FORUM PENYEBARAN DATA HASIL PENYELIDIKAN LPPKN SIRI 2...

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FORUM PENYEBARAN DATA HASIL

PENYELIDIKAN LPPKN SIRI 2

8 MEI 2014

HOTEL CRYSTAL CROWN, PETALING JAYA

1 Background of Research

2 Problem Statement

3 Research Question & Objective

4 Literature Review

5 Theoretical Framework

6 Research Methodology

7 Analysis & Findings

8 Discussion & Conclusion

PRESENTATION OUTLINE

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Part of the Condition for the completion of MBA in University of Malaya (2013)

Area of Concentration – MBA - MARKETING

The reason for the topic “Customer Retention” – LPPKN moving towards self suffiency

Benefit – First step in the process of focusing on Business & Marketing

- Improve service delivery, Understanding the Clients

1. RESEARCH BACKGROUND

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2. PROBLEM STATEMENT

LPPKN is planning to focus on customer retention strategy due to the following reason:-

i) Health industry is getting highly competitive with many alternatives service provider

available for client i.e. KKM Clinics, private clinics, NGO (FFPAM)

ii) LPPKN is planning to move towards self-financing by actively involved in business ;

Felda, Tabung Haji as a model. LPPKN is heavily dependent on Government of

Malaysia in term of financing the operation.Service charge increment in 2007 is

insufficient & LPPKN need to find alternative to generate higher income.

iii) Inline with the LPPKN’s corporate vision & mission

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2. PROBLEM STATEMENT

Number of LPPKN Clinics – 58

Services – Reproductive Health

How to improve number of clients?

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What are the factors influencing the process of customer retention in LPPKN’s clinical service setting?

Does service branding, perceived value and service quality influence customer retention in clinical service?

Are some antecedents of customer retention towards clinical service setting are more significant than others?

Does demographic factors have influence on the

process of customer retention?

3. RESEARCH QUESTIONS

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• To analyze the relationship of service branding, perceived value and service quality to customer retention in clinical service settings.

• To examine the influence of service branding, perceived value and service quality in the proposed model of customer retention.

• To measure the importance of service branding, perceived value and service quality on customer retention.

• To analyze the influence and impact of demographic factors in the process of customer retention

3. RESEARCH OBJECTIVES

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Concept Literature Authors

Service

Service is an activity which has some elements of

intangibility associated with it. Service involved

some interaction with customers or property in their

possession and do not result in a transfer of

ownership

Services are different from physical products

because it cannot be stored, but the purpose of

both are same; to satisfy human need and wants.

Services can be termed as “experiential

possession”.

Chernatony &

Segal-Hom, 2003;

McDonald et al.,

2001

Fisher (1935)


Perceived

Value

Beginning 1990’s a new concept called customer

perceived value has drawn attention in the field of

marketing research

In a broad definition perceived value can be defined

as the benefits that customers received in relation

to the total costs. It can also defined as the

difference between perceived benefits and costs.

Ekram & Fazil, 2007

Woodruff, 1997;

Holbrook, 1994;

Zeithhaml, 1998

4. LITERATURE REVIEW

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Service

Branding

Brand assigns legal responsibility to the product

maker and provides a promise or bond with the

service provider or producer

Brands appears to reduce customer search costs

SB is a powerful means of differentiation and that

differentiation is significant competitive marketing

strategy.

Lesser et la.,1995

Biswas, 1992

Kapferer (1997),

Kotler (1988)


Service

Quality

SQ is defined as multidimensional which are

intangibility, heterogeneity and inseparability of

production and consumption.

Service quality can be categorized into 5

dimensions which are tangibles, reliability,

responsiveness, assurance and empathy.

SERVQUAL – widely accepted measurement scale

for service quality.

Medical Service Quality – not only focus on

medical care (doctor & nurse) but also transforms

to be patient-centered.

Parasuraman et al.

(1985)

Bath (2008)

4. LITERATURE REVIEW (cont.)

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Customer

Retention

Acquiring new customer is calculated as being

five times more costly than the expenses of

retaining existing customer. Long term customers

take less of company’s time, and are less sensitive

to price changes

CR is future propensity of a customer to stay with

the service provider

Repurchase intention is defined as a consumers’

actual behavior resulting in the buying of the same

product or services on more than one occasion.

Perceived value and service quality have an

important and positive relationship with

satisfaction and repurchase intention

(Healy, 1999).

(Ranaweera &

Prabhu, 2003).

(Fiese, 2004).

(Muhammad A.

Raza et al.; 2012)

4. LITERATURE REVIEW (cont.)

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5.2 Development of Hypotheses

H1 – There is a positive relationship between service branding and customer

retention

H2 – There is a positive relationship between perceived value and customer

retention

H3 – There is a positive relationship between service quality and customer retention

5.1 Research Framework

Perceived Value

Service Branding

Service Quality

Customer

Retention

IV

DV H1 +

H2 +

H3 +

5. THEORITICAL FRAMEWORK

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6. RESEARCH METHODOLOGY

• Quantitative

RESEARCH APPROACH

• Questionnaire survey & LPPKN’s annual report

DATA SELECTION

• Unit of analysis – LPPKN Clinics; Respondents – LPPKN Clinical clients

• 10 clinics K.L., Selangor & Negeri Sembilan out of 55 total clinic in Malaysia

SAMPLING POPULATION

• Purposive & convenience non-random sampling

SAMPLING TECHNIQUE

• Self-administered questionnaire, Paper based assessment & back to back translation

• 5 sections consist of 4 section for each construct with 7 point Likert scale & 1 section for demographic profile

QUESTIONAIRE DESIGN

• Total 300 questionnaire distributed with 235 returned (78.3%) whereby 227 are usable.

SURVEY IMPLEMENTATION

• Descriptive analysis, factor analysis, reliability test, correlation analysis, multiple regression & One-way Anova test.

DATA ANALYSIS TECHNIQUES

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Construct Dimensions Items Source

Perceived Value (PV) Functional Value (Installation) 4 Sa’nchez et al., 2006

Functional Value(Price) 4 Ralston, 1999

Functional Value (Professionalism) 5 Sa’nchez et al., 2006

Emotional Value (Control) 7 (Otto, 1997: Otto & Ritchie, 1996)

Emotional Value (Hedonics) 4 (Otto, 1997: Otto & Ritchie, 1996)

Social Value 3 Sa’nchez et al., 2006

Service Branding (SB) Satisfaction (Brand reliability) 3

Danes J.E. et al. (2011) Trust (Brand Fidelity) 3

Personnel Connections (Communalities) 3

Functional Connections (Exchange) 3

Commitment (Loyalty, Investment) 3

Service Quality (SQ) Tangible 4

Parasuraman, Zeithaml & Berry (1988) Reliability 5

Responsiveness 4

Assurance 4

Empathy 5

Customer Retention Customer Retention 3 Thiru Murugan R. & Clement S.J. (2013)

Total 67

6. RESEARCH METHODOLOGY

Operationalization Of Construct

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7. ANALYSIS & FINDINGS

7.1 Descriptive Analysis

83%

5% 8% 4%

RACE COMPOSITION OF THE RESPONDENT

Malay Chinese Indian Others

6%

60%

34%

GENERATION COMPOSITION OF THE RESPONDENT

Baby Boomers 1946-64 Gen X 1965-80 Gen Y 1981-2000

6%

31%

4%

25%

26%

8%

EDUCATION LEVEL OF THE RESPONDENTS

Primary/SRP/PMR SPM/MCE

STPM/HSC/Certificate Diploma

Degree Masters and above

62% 15%

23%

STATE OF DEMOCILE OF THE RESPONDENTS

Kuala Lumpur Selangor Negeri Sembilan / Seremban15


7.1 Descriptive Analysis (cont.)

29%

17%

3%

15%

7% 3%

26%

OCCUPANCY OF THE RESPONDENTS

Management / Professional (Private)Management / Professional (Gov.)Middle ManagementGovernment Servant (non-officer)Company / PrivateOwn Business / WorkHousewife / Not Working

15%

31%

34%

11%

5% 4%

INCOME LEVEL OF THE RESPONDENTS

RM1,000 and below RM1001-RM2,000

RM2,001-RM3,000 RM3,001-RM4,000

RM4,001-RM5,000 RM5,001 and above

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Table 4.2 : KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .936

Bartlett's Test of Sphericity

Approx. Chi-Square 19,748.953

df 2016

Sig. .000

Kaiser-Meyer-Olkin (KMO) value of 0.936 and Bartlett’s Test proven

significant (p<0.05), the exploratory factor analysis was considered

appropriate for the test. Principal component analysis was used to

transform the items into related grouping/components.


7.2 Factor Analysis

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Rotated Component

Matrixa

Component

1 2 3

Pv26 0.848

Pv25 0.773

Pv23 0.747

Sq1 0.724

Sq4 0.715

Pv22 0.714

Sq2 0.71

Pv19 0.697

Pv20 0.687

Pv12 0.664

Pv16 0.662

Pv11 0.66

Pv24 0.642

Pv10 0.639

Pv21 0.567

Sq8 0.547 0.503

Pv3 0.541

Sq5 0.538

Pv13 0.527

Sq15 0.521

Pv15 0.517

Sq16 0.516

Pv8 0.809

Pv6 0.801

Pv7 0.791

Pv5 0.757

Sb11 0.624

Pv9 0.553

Rotated Component Matrixa

Component

1 2 3

Sq21 .913

Sq19 .887

Sq22 .875

Sq13 .862

Sq20 .843

Sq12 .794

Sq18 .771

Sq11 .698

Sq10 .673

Rotated Component

Matrixa

Component

4 5

Sb12 .800

Sb13 .790

Sb14 .786

Sb15 .742

Sb4 .568

Sq9 .547

Pv1 .516

Sb8 .695

Sb7 .692

Sb9 .677

Sb6 .615

Sb3 .546

Sb10 .507

Principal Component Matrix

Dimension Identification No of Items Description

Perceived Value 28 Component 1 & 3

Service Quality 9 Component 2

Service Branding 13 Component 4 & 5

50 items out of 64 were retained

PV SQ SB


7.3 Dimensions of Service Branding, Perceived Value and Service Quality

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5 components explains

65% of variance

Construct No of

Items

Cronbach’s

Alpha

Service Branding 13 0.939

Perceived Value 28 0.978

Service Quality 9 0.954

Customer retention 3 0.871

Cronbach’s Alpha Scores for Dimensions Extracted

50 item out of 64 items + 3 items Customer Retention

+ Demography – 6 items Total 73 items


7.4 Reliability Analysis

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0.8-0.9 – v. good > 0.9 - exellent (Sekaran, 2003)

• Bivariate Correlation – relationship between two variables

• 1 or -1 shows linear relationship, + or – shows direction

Service

Branding

Perceived

Value

Service

Quality

Customer

Retention

Service Branding

Pearson

Correlation 1 .563** .390** .458**

Sig. (2-tailed) 0 0 0

N 227 227 227

Perceived Value

Pearson

Correlation 1 .287** .598**

Sig. (2-tailed) 0 0

N 227 227

Service Quality

Pearson

Correlation 1 .407**

Sig. (2-tailed) 0

N 227

Total Customer

Retention

Pearson

Correlation 1

Sig. (2-tailed)

N


7.5 Correlation Analysis

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7.6 Multiple Regression Analysis


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Model Summaryb

Model R R Square Adjusted R

Square

Std. Error of the

Estimate

1 .652a 0.425 0.417 0.616

a. Predictors: (Constant), Service Quality, Perceived Value, Service Branding

b. Dependent Variable: Customer Retention

Adjusted R Square shows how much variance in DV explained by IV, In

this Research it’s 41.7%. “MODERATE”

ANOVA results shows the Model is Statistically Significant (p< 0.01)

ANOVAa

Model Sum of

Squares df Mean Square F Sig.

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Regression 62.451 3 20.817 54.862 .000b

Residual 84.616 223 0.379

Total 147.066 226

a. Dependent Variable: Total Customer Retention

b. Predictors: (Constant), Service Quality, Perceived Value, Service Branding

CR Equation

• CR = 0.774 + (0.117) SB + (0.575) PV + (0.220) SQ

• CR = Customer Retention Constant = 0.774

• SB = Service Branding PV = Perceived Value

• SQ = Service Quality

Model Unstandardized

Coefficient

Standardized

Coefficient

t Sig.

B Std. Error Beta

(Constant) .774 .397 1.949 .053

Service Branding .117 .075 .100 1.555 .121

Perceived Value .575 .075 .476 7.706 .000

Service Quality .220 .053 .232 4.188 .000

7.6 Multiple Regression Analysis


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No Hypothesis Result Conclusion

1. H1 – There is a positive relationship

between Service Branding and Customer

Retention

p>0.05

(p=0.121)

Not supported


between Perceived Value and Customer

Retention

p<0.05

(p=0.00)

Supported


between Service Quality and Customer

Retention

p<0.05

(p=0.00)

Supported


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• OneWay ANOVA Analysis (Significant difference in Variance)

Variable Race Generation Education Occupation Income Location

(State)

Service Branding S

(0.02)

S

(0.00)

S

(0.00)

S

(0.00)

S

(0.00)

X

(0.461)

Perceived Value S

(0.00)

S

(0.026)

S

(0.00)

S

(0.00)

S

(0.00)

X

(0.372)

Service Quality X

(0.359)

S

(0.029)

S

(0.026)

X

(0.152)

S

(0.00)

X

(0.338)

Customer

Retention

S

(0.017)

S

(0.001)

S

(0.00)

S

(0.00)

S

(0.006)

X

(0.264)


7. 7 Demographic Profile Analysis

S – Significant X – Not significant 24

Variance within Demographic Variables (Sig. dif in mean)

Demography Items SB PV SQ CR

Malay (A) C D C

Race Chinese (B) C D

Indian (C)

Others (D)

B. Boomers 1946-64 (A) C C B C B

Generation Gen X 1965-80 (B) C

Gen Y 1981-2000 (C)

Primary/SRP/PMR (A) E F E F BDEF

Education SPM/MCE (B) D E F E F C

STPM/HSC/Certificate

(C) D E F E D E F DEF

Diploma (D) C E F

Degree (E)

Masters and above (F)


7. 8 One-Way ANOVA Analysis

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7.9 Mean for Items within Demographic Variables

Demography Items SB

(Mean)

PV

(Mean)

SQ

(Mean)

CR

(Mean)

Malay 5.35 5.26 5.69 5.67

Race Chinese 4.92 5.33 5.75 5.58

Indian 5.71 5.71 6.00 6.18

Others 5.20 6.20 6.00 6.20

B. Boomers 1946-64 4.88 4.94 5.06 5.06

Generation Gen X 1965-80 5.26 5.32 5.79 5.81

Gen Y 1981-2000 5.60 5.45 5.76 5.72

Primary/SRP/PMR 5.71 5.79 5.79 6.57

Education SPM/MCE 5.64 5.33 6.04 5.57

STPM/HSC/Certificate 6.00 5.90 6.60 6.80

Diploma 5.21 5.32 5.82 5.70

Degree 5.02 5.08 5.32 5.56

Masters and above 5.06 5.59 4.94 5.71


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8. DISCUSSIONS & CONCLUSSION

1. Perceived value is the most significant predictor of customer

retention in LPPKN. LPPKN customer retention strategy should

give due consideration on service charge imposed toward clients.

Ultimately, LPPKN’s objective towards increasing revenue by

retaining existing customer instead of solely revising service

charge.

2. Service quality contribute moderately towards customer retention

in LPPKN indicating that the perceived service quality are

indifference between LPPKN and other clinical service provider.

3. LPPKN service branding are insignificant towards customer

retention therefore shouldn’t be main focus on customer retention

strategy

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• Majority of clients are Malay (82%), mainly Generation X (60% ),

diploma holder & above (59%)

• All independent variables are positively related to DV

• Perceived Value and Service Quality have significant impact on

Customer Retention

• Service Branding is not significant to Customer Retention

• Demographic Variables have influence on SB, PV, SQ & CR


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• Result can be used as basis for improvement

• Management of LPPKN or other health service provider can use this as input in policy making

Significance

• Time – 2 Weeks, Geographic factor

• Rural area might show different result

• 82% Malay doesn’t show Malaysian population

Limitations of the Study

• Concentrate on Service Branding because it is insignificant

• Compare LPPKN with KKM Clinics

Suggestions for Future Research


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brands”. European Journal of Marketing, 37, 1095-1118.

2. Bath PA (2008), Health informatics: Current issues and challenges, Journal of

Information Science, Vol. 34(4): 501-518

3. Biswas, A. (1992). The moderating role of brand familiarity in reference to price

perceptions. Journal of Business Research, Vo. 25 (3), p251-262

4. Ekrem Cengiz & Fazil Kirkbir (2007). Customer perceived value: The development

of multiple item scale in Hospitals. Problems and Perspective in Management, 5-3,

p. 252

5. Fisher, Allan G. B., The Clash of Progress and Security, London, 1935.

6. Healy, P.M., Wahlen, J. (1999), "A review of the earnings management literature and

its implication for standards setting", Accounting Horizons, Vol. 13 No.4, pp.365-83.

7. Holbrook, M.B (1994), "The nature of customer value: An axiology of service in the

consumption experience", in Rust, R.T, Oliver, R.L (Eds),Service Quality: New

Directions in Theory and Practice, Sage Publications, Thousand Oaks, CA, pp.21-

71.

8. Kapferer JN. Strategic brand management: creating and sustaining brand equity

long term. (2nd Ed.). London: Kogan Page Limited; 1997.

REFERENCE

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9. Kotler, P. (1988), Marketing Management, 6th ed., Prentice-Hall, Englewood Cliffs, NJ

10. Lasser, W., Mittal, B. and Sharma, A. (1995), “Measuring customer-based brand equity”,

Journal of ConsumerMarketing, Vol. 12 No. 4, pp. 11-19.

11. McDonald, M. H. B., Chernatony, L. d., & Harris, F. (2001). “corporate marketing and

service brands”. European Journal of Marketing, 35, 335-352.

12. Muhammad A. Raza et al. (2012), Relationship between service quality, perceived value

and revisit intention in hotel industry. Interdisciplinary Journal of Contemporary Research

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13. Parasuraman, A., Zeithaml, V. A., and Berry, L. L. (1985). “A Conceptual Model of Service

Quality and Its Implications for Future Research.” Journal of Marketing, 49, 41–50.

14. Ranaweera, C., and Prabhu, J. (2003). “The influence of satisfaction, trust and switching

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Model and Synthesis of Evidence," Joumal of Marketing, 52 (July), 2-22

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