Case Study: Role of Marketing Mix

Abstract

This study aims to investigate the effect of the marketing mix and service quality on tourist satisfaction and loyalty. The data collection techniques used in this study included interviews and questionnaires to the relevant parties. The technique of data analysis in this study was descriptive and Structural Equation Modeling (SEM). The results showed that the marketing mix had a positive and significant effect on tourist's satisfaction. The service quality had a positive and significant effect on tourist's satisfaction in the region of Samosir. Marketing mix had a positive and significant effect on tourist's loyalty. The service quality had a positive and significant effect on tourist's loyalty. Tourist satisfaction had a positive and significant effect on tourist's loyalty in the region of Samosir. And the marketing mix and the service quality had a significant effect on tourists in the Samosir Region through tourist satisfaction. 

It also revealed that employees of lower age and longer experience are preferable because of shorter operating times and that the age was statistically significant, revealing that the most appropriate age to have a shorter time is approximately 27 years.

Keywords: Marketing Mix, Service Quality, Satisfaction, Loyalty, Tourists

Source: Muhammad Elfi Azhar, Jufrizen Jufrizen, Muhammad Andi Prayogi, Maya Sari, https://www.researchgate.net/publication/336192910_The_role_of_marketing_mix_and_service_quality_on_tourist_satisfaction_and_loyalty_at_Samosir
This work is licensed under a Creative Commons Attribution 3.0 License.

1. Introduction

Samosir is one of the largest lakes in the world, and the largest and most popular in Indonesia. Samosir is located in North Sumatra area which is one of the valuable assets in the State/Local Government and is one of the important tourist destinations after Bali and Lombok, so it is a pride for the region. The establishment of Samosir as one of the tourist destinations is due to the beautiful natural panorama. 

However, Samosir tourism activities are currently not experiencing developments, and with a decrease in the number of visitors, tourism facilities are starting to be neglected. In the Samosir tourism area, there are not only Samosir tourism object but also 4 other tourism objects, namely Batu Gantung, Kera Huta Sibatu Loting Tourism Park, Bangun Dolok and camping ground and also Dolok Simarbalatuk. These objects are in fact if developed properly can provide more value in Parapat tourism area, but the current conditions of these objects are almost unknown to the public. 

To manage the tourism industry properly and professionally, an in-depth study is needed, including tourists as the source of income that must be served well to keep them happy and comfortable so that the residence time within the tours area will be longer. The tourism industry is a type of product which is mostly engaged in the service, for all aspects related to the economic orientation are services. 

The dynamics that occur in the tourism services sector can be seen from the development of various industries such as banking, insurance, telecommunications, and others. Marketing services intended to build expectations of tourists and make a promise to the tourist. 

The company strives to meet the expectations and promises to tourists so that tourists are satisfied. Consumer satisfaction is the level of one's feelings after comparing performance (results) with expectation. Tourists experience various levels of satisfaction or dissatisfaction after experiencing each service in accordance with the extent that consumer expectations are met or exceeded. 

This is because satisfaction is the emotional state, the post-purchase reaction of tourists can be anger, dissatisfaction, irritation, neutrality, joy, or pleasure. Tourists who are angry or dissatisfied could cause problems because they can be moved to another company and spread the negative word of mouth. 

Many factors can affect tourist loyalty, including the marketing mix and service quality. It is supported by some research results of Azhar and Jufrizen, and Gultom, Setiawan and Sayuti, Tefera, and Govender stating that the service quality and marketing mix has a positive and significant effect on tourist loyalty. 

This study was made aiming to replicate the study, because of the marketing mix and service quality affects tourist satisfaction and loyalty. So the purpose of this study is divided into six sub-goals: 

f) To Investigate the Mediation Role of Tourist Satisfaction on the Effect of Marketing Mix and Service Quality on Tourist Loyalty. 

2. Literature Review

2.1. Loyalty

Loyalty is the willingness of tourists to continue purchasing from a company over a long period of time and use the product or service repeatedly, as well as recommend it to friends and other companies. According to Griffin, consumer loyalty is a concept of loyalty that leads more to behavior than attitude, and a loyal consumer will show a purchase behavior which is defined as a regular purchaser and shown over time by some decision-making units. Loyalty is an important concept in marketing because loyalty is one of the factors able to determine the market share of a company. 

Consumer loyalty is a behavioral drive to make purchases repeatedly and to build consumer loyalty to a product/service that is produced by a company that takes a long time through a repetitive purchasing process. 

Loyalty does not only mean the existence of consumer wishes to buy back the same brand in later time, but also the consumer having a psychological commitment or attitude towards the brand. And the loyal tourists are not only buying the brand but also refusing to switch to other brands, even when other brands offer something more than the brands they use. 

Loyal consumers are not sensitive to price, deliver positive recommendations regarding the brand, and are willing to spend more money on the brand-producing company. Loyalty can also refer to the preference of tourists to purchase a particular brand of a product category. This occurs because tourists feel that a brand is able to offer the product features, product image, or product quality level which matches the price. Basically, the first time tourists will experiment in the purchase of a product, after they try the product and feel satisfied, they will make it a habit and will continue to purchase the same product because they feel the product is more secure and known. 

2.2. Consumer Satisfaction

Johnson and Fornell stated that consumer satisfaction is the result of a thorough evaluation of the top performing consumer products which they consume. Yi identified two different concepts of customer satisfaction, namely transaction-specific satisfaction and overall satisfaction. Transaction-specific satisfaction is a concept that refers to the assessment of customer satisfaction after purchasing particular products or brands. 

While overall satisfaction is a concept that measures the satisfaction (dissatisfaction) of tourists towards particular products or brands as a whole based on the entire experience in consuming these products or brands. Thus overall satisfaction could be viewed as a function of all transaction-specific satisfaction that occurred before. The concept of customer satisfaction that this study uses is overall customer satisfaction. By knowing the measurement results in consumer satisfaction, the company can prepare strategies that will be implemented in order to create consumer loyalty. 

Consumer satisfaction, according to Kotler and Armstrong, is the level of consumer feelings that the consumer perceives after comparing performance (or results) to their expectations. According to Hasan, consumer satisfaction is a feeling of the consumer in response to products or services that have been consumed. In general, satisfaction can be defined as a comparison between results or services received and consumer expectations. The results received must be at least  equal with consumer expectations, or even exceed them. 

Kotler revealed that satisfaction is a feeling of like or dislike that someone has for a product after he/she compared the product's performance with his/her expectations. Simamora argues that customer satisfaction is the result of experience in the product. This is a consumer's feeling after comparing expectations (prepurchase expectation) to actual performance.

2.3. Marketing Mix

Marketing mix is the set of controlled tactical marketing tools (products, prices, places, and promotions) that help the company to produce the desired response in the target markets. 

Daryanto (2013), the marketing mix is the tactical marketing tools that can be controlled and combined by the company to produce the desired response in the target markets. Marketing mix is the variables to be monitored by the company to satisfy the groups targeted. 

Marketing mix consists of a product, offered at a certain price, with some kind of promotion to tell prospective tourists about these products, and a way to reach consumers. Marketing mix consists of all the things that a company can do to influence the demand for its products. 

Effective marketing program combines all the elements of the marketing mix into an integrated marketing program designed to achieve the company's marketing goals by delivering value for tourists. Marketing mix is the company's tactical advice to determine a strong positioning in the target markets (Kotler; Armstrong, 2009). 

2.4. Service Quality

Service quality is the evaluation of tourists' long-term observationsin the service delivery of a company. The definition of service quality is the magnitude of the difference between expectations or desires of tourists with their level perception. 

According to Kotler and Keller, service quality is a statement about the attitude towards the comparison between expectations and performances. Meanwhile, according to Lovelock, et al, service quality is something that consistently meet or exceed consumer expectations. 

Also according to Ratnasari and Aksa, service quality is how far the difference between reality and consumer expectations for services received/retrieved. While the Yamit stated that in general, service quality can be seen from the comparison between consumer expectations and service performances. 

The best service to customers and the level of quality can be achieved consistently by improving services and paying special attention to good service standard performance both in internal service standard or external service standard. Before the consumer buys a service, tourists have expectations about the service quality that is based on personal needs, experiences, word of mouth recommendations, and ad service providers. After buying and using these services, tourists compare the expected quality with what is truly received. 

3. Research Methods

The location of the study was carried out in the tourism destinations of Samosir Region, North Sumatra, located in seven districts, namely Simalungun Regency, Toba Samosir Regency, Samosir Regency, North Tapanuli Regency, Humbang Hasundutan Regency, Karo Regency, and Dairi Regency. The population in this study were all tourists who visited the Samosir Region. 

The sample used non probability sampling, allowing the opportunity for someone to be a respondent was not known. Sampling of tourists in this study was determined by quota sampling as many as 200 respondents either male or female. In this study, the sampling technique was accidental sampling, which was how to obtain samples based on tourists who were found when conducting the study, which was taken from the research site without distinguishing the origin of the tourists. 

Data collection techniques used in this study include interviews and questionnaires to the relevant parties. In its implementation, researchers get respondents by visiting respondents one by one, then asking their willingness to become respondents in this study. After the respondents agree, the authors interview respondents one by one based on the prepared questionnaire. 

The interview was carried out in the morning until noon when the visitors arrived. Before the questionnaire was distributed, validity and reliability tests were carried out first. The technique of data analysis in this study is descriptive and Structural Equation Modeling (SEM).

4. Results

4.1. Structural Model Analysis

After calculating and analyzing the Confirmatory Factor Analysis (CFA), the latent score can be measured for each latent variable. Analysis of the structural model includes several things, namely: 

Overall Model Match Test 

Table 1: Goodness of Fit Structural Equation Model (SEM) 

In table 1 above we can see the GFI value of 0.84 and AGFI of 0.80 and SRMR of 0.073, which fall into the marginal fit category. The value of RMSEA, NFI, and RFI NNFI, IFI, and CFI, all fall into the good fit category. So it can be concluded that the overall fit of the model is already good.

4.2. Causal Relationships Analysis

After analyzing the result of goodness of fit research model, the next step is to do an analysis of the causal relationships in the model. Statistical testing for causal relationships of structural model is made with a significance level of 5% so that critical value from t-value is ± 1.96. The estimation results of all causal relationships of the study can be seen in the results.

The following LISREL 8.80 output:

4.3. Hypothesis Testing

As explained in the previous chapter, there are 5 hypotheses in this study. Hypothesis testing analysis is carried out with a significance level of 5%, resulting in a critical t-value of ± 1.96. The hypothesis is accepted if the t-value obtained ≥ 1.96, while hypothesis is not supported if the t-value obtained < 1.96. The following is a table of hypothesis testing to answer the overall questions of the study:

Table 2: Hypothesis Testing of Research Model Based on table 2 above which contains the conclusion of the hypothesis model results, it can be concluded as follows:

a) Marketing Mix has a positive effect on Tourist Satisfactions

 Based on data processing results of the structural model, the output of t-value is 3.78. The result of t-value shown is greater than 1.96, so it can be concluded that the variable of marketing mix has a significant positive effect on tourist satisfactions. Thus, hypothesis 1 can be accepted and it can be concluded that the higher marketing mix perceived, the higher tourist satisfactions will be.

b) Service Quality has a positive effect on Tourist Satisfactions

Based on data processing results of the structural model, the output of t-value is 5.94. The result of t-value shown is greater than 1.96, so it can be concluded that the variable of service quality has a significant positive effect on tourist satisfactions. Thus, it can be concluded that the higher service quality perceived, the higher tourist satisfactions will be.

c) Marketing Mix has a positive effect on Tourists Loyalty

Based on data processing results of the structural model, the output of t-value is 4.19. The result of t-value shown is greater than 1.96, so it can be concluded that the variable of marketing mix has a significant positive effect on tourists loyalty. Thus, it can be concluded that the higher marketing mix perceived, the higher tourist loyalty will be.

d) Service Quality has a positive effect on Tourists Loyalty

 Based on data processing results of the structural model, the output of t-value is 3.23. The result of t-value shown is greater than 1.96, so it can be concluded that the variable of service quality has a significant positive effect on tourists loyalty. Thus, it can be concluded that the higher the perceived service quality, the higher tourist loyalty will be.

e) Satisfactions has a positive effect on Tourists Loyalty

 Based on data processing results of the structural model, the output of t-value is 3.16. The result of t-value shown is greater than 1.96, so it can be concluded that the variable of satisfactions has a significant positive effect on tourists loyalty. Thus, it can be concluded that with higher perceived satisfaction comes higher tourist loyalty.

Hypothesis Testing Of Mediation (Indirect Effects) 

 As explained in the previous chapter, in this study there are two moderation hypotheses by Tourist Satisfaction variables. Hypothesis testing analysis is carried out with a significance level of 5%, resulting in a critical t-value of ± 1.96. The hypothesis is accepted if the t-value obtained ≥ 1.96, while hypothesis is not supported if the t-value obtained < 1.96. 

  The following is a table of testing hypotheses to answer indirect influences. 

Table 3. Testing of Indirect Influence Hypotheses 

Based on the results of the LISREL output above, the data from the structural model, obtained the output of t-value (line 3), in the result showed that the variables of tourists satisfaction can mediate the effect between the variable of marketing mix and service quality that has an indirect effect on tourists loyalty. This can be seen from t-count value is greater than 1.96 i.e. 2.50 and 3.00.

5. Discussion

Based on the results of factor analysis, presented in the previous chapter, the variables which affect tourist loyalty to Samosir are marketing mix, service quality, and tourist satisfactions. The following are the linkages between variables, namely: 

a) Marketing Mix Effects on Tourist Satisfactions 

The results of the study showed that marketing mix has a positive and significant effect on tourist satisfactions in Samosir Region. The results of this study indicate that good implementation of marketing mix will increase tourist satisfaction. Conversely, weak implementation of marketing mix results in tourist dissatisfaction. 

According to Oliver, loyalty is the commitment of customers to stay in depth to re-subscribe or re-purchase selected products or services consistently in the future, even though the influence of the situation and marketing efforts has the potential to cause behavior change. Empirically, the findings of this study supporting the study that was conducted by Rasyid et al., Teviana et al., Ismail et al., and Gultom which showed that marketing mix had an effect on tourist satisfactions. Meanwhile, the results of the study by Al Muala and Al Qurneh concluded that products had a significant effect on tourist satisfactions, while prices, people, and processes had no significant effect on tourist satisfactions. The results of the study by Megatef concluded that all elements of the marketing mix had a very strong effect on tourist satisfactions. 

b) Service Quality Effects on Tourist Satisfactions 

The results of the study showed that service quality has a positive and significant effect on tourist satisfactions in Samosir Region. The results of this study indicate that a better implementation of service quality will increase tourist satisfaction. Conversely, with weak implementation of service quality results in tourist dissatisfaction. 

A successful marketing program can be seen from its ability to satisfy the wants and needs of consumers. The combination of marketing mix elements was created to be able to meet customer satisfaction together. Previous research shows a variety of findings where not all marketing mix elements always affect satisfaction. 

Empirically, the findings of this study support the study that was conducted by Rasyid et al., concluded that service quality had a significant effect on tourist satisfaction. The results of this study also reinforce the results of previous study conducted by Setiawan and Sayuti, Adinegara et al., Tefera & Govender who concluded that service quality had an effect on tourist satisfactions. 

c) Marketing Mix Effects on Tourists Loyalty 

Based on the results of the study, marketing mix has a positive and significant effect on tourists loyalty in Samosir Region. The results of this study indicate that a better implementation of marketing mix will increase tourist loyalty. Conversely, if the weak implementation of marketing mix, the tourists will be not loyal. Griffin stated his opinion about consumer loyalty is a concept of loyalty more towards behavior (behavior) compared to attitude (attitude) and a loyal consumer will show purchasing behavior that is defined as regular buyers and shown all the time by several decision-making units. 

Empirically, the findings of this study support the study that was conducted by Azhar and Jufrizen, and Gultom who concluded that marketing mix had an effect on tourist loyalty. Meanwhile, the results of the study by Al Muala and Al Qurneh concluded that products had a significant effect on tourist loyalty, while prices, people, and processes had no significant effect on tourists loyalty. Esmaili et al. who concluded that prices, physical evidence, and distribution had an effect on tourist loyalty. 

d) Service Quality Effects on Tourists Loyalty 

The results of the study showed that service quality has a positive and significant effect on tourist loyalty in Samosir Region. The results of this study means that if the better implementation of service quality, it will increase tourists loyalty. Conversely, if service quality is weak, tourists will be not loyal. 

This research is in line with research conducted by Mohammed: that many organizations have realized that maintaining excellence depends on obtaining customer loyalty, because service quality is the material needed to convince customers to choose an organization over others. 

Achieving a high level of quality service provided is the importance of loyal customers. Providing high-quality services is considered the most effective way to ensure the superiority of hospitality services over its competitors by maintaining customer loyalty. The results of this study reinforce the results of previous study conducted by Setiawan and Sayuti, Azhar and Jufrizen, Tefera and Govender who concluded that service quality had an effect on tourists loyalty. 

e) Satisfaction Effects on Tourist Loyalty  

The results of the study showed that satisfaction had a positive and significant effect on tourist loyalty in Samosir Region. The results of this study means that if the better implementation of satisfactions, it will increase tourists loyalty. Conversely, satisfaction being weakly implemented will lead to tourists not being loyal. Bowen and Chen state that customer satisfaction is closely related to customer loyalty, where satisfied customers will become loyal customers. 

Loyal customers are a powerful marketing force for the company, providing recommendations and positive information to other prospective customers. The results of this study reinforce the results of previous study conducted by Setiawan and Sayuti, Teviana et al., Azhar and Jufrizen, Mohamad et al., Tefera and Govender, Suwunniponth and Gultom who concluded that tourist satisfactions had an effect on tourists loyalty. 

• The Mediation Role of Tourist Satisfaction on the Effect of Marketing Mix and Service Quality on Tourist Loyalty. Based on the testing of mediation variables, it is evident that the tourist satisfaction variable acts as an intervening variable for the effect of exogenous variables on the marketing mix and service quality on tourist loyalty. The test results show that to increase tourist loyalty, the determining factor is tourist satisfaction, service quality and marketing mix. Loyal consumers are consumers who have a behavior that supports a company, have a commitment to buy back the company's products or services and recommend products or services to other parties so that it can be said to be an extraordinary marketing tool for the company. They can provide recommendations and spread word-of-mouth that are positive about the company, can increase sales by buying other products from the company and will buy these products more often and only require a smaller cost to satisfy them because they already know the product and require less information about the product. This is in accordance with the results of research conducted by Azhar and Jufrizen, and Gultom, Al Muala and Al Qurneh, Setiawan and Sayuti, Tefera and Govender, Teviana et al., Mohamad et al., and Suwunniponth. 

6. Conclusion

Based on data analysis and discussion, it can be concluded as follows: 

Marketing mix had a positive and significant effect on tourist satisfaction in the Samosir Region. Thus, the better the implementation of marketing mix, the more tourist satisfaction will increase. Similarly, service quality also had a positive and significant effect on tourist satisfaction in the region. Thus, the better service quality is perceived by tourists, the better tourist satisfaction will be.

In addition to tourist satisfaction, marketing mix had a positive and significant effect on tourist loyalty in the Samosir Region. Thus, with the better implementation of marketing mix, tourists loyalty will increase. Similarly, service quality had a positive and significant effect on tourist loyalty in Samosir Region. Thus, with better service quality perceived by tourists, tourist loyalty will be higher. 

Tourist satisfaction had a positive and significant effect on tourist loyalty in Samosir Region. Thus, the higher the satisfaction perceived by tourists, the greater their loyalty will be. Marketing mix and service quality had a significant effect on tourists loyalty in Samosir Region through tourist satisfaction. 

7. Suggestions

It was suggested to the tourism agents in Samosir Region to continue to maintain tourist satisfaction because it could provide benefits, including reducing marketing costs, transaction costs, and customer turnover costs. It can also increase cross selling so that the customer share becomes greater, with increased positive word of mouth reporting.

It is suggested to the related institutions to improve service in the form of providing adequate public facilities, thus increasing tourist loyalty as well as increasing the total number of visitors. The next indicator could be expanded, especially related to the marketing mix variables and service quality, so it would better fit in the concept used.