BOARDS OF C01MITTEE

27

Transcript of BOARDS OF C01MITTEE

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BOARDS OF C01MITTEE

Director Dr H K Prihartono AH Drs SSos MM

Chief in Charge Dr Rita Zulbett SSi MM

Managing Committee Yudhy Purwanto SS MHum MM

Reviewers Dr Sudirman SEAk MSi Lukfnanulhakim Almamalik ST MT Yuda Syalffdin ST MKo~ Drg Farida Gustini MM Akasah SSo~ NLM Resanti Lestari S-PdIv1Pd_

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Madiun BA NKING (EMPIRICAL STUDY OF ISLAMIC BANKING IN MADIUN)

Santi Hariyani

THE IMPACT OF DEVIDENDPiksi Canesha

ANNOUNCEMENTQN SH ARE VALUE Ira Mur-w-enie Polytechnic

Bandung (AUSTRALIAN STOCK EXCHAN GE MARKET DIRECTORY)

Heru Su1istyo Sultan Agung THE ROLE OF SOSAL CAPITAL AND Mutamimah Islamic UniverSity CONSUMER LOYALTY IN ISLAMICS S

jTriwikaningrum Sem arang OANKING

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PERFORMANCE OF MINIMARKET

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Suhan Agung Ardian Adhiatma

Islamic UniverSity 9 MA lrfan Rahmana

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Agus Satory Akatelkom Bogor 10

Polytechnic of Ousa Sumarraya Praktisi

11 Polytechnic of Post

Of Indonesia Jaka Maulana

Piks i Ganesha 12 Polytechni c

fl andung K Priha rtono AH

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THE ANALYSI SOF SALE S nUDCEr REALIZATiON AS A TOOL FOR SALES PLANNING AND CONTROLING IN PT

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STUDY OF CONSUMER PROTECTION LAW IN THE FINANCIAL SERVICE 10

SECTOR REVI EW IN COME TAX ARTICLE 26

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Cicilia Larasati Ciputra University Rembulan Surabaya

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STOCK EX CHANGE (CASE STUOY OF MANUFACTURING BUSINESS FOR TH E

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ANALYSIS OF TH E ROLE OF THIRD 15

PARTY FUNDS TOTAL CREDIT BANK

THE ANALYSIS OF FINANCIAL CHARACTERISTIC AND INDEX OF

16PU8LIC IN FORMATION DISCLOSURE TO

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INDONESIA STOCK EXCHANGE PERIOD 1 200S-2012)

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STATEMENTS DEBT RATIO INVESTMENT OPPORTUNITY SET 18

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CAPABILITIES RELATIONAL CAPTAL AND EMPOWERMENT -- shy ---

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APPLICATIONS IN THE PRIVATE

27 Nur Hayati STIE STAN Indon esia HIGHER EDUCATION TOACHIEV[

27 Mandiri Bandung CO MPETITIVENESS (A CASE STUDY

AT SfIE STA N INDONES IA MANDIRI BANDUNG)

BUILDING KNOWLEDGE SHAR ING

28 Rina Anindita Esa Unggul TRHOUGH WATKIN S AND MARSI CK I

MODEL OF LEARNING 28 ITaufiqurrahman I Universiry ORGANIZATION ADOPTED IN

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29 1 Tin Hayati Dewj I PUBLIC RELATIONS AS THE I IAkclelkom FU NCTION OF MANAGEMENT TO

29 Sartika i REAC H THE GOlL OF THE

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DEVELOPMENT A BENEFITS 30

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PolytechnIC Bandung

1 FACILITY DEPARTMENT (CASE

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3B Khoirul Umam Indraprasta PGRI

UniverSity of Jakarta SP IRITUAL MARKETING IN ISLAMIC

PERSPE CT IVE 38

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CONSULTANT IN TECAL CITY

39

DEVELOPMENT STRATEGY OF LAPIS

40 Oesi Harsa nti ResiSC3 Vikaliana

Akatelkom Boger BOGlt)R SANGKURIANG AS A MARKET

LEADER IN CULINARY PRODUCT 40

BASED ON TALAS

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LOCAL STATE middotOWNED COMPAN IES

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86 Afe ndi S5i MSi

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PERFORMANCE OBSERVED FROM

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89 Abdul Rahim

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I CO MPANY IN THE INDUSTRIAL

IAREA OF OCEAN FISHERIES PORT KENOARI

Eny Retna Akademi Kebidanan

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90 Ambarwa ti Elsa Y YogyakJrta

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91Andrian Liem Su rabaya MEDICINE (CAM) MUSIC THERAPY

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92 PANT RAPIH HO SPITAL 92Nugroho M2rkus University

YOGYAKARTA BASED SM

ELEMENTS OF MANAGEMENT

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97 Mayang Yogyakarta

PANTI RAPIH HOSPITAL

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NURSERY ABILITY AND WORK 98

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Piksi Ganesha AND CHAMCTERISTICS or

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

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exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

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Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 2: BOARDS OF C01MITTEE

ECONOMICS AND BUSINESS

NO NAME INSTITUTION[S) rrilT- ----- PACf ~I L

Twinfech THE IMPELEMNTATJON IMPACT OF-- - shyInternational ~ THE WORLD BANK ANUI Azahari amaudin

Univers ity College INTERNATIONAL MONETARY FUN D

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Piksi Ganesha WllL AFFECTTO PRICE EARNINGHani2 Po lytech nic RATIO (EMPIRICAL STU OI EST LISTED 2Hatimatunnisani

Bandung IN INDONESIA STOCK EXCHANGE 2008middot2012 PERIOD)

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Madiun BA NKING (EMPIRICAL STUDY OF ISLAMIC BANKING IN MADIUN)

Santi Hariyani

THE IMPACT OF DEVIDENDPiksi Canesha

ANNOUNCEMENTQN SH ARE VALUE Ira Mur-w-enie Polytechnic

Bandung (AUSTRALIAN STOCK EXCHAN GE MARKET DIRECTORY)

Heru Su1istyo Sultan Agung THE ROLE OF SOSAL CAPITAL AND Mutamimah Islamic UniverSity CONSUMER LOYALTY IN ISLAMICS S

jTriwikaningrum Sem arang OANKING

Pi ksi Ganesha BUILDING THE ROLE MODEl OF I Resanti Lestari PolytechniC CUSTOM ER LOYALTY SERVICES AT 6

1--1___ _ _ ___~--cB~~n~ g-__-1--o ~~ A~ N IN DO N~E~I A +---6

d u~n~ S~H~ARIA~B~ N~K~S~~~~ S~ ---THE INFLUENCES OF UNIQUE

CAPABILITIES AN D PARTNERSHIP I IHans Ha rfschandra Padjadjaran I STRATEGY 0 N nUSINESS 77 TanurOlharjo University

PERFORMANCE OF MINIMARKET

~-+____________ -+______________~~~~~~ R~K~N N~D~O N E~S~A~~-+_____N ETW~D~ ~ ~~Piksi Ganes ha

8 Shifa Wulandari Polytechni c Bandung

Suhan Agung Ardian Adhiatma

Islamic UniverSity 9 MA lrfan Rahmana

Semarang

Agus Satory Akatelkom Bogor 10

Polytechnic of Ousa Sumarraya Praktisi

11 Polytechnic of Post

Of Indonesia Jaka Maulana

Piks i Ganesha 12 Polytechni c

fl andung K Priha rtono AH

Igt

THE ANALYSI SOF SALE S nUDCEr REALIZATiON AS A TOOL FOR SALES PLANNING AND CONTROLING IN PT

I B

PIN DAD (ERSERO) BANDUNC THE ROLE OF DYNAMIC MODEL OF

CUSTOMER ENGAGEMENT TOWARDS 9 CU STOMER VALUE

STUDY OF CONSUMER PROTECTION LAW IN THE FINANCIAL SERVICE 10

SECTOR REVI EW IN COME TAX ARTICLE 26

ABOUT ROYALTIES SOFTWARE BY PT ) J DNA ON P3B BETWEEN INDONESIA 1

AND SIN GAPORE THE INFLUEN CE OF MARKETI NG MiX _ _ - i

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13

14

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I I I l

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20

21

22

23

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Fai Zamzami UGM Vucational School

Irene Sukma Lestari Piksi Ganesha Barus Perwi(o Polylerhnic Bandung

-Henny Utarsih Iwan

LP 3 1 Polytechnic C Irawan Agatha Rinta Suhardi

BanLlung

Yeni Priatnd Sari Sunandar Ida

Harapan Bersama

Farida Polyt echnic Tegal

I Dito Rinaldo Vina

5TIpound Ekult3s Piks i

Anggilia Puspita Gan esha Polytechnic

Bandung

Erma Ku rniasih Sri ISultan Agung Islamic

Dewi Wahyundam IUniversity Semarang

Cicilia Larasati Ciputra University Rembulan Surabaya

Chancellor University Atin Hafidiah Yana

Polytechnic Of Maulana

Practitioners

Siyamtinah Heru Sultan Agung Islamic Suli styo Unive rsity Scmarang

-- shy --shy - shyG h S d ST[E Sutaatmadja

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11

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PROFESSJONAL STANDARDS OF INTERNAL AUDIT AT XVZ STATE UNIVERSITY (AN ANA LYSIS OF 13

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SOLVABILITY AND PROFITABILlTYTO

RETURN OF SHARES IN MANUFACTURING BUSINES S

RECISfEREO ON THE INDONESIA 14

STOCK EX CHANGE (CASE STUOY OF MANUFACTURING BUSINESS FOR TH E

PERIOD 2010 TO 20 12

ANALYSIS OF TH E ROLE OF THIRD 15

PARTY FUNDS TOTAL CREDIT BANK

THE ANALYSIS OF FINANCIAL CHARACTERISTIC AND INDEX OF

16PU8LIC IN FORMATION DISCLOSURE TO

VOLUNTARY DISCLOSURE DEBT AS A TOOL OF EXPROPRIATION

rEMPIeAL STUDY ON PROPERTY AND REAL ESTATE COMPANIES LISTED IN 17

INDONESIA STOCK EXCHANGE PERIOD 1 200S-2012)

THE FFFECT VOLUNTARY DISCLOSURE OF FINANCIAL

STATEMENTS DEBT RATIO INVESTMENT OPPORTUNITY SET 18

I INSTITUTIONAL OWNERS HIP AND

IMANAGERIAL OWNERSHIP ON EARNIN GS MANAGEMENT

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THEIR NEED CASE STUDY IN CAFE -X~ REVIEW OF VAT (VALUE ADDED TAX)

APPLICATION ON SERVICES 20

MARKETING FROM OUTSIDE THE CUSTOMS [N PT UM

IMPROVED PERFORMANCE AND INNOVATION CA PA BI LITY ATTROSO lEPARA SME ENTREPRENEURSHIP

BASED ON MARKETING 21

CAPABILITIES RELATIONAL CAPTAL AND EMPOWERMENT -- shy ---

AIRPORTS DISTRI BUTiON CENTERS 22 -__

THE NURTURING CHARACTERI STIC IN FE MALE LEA DERSHIP

23

~ j

I

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1

1 I

MURABAHA IN VALUE ADDED -~ -

Judi Suharsono P3nca Marga SHARIA AN EFFORT TO INCREASE

2 Sulis Dyah Candra 2 Ngatimun

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ECONOMIC SCALE AND SPIRITUALITY -Suharyanto THE EFFECT OF JOB PROMOTION

2S Hendra Permana Uni ve rsity Of TOWARD WORK ENTHUSIASM OF

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THE COR RElATIO N TEST OF JOB MOTIVATION AND THE EMPLOYEES

lin Kurniawati LP31 PolytechniC JOB DlClPLINE IN SUPPORTING THE

26 DEVELOPMENT OF HUMAN 26Yuyun Taufik Bandung

RESOURCES IN INDONESIA (CASE STUDY IN 17 COMPANIES IN

BANDUNG) LEARNING ORGANIZATIONS

APPLICATIONS IN THE PRIVATE

27 Nur Hayati STIE STAN Indon esia HIGHER EDUCATION TOACHIEV[

27 Mandiri Bandung CO MPETITIVENESS (A CASE STUDY

AT SfIE STA N INDONES IA MANDIRI BANDUNG)

BUILDING KNOWLEDGE SHAR ING

28 Rina Anindita Esa Unggul TRHOUGH WATKIN S AND MARSI CK I

MODEL OF LEARNING 28 ITaufiqurrahman I Universiry ORGANIZATION ADOPTED IN

~I FAS HION CREATIVE INDUSTRY

29 1 Tin Hayati Dewj I PUBLIC RELATIONS AS THE I IAkclelkom FU NCTION OF MANAGEMENT TO

29 Sartika i REAC H THE GOlL OF THE

ORGA NIZATION

College of EX-MINING LAND USE IN THE LIVE

1 Joni Ariansyah I Agricultural

I STOCK SECTOR FOR SUSfAINABLE 30 Ahyar Ismail Luky Academy or East

DEVELOPMENT A BENEFITS 30

Abdullah J Kutai Bogor ANALYSlS

Agricultural Univ

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INDONESIAN TRADITIONAL THREAT

31 Johnson Kennedy University Jakarta

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Lampung LAMPUNG)

iii

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Yenny Marlini

34

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Piksi Ganesha J DITANGGUNG PE~-1ERINTAII 36

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PolytechnIC Bandung

1 FACILITY DEPARTMENT (CASE

37

STU DY AT BATUNUNG GAL IN OAH 1 WIR)

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UniverSity of Jakarta SP IRITUAL MARKETING IN ISLAMIC

PERSPE CT IVE 38

39

Sunandar Ida

Farida Yeni

Pri3tna Sari

Harapan Bersama

P~l ytechn i c Tegal

FACTORS AFFECTING THE USE OF TAX PAYER SERV ICE TAX

CONSULTANT IN TECAL CITY

39

DEVELOPMENT STRATEGY OF LAPIS

40 Oesi Harsa nti ResiSC3 Vikaliana

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LEADER IN CULINARY PRODUCT 40

BASED ON TALAS

41 Lll kma nulhakim

AlmamaJik

AN NEW METH OD FOn FIN D AN Plksl Ganesha OPTIMAL SOLUTION FOR

Polytechni c Bandung TRANSPORTATION PROBLEM

1--+----shy - -+-------shy 1-- eLI MmiddotATF ORGANIZATioN

41

MEASUREMENT BASED ON

42 Teni Listitln i STIA LAN BandUng ~ OENISONS THEORY (~iUD I ES AT 42

LOCAL STATE middotOWNED COMPAN IES

---_ _ ____ --__ ______ _ QF WEST JAVA PROV~NCE) _-----_~

IV

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nn 2014

INFORMATION AND TECHNOLOGY

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Mukhamad tI DEVELOPM lNT TRANSACTIONAL

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Yu RI STM II( YAOIKA BANGIL

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Suprapto Mawridhi ~nsitut Te kllotogi _ USING BLOGS ANA_LYSIS _ II f--- Hery Purnomo Sepuluh NoveOlber _

I I Piksi Ga nesha 1I ARTIFICIAl INTELLIGENCE ANO TS-+I-- -R-i

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T HE APPLICATlON OF COBIT 5 FRAMEWORK ANALYSIS IN

51 INFORMATION TECHNOLOGY

GOVERNANCE=-_ --__-i_

DESIGN OF MODEL MAKING 3 UIMENSIONAL FACIAL EXPRESS ION l 5l

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53 L-----______ l ______ _ L __ bull ___________ _ bull _ _ ___ _

v

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PLANNING MANAGEMENT auslNEsS Plks i Ganesha

54 Yud hi Yanuar ENTERPRISE USIN G THE UNiFIED 54Polytedlnk Ba ndung

PROCESS (EUP)(CASE STUDY SANG

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55 55Rita Komltllasui Bandung TEACHERS PERFORMANCE IN $MP

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56 Abdul Azi Sha h 56Hassan Nur Afiqah BLI NO PEOLE

Polytech nicBintl Mohaini

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57 SENSOR FOR HOME SECURITY USING 57Isoi Anisah Polytechnic Bandung

LASER Rida Hudaya APPLICATION OF ROW INDEX DATA

~-

Band ung Slare 58 C elln Wida ACCESS MATRIX ALGOR ITHM 58

Polytech nic Nurhaeti IN HMljSCADA SYSTEMS

INFLUENCE OFTHE USE OF

NFORMATION SYSTEMS IND Piksi Ganesha

59 Sep ti Noer Lailela p 1 h B d ORGANIZATIONAL CULTURE AGAINST 1 59 [ 0 ytEe I e an ung EMPLOYEE PERFORMANCE I i ~ PT LEN INDUSTRI (PERSERO) THE IMPLEMENTATION OF A METHOD

Aehmad Falz Bazar 1 STM IK Yadi ka Sa il j DESIGN SYSTEM OF FIN ITE STATE 60 60 Moh Aries Syufagi ng MACHI NE (FSM) AND FLOWCHART FOR

- =_c---_-_ _ _ _ _ _ -___-ceAMF DAKON ---c

IDewi Handayanir- I I IMPLEMENTATION CULTURAL II 61 I~ nt rj Nngsih D Stikubank University EHERITAGE SE MARANG USINC W EB GI S 61

ae uno unan w IN THE CLOUD

Bu di Santoso 1 DEVELOPING ONLINE EXAMS USING

Bina Sarana62 I Ricky Firmansyah r GOOGLE DRIVE AS IM PLEM ENTATION r 6Z

lnformatika OF CLOUD COMPUTING TECHNOLOGY

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Piksi Ganesha 66Edi Suharto CASE STU DY 66

Polytechmc Bandung INVENTORY SYSTEM OF GOVERNMENT

PROPERTY OF WEST lAVA

VI

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67 Anton Sukamto Akattlkom Bogor rrHROUGH Emiddot(OMMpoundRCE IN IMPROVING 67

---+-_ shy _- BUSINESS SERVI CES - TH E DESIGNING OF A WEB BASED

TEACHER TRAINING AND

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INFORMATION SYST EM USING A 68

RATIONAL UN IFIED PROCESS (RUP) METHOD AT PP PPT K BMTI BArmUNG-

CAPTI VE PORTAL APPLICAT ION IN WIRELESS COMPUTER NETWORK

Piksi Ganesha FOP HOTSPOT SERVICE69 Hendra latnika 69

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r-+- -cc-------+I--=-------+I- TH E EFF ECT U COUNS W NG I POSTPARTUM TO USE

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I Kism oyo j Yogya kana I MUJAHIDAHS MATERNITY HOME

SRIMARTANI PIYUNGAN BANTUL

In Yu GYAKA RTA

DIFfERENCES IN ATTITUDES BETWEEN PSYC HOLOGI STS AN D

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MEDICINE (CAM) IN SURABAYA II i RELATED IN FO RM ATION SOURCES

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VII

viii

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GENE THERAPY THE EFFECT OF

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86 Afe ndi S5i MSi

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BANTUL YOGYAKARTA

I

PERFORMANCE OBSERVED FROM

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I CO MPANY IN THE INDUSTRIAL

IAREA OF OCEAN FISHERIES PORT KENOARI

Eny Retna Akademi Kebidanan

KNOWLEDGE AND SUPPORT THE

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ELEMENTS OF MANAGEMENT

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LIFE (QOL) Of PATIENTSmiddot USING 93Trisula Andrian Surabaya

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CULI URE 10WA DS 8ACA Bl-_RMshy

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

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Page 3: BOARDS OF C01MITTEE

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Fai Zamzami UGM Vucational School

Irene Sukma Lestari Piksi Ganesha Barus Perwi(o Polylerhnic Bandung

-Henny Utarsih Iwan

LP 3 1 Polytechnic C Irawan Agatha Rinta Suhardi

BanLlung

Yeni Priatnd Sari Sunandar Ida

Harapan Bersama

Farida Polyt echnic Tegal

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5TIpound Ekult3s Piks i

Anggilia Puspita Gan esha Polytechnic

Bandung

Erma Ku rniasih Sri ISultan Agung Islamic

Dewi Wahyundam IUniversity Semarang

Cicilia Larasati Ciputra University Rembulan Surabaya

Chancellor University Atin Hafidiah Yana

Polytechnic Of Maulana

Practitioners

Siyamtinah Heru Sultan Agung Islamic Suli styo Unive rsity Scmarang

-- shy --shy - shyG h S d ST[E Sutaatmadja

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PROFESSJONAL STANDARDS OF INTERNAL AUDIT AT XVZ STATE UNIVERSITY (AN ANA LYSIS OF 13

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SOLVABILITY AND PROFITABILlTYTO

RETURN OF SHARES IN MANUFACTURING BUSINES S

RECISfEREO ON THE INDONESIA 14

STOCK EX CHANGE (CASE STUOY OF MANUFACTURING BUSINESS FOR TH E

PERIOD 2010 TO 20 12

ANALYSIS OF TH E ROLE OF THIRD 15

PARTY FUNDS TOTAL CREDIT BANK

THE ANALYSIS OF FINANCIAL CHARACTERISTIC AND INDEX OF

16PU8LIC IN FORMATION DISCLOSURE TO

VOLUNTARY DISCLOSURE DEBT AS A TOOL OF EXPROPRIATION

rEMPIeAL STUDY ON PROPERTY AND REAL ESTATE COMPANIES LISTED IN 17

INDONESIA STOCK EXCHANGE PERIOD 1 200S-2012)

THE FFFECT VOLUNTARY DISCLOSURE OF FINANCIAL

STATEMENTS DEBT RATIO INVESTMENT OPPORTUNITY SET 18

I INSTITUTIONAL OWNERS HIP AND

IMANAGERIAL OWNERSHIP ON EARNIN GS MANAGEMENT

OBSERVING THE CON)UtvtER TO MEET 19

THEIR NEED CASE STUDY IN CAFE -X~ REVIEW OF VAT (VALUE ADDED TAX)

APPLICATION ON SERVICES 20

MARKETING FROM OUTSIDE THE CUSTOMS [N PT UM

IMPROVED PERFORMANCE AND INNOVATION CA PA BI LITY ATTROSO lEPARA SME ENTREPRENEURSHIP

BASED ON MARKETING 21

CAPABILITIES RELATIONAL CAPTAL AND EMPOWERMENT -- shy ---

AIRPORTS DISTRI BUTiON CENTERS 22 -__

THE NURTURING CHARACTERI STIC IN FE MALE LEA DERSHIP

23

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1 I

MURABAHA IN VALUE ADDED -~ -

Judi Suharsono P3nca Marga SHARIA AN EFFORT TO INCREASE

2 Sulis Dyah Candra 2 Ngatimun

UnivCfsiry PROBOLINGGO SHALLOT FARMERmiddotS

ECONOMIC SCALE AND SPIRITUALITY -Suharyanto THE EFFECT OF JOB PROMOTION

2S Hendra Permana Uni ve rsity Of TOWARD WORK ENTHUSIASM OF

2S Hercyawan Suryakenca na THE EMPLOYEE OF GIRl KEf-1BANG Nugraha HOTEL AND VILLA CIA~JUR

THE COR RElATIO N TEST OF JOB MOTIVATION AND THE EMPLOYEES

lin Kurniawati LP31 PolytechniC JOB DlClPLINE IN SUPPORTING THE

26 DEVELOPMENT OF HUMAN 26Yuyun Taufik Bandung

RESOURCES IN INDONESIA (CASE STUDY IN 17 COMPANIES IN

BANDUNG) LEARNING ORGANIZATIONS

APPLICATIONS IN THE PRIVATE

27 Nur Hayati STIE STAN Indon esia HIGHER EDUCATION TOACHIEV[

27 Mandiri Bandung CO MPETITIVENESS (A CASE STUDY

AT SfIE STA N INDONES IA MANDIRI BANDUNG)

BUILDING KNOWLEDGE SHAR ING

28 Rina Anindita Esa Unggul TRHOUGH WATKIN S AND MARSI CK I

MODEL OF LEARNING 28 ITaufiqurrahman I Universiry ORGANIZATION ADOPTED IN

~I FAS HION CREATIVE INDUSTRY

29 1 Tin Hayati Dewj I PUBLIC RELATIONS AS THE I IAkclelkom FU NCTION OF MANAGEMENT TO

29 Sartika i REAC H THE GOlL OF THE

ORGA NIZATION

College of EX-MINING LAND USE IN THE LIVE

1 Joni Ariansyah I Agricultural

I STOCK SECTOR FOR SUSfAINABLE 30 Ahyar Ismail Luky Academy or East

DEVELOPMENT A BENEFITS 30

Abdullah J Kutai Bogor ANALYSlS

Agricultural Univ

Posma Sariguna Kristen Indon esia

INDONESIAN TRADITIONAL THREAT

31 Johnson Kennedy University Jakarta

LE VEL OF ITS STRATEGIC 31 Hutasoit ENVIRONMENT

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Business Inlitute DETERMINANTS IN MAKING

32 Anoar Sanusi Oarmajaya Bandar

COMPETITIVENESS (STUDY OF 32 TOURISM SECTOR IN BAN DAR

Lampung LAMPUNG)

iii

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33 Sri W3hyuningsih Satya Praliwi

Yenny Marlini

34

Galuh Tresna Murti Rakhmini

Juwita Sakti Muda NasUlion

3S Gregorius N

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TBK BRAN CH KEBUMEN)

POUTEKNIK LP31 BAN DU NGLP31 Polytechn ic

ACCOUNTING MAJOR STUDE NTS Bandung Universitas 34

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Piksi Ganesha J DITANGGUNG PE~-1ERINTAII 36

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UniverSity of Jakarta SP IRITUAL MARKETING IN ISLAMIC

PERSPE CT IVE 38

39

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FACTORS AFFECTING THE USE OF TAX PAYER SERV ICE TAX

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39

DEVELOPMENT STRATEGY OF LAPIS

40 Oesi Harsa nti ResiSC3 Vikaliana

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BASED ON TALAS

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DIFfERENCES IN ATTITUDES BETWEEN PSYC HOLOGI STS AN D

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VII

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BANTUL YOGYAKARTA

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PERFORMANCE OBSERVED FROM

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I CO MPANY IN THE INDUSTRIAL

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Eny Retna Akademi Kebidanan

KNOWLEDGE AND SUPPORT THE

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PANTI RAPIH HOSPITAL

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 4: BOARDS OF C01MITTEE

MURABAHA IN VALUE ADDED -~ -

Judi Suharsono P3nca Marga SHARIA AN EFFORT TO INCREASE

2 Sulis Dyah Candra 2 Ngatimun

UnivCfsiry PROBOLINGGO SHALLOT FARMERmiddotS

ECONOMIC SCALE AND SPIRITUALITY -Suharyanto THE EFFECT OF JOB PROMOTION

2S Hendra Permana Uni ve rsity Of TOWARD WORK ENTHUSIASM OF

2S Hercyawan Suryakenca na THE EMPLOYEE OF GIRl KEf-1BANG Nugraha HOTEL AND VILLA CIA~JUR

THE COR RElATIO N TEST OF JOB MOTIVATION AND THE EMPLOYEES

lin Kurniawati LP31 PolytechniC JOB DlClPLINE IN SUPPORTING THE

26 DEVELOPMENT OF HUMAN 26Yuyun Taufik Bandung

RESOURCES IN INDONESIA (CASE STUDY IN 17 COMPANIES IN

BANDUNG) LEARNING ORGANIZATIONS

APPLICATIONS IN THE PRIVATE

27 Nur Hayati STIE STAN Indon esia HIGHER EDUCATION TOACHIEV[

27 Mandiri Bandung CO MPETITIVENESS (A CASE STUDY

AT SfIE STA N INDONES IA MANDIRI BANDUNG)

BUILDING KNOWLEDGE SHAR ING

28 Rina Anindita Esa Unggul TRHOUGH WATKIN S AND MARSI CK I

MODEL OF LEARNING 28 ITaufiqurrahman I Universiry ORGANIZATION ADOPTED IN

~I FAS HION CREATIVE INDUSTRY

29 1 Tin Hayati Dewj I PUBLIC RELATIONS AS THE I IAkclelkom FU NCTION OF MANAGEMENT TO

29 Sartika i REAC H THE GOlL OF THE

ORGA NIZATION

College of EX-MINING LAND USE IN THE LIVE

1 Joni Ariansyah I Agricultural

I STOCK SECTOR FOR SUSfAINABLE 30 Ahyar Ismail Luky Academy or East

DEVELOPMENT A BENEFITS 30

Abdullah J Kutai Bogor ANALYSlS

Agricultural Univ

Posma Sariguna Kristen Indon esia

INDONESIAN TRADITIONAL THREAT

31 Johnson Kennedy University Jakarta

LE VEL OF ITS STRATEGIC 31 Hutasoit ENVIRONMENT

Inrormatics and STRATEGIC ANALYSIS MODEL OF

Business Inlitute DETERMINANTS IN MAKING

32 Anoar Sanusi Oarmajaya Bandar

COMPETITIVENESS (STUDY OF 32 TOURISM SECTOR IN BAN DAR

Lampung LAMPUNG)

iii

~ -

33 Sri W3hyuningsih Satya Praliwi

Yenny Marlini

34

Galuh Tresna Murti Rakhmini

Juwita Sakti Muda NasUlion

3S Gregorius N

Masdjojo

Muhammad

I 3fl Taqyudin

00==-- ------shyANALYSIS OF EFFECT OF SOCIAL

1~RESPONSIBILITY BUSINESS poundTH IeS ~CORPORATE GOVERNANCE AND

Dharma Ptl tr ia RE PUTATI ON IN ON THE o ( 33Polytechnic PERFORMANCE IMPROVEMENT ~I

COMPANY (STUDIES IN CORPORATE CUSTO MER PT TELKOM INO ONESIA

TBK BRAN CH KEBUMEN)

POUTEKNIK LP31 BAN DU NGLP31 Polytechn ic

ACCOUNTING MAJOR STUDE NTS Bandung Universitas 34

PEICEPTION TOWARDS Tit ETerbuka _+__ACC-O-U_NTA_N_T_PRO FESSI 0-_+_-1

THE KEYNESIAN AND THE MONETARY APPROACH TOWARDS

THE DYNAMICS OF FOREI(N

Stikubank UniverSity EXCHANGE RESERVE THKOUGH T HE 3S

Semaran g BALANCE Or PAYMENT INVESTiGATION AN EMPI]ICAL

STUDY IN INDONESIA ON THE

PERIOD 1983-20013 ----fl---AN--LYSIS~OF BEA MASUK--CA

Piksi Ganesha J DITANGGUNG PE~-1ERINTAII 36

I--f-- m i~-hk m I PoIYl edc lJan_ ( ~ _ ~M_p_ _____T~~~-~~ -=~ _____ ~u~ f-IccBcM-OT~J_ ~~~~~~~~sU S_THE INFLUENCE OF OPERATIONAL

COST AN D SERVICE EARNINGS

Karyadf Piks i Ganesha TOWAR D NETT RFVFt~UE AT SPORTI I Sugiyante Entang

PolytechnIC Bandung

1 FACILITY DEPARTMENT (CASE

37

STU DY AT BATUNUNG GAL IN OAH 1 WIR)

3B Khoirul Umam Indraprasta PGRI

UniverSity of Jakarta SP IRITUAL MARKETING IN ISLAMIC

PERSPE CT IVE 38

39

Sunandar Ida

Farida Yeni

Pri3tna Sari

Harapan Bersama

P~l ytechn i c Tegal

FACTORS AFFECTING THE USE OF TAX PAYER SERV ICE TAX

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39

DEVELOPMENT STRATEGY OF LAPIS

40 Oesi Harsa nti ResiSC3 Vikaliana

Akatelkom Boger BOGlt)R SANGKURIANG AS A MARKET

LEADER IN CULINARY PRODUCT 40

BASED ON TALAS

41 Lll kma nulhakim

AlmamaJik

AN NEW METH OD FOn FIN D AN Plksl Ganesha OPTIMAL SOLUTION FOR

Polytechni c Bandung TRANSPORTATION PROBLEM

1--+----shy - -+-------shy 1-- eLI MmiddotATF ORGANIZATioN

41

MEASUREMENT BASED ON

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LOCAL STATE middotOWNED COMPAN IES

---_ _ ____ --__ ______ _ QF WEST JAVA PROV~NCE) _-----_~

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nn 2014

INFORMATION AND TECHNOLOGY

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Mohd Zin Hassa n NlZamuddin bin

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LP 31Polytechnic MEASUREMENT TOOL FOR AN 44 Rita Komalasori 44

Band ung ORGANIZATIONS INFORMATION TECHNOLOGY IN VESTMENT - - -------

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I I Piksi Ga nesha 1I ARTIFICIAl INTELLIGENCE ANO TS-+I-- -R-i

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T HE APPLICATlON OF COBIT 5 FRAMEWORK ANALYSIS IN

51 INFORMATION TECHNOLOGY

GOVERNANCE=-_ --__-i_

DESIGN OF MODEL MAKING 3 UIMENSIONAL FACIAL EXPRESS ION l 5l

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PROCESS (EUP)(CASE STUDY SANG

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56 Abdul Azi Sha h 56Hassan Nur Afiqah BLI NO PEOLE

Polytech nicBintl Mohaini

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57 SENSOR FOR HOME SECURITY USING 57Isoi Anisah Polytechnic Bandung

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~-

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Polytech nic Nurhaeti IN HMljSCADA SYSTEMS

INFLUENCE OFTHE USE OF

NFORMATION SYSTEMS IND Piksi Ganesha

59 Sep ti Noer Lailela p 1 h B d ORGANIZATIONAL CULTURE AGAINST 1 59 [ 0 ytEe I e an ung EMPLOYEE PERFORMANCE I i ~ PT LEN INDUSTRI (PERSERO) THE IMPLEMENTATION OF A METHOD

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- =_c---_-_ _ _ _ _ _ -___-ceAMF DAKON ---c

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ae uno unan w IN THE CLOUD

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lnformatika OF CLOUD COMPUTING TECHNOLOGY

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Andika Agung Eka Telem aties TCchno logy RASP BERRY PI IN HI GH SCHOOL OF TELKOM TELEMATICS TECHNOLOGY Wahvudi

Piks i Ganesha THE PATTERN Or INTEGRATE D CITY64 64Agusti n Rozalena PolytechniC Bandung ~RAND COMMUNICATION

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_ _ Oi pan cga ra __RESI STANCE OF THE MDS --- - _--shyi-I DESIGN MODEL G2Gi (GOVERNM ENT TO GOVERNMENT)

Piksi Ganesha 66Edi Suharto CASE STU DY 66

Polytechmc Bandung INVENTORY SYSTEM OF GOVERNMENT

PROPERTY OF WEST lAVA

VI

~ -_ -- USING INFORMATION TECHNOLOGY

67 Anton Sukamto Akattlkom Bogor rrHROUGH Emiddot(OMMpoundRCE IN IMPROVING 67

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TEACHER TRAINING AND

6B M Farid Rifai middota neshaPksi G

Polytechn Ie Bandung EDUCATiON PROCRAM EVA LUATION

INFORMATION SYST EM USING A 68

RATIONAL UN IFIED PROCESS (RUP) METHOD AT PP PPT K BMTI BArmUNG-

CAPTI VE PORTAL APPLICAT ION IN WIRELESS COMPUTER NETWORK

Piksi Ganesha FOP HOTSPOT SERVICE69 Hendra latnika 69

Po lytcchn ic Ban dung US IN G CHILLISP OT AND RAD IU S

SERv ER_shyTHE DESIGNING INFORMATION

SYSTEM AR(HITECTUREPiks i Ganesh a70 Yud a Syahidin 70VISIiiNC OF PATJ ENTS USING

Len Herfiyanti Polyte( hn ic Bandung RATIONAL UN IFI ED PROCESS (RUP)

-----___ --L__ I fA CASE STUDY Ar R5UO BANDUNG)=----

HEALTH INFORMATION MANAGEMENT

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r-+- -cc-------+I--=-------+I- TH E EFF ECT U COUNS W NG I POSTPARTUM TO USE

Christi na Pernalun IAkadem i Keb idanan CONTRAC EPTION TOOLS IN71 71

I Kism oyo j Yogya kana I MUJAHIDAHS MATERNITY HOME

SRIMARTANI PIYUNGAN BANTUL

In Yu GYAKA RTA

DIFfERENCES IN ATTITUDES BETWEEN PSYC HOLOGI STS AN D

Sofia Mahlevi Ciputra University II IPHYSICIANS TOWARD SPIRITUALITY 12

I Andrian Li em Su rabaya CO MPLEM ENTARY -ALT ERN ATIVE

MEDICINE (CAM) IN SURABAYA II i RELATED IN FO RM ATION SOURCES

I ON REP RO DUCTi Ve HEALTHEn dang

Akadem i Kebidanan PREPAREDNESS DEALING WITH73 Khoir unnisa 73

Yogyakarta MENARCHE IN GRADE V AND VI SO SSTKebMKes

STATE WOlD 2 BANGUNHARIO

5EWON BANTUL YEAR 2013

EVAUATION OF AMPEROMETRY Ally Kafesa Eriska

Sekolah T inggi IIm u METHODS ON BLO OD GLUCO SE74 Agustina Yapmono 7

Ke se hat(ln Raj(lwali MEASUREMENTS USING Cep Wahyu

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75 Ckl Nur Rahay u 75IN TH E VILLAGE DISTRICTYogyakaJta ____ __ _ _-1 MAN~~~AN_DJNGO BANLt ~ 1Q5 _ _ l I ___--_shy

VII

viii

--I TH E RELATION BETWrpound N TH e

Esa Unggu l NU RSES SATISFACTION TOWAR DS

137 Dina Mairissa TH E OUTPATIENTS MEDICAL 137University

RECORD S DI STRIBUTION AT GRHA KED OYA HOS PITAL 20 4

THE RELATION BETWEEN KNOWLEDGE AltiTUDE AND

Ceria Fe biana Piksi Ga nesha

TRA DERS PRACTIC E WITH TH E

139 Wempi Eka Polytechnic

EX ISTENCE OF FORMALIN 139 Rusmana CONTA INED WET NOODLES AT

SOR EAN G TRADITIONAL MARK ET KA BUPATE N BAN DU NG

Piksi Ca nesha

139 K Priharton o A H Polytech nic MED ICA L RECORDS FROM PA PER TO 139

Bandung PAPER LESS

~WI xiv

--LOGICAL FRAM EWORK APPROACH

(LFA) MODEL AS AN APPROACH IN Piksi Ganesha EFfiCI ENCY OF MEDICAL RECORD

8S K Prihartono AH Polytechnic MANAGEMENT BY BARBER 8S Ba ndung JHONSON M ETHOD FOR POLICY

DECISION IN AL ISLAM HOSPITAL

BANOUNC

GENE THERAPY THE EFFECT OF

Jessica Novieta Rusli Piksi Ganesha INJECT ING SIRNA

86 Afe ndi S5i MSi

POlytechnic ANGIOTENSINOGEN ON WISTAR 86 Bandung STRAIN MALE RATS (RA1TUS

NORVECfCUSI 81000 PRESS URE

Shinta Dev i QUALITY OF LIFE (QOl)

87 Rossaline Andrian Ciputra Universiry DESC RIPTION FROM SADHANA

87Surabaya YOGA STUDIO MEMBERS IN

Liem SURABAYA A PILOT STUDY -shyTHE EFFE CTS OF MASSAG E

Dien Fitria ReIna Akademi Kebidanan COUNTERmiddotPRESSURE ON LAGOR

88 Hcru Se(yorini Yogyaka r ta

PAIN REDUCTION IN BINA SEHAT 88 jumiyati MATERNITY HOME

BANTUL YOGYAKARTA

I

PERFORMANCE OBSERVED FROM

I MANAGEMENT SYSTEM OF I OCCUPATIONAL SAFETY AND I I

89 Abdul Rahim

I Manda la Waluya HEALTH (SMK3) TH RO UGH

89 ISya middotban College of Ke ndart MOTIVATION ON F1SH PROCESSING

I CO MPANY IN THE INDUSTRIAL

IAREA OF OCEAN FISHERIES PORT KENOARI

Eny Retna Akademi Kebidanan

KNOWLEDGE AND SUPPORT THE

90 Ambarwa ti Elsa Y YogyakJrta

FAM ILY WITH ANX IETY ON 90 Tamen o Si ti Abdilah PRIMIGRAVIDA lCOM PARISON OF KNOWLEDGE

I AN D ATTITUDE TOWARD I I

91 Ike Natalia Ciputra Universi(y COMPLEMENTARY middotALTERNATIVE

91Andrian Liem Su rabaya MEDICINE (CAM) MUSIC THERAPY

AMO NG PSYCHOLOGI ST S AND PHYSICIANS IN SURABAYA

THE IMPLEMENTATION OF CODING

Nuryati Surya Gaja h Mada DIAGNOSIS AND PROCEDURES IN

92 PANT RAPIH HO SPITAL 92Nugroho M2rkus University

YOGYAKARTA BASED SM

ELEMENTS OF MANAGEMENT

Ainun jaryah Oahrir DE SC RIPTIVE ST UDY QUALITY OF

I93 Evelyn Christyanti Ciputra Universny

LIFE (QOL) Of PATIENTSmiddot USING 93Trisula Andrian Surabaya

I ACUPUNCTURE IN SURABAYA ILiem I J

- -----shyPILOT STUDY ENTREPRENEURIAL

WJTH Andrian Liem Ciputra Uni-rersity

SUSTAI NABrLlTY Of 94 Kuncoro Dewi COMPLEMENTARY -ALTERNATIV E 94

Rahmawari Surabaya

MEOKINE (CA M) SERVICES IN SURABAYA-_ ----- -_

THE INFLU ENCE OF MED ICAL RECORDER CO MP ETE NCE

Sali Setiatin Shinta Piisi Ganesha TOWARDS

-I -95 Williani Farida POlytechnic 95

DIAGNOSI SCODEF ICATION

Gustini Band ung I

ACCURANCY ON THE HeA lTH BP) S tlt CLAIMS l- --- -shy

THE INF1U ENCE COMPETENCE OF gt

Tedi Hidayat Annisa Piksi Gallesha DO CTORS NURSE AND MEDICAL i

RECORD TOWARD TH E 96 Khofifah Nurul Dwi Polyte chnic

QUALITY OF MEDICAL RECORD AT 96 Arya ni Bandu ng PARU ROTINSULU HOSPITAL

BAND UHG - shy _ _-shy -

Savilri Citra Bud THE USE OF SYMBOLS AND

Gadjah Mada ABBREV IATION RELATED TO KARS

97 Roro Ayu Sekar University STANDARD ACCREDITAT ION AT

97 Mayang Yogyakarta

PANTI RAPIH HOSPITAL

I II THE RELATION BETWEEN THE

Piksi Ganesha PROFESSION PRECEPTION OF

I 98 A Pu WY I Polytechnic

NURSERY ABILITY AND WORK 98

Emyha Fi skasari MOTIVATION WITH TH E NURSE-S ~ Bandung WORK PERFORMANCE AT ALmiddot

I ISLAM HOSPITAL BAfWUNG Dewi Sartika

rOMPARISON or QUALITY Of LIFE Indrayani Bony Mllt1wifEry

I 8eTWeEN VASCCTOMISW AND i

99 Wiem Lestari Academy NONmiddot VASECTOM ISEO MEN IN 99

Herman Susanto Padjadjaran DISTRICT OF KIA RAP EDES University PURWAKARTA REG ENCY

THE INFLUENCE OF COMPETENCE

Piksi Ganesha AND CHAMCTERISTICS or

Sali Setlatin lka MEDICAL RECORD TOWARDS 100 Kartisyah Leni Polytechni c THE QUALITY OF MEDICAL RECORD 100

Herfiyanti Bandung INFORMATION SYSTEM MANAGEMENT AT AL middot1SLAM

HOSPITAL

Andrian F Sia haan UGM Vocational ABORTION PROmiddotCHOICE AN D101 Midwifery EVALUATION OF BENEFICIAL

101 Hadianto Ismangoen

---shy

x

-

SOIO-HUMANIORA

NO NAME TITLE PACE Noremy Md Akhir

Universili Sains FLOO D DISASTERS IN MALAYSIA

102 Azlinda Alman M Malays ia (U SM)

THE PSYCHOSOCIAL ISSUES AND 102 Fadhil Nordin INTERVENTION -

LONG DISTANCE FAMILY

Bunda Mulia CO MMUNICATON (CASE STUDY

103 Lasmery RM Girsang Universlry

FAMILY COM MUNICATI ON 103 6ETWEEN HEAD OF FAMI LY WITH

FAMILY MEMBER)

Nove Eka Variant EVALUATION OF THE ROLE OF TA MAN BACAA N MASYPRAKAT

104 Anna Dyah Airlangga University (TBM) IN EMPOWERING $URABAYA

104 PJspitasa ri

CITY PEOPLE

Sulis Oyah Ca ndra MODA Ll11 SENS ITIVITY INFLUENC E

Panea Marga ON CO UNSELIN G COMMUNI CATION105 Judi $uh arso no

Univrrsiry TO FAR MER GROUPS IN 105

Setyani Hidayati PROGOLINGGO CITY

THE AUTHORITY Of RELIGION 106 Ahmad Dami ri STIES Darul Ulum TR IAL IN THE RESOLUTION OF 106

SYA RIA ECON OMIC LEGAL ACTION

Piksi Ganesha MORPHOLOGI CAL ANA LYSIS ON THE

107 Wahy u Tri mastu li Polyttgtch nic Ba lldung

WO RDS IN THE W INDOWS 107 I PROGRAM

I- Fauzi Chaniago Isak Piksi Ganesh a ON LINE TRAN SACTION FROM TH E 108 Abdul Gani PolytechniC BOl ndung PERS PECTIV E OF THE ISLAMIC LAW

108

Muhamad fadhil GLOBALIZING INFORMATION

TECHNOLOGY

109 Nurdin Ar i Canjar

Padjadjarm University ISSU ES AND CHALLENG ES IN 109 Herdiansah Wahyu

CONTEMPORARY INDONESIAN Gunawan

DEMOCRACY

Widya Manda la ED UCATION AS T HE ENRIC HINC

110 Ramon E Nadres Catholic Un[versiry I DIALOGUE BETWEEN TWO UNIQUE 11 0

PERSON S

Mochammad Tholib Universitas Islam THE ROLE OF INFORMATION

111 Sri Anik

Sultan Agung TECHNOLOGY TOWARDS T HE 111 Semarang TEACHERS PER FORMACE

TH E GREATNESS OF SHALAT IN INCREASING THE HUMANmiddot GOD

11 2 Asep Dede Kurnia STIES Daru] Ulum COMMUNI CATION QUALITY 112 TO FORM A GOOD ETHICS IN THE

DA ILY LIFE THE DISC RIMINATION BETWEEN DEWAN PERWAKILAN DAERAH

11 3 Nanang Koyim STIES Daru l U[um WITH DEWAN PERWAKILAN 11 3 RAKYAT IN T HE INDON ESIAN

CONSTIT UTIONAL

Santy Chri stinawati Piksi Ganesha ALAY LANGUAGE PHENOM ENON ON

11 4 Po lytechni c Ba ndung rACE BOOK

114

XI

--

-- ------ -

- - --

TH EIMPORTANCE OF FOR EIGN-- LANGUAGE COMPETENCIES IN Bunda Mulia

Nurdiana Usman GLOBALI ZATION ERA AND THEIR 115 A115 University -shy

IMPLICATIONSON FOREIGN

LAN GUAG E TEACHING

Catholic Un1VerSi~ Yuli Widiana W ldya Mandala METAP HO R IN POLITICS 116116

Madiun

Universitas Ci pu tra THE RO LE OF PSYCHOLOGY IN Theda Renanita 11 7117

Surabaya TOURISM INDUSTRY

STISI POL Dh arma GOOD GOVERNANC E PRINCIPLES AT Ita Prihanlika Sutiyo liBliB

Wacana Metro DESA

GUTTER IN TH E CO MICS AN ALTERNATI VE WAY FOR T HE

-

PiKsi GaneshaNeneng Yun ia rty DEVELOPMENT OF IMAGINATION119 119

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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xiii

~-~- -- I ~ALYSTS OF NEWS COiSlIMP-CION

CULI URE 10WA DS 8ACA Bl-_RMshy

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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Published by LPPM Pollteknlk Piksi GaneshO

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Page 7: BOARDS OF C01MITTEE

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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Published by LPPM Pollteknlk Piksi GaneshO

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Page 9: BOARDS OF C01MITTEE

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Piksi Ca neshaRin i Susilowa(i134

Polytechn ic

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Polytech n ic

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PERFO RMANCE IN OEPARTEM EN OF EDUCAT ION DI STRI CT BANDUNG

T HE ROLE OF HUMAN RELATIONS IN IM PROVI NGT HE QUALITY OF

EXCE LLENT SERVICE IN PT RISTRA GROUP BAN DUN(

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I134

135

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L_----_ _____L-_ _ ___ _ STUDENTS IN NO RTH~ltART~L__L-l

xiii

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CULI URE 10WA DS 8ACA Bl-_RMshy

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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Published by LPPM Pollteknlk Piksi GaneshO

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126 Endang Khoirunn

127 Farida Gust ini

128 Fint Had ia ty

~ Ion I M Iyh129 Ahyar IsmaI l Luky

I Abdullah

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RELATEO INFORMATI ON SOURC ES ON REPRODUCTIVE HEALTH Akad emi Keb ida nan PR EPAREDN ESSDEALIN G WITH

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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Published by LPPM Pollteknlk Piksi GaneshO

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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Published by LPPM Pollteknlk Piksi GaneshO

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Page 12: BOARDS OF C01MITTEE

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SUSTAI NABrLlTY Of 94 Kuncoro Dewi COMPLEMENTARY -ALTERNATIV E 94

Rahmawari Surabaya

MEOKINE (CA M) SERVICES IN SURABAYA-_ ----- -_

THE INFLU ENCE OF MED ICAL RECORDER CO MP ETE NCE

Sali Setiatin Shinta Piisi Ganesha TOWARDS

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DIAGNOSI SCODEF ICATION

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ACCURANCY ON THE HeA lTH BP) S tlt CLAIMS l- --- -shy

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Gadjah Mada ABBREV IATION RELATED TO KARS

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PANTI RAPIH HOSPITAL

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Piksi Ganesha PROFESSION PRECEPTION OF

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NURSERY ABILITY AND WORK 98

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Herman Susanto Padjadjaran DISTRICT OF KIA RAP EDES University PURWAKARTA REG ENCY

THE INFLUENCE OF COMPETENCE

Piksi Ganesha AND CHAMCTERISTICS or

Sali Setlatin lka MEDICAL RECORD TOWARDS 100 Kartisyah Leni Polytechni c THE QUALITY OF MEDICAL RECORD 100

Herfiyanti Bandung INFORMATION SYSTEM MANAGEMENT AT AL middot1SLAM

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NO NAME TITLE PACE Noremy Md Akhir

Universili Sains FLOO D DISASTERS IN MALAYSIA

102 Azlinda Alman M Malays ia (U SM)

THE PSYCHOSOCIAL ISSUES AND 102 Fadhil Nordin INTERVENTION -

LONG DISTANCE FAMILY

Bunda Mulia CO MMUNICATON (CASE STUDY

103 Lasmery RM Girsang Universlry

FAMILY COM MUNICATI ON 103 6ETWEEN HEAD OF FAMI LY WITH

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104 Anna Dyah Airlangga University (TBM) IN EMPOWERING $URABAYA

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Piksi Ganesha MORPHOLOGI CAL ANA LYSIS ON THE

107 Wahy u Tri mastu li Polyttgtch nic Ba lldung

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108

Muhamad fadhil GLOBALIZING INFORMATION

TECHNOLOGY

109 Nurdin Ar i Canjar

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Mochammad Tholib Universitas Islam THE ROLE OF INFORMATION

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TH E GREATNESS OF SHALAT IN INCREASING THE HUMANmiddot GOD

11 2 Asep Dede Kurnia STIES Daru] Ulum COMMUNI CATION QUALITY 112 TO FORM A GOOD ETHICS IN THE

DA ILY LIFE THE DISC RIMINATION BETWEEN DEWAN PERWAKILAN DAERAH

11 3 Nanang Koyim STIES Daru l U[um WITH DEWAN PERWAKILAN 11 3 RAKYAT IN T HE INDON ESIAN

CONSTIT UTIONAL

Santy Chri stinawati Piksi Ganesha ALAY LANGUAGE PHENOM ENON ON

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114

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TH EIMPORTANCE OF FOR EIGN-- LANGUAGE COMPETENCIES IN Bunda Mulia

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IMPLICATIONSON FOREIGN

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STISI POL Dh arma GOOD GOVERNANC E PRINCIPLES AT Ita Prihanlika Sutiyo liBliB

Wacana Metro DESA

GUTTER IN TH E CO MICS AN ALTERNATI VE WAY FOR T HE

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1 ANALYZED THE FUNOAM ENTAL Piksi Ganesha j FACTORS OF STOCK RETURN j

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Yogyakarta MANGUNAN DLINGO BANTUL 2014 COMPARATIVE RESEARCH STUDIES

bullbull Anita Putri ON ANXIETY LEV EL OF PREGNANT

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BandungErmiati NOT FACING THE BIRTH PROCESS

AT ALmiddot[SLAM HOSPITAL BANOUNG___ -----Piksi Ganesha CHARACTERIZATION OF SIMPLISIA

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130 II IPolytech nic or PRI MARY CA RE (ICPC) FOR

THE INFLUENCE OF THE EMP LOYEEE COORDINATIO N AND

Piltsi Ga nesha SU PERVI SIO NTOWA RDS THE

Polytechnic SERV ICE EXCELLENCE

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Kutai Bogor ANA LYS IS

Agricul tu ral Univ

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12 6

127

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Ambar Mulyono Universitas Scbelas BAMBOO HAN DYCRAFT AT 133 j133 1 Ken Sunar ko Mare t KECAM ATAN CEPER KA BU PATANI I

I KLATEN

Piksi Ca neshaRin i Susilowa(i134

Polytechn ic

Piksi Callesha135 Yunyun Ratna H

Polytech n ic

IMPLEM ENTATI ON Of EM PLOYE E MOTI VAT ION DISCI PLI NE AND

PERFO RMANCE IN OEPARTEM EN OF EDUCAT ION DI STRI CT BANDUNG

T HE ROLE OF HUMAN RELATIONS IN IM PROVI NGT HE QUALITY OF

EXCE LLENT SERVICE IN PT RISTRA GROUP BAN DUN(

- _ I

I134

135

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L_----_ _____L-_ _ ___ _ STUDENTS IN NO RTH~ltART~L__L-l

xiii

~-~- -- I ~ALYSTS OF NEWS COiSlIMP-CION

CULI URE 10WA DS 8ACA Bl-_RMshy

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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Published by LPPM Pollteknlk Piksi GaneshO

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NO NAME TITLE PACE Noremy Md Akhir

Universili Sains FLOO D DISASTERS IN MALAYSIA

102 Azlinda Alman M Malays ia (U SM)

THE PSYCHOSOCIAL ISSUES AND 102 Fadhil Nordin INTERVENTION -

LONG DISTANCE FAMILY

Bunda Mulia CO MMUNICATON (CASE STUDY

103 Lasmery RM Girsang Universlry

FAMILY COM MUNICATI ON 103 6ETWEEN HEAD OF FAMI LY WITH

FAMILY MEMBER)

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Piksi Ganesha MORPHOLOGI CAL ANA LYSIS ON THE

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Muhamad fadhil GLOBALIZING INFORMATION

TECHNOLOGY

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CONTEMPORARY INDONESIAN Gunawan

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Widya Manda la ED UCATION AS T HE ENRIC HINC

110 Ramon E Nadres Catholic Un[versiry I DIALOGUE BETWEEN TWO UNIQUE 11 0

PERSON S

Mochammad Tholib Universitas Islam THE ROLE OF INFORMATION

111 Sri Anik

Sultan Agung TECHNOLOGY TOWARDS T HE 111 Semarang TEACHERS PER FORMACE

TH E GREATNESS OF SHALAT IN INCREASING THE HUMANmiddot GOD

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130 II IPolytech nic or PRI MARY CA RE (ICPC) FOR

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135

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xiii

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CULI URE 10WA DS 8ACA Bl-_RMshy

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

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1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 16: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 9

THE ROLE OF DYNAMIC MODEL OF CUSTOMER ENGAGEMENT TOWARD CUSTOMER VALUE

Ardian Adhiatma

M A Irfan Rahmana Dept of Management Faculty of Economics UNISSULA Semarang Indonesia

E-mail ardianunissulaacid irfanrahmanayahoocom

ABSTRACT The added value of the company at this time can not always be built only through customer satisfaction but more to factors such as communication coaching and sharing of the company as stated in the customer engagement The purpose of this study is to know the role of dynamic models of customer engagement toward customer value Explanatory research is conducted on 50 owners managers and authorized personnel in corporate decision The sampling used is purposive sampling Furthermore there are three variables involved in this study those are customer engagement relationship quality and customer value The data of these three variables is obtained from questionnaires Partial least squares analysis with smart PLS 20 is used to determine the correlation within variables Customer engagement shows a positive results and significant influence to customer value either directly or indirectly through the relationship quality in which the influence of indirect coefficient (0499) is higher than the direct coefficient (0491) So it can be concluded that customer engagement has a role in improving customer value through relationship quality

Keywords customer engagement relationship quality customer value

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 17: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 10

A INTRODUCTION Nowadays Challenges in the business field have become increasingly tight and

complicated because the presence of dynamical complexities in the market values in which the needs and demands of customers as main stakeholders have changed massively The change of customers condition in demand occur because the presences of information and choices have grown rapidly Not only self-needs experiencing a change but also the ways customers access the needs also change from time to time In the past customer satisfactions were mostly determined by the quality of productsservices pricing and after-sales service Briefly its only three aspects that got too much attention marketers only focused in improving the quality of products pressing price efficiency to be affordable and opening outlets of after sales service Yet in the present day these aspects are considered not meet expectations customers want more of these aspects as a prerequisite for their satisfaction In conclusion it means that the needs of customers expectations has changed so that the programs and approaches to satisfy customers should also be conducted (Rustono 2010)

The phenomena as mentioned above also occur in courier Industries The rapid competition of courier industries in Indonesia is not only caused by globalization but also customers awareness of price and high demands The rapid growth of communication and technology also contribute to the increase of competition intensity since it gives customers access to more information about the wide range of products or services offered These conditions lead customers to have more choices in spending their money

The added value of the company at this time can not always be built only through customer satisfaction but also more to other factors such as communication coaching and sharing of the company as stated in the customer engagement Customer engagement is the peak of the companys relationship with customers to survive and thrive to launch new products to pay more attention into competitor products to sell more products from competitors Besides that the companies also have to implement Customer Relationship Management whereby customer engagement is one of its components At the level of customer engagement relationship built has already been a combination of rational and emotional aspects The quality of this relationship has reached the level of the inner closeness and long-term dimension (Shevlin 2011 in Vivek 2011)

The concept of customer engagement has also been frequently considered as a potential superior strength to predict and to explain the context of the service retention and customer loyalty (Bowden 2009 in Hollebeek 2009) Furthermore Customer engagement is a promising new concept and expected to exceed the contribution given by traditional relational construction including perceived quality customer engagement and satisfaction in explaining and predicting customer value (Hollebeek 2009) Customer value is defined as the emotional bond that exists between customers and manufacturers because the customers use the products and services of the company and then find that the product or service give them additional value (Tjiptono 2005)

The study by Hollebeek (2009) concludes that the customers engagement improve loyalty satisfaction empowerment connection emotional bonding trust and commitment Furthermore Kumar et al (2010) emphasizes that customers can be involved in creating value for the company in various ways first the customer lifetime value (customer buying behavior) second the customer referrals value (related to referral incentives of new customers) third customer influence value (related to customers behavior to influence other customers which increases the acquisition retention and share of wallet through communication among customers and existing prospects) and fourth is the customer knowledge value (surplus for the company with feedback from customers) Customer engagemet value (CEV) provides a comprehensive framework that can ultimately lead to more efficient marketing strategies that enable a higher long-term contribution to customers The study by Vivek (2011) proves that customers engagement in turn can positively influence the companys relationship with customers and raises good faith and intention to do business with the company

The capability of Customer engagement in predicting customer value has been adopted as a marketing strategy by PT Siba Courier Indonesia This strategy is implemented because until this time if it is compared with its competitors PT Siba Courier Indonesia is far behind from their competitors in terms of the availability of fleet infrastructure and age In the future PT Siba Courier Indonesia is predicted to be abandoned by its customers if only rely on the availability of

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 18: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 11

limited facilities and infrastructure The fact that the customers of PT Siba Courier Indonesia both in Jakarta and Semarang are still loyal to use the services of this company and even if they keep patient waiting queue to obtain service because the company have overload in order delivery If in general to improve the competitiveness and to maintain the survival of the company efforts are made through internal factors (improvement of service quality provision of infrastructure and facilities services technological advances etc) in this study exactly at PT Siba Courier Indonesia the related cases are not found Therefore it is interesting to do a more focused study on the role of dynamic models of customer engagement toward customer value in the PT Siba Courier Indonesia

B LITERATURE REVIEW

Customer Engagement Customer engagement (CE) is the intensity of customer participation by representatives

of the organization and through other customers in the process of collaborative knowledge exchange (Wagner and Majchrzak 200720) in Vivek (2011) Engagement refers to customersrsquo perception toward the importance or personal relevance of objects events and activities In this case Customers will acquire that a certain product has a personal relevance and relationship with them Relationship quality

The relationship quality or connections is represented through real-image of relationship and individual experience of each party in the relationship A subjective connection is obtained through positive passion energy matter and togetherness (Quinn and Dutton 2005 Heaphy amp Dutton 2008 in Vivek 2011) in which Two people involved in the connection and active participation (Heaphy and Dutton Vivek 2008267 in 2011)

In this study connection is defined as a positive emotional relationship that customers have a sense of belonging to the companies The quality of relationship construction is based on the amount of time spent in the workplace employees are significantly influenced by their relationships formed in the workplace so the connection significantly influences the function of the organization Customer value

The concept of customer value (CV) by Kotler and Keller (2009 14) is the combination of quality service price of products or services Furthermore Customer value is the dispute between the amount of value for customers and the total cost of customers and the amount of value for customers are customers expected profit of certain goods or services

According to Best in (Sumarwan et al 2010 30) the customer value is a benefit or profit obtained by customers lessened by the cost of the purchase Based on this concept customer value is derived from the economic customer and emotional benefits Economic Benefit is obtained from surplus of price and cost but not the cost of purchase which includes acquisition ownership usage maintenance repairment and disposal costs Customers Benefit is derived from the product appearance service and reputation Emotional Benefit is the overplus of the product to meet the emotional needs of the customer associated with psychological needs types of customers personality and customer personal value

C RESEARCH METHOD

The population of this study is all customers of PT Siba Courier Indonesia totaling 40 companies spread over two cities Semarang and Jakarta Because of limited number of population the total population is all designated as sample or census research Moreover it is also with the consideration that using total population as a sample will get a more representative description and minimize the error rates so that the data obtained will be close the real value The sample proposed is the companies which at least for three years have actively used services of PT Siba Courier Indonesia Then from each company it is selected two people from the owner and the manager or the other person who has the authority to make decision (the decision maker)

The data collection method is purposive sampling and the analysis techniques is performed by Partial Least Square and Sobel Test

Table 1

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 19: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 12

Research Variables and Indicators No Variables Indicators Shape

1 Customer engagement is the level of customers attention to the company

Sharing (CE1)

Likert Scale 1-5

Learning (CE2) Advocating (CE3) Socialization (CE4) Co-developing (CE5)

2 Relationship quality is quality of the relationship created between customer and companies

Trust (RQ1) Commitment (RQ2) Satisfaction (RQ3)

3

Customer value is the matched value perceived by customers on the services prices of the products quality received by them

Connection with Company (CV1) Goodwill (CV2) Word of Mouth (CV3) Affective Commitment (CV4) Intent to do Business (CV5)

Data Analysis

PLS (Partial Least Square) is used to examine and test the hypothesis proposed PLS has advantages that lsquoit involves no assumptions about the population or scale of measurement (Fornell amp Bookstein 1982) and consequently it works without distributional assumptions and by nominal ordinal and interval scaled variables However one has to bear in mind that the PLS like any statistical technique also requires certain assumptions to be fulfilled Apart from the standard ones (ie the classical Gaussian linear ordinary least squares) regression models (see eg Gujarati 1995) the most important predictor of the assumption is the specification (Chin amp Newsted 1999)

D FINDINGS Based on data analysis of the study it can be explained the analysis of partial least

squares (PLS) as follows Inner PLS model results

The indicators of customer engagement consist of sharing (CE1) learning (CE2) advocating (CE3) socialization (CE4) and co-developing (CE5) The outline of the PLS model for the indicators proposed is shown in Table 2

Table 2 Test Results of Validity and Reliability of Customer Engagement Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CE 1 0919 9438 valid

0876 2 CE 2 0753 5330 valid 3 CE 3 0711 4915 valid 4 CE 4 0851 7639 valid 5 CE 5 0854 6314 valid

Sources Primary data processed in 2014

Table 2 is the result of convergent validity test 5 indicators of customer engagement have loading factor value more than 05 by the T statistical value of all indicators greater than T Table by 196 so that all indicators of customer engagement can be said to be valid The order of the strongest to the weakest indicator is CE1 (sharing) CE5 (co-developing) CE4

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 20: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 13

(socialization) CE2 (learning) and CE3 (advocating) Based on the composite reliability test of indicator measuring the construct it shows a satisfactory results in the amount of 0876 meaning that the construct of customer engagement can provide relatively similar results when it is measured again by the same subjects

The indicator of Relationship quality consists of three indicators namely trust (RQ1) commitment (RQ2) and satisfaction (RQ3) The results of the PLS model for the outer indicators is shown in Table 3 below

Table 3

Test Results of Validity and Reliability of Relationship Quality Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 RQ1 0822 4959 valid 0731 2 RQ2 0812 5508 valid

3 RQ3 0785 5318 valid

Sources Primary data were processed in 2014

Table 3 is the result of convergent validity test 3 indicators of relationship quality has a loading factor values more than 05 and the value of the T statistic is higher than the T table by 196 so that all indicators of relationship quality can be said to be valid The order of the strongest to the weakest indicator is RQ1 RQ2 and RQ3 Based on the composite reliability test of the indicators measuring construction it showes a satisfactory results in the amount of 0731 meaning that the relationship quality constructs can provide relatively similar results if it is measured again by the same subjects

The indicator of Customer value consists of 5 indicators the connection with the commpany (CV1) goodwill (CV2) word of mouth (CV3) affective commitment (CV4) and intent to do business (CV5) The result of outer model is in Table 4

Table 4 Test Results of Validity and Reliability of Customer value Indicator Variables

No Indicator Test Validity Composite Reliability Loading T-Statistic Criteria

1 CV1 0 815 9 382 valid

0860 2 CV2 0 752 6 211 valid 3 CV3 0 712 4 022 valid 4 CV4 0 886 7 349 valid 5 CV5 0 837 7 649 valid

Table 4 is the result of convergent validity test 5 indicators of customer value has a

loading factor value more than 05 and the value of statistical Tgt T Table by 196 so that all indicators of customer value can be said to be valid The order of the strongest to the weakest indicator is CV4 CV5 CV1 CV2 and CV3 Based on the composite reliability test of indicators measuring the block construct it shows a satisfactory results in the amount of 0860 meaning that the construct of customer value can provide relatively similar results if it is measured again by the same subjects Inner PLS model results

Inner models describes the relationship among latent variables based on substantive theory The results of the bootstrapping output graphs display the relationship among variables such as customer engagement relationship quality and customer value as shown in Figure 2

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 21: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 14

Based on calculations in Figure 2 It is known that the direct influence of customer engagement on customer value is equal to 0491 with the indirect influence of 0984 x 0507 = 0499 It means that the indirect influence is higher than the direct Thus the relationship quality variable is the path of the relationship between the customer engagement and customer value Briefly it means that customer engagement can directly improve customer value by trying to increase the relationship quality first

Sources Primary data processed 2014 Figure 1

The relationship Model between the Customer Engagement Relationship quality and Customer value of PT Siba Courier Indonesia

Figure 1 also shows the magnitude of the determination coefficient The coefficient of determination is used to recognize how significant the influence of exogenous variables toward endogenous the higher the value of the coefficient of determination the higher the influence of exogenous variables on endogenous will be R-square value generated from the relationship between customer engagement with the relationship quality is 0969 meaning that the variation of relationship quality which can be explained by customer engagement is 969 while the remaining 31 is obtained from other variables Then R-square value of the relationship model between customer engagement relationship quality and customer value is 0988 it means that the variation of customer value that can be explained by the relationship quality and customer engagement is 988 while the remaining 12 are determined by other variables

Then the hypothesis test is performed by looking at the value of t count if tcount is higher than ttable (alpha 5 = 196) then the alternative hypothesis (H a) is accepted and H 0 is rejected and so that for the opposite Based on the PLS test the results of testing the relationship among variables can be seen in Table 9 and Figure 3

Table 5 Results of Inner Weight

No The relationship among variables Original Sample (O) T Statistics (| O Sterr |) Criteria

1 CE -gt CV 0491 2312 Significant 2 CE -gt RQ 0984 110053 Significant 3 RQ -gt CV 0507 2383 Significant

Sources Primary data processed 2014

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 22: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 15

1 The first hypothesis the customer engagement significantly influences the relationship quality Based on the PLS calculations result in Table 8 testing the first hypothesis about the

influence of customer engagement on relationship quality it is obtained the value of the estimated coefficient (β) of 0984 with t statistic value of 110053 This result is much higher than t-table value which is only 196 Then it can be concluded that there is a positive significant influence on the customer engagement variable toward the relationship quality Thus the first hypothesis is accepted

2 The second hypothesis the customer engagement significantly influences the customer value Based on the PLS calculations result in Table 9 testing the second hypothesis about the

influence of customer engagement toward customer value it is obtained the value of the estimated coefficient (β) of 0491 with t statistic value of 2312 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the customer engagement variable toward customer value Thus the second hypothesis is accepted

3 The third hypothesis relationship quality significantly influence customer value Based on the PLS calculations result in Table 9 testing the third hypothesis about the

influence of relationship quality on customer value it is obtained the value of the estimated coefficient (β) of 0507 with t statistic value of 2383 This result is higher than t-table value which is only 196 So it can be concluded that there is a positive significant influence of the relationship quality variable on customer value Thus the third hypothesis is accepted Sobel Test Results

Sobel test is conducted by testing the strength of the indirect influence of independent variables (customer engagement) toward dependent variable (customer value) through intervening variable (relationship quality) This test is done by Online Sobel Test Calculator for the Significance of Mediation by entering the regression coefficient and standard error values of the customer engagement variables to the relationship quality and the regression coefficient and standard error values of the relationship quality variable to customer value in which it gets the result as follows

Figure 4

Sobel Test Results Sobel test shown in Figure 4 shows the Sobel test statistic value of 23797 with a one-

side significance value of 0009 because the significance value is lt005 therefore it can be said that the relationship quality is the intervening variable of the correlation of customer engagement and customer value

E DISCUSSION In this study Customer engagement positively influences relationship quality it means

that the better the customer engagement the better the relationship quality between the customer and the company By involving customers such as Inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating customers to inform others about the companys products or services (advocating) motivating customers to promote products services of the company (socialization) and motivating customers to contribute ideas that might contribute to the improvement of performance and service of the companies (co-developing) then it will be able to create a good quality relationships between the companies and customers

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 23: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 16

This is in line with the findings by Saks (2006) which states that the employee engagement has been implemented as a means to explore and explain the organizational commitment and behaviors of the members and also applied as a predictor of customer ratings toward the companies Furthermore the finding of the study is also in accordance with the opinion of Salanova et al (2005) that engagement has also been recognized as a way to improve morale cohesion and psychological relationship between the customer and the company or organization

The quality of a good relationship is manifested by the growth of customer trust the presence of customer commitment to always use the companys services and customer satisfaction with the overall service provided by the company

Customer engagement in this study positively contribute to customer value the better the company does customer engagement efforts it will contribute to higher customer value Involving customers such as inviting them to share about the things to improve the performance of the company or promote cooperation between companies and customers (share) inviting customers to know more about the company (learning) motivating the customer to inform others about product and service of companies (advocating) motivating customers to promote products services company (socialization) and motivating customers to contribute ideas to improve the performance and service companies (co-developing) will be able to create high customer value

The studys findings are in line with the study conducted by Li and Dant in Vivek (2011) which concludes that the intensity of customer engagement will be positively related to the value received by customers By the time customers are treated very well and considered as part of the company it will raise the principle of reciprocity in which the customer will give the good attitude as good as what they have received by the company (Bagozzidalam Vivek 2011)

Companies Interaction to customers via initiative engagement strategies will make the reciprocity norm appear to customersrsquo engagement If the company successfully engage customers customers will recognize the benefits received and give return values to indicate behavioral intentions In the return of value received customers will have a good faith and affective commitment to the organization and may be willing to develop a strong relationship with the organization

Moreover in this study relationship quality give positive influence on customer value The better relationship quality the better the customer value will be It means that relationship quality is one of the important factors to increase customer value Relationship quality is needed to drive steer cultivate and maintain customer behavior towards the achievement of better corporate performance

Relationship quality in this study also serves as a mediator of the influence of customer engagement toward customer value Customer value will be stronger with the role of relationship quality in it Starting from involving customers by sharing it will create a good relationship between the company and customers Then One of the good form of relationship is the emergence of self-confidence of the customers toward the the company Based on these good relationships created customers will give a positive assessment to the company by the form of manifesting customer awareness of the companys survival (affective commitment) which in this study seems to show the highest loading value of all indicators of customer value

Empirically findings of this study support the finding by John (2008) that concludes that the success in fostering good relationship with customers is actually a beneficial thing that can bring profit for both parties The relationship created between the company and the customer will make communication better

After feeling satisfied and having created a good relationship then the customers will tell the companyrsquos advantage to others The information spread by the customer can build a good image about the company and it can bring in new clients or customers for the companyBy a good relationship not only company but also customers will get profits and advantages Benefits and advantages gained by customers also vary eg special price given by the company and get extra service for being a loyal customer

F CONCLUSION Based on the analysis and discussion in this study it obtains a general conclusion as

follows

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 24: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 17

1) Customer engagement have a positive significant influence on relationship quality It means that the better the customer engagement the better the relationship quality will be and the increased sharing programs between companies and customers is a way that can be used to improve customer engagement and gain trust of customers to be better 2) Customer engagement have a positive significant influence on customer value It means that the better the customer engagement the better the customer value will be and the improvement of sharing programs between companies and customers is a way that can be used to improve customer engagement and to establish customer awareness of the companiesrsquo survival company (affective commitment) And 3) Relationship quality have a positive significant influence on customer value it means that the better the relationship quality the better the customer value and establishing trust of the customer is a way to improve the quality of relationships and increase customer awareness of companies survival (affective commitment)

This study has limitations that is the study results can not be generalized beyond the sample of the study because the respondents used is only limited to customers of PT Siba Courier Indonesia representing Semarang and Jakarta city Thus to conduct similar study involving all customers of PT Siba Courier Indonesia spreading in many cities around Indonesia still need to be considered

BIBLIOGRAPHY Brodie JR Ilic A Hollebeek L 2011 Consumer engagement in a virtual brand community An

exploratory analysis Journal of Business Research xxx (2011) xxxndashxxx Cateora Philip R Graham John L 2007 Pemasaran Internasional 13th Edition Jakarta Salemba

Empat Chan S 2003 Relationship Marketing Inovasi Pemasaran yang Membuat Pelanggan Bertekuk

Lutut Jakarta Penerbit PT Gramedia Pustaka Utama Copulsky J R and M J Wolf 1990 Relationship Marketing Positioning for the Future The

Journal of Business Strategy Fandy Tjiptono 2005 Pemasaran Jasa 1st Edition Malang Bayu Media Publishing Fuad Masrsquoud 2004 Survai Diagnosis Organisasional Konsep dan Aplikasi Semarang Diponegoro

University Press Groumlnroos C 1994 ldquoFrom Marketing Mix to Relationship Marketing Towards a Paradigm Shift in

Marketingrdquo Management Decision Vol 32 No 2 pp 4-20 Hollebeek LD 2009 Demystifying Customer Engagement Toward the Development of a

Conceptual Model AMZNAC 2009 1-9 Imam Ghozali 2006 Structural Equation Modeling Metode Alternatif denganPLS (Kedua ed)

Semarang Diponegoro University Press Kotler Philip amp Keller Kevin Lane 2009 Manajemen Pemasaran Edisi 13 Jilid 2 Jakarta PT

Indeks Kotler Philip 2007 Manajemen Pemasaran Analisis Perencanaan Pengendalian Prentice Hall

Edisi Bahasa Indonesia Jakarta Salemba Empat Kumar V Lerzan A Bas D Rajkumar V Thorsten W dan Sebastian T 2010 Undervalued or

Overvalued Customers Capturing Total Customer engagement Value Journal of Service Research 13(3) 297-310

MacInnis dan Mello Jefrey A 2001 StrategicHuman Resources Management International Edition South Western Publishing Ohio

Mowen John C dan Minor M 2002 Perilaku Konsumen Jilid 1 Edisi Kelima (terjemahan) Jakarta Erlangga

Nammir Darman Sulaiman Sadiq Bayar Mohamed Rasheed Marane Aree Mohammed Ali 2012 Determine the Role of Customer engagement on Relationship Quality and Relationship Performance European Journal of Business and Management wwwiisteorgISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol 4 No11 2012

Peter Paul J and Olson Jerry C 2002Perilaku Konsumen dan StrategiPemasaran Edisi ke Empat (Terjemahan) Jakarta Penerbit Erlangga

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 25: BOARDS OF C01MITTEE

1st Piksi International Conference on Knowledge and Sciences 2014 Page | 18

Rustono 2010 Faktor-faktor yang Mempengaruhi Implementasi Customer Relationship Mangement (CRM) untuk Meningkatkan Loyalitas PelangganRagamJurnal Pengembangan Humaniora Vol 10 No 3 Desember 2010 153-160

Ryals L and S Knox 2001 ldquoCross-Functional Issue in the Implementation of Relationship Marketing Through Customer relationship Managementrdquo European Management Journal Vol 19 No 5 pp 534-542

Setiadi J Nugroho 2005 Perilaku Konsumen Jakarta Kencana Sugiyono 2008 Metode Penelitian Kuantitatif Kualitatif dan RampD Bandung Alfabeta Tjahyadi RA 2010Membangun Hubungan Jangka Panjang Pelanggan Melalui Relationship

Marketing httpmajourmaranathaeduindexphpjurnal-manajemenarticleview178 Vivek SD 2011 A Scale Of Consumer Engagement Disertasi Department of Management and

Marketing in the Graduate School of The University of Alabama Yahya Y 2008 Pengaruh Customer Relationship Management (CRM) dalam Meningkatkan loyalitas

Pelanggan httpfebudiluhuracidwp-contentuploads201105Pengaruh-Customer-Relationship-Management-Dalam-Meningkatka-Loyalitas-Pelanggan-Yohanes-Yahyapdf

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot

Page 26: BOARDS OF C01MITTEE

- -

(0)

I~ 1 PICKS 2014 Committee ISSN 2407 ~ l722 ~ POLITEKNIK PIKSI GANESHA Gedung Rektoratmiddotmiddot Kampus 1 JI jend Gatot Stibroto No 301 Bandung 40274 9171111~JJ

Published by LPPM Pollteknlk Piksi GaneshO

-Batidung lndonesIClmiddot