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The Antecedents and Effects of Relationship Quality, Satisfaction, Word-Of-

Mouth, and Loyalty of Hajj and Umra Travel Agencies in Indonesia

Conference Paper · November 2013

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The Antecedents and Effects of Relationship Quality, Satisfaction, Word-Of-Mouth, and

Loyalty of Hajj and Umra Travel Agencies in Indonesia

Adrian Achyar and Kiki Oktora*

Purpose: About 23% of world’s population is Muslims, and it is predicted to grow to 35% in

the next 20 years. Million of Muslims from all over the world take Hajj and Umra every year,

and Indonesia leads the largest Hajj pilgrims in the world. This makes huge demand for Hajj

and Umra travel agencies. To date there are 244 licensed Hajj and Umra travel agencies in

Indonesia. However, studies on Hajj and Umra travel agencies are scarce. The initial attempt

to study Hajj Umra travel agencies only focused on the impact of perceived value on

relationship quality. There is a need to build a more comprehensive model on Hajj and Umra

travel agencies.

The purpose of this study is to build a comprehensive model on Hajj and Umra travel

agencies and to test the model on empirical data. This study attempted to build models from

various studies on general travel agencies, with key variables of relationship quality,

satisfaction, word-of-mouth, and loyalty.

Design/methodology approach: This study uses quantitative design with cross sectional data

collection, and convenient sampling will be used to select respondents who already use the

service of Hajj and Umra travel agencies in Jabodetabek. Respondents filled structured

questionnaires. Data will be analyzed with structural equation modeling.

*
Department of Management, Faculty of Economics and Business, University of Indonesia.
Email: a.achyar@ui.ac.id
1
Findings: The findings are to be announced. The data collection is ongoing, and analyses are

on pilot-test stage, testing the reliability and validity of the measurements as well as the

wordings.

Research Limitations: The study limits to travel agencies only and does not employ Hajj and

Umra tour packages into the model. The study also has limited population.

Practical implications: Results of this study will be beneficial to travel agencies by offering

insights to factors that drive satisfaction, loyalty, and word-of-mouth in Hajj and Umra travel

agencies.

Originality/value: The study extends the understanding of consumers on religious tourism, in

particular Hajj and Umra travel agencies by building and empirically testing a comprehensive

model on Hajj and Umra travel agencies.

Keywords: religious tourism, Hajj and Umra, travel agencies, relationship quality, word-of-

mouth, loyalty

2
Introduction

About 23% of world’s population is Muslims (The Global Religious Landscape, 2012),

and it is predicted to grow to 35% in the next 20 years (The Future of the Global Muslim

Population, 2011). Million of Muslims from all over the world take Hajj and Umra every year

(Shah, 2012), and Indonesia leads the largest Hajj pilgrims in the world (Munawwaroh, 2012).

This makes huge demand for Hajj and Umra travel agencies. To date there are 244 licensed

Hajj and Umra travel agencies in Indonesia (Anggota Resmi Himpuh, 2013) . However,

studies on Hajj and Umra travel agencies are scarce. The initial attempt to study Hajj and

Umra travel agencies was conducted by Oktora and Achyar (in press), but it only focused on

the impact of perceived value on relationship quality. There is a need to build a more

comprehensive model on travel agency.

The purpose of this study is to build a comprehensive model on Hajj and Umra travel

agencies and to test the model on empirical data. This study attempted to build models from

various studies on travel agencies with key variables of relationship quality, satisfaction,

word-of-mouth, satisfaction, and loyalty.

Literature Review

Studies on travel agencies are abundant. Antecedents and impacts of satisfaction, trust are

well explored. Important concepts on travel agencies will be discussed and hypotheses

presented.

3
Relationship Quality

In relationship marketing, companies do not seek immediate sales but long-term supplier-

customer relationship (Kotler & Keller, 2012). If it is properly implemented, they will focus

on managing their customers. It is ongoing relationship between buyer and seller (Dwyer,

Schurr & Oh, 1987).

Satisfaction

Satisfaction with the institution is one of the satisfactions in service organization (Crosby

& Stephens, 1987). Satisfaction with the institution is defined as customers' overall evaluation

on their experience with the organization (Macintosh , 2007).

Word-of-Mouth

Word-of-mouth is informal communication between customers about particular service

(Westbrook, 1987). It has stronger effect than less vivid methods (such as printed media)

because the information is received in face-to-face manner (Herr, Kardes & Kim, 1991).

Loyalty

Loyalty is customer commitment to buy the same brand when they need the product in

the future (Bloemer & Kasper, 1995). Loyalty is important both in product and service firms

(Reichheld, 1993).

4
Customer Orientation

Customer orientation is the effort of providing customer satisfaction and establishing long

-term relationship with customers (Saxe & Weitz, 1982). It is the degree of salespeople trying

to help customers to make purchase decisions that satisfies their needs. Salespeople avoids

actions that sacrifice customer interests for short-term sales deals.

Expertise

Expertise is identification of salespeople's relevant competencies on service products

(Crosby, Evans & Cowles, 1990). It is a customer perception that salespeople have valuable

knowledge, training, experience, qualification, or skill in service products (Shamdasani &

Balakrishnan, 2000).

Trust

Trust is a belief that an exchange party will act in the best interest of the others

(Aborumman, Alhawary & Irtaimeh, 2011). It exists when a party is confident in the other's

reliability and integrity (Morgan & Hunt, 1994).

Commitment

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 Commitment is a belief held by an exchange partner that ongoing relationship is so

important that it warrants maximum efforts to maintain it (Morgan & Hunt, 1994). The

partner believes that the relationship is worth to maintain indefinitely.

Service Quality

Service quality is comparison between expectations and performance of a service

(Parasuraman, Zeithaml & Berry, 1985). it is degree and direction of gaps between

perceptions and expectations (Parasuraman, Zeithaml & Berry, 1988).

From original ten dimensions (Parasuraman et al, 1985), service quality were compressed

to five dimensions, which are tangibles, reliability, responsiveness, assurance, and empathy

(Parasuraman, et al, 1988). Tangibles are perceptions of facilities, equipments, and appearance

of employees. Reliability is the ability of service providers to conduct service dependably and

accurately. Responsiveness is willingness to help customers and to provide prompt service.

Assurance is ability of service employees to inspire trust and confidence, as well as their

knowledge and courtesy. Empathy is caring and individualized attention to customers.

Hypotheses

6
 Past studies on travel agencies discovered that agencies' customer orientation and

expertise affected relationship quality (Macintosh, 2007), which in turn affected trust (Tseng,

2007), commitment (Tseng, 2007), word-of-mouth (Macintosh, 2007), and satisfaction

(Macintosh, 2007). Therefore:

H1: customer orientation affects relationship quality

H2: expertise affects relationship quality

H3: relationship quality affects trust

H4: relationship quality affects commitment

H5: relationship quality affects word-of-mouth\

H6: relationship quality affects satisfaction

Service quality also affects satisfaction (Shahin & Janatyan, 2011; Campo & Yague,

2009), which affects word-of-mouth (Macintosh, 2007) and loyalty (Grissemann &

Stokburger-Sauer, 2012; Aborumman, Alhawary & Irtaimeh, 2011, Macintosh, 2007; Bigne et

al, 2002). Loyalty is also affected by relationship quality (Macintosh, 2007), trust

(Aborumman et al, 2011), and commitment (Aborumman et al, 2011).

H7: service quality affects satisfaction

H8: satisfaction affects word-of-mouth

7
 H9: satisfaction affects loyalty

H10: relationship quality affects loyalty

H11: trust affects loyalty

H12: commitment affects loyalty

Figure 1. Research Model

Methods

The measurements are developed from literature review (Table 1). They were translated

to Indonesian and adapted to Hajj and Umra travel agent. A pilot test was conducted to thirty

respondents who live in greater Jakarta, testing reliability, validity, and wordings. The validity

was conducted with principal component analysis and reliability with Cronbach’s alpha.

8
 Table 1: Sources of Measurements
Variables Dimensions Sources

Customer Orientation Macintosh (2007)

Expertise Moorman, Deshpande &

Zaltman, 1993; Macintosh
(2007)

Relationship Quality Macintosh (2007)

Service Quality Tangibles Ruiqi & Adrian (2009)

reliability Ruiqi & Adrian (2009)

responsiveness Ruiqi & Adrian (2009)

assurance Ruiqi & Adrian (2009);

Bigne et al (2003)

empathy Ruiqi & Adrian (2009);

Bigne et al (2003)

Trust Morgan & Hunt 1994;

Crosby, Evan, Cowles
1990

Commitment Crosby, Evan, Cowles

1990

Satisfaction Grissemann & Stokburger-

Sauer, 2012; Aborumman,
Alhawary & Irtaimeh
2011; Macintosh 2007

Loyalty Macintosh (2007)

Word-of-Mouth Macintosh (2007)

Result and Discussion

Pilot Test Statistics

9
 Pilot test results on reliability of the measurements are presented in Table 2. Overall, the

measurements are reliable. The Cronbach’s alpha for most variables are above 0.6 (Malhotra

et al, 2002). However, Cronbach's alpha of some variables are below 0.6, such as expertise,

relationship quality, service quality's dimension's of assurance, and word-of-mouth.

Table 2: Pilot Test's Reliability of Measurements

Variables Dimensions Cronbach's Alpha

Customer Orientation 0.690

Expertise 0.180
Relationship Quality 0.344
Service Quality Tangibles 0.755
reliability 0.667
responsiveness 0.815
assurance 0.287
empathy 0.535
Trust 0.649
Commitment 0.770
Satisfaction 0.801
Loyalty 0.756

Word-of-Mouth 0.325

Reliability analysis of expertise relationship quality, service quality's dimension's of

assurance, and word-of-mouth are recalculated. Of the five items of expertise and assurance,

two are dropped so the final reliability is 0.574 and 0.565. We hypothesized that the value are

almost 0.6 because the limitation of sample size. Therefore, the remaining items are retained

for the main test. The Bartlett’s and Keiser-Meyer-Olkin's Measure of Sample Adequacy

(KMO) of the two variables after dropping of items are adequate; the Bartlett’s are significant

10
below 5% and the MSA are above 50% (Malhotra et al, 2002). The Bartlett’s test for

expertise and assurance are 0.004 and 0.005, and the KMO are 0.594 and 0.626.

For the word-of-mouth, there are only two items. The Cronbach's alpha of lower than 0.6

and insignificant Bartlett’s test (0.213) implies that unidimensionality of the variable is low.

Macintosh (2007) measures word-of-mouth by two items, frequency and valence. Therefore,

for the main test, frequency and valence will be separated in the model.

Especially for assurance and relationship quality, dropping of items does not produce

desirable value of Cronbach's alpha, Bartlett’s test and KMO. These two variables are

recommended to be respecified in the terms of wordings in the main test.

Conclusion

The data collection and analysis for the pilot test is finished. Some items in some

variables are retained and some are dropped. One variable is recommended to be separated in

the main test, and two variables are to be respecified. Data collection for the main test is still

ongoing, and the data will be analyzed with structural equation modeling. Results from the

analysis will be beneficial to travel agencies by offering insights to factors that drive

satisfaction, loyalty, and word-of-mouth in Hajj and Umra travel agencies.

11
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