Predicting Airline Customer Loyalty by Integrating Structural Equation Modeling and Bayesian Networks

Abstract

The aviation industry has grown rapidly worldwide and is struggling against intense competition. Especially in Thailand, the compound annual growth rate of passengers traveling by air has increased continuously over the past decade. Unfortunately, during the past two years, the ongoing COVID-19 pandemic has caused severe economic crises for nearly all businesses and industries, including the aviation industry and especially for passenger airlines whose number of customers has decreased astoundingly due to travel restriction. To maintain business stability, therefore, airlines must build customer loyalty to survive in times of crisis. This study thus examines critical factors’ impact on airline loyalty by using a Bayesian network (BN) derived from a structural equation modeling (SEM). The study integrates the SEM and BN to refine causal relationships between critical factors, identified as critical pathways. Findings reveal that customer satisfaction and customer trust, followed by perceived value, dramatically influence customer loyalty and so are considered priorities for building airlines’ customer loyalty. This study also recommends practical strategies and policies to improve customer loyalty amid the competitive airline business during and after the COVID-19 era.

Trust, Value, Price Fairness: Boosting Loyalty in Eco Hair Care

“…According to research by Omoregie et al (2019) trust has a positive and significant influence on customer loyalty. This is in accordance with research conducted by Chanpariyavatevong et al (2021) which shows that trust has a positive and significant impact on customer loyalty. H4: Trust has a positive and significant effect on customer loyalty.…”

“…This shows that positive perceived value will influence customer loyalty when purchasing environmentally friendly hair care products. The results of this study are in accordance with research conducted by Chanpariyavatevong et al (2021) and Kusumawati dan Rahayu (2020) who stated that perceived value has a positive and significant relationship with customer loyalty.…”

“…According to the research by Kusumawati dan Rahayu (2020), perceived value has a positive effect on customer loyalty. Similar findings are also suggested by Chanpariyavatevong et al (2021), stating that perceived value directly influences customer loyalty positively. H5: Perceived value has a positive and significant effect on customer loyalty.…”

Customer Behavioral Trends in Online Grocery Shopping During COVID-19

“…Customer satisfaction is a qualitative descriptive measure and needs statistical analysis with data and sampling to prove the facts (Nedelcu, Dumitrascu and Cristea, 2010). Chanpariyavatevong et al (2021) considered that customer satisfaction measures are a critical factor in predicting customer retention, customer loyalty, attracting new customers and repurchase intentions, which is vital to any product or company.…”

Sustainable Development Strategy of Low-Cost Airlines: Empirical Evidence for Indonesia Based on Analysis of Passenger Loyalty

“…Chanpariyavatevong [38] argues that, among the several factors that affect loyalty, satisfaction is the aspect that most influences L. If a customer does not feel satisfied with the services of an airline, then the customer will use another airline [21]. On the other hand, if the consumer is satisfied with a product, it is highly likely that the consumer will be loyal [8].…”