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Quality, University Image, Satisfaction and Loyalty

Quality, University Image, Satisfaction and Loyalty

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Published by Allen Alfred
International Academic Journals http://bellpress.org/Journals
International Academic Journals http://bellpress.org/Journals

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Published by: Allen Alfred on Feb 09, 2013
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European Journal of Education and Learning, Vol.12, 2012ISSN(paper)2668-3318 ISSN(online)2668-361Xwww.BellPress.org 10
Quality, University Image, Satisfaction and Loyalty : A Study of a Distance GraduateStudy Program
 Nur Hidayah
Graduate Study Programs, Universitas Terbuka (Indonesia Open University)2.
Muhammadiyah University, Jakarta, Indonesia
E-mail of the corresponding author : psuciati@ut.ac.id
As competitions between universities to attract students become intense, securing student loyalty has become an important issue in higher education. Universitas Terbuka (Indonesia Open University), for 28 years has enjoyed the status as the ‘only’ distance education institution in Indonesia, however thiscondition will change with the implementation of a new legislation by the Government 2012, permitting universities to offer e-learning programs, and dual-methods education programs.Competition for students may become an issue to be addressed creatively by UT. Student loyalty is adynamic phenomenon with many factors playing significant roles. This study explains the effect of students’perception of program quality, brand image, and student satisfaction on student loyalty. Thissurvey was conducted during 2011, involving 108 graduates of the Graduate Study Program atUniversitas Terbuka. The findings demonstrate that student loyalty is influenced by the programquality, brand (the university) image and student satisfaction, individually or simultaneously. Programquality does not have a direct effect on student loyalty, while brand image and student satisfaction havedirect effect on loyalty. However, program quality does influence student satisfaction.
: quality, university image, satisfaction, loyalty, graduate study.
1. Introduction
Student loyalty is becoming an increasingly important and strategic issue for higher educationinstitutions (Helgesen & Nesset, 2007; Sauer & O’Donnell, 2006).Competitions between universitiesto attract students become intense. Especially with the diminishing budget from the government,universities have to find revenue from students tuition. To achieve this purpose, many universitieshave actively launched promotiomalefforts to uplift the image of the university and to attract newstudents. Nevertheles the efforts of recruiting new students should not neglect students who arealready in the system. To put it differently, maintaining the loyalty of students in the pipeline is notless important than new students recruitment. Research in the business sector indicates that retainingexisting students (customer) and ‘selling additional products’ (to the same students), is less costly thanthe acqusition for new recruits (Chu,Tsai, & Ho, 2007; Pendharkar, 2009).As an open and distance education institution, Universitas Terbuka (The Indonesia Open University)has confronted similar challenges at national and global levels. Under the stipulation of the (newgovernment legislation) Education Constitution 2012, which allows and encourages universities inIndonesia to offer study programs in dual modes system and e-learning programs, UniversitasTerbuka is nolonger enjoy the status as the ‘only’ distance education provider in Indonesia. With theavaillability of e-learning programs offered by other ‘conventional’ public and private universities,UT students may at a certain phase of their learning decides to transfer to other universities. Indonesiahas been a potential and promising market for universities abroad. In the long run obviously UT willalso face competitions with similar educational programs from other countries, Information indicatingstudent unwillingness to re-register or taking other study program of the university, besides reducingthe revenues for the university, may also an indication of some problem with the university service.
European Journal of Education and Learning, Vol.12, 2012ISSN(paper)2668-3318 ISSN(online)2668-361Xwww.BellPress.org 11
Student loyalty has a dynamic nature, subjected to many factors, such as perception of quality (Patric,2004), brand image (Beckwith & Lehman, 1975) and satisfaction (Hoyt & Howell, 2011) . Theinfluencing factors are termed as the ‘drivers’ of loyalty (Helgesen & Nesset, 2007). The student perception of the university service quality may influence satisfaction and their loyalty to theuniversity(Helgesen & Nesset, 2007),in the forms of intent to ‘re-register’ or take a higher level of study program offered by the university. University reputation as an overall attitude held by studentsalso has a positive impact on customer satisfaction (Johnson et al., 2001; Oliver, 1997).Students holda certain perception about the university, whether the university has a good reputation or not.Student perception of reputation is very important to attract and retain students (Standifird, 2005).Based on this schema of thinking, this study aims to explore the dynamics of student loyalty, inrelation to program quality, the brand image of the institution, and student satisfaction.
2. Literature Review
Studies of loyalty and customer satisfaction for goods and service is abundant (Zeithaml, Bitner &Gremler, 2006). Structural models to explore customer satisfaction, loyalty and related antecedents,such as product or service quality and brand image have been extensively used. Some principlesderived from these studies will benefit the efforts to market education, and in exploring whether the principles and findings in the business sector are transferable to education domain, or on the contrary,there is a different dynamics in the education sector compared to goods and service in business. Ineducation institution students are the major customers, however it should be understood that other stakeholders such as parents, employers, and the government, also constitute education customers(Marzo-Navarro, Pedraja-Iglesias, & Rivera-Torres, 2005). In this study students become the sourceof data and information.
 Program Quality
Quality is characterized as an overall customer cognitive judgement about the excellence of a productor service across several areas, such as performance, courtesy, reliability, responsiveness, etc. (Petric,2004; Parasuraman, Zeithaml and Berry,1988). Drawing from Parasuraman’ domains of quality, thisstudy uses the concept of ‘program quality’ to include the dimensions of product and service. Thestudent perception of the program quality will likely influence their satisfaction toward the programitself and the university in general, and ultimately it will determine their decision whether todiscontinue or ‘re-purchase’ the service. If they decide to continue using the service, they may plan toreregister for the following semester, take another program, or attend a higher level program in theuniversity. Program qualityincludes indicators related to the learning service typical of distanceeducation program, incorporating Parasuraman’s SERVQUAL factors of empathy, assurance,responsiveness and reliability. In a distance education system, it is imperative for students to havegood learning skills and persistence to study independently and resourcefully. However, these qualitiesalone may not be sufficient for effective learning, since students will also need supportive andcondusive learning environment. In this respects, program quality will incorporate students perceptionof the learning material, the overall learning experience in face-to-face and online tutorials,assessments, the thesis advising, and thesis defence. 
2.2. Brand image
Brand identity for a university refers to how the institution wants to be, and is perceived by prospective students, the existing students, alumni, legislators, and the public (Lawlor, 1998). Toenlarge scope and reach the targeted students, many universities intentionally develop a unique image.The Indonesia Open University builds an image by introducing a motto ‘making higher education
European Journal of Education and Learning, Vol.12, 2012ISSN(paper)2668-3318 ISSN(online)2668-361Xwww.BellPress.org 12
open to all,’which is appealing to prospective students who lack the opportunity to study due to work responsibilities or distance .Brand is also understood as a reputation, the principles and goals the organization aspiring for, andas what an individual may expect when using the services of the organization (MacMillan, Money,  Downing, & Hillenbrand, 2005). The student’s perception of university reputation is very important to attract and retain students (Standifird, 2005). 
2.3. Student Satisfaction
Various definitions of customer satisfaction essentially refer to the judgement of the service performance as pleasurable or disappointing to one’s expectation (Kotler & Keller, 2006; Oliver,1997). In other words, customer satisfaction represents a summary of affective state or a subjective judgement based on the customer’s experiences compared with expectations. In education domain,Elliot and Healy (2001) proposed that student satisfaction is an attitude that results from the evaluationof the students’ experiences regarding educational services.
2.4. Student Loyalty
Customer loyalty in understood in different ways (Lam, Shankar, Erramilli, & Murthy, 2004; Oliver,1997). As an example,Oliver defines customer loyalty as “a deeply held commitment to rebuy or repatronize a preferred product or service consistently in the future, despite the fact that situationalinfluences and marketing efforts having the potential to cause switching behavior” (Oliver, 1997, p.392). whereas Lam et al. (2004) see it as “a buyer’s overall attachment or deep commitment to a product, service, brand, or organization” (p. 294). An educational institution benefits from havingloyal students not only when students are still within the study program, but also long after theycomplete the program. In other words, ‘student loyalty refers to loyalty both during and after astudent’s period of study at an educational institution’ (Hennig-Thurau et al., 2001).
The study aims to test the causal relationship between perceived program quality, university image,and student loyalty.This study employs a two-step confirmatory analysis to test the hypotheses of thetheoretical model shown in Figure 1.Path analysis will be used to test the causal relationship of thevariables. The data was collected using questionnaires incorporating 58 item measures of 4 variables.A four-point Likert scale was used, with a range of 1 as ‘strongly disagree’, and 4 as ‘strongly agree’.The questions were developed based on their experience of learning in a distance education institution.One hundred and eight students graduating from graduate programs at Universitas Terbuka within the period of 2011 returned the questionnaires. Seventy -six percent of the students are male. The meansage of the respondent is 42, with a range of 29 to 60.Measures for variables in the questionnaire include questions based on the indicators. The programquality incorporates statements such as ‘tutors are competent to conduct online tutorials’, ‘face-to-facetutorials are conducted according to the academic schedule’, ‘tutors respond promptly to studentsqueries and difficulties’, ‘the assessment scheme is fair’, ‘the (printed) learning material has sufficientdepth of subtance,’ ‘the learning material is relevant to real problems’, and ‘the thesis advisors givesfeedback not more than a week’. The university image is measured by questions such as ‘UT has adistinctive characteristic compared to conventional universities’, ‘UT is well-known by the society’, ‘Iam proud to be an alumnae of UT’, and ‘UT trains students to be independent and self-initiatedlearners.’ Satisfaction is measured by statements such as, ‘ I am satisfied with the quality of thetutors,’ ‘I am satisfied that I reap more benefit compared to the cost’, and ‘ I am satisfied that learningat UT broaden my perspectives as learners’. The loyalty indicators include statements such as, ‘Ichose to study at UT with a belief it will help me to reach my goal’, ‘If I am offered an option to study

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