0.001); ** denotes a significant value (p<0.05)

22. 6. DISSCUSSION 6.1 Conclusion • All the hypotheses are verified, except H8 (The effect of interpersonal relations on behavioral intentions). • Service Value is the key influence on passenger satisfaction and behavioral intentions. • Service Sacrifice is the key influence on service value.

23. 6.2 Managerial Implication • Increasing service value by reducing service sacrifice • Setting reasonable fares • Reducing out of vehicle time • Reducing passenger perception of waiting time and in vehicle time

24. 6.3 Suggestions for Future Research • Other latent variables should included in the model, such as trust and user involvement. • Further analyses about the switching barriers for alternative transportation modes. • Comparing the difference between each routes or different passengers.

25. THE END