Extensions on the conceptualization of customer perceived value: insights from the airline industry

Purpose – The purpose of this paper is to test and compare different conceptual approaches for perceived value in a service context.Design/methodology/approach – Perceived value is an outcome construct that results from various benefits received and sacrifices devoted to achieve a particular exchange of a service. The paper compares three different modeling approaches (Type 1, Type 2, and Type 4) for perceived value using data from an in‐flight survey. The questionnaire covered topics such as perceived service quality and overall satisfaction, price perception, customer value, and customer retention.Findings – The theoretical discussion repeatedly emphasizes that only the formative modeling of perceived value fits the arguments put forward in the existing literature. This study replicates and extends a study by Lin et al. in the airline service context. The paper reports details about the impact of the proposed seven “get” and “give” components, together with an analysis of the consequences perceived valu...

[1]  R. Lennox,et al.  Conventional wisdom on measurement: A structural equation perspective. , 1991 .

[2]  Detmar W. Straub,et al.  Specifying Formative Constructs in Information Systems Research , 2007, MIS Q..

[3]  Brock Smith,et al.  The destination product and its impact on traveller perceptions , 2000 .

[4]  Mary Jo Bitner,et al.  Evaluating service encounters: The effects of physical surroundings and employee responses. , 1990 .

[5]  Judy A. Siguaw,et al.  Formative versus Reflective Indicators in Organizational Measure Development: A Comparison and Empirical Illustration , 2006 .

[6]  A. Diamantopoulos.  Formative indicators: Introduction to the special issue , 2008 .

[7]  J. Edwards.  Multidimensional Constructs in Organizational Behavior Research: An Integrative Analytical Framework , 2001 .

[8]  Josef A. Mazanec,et al.  Exploring Tourist Satisfaction with Nonlinear Structural Equation Modeling and Inferred Causation Analysis , 2007 .

[9]  Donald J. Shemwell,et al.  A cross-sectional test of the effect and conceptualization of service value , 1997 .

[10]  D. Rubin,et al.  Statistical Analysis with Missing Data. , 1989 .

[11]  Carol Saunders,et al.  PLS: A Silver Bullet? , 2006 .

[12]  Peter J. Danaher,et al.  A comparison of question scales used for measuring customer satisfaction , 1996 .

[13]  A. Mattila,et al.  The role of affective factors on perceived cruise vacation value , 2005 .

[14]  R. B. Woodruff,et al.  Customer value: The next source for competitive advantage , 1997 .

[15]  Kurt Matzler,et al.  Dimensions of price satisfaction: a study in the retail banking industry , 2006 .

[16]  Kurt Matzler,et al.  Dimensions of price satisfaction: a replication and extension , 2007 .

[17]  T. Brown,et al.  Confirmatory Factor Analysis for Applied Research , 2006 .

[18]  Edward E. Rigdon,et al.  Experiential value: Conceptualization, measurement and application in the catalog and Internet shopping environment. , 2001 .

[19]  Gilbert A. Churchill,et al.  An Investigation into the Determinants of Customer Satisfaction , 1982 .

[20]  John R. Rossiter,et al.  The C-OAR-SE procedure for scale development in marketing , 2002 .

[21]  Adamantios Diamantopoulos,et al.  The error term in formative measurement models: interpretation and modeling implications , 2006 .

[22]  Stephen L. Vargo,et al.  Service-dominant logic: continuing the evolution , 2008 .

[23]  J. Petrick.  The Roles of Quality, Value, and Satisfaction in Predicting Cruise Passengers’ Behavioral Intentions , 2004 .

[24]  Scott B. MacKenzie,et al.  Common method biases in behavioral research: a critical review of the literature and recommended remedies. , 2003, The Journal of applied psychology.

[25]  H. Winklhofer,et al.  Index Construction with Formative Indicators: An Alternative to Scale Development , 2001 .

[26]  William B. Dodds,et al.  Effects of Price, Brand, and Store Information on Buyers’ Product Evaluations , 1991 .

[27]  M. Holbrook.  The Nature of Customer Value: An Axiology of Services in the Consumption Experience , 1994 .

[28]  A. Zins.  Relative attitudes and commitment in customer loyalty models , 2001 .

[29]  J. Petrick,et al.  An Examination of the Construct of Perceived Value for the Prediction of Golf Travelers’ Intentions to Revisit , 2002 .

[30]  Cheryl Burke Jarvis,et al.  A Critical Review of Construct Indicators and Measurement Model Misspecification in Marketing and Consumer Research , 2003 .

[31]  C. Saunders,et al.  Editor's comments: PLS: a silver bullet? , 2006 .

[32]  Richard A. Spreng,et al.  Modelling the relationship between perceived value, satisfaction and repurchase intentions in a business‐to‐business, services context: an empirical examination , 1997 .

[33]  Marko Sarstedt,et al.  PLS-SEM: Indeed a Silver Bullet , 2011 .

[34]  C. Fornell.  A National Customer Satisfaction Barometer: The Swedish Experience: , 1992 .

[35]  Rudolf R. Sinkovics,et al.  The Use of Partial Least Squares Path Modeling in International Marketing , 2009 .

[36]  R. B. Woodruff,et al.  Know Your Customer: New Approaches to Understanding Customer Value and Satisfaction , 1996 .

[37]  James C. Anderson,et al.  Monte Carlo Evaluations of Goodness of Fit Indices for Structural Equation Models , 1992 .

[38]  Marko Sarstedt,et al.  Customer Satisfaction with Commercial Airlines: The Role of Perceived Safety and Purpose of Travel , 2011 .

[39]  J. J. Cronin,et al.  Assessing the effects of quality, value, and customer satisfaction on consumer behavioral intentions in service environments , 2000 .

[40]  J. Hair.  Multivariate data analysis , 1972 .

[41]  Kurt Matzler,et al.  Measuring the Relative Importance of Service Dimensions in the Formation of Price Satisfaction and Service Satisfaction: A Case Study in the Hotel Industry , 2006 .

[42]  P. J. Sher,et al.  Past progress and future directions in conceptualizing customer perceived value , 2005 .

[43]  David F. Midgley,et al.  Formative versus reflective measurement models: two applications of formative measurement | NOVA. The University of Newcastle's Digital Repository , 2008 .

[44]  G. Soutar,et al.  The Role of Perceived Risk in the Quality-Value Relationship: A Study in a Retail Environment , 1999 .

[45]  William J. Havlena,et al.  The Varieties of Consumption Experience: Comparing Two Typologies of Emotion in Consumer Behavior , 1986 .

[46]  R. Oliver.  Satisfaction: A Behavioral Perspective On The Consumer , 1996 .

[47]  Amit K. Ghosh,et al.  Service value determination: an integrative perspective. , 1996 .

[48]  P. Lachenbruch.  Statistical Power Analysis for the Behavioral Sciences (2nd ed.) , 1989 .

[49]  S. Geisser.  A predictive approach to the random effect model , 1974 .

[50]  James F. Petrick,et al.  Development of a Multi-Dimensional Scale for Measuring the Perceived Value of a Service , 2002 .

[51]  Wynne W. Chin.  Issues and Opinion on Structural Equation Modeling by , 2009 .

[52]  Rosa M. Rodríguez,et al.  Perceived value of the purchase of a tourism product , 2006 .

[53]  Qing Hu,et al.  Assimilation of Enterprise Systems: The Effect of Institutional Pressures and the Mediating Role of Top Management , 2007, MIS Q..

[54]  David C. Bojanic,et al.  A Structural Analysis of Value, Quality, and Price Perceptions of Business and Leisure Travelers , 2000 .

[55]  Kenneth A. Bollen,et al.  Structural Equations with Latent Variables , 1989 .

[56]  Stephen L. Vargo,et al.  Evolving to a New Dominant Logic for Marketing , 2004 .

[57]  Nick Bontis,et al.  User acceptance of wireless short messaging services: Deconstructing perceived value , 2007, Inf. Manag..

[58]  Nathan P. Podsakoff,et al.  The Role of Formative Measurement Models in Strategic Management Research: Review, Critique, and Implications for Future Research , 2006 .

[59]  Barbara L. Gross,et al.  Why we buy what we buy: A theory of consumption values , 1991 .

[60]  C. Fornell,et al.  Evaluating structural equation models with unobservable variables and measurement error. , 1981 .

[61]  E. Hirschman,et al.  The Experiential Aspects of Consumption: Consumer Fantasies, Feelings, and Fun , 1982 .

[62]  G. Soutar,et al.  Consumer perceived value: The development of a multiple item scale , 2001 .

[63]  Michael Riley,et al.  An Investigation of Perceived Value Dimensions: Implications for Hospitality Research , 2004 .

[64]  Adamantios Diamantopoulos,et al.  Advancing formative measurement models , 2008 .

[65]  R. Bagozzi,et al.  On the nature and direction of relationships between constructs and measures. , 2000, Psychological methods.

[66]  D. A. Kenny,et al.  The moderator-mediator variable distinction in social psychological research: conceptual, strategic, and statistical considerations. , 1986, Journal of personality and social psychology.

[67]  M. Holbrook.  Consumer Value: A Framework for Analysis and Research , 1999 .

[68]  Sajeev Varki,et al.  The Role of Price Perceptions in an Integrated Model of Behavioral Intentions , 2001 .

[69]  Haemoon Oh.  Service quality, customer satisfaction, and customer value: A holistic perspective , 1999 .

[70]  V. Zeithaml.  Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence: , 1988 .

[71]  Ruth N. Bolton,et al.  A Multistage Model of Customers' Assessments of Service Quality and Value , 1991 .

[72]  Steven A. Taylor,et al.  Measuring Service Quality: A Reexamination and Extension , 1992 .

[73]  James C. Anderson,et al.  STRUCTURAL EQUATION MODELING IN PRACTICE: A REVIEW AND RECOMMENDED TWO-STEP APPROACH , 1988 .

[74]  F. Bookstein,et al.  Two Structural Equation Models: LISREL and PLS Applied to Consumer Exit-Voice Theory: , 1982 .

[75]  John Hulland,et al.  Use of partial least squares (PLS) in strategic management research: a review of four recent studies , 1999 .

[76]  Mary Jo Bitner,et al.  The Service Encounter: Diagnosing Favorable and Unfavorable Incidents: , 1990 .

[77]  Dwayne D. Gremler,et al.  Service value revisited: Specifying a higher-order, formative measure , 2008 .

[78]  Measuring cruise passengers' perceived value. , 2003 .

[79]  M. Stone.  Cross‐Validatory Choice and Assessment of Statistical Predictions , 1976 .