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FORUM PENYEBARAN DATA HASIL
PENYELIDIKAN LPPKN SIRI 2
8 MEI 2014
HOTEL CRYSTAL CROWN, PETALING JAYA
1 Background of Research
2 Problem Statement
3 Research Question & Objective
4 Literature Review
5 Theoretical Framework
6 Research Methodology
7 Analysis & Findings
8 Discussion & Conclusion
PRESENTATION OUTLINE
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Part of the Condition for the completion of MBA in University of Malaya (2013)
Area of Concentration – MBA - MARKETING
The reason for the topic “Customer Retention” – LPPKN moving towards self suffiency
Benefit – First step in the process of focusing on Business & Marketing
- Improve service delivery, Understanding the Clients
1. RESEARCH BACKGROUND
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2. PROBLEM STATEMENT
LPPKN is planning to focus on customer retention strategy due to the following reason:-
i) Health industry is getting highly competitive with many alternatives service provider
available for client i.e. KKM Clinics, private clinics, NGO (FFPAM)
ii) LPPKN is planning to move towards self-financing by actively involved in business ;
Felda, Tabung Haji as a model. LPPKN is heavily dependent on Government of
Malaysia in term of financing the operation.Service charge increment in 2007 is
insufficient & LPPKN need to find alternative to generate higher income.
iii) Inline with the LPPKN’s corporate vision & mission
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2. PROBLEM STATEMENT
Number of LPPKN Clinics – 58
Services – Reproductive Health
How to improve number of clients?
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What are the factors influencing the process of customer retention in LPPKN’s clinical service setting?
Does service branding, perceived value and service quality influence customer retention in clinical service?
Are some antecedents of customer retention towards clinical service setting are more significant than others?
Does demographic factors have influence on the
process of customer retention?
3. RESEARCH QUESTIONS
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• To analyze the relationship of service branding, perceived value and service quality to customer retention in clinical service settings.
• To examine the influence of service branding, perceived value and service quality in the proposed model of customer retention.
• To measure the importance of service branding, perceived value and service quality on customer retention.
• To analyze the influence and impact of demographic factors in the process of customer retention
3. RESEARCH OBJECTIVES
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Concept Literature Authors
Service
Service is an activity which has some elements of
intangibility associated with it. Service involved
some interaction with customers or property in their
possession and do not result in a transfer of
ownership
Services are different from physical products
because it cannot be stored, but the purpose of
both are same; to satisfy human need and wants.
Services can be termed as “experiential
possession”.
Chernatony &
Segal-Hom, 2003;
McDonald et al.,
2001
Fisher (1935)
Concept Literature Authors
Perceived
Value
Beginning 1990’s a new concept called customer
perceived value has drawn attention in the field of
marketing research
In a broad definition perceived value can be defined
as the benefits that customers received in relation
to the total costs. It can also defined as the
difference between perceived benefits and costs.
Ekram & Fazil, 2007
Woodruff, 1997;
Holbrook, 1994;
Zeithhaml, 1998
4. LITERATURE REVIEW
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Concept Literature Authors
Service
Branding
Brand assigns legal responsibility to the product
maker and provides a promise or bond with the
service provider or producer
Brands appears to reduce customer search costs
SB is a powerful means of differentiation and that
differentiation is significant competitive marketing
strategy.
Lesser et la.,1995
Biswas, 1992
Kapferer (1997),
Kotler (1988)
Concept Literature Authors
Service
Quality
SQ is defined as multidimensional which are
intangibility, heterogeneity and inseparability of
production and consumption.
Service quality can be categorized into 5
dimensions which are tangibles, reliability,
responsiveness, assurance and empathy.
SERVQUAL – widely accepted measurement scale
for service quality.
Medical Service Quality – not only focus on
medical care (doctor & nurse) but also transforms
to be patient-centered.
Parasuraman et al.
(1985)
Bath (2008)
4. LITERATURE REVIEW (cont.)
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Concept Literature Authors
Customer
Retention
Acquiring new customer is calculated as being
five times more costly than the expenses of
retaining existing customer. Long term customers
take less of company’s time, and are less sensitive
to price changes
CR is future propensity of a customer to stay with
the service provider
Repurchase intention is defined as a consumers’
actual behavior resulting in the buying of the same
product or services on more than one occasion.
Perceived value and service quality have an
important and positive relationship with
satisfaction and repurchase intention
(Healy, 1999).
(Ranaweera &
Prabhu, 2003).
(Fiese, 2004).
(Muhammad A.
Raza et al.; 2012)
4. LITERATURE REVIEW (cont.)
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5.2 Development of Hypotheses
H1 – There is a positive relationship between service branding and customer
retention
H2 – There is a positive relationship between perceived value and customer
retention
H3 – There is a positive relationship between service quality and customer retention
5.1 Research Framework
Perceived Value
Service Branding
Service Quality
Customer
Retention
IV
DV H1 +
H2 +
H3 +
5. THEORITICAL FRAMEWORK
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6. RESEARCH METHODOLOGY
• Quantitative
RESEARCH APPROACH
• Questionnaire survey & LPPKN’s annual report
DATA SELECTION
• Unit of analysis – LPPKN Clinics; Respondents – LPPKN Clinical clients
• 10 clinics K.L., Selangor & Negeri Sembilan out of 55 total clinic in Malaysia
SAMPLING POPULATION
• Purposive & convenience non-random sampling
SAMPLING TECHNIQUE
• Self-administered questionnaire, Paper based assessment & back to back translation
• 5 sections consist of 4 section for each construct with 7 point Likert scale & 1 section for demographic profile
QUESTIONAIRE DESIGN
• Total 300 questionnaire distributed with 235 returned (78.3%) whereby 227 are usable.
SURVEY IMPLEMENTATION
• Descriptive analysis, factor analysis, reliability test, correlation analysis, multiple regression & One-way Anova test.
DATA ANALYSIS TECHNIQUES
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Construct Dimensions Items Source
Perceived Value (PV) Functional Value (Installation) 4 Sa’nchez et al., 2006
Functional Value(Price) 4 Ralston, 1999
Functional Value (Professionalism) 5 Sa’nchez et al., 2006
Emotional Value (Control) 7 (Otto, 1997: Otto & Ritchie, 1996)
Emotional Value (Hedonics) 4 (Otto, 1997: Otto & Ritchie, 1996)
Social Value 3 Sa’nchez et al., 2006
Service Branding (SB) Satisfaction (Brand reliability) 3
Danes J.E. et al. (2011) Trust (Brand Fidelity) 3
Personnel Connections (Communalities) 3
Functional Connections (Exchange) 3
Commitment (Loyalty, Investment) 3
Service Quality (SQ) Tangible 4
Parasuraman, Zeithaml & Berry (1988) Reliability 5
Responsiveness 4
Assurance 4
Empathy 5
Customer Retention Customer Retention 3 Thiru Murugan R. & Clement S.J. (2013)
Total 67
6. RESEARCH METHODOLOGY
Operationalization Of Construct
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7. ANALYSIS & FINDINGS
7.1 Descriptive Analysis
83%
5% 8% 4%
RACE COMPOSITION OF THE RESPONDENT
Malay Chinese Indian Others
6%
60%
34%
GENERATION COMPOSITION OF THE RESPONDENT
Baby Boomers 1946-64 Gen X 1965-80 Gen Y 1981-2000
6%
31%
4%
25%
26%
8%
EDUCATION LEVEL OF THE RESPONDENTS
Primary/SRP/PMR SPM/MCE
STPM/HSC/Certificate Diploma
Degree Masters and above
62% 15%
23%
STATE OF DEMOCILE OF THE RESPONDENTS
Kuala Lumpur Selangor Negeri Sembilan / Seremban15
7. ANALYSIS & FINDINGS
7.1 Descriptive Analysis (cont.)
29%
17%
3%
15%
7% 3%
26%
OCCUPANCY OF THE RESPONDENTS
Management / Professional (Private)Management / Professional (Gov.)Middle ManagementGovernment Servant (non-officer)Company / PrivateOwn Business / WorkHousewife / Not Working
15%
31%
34%
11%
5% 4%
INCOME LEVEL OF THE RESPONDENTS
RM1,000 and below RM1001-RM2,000
RM2,001-RM3,000 RM3,001-RM4,000
RM4,001-RM5,000 RM5,001 and above
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Table 4.2 : KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .936
Bartlett's Test of Sphericity
Approx. Chi-Square 19,748.953
df 2016
Sig. .000
Kaiser-Meyer-Olkin (KMO) value of 0.936 and Bartlett’s Test proven
significant (p<0.05), the exploratory factor analysis was considered
appropriate for the test. Principal component analysis was used to
transform the items into related grouping/components.
7. ANALYSIS & FINDINGS
7.2 Factor Analysis
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Rotated Component
Matrixa
Component
1 2 3
Pv26 0.848
Pv25 0.773
Pv23 0.747
Sq1 0.724
Sq4 0.715
Pv22 0.714
Sq2 0.71
Pv19 0.697
Pv20 0.687
Pv12 0.664
Pv16 0.662
Pv11 0.66
Pv24 0.642
Pv10 0.639
Pv21 0.567
Sq8 0.547 0.503
Pv3 0.541
Sq5 0.538
Pv13 0.527
Sq15 0.521
Pv15 0.517
Sq16 0.516
Pv8 0.809
Pv6 0.801
Pv7 0.791
Pv5 0.757
Sb11 0.624
Pv9 0.553
Rotated Component Matrixa
Component
1 2 3
Sq21 .913
Sq19 .887
Sq22 .875
Sq13 .862
Sq20 .843
Sq12 .794
Sq18 .771
Sq11 .698
Sq10 .673
Rotated Component
Matrixa
Component
4 5
Sb12 .800
Sb13 .790
Sb14 .786
Sb15 .742
Sb4 .568
Sq9 .547
Pv1 .516
Sb8 .695
Sb7 .692
Sb9 .677
Sb6 .615
Sb3 .546
Sb10 .507
Principal Component Matrix
Dimension Identification No of Items Description
Perceived Value 28 Component 1 & 3
Service Quality 9 Component 2
Service Branding 13 Component 4 & 5
50 items out of 64 were retained
PV SQ SB
7. ANALYSIS & FINDINGS
7.3 Dimensions of Service Branding, Perceived Value and Service Quality
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5 components explains
65% of variance
Construct No of
Items
Cronbach’s
Alpha
Service Branding 13 0.939
Perceived Value 28 0.978
Service Quality 9 0.954
Customer retention 3 0.871
Cronbach’s Alpha Scores for Dimensions Extracted
50 item out of 64 items + 3 items Customer Retention
+ Demography – 6 items Total 73 items
7. ANALYSIS & FINDINGS
7.4 Reliability Analysis
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0.8-0.9 – v. good > 0.9 - exellent (Sekaran, 2003)
• Bivariate Correlation – relationship between two variables
• 1 or -1 shows linear relationship, + or – shows direction
Service
Branding
Perceived
Value
Service
Quality
Customer
Retention
Service Branding
Pearson
Correlation 1 .563** .390** .458**
Sig. (2-tailed) 0 0 0
N 227 227 227
Perceived Value
Pearson
Correlation 1 .287** .598**
Sig. (2-tailed) 0 0
N 227 227
Service Quality
Pearson
Correlation 1 .407**
Sig. (2-tailed) 0
N 227
Total Customer
Retention
Pearson
Correlation 1
Sig. (2-tailed)
N
7. ANALYSIS & FINDINGS
7.5 Correlation Analysis
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7.6 Multiple Regression Analysis
7. ANALYSIS & FINDINGS
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Model Summaryb
Model R R Square Adjusted R
Square
Std. Error of the
Estimate
1 .652a 0.425 0.417 0.616
a. Predictors: (Constant), Service Quality, Perceived Value, Service Branding
b. Dependent Variable: Customer Retention
Adjusted R Square shows how much variance in DV explained by IV, In
this Research it’s 41.7%. “MODERATE”
ANOVA results shows the Model is Statistically Significant (p< 0.01)
ANOVAa
Model Sum of
Squares df Mean Square F Sig.
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Regression 62.451 3 20.817 54.862 .000b
Residual 84.616 223 0.379
Total 147.066 226
a. Dependent Variable: Total Customer Retention
b. Predictors: (Constant), Service Quality, Perceived Value, Service Branding
CR Equation
• CR = 0.774 + (0.117) SB + (0.575) PV + (0.220) SQ
• CR = Customer Retention Constant = 0.774
• SB = Service Branding PV = Perceived Value
• SQ = Service Quality
Model Unstandardized
Coefficient
Standardized
Coefficient
t Sig.
B Std. Error Beta
(Constant) .774 .397 1.949 .053
Service Branding .117 .075 .100 1.555 .121
Perceived Value .575 .075 .476 7.706 .000
Service Quality .220 .053 .232 4.188 .000
7.6 Multiple Regression Analysis
7. ANALYSIS & FINDINGS
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No Hypothesis Result Conclusion
1. H1 – There is a positive relationship
between Service Branding and Customer
Retention
p>0.05
(p=0.121)
Not supported
2. H2 – There is a positive relationship
between Perceived Value and Customer
Retention
p<0.05
(p=0.00)
Supported
3. H3 – There is a positive relationship
between Service Quality and Customer
Retention
p<0.05
(p=0.00)
Supported
7. ANALYSIS & FINDINGS
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• OneWay ANOVA Analysis (Significant difference in Variance)
Variable Race Generation Education Occupation Income Location
(State)
Service Branding S
(0.02)
S
(0.00)
S
(0.00)
S
(0.00)
S
(0.00)
X
(0.461)
Perceived Value S
(0.00)
S
(0.026)
S
(0.00)
S
(0.00)
S
(0.00)
X
(0.372)
Service Quality X
(0.359)
S
(0.029)
S
(0.026)
X
(0.152)
S
(0.00)
X
(0.338)
Customer
Retention
S
(0.017)
S
(0.001)
S
(0.00)
S
(0.00)
S
(0.006)
X
(0.264)
7. ANALYSIS & FINDINGS
7. 7 Demographic Profile Analysis
S – Significant X – Not significant 24
Variance within Demographic Variables (Sig. dif in mean)
Demography Items SB PV SQ CR
Malay (A) C D C
Race Chinese (B) C D
Indian (C)
Others (D)
B. Boomers 1946-64 (A) C C B C B
Generation Gen X 1965-80 (B) C
Gen Y 1981-2000 (C)
Primary/SRP/PMR (A) E F E F BDEF
Education SPM/MCE (B) D E F E F C
STPM/HSC/Certificate
(C) D E F E D E F DEF
Diploma (D) C E F
Degree (E)
Masters and above (F)
7. ANALYSIS & FINDINGS
7. 8 One-Way ANOVA Analysis
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7.9 Mean for Items within Demographic Variables
Demography Items SB
(Mean)
PV
(Mean)
SQ
(Mean)
CR
(Mean)
Malay 5.35 5.26 5.69 5.67
Race Chinese 4.92 5.33 5.75 5.58
Indian 5.71 5.71 6.00 6.18
Others 5.20 6.20 6.00 6.20
B. Boomers 1946-64 4.88 4.94 5.06 5.06
Generation Gen X 1965-80 5.26 5.32 5.79 5.81
Gen Y 1981-2000 5.60 5.45 5.76 5.72
Primary/SRP/PMR 5.71 5.79 5.79 6.57
Education SPM/MCE 5.64 5.33 6.04 5.57
STPM/HSC/Certificate 6.00 5.90 6.60 6.80
Diploma 5.21 5.32 5.82 5.70
Degree 5.02 5.08 5.32 5.56
Masters and above 5.06 5.59 4.94 5.71
7. ANALYSIS & FINDINGS
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8. DISCUSSIONS & CONCLUSSION
1. Perceived value is the most significant predictor of customer
retention in LPPKN. LPPKN customer retention strategy should
give due consideration on service charge imposed toward clients.
Ultimately, LPPKN’s objective towards increasing revenue by
retaining existing customer instead of solely revising service
charge.
2. Service quality contribute moderately towards customer retention
in LPPKN indicating that the perceived service quality are
indifference between LPPKN and other clinical service provider.
3. LPPKN service branding are insignificant towards customer
retention therefore shouldn’t be main focus on customer retention
strategy
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• Majority of clients are Malay (82%), mainly Generation X (60% ),
diploma holder & above (59%)
• All independent variables are positively related to DV
• Perceived Value and Service Quality have significant impact on
Customer Retention
• Service Branding is not significant to Customer Retention
• Demographic Variables have influence on SB, PV, SQ & CR
8. DISCUSSIONS & CONCLUSSION
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• Result can be used as basis for improvement
• Management of LPPKN or other health service provider can use this as input in policy making
Significance
• Time – 2 Weeks, Geographic factor
• Rural area might show different result
• 82% Malay doesn’t show Malaysian population
Limitations of the Study
• Concentrate on Service Branding because it is insignificant
• Compare LPPKN with KKM Clinics
Suggestions for Future Research
8. DISCUSSIONS & CONCLUSSION
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