determinants of student loyalty in higher education: a...

Determinants of Student Loyalty in HigherEducation: A Tested Relationship

Approach in Latin America

JOSE I. ROJAS-MENDEZSprott School of Business, Carleton University, Ontario, Canada

ARTURO Z. VASQUEZ-PARRAGACollege of Business Administration, University of Texas-Pan American, Edinburg, Texas

ALI KARADivision of Business and Economics, University College, The Pennsylvania

State University, York, Pennsylvania

ARCADIO CERDA-URRUTIAFacultad de Ciencias Empresariales, Universidad de Talca, Talca, Chile

ABSTRACT. Student loyalty is a critical measure in the success ofhigher education institutions that aim at retaining students until gra-duation and then attracting them back. This study examines the rela-tive importance of relationship pathways among key factors affectingstudent loyalty in the following order: perceived service quality, satis-faction, trust, and commitment. The findings reveal that perceived ser-vice quality and student satisfaction do not translate directly intostudent loyalty, but, rather, indirectly through the mediation of trustand commitment. Implications of the findings are discussed.

RESUMEN. La lealtad del estudiante es un indicador crıtico paramedir el exito de las instituciones de educaci�oon superior que deseanconservar a los alumnos hasta su graduaci�oon, y atraerlos nuevamentem�aas tarde. Este estudio examina la importancia relativa que tiene eldesarrollo de esta relaci�oon cuanto a los principales factores que afec-tan a la lealtad estudiantil, en el siguiente orden: calidad percibidadel servicio; satisfacci�oon, confianza y compromiso. Las conclusiones

Received April 25, 2008; revised August 4, 2008; accepted April 13, 2009.Address correspondence to Jose I. Rojas-Mendez, Associate Professor of International

Business and Marketing, Sprott School of Business, Carleton University, 925 Dunton Tower,1125 Colonel By Drive, Ottawa, Ontario, K1S 5B6, Canada. E-mail: [email protected]

Latin American Business Review, 10:21–39, 2009Copyright # Taylor & Francis Group, LLCISSN: 1097-8526 print=1528-6932 onlineDOI: 10.1080/10978520903022089

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demuestran que la calidad percibida del servicio y la satisfacci�oon delestudiante no se traducen directamente en su lealtad, sino que laafectan indirectamente, a traves de la mediaci�oon de la confianza yel compromiso. Presentamos una discusi�oon de sus consecuencias.

RESUMO. A lealdade do aluno e um indicador decisivo para osucesso das instituicoes de ensino superior que visam reter osalunos ate a graduacao e atraı-los de volta posteriormente. Esteestudo examina a importancia relativa dos caminhos de relacio-namento entre os principais fatores que afetam a lealdade doaluno, nessa ordem: qualidade do servico percebida, satisfacao,confianca e compromisso. As descobertas revelam que a qualidadedo servico percebida e a satisfacao do aluno nao sao diretamentetraduzidas em lealdade do aluno mas, sim, de forma indiretaatraves da mediacao entre a confianca e o compromisso. Saodiscutidas as implicacoes das descobertas.

KEYWORDS. commitment, higher education, perceived servicequality, satisfaction, student loyalty, trust

INTRODUCTION

Even though the concept of relationship marketing has begun to influencemarketing practices and academic research in various areas and industries,it is, for the most part, ignored by higher educational institutions (Henning-Thurau, Langer, and Hansen, 2001). Statistics indicate that more than 40% ofall college entrants in the United States leave higher education withoutearning a degree, 75% of these students drop out in the first two years ofcollege, and 56% of a typical entering class cohort will not graduate fromthat college (Tinto, 1975, 1993). More recent statistics indicate that 26.4%of freshmen in the United States do not return the following fall semesterand that 46.2% of students fail to graduate (Reisberg, 1999).

Similarly, statistics show that 74% of all college entrants in Chile in 1993left higher education without having earned a degree by 1998 (Bernasconiand Rojas, 2002). The dropout rate in the first year of college for professionalcareers was 30% during the same period. Yet, in two-year college programs,the dropout rate was 54% for 1997–1998 (Bernasconi and Rojas, 2002).

To help reverse such trends, college administrators will have to establishappropriate programs that promote, establish, develop, and maintainsuccessful long-term relationships with both current and former students.However, such programs have to be based on a clear understanding ofhow long-term relationships with students can be developed and sustained.

This study attempts to explain long-term student loyalty in highereducation institutions by examining key factors influencing the process

22 J. I. Rojas-Mendez et al.

of generating loyalty during the school years. Those factors (perceivedservice quality, satisfaction, trust, and commitment) are articulated in amodel that is assumed to be comprehensive enough to explain loyalty.Other studies that have examined student loyalty in higher education insti-tutions may have used other factors or included one or more factorsinvestigated here but then failed to provide a comprehensive explanationof how long-term student loyalty is generated and sustained. Alves andRaposo (2007) included university’s image perceived by students andstudent satisfaction as potential predictors of student loyalty in Portugal.Similarly, Helgesen and Nesset (2007) studied the drivers of student loyaltyin a Norwegian University College and focused on image of study pro-gram, image of the University College and student satisfaction as antece-dents of student loyalty. Other studies may have examined studentloyalty after graduation and successfully found that such loyalty involveslong-term relationships (Henning-Thurau, Langer, and Hansen, 2001).Yet, it is unclear how post-graduation loyalty is generated unless it isbacktracked to the school years in order to understand its sources andantecedents.

College-student long-term relationships are first examined based on theliterature. A conceptual model of student loyalty is then introduced, dis-cussed, and used to derive some hypothesized relationships. The methodol-ogy used to generate and analyze the empirical data is spelled out. Finally,the results obtained are described and discussed to arrive at research conclu-sions and practical recommendations.

LITERATURE REVIEW

College-Student Long-Term Relationships

Although student performance may not be studied as a fundamental productof consumption, student behavior can certainly be studied from the perspec-tive of consumer behavior. A student is also a consumer—despite the pecu-liarity of this designation due to the nature of education. He=she consumeseducational services just like any other and, thus, can be studied as a consu-mer of educational services.

A comprehensive piece of research in this area is a study carried out byHenning-Thurau, Langer, and Hansen (2001) in which perceived servicequality, trust, commitment, and loyalty are included as the main constructsto investigate the relationship between educational organizations and theirstudents. Consequently, they proposed post-graduation loyalty as the mainobjective of educational institutions. Yet, their study neither included thelong-term process by which students generate loyalty to their institutionnor the concept of satisfaction—a significant factor in other studies oflong-term relationships.

Student Loyalty in Higher Education 23

Loyalty

Loyalty involves a process in which customer’s cognition, affect, conation,and behavior take place (Oliver, 1999). We focus on loyalty involving anidentifiable intention to behave, such as repurchasing a specific brand or pro-viding a financial or non-financial support to one’s alma mater.

In educational services, loyalty requires developing a solid relationshipwith students who eventually provide the financial basis for future universityactivities (Henning-Thurau, Langer, and Hansen, 2001). In this framework,student loyalty is a sort of strategic competitive advantage because (1) seek-ing new students is definitely more cost intensive than keeping existing ones,and (2) it is assumed that student loyalty may pay off after graduation, asalumni continue supporting their academic institution, not only by word ofmouth but also through financial contributions to the institution and throughjob offers to new graduates.

Antecedents of Student Loyalty

Antecedents of student loyalty have been identified in previous research.Two streams of research are relevant when explaining student loyalty.One emphasizes service quality; the other one emphasizes long-termrelationships.

Service Quality

In educational relationships, service quality is treated as ‘‘people-based’’rather than ‘‘equipment-based’’ (Thomas, 1978). Moreover, Tang and Zairi(1998a, 1998b, 1998c) found that university staff members are moreempowered than employees in other service industries, such as financialinstitutions, due to greater autonomy in communicating with and assistingstudents. Therefore, we should expect that human interaction (e.g.,student-program administrator, student-instructor, and student-secretary)play a significant role in defining and assessing service quality in educa-tional settings.

Parasuraman, Zeithaml, and Berry (1988) define perceived service qual-ity as ‘‘a global judgment, or attitude, relating to the superiority of the ser-vice.’’ Perceived service quality is what the consumer feels a firm shouldprovide, whereas satisfaction is the result of comparing expected perfor-mance with actual performance.

Long-Term Relationships

The literature on long-term relationships has been concentrated on the rolethat satisfaction, trust, and commitment play in such relationships.


Satisfaction

There is no clear consensus among researchers on the definition of satisfaction.However, most definitions refer to an evaluative, affective, or emotionalresponse (Oliver and Swan, 1989) that evolved with the experience a consumerhas with goods or service over time. In a meta-analysis performed for satisfac-tion, Geyskens et al. (1999) found that this construct is the most popular oneamong empirical investigations of channel relationships. According to Ruekertand Churchill (1984), the construct of satisfaction is of key importance in under-standing channel relationship. However, there is no consensus regardingthe conceptualization and measurement of customer satisfaction (Geyskenset al., 1999).

Satisfaction is a cumulative construct that includes not only satisfactionwith specific products and services but also with the various aspects of theorganization, such as the physical facilities and the interaction with employ-ees. Moreover, satisfaction is positively related to trust (Anderson and Narus,1990; Dwyer, Schurr, and Oh, 1987). According to Michell, Reast, and Lynch(1998), satisfaction is a foundation of trust.

Trust

Trust has been found to be a key issue for a successful relationship betweentwo or more parties. For instance, Berry (1993) argued that trust is fundamen-tal to the development of loyalty toward retailers; Sherman (1992) identifiedtrust as pivotal to the success of strategic alliances; and Spekman (1988)labeled trust as the cornerstone of strategic partnerships. Therefore, it is nosurprise that the trust construct has been introduced as a factor that can pre-dict future intentions (Moorman, Deshpande, and Zaltman, 1993; Morganand Hunt, 1994).

In the educational field, students’ trust may be understood as the stu-dents’ confidence in the university’s integrity and reliability. Students’ trustis developed through personal experiences with the institution’s employees.If an educational institution desires to build long-term relationships with itsconstituents, it has to develop trust as part of the relationships. The lack oftrust may severely undermine long-term relationships (Andaleeb, 1994). Pre-vious research has shown that commitment in a highly dependent partner-ship, such as the educational one, can be significantly attenuated in theabsence of trust (Andaleeb, 1994).

Commitment

Similarly to the inclusion of trust into the relational marketing arena, the con-struct of commitment has received attention only recently as a mediatorbetween consumer satisfaction and consumer behavior (Dwyer, Schurr,


and Oh, 1987; Gundlach, Achhrol, and Mentzer, 1995; Morgan and Hunt,1994). According to Tinto (1975, 1993), student’s commitment is determinedby his or her degree of integration, both academic (participation in universitysocieties and committees) and social (friendships and acquaintances withfellow students). Thus, commitment refers to the fit between the student’sabilities, skills, and value system and the university’s expectations, demands,and values.

A Conceptual Model of Student Loyalty

A long-term student loyalty model would have a significant impact on thestudy of higher education institutions and their relationship with their stu-dents. It would also have some practical consequences for the collegeswho would like to apply relationship marketing.

Previously established key relationships constitute good points ofdeparture to model student loyalty. For instance, Oliver (1993) proposed aconceptual model that attempts to integrate both service quality and satisfac-tion by suggesting that perceived service quality is an antecedent of satisfac-tion. Spreng and MacKoy (1996) conducted a study specifically designed toassess the distinction between perceived service quality and satisfaction.Their results indicate that these two constructs are distinct even thoughservice quality is an antecedent of satisfaction.

Other studies have operationalized service quality and satisfaction astwo distinct but related constructs. Caruana (2002) found that satisfactionmediates the relationships between service quality and service loyalty. Yet,de Ruyter, Wetzels, and Bloemer (1998) and Bloemer, de Ruyter, and Wetzels(1999) found that service quality has a direct influence on service loyalty, dif-ferences among some industries, notwithstanding. Similarly, Lee-Kelley,Davies, and Kangis (2002) found that a higher level of perceived quality ofservice produces a higher intended loyalty; and Soteriou and Stavrinides(2000) proposed that service quality is needed to gain both competitiveadvantage and customer loyalty in bank services. Service quality, along withproduct quality and price, was found to correlate positively with both satis-faction and loyalty (Bei and Chiao, 2001; Boulding et al., 1993).

Using a meta-analysis of 71 studies dealing with satisfaction, Geyskenset al. (1999) found that satisfaction, trust, and commitment are conceptuallyand empirically distinct constructs. The study reports that trust is positivelycorrelated with satisfaction (r¼ 0.767) and commitment (r¼ 0.524) and thatthere is a pattern of causality from satisfaction to commitment. Satisfactionhas a positive effect on trust (b¼ 0.646, p< 0.001), which, in turn, has a posi-tive effect on commitment (b¼ 0.524, p< 0.001). In a study carried out inGermany with over 1,000 students, Henning-Thurau, Langer, and Hansen(2001) found that perceived service quality and students’ emotional commit-ment are the key determinants of student loyalty.


More specifically, using cross-sectional data, Geyskens et al. (1999)found that over time satisfaction will develop first, trust will develop in themedium term, and commitment will emerge only in the long term. Thisstudy attempts to partially replicate and extend those studies in the area ofeducation.

The model used in this study integrates the knowledge gained fromresearch performed in relationship marketing. It includes the constructsreviewed from the literature in a linear sequence: service quality, satisfaction,trust, commitment, and loyalty (see Figure 1). All the constructs are needed toexplain student loyalty. In other words, neither perceived service quality, norsatisfaction, nor trust, nor commitment should be studied in isolation. It istheir combined contribution that explains student loyalty and helps, in prac-tice, build student loyalty. Previous studies support the approach used here.

Thus, the following proposition:

P1 Student loyalty is directly explained by commitment, which in turn isdirectly explained by trust, which in turn is explained by satisfaction,which in turn is explained by service quality in the long-term relation-ship between higher education institutions and their students. Allantecedents of loyalty, except commitment, may have some effecton loyalty; but their influence is indirect, not direct.

This proposition can be converted into hypotheses. Each model pathwill be represented in a separate hypothesis, as follows.

H1: Student loyalty is positively and directly influenced by Commitment.H2: Commitment is positively and directly influenced by Trust.

FIGURE 1 Proposed model.


H3: Trust is positively and directly influenced by Satisfaction.H4: Satisfaction is positively and directly influenced by Perceived

Service Quality (PSQ).

METHODOLOGY

Measurement and Questionnaire

The questionnaire included three sections of questions for an exploratorystudy on the subject (see study 1). The first section consisted of 178 questionsdesigned to collect students’ PSQ in a full range of college experiences.Respondents were asked to indicate (1) the lowest score they would acceptbefore they can get upset, (2) the desired score, and (3) an actual assessmentregarding the item being considered. Thus, students were required to pro-vide three answers to each question related to college experiences.

The second section contained 21 items aimed at measuring constructsfor satisfaction, trust, commitment, and loyalty, as recommended in the litera-ture. To measure satisfaction, similar items to the ones used by Voss,Parasuraman, and Grewal (1998) were adopted. To measure trust andcommitment, items used by Henning-Thurau, Langer, and Hansen (2001)were used. To measure loyalty, we focused on capturing the students’ inten-tion rather than actual behavior (Evanschitzky and Wunderlich, 2006; Oliver,1999). Each construct had between 4 and 8 indicators, which were rated on a7-point Likert scale, ranging from 1 (strongly disagree) to 7 (strongly agree).Items were randomly ordered. Finally, the third section contained variousdemographic and socioeconomic questions.

A pilot study (previous to study 1) revealed no problems in the under-standing of the questions. Thus, the actual survey proceeded withoutchanges in the final questionnaire. A self-report questionnaire administrationin classroom settings was used.

Data Collection

Data were collected regarding students’ PSQ, satisfaction, trust, commitment,and loyalty toward the college of business from two samples of freshman,sophomore, junior, and senior students attending classes at multiple sectionsof a public Chilean university in two years, 2002 and 2004. The first samplewas aimed at an exploratory study (study 1), whereas the second sample wasaimed at a confirmatory study (study 2). Participation in the surveys wasvoluntary and about 30% of registered students completed the survey duringclass sessions.

The samples included 363 completed surveys in the first sampling and389 in the second, for a combined sample of 752 students. Table 1 revealsthe demographic characteristics of all samples.


RESULTS AND DISCUSSION

Study 1

In an exploratory study, items representing various facets of students’ PSQwere generated by (1) reviewing past research in services and satisfaction lit-erature; (2) implementing two focus groups, each with 10 undergraduatebusiness students (the first group bracketed into freshmen and sophomores,the second, into junior and senior students); and (3) establishing a focusgroup with 8 alumni. Focus groups were used to generate new insights fromthe source of service quality, taking into account that another measure, satis-faction, is more an outcome than a source. Students and alumni were chosenrandomly from a sample frame held at the College of Business and they wereinvited to participate in the one-hour session. All responses were kept con-fidential. Responses were recorded using written notes and a tape recorder.The main purpose of the focus group was to draw on student and alumnirecollections regarding attitudes, feelings, beliefs, and experiences vis-a-visservice quality and student satisfaction within the college and universityenvironment. This process resulted in the generation of 178 neutral (notpositive or negative) statements using 9-point rating scales (1¼ lowest;9¼highest).

TABLE 1 Sample Profile (in %)

Observed variablesInitial sample

2002Replicationsample 2004

Combinedsample

GenderMales 43.5 43.4 43.5Females 54.8 55.8 55.3Missing 1.7 0.8 1.2

CareerAccounting 26.4 40.1 33.5Business Administration 55.6 59.1 57.4Psychology 15.7 – 7.6Missing 2.2 0.8 1.5

Student SeniorityFreshman 37.5 14.4 25.5Sophomore 14.9 20.1 17.6Junior 16.5 24.4 20.6Senior 28.6 39.3 34.2Missing 2.5 1.8 2.1

Age Groups<20 years old 27.8 16.5 21.920–24 64.7 75.1 70.125–29 4.7 7.4 6.130þ 1.1 0.2 0.7Missing 1.7 0.8 1.2

Total Sample 100 (363) 100 (389) 100 (752)


Data were collected using the first sample for the 178 items reflectingPSQ and the 21 items reflecting long-term relationships (L-TRs). Results werefactor analyzed to obtain latent variables. An exploratory principal compo-nent analysis with Varimax rotation was performed. The results obtainedshow that PSQ is comprised of five dimensions, each one representing aservice source or quality as follows: (1) service quality from instructors, (2)service quality from program director, (3) service quality from secretaries,(4) service attitude, and (5) competence development. The first three dimen-sions represent service source, while the last two dimensions reflect qualityof the service. Each source dimension was formed by four indicators andeach quality dimension was formed by three indicators.

The items reflecting L-TRs were also factor analyzed using principalcomponents analysis with Varimax rotation. Results showed a four-factorsolution representing the 4 constructs used to examine long-term relation-ships: (1) satisfaction, (2) trust, (3) commitment, and (4) loyalty.

The reliability of the scales for all the constructs was established utilizingCronbach’s alpha. All coefficients are well above the accepted baseline of0.70 recommended by Nunnally (1978): service quality of instructors(0.74); service quality of program director (0.96); service quality of secretaries(0.85); service attitude (0.78); competence development (0.86); satisfaction(0.81); trust (0.74); commitment (0.85); and loyalty (0.77).

Factor analysis performed in the first study also served to clean theinstrument to obtain more-parsimonious measures of PSQ. Consequently,70 items of 178 were deleted from the questionnaire due to theirnon-significant contribution to the measure. The abbreviated questionnairewas used in the second study.

Study 2

Before examining the data for testing purposes, a purification of the modelinvolved several steps. Particular attention was given to the standardizedparameter estimates for causal paths and their respective standard errorand critical ratio. Those variables having loadings at below the recom-mended level of 0.40 for an analytic investigation (Ford et al., 1986) weredropped in further analyses. Second, all variables showing standardized resi-duals higher than 2.58 (Joreskog and Sorbom, 1988) were analyzed, andthose found to be constantly affecting the model by showing high level ofstandardized residuals were dropped. Finally, all t-values (critical ratios)lower than 1.96 indicated that the corresponding variable was not significant(Hatcher, 1994); hence, these were also dropped from the model.

As a consequence of the aforementioned steps, the final model consistsof 18 items dealing with PSQ, comprising five different factors: instructors(4), program director (4), secretaries (4), service attitude (3), and competen-cies development (3); and 12 items for the L-TR process: satisfaction (3), trust


(3), commitment (3), and loyalty (3). The items retained in each factor(see Appendix A) were included in the final model.

Combined Sample

The two samples were merged after testing for equivalence in order to exam-ine the stability of the structural model and the path coefficients. Indeed, allindices are similar across samples and, as expected, are only slightly lowerfor the merged sample. The GFI and AGFI are close to 0.90 and the RMSEAis under 0.05, indicating a good fit of the model to the data. The comparativefit index (CFI) is well above 0.90 for each independent sample. Similarly, theother indices of comparative fit and parsimonious fit are above their recom-mended thresholds. The Hoelter’s (1983) Critical N (which relates theadequacy of the sample size to the model) is well above 200, indicating thatthe samples are large enough to allow for an adequate fit to the model.

The results were first examined using a correlation matrix (Table 2) andmultiple regressions (Table 3). The correlation matrix shows that all correla-tion coefficients are significant at the 0.01 level. The regression results showthat all components of PSQ, except secretaries, significantly affect satisfac-tion, and that the proposed model of L-TRs to explain student loyalty issound. All predictors of loyalty generate an R-squared of .554 and all predic-tors, except PSQ, have highly significant unstandardized coefficients.

A structural equation model (SEM) that reveals the relationships amongthe latent variables was used to test for validity of the measurements and toevaluate the usefulness of the model. All possible relationships among latentvariables were tested by using alternative nested models to the one presentedin Figure 1. Hair et al. (1998) recommend that the comparison between alter-native models should be based on parsimonious fit measures. In fact, theanalyses showed that relationships other than those hypothesized were notsignificant or, if significant, were much lower than hypothesized. The

TABLE 2 Correlation Matrix for the Theoretical Constructs

Construct 1 2 3 4 5 6 7 8 9

Instructors (1) 0.73Program Director (2) 0.44 0.83Secretaries (3) 0.46 0.56 0.79Service Attitude (4) 0.49 0.52 0.52 0.71Competencies Development (5) 0.60 0.44 0.42 0.53 0.72Satisfaction (6) 0.42 0.38 0.28 0.40 0.41 0.82Trust (7) 0.44 0.46 0.34 0.43 0.43 0.68 0.70Commitment (8) 0.35 0.26 0.17 0.29 0.30 0.65 0.53 0.84Loyalty (9) 0.31 0.26 0.13 0.29 0.34 0.60 0.52 0.72 0.77

Note. Diagonal entries are Cronbach’s alpha coefficients; all others are correlation coefficients. All

correlation coefficients are significant at the 0.01 level.


non-significant relationships are not discussed here for the benefit of focus-ing on the substantial contribution of the article; therefore, the relationshipsthat were not hypothesized were not included in further analyses.

Confirmatory factor analysis (CFA) performed for both groups of con-structs, PSQ and L-TRs, revealed acceptable fit indices with all factor loadingsranging from 0.59 to 0.86 for PSQ, and from 0.61 to 0.86 for L-TRs. ReliabilityCronbach’s alpha coefficients are above the minimum threshold of 0.70recommended by Nunnally (1978): service quality of instructors (0.77); ser-vice quality of program director (0.92); service quality of secretaries (0.85);service attitude (0.75); competence development (0.78); satisfaction (0.84);trust (0.74); commitment (0.85); and loyalty (0.77). In addition, all factorsfrom the first sample were replicated and confirmed with the second sample.Such findings contribute to the validity of the variables included in the model(Byrne, 2001).

Regarding the PSQ model, in particular, both the competence of theteaching faculty and the staff are crucial to form the students’ PSQ in educa-tion. In other words, PSQ in an educational context is highly dependent onemployees’ performance during the service transactions. In this study, 3 of 5constructs reflect interactions between students and university personnel,highlighting the importance of the human element in the service transactionwithin the higher education setting. This approach is congruent with thecomposition of the SERVQUAL scale as proposed by Parasuraman, Zeithaml,and Berry (1988), in which items dealing with people interactions are cover-ing more than 60% of the total number of scale items.

Table 4 displays the hypothesized path coefficients. The highest coeffi-cients are commitment ! loyalty (0.93 for the replication sample) and satis-faction! trust (0.99 for the initial sample). Trust! commitment (0.78 for the

TABLE 3 Regression Results for the Basic Models

Dependent variable (model)Predictorvariable

Parameter(unstandardized) t p-value R2

Perceived Service Quality ComponentsSatisfactionIntercept 1.720 7.560 .000 .262Instructors 0.194 4.694 .000Program Director 0.134 4.159 .000Secretaries �0.052 �1.463 .144Service Attitude 0.154 4.082 .000Competences Development 0.127 3.601 .000

Students’ Long-Term RelationshipsStudent LoyaltyIntercept 1.163 7.817 .000 .554Commitment 0.534 17.175 .000Trust 0.128 3.456 .001Satisfaction 0.163 4.204 .000


TABLE 4 Path Coefficients (Standardized Regression Weights) by Sample and Model

Paths

Initialsample(beta)

Replicationsample(beta)

Combinedsample(beta)

Criticalratio

Relationshipis

significant

Full Initial ModelPSQ ! Commitment �0.081 �1.172 NoPSQ ! Loyalty �0.048 �0.740 NoPSQ ! Trust 0.289 6.089 YesPSQ ! Satisfaction 0.594 13.942 YesSatisfaction ! Loyalty �0.010 �0.070 NoSatisfaction ! Commitment 0.651 4.306 YesSatisfaction ! Trust 0.729 11.754 YesTrust ! Commitment 0.158 0.847 NoTrust ! Loyalty 0.239 1.381 NoCommitment ! Loyalty 0.755 12.376 Yes

Parsimonious Tested ModelCommitment ! Student Loyalty 0.87 0.93 0.910 20.278 YesTrust ! Commitment 0.75 0.78 0.768 13.296 YesSatisfaction ! Trust 0.99 0.95 0.972 14.227 YesPerceived Service Quality !Satisfaction

0.56 0.69 0.636 15.103 Yes

FIGURE 2 Structural model of students’ perceived service quality and long-term relationships.


replication sample) and PSQ ! satisfaction (0.69 for the replication sample)are significant but not as strong as the first two relationships. The proposedhypothesis was tested using these results by examining the critical ratios foreach hypothesized link (see Table 2). All ratios are significant as they are wellabove the minimum 1.96 and with the expected sign. Thus, the proposedhypothesis is well supported.

Moreover, the standardized total effects of each latent variable onstudent loyalty offer additional support for the hypotheses. Commitmenthas the highest total effect on loyalty (0.93 for the replication sample), ofwhich all is direct effect, whereas the other variables only have an indirecteffect on loyalty. Trust (0.72) and satisfaction (0.69), in that order, have stron-ger indirect effects on loyalty than PSQ (0.478). Together, PSQ, satisfaction,trust, and commitment explain 83% of student loyalty, as manifested in theresults of using structural equation modeling (see Figure 2).

CONCLUSIONS

The purpose of the study was to explain student loyalty in higher educationinstitutions by examining key factors influencing loyalty. PSQ, satisfaction,trust, and commitment were examined within a model that is assumed tobe comprehensive enough to explain loyalty. Two samples were used to per-form the following: the first sample was used in an exploratory study touncover the relationships; the second sample was used in a confirmatorystudy to validate the relationships. For a robust analysis, and because bothsamples work similarly, the study also examines the merged sample.

The results demonstrate that commitment is the most influential factor—mainly because of its direct and strong relationship to loyalty. The otherfactors have only indirect effects on loyalty and direct relationships in thefollowing sequence: PSQ to satisfaction, satisfaction to trust, and trust tocommitment, as hypothesized and corroborated. In many ways, theseresults resemble those reported by Henning-Thurau, Langer, and Hansen(2001), but differ significantly from those reported by Alves and Raposo(2007) and Helgesen and Nesset (2007) who, contrary to our assertion, foundthat the influence of satisfaction is directly reflected in the formation ofloyalty.

Among the factors that define service quality, the competence of theteaching faculty and the staff are paramount. In other words, PSQ in aneducational context is highly dependent on employees’ performance duringservice transactions. Similar to the SERVQUAL scale, where items dealingwith people interactions are dominant, in this study, most constructs reflectthe various interactions between students and university personnel, thusemphasizing the importance of the human touch in service relationships inhigher education institutions.


LIMITATIONS AND FUTURE RESEARCH

The influence of PSQ on the variables reflecting long-term relationships canbe reexamined with the purpose of better understanding such a role in thecontext of higher education institutions. The five constructs examined onbehalf of service quality may be expanded with additional constructs or dee-per exploration of the same constructs. The approach may strengthen notonly the overall relationships but also imbue the parameters of PSQ withgreater influence and=or meaning.

In addition, new research can explore service quality and student loyaltyin various other contexts linked to either careers or social groups. In suchnew contexts, such as students in technical careers or higher social classes,it is possible that the roles of secretaries or program directors are muchweaker compared with the role of instructors in the formation of PSQ. Simi-larly, it can be expected that the role of service attitude or competence devel-opment is weaker on larger campuses or in careers in liberal arts.Furthermore, the model can be applied to students after graduation in orderto know their long-term preferences and loyalties. Expansions—not justreplications—are needed to reach meaningful outcomes that contribute toa deeper comprehension of the important long-term relationship betweenstudents and education providers.

REFERENCES

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APPENDIX

Items Retained in the Final Model

Perceived Service Quality Student Relationship Management

Instructors Satisfaction

. Instructors’ empathy and attention tothe students (VAR9)

. Degree to which instructors serveas role models to students (VAR14)

. Instructor’s grasp of the subject (VAR18)

. Instructor’s friendliness towards students(VAR48)

. I am happy with the service I receivefrom the University (SAT12)

. My opinion about the University servicequality is favorable (SAT11)

. I am satisfied with what I receive as astudent (SAT4)

Program Director Trust

. Program Director’s readiness to listento student problems (VAR85)

. Extent to which the Director attemptsto solve student problems (VAR60)

. Fulfillment of Director’s commitmentsto solve student problems (VAR56)

. Director’s effectiveness in solvingstudent problems (VAR51)

. I am sure that the university staff werealways acting in my best interest (SAT2)

. Integrity is a word I’d use when describingthe university staff (SAT16)

. University staff always kept their promises tome (SAT20)

Secretaries Commitment

. Program secretary’s readiness to helpstudents (VAR16)

. Extent to which the secretary wants tosolve student problems (VAR25)

. Secretary’s readiness to answer studentquestions (VAR72)

. Secretary’s courteousness towardsstudents (VAR93)

. I felt very attached to my university (SAT3)

. I am proud to be able to study at myuniversity (SAT5)

. I am very happy to belong to this university(SAT10)

Service Attitude Loyalty

. Congruence between the serviceprovided to and the service requiredby the students (VAR78)

. If I were faced with the same choice again,I would still choose the same university(SAT15)

(Continued )


Appendix Continued

Perceived Service Quality Student Relationship Management

. Clear explanation to the students aboutthe various alternatives to their inquiries(VAR81)

. Timely notification to students regardingschedule changes and=or cancellations(VAR83)

. I’d recommend my university to someoneelse to prepare for a career (SAT7)

. I have no qualms about recommending thecareers offered by this university offers toprospective students (SAT21)

Competence Development

. Instructor’s ability to promote studentcreativity (VAR42)

. School’s fostering of leadership in students(VAR41)

. Infusion of a winner-mentality into thestudents’ minds (VAR39)


determinants of student loyalty in higher education: a...

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