Cibro&Hudrasyah (2017)
Cibro&Hudrasyah (2017)
Cibro&Hudrasyah (2017)
JOURNAL OF
BUSINESS AND MANAGEMENT
Vol. 6, No.2, 2017: 284-300
Abstract
Siete Café is one of popular café in Bandung located at Jl. Sumur Bandung No.20. Siete Café was
established on November 11th, 2011 by 6 students of Bandung Institute of Technology. The target
market of Siete Café is college students from universities and employees in Bandung. In running the
business and apply the marketing strategy, Siete Café implementing 7P’s marketing mix (Products,
People and Process, Price, Place, Promotion, and Physical Evidence) in order to improve customer
satisfaction that will influence customer’s decision to revisit in Siete Cafe. But in 2015, Siete Café had
decreased of total sales numbers caused by the decreased of visitor numbers in that period. This
research aims to identify and analyze the relationship between the factors of Siete Cafe’s marketing
mix (food quality, service quality, place, price, promotion, physical evidence) as an independent
variables to customer satisfaction as the dependent variable, and also the relationship between
customer satisfaction as independent variable toward revisit intentions as a dependent variable. The
data were gathered using questionnaire and distributed to 184 customers who had visited Siete Cafe.
The result showed that the factor of quality food, place, price and promotion does not have a
significant effect (sig> 0.05) towards customer satisfaction in Siete Cafe. While the quality of service
and physical evidence has a significant impact on customer satisfaction in Siete Cafe value (sig> 0.05
and beta = 0.281; 0.309). The results also found that the squared R-value of this study marks a 0.298
value or 29.8%, which signifying the effect of Food Quality, Service Quality, Place, Price, Promotion,
and Physical Evidence of overall Customer Satisfaction. The number is also telling the existence of a
70.2% contribution of the Customer Satisfaction Measurement that is not covered in this study.
However, the value of the squared R is 0.503, or 50.3% of the effect of Customer Satisfaction toward
the Revisit Intention to Siete Cafe. The result will be functional for Siete Cafe’s management to
evaluate and enhance the factors that might enhance the customer satisfaction to induce their
intention to revisit, specifically physical evidence and service quality. Siete Cafe also needs to analyze
the market trend in order to improve marketing strategies.
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Introduction
The growth of the culinary industry, especially the restaurant and cafe business in
Bandung has increased over the period from 2011 to 2016, that impacted increasing of
competition among restaurant and cafe business competitors to attract visitors. In order
to increase competition, each of companies could be a leader of competition by showing
their own best products and being able to meet consumer’s wants which always change
dynamically (Kotler, 2005). If companies are not accustomed to being sensitive to market
changes and to be innovative by creating new creative ideas of products or services, they
could not survive in the tough competitions.
This research will be performed on Siete Café as the object of the study. Siete Café is
one of popular café in Bandung located at Jl. Sumur Bandung No.20. Siete Café was
established on November 11th, 2011 by 6 students of Bandung Institute of Technology.
The target market of Siete Café is young people as high school or college students from
school or universities and employees in Bandung, with middle- high income who look
for places to eat, to study or meeting, and also for hangout with friends. Siete Café
opens from 11 am to 12 pm. In running the business and apply the marketing strategy,
Siete Café implementing 7P’s marketing mix as follows: Products, Price, Place,
Promotion, People, Physical, and Process. Siete Café has quite variations from
Indonesian to Western dishes, and “Steak” is the main signature of Siete Café. The
menu prices start from IDR 10000 to IDR 62000. The price is excluded from tax and
services charge of 12,5 %. The location of Siete Café is the intersection of Jl. Dago, Jl.
Dipatiukur, Jl. Sangkuriang, which is adjacent to several universities in Bandung such as
ITB, UNPAD, UNIKOM, and ITHB so it can be said quite strategic considering the target
market of Siete Café is college students.
In promotion and marketing strategy, Siete Café uses social medias such as Instagram,
Facebook, and Twitter in order to give information and introduces Siete Café to public
so that they can attract peoples to come to Siete Café. Periodically, Siete Café gives
promotion through voucher discounts, marketing campaigns, and marketing events
such as music events and performances, visual art exhibitions, and private party.
Currently, Siete Café is run by 38 persons that get involved in their own jobs and job
analysis through job descriptions that specify some job summaries, tasks, and
responsibilities. All employees in Siete Café are trained to have good skills of
communication. In marketing activity, the employees also act as sales person. Physical
evidence of Siete Café is the building, the equipment such as seats, tables, cutleries,
AC, the exterior facilities, interior facilities, physical communication, environment, and
the layout.
In 2015, Siete Café had decreased of total sales numbers caused by the decreased of
visitor numbers in that period. This condition certainly would impact activities and
performances of Siete Café entirely if they did not handle this. If the decrease occurred
continuously, it will affect the performance of Siete Café and their business activities. By
that reason, this research is intended to find the correlation between the customer
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satisfaction with the intention to revisit Siete Café. Through this research, it is expected
to discover what steps and strategy need to be done by Siete Café to handle the
problems.
The objectives research are to find out the factors of customer satisfaction that would be
affecting the customer intention to revisit in Siete Café, to analyze the correlation
between the factors from Siete Café’s marketing mix (food quality, service quality, place,
price, promotion, physical evidence) to customer satisfaction measurement and also
from the customer satisfaction measurement towards revisit intention at Siete Café, and
the last to give the recommendations for Siete Café in order to increase the total number
of customers, to maintain customer’s satisfaction and be able to compete with other
competitors.
Literature Review
Marketing mix
In order to maximize the effectiveness of sales and attracting more customers, utilizing a
set of controllable marketing tool, or marketing mix on the target market is an
indispensable part of a business strategy (Kotler, Armstrong, Wong, & Saunders 2008).
One of the marketing mix’s objective is to help the business in defining their marketing
elements, therefore strengthening the business’ positioning in the market and enhancing
their customer’s satisfaction (Shahhosseini & Ardahaey 2011; Suprihanti 2011). James
Balda as a Chief Marketing and Communications Officer of the National Restaurant
Association said that to success in the restaurant industry, the companies should be able
to find and applied the right marketing mix (Association, N. R., 2012).
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quality is one of the key factors in achieving the desired level of customer satisfaction
(Zeithaml, Berry, & Parasuraman, 1996).
Place
In order to heighten the customer satisfaction, the location of the dining place is an
aspect of importance (Hyun, 2010). Which is why, in the modern times the location of a
restaurant offer a more crucial value for the customers, specifically in terms of the cost to
visit and the environment, as well as how the restaurant is capable to fulfill the
customer’s demands (Brocato, 2007). Suhud, U. and Wibowo, A (2016) state that for
some restaurant, location can be one of most crucial aspect to increasing the restaurant’s
attractiveness to the customer.
Price
Price is related to what things/efforts are given up or sacrificed to obtain a product. Price
and service quality are closely associated with the customer satisfaction and service
providers, as proven by the study which examining the direct impacts of price and service
quality on the business’ profits and market share as well as a study regarding the
customer purchasing behavior (zeithaml, 2000). Pricing will lead to determining the final
price of a product, which makes managers should have all the information about the
pricing objective, demand curve, to the probable quantities regarding every possible
price and competitors’ costs, prices, and offers (Štefko, Gburova, & Jurkova, 2011). The
selected pricing method and the final price could be divided into several categories:
overprice (price with a higher possibility of losing a sale which otherwise would be more
profitable at a lower price), underprice (price which will be more likely to create an
unprofitable sale), and the right price whereas possessing a high probability of
appropriately making both sale and profit (Štefko, Gburova, & Jurkova, 2011). One of the
most frequently utilized price adjustment strategies is the revisiting price strategy
because pricing strategy has the ability to directly influencing the customer satisfaction
(Štefko, Gburova, & Jurkova, 2011). Kotler and Lane (2008), there is a positive
relationship between perceived price fairness and satisfaction which ultimately affecting
the customer’s overall satisfaction.
Promotion
The promotion, as one of the marketing mix elements, possess multiple functions both in
social, economical, and confrontational within the market (consumers, competition), as
well as the company (Arapi, 2013). Promotion is a crucial marketing strategy as it has the
ability to providing the necessary information, advice, and persuading the targeted
market. Promotional strategy is consisted of sales promotion, advertising, sales force,
public relations and direct marketing (Tariq Khan, 2014) and carried by the individual
salesperson, T.V, radio, internet, magazine, press, as well as other types of media. The
promotion strategy hold the capability to influence consumer’s decision making to
purchasing a product (Tariq Khan, 2014). Promotion activity is an integral part of the
shopping experience which positively affects customer satisfaction (Promotion
Marketing Association of America, 2012).
Physical Evidence
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According to Palmer (1998), one of the marketing mix factor that requiring a higher focus
to be successful in service industries is none other than the physical evidence. Physical
evidence includes physical facility, environment involved in services deliver between
service providers and consumers that interact and the other components that facilitate
the offered appearances (Zeithaml & Bitner 1996). According to Hoffman and Bateson
(1997), physical evidence is divided into three categories such as exterior facilities,
interior facilities, and physical communications which objective is to create an easier
activity flow within the services. Customers will get a perceived quality from the physical
environment (Baker, et al., 1994; Nguyen & Leblanc, 2002) and the service quality (Lai, et
al., 2009) that have the ability to significantly influencing the image of the restaurant,
which leading to the customer's satisfaction as well as the loyalty of the customers (Lai,
et al., 2009; Patterson & Spreng, 1997; Prendergast & Man, 2002; Ryu, et al., 2008).
Customer Satisfaction
Customer satisfaction defined as a summary of responses which was created based on
the customer’s experience upon trying out a product or services. Yan and Chau (2013)
have researched that a customer satisfaction can also be referred as a combination of
customers’ feelings about services in different dimensions whereas the customer will be
comparing the actual benefit and customer cost with the customer’s own expected level
of benefit to determine their satisfaction. The importance of measuring and monitoring
customer satisfaction, as the highly valuable and critical information for developing
customer purchase intention is sourced from the result of measuring and monitoring the
customer satisfaction level (Baker & Crompton, 2000), as well as predicting the
customer’s revisit and repurchase intention (Jang & Feng, 2007; Petrick, Morais,
&Norman, 2001). Oliver and Burke (1999), mentioned the positive association between
the intention to revisit with the customer satisfaction. Consequently, the customer
satisfaction is often regarded as one of the most important aspects to induce the
customer’s revisit intention toward a restaurant. The customer’s satisfaction level have
the tendency to be strongly associated with both customer’s repeat purchase intentions
and returning the purchase.
Revisit Intention
Revisit intention is defined as the probability of a customer to consciously perform a
repurchase of the product or service in the near future (Oliver, 1997). Hume, Mrgee and
Mort (2007) also stated that a revisit is a decision which initiated by the customer in order
to continue the healthy relationship between the customer and the provider of products
and services. In terms of marketing and customer behavior, the behavioral intention
concept possess a significant impact in encouraging the purchasing decision of the
customer in both negative and positive direction. The positive intention will increase the
customer’s probability to revisit the restaurant as well as recommending the restaurant
toward the customer’s relatives. Oppositely, the negative intention will decrease the
customer’s intention to revisit the restaurant (Jani & Han, 2011). The business also must
understand the factor and value they want to deliver as well as the attribute required in
order to influence the customer to revisit and repurchase. Understanding the customers’
needs will severely aiding the service provider to meet the customer expectation,
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maintaining the customer loyalty, and preventing the defection that leads the restaurant
to the loss (Haghighi, Dorosti, Rahnama, & Hoseinpour, 2012).
Hypotheses Development
Based on several references and journals, this research will summarize all the theories
that will be used and related with this study to a conceptual framework and generated
hypothesis have been developed on the basis of literature reviewed above:
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The research is suggested to use a mixed method that combined quantitative method
and qualitative approach. The quantitative method was used to test and measure the
value of each element of the marketing mix based on customer’s perception to
determined the factors of customer satisfaction that would be affecting the customer
intention to revisit in Siete Café, and also to analyze the correlation between the factors
from Siete Café’s marketing mix (food quality, service quality, place, price, promotion,
physical evidence) to customer satisfaction measurement and from the customer
satisfaction measurement towards revisit intention at Siete Café. It is used to collect
primary data, which is gathered by distributing survey using questionnaire. The
questionnaire will be distributed through two ways: online and offline, and targeted
customers with numbers of males and females about 17-35 years old (high school,
college students, and employees) who had visited Siete Cafe and have/plan to revisit
intention. The number of respondents who will fill this questionnaire either online or
offline amounted to 184 people. Whereas, the qualitative approach in this research is
conducted in the form of exploratory research by doing an in-depth interview with the
owner of Siete Cafe directly (face-to-face meeting) in Siete Cafe.
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Validity test is used to determine the validity of a questionnaire. In order to pass the
test, the value of the indicator are required to be higher than 0.5. Kaiser-Meyer-Olkin
(KMO) test is the chosen methods of testing within the variables and the value should
be above 0.5 signifying validity. Meanwhile, reliability test will be determined from the
value of Cronbach Alpha which is higher 0.7. Reliability signify the internal consistency
of the question. The data analysis Technique using Microsoft Excel to compile and
arrange the data, then the results will be used as raw data for descriptive statistics such
as data demographic profile of respondents, the respondent experience and perception
toward the factors in the marketing mix of Siete Cafe, as well as the main database for
SPSS. Multiple linear regression analysis to find out relationship between two or more
independent variables (x1, x2, ..., Xn) with the dependent variable (Y). The first model is
the relationship between the Food Quality, Service Quality, Place, Price, Promotion,
Physical Evidence as independent variables to Customer Satisfaction as the dependent
variable. The second model is the relationship between the Customer Satisfaction as
independent variables to Revisit Intention as the dependent variable. Coefficients
determination (R2) essentially will measures how far the ability of the model to explain
variations in the dependent variable. It shows the percentage effect of all independent
variables on the dependent variable. The last is path analysis will be used to determine
the influence and the contribution indicated by the path coefficients at each diagram
the path of a causal relationship between independent variables (X1, X2, ... Xn) to the
dependent variable ( Y).
Results
This research utilized 8 different variables to test the hypothesis in order to answering
the questions of this study. Each variable will have measures which represent respective
variables. Kaiser-Meyer-Olkin (KMO) test is the chosen methods of testing within the
variables and the value should be above 0.5 signifying validity. Meanwhile, reliability test
will be determined from the value of Cronbach Alpha which is higher 0.7. According to
the result of the study, the KMO values indicating a ≥ 0.5 value, which indicating the valid
correlation between the indicators of each variables. Meanwhile, the number in
Cronbach’s Alpha signifying a ≥ 0.7 value, which indicating the reliability of the indicators
of each variable. Further into the study, the total variance value of ≥ 50% as well as factor
loading of ≥ 0.5 indicating the validity of every factors in this study. Therefore, proving
the validity and reliability test and passed for a regression analysis.
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FQ5 5 0.830
FQ6 6 0.612
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PE11 39 0.717
PE12 40 0.761
PE13 41 0.821
PE14 42 0.882
PE15 43 0.648
PE16 44 0.837
PE17 45 0.761
According to the above models, the Asymp. Sig. (2 tailed) score higher than 0.05 which
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signifying the normality of the sample, therefore validating the normal distribution of the
samples. The second classical assumption test is the Multicollinerity test, which purpose
is to test a strong relationship among the independent variables in a Double Linear
Regression Analysis, as there should not be a Multicollinerity within each independent
variables.
Table 4.10
Multicollinearity
Model 1 Colinearity Statistics
Variables Tolerance VIF Model 2 Colinearity Statistics
Food Quality 0.914 1.094 Variables Tolerance VIF
Service Quality 0.669 1.495 Customer
Place 0.904 1.106 Satisfaction
1.000 1.000
Measurement
Price 0.951 1.051
(CSM)
Promotion 0.945 1.058
Physical
0.712 1.404
Evidence
To test the Multicollonerity, the value of VIF should be less than 10 and the value of
tolerance should be higher than 0.1. Therefore, the Multicollonerity test above signifying
the lack of correlation between the independent variables thus ensuring the validity, it
can be concluded that there is no multicollinearity. The third classical assumption test is
the Autocorrelation test. The Autocorrelation test is conducted on the model 1 of the
Double Regression Analysis since model 2 is done by a Simple Regression Analysis. The
value of Durbin-Watson in the Model 1 is 1.771, by comparing the value with the
significant value of 5% on the Durbin-Watson Significance Table with the value of n of
184 samples and k’= 6 as the amount of independent variables within this study, the
result of dL of 1.707 and dU of 1.831 are obtained. The value of Durbin-Watson in Model 1
is located right in the middle of dL and dU value (Firdaus, 2014), therefore proving the
absence of autorrelation within the regression in the Model 1.
In this study there will be two models to be conducted, the first one is to identifying the
relationship between the Food Quality, Service Quality, Place, Price, Promotion, and
Physical Evidence toward Customer Satisfaction Measurement and the other one will
analyzing the relationship between the Customer Satisfaction Measurement with the
Revisit Intention Measurement.
Table 4.11
The relationship of Independent Variable to Dependent Variable Model 1
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Table 4.12 .
The relationship of Independent Variable to Dependent Variable Model 2
The relationship between the Customer Satisfaction Measurement against the Revisit
Intention Measurement as the significant value is 0.000 which is below 0.05. The
relationship is enhanced further by the high beta coefficient score of 0.709 which
signifying the influence of Customer Satisfaction Measurement toward the Revisit
Intention Measurement. However, the value of the squared R is 0.503, or 50.3% of the
effect of Customer Satisfaction toward the Revisit Intention to Siete Cafe, this means
aside from the Customer Satisfaction, there is other 49.7% of the influencer which is not
covered in this study.
In conclusion, based on the finds in this study, the results are follows:
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H1: Food quality has significant impact on customer satisfaction. –NOT SUPPORTED
H2: Service quality has significant impact on customer satisfaction. –SUPPORTED
H3: Place has significant impact on customer satisfaction. –NOT SUPPORTED
H4: Price has significant impact on customer satisfaction. –NOT SUPPORTED
H5: Promotion has significant impact on customer satisfaction. –NOT SUPPORTED
H6: Physical evidence has significant impact on customer satisfaction. SUPPORTED
H7: Customer satisfaction has significant impact on revisit intention. –SUPPORTED
Framework Summary
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Table 4.13
Path Analysis
The Path Analysis is displaying the total influence of the independent variable toward
the dependent variable. Customer Satisfaction Measurement possess the highest direct
influence toward the Revisit Intention Measurement, while Physical Evidence and
Service Quality are of some influence toward the Customer Satisfaction Measurement.
Conclutions and Recommendation
This study found there is no significant impact between the food quality, price, place, and
promotion toward the customer satisfaction as those factors possess a > 0.05 significant
value with 95% confidence level based on the result of the questionnaire conducted.
Furthermore, the significant factors of physical evidence with 0.309 beta value and
service quality of 0.281 beta value are contributing no more than 0.298 squared R value
toward the customer satisfaction of the Siete Cafe’s customers. This proving the study of
Zeithaml, Berry, & Parasuraman, 1996, which stated that the service quality is one of the
key factors in order to achieve the customer’s satisfaction as well as the effect of the
physical evidence on the customer’s satisfaction (Baker et al., 1994; Nguyen and Leblanc,
2002). This study also found the significant impact of the customer satisfaction toward
the intention to revisit. With 0.709 beta value and 0.503 squared R value, customer
satisfaction does signifying a decent correlation with the intention to revisit Siete Cafe.
Consequently, the customer satisfaction is often regarded as one of the most important
aspects to induce the customer’s revisit intention toward a restaurant (Oliver and Burke,
1999).
However, in terms of the factors which are not covered in this study, the result of the
questionnaire suggesting a social factor as a significant factor for the Siete Café’s
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customer satisfaction and the revisit intention, whereas the customer’s motives are
including eating because being invited by a friend (69% of the respondents), visiting
Siete Café with a friend (90.8% of the respondents), and learning about Siete Café from a
friend (88.6% of the respondents) which proving the theory regarding how Bandung is a
city of creative culture, sociable people, and a gathering of community in a recreational
and socializing places (Maharani, 2013).
Recommendation
1. Improving the factors which possess a significant impact toward the customer
satisfaction in order to raise the intention to revisit. This includes physical
evidence and service quality factor as the priority of improvement.
2. Implementing or improving the service quality training toward the service staffs
including the waiter, waitress, and cashier in order to enhance the service quality
factor, specifically addressing the issue of the incapability of the menu
explanation toward the customer as well as the lack of capability to answering
the inquiries of the customers properly.
3. Particularly on the physical evidence factor, it is highly recommendable for Siete
Cafe to improve the condition of their toilets, parking area, lightning, food menu
designs, and the selection of books inside the cafe.
4. Speaking of the promotion aspect, since most of the customers are either being
invited to visit Siete Cafe by a friend, learn about Siete Cafe from a friend, or
visiting Siete Cafe with a friend, it is highly recommendable for Siete Cafe to
build a promotion strategy around the social aspect of the customers in order to
enhance the main factor of the customer experience therefore raising the
customer satisfaction and the customer’s intention to revisit.
5. Analyzing the current market for the cafe in Bandung area, particularly the
customer's behavior and the direct competitors. The purpose of the market
analyzation is to determining the exact factor which supporting the actual revisit
behavior despite the disagreement of the intention to revisit, thus putting a
priority toward that factor.
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