BEHAVIOR
A CASE STUDY OF AIRASIA INDONESIA
By
KUO TING YU S11503042
BACHELOR’S DEGREE in
BUSINESS ADMINISTRATION - HOTEL AND TOURISM MANAGEMENT FACULTY OF BUSINESS AND COMMUNICATION
SWISS GERMAN UNIVERSITY The Prominence Tower
Jalan Jalur Sutera Barat No. 15, Alam Sutera Tangerang, Banten 15143 - Indonesia
JULY 2019
KUO TING YU STATEMENT BY THE AUTHER
I hereby declare that this submission is my own work, and to the best of my knowledge, it contains no material previously published or written by another person, nor material which to a substantial extent has been accepted for the award of any other degree or diploma at any educational institution, except where due acknowledgment is made in the thesis.
Kuo Ting Yu
_____________________________________________
Student Date
Approved by:
Robert La Are, S.ST, M.Par
_____________________________________________
Thesis Advisor Date
Dr. Nila K. Hidayat SE., MM.
____________________________________________
Dean Date
KUO TING YU ABSTRACT
THE IMPACT OF CUSTOMER LOYALTY PROGRAM TOWARDS PURCHASE BEHAVIOR. A CASE STUDY OF AIRASIA INDONESIA.
By
Kuo Ting Yu Robert La Are, S.ST, M.Par
SWISS GERMAN UNIVERSITY
The airline industry is considered as a promising sector in Indonesia. Due to the increase of economic and national income, the number of passengers is increasing year by year. AirAsia Indonesia is one of the well-known low-cost carriers in Indonesia who has won many prestigious awards. However, the number of low-cost carriers is also increasing, face a higher level of competition in the airline industry makes the management realized that they need a strategy to enhance their customers’
purchase behavior. This study reports the impact of customer loyalty on purchase behavior at AirAsia Indonesia. The questionnaire was completed by 132 respondents who have ever fly with AirAsia Indonesia. Single linear regression was used to test the impact of customer loyalty with two dimensions, which are attitudinal loyalty and behavioral loyalty. The results show that customer loyalty has a strong impact towards customers’ purchase behavior with the score of 83.8%. This study also provides the company with several suggestions to gain better customers’ purchase behavior.
Keywords: customer loyalty, low-cost carrier, airline industries, attitudinal loyalty, behavioral loyalty, purchase behavior
KUO TING YU
© Copyright 2019 by Kuo Ting Yu All rights reserved
KUO TING YU DEDICATION
I dedicate this hard works for God, my family, Mr.Are, and the sake of my bachelor’s degree. I sincerely wish this study can help improve future research regarding similar topics.
KUO TING YU ACKNOWLEDGMENT
First of all, I would like to express my sincerest thanks to God for giving me a healthy, physically and condition, strength, and always be there to guide me.
Second, I am sincerely thankful for my parents and family. Thank you for being supportive all the time. Thank you for supporting me both in moral and financial, without your encouragement, help, pray, and love I would be unable to finish this research.
Next, I would like to thank Mr. Are to be my thesis advisor. Thank you for your presence, advice, guidance, knowledge, motivation, and timely suggestions. Thank you for patiently teaching and guide me to finish this research. Also, to Ms. Jane from the English department, thank you for helping me in checking my grammars and citations, gave me a recommendation for the vocabularies, and all the feedback about this study.
To all hotel and tourism management faculty’s lectures, thank you for all the knowledge and help since semester one. Your knowledge and experience shared are helpful for my thesis. Also to my friends, thank you for always be there to support me, and here we are finally able to finish our research.
I would like to express my gratefulness to all the respondents who have helped me in this research.
Last but not least, thank you for all the people who have not been mentioned above, thank you for everything that you have done to me.
KUO TING YU TABLE OF CONTENTS
STATEMENT BY THE AUTHER ... 2
ABSTRACT ... 3
DEDICATION... 5
ACKNOWLEDGMENT ... 6
CHAPTER 1 – INTRODUCTION ... 12
1.1 Background ... 12
1.2 Research Problem ... 14
1.3 Research Questions ... 15
1.4 Research Objectives ... 15
1.5 Scope and Limitation ... 15
1.6 Significance of the Study ... 15
CHAPTER 2 LITERATURE REVIEW ... 16
2.1 Framework of Thinking ... 16
2.2 Airline Industry ... 17
2.3 Current Airline Industry in Indonesia ... 18
2.4 Loyalty Program ... 20
2.4.1 Loyalty Program by Air Asia ... 21
2.5 Purchase Behavior ... 22
2.6 Previous Studies ... 24
2.7 Study Differences ... 27
2.8 Hypothesis ... 28
CHAPTER 3 – RESEARCH METHOD... 29
3.1 Type of Study ... 29
3.2 Unit Analysis ... 30
3.3 Population and Sampling ... 30
3.3.1 Population ... 30
3.3.2 Sampling ... 30
3.3.3 Sampling Method ... 31
3.4 Type of Data Collection Method ... 32
3.4.1 Primary Data ... 32
3.4.2 Secondary Data ... 32
3.5 Research Model ... 33
3.6 Variable Operationalization ... 34
KUO TING YU
3.6.1 Independent Variable ... 34
3.6.2 Dependent Variable ... 36
3.7 Pre-test ... 37
3.7.1 Validity ... 37
3.7.2 Reliability ... 37
3.8 Data Analysis Technique ... 38
3.8.1 Single Regression ... 38
3.8.2 Normality Test ... 39
3.8.3 Heteroscedasticity Test ... 39
3.8.4 Hypothesis Test ... 40
3.8.4.1 F-Test... 40
CHAPTER 4 - RESULTS AND DISCUSSION ... 41
4.1 Company Profile – AirAsia Indonesia ... 41
4.2 Respondent Profile ... 43
4.2.1 Gender ... 43
4.2.2 Age ... 44
4.2.3 Educational Background ... 45
4.2.4 Occupation ... 46
4.2.5 Monthly Income ... 47
4.2.6 Purpose of Travel ... 48
4.2.7 Big Loyalty ... 49
4.3 Validity and Reliability ... 50
4.3.1 Validity Pre-Test Result ... 50
4.3.2 Reliability Pre-Test Result ... 50
4.3.3 Validity Post-Test Results ... 51
4.3.4 Reliability Post-Test Results ... 52
4.4 Classical Assumption Test ... 53
4.4.1 Normality Test ... 53
4.4.2 Heteroscedasticity Test ... 56
4.5 Single Linear Regression Test ... 56
4.5.1 Single Regression ... 56
4.6 Hypothesis Test ... 57
4.6.1 F-Test ... 57
4.6.2 T-Test ... 58
4.6.3 R-Square Test ... 59
KUO TING YU
4.7 Cross Tabulation ... 60
4.7.1 Attitudinal Loyalty ... 60
4.7.2 Behavioral Loyalty ... 61
4.8 Descriptive Study ... 62
4.9 Discussion ... 64
CHAPTER – 5 CONCLUSIONS AND RECOMMENDATIONS ... 66
5.1 CONCLUSION ... 66
5.1.1 Customer loyalty program impact the purchase behavior of AirAsia Indonesia ... 66
5.2 Recommendation ... 67
5.2.1 Recommendation for AirAsia Indonesia ... 67
5.2.2 Recommendation for Future Research or Students ... 69
GLOSSARY... 70
ABBREVIATION ... 71
REFERENCE ... 72
APPENDICES ... 77
CURRICULUM VITAE ... 81
