Analysis on Influencing Factors Toward Customer Loyalty

ANALYSIS ON INFLUENCING FACTORS TOWARD CUSTOMER LOYALTY

(A CASE STUDY OF APPLE PRODUCTS)

Syarifah Ade Mutia ID no. 014201000009

A Skripsi presented to the Faculty of Business President University in partial fulfillment of the requirements for Bachelor Degree in Economics Major of Management

January 2014 SKRIPSI ADVISER RECOMMENDATION LETTER

This skripsi entitled “ANALYSIS ON INFLUENCING FACTORS TOWARD CUSTOMER LOYALTY (A CASE STUDY OF APPLE PRODUCTS)” prepared and submitted by Syarifah Ade Mutia in partial fulfillment of the requirements for the degree of bachelor in the Faculty of Business has been reviewed and found to have satisfied the requirements for a skripsi fit to be examined. I therefore recommend this skripsi for Oral Defense.

Cikarang, Indonesia, January 27, 2014

Acknowledged by, Recommended by,

Vinsensius Jajat K., MBA Vinsensius Jajat K., MBA Head of Management Study Program Skripsi Adviser

DECLARATION OF ORIGINALITY

I declare that this skripsi, entitled “ANALYSIS ON INFLUENCING FACTORS TOWARD CUSTOMER LOYALTY (A CASE STUDY OF APPLE PRODUCTS)” is, to the best of my knowledge and beliefs, an original piece of work that has not been submitted, either in a whole or in a part, to another university to obtain a degree.

Cikarang, Indonesia, January 27, 2014

SYARIFAH ADE MUTIA

PANEL OF EXAMINERS APPROVAL SHEET

The Panel of Examiners declares that the skripsi entitled “ANALYSIS ON INFLUENCING FACTORS TOWARD CUSTOMER LOYALTY (A CASE STUDY OF APPLE PRODUCTS)” that was submitted by Syarifah Ade Mutia majoring in Management from the Faculty of Business was assessed and approved to have passed the Oral Examinations on February 19, 2014.

Dra. Genoveva, M.M. Chair – Panel of Examiners

T. Manivasugen, MBA Examiner 1

V. Jajat Kristanto, MBA Examiner 2

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ABSTRACT

This research is focusing on assessing the influencing factors of several independent variables such as Marketing Mix elements (4P), Brand Image, and Customer Satisfaction toward Customer Loyalty as the dependent variable, limited to Indonesia online based community of Apple users. The data collected were from 98 respondents using Slovin formula, and simple random sampling method was used in the distribution of questionnaire, and is in Likert-scale type. Quantitative analysis including validity and reliability test, classic assumption test, and multiple regression were conducted in this research to test the appropriate hypothesis through T-test, F-test, and Coefficient Determination (R square). Results of the analysis found that from the six factors, price, product, place, promotion, brand image, and customer satisfaction, there are three variables that were proven have negative significant influence toward customer loyalty. The other three variables were proven has positive influence, such as price as the most influential variable, also customer satisfaction, and brand image did influence customer loyalty. Furthermore, the F-test has shown that the independent variables together have significant correlation to dependent variable, supported by R square value which accounted for 75.7% of how much the dependent variable can be explained by the independent variables.

Keywords: Marketing Mix, Brand Image, Customer Satisfaction, Customer Loyalty

ACKNOWLEDGEMENT

“The Originator of the heavens and the earth. When He decrees a matter, He only says to it: “Be!_and it is.” (QS 2:117)

First of all, the researcher would like to praises Allah SWT for all the never end blessings, and guidence for all the process of finishing this thesis. And the opportunity of this given time to finally met the ending of this university life.

Through this opportunity, the researcher would like to express her gratitude to the following imperative persons which have been very valuable to the researcher’s life and journey:

1) The very first to mention is the researcher parent and family, the all time love, the father in earth and heaven, Said Rachmatna, and a lovely mother Yayah Puntiawati, for all the prayers, the wonderful caring, and the supportive actions that always strengthen the researcher when she was at her lowest. And for the greatest family of the researcher’s own, the twins Syarifah Rahmi Azizi and Syarifah Nurul Azizi that the researcher cared the most. Also a brother and his family, Said Tiar Purnama and Devi Linda Kartini, and the source of smile and laugh, the researcher’s niece and nephew, Cut Adja Sabrina, and Said Nazmi Azka. No other words can describe how thankful she is for having a great family like them. 2) The researcher would also like to express the grateful feelings and apreciation over the completion of this thesis to all those who already gave cooperation, support, guidance, and encouragement that make the completion of this skripsi achieved. Mr. Orlando R. Santos, MBA, Mr.Vinsensius Jajat K., MM, MBA. Not to mention the words of thank you very much also given for the honorable examiners Mam Genoveva, MM, and Mam Filda Rahmiati.

3) The researcher’s appreciation for all the best colleges for over three and a half year, Lauransia Oktaviany, Dwini Rahmadina, Fabiola Nola, Grece Situmorang, Lystia, Edwin Cinwang Rinaldy, Mohammad Syarif, Noni Trisnawati, Joudy Marsya, Sherly Silvia, Kevin Adisya, Nurinda Febrianty, Ervina Anggraini, Andi Fuad, Fathia Fatima, Ayu Agustafany, Hardian Ruben, Trecy Emerald, Alfina Maharani, Ikhwan Farabi, Audy Theo, Rahman Kurniawan, Putri Utami Vallen, Dian Amarta, Martina Pradita, and all International Business and President University associates, the expressed feeling cannot be described more as how much the researcher would thank to all the memories, hope the friendships will last till the end. 4) The next is to the best given companion that have accompanied in the most time before, for almost ten years and still counting, the researcher’s best friend, the gratitude feelings of how much the researcher valued them for who they are, for acceptance, and the devotion are to be presented for the best of the best, to Soraya Verina, Meinartika Putri, Hany Syafira, Puteri Kartika, Yeniar Hendra Ningrum, Enggar Pradipta, Astrid Nurul Pratiwi, Nia Risnawati, and Fellycia Meylanda. 5) Last but not least, many thanks sent to Dafni Renata, a best friend, a brother,and a lover.For his great support, through the good and bad, the smile in the sad, and a doctor wannabe. Can’t thank him enough for the great days spent together, and most of them were thank you for the devotion, the patience, and the understanding. The last one is, happy birthday for him, February 12, 22 years ago, was born the researcher’s best companion, and these words are to express the feelings “If I had a flower whenever I thought of you, I could walk on a garden forever”.

TABLE OF CONTENTS

THESIS ADVISER RECOMMENDATION LETTER ...... i DECLARATION OF ORIGINALITY ...... ii PANEL OF EXAMINERS ...... iii APPROVAL SHEET ...... iii ABSTRACT ...... iv ACKNOWLEDGEMENT ...... v Table of Contents ...... vii List of Tables ...... xi List of Figures ...... xiii CHAPTER I ...... 1 I. INTRODUCTION ...... 1 1.1 Research Background ...... 2 1.2 Problem identification ...... 6 1.3 Statement of problem ...... 7 1.4 Research Objectives ...... 7 1.5 Research Limitation ...... 8 1.6 Definition of Terms ...... 9 1.7 Significance of the Study ...... 10 CHAPTER II ...... 11 II. REVIEW OF LITERATURE ...... 11 2.1 Marketing Mix ...... 11 2.1.1 Price ...... 12 2.1.2 Product ...... 13 2.1.3 Promotion ...... 13 2.1.4 Place/Distribution ...... 14 2.1.5 Correlation between Marketing Mix and Customer Loyalty ...... 15 2.2 Brand Image or Market Positioning ...... 15 2.2.1 Correlation between Brand Image/Market Positioning with Customer Loyalty ...... 18 2.3 Customer Satisfaction ...... 18

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2.3.1 Correlation between customer satisfaction and customer loyalty ...... 19 2.4 Customer Loyalty ...... 20 2.5 Previous Research ...... 23 2.6 Theoritical Framework ...... 25 2.7 Hypothesis ...... 26 CHAPTER III ...... 27 III. RESEARCH METHODOLOGY ...... 27 3.1 Research Method ...... 27 3.2 Operational Definitions ...... 29 3.3 Research Framework ...... 32 3.4 Sampling Design ...... 34 3.4.1 Sample Size ...... 34 3.5 Research Instrument ...... 35 3.5.1 Data Collection ...... 36 3.6 Reliability and Validity ...... 37 3.6.1 Validity Testing ...... 37 3.6.2 Reliability Test...... 37 3.7 Classic Assumption Test ...... 38 3.7.1 Normality Test ...... 38 3.7.2 Autocorrelation Test ...... 39 3.7.3 Multi-collinearity ...... 39 3.7.4 Heteroscadisticity Test...... 39 3.8 Multiple Regression Analysis ...... 40 3.8.1 Correlation Coefficient ( R ) ...... 40 3.8.2 Coefficient Determination ...... 41

3.8.3 F-test ...... 푹ퟐ ...... 41 3.8.4 t-test ...... 41 3.9 Data Analysis ...... 43 CHAPTER IV ...... 44 IV. ANALYSIS AND INTERPRETATION ...... 44 4.1 Company Profile ...... 44

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4.1.1 History ...... 45 4.1.2 Products ...... 46 4.1.2.1 iPhone ...... 46 4.1.2.2 iPad ...... 46 4.1.2.3 Mac ...... 46 4.1.2.4 iPod ...... 47 4.1.2.5 iTunes ...... 47 4.1.2.6 Mac App Store ...... 48 4.1.2.7 iCloud ...... 48 4.1.2.8 Software Products and Operating System Software ...... 48 4.1.1.9 Application Software ...... 49 4.1.1.10 Other Application Software ...... 49 4.1.3 Apple SWOT Analysis ...... 50 4.2 Data Analysis ...... 51 4.2.1 Respondent Demography ...... 51 4.3 Descriptive Analysis ...... 57 4.3.1 Descriptive Analysis of Price ...... 57 4.3.2 Descriptive Analysis of Product ...... 58 4.3.3 Descriptive Analysis of Place ...... 59 4.3.4 Descriptive Analysis of Promotion ...... 60 4.3.5 Descriptive Analysis of Brand Ima\\\ge ...... 61 4.3.6 Descriptive Analysis of Customer Satisfaction ...... 62 4.3.7 Descriptive Analysis of Customer Loyalty...... 63 4.4 Validity and Reliability Test ...... 64 4.4.1 Validity Test ...... 64 4.4.2 Reliability Test...... 67 4.4.3 Classical Assumption Test ...... 70 4.4.3.1 Normality Test ...... 70 4.4.3.2 Multi-collinearity Test ...... 72 4.3.3.3 Heteroscedasticity Test ...... 73 4.4.3.4 Autocorrelation Test ...... 73

4.4.4 Multiple Linear Regression ...... 74 4.4.4.1 Regression Model ...... 74 4.4.4.2 Correlation Coefficient (R) and Coefficient Determination ( ) ...... 75

4.4.4.3 F Test ...... 퐑ퟐ ...... 76 Table 4.28: Anova ...... 76 4.4.4.4 t Test ...... 78 4.5 Interpretation of Result ...... 81 CHAPTER V ...... 84 IV. CONCLUSION AND RECOMMENDATION ...... 84 5.1 Conclusion ...... 84 5.2 Recommendation ...... 89 REFERENCES ...... 90 APPENDICES ...... 93

LIST OF TABLES

Table 1.1: Apple financial report 3

Table 2.1: Loyalty Dimensions 22

Table 3.1: Operational Definition Table 30

Table 3.2: Cronbach Alpha Interval 39

Table 3.3: Correlation Coefficient Interval 41

Table 4.1: SWOT Analysis 51

Table 4.2: Descriptive Analysis of Price ( ) 58

Table 4.3: Descriptive Analysis of Product푿 (ퟏ ) 59

Table 4.4: Descriptive Analysis of Place ( 푿) ퟐ 60

Table 4.5: Descriptive Analysis of Promotion푿ퟑ ( ) 61

Table 4.6: Descriptive Analysis of Brand Image푿 (ퟒ ) 62

Table 4.7: Descriptive Analysis of Customer Satisfaction푿ퟓ ( ) 63

Table 4.8: Descriptive Analysis of Customer Loyalty ( ) 푿 ퟔ 64

Table 4.9: Validity Result of Price 풀ퟏ 65

Table 4.10: Validity Result of Product 66

Table 4.11: Validity Result of Place 66

Table 4.12: Validity Result of Promotion 66

Table 4.13: Validity Result of Brand Image 67

Table 4.14: Validity Result of Customer Satisfaction 67

Table 4.15: Validity Result of Customer Loyalty 67

Table 4.16: Cronbach Alpha of Price 68

Table 4.17: Cronbach Alpha of Product 68

Table 4.18: Cronbach Alpha of Place 69

Table 4.19: Cronbach Alpha of Promotion 69

Table 4.20: Cronbach Alpha of Brand Image 69

Table 4.21: Cronbach Alpha of Customer Satisfaction 70

Table 4.22: Cronbach Alpha of Customer Loyalty 70

Table 4.23: Kolmogrov-Smirnof Test 72

Table 4.24: Multi-collinearity Test 73

Table 4.25: Autocorrelation Test 74

Table 4.26: Coefficient Table for Equation 75

Table 4.27: Analysis of R Value 77

Table 4.28: Anova 77

Table 4.29: t Test value 79

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LIST OF FIGURES

Figure 1.1: Smartphone Market Share 3

Figure 1.2: Operating System 2010-2013 4

Figure 2.1: Possible value proposition 16

Figure 2.2: Theoritical Framework 25

Figure 3.1: Research Framework 34

Figure 4.1: Gender Demography 52

Figure 4.2: Age Demography 53

Figure 4.3: Occupation Demography 54

Figure 4.4: Income Demography 55

Figure 4.5: Varieties of Products 56

Figure 4.6: Years of Using 57

Figure 4.7: Descriptive Analysis of Price ( ) 58

Figure 4.8: Descriptive Analysis of Product푿 (ퟏ ) 59

Figure 4.9: Descriptive Analysis of Place ( 푿) ퟐ 60

Figure 4.10: Descriptive Analysis of Promotion푿ퟑ ( ) 61

Figure 4.11: Descriptive Analysis of Brand Image푿 (ퟒ ) 62

Figure 4.12: Descriptive Analysis of Customer Satisfaction푿ퟓ ( ) 63

Figure 4.13: Descriptive Analysis of Customer Loyalty ( ) 푿ퟔ 64

Figure 4.14: P-P Plot 풀ퟏ 71

Figure 4.15: Histogram 72

Figure 4.16: Heteroscedasticity Test 74

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CHAPTER I

I. INTRODUCTION After the death of Apple co-founder which is Steve Jobs, have made the shareholders of its company worried about the business run by this company, not to mention the declining market share of this company, also the less innovations given to its customers. Yet, the high demand of several varieties of Apple products disclosed the high level of loyalty from its customer.

As the time goes by, with so many choices offered by gadget producer, it now become a complicated process that needs a deep knowledge of the product technology itself, involving the knowledge of brand image, available features, price setting, package plans and many more. But with a little priming, anybody can do a smart decision on choosing their final option of device. This is why company needs to keep their customer attract with their product and maintain a good quality and service until loyalty is one big factor that bound customer and the company.

Customer loyalty nowadays is one of important aspect to the business growth, since discussed by Reichheld (1999) that the advantages of customer loyalty to the service provider, in terms of continuous profit, reducing marketing cost, increasing per-customer revenue growth and referrals. Thus, such as maintaining customer loyalty would give advantages to the company, company should have a high concern on their customer satisfaction to better learn the customer perception toward their product, and in the end will lead to the loyalty a customer feel about the products. Thus, the researcher wants to conduct the ANALYSIS OF INFLUENCING FACTORS TOWARD CUSTOMER LOYALTY (A CASE STUDY OF APPLE PRODUCTS).

1.1 Research Background Based on well developed innovations, there are a lot of changes and futuristic features that being offered by mobile technology provider, one of the world’s best technology producer was Apple Inc. and is a great manufacturer of not only mobile device, but also other entertainment device and a so called Macintosh that can help ease the working life sector. Steven Jobs had created masterpieces as his legacy by providing innovations in many aspects of digital tools produced by this company and lately has become the pioneer of the device expansion.

The idea of innovations given in Apple new products was a great idea, until competitors stop pretending everything is fine, and started to duplicate and rebuild the products, just like Ipad phenomenon. Ipad was a very first tablet that created in a minimize computer functions into a lighter, flat, and square device, its first generation was released on April 2010, and were dominating market share at that time, for selling 3 million iPad during the first 80 days. Due to the Apple success with the technology, the other company can see this as an opportunity if they can create their products as an alternative.

Indeed after Ipad was released, not so long after it, there were so many products that also implement the same physical characteristics with Ipad, added with some innovations, also cheaper materials that make competitors can produce cheaper similar products such as Samsung, Asus, Acer, Toshiba, Motorola and so forth. Thus, this factor has lead middle-lowered customers to choose some other brands beside Apple products. Not to mention, the death of the co-founder, since then Apple has not produced another significant innovations to its products.

And it has been proven as being reported by CNBC on Friday, November 15, 2013, Gartner said that Samsung, which is Apple’s competitor managed to sell 80.357 units of smart phones worldwide during July until September 2013. Meanwhile, Apple only sold 30.330 handsets of theirs. Samsung is one of the strongest competitors for Apple. And from last year’s period for Samsung share in the smart phone market remained unchanged at 32.1 percent, meanwhile, Apple’s market share fell to 12.1 percent from 14.3 percent. As the few years

2 before, Apple keep experienced the falling amount of market share as cited by IDC data, the previous share of Apple have fallen from 18.8% to 16.9% disclosed by the table below,

Figure 1.1: Smartphone market share

Source: IDC data

Furthermore, table below shows Apple annual financial report reported by marketwatch website.

Table 1.1: Apple financial report

Source: www.marketwatch.com

The table 1.2 above disclose the downturn ratio of gross income in financial year of 2012 to 2013, despite the rising of revenue amount, Apple should worry about the decreasing of its gross income, according to Carasco (2010), gross income is how much the company makes before taxes, this is an important amount when analyzing a company, this amount is a company’s revenue minus cost of goods sold, this indicating of how efficient a company is in managing labor and supplies in the production process.

Furthermore, until the investors are worries about the company’s prosperity even though the sales and revenue of its products especially iPhones are rising, but still the earnings are decreasing, as its market value down by 25 percent or about $160 billion in 2013 as cited by Jakarta Post magazine October, 2013. The below table also show the indicated Operating System (OS) as determinant of Apple market share compare to other Operating System (OS).

Figure 1.2: Operating System 2010-2013

Source: Statcounter.com

Despite the plunged of iOS user in the worldwide, indicated from the downturn from 25.48% to 22.29% on 2011, and being beaten by several Operating System (OS) like Android, Samsung, and Series 40. However, the increasing percentage in the end of 2011 does not taking back its highest position in early 2011. As Strategy Analytics Paul Brown said that by creating a powerful brand image, along with a compelling user experience, Apple has managed to create a high level of brand loyalty amongst existing users, bizjournal cited. Apple is still the world’s most valuable company, despite the downturn and a tight competition, Apple is in a good market positioning, and has a strong loyalty of its customer.

For instance, as cited by BGR.com (2013), despite the Android tablets have led Apple in market share and Windows based tablets will likely to take off at some point, Apple do not need to worry and again was showing that the company care much less in maintaining the market share than the company do in maintaining high margins in profit. The company instead rise the price to generates its revenue as IHS researcher Rhoda Alexander explained that hardware profit plays a big role in Apple’s success, enabling the design, durability and performance innovations that in turn support Apple’s premium pricing, while other brands using price cuts as their powerful marketing tool.

In the era of developed technology, and a tight competition in technology market, measuring and maintaining customer loyalty is a solution to keep collecting earnings. As the average business loses 10-30 percent of its customer each year, but they often don’t know which customer they have lost, when they were lost, why they were lost, or how much sales revenue and profit this customer decay has cost them (Nigel Hill, Handbook of customer satisfaction and loyalty measurement 1996).

By the loosing of customer, as has been shown by several research, that decreasing the retention rate by only a few percentages can have a major impact on the level of profitability of a company (Reichheld and Sasser 1990). Because the costs of recruiting new customers are said to be higher than the costs of retaining customer old customers, and research has found positive relationship

5 between customer loyalty and the organization’s profitability (Christina Nordman 2004). Reducing marketing costs, is definitely one of the benefit of having a loyal customer (Evans and Laskin 1994; Mittal and Lassar 1998), because there would be tendencies of a loyal customer to be demanding less time in personal selling, to be less price sensitive, to spread positive word-of-mouth (e.g. Reichheld and Sasser 1990; Reichheld 1996; Narayandas 1998), these benefits are a company treasure that have to be kept in good maintenance.

1.2 Problem identification

Apple has experiencing the downturn since the death of its co-founder Steve Jobs two years ago. Fortunately, the co-founder has set the image to its product as premium brand which made them different with another brands. A company which can differentiate its product to provide superior value to customers through the lines of product, services, personnel, location or image (Kotler et al 2006) is a set of act in designing meaningful differences to distinguish the company’s offering from competitior’s offerings (Kotler 1997, 282), through this differentiation and brand image, customers may acknowledge a difference even when competing offers look the same (Armstrong, Kotler, Harker Brennan 2009).

In the end, the aim of this research is to analyze which factor of 4Ps of marketing mix elements is the most dominant, also brand image, and customer satisfaction are the variables to be determined in defining the loyalty of Apple customers, since the main problem is occurwhen competing with the other brands but lack of innovations has made to the products after the death of Steve jobs, Apple co- founder and innovators.

1.3 Statement of problem

Thus, the research questions of this study are:

a. Is there partial significant influence of the “price” variable towards customer loyalty? b. Is there partial significant influence of the “product” variable towards customer loyalty? c. Is there partial significant influence of the “place” variable towards customer loyalty? d. Is there partial significant influence of the “promotion” variable towards customer loyalty? e. Is there partial significant influence of the “brand image/market positioning” variable towards customer loyalty? f. Is there partial significant influence of the “customer satisfaction” variable with customer loyalty? g. Are there simultan significant influence of “price, product, place, promotion, brand image, and customer satisfaction” toward customer loyalty?

1.4 Research Objectives In order to overcome the issue caused by lacking innovations that Apple had given to its customer after the death of co-founder and the most initiator of innovations, that can impact to company’s profit and earnings, also the needs to analyze the factors of several elements in determining the loyalty of Apple customers, the researcher intend to implement the selected dimensions of marketing mix as the tools to better know the dominant factors of what makes people are loyal to Apple products.

Thus, the objectives of this research are:

a. To find out partial significant influence of price towards customer loyalty b. To find out partial significant influence of product towards customer loyalty c. To find out partial significant influence of place towards customer loyalty d. To find out partial significant influence of promotion towards customer loyalty e. To find out partial significant influence of brand image/market positioning towards customer loyalty f. To find out partial significant influence of customer satisfaction towards customer loyalty g. To find out significant influence of price, product, place, promotion, brand image, and customer satisfaction toward customer loyalty

1.5 Research Limitation This study is focused on Apple user who’s also a member of Indonesia Apple user which divided to several online based communities (via facebook) such as Indonesia-Mac community, Indonesia-iPad community, Indonesia-iPhone and iPod community. The particular questionnaires are distributed to 98 members of Indonesia Apple user community in Indonesia based on their perceptions while using Apple products. This study will analyze the impact of customer satisfaction towards customer loyalty.

1.6 Definition of Terms a. Brand image a positioning strategy to gain customers trust (Armstrong, Kotler, Harker and Brennan, 2009) b. Customer loyalty is positive attitudes of a customer towards brand and company c. Customer satisfaction is how customer compares a perceived of performance of a product and their expectations, customer will get satisfied if the perceived performance is better than their expectation (Kotler and Armstrong, 2010) d. Id-mac is a community consisting of Indonesian Macintosh users. e. Id-ipad is a community consisting of Indonesian iPad users. f. Id-iphone is a community consisting of Indonesia iPhone and iPod users. g. Marketing mix is the set of controllable tactical marketing tools such- product, price, place, and promotion that the firm blends to produce the response it wants in the target market (Kotler 2005). h. Place / distribution defined as any way that the customer can obtain a product or receive a service (Jones, 2007) i. Price is the amount of money that people pay in order to get service or product (Kotler et al. 2008). j. Product is everything that companies provide for its customer and target market, it can mean a physical object which customer can see and touch or it can mean service, ideas, and almost anything (Groonroos, 2005). k. Promotion explained that promotion is concerned with any vehicle you employ for getting people to know more about your product or service (Jones, 2007).

1.7 Significance of the Study The importance of this research can give knowledge, information, and suggestion for particular parties as follows:

a. Customer: To provide review of existing user of their satisfaction level, and loyalty attitudes toward the brand. b. Apple: The findings of this research could become reference for Apple in order to strengthen its factors of marketing mix, also to improve its brand image and higher its customer satisfaction based on the differences of life style and culture in Indonesia. c. Researcher: To find out the significance influence of marketing mix aspects and brand image of Apple products, and the correlation between Apple customer satisfaction impact towards its customer loyalty. d. Future Researcher: The findings of this research could become a reference to expand the knowledge and information of future researcher who would do research about Marketing Mix, Brand Image, Customer Satisfaction, and Customer Loyalty. e. The University: To add more reference and literature studies in the field of Marketing Mix, Brand Image, Customer Satisfaction, and Customer Loyalty.

CHAPTER II

II. REVIEW OF LITERATURE

2.1 Marketing Mix Chai Lee Goi (2009) explained in his journal of marketing studies that the marketing mix term used is first claimed by Borden (1965) and was suggested by Culliton’s (1984) as “mixer of ingredients” is an executive who sometimes follows a recipe as he goes along, sometimes adapts a recipe to the ingredients immediately available, and sometimes experiments with or invents ingredients no one else has tried.

Borden’s (1965) original marketing mix had a set of 12 elements such as product planning, pricing, branding, channels of distribution, personal selling, advertising, promotions, packaging, display, servicing, physical handling and fact finding and analysis. In the other hand, Frey (1961) suggests that marketing variables should be divided into two parts, the offering part which is product, packaging, brand, price and service, the other one is methods and tools which is distribution channels, personal selling, advertising, sales promotion and publicity.

McCarthy (1964) defined the marketing mix as a combination of all of the factors at a marketing manager’s command to satisfy the target market. Later, he separated Borden’s 12 elements to four elements or 4ps, namely product, price, promotion and place and place, since then, 4P generally known as marketing mix management paradigm that has dominated marketing. But then there were many researchers proposed new Ps and elements into marketing mix because they think the 4P cannot deliver a high degree of satisfaction, and numerous critics has come from the service marketing area (Rafiq and Ahmed, 1995), later Booms and Bitner (1981) support that 7P should replace the 4P framework as the generic marketing mix, added three extra elements include people, process and physical

11 evidence which is good because its more comprehensive but also more complicated than 4P.

And nowadays, the 4P still remains the most common marketing mix, despite its limitations and its simplicity, the use of this framework remains strong and is somehow become fundamental in the marketing mix (kent and Brown, 2006). Due to its useful when physical products represented a larger portion in economy (Chee Lee Goi, 2009) while 7P is more detailed and can also be used in relationship and service marketing (Eeva Rajakallio, 2012).

The main reasons why marketing mix is a powerful concept that makes marketing seem easy to handle, allows the separation of marketing from other activities of the firm and delegation of marketing tasks to specialists, and the components of marketing mix can change a firm’s competitive position said Gronroos (1994), Chee Lee Goi (2009) cited.

2.1.1 Price Price is the amount money that customer pays in order to get product or service. Customer pays some certain amount of money and as an exchange gets different benefits, pricing is also a psychological issue, due to many people measures price with the quality of the product (Kotler et al. 2008). Kotler et al (2008) added to also notice that there are two kinds of costs which is variable costs and fixed cost.

Zeithmal (1998) and Kotler et al (2008) describe that price is the view that monetary cost is one of the factors that influence consumer’s perception of a product’s value, it can be started as the actual or rated value of a valuable product which is up for exchange or as amount of money paid for product.

According to Jones (2007) the price you set for products or services plays a large role in its marketability. Pricing for products or services that are commonly available in the market is more elastic, meaning that unit sales will go up or down more responsively in response to price changes.

Kotler et al (2008) in Eeva Rajakallio (2012) previous research had divides segmented pricing into four categories. Customer-segment pricing means different prices for different customers. For example, the amusement park tariff is different in the segmented age, the cheaper tariff for children rather than adult. Product-form pricing is that different forms of certain product have different prices, taken pineapple and canned pineapple as an example, which basically, these are the same products but are different in pricing. Location pricing determines if the company wants for example charge higher fees from non US- citizens than from US-citizens. Time pricing is usual form, for example food seller which will lower their food at the end of the day to avoid loss.

2.1.2 Product Product is everything that companies provide for its customer and target market, it can mean a physical object which customer can see and touch or it can mean service, ideas, and almost anything (Groonroos, 2005). Customers are not buying only the certain product but there comes so much more with it. Product can be divided into three different levels which each of them increases the value of product (Kotler et al. 2008). The first level is core product which is the real product bought by customer. Next, is the supplementary materials include within the product such as packaging, brand, and quality. The last level is additional product including delivery, credit, warranties, and after sales.

2.1.3 Promotion Jones (2007) explained that promotion is concerned with any vehicle you employ for getting people to know more about your product or service. Advertising public relations, point-of-scale displays, and word-of-mouth promotion are all traditional ways for promoting a product. Promotion can be seen as a way of closing the information gap between would-be sellers and would-be buyers.

Promotion is a part of specific effort to encourage customers to tell others about their services, promotion have become a critical factor in the product marketing

13 mix which consists of the specific blend of advertising, personal selling, sales promotion, public relations and direct marketing tools that the company uses to pursue its advertising and marketing objective cited by Owomoyela, Olasunkanmi and Oyeniyi (2013). (Zeithaml et al. 1995; Kotler 2007).

Promotion means everything companies do in order to sell their products and services and how they tell about their products to the customers (Eeva Rajjakalio, 2012). The promotion mix which includes different tools which company uses in their business, these tools are advertising, sales promotion, public relations, personal selling and direct marketing tools. There are used in order to improve customer value and in order to maintain customer relationship. Promotion also defined as the tools which used to build the company’s image and difference from competitiors (Kotler et al, 2008; Khrisna, 2010).

2.1.4 Place/Distribution Place as any way that the customer can obtain a product or receive a service as defined by Jones (2007). Distribution also considered as another name for place, it encompasses all decisions and tools which relate to making products and services available to customers, and claimed that place could be categorized into open market, merchant houses, institutional houses, and direct delivery (Bowersox and closs, 1996)

Traditionally, a market was a physical place where buyers and sellers are gathered to exchange goods. Now, marketers view the sellers as the industry and the buyers as the market. (Kotler, 2002)

But recently, location is not so vital anymore for every companies, it depends on the type of the company. Internet now has made everything easier. Although place is an important aspect to think in business but more vital is the availability and accessibility (Eeva Rajakallio, 2012; Krhisna, Gopala Raghavan, and Reddy, 2010). Products need to be available for the customers and accessibility needs to be simple. Selling can be direct selling at the place via sales people but it may

14 happen via catalogues, telephone, or trade fairs and many uses combination of different selling tactics (Tracy, 2004).

2.1.5 Correlation between Marketing Mix and Customer Loyalty Mellens, Dekimpe, and Steenkamp (1996) concluded that brand loyalty can be quantified using the brand-specific intercepts in market share attraction models (Cooper and Nakanishi, 1988). In those models a brand’s market share is determined by its relative attractiveness vis-à-vis the other brands. This attractiveness itself is determined by the (1) value and effectiveness of its marketing mix variables and (2) a constant, which is assumed to reflect the brand’s loyalty.

Cengiz and Yayla (2007) find marketing mix to have positive effect on satisfaction and loyalty on word of mouth. Especially, product and promotion components have the important influence on word of mouth communication indirectly.

2.2 Brand Image or Market Positioning Brand image or market positioning nowadays have become a powerful strategy to gain customers trust, as being described before by Armstrong, Kotler, Harker and Brennan (2009) that through a company or brand image differentiation, customers may acknowledge a difference even when competing offers look the same. A lot of advantages became an easy target to catch if this strategy implemented on track. According to Barwise (1993); Farquhar et al (1991); Keller (1993); Simon and Sullivan (1993); and Smith and Park (1992); may indicate the probability of brand choice, willingness to pay premium prices, marketing communication effectiveness, and brand licensing opportunities, and decreases vulnerability to competitive marketing actions and elastic responses to price increases, were the advantages may be achieved by maintaining brand image as cited by Boonghee Yoo, Naveen Donthu and Sungho Lee (2000)

As the co-founder has set the positioning of Apple products nicely, a strong brand image has been created by the innovators. When the company understands brand personality and image, they have the tools to successfully differentiate their brand (Jung et al 2010). Yang (2010) also say that brand personality ultimately affiliates with the brand by product attributes, brand name, category associations, advertisements, price, symbol or logo, and distribution channel. The brand personality of the characterization of the brand is mainly what the firm communicates to the public. Strategy is based on a differentiated customer value proposition. Satisfying customers is the source of sustainable value creation. Strategy requires a clear articulation of targeted customer segments and the value proposition to please them. Clarify of this value proposition is the single most important dimension of strategy (Kaplan and Norton 2004).

Since each company must decide and develop its own winning positioning strategy, one that makes it appealing and special to its target customers (Armstrong et al. 2009), there are five winning value propositions: less for much less, same for less, more for less, more for same, and more for more.

Figure 2.1: Possible value proposition

Source: Pham Truy Trang, 2012

The above figure shows the five winning value propositions. “Less for much less” positioning means that a product offers less will costs less (Pham Truy Trang, 2012), this positioning is caused by the variety of economic levels of the market segments shows by a population, since not everyone can afford the best of a product offered, that with less price, the customer still can purchase the good but with less benefits.

Second positioning is “Same for less”, the company provides the same products with lower price (Pham Truy Trang, 2012), while “More for less” is a condition where a company can provides the best products and service with the lowest price (Pham Truy Trang, 2012) but this condition may become a suicide decision to the company, as when they promises the give best product benefits to offered to the market, they also need to invest more on their products, but the low prices may find it to be hard to cover the cost and can lead to bankruptcy.

“More for the same” positioning of offering a brand with comparable high quality brand but at a lower price (Pham Truy Trang, 2012), a little bit different with “More for more” positioning that needs to be applied by a company which offers the most premium product or service and charge a higher price to cover the highest costs (Pham Truy Trang, 2012).

Not to mention what Apple did this whole time, setting its brand in this “More for more” position, Apple is a premium brand that demands and earns a price premium, this premium spans the entire Apple product line up encompassing the Macintosh, iPod, iPhone, etc. Apple’s positioning is aligned with targeting a less price sensitive customer. As a result, Apple’s culture and internal activities are structured to meet the needs of these customers. Strategists call this needs-based positioning. Apple has thus created a culture and a set of activities of differentiate itself from rivals in order to meet the needs of their target customers as cited in understanding Apple’s positioning-a premium brand at a premium price article by Switch to a Mac (2009).

2.2.1 Correlation between Brand Image/Market Positioning with Customer Loyalty Heng, Yeong, Siong, Shi and Kuan (2011) had concluded that there is a strong perception of both corporate reputation and image would tend to increase the degree of customer loyalty, also the trust and satisfaction that that interwoven tightly with the traditional constructs such as image could substantially contribute to loyalty (Nguyen and Leblanc, 2001; Orth and Green, 2009).

Also, Izquierdo et al, (2005) explained that the process of developing customer- firm relationships starts when the firm invests in activities directed towards attracting customers and positioning on the market. However, a greater effort is needs in order to make these customers loyal. Attraction and loyalty programs that are necessary in the process of creating customers-firm relationships that are valuable both to customers and the firm. Kotler (2002) also presents many strategies to offer a product in the market, known as product branding strategies, manufacturer brand is a product branding that sells under the name of the producer that have benefits of customer loyalty and price premium. In his book, Kotler (2000) he explained that manufacturers have learnt that market power comes from building their own brands, and in case the companies can no longer afford to manufacture their products in their homeland, strong brand names continue to command customer loyalty.

2.3 Customer Satisfaction Customer satisfaction depends on how customer compares a perceived of performance of a product and their expectations, customer will get satisfied if the perceived performance is better than their expectation. Customers who get satisfied will purchase repeatedly and would like to share their good experience to other people (Kotler and Armstrong, 2010).

Kotler (2002) also defined buyer’s satisfaction with a purchase is a function of the closeness between the buyer’s expectation and the product’s perceived performance. If performance falls short of expectations, the customer is disappointed, but if it meets expectations, the customer is satisfied.

Customer satisfaction is a fundamental thing towards the growth and expansion of a business as it leads to an increase in market share, and to acquiring repeat and referral business, which ultimately results in greater profitability (Barsky, 1992). Therefore, achieving customer satisfaction is crucial to business, as being described by Getty and Thompsons (1994) that the relationships between quality, satisfaction and the subsequent effect on customers; intention to recommend the product to other potential customers. Their results suggest that customer’s perceptions of both satisfaction and quality greatly impact the customers’ intention to recommend (which is a measure of customer loyalty) (Martina Donelly, 2009).

2.3.1 Correlation between customer satisfaction and customer loyalty Donelly (2009) summarized that, due to the importance correlation between customer satisfaction and customer loyalty, customer satisfaction had given a considerable attention since it is assumed to be a significant determinant of repeat sales, positive word-of-mouth and customer loyalty (Cronin et al., 2000; Cronin and taylor, 1992; Oliver 1980; Bearden and Teel 1983). Several studies by Bowen and Che (2001); Oliva et al., (1992) and Coyne (1989) also proved that a minimal change in the level of satisfaction can lead to a significant change in loyalty growth.

Gremler and Gwinner (2000) had shown a positive relationship between overall satisfaction and loyalty intention. Hu Beibei, Wang Shiyang and Xu Jiahong (2013) cited that customer satisfaction is believed to have a significant positive correlation with customer loyalty (Colgate and Stewart, 1998; Bitner and Gremler, 2006).

Previously, Fornell (1992) and Jones (1990) found that loyal customers are not necessarily satisfied customers, but satisfied customers tend to be loyal customers. Highly satisfied customers are much more loyal than satisfied customers and any drop in total satisfaction results in a major drop in loyalty as cited by Rasha Ali Eliwa (2006).

Donelly (2009) also concluded that there is a positive relationship between customer satisfaction, quality, and customer loyalty based on the research done by Getty and Thompson mentioned before of how the relationships between those variables will result to recommend the product to other potential customers which is a measurement factor of loyalty. Mattsson (2009) also conclude that most of the companies make a huge mistake. When they do not paying enough attention to their customer satisfaction. Keeping customer satisfied is the best competitive advantage against competitors.

2.4 Customer Loyalty Martina Donelly (2009) explained that building customer loyalty leads to positive outcomes such as augmented sales, a reduction in costs, more foreseeable profit flows, increased competitive advantage, and is critical to a firm’s survival and growth. This consistent with customer relationship management (CRM) theory which argues that a firm’s overriding strategy should be the attraction and retention of profitable customers, because loyal customers will, in the long-term, buy more and pay a premium for doing business with those they trust and like (Terrill et al., 2000; Otrowsky et al., 1993; Bharadwaj et al., 1993; Reichheld, 1996; Peppers and Rogers, 2004).

Loyalty was investigated in terms of brand loyalty with respect to tangible good (Day, 1969; Tucker, 1964; Cunningham, 1956). Brand loyalty defined as the number of purchases a household allocated to a brand over a period of time (Cunningham, 1956). And because of the conceptualization and measurement of the loyalty concept has become more and more complex, thus the vast majority of market researchers view loyalty as a multi-dimensional concept, however there is

20 debate as to how many dimensions (Jones and Taylor, 2007; Martina Donelly 2009). Willingness to recommend is the only indicator utilized by Reichheld (2003) from investigating service organization in measuring customer loyalty, while Chitty, Ward and Chua (2001) explained that customer loyalty can be conceptualized by three dimensions, behavioral loyalty, indicated by repeat- purchase behavior, and attitudinal behavior, referring to the inherent affective and cognitive facets of loyalty.

The behavioral approach involves the individual altering their behavior, showing strong intentions to repurchase from one service provider over alternative service providers. Both the marketing and psychological literatures indicate that behavioral loyalty is measured by re-purchasing intentions, switching intentions, and exclusively purchasing intentions (Jones and Taylor, 2007).

The attitudinal approach considers both emotional and psychological aspects in loyalty. For example, an individual may have positive attitude towards a product and may recommend about the product to others, but they may not have or buy the product because the product is too expensive for them, but still the positive attitude will benefit the company. Building attitudinal loyalty towards a product or service takes more than a basic marketing transaction inducement. Positive attitudes towards the product or service must be developed over a longer period of time (Kumar and Shah, 2004).

Furthermore, Lee and Cunningham (2001) added a cognitive approach which entails an individual completely reforming what she/he believes about the relationship with his/her service provider. Martina Donelly (2009) explained that the cognitive measures include top of mind, first choice, price tolerance, exclusive consideration, identification with the service provider, that is “my service provider”, and willingness to pay more (Dwyer et al., 1987; Ostrowsky et al., 1993; De Ruyter et al., 1998; Anderson 1996; Gremler and Brown, 1996; Butcher et al., 2001; Bloemer et al., 1999). The table below shows a full breakdown of the loyalty dimensions of behavioral, attitudinal, and cognitive.

Table 2.1: Loyalty Dimensions

Dimensions Loyalty Related Definition Related Research Outcome

Behavioral Repurchase Customer’s aim to maintain a Jones et al. (2000); Intention relationship with a particular service Zeithmal et al. (1996) provider and make his or her next purchase in the category from this service provider

Switching Customer’s aim to terminate a Bansal abd Taylor Intention relationship with a particular service (1999); Dabholkar and provider and patronize another in the Walls (1999) same category

Exclusive Customer’s aim to dedicate all of his Reynolds and Arnold Intention or her purchase in a category to a (2000); Reynolds and particular service provider Beatty (1999)

Attitudinal Relative Attitude The appraisal of the service, including Dick and Basu (1994); the strength of that appraisal and the Mattila (2001); Pritchard degree of differentiation from et al. (1996) alternatives

Willingness to Consumer’s willingness to Butcher et al. (2001); Recommend recommend a service provider to Zeithmal et al (1996) other consumers

Altruism Consumer willingness to assist the Price et al. (1995) service provider or other service consumers in the effective delivery of the service

Cognitive Willingness to Consumer’s indifference to price Anderson (1996); De pay more differences between that of his or her Ruyter et al (1998) current service provider and others in the same category

Exclusive The extent to which the consumer Dwyer et al (1987); Consideration considers the service provider as his Ostrowski et al. (1993) or her only choice when purchasing this type of service

Identification The sense of ownership over the Butcher et al. (2001) service affiliation with the service provider, or congruence values that exists between service provider and the consumer

Source: Martina Donelly (2009) adapted from Jones and Taylor (2007)

2.5 Previous Research There are several previous research has been conducted regarding to Marketing Mix, Customer Satisfaction, Brand Image, and Customer Loyalty, such as:

a. Based on the study done by Owomoyela, Olasunkami, and Oyeniyi (2013) about investigating the impact of marketing mix elements on consumer loyalty: an empirical study on Nigerian breweries PLC. The survey research design method used in this research which involves self-design questionnaire in collecting data from sixty respondent, six managers, and ten sales representatives of Nigerian breweries Plc, ten distributors and thirty four consumers from different joints in Ibadan were selected respectively. The instrument used in this research is a close-ended questionnaire that was designed by the researchers. Correlation coefficient and multiple regression analysis were used to analyze the data with the aid of statistical package for social sciences (SPSS) version 20. The result showed that marketing mix elements have significant effect on customer loyalty. Subsequently, recommendations were made to the management of Nigerian breweries that they should continue produce superior products; charge competitive prices, position appropriately, promote widely, and provide other distinctive functional benefits to consumers.

b. The second research done by Khoo Chong Heng, Kuit Sui Yeong, Lee Choon Siong, Tan Yi Shi, Yee Mei Kuan (2011) about Customers’ perceptions of the marketing mix and the effect on Malaysian Hypermarkets’ brand loyalty. Due to Malaysians hypermarket are increasing rapidly, therefore, brand loyalty has become a critical retailing topic. Meanwhile, plentiful studies are more concern on the effects of marketing mix towards brand equity instead of brand loyalty. By conducting this research study, the main goal is to identify which marketing mix will affect brand loyalty in Malaysian hypermarkets in relation to contribute hypermarkets’ management and future researchers in Malaysia. However, the researchers are adapting the studies done by Chen

(2007) in relation to its five independent variables (IVs) which are price, store image, advertising spending, distribution intensity, and price promotion as examining the relationship between five IVs and Malaysian hypermarkets’ brand loyalty. As such, researchers adapted it by reason of comparing the results between Malaysian and Taiwan hypermarkets. Furthermore, researchers will distribute 250 questionnaire surveys to customers in Malaysia hypermarkets. Lastly, this study is a descriptive and explanatory study by using descriptive and inferential analysis. c. The research by Rasha Ali Eliwa (2006) was a cross-secrtional descriptive research. The objective of the study was to examine how the image and customer satisfaction of a fine dining restaurant affects customers’ loyalty. the study also examined the two perquisites of customer loyalty which are customer satisfaction and the image of the fine dining restaurant. The study design employed two sets of variables: multiple criterion (dependent) variables and multiple predictor (independent) variables. Multiple regression analysis was used to predict the value of a dependent variable (e.g. ‘Overall Satisfaction’, ‘Likelihood of Return’, and ‘Likelihood of Recommendation’) from a linear function of a set of independent variables (e.g perceptions on restaurant customer satisfaction image-related attributes). A detailed questionnaire was distributed to customers who had lunch and dinner at a fine dining restaurant.

2.6 Theoritical Framework Figure 2.2: Theoritical Framework

Marketing Mix:

Price (X1)

Marketing Mix: Pr oduct (X2)

Marketing Mix:

P lace (X3) Partially Customer

Loyalty (Y1)

Marketing Mix: Promotion (X4)

Brand Image (X5)

Customer Satisfaction (X6)

Simultaneously

Source: constructed by researcher

2.7 Hypothesis ( )1: Price has negative partial significant influence towards customer loyalty

0 (퐻 )1: Price has positive partial significant influence towards customer loyalty

푎 (퐻 )2: Product has negative partial significant influence towards customer loyalty퐻0

( )2: Product has positive partial significant influence towards customer loyalty

푎 (퐻 )3: Place has negative partial significant influence towards customer loyalty

0 (퐻 )3: Place has positive partial significant influence towards customer loyalty

푎 (퐻 )4: Promotion has negative partial significant influence towards customer loyalty퐻0

( )4: Promotion has positive partial significant influence towards customer loyalty퐻푎

( )5: Brand image has negative partial significant influence towards customer loyalty퐻0

( )5: Brand image has positive partial significant influence towards customer loyalty퐻푎

( )6: Customer satisfaction has negative partial significant influence towards customer퐻0 loyalty

( )6: Customer satisfaction has positive partial significant influence towards customer퐻푎 loyalty

( )7: Price, Product, Place, Promotion, Brand Image, and Customer satisfaction simu퐻0 ltaneously have negative significant influence towards customer loyalty

( )7: Price, Product, Place, Promotion, Brand Image, and Customer satisfaction simu퐻푎 ltaneously have positive significant influence towards customer loyalty

CHAPTER III

III. RESEARCH METHODOLOGY

3.1 Research Method There are two types of methods used to do a research, which are qualitative and quantitative analysis, these methods refer to the way the researcher threats and analysis the collected data (Yin, 1994). As cited from Thesis Guidelines Quantitative by Ritchie and Lewis (2003); Royse (1999), qualitative research is an interpretative approach concerned with understanding the meanings of certain observed phenomena or action and finding explanations of reasons and associations by explaining, analyzing and interpreting observations. Furthermore, qualitative method can be defined as the interpretive techniques that seek to describe, decode, translate, and otherwise come to terms with the meaning, not the frequency, of certain phenomena as being described by Donald R.Cooper and Pamela S.Schindler (2006).

While quantitative research uses numbers to prove or disapprove a notion or hypothesis. It uses data that are structured in the form of numbers and provides fundamental connection between empirical observation and mathematical expression of quantitative relationship (Ross, 1999 as cited from Thesis Guidelines Quantitative). Quantitative research implies a search for knowledge that will measure, describe, and explain the phenomena of our reality and is often more formalized and well structured (Patel & Tebelius, 1987).

Quantitative research is analysed via basic statistics (means, percentages, and frequencies) and advance statistics (bivariate and multibivariate statistical techniques such as multiple regression, perceptual mapping, structural equation modeling, etc) (Strauss and Corbiin, 1990). Further, Saunders et al.,(1997) asserts that the results produced and techniques utilized are more precise and provide for greater analysis. Quantitative methods can be used to explain cause and effect

27 relationship while qualitative research involves in-depth analysis through asking how and why questions (Donelly, 2009). And hence, the researcher would like to conduct the quantitative research in order to measure, describe and explain the problem discussed in this research.

The descriptive research design is conducted in this research in order to describes the characteristics, functions, relationships and patterns of the research phenomena. Descriptive research is generally quantitative, more formal, very structured, produces hard data and uses larger samples (Malhotra, 1999). In the other hand, this study will obtain multiple regression analysis to predict the value of a variable based on the value of two or more variables where the variables to be predicted is called dependent variable, and the variable used to predict the value of dependent variable called independent variable according to statistics.laerd.com (2013).

3.2 Operational Definitions Table 3.1 Operational Definition Table

Variable Definition Indicator

Price (X1) 1. Price is the amount money 2. The price of Apple products is equal to its that customer pays in order quality to get product or service. 3. The Price of Apple products is premium Customer pays some certain price than other brands amount of money and as an 4. The discounted price of Apple products exchange gets different attract me more to buy benefits, pricing is also a 5. Despite the higher price changing, I would psychological issue, due to still prefer Apple among other brands many people measures price with the quality of the product (Kotler et al. 2008)

Product 1. Product is everything that 2. The Apple products I received is always in (X2) companies provide for its good condition customer and target market, 3. The Apple products is high quality it can mean a physical object 4. The Apple products has many varieties which customer can see and 5. Visual appearance of the products is touch or it can mean service, attractive ideas, and almost anything 6. I find that the Apple products has physically (Groonroos, 2005). strong 7. I find that Apple software is attractive (e.g iTunes, iCloud, Apple iOS) 8. I find that the Apple products quality meets my expectation

Place 1. Place as any way that the 2. The Apple store where I can buy the product (X3) customer can obtain a is near with my place product or receive a service 3. I can easily find the Apple store to buy the as defined by Jones (2007). products 4. The Apple store has an appealing décor 5. I can easily find public transportation to the Apple store 6. Easy layout of Apple store helps me find the needs I am looking for

Promotion 1.Jones (2007) explained that 1.The Apple Products is intensively advertised (X4) promotion is concerned with 2.The advertisements suit the brand image any vehicle you employ for 3.The advertisement is impressive and make getting people to know more me want to buy about your product or service 4.The Apple products has an attractive promotions for me (e.g. purchases with operator bundling such as telkomsel, xl, etc)

Brand 1.Brand image or market 1.I consider Apple as a strong brand Image positioning nowadays have 2.I can recognize Apple products among other (X5) become a powerful strategy to competing brands gain customers trust, that 3.I consider Apple as a premium brand through a company or brand 4.I can quickly recall the symbol or logo of image differentiation, Apple customers may acknowledge a 5.The Apple brand has a good reputation difference even when competing offers look the same. (Armstrong, Kotler, Harker and Brennan, 2009)

Customer Customer satisfaction depends 1.I am satisfied with my decision to choose Satisfactio on how customer compares a Apple product n (X6) perceived of performance of a 2.I am satisfied towards the quality of this product and their expectations, product (Kotler and Armstrong, 2010). 3.I am comfortable about the relationship with Apple 4.Out of other brands, Apple comes closest to my idea of an ideal products 5.Overall Apple products meet my needs/expectations

Customer 1. Brand loyalty defined as the 2. I consider myself to be loyal to Apple Loyalty number of purchases a because I feel satisfy (Y) household allocated to a 3. Apple would be my first choice brand over a period of time 4. Even if another brand has the same features (Cunningham, 1956). with Apple, I would prefer to buy Apple 5. I say positive things/experience about Apple products 6. I would recommend Apple products to those who seek my advice about such matters 7. I am willing to continue repurchase Apple products 8. I am willing to purchase other variety of Apple products

Source: Self Constructed by Researcher

3.3 Research Framework The topic chosen for this research is to investigate the factors that have influence to customer loyalty. Since customer loyalty is an important aspect that has to be maintained because of the positive attitudes of its customer that could give such advantages to the company, maintaining customer satisfaction is also needed because the higher level of satisfaction a customer feel, will make them tend to be loyal to the company.

This study investigates which factors that have significance influence of marketing mix, brand image toward customer satisfaction, and the correlation between Apple’s customer satisfaction and customer loyalty. To start conducting this research, the researcher begin by analyzing the occurrences happened after the death of Apple CEO-Steve Jobs, that in fact is the strongest innovators which has generates much innovations that resulted positively for the company.

The researcher analyzed several articles which discussing the financial statement of revenue, sales, and market share of Apple, limited to financial year of 2012- 2013 only. After identifying the problem that despite the lack of significance innovations which causes the declining in income and market share, Apple still acclaimed as company with a strong customer loyalty. The researcher wants to find out the factor that resulting to customer loyalty. Then the researcher continues to proceed to the theories needed from numerous sources such as journals and previous research to support the study. Literature and theory reviews are provided in chapter 2.

Furthermore, questionnaires were constructed and were checked for validity and reliability test. Person correlation matrix and cronbach alpha were used to measure the validity and reliability of this research. Pearson correlation matrix will indicate the direction, strength, and significance of the bivariate relationships among all the variables that were measured at an interval or ratio level, while Cronbach alpha is a reliability coefficient that shows how well the items in a set that are positively correlated to one another (Sekaran and Bougie, 2010). Then, around thirty (30) people were gathered to examine if the statements in

32 questionnaires were clear to understand and were having the same perception among the respondents. Finally, after the data were gathered from the questionnaire spreading to the respondents, the analysis was conducted by using SPSS. In the end, conclusion and recommendation were finalized for this research.

Figure 3.1: Research Framework

Background of study

Problem identification

Literature Review

Questionnaire construct No Validity and reliability test of questionnaire Yes

Data Collection

Data analysis

Conclusion and recommendation

Source: Constructed by the researcher

3.4 Sampling Design Due to this research will conduct a quantitative method, and needs to distribute a questionnaire in order to get the expected information, but since it is almost impossible to study the entire population of Apple user in Indonesia, because of the time and cost consuming, thus this research will only use samples as the way to collects the data. There are two main sampling techniques labeled as probability and non-probability sampling (Sekaran, 2000; Zikmund, 1996).

Probability sampling is a technique used in this research, where the samples are gathered in a process that gives all the samples in a population being studied equal chances of getting selected (Donelly, 2009). Simple random sampling would be conducted in this research, it is the simplest method, in which each person is chosen at random from the total population, so that there is an equal opportunity for selection (Fink and Kossef, 1998).

3.4.1 Sample Size The population selected in this research was about 98 samples, this amount is based on the limitation of respondents who are the member of Indonesian Apple Community which has the total of 4382 members.The community was chosen in order to better understand the significant factors that influence and causing the products user to be loyal, and because of the limitation of time and cost of the researcher, this online community was selected to ease the distribution of questionnaire.

Thus, probability sampling was the technique chosen to gather information and select certain amount mentioned above, and simple random sampling method was used in which each person in the population has a known and equal chance of being selected as subject of the research (Uma Sekaran and Roger Bougie, 2009).

Furthermore, to conduct the sampling size, this research will use Slovin formula (Glenn D. Israel, 2009)

= 1 + 푁 푛 2 Where: n = Number of Samples 푁푒

N = Number of Population

E = Margin of Error

Therefore:

4382 = 1 + 4382(0.1) 푛 2 = 97.7 98

푛 ≈

3.5 Research Instrument In quantitative research, there are four main tools associated with quantitative research such as surveys, observation, panels, and experimentation (Domegan and Fleming, 2007). Thus, the specific research instrument being conducted by the researcher is the data collection technique of descriptive research which is survey, because practical issues such as time and budgets also play a crucial role in the research design decision (Brannick, 2000), this survey consist of questions that later will be transformed into data and information as the result to be used for this research purpose.

Balnaves and Caputi (2001) “a survey is a method of collecting data from people about who they are (education, finances, etc.), how they think (motivations, beliefs, etc) and what they do (behavior)”. It is generally descriptive and quantitative in nature, and are a quick, relatively inexpensive, and accurate method to investigate a research phenomena (Zikmund, 1997), and are used to

35 collect a large number of responses (Creswell, 2003). Additionally, Domegan and Flemming (2007) stated that there are many modes in which to administer surveys such as telephone, face-to-face, mail, and electronically. So that, the researcher will spread the survey via electronic data like Google-docs.

The measurement using Likert scale to utilized. The scales provided respondents with a number of brief statements associated with measuring each category within the variable – likert-type scales measure the intensity of the feelings about an area in questions (Bryman, 2004), categories are arranged with scale position and respondents are expected to select the category that best describe their feelings toward the variable being measured (Malhotra and Birks, 2000). The scale of Likert using 5 points scale, where 1 = strongly disagree, 2 = disagree, 3 = neutral, 4 = agree, 5 = strongly agree.

3.5.1 Data Collection A valid, and accurate data are needed to be produced in order to have a reliable research, thus, the researcher needs to do a proper data collection by using questionnaire as primary data and secondary data.

Primary data is described as “data that has been generated by an individual or organization for specific problem at hand”, (Chrisnall, 1997), this is the first hand information originated by the researcher (Malhotra and Birks, 1999). This requires the gathering and assembly of specific information to the area of research in relation to the research objectives. While secondary data defined as “data that is developed for some purpose other than helping to solve the problem at hand” (Tull and Hawkins, 1993). It is a data that collected from readily available sources (Sekaran, 1992). Secondary data was utilized initially in order to obtain a greater understanding of the research are, to define the research problem and to develop the research approach (Donelly, 2009). Secondary data may collected by any source of information such as academic journals, electronic databases, academic research and books, etc.

Thus, in this research, secondary data was used at the beginning of the research before conducting the primary data collection which is questionnaires. The sources include academic journals, online articles, and electronic databases.

3.6 Reliability and Validity

3.6.1 Validity Testing Validity test is used to measure the instruments of research whether it is valid or not, also to measure how much is it the validity of each instrument. (Sekaran and Bougie, 2009).

The researcher used Product Moment Correlation – Pearson Correlation (Sherri Jackson, 2011). The result of this test can be indicated by comparing the r value with r table. The r table got from defining α as significance level. Then, by indicating the r value, if the r value is greater than the r table, the statement of variables can be assumed as valid statement, but if the r value is less than r table, then the particular statement can be assumed as invalid.

Determining the r table value was generated by determining df value by the following equation df = (n-2), where n = sample size. In this research, the researcher conducting a sample size of 98, with significance level of 10%, then 0.306 is the r table value.

3.6.2 Reliability Test The Reliability test of a measure indicates the extent to which it is without bias (error free) and hence ensures consistent measurement across the time and across the various items in the instrument. In other words, the reliability of a measure is an indication of the stability and consistency with which the instruments measures the concept and helps to assess the goodness of measure (Sekaran, Bougie, 2010).

The measurement of reliability test in this research will use the Cronbach Alpha Coefficient

Table 3.2: Cronbach Alpha Interval

Cronbach's alpha Internal consistency 0.81 – 1 Very Reliable 0.61 - 0.8 Reliable 0.41 - 0.6 Moderate Realiable 0.21 - 0.4 Less Reliable 0.00 - 0.2 Not Reliable

Source:(Arikunto, 2010)

3.7 Classic Assumption Test

3.7.1 Normality Test There are three methods conducted in this research in order to test the distribution in regression model are distributed normally or abnormally. The instruments to be tested are the independent and dependent variables. This test only given to 5 until 30 respondents at maximum, and the researcher was testing to 30 respondents.

A good regression model can be determined by three models such P-P Plot, Histogram, and for accuracy matter is Kolmogorov-Smirnov Test. Each test should be showing a normal attitude, for instance, P-P Plot is assumed as normal if the dots are close to the diagonal line, while Histogram graphic will assume as normal if there is the similarity of both negative and positive side, by looking at the bars ending. The last one is Kolmogorov-Smirnov test will assume as normal if the value in Asymp Sig. (2-tailed) is greater than 0.05, then the hypothesis of variable being tested accepted, and vice versa.

3.7.2 Autocorrelation Test Autocorrelation test was tested to determine if the independent is happened to have correlation between variables at a given period and the previous period (Ashari and Santosa (2005). It is better to not having autocorrelation in the research, and the value of Durbin-Watson should be in between -2 and 2 to assume there is no autocorrelation exists.

3.7.3 Multi-collinearity The existence of multi-collinearity was considered as bad factor for research variables, because it may lead the modelers to false dropping the important variable from the model because of its low t value. A good regression model should not have multi-collinearity and cannot be correlated between each of variables, thus Ghozali (2007) stated that the variables are not orthogonal.

To determine the test, it may be seen from the VIF (Value Inflation Factor) value. If the VIF are more than 10 (VIF>10), it can be assume that there is multi- collinearity, and vice versa.

3.7.4 Heteroscadisticity Test This test is conducted to see the specific variance differences between several observations in a regression model. Heteroscadisticity can be defined of a situation where the variance of residuals model changes over time or across cross- sectional units which violates the constant variance assumption (Wang and Jain, 2003), while a good regression model shall have the opposite characteristic.

Thus, the condition to determine whether heteroscadisticity or homoscedasticity are as follow:

1) If the plots forming a certain and clear pattern, it may be assumed that there is heteroscadisticity. 2) If the plots are scattered odd and are not forming a clear pattern, then it may be assumed it is homoscedasticity which is good.

3.8 Multiple Regression Analysis Mulitple Regression analysis provides an equation that predicts dependent variable from several independent variables (Kunal and Garav, 2011). The equation in this research was taken from Carver and Nach (2011), and will use the Unstandardized Coefficient Table. The equation is as follow:

Y = + + + + + + + where, 훂 Y =풃 ퟏCustomer푿ퟏ 풃ퟐ 푿Loyaltyퟐ 풃 ퟑ푿ퟑ 풃ퟒ푿ퟒ 풃ퟓ푿ퟓ 풃ퟔ푿ퟔ 풆 , , , , , = Coefficient

푏1 =푏 2constant푏3 푏4 푏or5 푏intercept6 α = Price 푋1= Product 푋2= Place 푋3= Promotion 푋4= Brand Image 푋5= Customer Satisfaction 푋e 6= random error

3.8.1 Correlation Coefficient ( R ) The Pearson Correlation Coefficient is a test to measure the strength and the direction of a linear between two variables. The scale of correlation coefficient is usually between 0.00 and 1.00 (0.00 >a> 1.00). Below is the table interval of the coefficient: Table 3.3: Correlation Coefficient Interval

Cronbach's alpha Internal consistency 0.80 – 1 Very strong 0.60 - 0.799 Strong 0.40 - 0.599 Average 0.20 - 0.399 Weak 0.00 - 0.199 Very Weak

Source: Stephanie, 2009

3.8.2 Coefficient Determination( ) ퟐ Ashari and Santosa (2005) explained푹 that this test is used to find the greater change or variance of variable which can be explained by the change or variance of other variable. The level of contribution a dependent variable towards independent variable is computed in percentage. The value of ( )is between 0 ퟐ and 1. Usually, the good condition of ( ) is the condition where푹 the value of ퟐ adjusted ( )are close to 1, meaning that푹 the independent variables have high ퟐ influence 푹toward dependent variable, and vice versa. The ( ) will be ퟐ represented in percentage. 푹

3.8.3F-test The F-test conducted to determine the condition of independent variables simultaneously affecting to dependent variable at the same time. The findings of this test will help the researcher to whether reject or accept the hypothesis (Nachrowi and Usman, 2004). This aimed to test the influence of all independent variables simultaneously. The determining the F-test, there will be two conditions to decide. If Sig. < 0.1 then is rejected and is accepted, meaning that the independent variables are simultaneously퐻0 influence퐻푎 toward dependent variable.

3.8.4t-test Nachrowi and Usman (2004) defined the purpose of conducting this test was to determine the influence of one independent variables (Price, Product, Place, Promotion, Brand Image, and Customer Satisfaction) each to dependent variable (Customer Loyalty). To construct the test, the researcher will compare each t values with t table, which is (1.290) obtained from looking to t table, df = n-1. There are several conditions shall be considered in this test: 1) t calculated >t table, means rejected and accepted.

2) -t calculated <-t table, means퐻 0 rejected and퐻 푎 accepted. 3) -t calculated

Then, compare the significant level or α with the coefficient table significant. 1) If sig. <α, means that rejected, and accepted

2) If sig. ≥ α, means that 퐻0 accepted and퐻 푎 rejected In this research, the researcher퐻 0is trying to determine퐻푎 the influencing independent variable has significant toward dependent variable.

a. Price Hypothesis: ( ) : Price has negative partial significant influence toward Customer Loyalty. ( ) 푯풐 ퟏ: Price has positive partial significant influence toward Customer Loyalty 푯풂 ퟏ b. Product Hypothesis: ( ) : Product has negative partial significant influence toward Customer

Loy푯풐alty.ퟐ ( ) : Product has positive partial significant influence toward Customer

Loyalty푯풂 ퟐ

c. Place Hypothesis: ( ) : Place has negative partial significant influence toward Customer Loyalty. ( ) 푯풐 ퟑ: Place has positive partial significant influence toward Customer Loyalty 푯풂 ퟑ d. Promotion Hypothesis: ( ) : Promotion has negative partial significant influence toward Customer

Loyalty.푯풐 ퟒ ( ) : Promotion has positivepartial significant influence toward Customer

Loyalty푯풂 ퟒ

e. Brand Image Hypothesis: ( ) : Brand Image has negative partial significant influence toward Customer

Loyalty.푯풐 ퟓ ( ) : Brand Image has positive partial significant influence toward Customer

Loyalty푯풂 ퟓ

f. Customer Satisfaction Hypothesis: ( ) : Customer Satisfaction has negative partial significant influence toward

Customer푯풐 ퟔ Loyalty. ( ) : Customer Satisfaction has positive partial significant influence toward

Customer푯풂 ퟔ Loyalty

3.9 Data Analysis In analyzing the data gathered, the researcher used several applications such as Microsoft Excel and Statistical Package for Social Science (SPSS). Microsoft Excel used to simplify the data gathered from the questionnaires, the demographic data were the data analyzed using this application. Besides, SPSS is utilized to examine the data collected by the researcher to calculate the statistical data. Mean scores were applied on all the variables. Descriptive statistics were utilized to display the distribution and the demographics of the respondent, as well as to provide the result of the customer loyalty.

CHAPTER IV

IV. ANALYSIS AND INTERPRETATION

4.1 Company Profile Apple Inc. (Apple), incorporated on January 3, 1977, designs, manufactures and markets mobile communication and media devices, personal computers, and portable digital music players, and sells a variety of related software, services, peripherals, networking solutions, and third-party digital content and applications. The Company's products and services include iPhone, iPad, Mac, iPod, Apple TV, a portfolio of consumer and professional software applications, the iOS and OS X operating systems, iCloud, and a variety of accessory, service and support offerings. In March 2013, the Company acquired a Silicon Valley startup, WiFiSlam, which makes mapping applications for smart phones. Effective July 19, 2013, Apple Inc acquired Locationary Inc. Effective July 20, 2013, Apple Inc acquired Hopstop.com Inc. Effective August 28, 2013, Apple Inc acquired AlgoTrim AB, a Malmo-based developer of prepackaged software. In November 2013, Apple Inc bought PrimeSense Ltd. Effective December 2, 2013, Apple Inc acquired Topsy Labs Inc.

The Company offers a range of mobile communication and media devices, personal computing products, and portable digital music players, as well as a variety of related software, services, peripherals, networking solutions and third- party hardware and software products. In addition, the Company offers its own software products, including iOS, the Company's mobile operating system; OS X, the Company's Mac operating system; and server and application software. The Company's primary products include iPhone, iPad, Mac, iPod, iTunes, Mac AppStore, iCloud, Operating System Software, Application Software and Other Application Software.

4.1.1 History

According to forecast expert consultant company called Data Monitor, Apple was incorporated in 1977. It was co-founded by Steven Wozniak and StevenP. Jobs. They introduced the first Apple I computer in 1976. The Apple I was a failure but Apple IIlaunched in 1980 was successful. The company offered its IPO in the year 1980.

In the early eighties, competition from the PC market and internal difficulties led to critical managementchanges. By 1983, Apple faced stiff competition with the entry of IBM into the PC market, and thefailure of its Apple III version computer. Apple introduced its first mouse driven PC, the Macintosh,in 1984.By 1990, the market was flooded with cheap PC clones and Microsoft had launched Windows 3.0.In 1994, the company launched the PowerPC chip based PowerMac, which allowed Macs to competewith the speed of Intel's PC processors. Apple still had problems though and in 1995, the companyhad a $1 billion order backlog. These problems were compounded by the launch of Windows 95.

The company's performance nosedived in 1995-96 when it lost $68 million.In 1996, Apple acquired NeXT, and by virtue of which, its operating system (OS), Rhapsody, becameApple's next-generation OS. By 1997, Apple had incurred huge losses running in millions of dollars.Mr. Jobs, the co-founder returned as interim CEO. Under his leadership, Apple reorganized toconcentrate on its more profitable competencies, and divested its unsuccessful businesses asspin-offs, including Newton, its personal digital assistant line of products. Soon after Mr. Jobs returned, an agreement was made with Microsoft, and was subsequently followedwith the appearance of MS Office on Mac PCs. In 2001, the company acquired PowerSchool, oneof the providers of web-based student information systems for K-12 schools and school districts,and Spruce Technologies, a privately held company involved in developing and marketing DVDauthoring products.

4.1.2 Products

4.1.2.1 iPhone iPhone combines a mobile phone, an iPod, and an Internet communications device in a single handheld product. Based on the Company's Multi-Touch user interface, iPhone features desktop-class email, Web browsing, searching, and maps and is compatible with both Mac and Windows-based computers. iPhone automatically syncs content from users' iTunes libraries, as well as contacts, bookmarks, and email accounts. iPhone allows customers to access the iTunes Store to download audio and video files, as well as a variety of other digital content and applications. In September 2012, the Company launched iPhone 5, its latest version of iPhone. In addition to the Company's own iPhone accessories, third-party iPhone compatible accessories are available through the Company's online and retail stores and from third parties.

4.1.2.2 iPad iPad is a multi-purpose mobile device for browsing the Web, reading and sending email, viewing photos, watching videos, listening to music, playing games, reading e-books and more. iPad is based on the Company's Multi-Touch technology and allows customers to connect with their applications and content in a more interactive way. iPad allows customers to access the iTunes Store to download audio and video files, as well as a variety of other digital content and applications. In March 2012, the Company launched the iPad, its third generation iPad, and in October 2012, the Company announced its fourth generation iPad and iPad mini. In addition to the Company's own iPad accessories, third-party iPad compatible accessories are available through the Company's online and retail stores and from third parties.

4.1.2.3 Mac The Company offers a range of personal computing products, including desktop and portable computers, related devices and peripherals, and third-party hardware products. The Company's Mac desktop and portable systems feature Intel microprocessors, the OS X operating system and the iLife suite of software for

46 creation and management of digital photography, music, movies, DVDs and Websites. The Company's desktop computers include iMac, Mac Pro and Mac mini. The Company's portable computers include MacBook Pro and MacBook Air.

4.1.2.4 iPod The Company's iPod line of portable digital music and media players includes iPod touch, iPod nano, iPod shuffle and iPod classic. All iPods work with iTunes. In addition to the Company's own iPod accessories, third-party iPod-compatible accessories are available through the Company's online and retail stores and from third parties.

The iPod touch, based on iOS, is a flash-memory-based iPod with a widescreen Retina display, a Multi-Touch user interface, and built-in iSight camera. iPod touch allows customers to access the iTunes Store to download audio and video content, as well as a variety of digital applications. The iPod nano is a flash- memory-based iPod that features the Company's Multi-Touch interface allowing customers to navigate their music collection by tapping or swiping the display and built-in Bluetooth for wireless listening. The iPod shuffle is a flash-memory- based iPod that features a clickable control pad to control music playback and VoiceOver technology enabling customers to hear song titles, artists and playlist names. The iPod classic is a hard-drive based portable digital music and video player.

4.1.2.5 iTunes iTunes is an application that supports the purchase, download, organization and playback of digital audio and video files and is available for both Mac and Windows-based computers. iTunes features integration with iCloud, AirPlay wireless music playback, Genius Mixes, Home Sharing, and syncing functionality with iOS devices. iTunes is integrated with the iTunes Store, a service that allows customers to discover, purchase, rent, and download digital content and applications.The iTunes Store includes the App Store and iBookstore.

4.1.2.6 Mac App Store The Mac App Store allows customers to discover, download and install Mac applications. The Mac App Store offers applications in education, games, graphics and design, lifestyle, productivity, utilities and other categories. The Company's OS X operating system software and its iLife, iWork and other application software titles are also available on the Mac App Store.

4.1.2.7 iCloud iCloud is the Company's cloud service, which stores music, photos, applications, contacts, calendars, and documents and wirelessly pushes them to multiple iOS devices, Mac and Windows-based computers. iCloud's features include iTunes in the Cloud, Photo Stream, Documents in the Cloud, Contacts, Calendar, Mail, automatic downloads and purchase history for applications and iBooks, and iCloud Backup. Users can sign up for free access to iCloud using a device running qualifying versions of iOS or OS X.

4.1.2.8 Software Products and Operating System Software The Company offers a range of software products for consumers and for SMB, education, enterprise and government customers, including the Company's iOS and OS X operating system software; server software; professional application software; and consumer, education, and business oriented application software. iOS is the Company's mobile operating system that serves as the foundation for iOS devices. iOS supports iCloud and includes features, such as Notification Center, a way to view and manage notifications in one place; iMessage, a messaging service that allows users to send text messages, photos and videos between iOS devices, and Maps, with turn-by-turn navigation. iOS supports Siri, a voice activated intelligent assistant, which is available on qualifying iOS devices. OS X, the Company's Mac operating system, is built on an open-source UNIX-based foundation.

4.1.1.9 Application Software included with all Mac computers. iLife features iPhoto, iMovie, iDigital Versatile Disc (DVD), GarageBand and iWeb. iPhoto is the Company's consumer-oriented digital photo application and iMovie is the Company's consumer-oriented digital video editing software application. iDVD is the Company's consumer-oriented software application that enables customers to turn iMovie files, QuickTime files, and digital pictures into interactive DVDs. GarageBand is the Company's consumer-oriented music creation application that allows customers to play, record and create music. iWeb allows customers to create online photo albums, blogs and podcasts, and to customize websites using editing tools. iWork is the Company's integrated productivity suite designed to help users create, present, and publish documents, presentations, and spreadsheets. iWork includes Pages for word processing and page layout, Keynote for presentations, and Numbers for spreadsheets. The Company also has a Multi-Touch version of each iWork application designed specifically for use on iOS devices.

4.1.1.10 Other Application Software The Company also sells various other application software, including Final Cut Pro, Logic Studio, Logic Pro, and its FileMaker Pro database software. The Company manufactures the Apple LED Cinema Display and Thunderbolt Display. The Company also sells a range of Apple-branded and third-party Mac- compatible and iOS-compatible peripheral products, including printers, storage devices, computer memory, digital video and still cameras, and various other computing products and supplies.

Apple TV allows customers to watch movies and television shows on their high definition television. Content from iTunes, Netflix, YouTube, and Flickr, as well as music, photos, videos, and podcasts from a Mac or Windows-based computer can also be wirelessly streamed to a television through Apple TV.

4.1.3 Apple SWOT Analysis Based on the Analysis done by Data Monitor, Apple is engaged in design, development and marketing of personal computers,media devices, and portable digital music players. The company also sells a variety of relatedsoftware, services, peripherals, networking solutions, and third-party digital content and applications.The Apple brand is well recognized amongst most consumers.The company's strong brand enablesit to command a premium pricing and create significant demand for its products uch as iMac, iPod,iPhone and iPad. Strong brand image gives the company an edge over regional and globalcompetitors. However, rising popularity of Android may affect the attractiveness of Apple's iOSaffecting the market share of Apple.

Table 4.1: SWOT Analysis

Source: Data Monitor’s Analysis on Apple Inc (2011)

4.2 Data Analysis

4.2.1 Respondent Demography The respondent description of this research is as follow:

a. Gender of Customers

Figure 4.1: Gender Demography

Gender

Male Female 48% Female Male 52%

Source: Primary Data

The gender distribution of Apple customers gathered in this research includes of female for 52% or 50 persons and 48% or 47 persons of male. This result shows that despite the percentage of female respondents are higher than male respondents, the distribution of this research questionnaire is almost equal between them, and may conclude that the sales of Apple product is not affected by gender classification.

b. Age of customers

Figure 4.2: Age Demography

Age

19-25 77% 15-18 19-25 26-35

26-35 36-45 14% >45 >45 7%

15-18 36-45 1% 1%

Source: Primary Data

The above graphic shows that mostly the respondents of Apple products user is in age range between 19-25 years old with 77% out of 100% which amounted of 75 person, and the rest come from 13 person of 26-35 years old with 14%, above 45 years old with 7 person or equal to 7%, and each of 15-18 and 36-45 is 1% which is 1 person each.

c. Occupation

Figure 4.3: Occupation Demography

Self Employed Occupation 9% Private Company 27% Student

Student Civil Servant 57% Private Company Self Employed

Civil Servant 7%

Source: Primary Data

The most occupation having by the respondents is student with 55 person or about 57%, pursued by private company respondents of 26 persons which is 27%, and self employed user about 9 persons (9%), next is civil servant consist of 7 persons (7%).

d. Income Level

Figure 4.4: Income Demography

Income Level

>8mo 12% 5-8mo <2.5mo 16% 41% <2.5mo 2.5-5mo 5-8mo 2.5-5mo 31% >8mo

Source: Primary Data

The income level of respondents are ranged from the lowest level which is under Rp. 2.500.000, around Rp. 2.500.000 to Rp. 5.000.000, Rp. 5.000.000 to Rp. 8.000.000, and the last is more than Rp. 8.000.000. the accounted amount respondents for each level of income is 40 persons (41%), 30 persons (31%), 15 persons (16%), and 12 persons (12%).

e. Varieties of products

Figure 4.5: Varieties of Products

Products

iPhone 60% iPod iPhone iPad Macintosh iPad iPod 24% iTunes 8% Application Software

Application iTunes Software Macintosh 4% 1% 3%

Source: Primary Data

This demography of respondents shows the varieties of products that being used by the respondents, the varieties consist of 6 products which is iPhone that used by 60% of the respondents which is 58 persons (60%), then iPad is the second product used the most by the respondent which is 23 persons (24%), next, iPod, iTunes, Macintosh, and Application Software are the least products used by the respondents amounted for each product of 8 persons (8%), 4 persons 4%, 3 persons (3%), and 1 person (1%).

f. Years of using

Figure 4.6: Years of Using

Years of using product

2-5yrs 54% 1-2yrs 2-5yrs 1-2yrs 5-8yrs 40% >8yrs

>8yrs 5-8yrs 6% 0%

Source: Primary Data

The most year data of the product’s used period is around 2 to 5 years of using the products which is 54% or about 52 persons. Pursued by 1-2 years of using or about 39 persons (40%), and the last is 5-8 years of using which is 6% or 6 persons.

4.3 Descriptive Analysis

4.3.1 Descriptive Analysis of Price Table 4.2: Descriptive Analysis of Price( )

푿ퟏ

Source: Primary Data

Figure 4.7: Descriptive Analysis of Price ( )

푿ퟏ Price Mean 4 3,9 3,95 3,8 3,87 3,84 3,7 3,6 Price Mean 3,5 3,55 3,4 3,3 a1 a2 a3 a4

Source: Primary Data

The table and figure above showing the frequencies of responses from respondents and the average scale (mean) of questions asked to the respondents. As can be seen, the highest average scale of response belongs to a2 question with mean scored of 3.95 which means the respondents agree that the price of Apple products is premium than other brands.

4.3.2 Descriptive Analysis of Product Table 4.3: Descriptive Analysis of Product( )

푿ퟐ

Source: Primary Data

Figure 4.8: Descriptive Analysis of Product ( )

푿ퟐ Product Mean 5

4 4,34 4,42 4,22 4,22 4,13 4,1 3 3,5 Product Mean 2

0 b1 b2 b3 b4 b5 b6 b7

Source: Primary Data

The table and figure above shows the frequencies of responses from respondents and the average scale (mean) of questions asked to the respondents. As can be seen, the highest average scale of response is b2 question with mean scored of 4.42 which means the respondents strongly agree that the product of Apple is high quality.

4.3.3 Descriptive Analysis of Place Table 4.4: Descriptive Analysis of Place( )

푿ퟑ

Source: Primary Data

Figure 4.9: Descriptive Analysis of Place ( )

푿ퟑ Place Mean 4,1 4 3,9 3,99

3,8 3,86 3,7 3,78 Place Mean 3,6 3,7 3,65 3,5 3,4 c1 c2 c3 c4 c5

Source: Primary Data

The table and figure above show the frequencies of responses from respondents and the average scale (mean) of questions asked to the respondents. As can be seen, the highest average scale of response belongs to c2 question with mean scored of 3.99 which means the respondents agree that Apple store has an appealing decor.

4.3.4 Descriptive Analysis of Promotion Table 4.5: Descriptive Analysis of Promotion( )

푿ퟒ

Source: Primary Data

Figure 4.10: Descriptive Analysis of Promotion ( )

푿ퟒ Promotion Mean 4 3,9 3,8 3,91 3,7 3,74 3,6 3,68 3,5 Promotion Mean 3,4 3,3 3,2 3,34 3,1 3 d1 d2 d3 d4

Source: Primary Data

The table and figure above show the frequencies of responses from respondents and the average scale (mean) of questions asked to the respondents. As can be seen, the highest average scale of response belongs to d2 question with mean scored of 3.91 which means the respondents agree that Apple advertisements suit the brand image.

4.3.5 Descriptive Analysis of Brand Image Table 4.6: Descriptive Analysis of Brand Image( )

푿ퟓ

Source: Primary Data

Figure 4.11: Descriptive Analysis of Brand Image ( )

푿ퟓ Brand Image Mean 4,5 4,4 4,3 4,38 4,2 4,1 4 Brand Image Mean 4,05 3,9 4 3,97 3,92 3,8 3,7 3,6 e1 e2 e3 e4 e5

Source: Primary Data

The table and figure above show the frequencies of responses from respondents and the average scale (mean) of questions asked to the respondents. As can be seen, the highest average scale of response belongs to e5 question with mean scored of 4.38 which means the respondents strongly agree that Apple does have a good company reputation among its user.

4.3.6 Descriptive Analysis of Customer Satisfaction Table 4.7: Descriptive Analysis of Customer Satisfaction( )

푿ퟔ

Source: Primary Data

Figure 4.12: Descriptive Analysis of Customer Satisfaction ( )

푿ퟔ Customer Satisfaction Mean 4,4 4,3 4,34 4,2 4,28 4,1 4,17 Customer Satisfaction 4 Mean 3,9 3,97 3,92 3,8 3,7 f1 f2 f3 f4 f5

Source: Primary Data

The table and figure above show the frequencies of responses from respondents and the average scale (mean) of questions asked to the respondents. As can be seen, the highest average scale of response belongs to f1 question with mean scored of 4.34 which means the respondents are strongly agree and admit that they were satisfied with their decision choosing Apple products.

4.3.7 Descriptive Analysis of Customer Loyalty Table 4.8: Descriptive Analysis of Customer Loyalty( )

풀ퟏ

Source: Primary Data

Figure 4.13: Descriptive Analysis of Customer Loyalty ( )

풀ퟏ Customer Loyalty Mean 4,2 4,1 4,09 4 4,06 3,9 3,93 3,93 3,93 3,8 3,89 Customer Loyalty Mean 3,7

3,6 3,67 3,5 3,4 g1 g2 g3 g4 g5 g6 g7

Source: Primary Data

The table and figure above show the frequencies of responses from respondents and the average scale (mean) of questions asked to the respondents. As can be seen, the highest average scale of response belongs to g6 question with mean scored of 4.09 which means the respondents agree that they will continue to repurchase the Apple products.

4.4 Validity and Reliability Test

4.4.1 Validity Test The validity tests constructed in this research was if the calculated r is positive and (> r table), this shows that the variables are valid and can be used in this research. But, if the calculated r is negative and (< r table), it may conclude that the particular variables are not valid and are not necessary to be used in this research. The r table value comes from the connected value between df=(n-2), since the respondents gathered are 98 persons, so df value become 96 which connected to2-tailed significant level value of 10% (0.1). Thus, the r table value of this research is 0.306.

To determine the calculated r of this research, the Item-Total Statistics table used to compare the value, specifically in Corrected Item-Total Correlation column. The table of validity out is as follow:

Table 4.9: Validity Result of Price

Item-Total Statistics Scale Mean if Scale Variance Corrected Squared Cronbach's Item Deleted if Item Deleted Item-Total Multiple Alpha if Item Correlation Correlation Deleted a1 11.90 4.024 .443 .200 .586 a2 11.63 4.309 .315 .113 .664 a3 11.93 3.375 .461 .268 .575 a4 11.93 3.582 .545 .316 .513 Source: Primary Data

Table 4.10: Validity Result of Product

Item-Total Statistics Scale Mean if Scale Variance Corrected Squared Cronbach's Item Deleted if Item Deleted Item-Total Multiple Alpha if Item Correlation Correlation Deleted b1 24.83 13.040 .611 .530 .780 b2 24.63 13.275 .583 .476 .784 b3 25.53 13.775 .378 .299 .823 b4 24.90 13.197 .561 .390 .788 b5 24.93 14.340 .400 .391 .813 b6 24.97 13.275 .532 .429 .793 b7 25.00 11.517 .836 .704 .735 Source: Primary Data

Table 4.11: Validity Result of Place

Item-Total Statistics Scale Mean if Scale Variance Corrected Squared Cronbach's Item Deleted if Item Deleted Item-Total Multiple Alpha if Item Correlation Correlation Deleted c1 15.53 10.878 .738 .611 .822 c2 15.13 11.637 .671 .547 .840 c3 15.40 12.662 .616 .677 .852 c4 15.50 11.086 .737 .603 .823 c5 15.10 12.852 .685 .692 .840 Source: Primary Data

Table 4.12: Validity Result of Promotion

Item-Total Statistics Scale Mean if Scale Variance Corrected Squared Cronbach's Item Deleted if Item Deleted Item-Total Multiple Alpha if Item Correlation Correlation Deleted d1 11.57 6.737 .515 .309 .776 d2 10.90 6.576 .623 .499 .727 d3 11.17 5.592 .663 .543 .702 d4 11.47 6.257 .597 .386 .736 Source: Primary Data

Table 4.13: Validity Result of Brand Image

Item-Total Statistics Scale Mean if Scale Variance Corrected Squared Cronbach's Item Deleted if Item Deleted Item-Total Multiple Alpha if Item Correlation Correlation Deleted e1 17.77 5.771 .558 .345 .746 e2 18.03 5.757 .485 .287 .779 e3 17.67 6.092 .593 .512 .734 e4 17.60 6.593 .550 .373 .751 e5 17.60 6.041 .671 .604 .713 Source: Primary Data

Table 4.14: Validity Result of Customer Satisfaction

Item-Total Statistics Scale Mean if Scale Variance Corrected Squared Cronbach's Item Deleted if Item Deleted Item-Total Multiple Alpha if Item Correlation Correlation Deleted f1 16.70 7.321 .572 .430 .819 f2 16.73 6.823 .671 .506 .793 f3 16.77 6.599 .695 .511 .785 f4 17.00 7.103 .576 .375 .819 f5 16.93 6.271 .674 .483 .792 Source: Primary Data

Table 4.15: Validity Result of Customer Loyalty Item-Total Statistics Scale Mean if Scale Variance Corrected Squared Cronbach's Item Deleted if Item Deleted Item-Total Multiple Alpha if Item Correlation Correlation Deleted g1 24.67 18.989 .676 .571 .912 g2 24.77 17.426 .796 .698 .900 g3 24.73 18.409 .752 .664 .904 g4 24.57 19.978 .719 .693 .909 g5 24.77 18.944 .732 .727 .906 g6 24.63 17.895 .786 .706 .901 g7 24.87 18.189 .780 .701 .901 Source: Primary Data

The above tables had shown that 37 questions constructed for validity test have r value > 0.306 that were divided into 7 major variables which is valid and can be proceed to collecting data.

4.4.2 Reliability Test The Cronbach Alpha Formula was the measurement tool to find out the reliability of each variable. The particular formula was generated using SPSS 16.0. The range table of reliability rate mentioned before in Chapter 3 had classified the rate range adequate to support the data, it would be better if the value is more than 0,6 to 1. Tables below show the Cronbach Alpha value of each variable.

Table 4.16: Cronbach Alpha of Price Reliability Statistics

Variable: Price

Cronbach's Alpha Cronbach's Alpha N of Items Based on Standardized Items

.656 .658 4 Source: Primary Data

Table 4.17: Cronbach Alpha of Product Reliability Statistics

Variable: Product

Cronbach's Alpha Cronbach's Alpha N of Items Based on Standardized Items

.814 .815 7 Source: Primary Data

Table 4.18: Cronbach Alpha of Place Reliability Statistics

Variable: Place

Cronbach's Alpha Cronbach's Alpha N of Items Based on Standardized Items

.864 .867 5 Source: Primary Data

Table 4.19: Cronbach Alpha of Promotion Reliability Statistics

Variable: Promotion

Cronbach's Alpha Cronbach's Alpha Based on N of Items Standardized Items

.789 .789 4 Source: Primary Data

Table 4.20: Cronbach Alpha of Brand Image Reliability Statistics

Variable: Brand Image

Cronbach's Alpha Cronbach's Alpha N of Items Based on Standardized Items

.784 .796 5 Source: Primary Data

Table 4.21: Cronbach Alpha of Customer Satisfaction Reliability Statistics

Variable: Customer Satisfaction

Cronbach's Alpha Cronbach's Alpha N of Items Based on Standardized Items

.835 .836 5 Source: Primary Data

Table 4.22: Cronbach Alpha of Customer Loyalty Reliability Statistics

Variable: Customer Loyalty

Cronbach's Alpha Cronbach's Alpha N of Items Based on Standardized Items

.918 .919 7 Source: Primary Data

The data above show the value of Cronbach Alpha of each variable, it may conclude that the variables constructed in this research wereabove 0,6 which is reliable. Since the minimum value of Cronbach Alpha is Price variable with rate of 0.658, Product is 0.815, Place is 0.867, Promotion 0.789, Brand Image 0.796, Customer Satisfaction 0.836, and Customer Loyalty 0.919. And may conclude that several variables such Product, Place, Customer Satisfaction, and Customer Loyalty are the most reliable variables due to the Cronbach Alpha of each variable show the rate value is above 0.8 which categorized very reliable.

4.4.3 Classical Assumption Test

4.4.3.1 Normality Test Normality Test used to test the distribution of independent and dependent variable whether the distribution is normal distributed or not. The instruments used to test normality were P-P Plot, Histogram, and Kolmogrov approaches. Each figure was shown below.

Figure 4.14: P-P Plot

Source: Primary Data

Figure 4.15: Histogram

Source: Primary Data

Table 4.23: Kolmogorov-Smirnov Test

Source: Primary Data

The three figures above had disclosed that the distribution is on normal pattern, as can be seen in P-P Plot which the data spread were still following the diagonal line, and the graphic in histogram determined the curve form is in proportional form because of having similar bar ending for the started and the finished bars. The last test is Kolmogrov-Smirnov test which determined the accuracy data of normality tests conducted before, the table above shown that the distribution is normal when the variable of Asymp. Sig (2-tailed) row if the value is more than 0.05 (>0.05).

4.4.3.2 Multi-collinearity Test This test described the relationship linearly between variables.

Table 4.24: Multi-collinearity Test

Model Collinearity Statistics

Tolerance VIF

(Constant)

Price .616 1.623 product .273 3.669 1 Place .484 2.066 promotion .379 2.639 brandimage .437 2.288 satisfaction .308 3.244 Source: Primary Data From the table above, may be described that there is no correlation between each variable. The multi-collinearity may be indicated from the tolerance column which has to be below 0.10, and the VIF column must be above 10. So that, by analyzing the table above, there is no multi-collinearity exists between variable because there is no tolerance is under 0.10 and no VIF value more than 10.

4.3.3.3 Heteroscedasticity Test Figure 4.16: Heteroscedasticity Test

Source: Primary Data

Heteroscadisicity may happened if the distribution of points are not forming a certain and clear pattern, and there is no points located below zero (0) number on Y-axis. Therefore, the figure above showing that there is no heteroscedasticity, which means the variance of observations was distributed evenly.

4.4.3.4 Autocorrelation Test Table 4.25: Autocorrelation Test

Source: Primary Data

The autocorrelation can be analyzed using SPSS application to determine whether there is relationship between variable. By seeing the above table, the value of Durbin-Watson value is 1.739 which shows that there is no autocorrelation and no relationship between variable, where the analyzing factor of autocorrelation is by indicating the value of Durbin-Watson should not below -2 and more than 2 (- 22).

4.4.4 Multiple Linear Regression

4.4.4.1 Regression Model Multiple Linear Regression used to determine the influence of independent variables toward dependent variable of the research. Next, to define the equation, the β value is used to define the coefficient determinant of the independent variables that have correlations with the dependent variable. The table below shows the β value: Table 4.26: Coefficient Table for Equation

Model Unstandardized Coefficients Standardized T Sig. Coefficients B Std. Error Beta (Constant) -.254 .254 -.999 .320 price .449 .062 .461 7.204 .000 product .099 .108 .088 .912 .364 place .083 .053 .114 1.573 .119 promotion -.049 .056 -.071 -.875 .384 brandimage .124 .069 .136 1.788 .077 satisfaction .346 .094 .332 3.667 .000 a. Dependent Variable: loyalty Source: Primary Data

From the data above, the regression model can be constructed from the value of standardized coefficient and generated the equation of regression as follow:

Y = + + + + + + +

Y = - 0.254 + 0.449α 푏 X11푋 1+ 0.099푏2푋 X22 + 푏0.0833푋3 X3푏 –4 0.049푋4 X4푏5 푋+5 0.124푏6 X5푋6 + 0.346푒 X6 + e

Where,

Y = Customer Loyalty

constant or intercept

α ==

1 푋 = 푃푟푖푐푒

2 푋 = 푃푟표푑푢푐푡

3 푋 = 푃푙푎푐푒

4 푋 = 푃푟표푚표푡푖표푛

5 푋 = 퐵푟푎푛푑 퐼푚푎푔푒

6 푋 퐶푢푠푡표푚푒푟 푆푎푡푖푠푓푎푐푡푖표푛

4.4.4.2 Correlation Coefficient (R) and Coefficient Determination ( ) ퟐ The correlation coefficient or can be called Pearson Correlation Coefficient퐑 (R) used to determine how strength is the correlation between independent variables and dependent variables. While coefficient determination used to measure the level of contribution of independent variables to dependent variable. Based on the data had gathered by the researcher, the result model is as follow:

Table 4.27: Analysis of R Value

Model R R Square Adjusted R Std. Error of the Square Estimate

1 .878a .770 .755 .28702 Source: Primary Data

From the table above, it may conclude that the correlation between independent variables which are Price, Product, Place, Promotion, Brand Image, and Customer Satisfaction have a very strong relationship toward the dependent variables which is Customer Loyalty, with R value of 0.878 because the value is included in the interval value between 0.8 to 1. In the other hand, the value shown in adjusted R square is 0.755 which means that 75.5% out of 100% of the dependent variable (Customer Loyalty) is influenced by independent variables selected in this research (Price, Product, Place, Promotion, Brand Image, and Customer Satisfaction).

4.4.4.3 F Test The purpose of this test is to find out the influence of independent variables simultaneously to dependent variable. If F value > F table, means that is rejected and is accepted. The result of F Test is shown in the table below: 퐻표 푎 퐻 Table 4.28: Anova

Model Sum of Squares Df Mean Square F Sig. Regression 25.151 6 4.192 50.885 .000b

1 Residual 7.496 91 .082

Total 32.647 97

a. Dependent Variable: loyalty b. Predictors: (Constant), satisfaction, promotion, price, place, brandimage, product Source: Primary Data

The hypotheses can be constructed as follow: ( ): Price, Product, Place, Promotion, Brand Image, and Customer satisfaction simu퐻0 ltaneously have negative significant influence towards customer loyalty

( ): Price, Product, Place, Promotion, Brand Image, and Customer satisfaction simu퐻푎 ltaneously have positive significant influence towards customer loyalty

Thus, by determining the table above, shows a result of F table value for 50.885 intercepted to significance level of 0.000 is 1.839. Where, the accounted df in F table are df1 = 6 and df2 = 91, thus the F table value is 1.839.

The F value in Anova table must be greater than F table (F value > F table) to prove that the independent variables has significant relationship to dependent variable, and significant value should no more than 0.1 (<0.1), since the F value is (50.885 > 1.839) and the significant is (0.000 < 0.1), then there is significant influence between variables simultaneously.

4.4.4.4 t Test The purpose of conducting this test was to determine the influence of one independent variable (Price, Product, Place, Promotion, Brand Image, and Customer Satisfaction) each to dependent variable (Customer Loyalty). The t test value can be indicated in the table below: Table 4.29: t Test value

To construct the test, the researcher will compare each t values with t table, which is (1.290) obtained from looking to t table, df = n-1 (df = 98-1).

1) Price Hypothesis: ( ) : Price has negative partial significant influence toward Customer Loyalty.

(Rejected)푯풐 ퟏ ( ) : Price has positive partial significant influence toward Customer Loyalty

(Accepted)푯풂 ퟏ The value for Price variable significance shows the amount 0.000, which is less than 0.1. Thus, this variable has significant influence toward customer loyalty.

2) Product Hypothesis: ( ) : Product has negative partial significant influence toward Customer

Loyalty.푯풐 ퟐ (Accepted) ( ) : Product has positive partial significant influence toward Customer

Loyalty푯풂 ퟐ (Rejected) The value for this variable significance is 0.364, and is greater than 0.1. Thus, this variable has negative partial significant influence toward customer loyalty.

3) Place Hypothesis: ( ) : Place has negative partial significant influence toward Customer

Loyalty.푯풐 ퟑ (Accepted) ( ) : Place has positive partial significant influence toward Customer Loyalty.

(Rejected)푯풂 ퟑ This variable value is 0.119 and is greater than 0.1. Thus, this variable has negative significance influence toward customer loyalty

4) Promotion Hypothesis: ( ) : Promotion has negative partial significance influence toward Customer

Loyalty.푯풐 ퟒ (Accepted) ( ) : Promotion has positive partial significance influence toward Customer

Loyalty푯풂 ퟒ . (Rejected) The variable value is 0.384 and is greater than 0.1. Thus, this variable has negative significance influence toward customer loyalty

5) Brand Image Hypothesis: ( ) : Brand Image has negative partial significance influence toward Customer

Loyalty.푯풐 ퟓ (Rejected) ( ) : Brand Image has positive partial significance influence toward Customer

Loyalty푯풂 ퟓ . (Accepted) This variable value is 0.077 and is less than 0.1. Thus, this variable has positive significance influence toward customer loyalty

6) Customer Satisfaction Hypothesis: ( ) : Customer Satisfaction has negative partial significance influence toward

Customer푯풐 ퟔ Loyalty.(Rejected) ( ) : Customer Satisfaction has positive partial significance influence toward

Customer푯풂 ퟔ Loyalty. (Accepted) This variable value is 0.000 and is less than 0.1. Thus, this variable has positive significance influence toward customer loyalty.

4.5 Interpretation of Result In order to determine the result to be interpreted, the researcher will analyze the multiple regression by using three tests, which are Coefficient C orrelation ( R ), Coefficient determination ( ), and F-test. The following results are as follow: 2 a. The correlation between푅 independent variables which are Price, Product, Place, Promotion, Brand Image, and Customer Satisfaction have a very strong relationship toward the dependent variable which is Customer Loyalty, with R value of 0.878 because the value is included in the interval value between 0.8 to 1. b. The value shown in adjusted R square is 0.755 which means that 75.5% out of 100% of the dependent variable (Customer Loyalty) is influenced by independent variables selected in this research (Price, Product, Place, Promotion, Brand Image, and Customer Satisfaction). c. The F-test showing a result of 50.885. And may be identified whether the independent variables has significant relationship simultaneously toward its dependent variable. The F table value is 1.839 this amount is less than the F value which shows that indeed the independent variables (price, product, place, promotion, brand image, customer satisfaction) together has a strong correlation toward dependent variable (customer loyalty). Thus, this test may indicate that the hypothesis is rejected, and is

accepted. 푯풐 푯풂

This research hypothesis also may be answered by analyzing the t-test, whether negative or positive influence is answering the hypothesis. The t-test is aiming to see if each independent variable partially has significant influence toward the dependent variable.

The t-test results are as follow:

1) Price toward customer loyalty Hypothesis: ( ) : Price has negative partial significant influence toward Customer Loyalty.

(Rejected)푯풐 ퟏ ( ) : Price has positive partial significant influence toward Customer Loyalty

(Accepted)푯풂 ퟏ T table value: 7.204, thus, the price variable is the most influential variable towards customer loyalty of Apple users in the community.

2) Product toward customer loyalty T table value: Hypothesis: ( ) : Product has negative partial significant influence toward Customer

Loyalty.푯풐 ퟐ (Accepted) ( ) : Product has positive partial significant influence toward Customer

Loyalty푯풂 ퟐ . (Rejected) T table value: 0.912, thus, the product variable has negative influence towards customer loyalty of Apple users in the community.

3) Place toward customer loyalty Hypothesis: ( ) : Place has negative partial significant influence toward Customer Loyalty.

(Accepted)푯풐 ퟑ ( ) : Place has positive partial significant influence toward Customer Loyalty.

(Rejected)푯풂 ퟑ T table value: 1.573, thus, the place variable has negative influence towards customer loyalty of Apple users in the community.

4) Promotion toward customer loyalty Hypothesis: ( ) : Promotion has negative partial significance influence toward Customer

Loyalty.푯풐 ퟒ (Accepted) ( ) : Promotion has positive partial significance influence toward Customer

Loyalty푯풂 ퟒ . (Rejected) T table value: 0.875, thus, the promotion variable has negative influence towards customer loyalty of Apple users in the community.

5) Brand Image toward customer loyalty Hypothesis: ( ) : Brand Image has negative partial significance influence toward Customer

Loyalty.푯풐 ퟓ (Rejected) ( ) : Brand Image has positive partial significance influence toward Customer

Loyalty푯풂 ퟓ . (Accepted) T table value: 1.788, thus, the brand image variable has positive influence towards customer loyalty of Apple users in the community, and is the least influencer to the loyalty of Apple customers.

6) Customer Satisfaction toward customer loyalty Hypothesis: ( ) : Customer Satisfaction has negative partial significance influence toward

Customer푯풐 ퟔ Loyalty.(Rejected) ( ) : Customer Satisfaction has positive partial significance influence toward

Customer푯풂 ퟔ Loyalty. (Accepted) T table value: 3.667, thus, the customer satisfaction variable has positive influence towards customer loyalty of Apple users in the community, and is the second influencer to the loyalty of Apple customers.

CHAPTER V

IV. CONCLUSION AND RECOMMENDATION

5.1 Conclusion Finally, this research has came to an end, and are having several data as the result answering the statement problem identified before, the conclusions can be drawn from this research are as follow,

The correlation between independent variables which are price, product, place, promotion, brand image, and customer satisfaction are strong, this indicated from the R value can be categorized as having strong correlation since the value of R (0.878) is between 0.8 - 1. Then, the percentage of the correlation exists between the independent and dependent variable is 75.5%.

The independent variables had been proven were simultaneously correlated with the dependent variable, but there were also several independent variables that do not affecting the dependent variable such as product, place and promotion, even though all the independent are reliable, valid, and has strong correlation toward the dependent variable.

From the results above, it may be concluded that there are 3 independent variables which have positive partial significant influence toward dependent variable, the independent variables are Price, Brand Image, and Customer Satisfaction. While the other 3 independent variables that have negative partial significant influence toward the dependent variables are Product, Place, and Promotion. Furthermore, the most partially influencer to customer loyalty is the Price variable, determined by the value T accounted is 7.204, followed by customer satisfaction variable, with T accounted for 3.667, and the last influencer is the brand image with T accounted for 1.788.

Furthermore, the findings are to answer the objectives in this research,

a. To find out partial significant influence of price towards customer loyalty, this research found that there is significant influence of price toward customer loyalty with t-test value of 7.204. b. To find out partial significant influence of product towards customer loyalty, that there is no significant influence of product toward customer loyalty. c. To find out partial significant influence of place towards customer loyalty, that there is no significant influence of place toward customer loyalty. d. To find out partial significant influence of promotion towards customer loyalty, that there is no significant influence of promotion toward customer loyalty. e. To find out partial significant influence of brand image/market positioning towards customer loyalty, this research found that there is significant influence of brand image/market positioning toward customer loyalty with t-test value of 1.788. f. To find out partial significant influence of customer satisfaction towards customer loyalty, this research found that there is significant influence of customer satisfaction toward customer loyalty with t-test value of 3.667. g. To find out partial significant influence of price, product, place, promotion, brand image, and customer satisfaction simultaneously toward customer loyalty, this research found that price, product, place, promotion, brand image, and customer satisfaction simultaneously have significant influence toward customer loyalty with the amount of correlation is about 75.5%.

Finally, customer loyalty is an important aspect that have to be one of the topic continuously concerned by a company in order to maintain its customer retain. Especially, for a company like Apple that in a moment of when whoppers sleep outside of stores just to be one of the first to buy an iPhone, this proves that Apple is a company that enjoys its customer loyalty, success by a well-thought-out plane to deliver strong products and Apple culture to be like what Apple positioning just now.

The elements used in this research to measure the loyalty of Apple customer are marketing mix 4Ps, brand image, and customer satisfaction. Even though there are most variables of marketing mix did not prove to be the variables that influence customer loyalty, still marketing mix is a powerful concept that can makes marketing seen easy to handle, it allows the separation of marketing from other activities of the firm, and can change a firm’s competitive position. (Chee Lee Goi, 2009).

The most influential variable in this research is price, according to Kotler (2008) Price is the amount of money that customer pays in order to get product or service. Customer pays some certain amount of money and as an exchange gets different benefits, and because pricing is also a psychological issue, due to many people measures price with the quality of the product, this kind of psychological issue may be the indicator of why Apple customer tend to be loyal of its products, the measure of price to its quality may affect the customers perspective of the premium price setting by Apple toward its products.

While the other elements of marketing mix may be taken only as a media in order to get the products, product itself is everything that companies provide for its customer and target market, it can mean a physical object which customer can see and touch or it can mean service, ideas, and almost anything (Groonroos, 2005), in this case, Apple providing various products of products and services, as mentioned in the previous chapter about the products produced by Apple.

The other element is promotion, this means everything company does in order to sell their products and services and how they tell about their products to the customer. (Eeva Rajjakallio, 2012). While place is any way that the customer can obtain a product or receive a service as defined by Jones (2007). In the end, Cengiz and Yayla (2007) found marketing mix to have a positive effect toward loyalty on word of mouth attitude, and other positive behaviors toward the company. As the previous research done by Owomoyela, Olasunkanmi, and Oyeniyi (2013) had proven also that marketing mix 4Ps were jointly and independently predict customer loyalty and supported the theory used by them that marketing mix elements have become major business tools for company to pursue its marketing objective.

Furthermore, Armstrong, Kotler, Harker, and Brennan (2009) explain that brand image or market positioning nowadays have become a powerful strategy to gain customers trust, through this differentiation, customers may acknowledge a difference even when competing offers looks the same. Pham Truy Trang (2012) also categorized several positioning companies can set their brand into, but Apple would include in the more for more positioning of a company that offering a brand with comparable high quality brand and with a premium price, this positioning needs to be applied by a company which offers the most premium product or service and charge a higher price to cover its high costs, Apple earns a price premium, that this spans the entire Apple product line up encompassing the Macintosh, iPod, iPhone, iPad, and other Apple products, this also aligned with targeting to a less price sensitive customers.

And there is a strong perception of both corporate reputation and image would tend to increase the degree of both corporate reputation and image would tend to increase the degree of customer loyalty, also the trust and satisfaction that interwoven tightly with the traditional constructs such as image could substantially contribute to loyalty (Heng Yeong Siong, Shi and Kuan, 2011; Nguyen and Leblanc, 2001; Orth and Green, 2009). As in this research finding that brand image or market positioning is the influential factor to Apple customer loyalty.

The last factors used to measure the customer loyalty is customer satisfaction, it depends on how customer compares a perceived of performance of a product and their expectations, customer will get satisfied if the perceived performance is better than their expectation. Customers who get satisfied will purchase repeatedly and would like to share their good experience to other people (Kotler and Armstrong, 2010).

Highly satisfied customers are finally will be much more loyal that satisfied customers and any drop in total satisfaction results in a major drop in loyalty (Rahsa Ali Eliwa, 2006). We may conclude that the degree of satisfaction felt by the Apple customer is high enough to make them loyal to Apple, as well as the accounted t table of this variable that shows as the second most influential variable toward Apple customer loyalty.

As well as the previous research done by Rasha Ali Eliwa (2006), the research proved that the customer satisfaction level and the image attributes could help the operators of the fine dining restaurant operators to develop customer loyalty, and had significant impact on overall customer loyalty of likelihood to return, and recommendation to other customer customers.

Also the other previous research on retail market done by Khoo Chong Heng, Kuit Sui Yeong, Lee Choon Siong, Tan Yi Shi, and Yee Mei Kuan (2011) showed that price does not have relationship to customer loyalty, this much more clarifying that price really is a psychological issue depends on how individual sees price toward a product, one thinks that lower price is prove of competitiveness, and would look to the cheaper product to buy, the other would think price as a quality, that higher price must be neglect and only focus on its quality.

5.2 Recommendation 1. Apple: This research findings can be useful for the company in order to investigating the which factors that have influence to customer loyalty. And the result shown that price, customer satisfaction, brand image, and place are the most variables tested in this research which affecting customer loyalty. The company can give more concern to improving the variables by the dimensions used in this research. Also, maintaining to increase the value of rejected variables which are product and promotion. 2. Future Researcher: The researcher would recommend the future research to further assess the other 24.5% of the influencing factors beside the tested variables in this research. Or assessing the variables rejected in this research with problem statement of why the rejected variables did not influence the customer loyalty, thus will be able to provide more specific discussion regarding Marketing Mix elements, Brand Image, Customer Satisfaction, and Customer Loyalty.

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APPENDICES

QUESTIONNAIRE

Questionnaire – Analysis on influencing factors towards customer loyalty

(A Case study of Apple Inc.)

I humbly request you to fill the questionnaire below by choosing the most suitable option. Sex: (female / male) Age: (15-18 / 19-25 / 26-35 / 36-45 / >45) Occupation: (Student / Civil servant / Private company employee / Self Employed) Income level: (<2.500.000 / 2.500.000 – 5.000.000 / 5.000.000 – 8.000.000 / >8.000.000) Products: (iPod / iPhone / iPad / Macintosh / iTunes / Application Software / Other) Years of using Apple products: (1-2 years / 2-5 years / 5-8 years / >8 years)

Key to options: 1 – Strongly Disagree; 2 – Disagree; 3 – Neutral; 4 – Agree; 5 – Strongly Agree Price 1 2 3 4 5 The price of Apple products is equal to its quality The Price of Apple products is premium price than other brands The discounted price of Apple products attract me more to buy Despite the higher price changing, I would still prefer Apple among other brands Product The Apple products I received is always in good condition The Apple products is high quality The Apple products has many varieties Visual appearance of the products is attractive I find that the Apple products has physically strong I find that Apple software is attractive (e.g iTunes, iCloud, Apple iOS) I find that the Apple products quality meets my expectation Place The Apple store where I can buy the product is near with my place I can easily find the Apple store to buy the products The Apple store has an appealing décor I can easily find public transportation to the Apple store Easy layout of Apple store helps me find the needs I am looking for Promotion The Apple Products is intensively advertised The advertisements suit the brand image

The advertisement is impressive and make me want to buy

The Apple products has an attractive promotions for me (e.g. purchases with operator bundling such as telkomsel, xl, etc)

Brand Image/Market Positioning I consider Apple as a strong brand

I can recognize Apple products among other competing brands

I consider Apple as a premium brand

I can quickly recall the symbol or logo of Apple

The Apple brand has a good reputation

Customer Satisfaction I am satisfied with my decision to choose Apple product

I am satisfied towards the quality of this product

I am comfortable about the relationship with Apple Out of other brands, Apple comes closest to my idea of an ideal products

Overall Apple products meet my needs/expectations

Customer Loyalty

I consider myself to be loyal to Apple because I feel satisfy

Apple would be my first choice Even if another brand has the same features with Apple, I would prefer to buy Apple

I say positive things/experience about Apple products

I would recommend Apple products to those who seek my advice about such matters

I am willing to continue repurchase Apple products

I am willing to purchase other variety of Apple products

RESPONDENTS

(Donelly, 2009) (Borden, 1964) (MAo, 2010)

DATA TABULATION

Price Product 3 3 5 5 4.00 5 5 5 5 5 5 5 5.00 4 5 5 5 4.75 5 5 3 5 5 5 5 4.71 4 4 4 3 3.75 4 3 3 3 4 4 3 3.43 4 3 2 2 2.75 5 4 3 3 3 5 3 3.71 4 3 3 3 3.25 4 4 3 5 4 5 4 4.14 2 5 2 3 3.00 2 5 4 3 5 3 3 3.57 4 5 5 4 4.50 5 5 3 5 5 5 5 4.71 3 4 3 3 3.25 5 5 4 5 4 3 4 4.29 5 4 4 5 4.50 4 5 3 4 4 3 3 3.71 4 4 4 4 4.00 4 4 3 3 4 5 4 3.86 5 5 5 5 5.00 5 5 5 5 4 4 5 4.71 5 4 4 4 4.25 5 5 4 5 5 5 5 4.86 4 5 3 4 4.00 3 4 2 4 5 4 3 3.57 3 4 4 4 3.75 4 4 3 3 3 3 3 3.29 4 5 3 4 4.00 5 5 5 4 4 5 5 4.71 4 3 5 4 4.00 5 5 4 4 4 4 5 4.43 3 5 3 4 3.75 4 5 2 4 4 4 3 3.71 4 4 2 4 3.50 4 5 3 5 5 4 5 4.43 4 4 3 3 3.50 3 3 4 5 4 4 4 3.86 3 4 5 3 3.75 4 3 2 4 5 3 4 3.57

5 5 5 4 4.75 5 5 5 4 5 5 4 4.71 4 4 5 4 4.25 4 5 5 5 3 5 5 4.57 4 4 4 5 4.25 4 5 4 5 4 4 4 4.29 4 5 5 4 4.50 5 5 5 5 5 4 5 4.86 4 5 4 5 4.50 5 5 4 5 5 5 5 4.86 2 2 3 3 2.50 3 2 3 4 2 3 2 2.71 5 5 5 5 5.00 5 5 4 5 5 5 5 4.86 5 4 3 4 4.00 5 5 2 4 4 5 5 4.29 4 3 4 4 3.75 5 4 4 4 3 4 4 4.00 4 5 4 2 3.75 3 5 4 2 4 2 4 3.43 3 5 5 5 4.50 4 4 4 5 4 4 4 4.14 5 5 4 5 4.75 4 4 4 5 5 5 3 4.29 5 5 5 5 5.00 5 4 4 4 4 4 5 4.29 4 4 4 3 3.75 4 3 3 4 3 3 4 3.43 5 5 5 4 4.75 5 5 5 5 5 5 5 5.00 4 4 4 3 3.75 4 3 3 4 3 3 4 3.43 4 3 5 3 3.75 5 4 4 4 4 4 5 4.29 4 3 3 4 3.50 4 4 4 4 3 4 3 3.71 4 3 2 4 3.25 3 4 3 3 4 4 3 3.43 3 3 2 4 3.00 4 4 4 4 4 4 4 4.00 4 4 2 3 3.25 4 5 4 4 4 4 3 4.00 3 3 1 5 3.00 5 4 4 4 3 4 5 4.14 5 4 4 4 4.25 5 5 3 4 4 4 4 4.14

100

4 4 3 2 3.25 5 5 3 5 4 5 4 4.43 4 4 3 4 3.75 4 4 4 4 4 4 4 4.00 4 4 5 4 4.25 5 4 4 4 4 4 4 4.14 4 5 5 4 4.50 5 4 3 4 4 4 4 4.00 3 4 4 3 3.50 5 4 4 4 5 3 4 4.14 5 4 4 5 4.50 5 5 5 5 5 5 5 5.00 5 4 2 4 3.75 4 5 2 5 5 5 4 4.29 3 3 3 5 3.50 5 5 3 5 5 5 5 4.71 4 3 3 3 3.25 5 5 3 4 3 4 3 3.86 3 4 3 3 3.25 3 5 3 3 4 3 3 3.43 4 4 4 3 3.75 4 4 5 4 4 5 4 4.29 2 3 2 3 2.50 3 4 2 3 3 3 3 3.00 4 4 4 5 4.25 5 5 4 5 5 4 5 4.71 3 3 4 2 3.00 3 4 5 3 5 3 4 3.86 3 4 4 3 3.50 5 4 4 4 5 3 4 4.14 3 3 3 3 3.00 3 4 4 4 4 4 3 3.71 4 5 5 2 4.00 4 4 3 4 5 5 5 4.29 4 4 2 4 3.50 4 5 3 5 5 4 5 4.43 4 4 3 3 3.50 3 3 4 5 4 4 4 3.86 3 3 1 5 3.00 5 4 4 4 3 4 5 4.14 5 4 4 4 4.25 5 5 3 4 4 4 4 4.14 4 4 3 4 3.75 4 4 4 4 4 4 4 4.00 4 4 5 4 4.25 5 4 4 4 4 4 4 4.14

101

4 5 5 4 4.50 5 4 3 4 4 4 4 4.00 3 4 4 3 3.50 5 4 4 4 5 3 4 4.14 5 4 4 5 4.50 5 5 5 5 5 5 5 5.00 5 4 2 4 3.75 4 5 2 5 5 5 4 4.29 3 3 3 5 3.50 5 5 3 5 5 5 5 4.71 3 4 3 3 3.25 3 5 3 3 4 3 3 3.43 4 4 4 3 3.75 4 4 5 4 4 5 4 4.29 2 3 2 3 2.50 3 4 2 3 3 3 3 3.00 4 4 4 5 4.25 5 5 4 5 5 4 5 4.71 3 3 4 2 3.00 3 4 5 3 5 3 4 3.86 3 3 1 5 3.00 5 4 4 4 3 4 5 4.14 5 4 4 4 4.25 5 5 3 4 4 4 4 4.14 5 4 2 4 3.75 4 5 2 5 5 5 4 4.29 3 3 3 5 3.50 5 5 3 5 5 5 5 4.71 3 4 3 3 3.25 3 5 3 3 4 3 3 3.43 5 4 4 4 4.25 5 5 3 4 4 4 4 4.14 5 4 2 4 3.75 4 5 2 5 5 5 4 4.29 3 3 3 5 3.50 5 5 3 5 5 5 5 4.71 5 4 2 4 3.75 4 5 2 5 5 5 4 4.29 3 3 3 5 3.50 5 5 3 5 5 5 5 4.71 4 4 3 4 3.75 4 4 4 4 4 4 4 4.00 4 4 5 4 4.25 5 4 4 4 4 4 4 4.14 4 5 5 4 4.50 5 4 3 4 4 4 4 4.00

102

4 5 4 5 4.50 5 5 4 5 5 5 5 4.86 2 2 3 3 2.50 3 2 3 4 2 3 2 2.71 4 5 5 4 4.50 5 4 3 4 4 4 4 4.00 4 5 4 5 4.50 5 5 4 5 5 5 5 4.86 5 4 2 4 3.75 4 5 2 5 5 5 4 4.29 3 3 3 5 3.50 5 5 3 5 5 5 5 4.71 3 4 3 3 3.25 3 5 3 3 4 3 3 3.43 3 5 3 4 3.75 5 4 3 4 4 4 4 4.00 4 3 5 4 4.00 5 4 3 4 4 4 4 4.00

Data Tabulation Place Promotion 5 5 5 5 5 5.00 5 5 5 5 5.00 4 3 4 4 4 3.80 2 4 5 5 4.00 4 4 4 4 5 4.20 3 5 3 3 3.50 3 3 3 2 5 3.20 3 2 2 4 2.75 3 3 3 3 3 3.00 3 4 3 3 3.25 2 5 2 2 2 2.60 2 3 2 2 2.25 3 3 4 3 4 3.40 3 5 4 4 4.00 3 5 5 5 5 4.60 4 4 4 3 3.75 3 3 3 3 4 3.20 5 4 2 4 3.75 4 4 4 4 4 4.00 4 5 5 4 4.50 4 5 5 4 5 4.60 5 5 5 5 5.00 4 5 4 4 5 4.40 5 5 5 5 5.00 4 5 3 2 4 3.60 3 5 4 3 3.75 3 3 3 3 3 3.00 2 3 3 3 2.75 5 5 3 5 4 4.40 3 4 5 3 3.75 4 4 5 4 4 4.20 4 5 4 4 4.25 2 2 4 2 4 2.80 3 5 5 4 4.25 5 5 5 3 5 4.60 2 5 4 3 3.50 3 4 3 3 4 3.40 4 4 3 3 3.50 1 1 2 1 2 1.40 2 4 4 2 3.00 3 3 3 4 3 3.20 4 4 4 3 3.75 3 3 4 3 4 3.40 4 5 5 5 4.75 4 4 4 4 4 4.00 4 4 5 2 3.75 5 5 4 5 4 4.60 3 3 3 5 3.50 5 5 5 5 5 5.00 4 5 5 4 4.50

103

5 5 2 5 3 4.00 4 2 3 3 3.00 5 5 5 5 5 5.00 5 5 5 5 5.00 5 5 5 5 5 5.00 4 4 5 4 4.25 4 5 3 4 4 4.00 3 3 2 2 2.50 3 4 4 4 4 3.80 3 3 2 2 2.50 3 5 5 3 4 4.00 5 5 5 5 5.00 4 5 5 4 4 4.40 4 5 4 5 4.50 5 5 5 4 5 4.80 4 4 5 5 4.50 4 4 3 4 4 3.80 4 5 3 3 3.75 5 5 5 4 5 4.80 4 5 5 4 4.50 4 4 3 4 4 3.80 4 5 3 3 3.75 2 4 4 4 5 3.80 4 4 4 4 4.00 2 3 4 5 4 3.60 3 5 4 3 3.75 2 3 3 3 3 2.80 3 3 3 2 2.75 3 4 3 4 4 3.60 4 4 4 2 3.50 3 4 3 3 3 3.20 3 4 4 3 3.50 5 5 4 5 3 4.40 4 4 4 5 4.25 3 5 4 4 4 4.00 4 5 4 5 4.50 4 4 4 3 3 3.60 3 4 3 3 3.25 4 4 4 5 4 4.20 4 4 4 4 4.00 4 4 3 4 4 3.80 3 3 3 3 3.00 5 5 3 5 3 4.20 3 3 3 4 3.25 4 4 3 4 3 3.60 3 3 3 4 3.25 5 5 4 5 5 4.80 4 5 5 5 4.75 2 3 4 2 4 3.00 1 2 2 3 2.00 5 5 5 4 5 4.80 5 5 5 5 5.00 4 3 4 5 5 4.20 3 4 5 5 4.25 2 2 3 2 2 2.20 2 3 3 3 2.75 2 2 4 2 4 2.80 4 4 4 4 4.00 4 3 3 3 2 3.00 3 3 3 3 3.00 4 3 3 3 3 3.20 3 4 3 4 3.50 4 2 5 1 5 3.40 1 4 4 3 3.00 4 4 3 4 3 3.60 3 3 3 4 3.25 1 2 2 2 2 1.80 3 3 2 3 2.75 4 4 4 3 3 3.60 4 4 3 3 3.50 5 5 5 3 5 4.60 2 5 4 3 3.50 3 4 3 3 4 3.40 4 4 3 3 3.50 5 5 4 5 3 4.40 4 4 4 5 4.25 3 5 4 4 4 4.00 4 5 4 5 4.50 4 4 4 5 4 4.20 4 4 4 4 4.00 4 4 3 4 4 3.80 3 3 3 3 3.00 5 5 3 5 3 4.20 3 3 3 4 3.25 4 4 3 4 3 3.60 3 3 3 4 3.25 5 5 4 5 5 4.80 4 5 5 5 4.75 2 3 4 2 4 3.00 1 2 2 3 2.00 5 5 5 4 5 4.80 5 5 5 5 5.00 2 2 3 2 2 2.20 2 3 3 3 2.75

104

2 2 4 2 4 2.80 4 4 4 4 4.00 4 3 3 3 2 3.00 3 3 3 3 3.00 4 3 3 3 3 3.20 3 4 3 4 3.50 4 2 5 1 5 3.40 1 4 4 3 3.00 5 5 4 5 3 4.40 4 4 4 5 4.25 3 5 4 4 4 4.00 4 5 4 5 4.50 2 3 4 2 4 3.00 1 2 2 3 2.00 5 5 5 4 5 4.80 5 5 4 5 4.75 2 2 3 2 2 2.20 2 3 3 3 2.75 3 5 4 4 4 4.00 4 5 4 5 4.50 2 3 4 2 4 3.00 1 2 2 3 2.00 5 5 5 4 5 4.80 5 5 4 5 4.75 2 3 4 2 4 3.00 1 2 2 3 2.00 5 5 5 4 5 4.80 5 5 5 5 5.00 4 4 4 5 4 4.20 4 4 4 4 4.00 4 4 3 4 4 3.80 3 3 3 3 3.00 5 5 3 5 3 4.20 3 3 3 4 3.25 5 5 5 5 5 5.00 4 5 5 4 4.50 5 5 2 5 3 4.00 4 2 3 3 3.00 5 5 3 5 3 4.20 3 3 3 4 3.25 5 5 5 5 5 5.00 4 5 5 4 4.50 2 3 4 2 4 3.00 1 2 2 3 2.00 5 5 5 4 5 4.80 5 5 5 5 5.00 2 2 3 2 2 2.20 2 3 3 3 2.75 5 5 3 5 3 4.20 3 3 3 4 3.25 5 5 3 5 3 4.20 3 3 3 4 3.25

Data Tabulation Brand Image Customer Satisfaction 5 5 4 4 5 4.60 3 3 5 5 5 4.20 5 5 5 5 5 5.00 5 5 5 5 5 5.00 5 5 5 5 5 5.00 4 4 3 3 4 3.60 2 4 5 5 5 4.20 5 5 5 3 5 4.60 5 5 5 5 5 5.00 5 5 3 4 4 4.20 5 2 5 5 5 4.40 4 4 3 3 4 3.60 5 5 5 5 5 5.00 5 5 5 4 5 4.80 4 5 5 5 5 4.80 4 4 4 4 4 4.00

105

4 3 4 5 4 4.00 4 5 4 4 4 4.20 5 5 4 5 4 4.60 4 4 4 4 4 4.00 5 5 5 5 5 5.00 4 5 5 5 5 4.80 5 4 3 5 5 4.40 5 5 5 5 5 5.00 5 5 5 5 4 4.80 4 4 4 3 2 3.40 3 3 3 5 4 3.60 3 4 3 4 4 3.60 3 3 5 4 5 4.00 5 4 5 3 4 4.20 4 4 5 4 5 4.40 4 5 5 4 4 4.40 3 3 4 4 4 3.60 3 4 5 4 4 4.00 5 5 5 5 5 5.00 5 5 5 5 5 5.00 5 4 4 3 4 4.00 4 3 4 4 4 3.80 4 4 4 4 3 3.80 4 3 3 3 4 3.40 4 4 5 4 4 4.20 5 4 5 4 4 4.40 5 5 5 5 5 5.00 5 5 5 5 5 5.00 5 2 5 5 5 4.40 5 4 4 5 3 4.20 5 5 5 5 5 5.00 5 5 4 5 3 4.40 5 5 5 4 5 4.80 5 5 5 4 5 4.80 3 3 2 3 2 2.60 3 2 3 3 2 2.60 5 4 5 5 5 4.80 5 5 5 5 5 5.00 5 5 5 5 5 5.00 5 5 5 5 5 5.00 5 4 4 5 5 4.60 5 4 4 3 4 4.00 3 3 4 3 4 3.40 3 4 3 3 2 3.00 5 5 5 5 4 4.80 4 4 4 4 4 4.00

106

4 5 4 5 5 4.60 4 4 5 4 4 4.20 4 4 5 5 3 4.20 5 5 4 4 4 4.40 4 5 3 3 5 4.00 4 4 4 3 3 3.60 4 5 5 4 5 4.60 5 5 4 4 4 4.40 4 5 3 3 5 4.00 4 4 4 3 3 3.60 4 4 4 4 5 4.20 4 4 4 4 4 4.00 3 5 4 3 4 3.80 3 5 4 3 5 4.00 3 3 3 2 4 3.00 4 3 3 3 3 3.20 4 4 4 2 4 3.60 4 4 4 4 4 4.00 3 4 3 3 4 3.40 4 4 3 3 4 3.60 4 4 4 5 4 4.20 4 4 5 5 5 4.60 4 5 4 5 5 4.60 5 5 5 4 4 4.60 3 4 3 3 5 3.60 4 5 4 4 4 4.20 4 3 4 4 5 4.00 4 4 4 4 4 4.00 3 3 3 3 4 3.20 5 4 4 4 4 4.20 3 4 3 4 3 3.40 4 4 4 4 4 4.00 3 3 3 4 4 3.40 4 4 3 3 4 3.60 4 5 5 5 3 4.40 5 5 5 5 4 4.80 3 3 4 3 5 3.60 5 5 5 5 3 4.60 5 5 5 5 5 5.00 5 5 4 4 4 4.40 3 4 5 5 5 4.40 3 3 3 3 5 3.40 4 3 4 3 5 3.80 4 3 4 3 3 3.40 4 4 4 4 4 4.00 4 5 4 5 4 4.40

107

3 3 3 3 3 3.00 4 3 3 3 3 3.20 4 4 3 4 5 4.00 5 5 5 4 4 4.60 3 4 4 3 3 3.40 3 3 3 3 3 3.00 3 3 3 4 4 3.40 4 4 3 3 4 3.60 3 3 4 3 4 3.40 4 4 3 4 3 3.60 4 4 3 3 4 3.60 4 5 4 4 4 4.20 5 5 4 3 4 4.20 5 5 5 5 5 5.00 4 4 3 3 4 3.60 4 3 4 4 4 3.80 3 4 4 5 4 4.00 4 4 5 5 5 4.60 4 5 4 5 5 4.60 5 5 5 4 4 4.60 4 4 4 4 5 4.20 4 4 4 4 4 4.00 3 3 3 3 4 3.20 5 4 4 4 4 4.20 3 3 3 4 3 3.20 4 4 4 4 4 4.00 3 3 3 4 4 3.40 4 4 3 3 4 3.60 4 5 5 5 3 4.40 5 5 5 5 4 4.80 4 3 4 3 5 3.80 5 5 5 5 3 4.60 5 5 5 5 5 5.00 5 5 4 4 4 4.40 4 3 3 3 5 3.60 4 3 4 3 3 3.40 4 4 4 4 4 4.00 4 5 4 5 4 4.40 3 3 3 3 3 3.00 4 3 3 3 3 3.20 3 4 3 4 5 3.80 5 5 5 4 4 4.60 3 4 4 3 4 3.60 3 3 3 3 3 3.00 4 4 4 5 4 4.20 4 4 5 5 5 4.60

108

4 5 4 5 5 4.60 5 5 5 4 4 4.60 4 4 3 3 5 3.80 5 5 5 5 3 4.60 5 5 4 5 5 4.80 5 5 4 4 4 4.40 3 3 3 3 5 3.40 4 3 4 3 3 3.40 4 5 4 5 5 4.60 5 5 5 4 4 4.60 4 3 3 3 5 3.60 5 5 5 5 3 4.60 5 5 4 5 5 4.80 5 5 4 4 4 4.40 4 4 4 3 5 4.00 5 5 5 5 3 4.60 5 5 5 5 5 5.00 5 5 4 4 4 4.40 4 4 4 4 5 4.20 4 4 4 4 4 4.00 3 3 3 3 4 3.20 5 4 4 4 4 4.20 3 3 3 4 3 3.20 4 4 4 4 4 4.00 4 5 5 4 5 4.60 5 5 5 4 5 4.80 4 2 3 3 4 3.20 3 3 3 3 3 3.00 3 3 3 4 3 3.20 4 4 4 4 4 4.00 4 5 5 4 5 4.60 5 5 5 4 5 4.80 3 4 3 3 4 3.40 5 5 5 5 3 4.60 5 5 5 5 5 5.00 5 5 4 4 4 4.40 3 3 3 3 4 3.20 4 3 4 3 3 3.40

3 3 3 4 3 3.20 4 4 4 4 4 4.00 3 3 3 4 3 3.20 4 4 4 4 4 4.00

109

Data Tabulation Customer Loyalty 5 5 5 5 5 5 5 5.00 5 4 5 5 5 5 5 4.86 3 3 3 4 4 3 3 3.29 5 2 3 4 3 3 3 3.29 4 3 3 4 4 4 4 3.71 2 3 3 4 4 3 2 3.00 4 4 4 4 4 4 3 3.86 4 4 4 4 4 5 5 4.29 5 5 3 3 3 4 4 3.86 4 4 3 4 4 4 4 3.86 5 5 5 5 5 5 5 5.00 5 5 5 5 5 5 5 5.00 3 3 4 4 4 4 3 3.57 3 3 3 3 3 5 3 3.29 3 3 3 3 3 3 4 3.14 4 5 5 4 4 4 4 4.29 3 4 5 4 4 5 4 4.14 5 5 5 5 5 5 5 5.00 4 4 4 4 4 4 3 3.86 4 2 3 3 4 3 4 3.29 5 5 4 5 4 5 4 4.57 5 5 5 5 5 5 5 5.00 5 5 5 4 4 5 4 4.57 4 5 5 5 5 5 5 4.86 5 5 4 5 5 5 5 4.86 3 3 3 4 3 2 3 3.00 5 5 5 5 5 5 5 5.00 5 5 5 5 5 5 4 4.86 4 4 4 5 3 3 3 3.71 4 4 5 4 2 3 3 3.57 4 3 5 5 5 4 4 4.29 5 5 5 4 5 5 4 4.71 4 5 5 5 5 5 5 4.86 4 4 4 4 3 4 4 3.86 4 5 5 5 4 5 4 4.57 4 4 4 4 3 4 4 3.86 4 4 3 5 3 4 4 3.86 3 4 3 3 4 3 4 3.43 3 4 3 2 4 3 4 3.29 4 3 3 2 4 4 4 3.43 5 4 4 2 3 3 4 3.57 5 3 3 1 5 3 3 3.29 4 5 4 4 4 5 5 4.43 3 4 4 3 2 4 4 3.43 4 4 4 3 4 3 3 3.57

110

4 4 4 5 4 4 3 4.00 3 4 5 5 4 4 3 4.00 4 3 4 4 3 3 3 3.43 5 5 4 4 5 4 4 4.43 5 5 4 2 4 5 5 4.29 4 3 3 3 5 5 5 4.00 3 4 3 3 3 3 4 3.29 3 3 4 3 3 3 3 3.14 4 4 4 4 3 4 4 3.86 3 2 3 2 3 4 4 3.00 4 4 4 4 5 4 4 4.14 5 3 3 4 2 3 3 3.29 4 3 4 4 3 3 3 3.43 3 3 3 3 3 4 4 3.29 4 4 5 5 2 3 3 3.71 5 4 4 2 4 5 5 4.14 4 4 4 3 3 4 3 3.57 5 3 3 1 5 3 3 3.29 4 5 4 4 4 5 5 4.43 4 4 4 3 4 3 3 3.57 4 4 4 5 4 4 3 4.00 3 4 5 5 4 4 3 4.00 4 3 4 4 3 3 3 3.43 5 5 4 4 5 5 5 4.71 5 5 4 2 4 5 5 4.29 4 3 3 3 5 5 5 4.00 3 3 4 3 3 3 3 3.14 4 4 4 4 3 4 4 3.86 3 2 3 2 3 4 4 3.00 4 4 4 4 5 4 4 4.14 5 3 3 4 2 3 3 3.29 5 3 3 1 5 3 3 3.29 4 5 4 4 4 5 5 4.43 5 5 4 2 4 5 5 4.29 4 3 3 3 5 5 5 4.00 3 3 4 3 3 3 3 3.14 4 5 4 4 4 5 5 4.43 5 5 4 2 4 5 5 4.29 4 3 3 3 5 5 5 4.00 5 5 4 2 4 5 5 4.29 4 3 3 3 5 5 5 4.00 4 4 4 3 4 3 3 3.57 4 4 4 5 4 4 3 4.00 3 4 5 5 4 4 3 4.00 5 4 5 4 5 5 5 4.71 4 2 2 3 3 4 3 3.00 3 4 5 5 4 4 3 4.00

111

5 4 5 4 5 5 5 4.71 5 5 4 2 4 5 5 4.29 4 3 3 3 5 5 5 4.00 3 3 4 3 3 3 3 3.14 3 3 5 3 4 4 3 3.57 3 4 3 5 4 4 3 3.71

112