INFLUENCE OF SERVICE AND SATISFACTION TOWARDS CUSTOMER’S LOYALTY: A STUDY IN STATE-OWNED ISLAMIC BANK IN MAKASSAR, INDONESIA

Abstract

The number of Islamic bank in Makassar keeps increasing. The bank grows rapidly because of some competitive advantages it offers. In order to provide prime service for their customers, Islamic banks are supposed to improve their quality of service. Otherwise, customers may choose to save their money in other banks. Service quality is essential ijn order to survive business competition and maintain customer’s loyalty. The purpose of the study is: 1) evaluate and analyze the influence of quality of service towards customer’s loyalty and 2) evaluate and analyze the influence of satisfaction towards customer’s loyalty. The setting of the study was 4 (four) Islamic banks in Makassar. The population was 200 state-owned Islamic bank customers in Makassar. The study was primary study. The data analysis method was SEM (Structural Equation Model). The findings showed that first, the quality of service had direct and non-significant influence towars customer loyalty and second, customer satisfaction has direct and significant influence towards customer loyalty.