Kelvin Levi Martawidjaja, Tengku Ezni Balqiah

FROM CSR TO SERVICE QUALITY: UNVEILING THE KEY DRIVERS OF CUSTOMER LOYALTY FOR INDONESIA'S FLAG CARRIER

Introduction

From csr to service quality: unveiling the key drivers of customer loyalty for indonesia's flag carrier. Uncover key drivers of customer loyalty for Indonesia's flag carrier. This study analyzes CSR & service quality's impact on corporate image & loyalty in the competitive airline industry.

Abstract

To stay ahead in the competitive airline industry, various efforts are made to maintain consumer loyalty amidst numerous airline options. Companies engage in Corporate Social Responsibility activities as a marketing strategy. These efforts support sustainability, enhance corporate image, and strengthen customer loyalty. However, relying solely on social activities is not enough to boost customer loyalty. In such a competitive aviation industry, airlines must also focus on business activities related to customers, influenced by service quality. This study examines the impact of CSR and service quality on corporate image and customer loyalty of airlines in Indonesia. Using a quantitative approach, questionnaires were distributed online to 319 respondents. Data was processed using SmartPLS software for hypothesis testing. Out of 16 hypotheses, 14 were accepted, indicating a stronger direct relationship between service quality towards corporate image and customer loyalty compared to CSR. Additionally, the mediating influence of corporate image was identified.

Review

This study tackles the critical challenge of customer loyalty within the highly competitive airline industry, focusing specifically on Indonesia's flag carrier. By exploring the interplay between Corporate Social Responsibility (CSR) initiatives and service quality in shaping corporate image and, ultimately, customer loyalty, the paper addresses a significant managerial and theoretical gap. The premise that a balanced approach, moving beyond mere social activities to encompass core business operations, is necessary for sustained loyalty is both intuitive and empirically valuable. The chosen context of a national flag carrier further grounds the research in a specific and relevant operational environment. Methodologically, the paper adopts a quantitative approach, leveraging a substantial online survey of 319 respondents. The use of SmartPLS for hypothesis testing indicates a rigorous statistical analysis capable of handling complex relationships, including mediation. A key strength of the findings is the clear articulation that 14 out of 16 hypotheses were accepted, providing strong empirical support for the proposed model. Crucially, the study identifies that service quality exerts a stronger direct influence on both corporate image and customer loyalty compared to CSR, while also confirming the significant mediating role of corporate image. These results offer actionable insights for airline management in prioritizing their strategic investments. While the abstract provides a compelling overview of the study's scope and key findings, a more detailed understanding of the specific dimensions of CSR and service quality investigated would further enrich its contribution. The finding that service quality holds a stronger direct relationship is impactful, but the nature and significance of the accepted CSR relationships, even if weaker, would still be relevant for a comprehensive strategic outlook. Future research could explore the boundary conditions under which CSR might gain more prominence, perhaps by segmenting customers based on their sustainability concerns, or by examining the long-term cumulative effects of CSR versus the more immediate impact of service quality.

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