Monetary and time costs

All the path coefficients were significantly different from zero with respective t-values greater than 1. 96 and their signs were in the hypothesized direction. Perceived service quality was found to display a positive effect on customer satisfaction (? =0. 66, p<0. 05), and perceived value (? =0. 73, p<0. 05). As customers’ perceptions of the quality of the service increase, they feel more satisfied with the service and perceive higher value in the service. Thus, hypotheses one and two were supported.

Monetary and time costs were found to display a negative effect on perceived value, the path coefficients were (? = -0. 17, p<0. 05) and (? = -0. 19, p<0. 05) respectively. These results suggest that both monetary and time costs play a significant role in customers’ assessments of the value of the service. Accordingly, hypotheses three and four were supported. Perceived value was shown to have a positive effect on customer satisfaction (? =0. 21, p<0. 05) and intended post-purchase behaviour (? =0. 63, p<0. 05).

Thus, hypotheses five and six were also supported. It is interesting to note that perceived value has a stronger impact on intended post-purchase behaviour than on customer satisfaction. As customers perceive that the value of the service increases, they feel more satisfied with the service and their tendency to repurchase and recommend the service to others becomes higher. Studies have found that the effect of perceived value on repurchase intentions is completely mediated by customer satisfaction (Patterson and Spreng 181-221).

In order to examine whether the effect of perceived value on behavioural intentions would indeed be completely mediated by customer satisfaction, an alternative model was proposed with the parameter of the structural path between perceived value and intended post-purchase behaviour constrained to zero. A Chi-square difference test was performed to assess the overall fit of the theoretical model and the alternative model. Steiger et al.

(58-93) stated that the difference between Chi-square statistics for the nested models is itself asymptotically distributed as Chi-square, with degrees of freedom equal to the difference in the degrees of freedom for the two models. The results of the Chi-square difference test showed that the theoretical model provided a better overall fit to the data than the alternative model, the Chi-square difference was 48 with one degree of freedom (p<0. 05).

Thus, the notion that perceived value has both a direct and an indirect effect through customer satisfaction on behavioural intentions is supported by the data. Hence, hypothesis seven was supported. Consistent with the results of previous research, customer satisfaction displayed a significant influence on intended post-purchase behaviour (? =0. 33, p<0. 05). As customers feel more satisfied with the service, they will be more likely to repurchase and encourage others to use by word of mouth.

Accordingly, hypothesis eight was supported. Further analyses were conducted to examine the relationships between monetary costs and quality, monetary costs and customer satisfaction, and monetary costs and intended post-purchase behaviour. Each path was evaluated in turn to determine whether monetary costs had any direct influence on quality, customer satisfaction and intended post-purchase behaviour respectively.

The results showed no significant improvement in model fit, suggesting that customers’ perceptions of quality were not affected by monetary costs, and the effect of monetary costs on customer satisfaction and intended post-purchase behaviour were mediated through perceived value. Although customer satisfaction has been used as a means of achieving the business goals of Marriott Hotel restaurant, the assumption that satisfied customers will make repeated purchases and tell others about their satisfying experiences may no longer hold in highly competitive markets.

The present study shows that perceived value has relatively speaking, a greater influence on post-purchase behaviour than customer satisfaction as is evidenced by the standardised path coefficients of 0. 63 for perceived value and of 0. 33 for customer satisfaction shown in Table 4. Moreover, the results of this study reveal that adding the path between perceived value and post-purchase behaviour has improved the overall fit of the model. This suggests that integrating perceived value with customer satisfaction and perceived service quality in a single model can better explain and predict post-purchase behaviour.

Although increasing customers’ perceptions of service quality can result in high customer satisfaction and perceived value, the effect of perceived service quality on perceived value might be offset by high waiting time. There are instances in which customers may feel satisfied with a service in Marriott Hotel restaurant, but their perceptions of its value are low due to the high costs incurred in obtaining it. When they learn that another supplier is offering a better value service, their likelihood to switch is high.

Price may play several roles in the customer purchase decision process. Prior to a purchase, customers may use price as an indicator of quality, and set expectations in regard to the service they are likely to receive (Zeithaml and Bitner 234-293). Following the consumption of the service, price is one of the costs perceived by customers, and contributes to value assessment of the service (Lovelock 176-197). The present study provides evidence of the contribution of price to customer assessment of a service value.

As predicted, the relationship between quality and price was found to be weak. This may suggest that customers’ perceptions of quality are not driven by price perceptions in post-purchase evaluations. However, the relationship between quality and price should be not underestimated in an initial purchase. Since services lack tangible cues for customers to assess their quality prior to consumption, price might have an effect on customers’ perceptions of the quality of a service to be provided in pre-purchase evaluations.

Thus, Marriott Hotel restaurant needs to be very careful about attempting to make the service offered more appealing by lowering prices. It needs to convince customers that a reduction in price is accompanied by a reduction in the quality of service. The promotional message should emphasise the benefits of the service relative to the costs and educate customers to recognise its value. In line with this view, Berry and Yadav (56-85) suggest that service firms should capture and communicate value to customers in their pricing strategy.