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International Journal of Management and Marketing Research
Vol. 7, No. 2, 2014, pp. 39-56
ISSN: 1933-3153 (print)
ISSN: 2157-0205 (online)
www.theIBFR.com
PATIENT LOYALTY TO HEALTHCARE
ORGANIZATIONS: RELATIONSHIP MARKETING AND
SATISFACTION
Herni Justiana Astuti, Kanazawa University
Keisuke Nagase, Kanazawa University
ABSTRACT
This study examined a model of patient loyalty from the perspectives of relationship marketing and patient
satisfaction. Data were analyzed in two separate but sequentially related stages using structural equation
modeling with partial least squares. Patient satisfaction directly affected loyalty, but it did not mediate the
relationship between relationship marketing and loyalty. Although healthcare providers can increase
patient satisfaction by demonstrating trustworthiness and commitment and by the use of good
communication skills, these factors do not have a significant effect on loyalty despite their overall positive
impact.
JEL: I110, M310
KEYWORDS: Loyalty, Relationship Marketing, Patient Satisfaction
INTRODUCTION
owadays, every company is faced with sustained competitive rivalry and must compete to provide
services that differ from those offered by their rivals. Some companies have realized that even a
very good product is not a guarantee of long-term success (Gronroos, 2007) due, in part, to
constantly increasing customer expectations regarding products. Thus, customers expect the same from all
product offerings, and they are often disappointed.
Service providers include the customer in the product development process to build relationships. If a
relationship impresses the customer, then the relationship is likely to be maintained over the long term
(Gronroos, 2007). According to Sanchez, one of the basic goals of marketing is to determine the values of
the customer and to incorporate them into marketing programs to enhance customer loyalty (Sanchez,
2003). Good relationships between customers and service providers can lead to satisfied customers
(Anderson & Zimmerman, 1993). Overall satisfaction is a significant and direct precursor to loyalty (Bodet,
2008). Based on a previous study, Salgaonkar argued that satisfaction with a core service is important for
overall customer satisfaction and, in turn, for customer loyalty. This also applies to healthcare (Salgaonkar,
2006).
The main goal of service providers is to meet the expectations of their consumers. In the domain of health
services, the “consumer” is the patient, and healthcare providers manage patient expectations to minimize
differences between such expectations and actual experiences (Baker, 1998). Patients seek healthcare to
recover from illnesses and hope to receive good service, which they rate based on a series of variables that
affect their satisfaction, engagement, and, ultimately, loyalty (Baird, 2013).
N
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H. J. Astuti and K. Nagase | IJMMR ♦ Vol. 7 ♦ No. 2 ♦ 2014
Healthcare is a very personal service. In general, patients who visit hospitals or clinics, sometimes
accompanied by their families or relatives, are usually experiencing some degree of emotional and physical
stress. Thus, issues related to the ability to meet the expectations of patients must be considered in the
decision-making processes of service providers (Baird, 2000).
The field of healthcare is unique and cannot be held to the same standards of customer service that apply
to other industries. Indeed, consumer decisions about other services can be avoided or postponed to a future
date, depending on the wishes of the individual. In contrast, this is typically not an option in the health
sector, where avoiding or delaying consumption decision may have serious implications for the health of
the patient, potentially resulting in poorer health or even death. Thus, the factors that determine patient
loyalty will vary from those that pertain to loyalty in other domains (Salgaonkar, 2006).
Every contact between a customer and an aspect of the service system (“service encounters”) presents an
opportunity to evaluate the service provider and the quality of the service, to form an opinion, as well as to
interact with other patients (Salgaonkar, 2006).
Learning about patient loyalty, resulting from direct relationship marketing or from patient satisfaction, is
important for healthcare organizations to sustain their enterprise in the long term. The purpose of this study
was to analyze how subjects develop loyalty to healthcare organizations through relationship marketing and
patient satisfaction. The discussion that follows is divided into three parts. First, it discusses patient loyalty
to a healthcare organization using the data from all of the respondents. Second, the data were analyzed
according to gender, and third, patient loyalty is discussed with reference to the age of respondents.
LITERATURE REVIEW
Loyalty
Customer loyalty is built with great effort by customized marketing programs that position the customer at
the center of all the activities of the company. However, several multidimensional factors contribute to
customer loyalty. Customer loyalty is also determined by the characteristics of the consumers. For example,
some people do not like uncertainty and are very loyal to the first products they use. Others are more
“adventurous” and want to try new products even though they like or are satisfied with previous products.
Originally, brand loyalty and customer loyalty had almost the same meaning. Moreover, several previous
studies that extensively examined brand loyalty for tangible goods served as the basis for a concept of
customer loyalty that now extends to service organizations that typically provide less tangible products
(Gremler & Brown, 1996).
Loyalty is continued use of a product or service and is grounded in attitudes toward the product or service.
The difference between loyal and habitual use relates to the dynamics underlying the selection of a
particular product or service. A loyal buyer is, at some level, engaged in a relationship, whereas a habitual
buyer is indifferently engaging in routine behavior (Knox, 1998). Dick and Basu (1994) treated the concept
of customer loyalty as the relationship between one’s attitude toward an entity (brand, service, store, and
vendor) and one’s patronage behavior. Gremler and Brown identified three separate dimensions of
customer loyalty: behavioral loyalty, attitudinal loyalty, and cognitive loyalty. Behavioral loyalty
was defined in terms of consumers’ behaviors (such as repeat purchases) related to certain brands
over time (Gremler & Brown, 1996).
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Subsequent studies identified two dimensions of customer loyalty, behavior and attitude, and began to
incorporate a more cognitive orientation, reflecting the assumption that a customer who was truly loyal did
not consider alternative products when making the next purchase decision (Gremler & Brown, 1996).
Because of the complex nature of the services and the high level of involvement of patients in interactions
with physicians, the interaction with the provider will be more important than that with the environment in
healthcare settings. Patients come to healthcare settings to recover from illnesses. The core services
provided can create positive physical and psychological reactions to doctors and treatment, which can
increase loyalty (Salgaonkar, 2006). Everything a patient sees, hears, feels, and experiences in a healthcare
setting should instill trust (Baird, 2013).
Relationship Marketing
Nowadays, many service providers employ relationship marketing strategies. Although an old idea,
relationship marketing is considered to be at the forefront of marketing practices for services. Indeed, the
creation of value through business relationships between buyers and sellers is becoming one of the most
discussed topics in the marketing literature (Walter, Ritter, & Gemunden, 2001). This idea was actually
first introduced by Berry in 1983 and has been recognized by Barnes and Gronroos (Berry, 1995).
Generally, consumers who use specific service suppliers for the first time feel uncertain and vulnerable,
and these reactions are likely to be heightened for personal services (Berry, 1995). If a customer has no
intention of establishing a relationship with a company, he or she can switch providers at any time. On the
other hand, if the customer is seeking to establish a relationship, he or she would be willing to purchase the
products or services in question without having to be “forced” to do so (Kumar, Bohling, & Ladda, 2003).
Marketers began to change their views about the importance of relationships with customers because the
creation and reinforcement of such relationships is the basis for profitable growth in the long run. As a
result, relationship marketing quickly changed from a model based on an old-fashioned monologue into
one based on a dialogue intended to build mutually beneficial long-term relationships between an enterprise
and its customers. That is, marketers propose and customers dispose (Sanchez, 2003).
According to Berry, relationship marketing involves the efforts of multi-service organizations to attract,
maintain, and enhance customer relationships. Good service is necessary to maintain the relationship
(Berry, 2002), and the company must improve its services, elevating those that are “just good” to excellent.
Based on Bove and Johnson (2001), who also endorsed the opinion expressed by Dwyer, Crosby, Kumar,
and Dorsch (i.e., that relationship strength and quality can be conceptualized as trust and commitment). I
hypothesized that greater trust and commitment would be associated with a stronger the relationship
between the customer and the service provider. According to Berry (1995), a company can build consumer
trust in three ways: 1) opening lines of communication, 2) guaranteeing their service, and 3) providing a
higher standard for their behavior. Morgan and Hunt (1994) proposed a model in which commitment and
trust are key to the success of a marketing relationship, serving as mediating variables because they
encourage exchange partners to preserve the investment in the relationship, inhibit pursuit of short-term
alternatives, and maintain confidence that partners will not act opportunistically.
Correlation between Loyalty and Relationship Management
According to Gronroos (2007), one approach to business involves creating an attraction between the
customer and a service company that may result in contact that leads to a mutually beneficial relationship.
Such encounters generate services, a process or performance in which the customer is involved and that
can last a long period of time, a short period, or even just a single meeting.
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In accordance with Sanchez (2003), the establishment of a relationship with a customer that leads to
enduring, profitable growth, rather than making a sale, is the central goal of relationship marketing. Sales
are the beginning of an opportunity to turn a buyer into a loyal customer.
Customers who are loyal to a product are happy to help the company encourage others to try and even buy
the company’s products. Sanchez (2003) also noted that brand loyalty is an asset. Without the loyalty of its
customers, a brand is merely a trademark—an ownable, identifying symbol with little value. The loyalty of
its customers renders a brand much more than a trademark.
One increasingly common trend in relationship marketing by service providers, including healthcare
companies such as hospitals and health clinics, is to increase the number of loyal customers by partnering
with customers, suppliers, and other service providers within the same sector. In the healthcare sector, this
trend is driven primarily by the intense competition among organizations (Naidu, Partivar, Sheth, &
Wasgate, 1999). These authors proposed that relationship marketing programs may be more successful
when there is open communication, mutual commitment, operational alignment, and a mutual
understanding of each other’s goals.
In the healthcare business, the customer is the patient. The relationship between patients and healthcare
providers includes the interactions between patients and physicians, nurses, and service personnel.
Communication is an important factor in building a relationship between physician and patient (Ishikawa
et al., 2002). Based on a systematic meta-analysis, Griffin et al. asserted that the success of the physician–
patient interaction is at the heart of medicine (Griffin et al., 2004). This was confirmed by Beck et al., who
found that the physician–patient interaction was a central and essential element of ambulatory care medicine.
They also cited evidence linking specific verbal and nonverbal behaviors to specific kinds of interaction
between ambulatory primary care providers and their patients (Beck, Daughtridge, & Sloane, 2002). Based
on the foregoing, the following hypothesis was proposed:
H1: That relationship marketing and loyalty are significantly positively correlated
Patient Satisfaction
As customer satisfaction refers to a specific evaluation of the overall service provided, it must be assessed
based on the experience during the process of service delivery. According to Kotler (2003), satisfaction
involves feeling happy or disappointed and derives from a comparison between one’s impression of the
performance (or outcome) of a product or service and one’s expectations.
Many researchers have found that consumer satisfaction and patient satisfaction cannot be equated. As
described by Newsome and Wright (1999), marketing-oriented conceptual models do not easily fit or are
simply inappropriate for many common medical scenarios. The differences and the role(s) played by patient
expectations, perceptions, and disconfirmation are not yet fully understood. The authors also said that many
patients experience themselves in relation to a healthcare system, and it is possible that some patients may
simply remain passive and not evaluate the service provided. Williams (1994) reported that patients may
have a complex set of important and relevant beliefs that cannot be expressed in terms of satisfaction.
According to Williams, the results of a satisfaction survey should be interpreted in the context of a number
of assumptions about what the patient really means by “satisfied.” Mpinga and Chastonay (2011) explored
whether patient satisfaction was a health indicator by comparing health status with general patient
satisfaction under the assumption that patient satisfaction may be useful as a health indicator. They
concluded that patient satisfaction can be used as an indicator of health status.
Patient satisfaction with primary care professionals depends on personal characteristics. Age, health status,
and socioeconomic status appear to have the strongest influence on level of satisfaction in this regard
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(Bowman, Herndon, Sharp, & Dignan, 1992). It has also been noted that nurses are good communicators
who spend time with patients and provide adequate information about the patients’ conditions. Jenkinson
et al. (2002) reported that age and overall self-rated health were only weakly related to satisfaction, and
linear regression analyses have shown that the major determinants of patient satisfaction were physical
comfort, emotional support, and respect for patient preferences. Merkouris et al. (2004) compared
quantitative and qualitative approaches to the measurement of patient satisfaction with nursing care and
concluded that a qualitative approach was better able to identify both the explicit and implicit attitudes of
patients than was a quantitative approach. These results were used to evaluate, compare, and monitor
treatments.
Correlation between Relationship Marketing and Patient Satisfaction
Relationship marketing includes how a company relates to its customers and thus involves more than just
communication (Gronroos, 2007). In a competitive environment, marketing should involve efforts to
establish relationships with potential consumers. The relationship between the consumer and the service
provider can last a long time when companies focus on the customer as the center of their activities. Service
providers in the field of healthcare include those involved in serving patients as consumers, such as
managers, doctors, nurses, and administrative staff. In healthcare organizations, patients also interact with
one another. A good relationship between the customer and the service provider can lead to a satisfied
customer.
Anderson and Zimmerman (1993) found that a physician’s perception of the relationship with his or her
patients may be associated with patient satisfaction. In particular, physicians who characterized the patient–
physician relationship as a partnership tended to have more satisfied patients than did those who view the
relationship as controlled by the physician. These findings also indicated that a physician’s sex and number
of years in practice were unrelated to patient satisfaction.
Bowman et al. (1992) assessed the validity, reliability, and utility of the “Patient–Physician Interaction
Scale” (PDIS) in a university-based family practice center. Data were collected at the time of the visit and
1 month later during both health maintenance appointments and visits in response to specific presenting
problems. PDIS scores were correlated with patient assessments of overall satisfaction (P < 0.01), which
demonstrated the criterion-based validity of the measure. The internal consistency (reliability) of the PDIS
was tested with Cronbach’s α, which was consistently >0.80. Given the foregoing, I proposed the following
hypothesis:
H2: Relationship marketing and patient satisfaction are significantly positively correlated
Correlation between Patient Satisfaction and Loyalty
McDougall and Levesque (2000) found that consumer satisfaction was strongly related to the establishment
of loyalty (an average R2 = 0.833 for the four units of service). Fornell et al. (1996) created a model based
on the American Customer Satisfaction Index (ACSI) and found that the ACSI was positively related to
customer loyalty. Gronhold et al, (2000) subsequently developed a model of the European Customer
Satisfaction Index (ECSI) and conducted a pilot test in 12 countries, including Denmark. Customer
satisfaction had a strongly positive effect on the establishment of loyalty (R2 = 0.691, on average). Olsen
(2002) conducted a split-sample survey of households in Norway to examine evaluations of different
seafood products. The authors defined and measured relative attitudes and compared the results to
evaluations of dissimilar or individual products.Their model included satisfaction as a mediator between
quality and repurchasing loyalty. The relationship between satisfaction and loyalty was significant and
positive across products in both the comparative and non-comparative approaches. Based on the foregoing,
I proposed the following hypothesis:
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H3: That patient satisfaction and loyalty are significantly positively related
Patient Satisfaction Mediates the Relationship between Relationship Marketing and Loyalty
Patients who have already been satisfied (i.e., have received and reacted positively to treatment from
physicians and nurses), become committed to (Morgan & Hunt, 1994) communicate well with (Ishikawa et
al, 2002), and are devoted to their healthcare providers. That is, patient loyalty can be a direct result of a
marketing relationship (Sanchez, 2003) or, for new patients, it can emerge as an indirect result of
satisfaction (Merkouris, Papathanassoglou, & Lemonidou, 2004). Based on the foregoing, I proposed the
following hypothesis:
H4: That patient satisfaction mediates the relationship between relationship marketing and loyalty.
DATA AND METHODOLOGY
Research Design
This study was designed to test the associations among relationship marketing, patient satisfaction, and
loyalty as well as to examine whether patient satisfaction mediates the association between relationship
marketing and loyalty to healthcare organizations.
Research was conducted at one hospital (Banyumas Regency Hospital) and two clinics (the Red Cross
Branch of Banyumas Clinic and the Muhammadiyah University of Purwokerto Clinic) in Indonesia.
Questionnaires were distributed to individuals (or the adult representatives of children) undergoing
outpatient treatment at the hospital or clinics.
Operational Definitions of Research Variables and Indicators:
Conceptualization of relationship marketing: according to Berry (2002), relationship marketing refers to
efforts by multi-service organizations to attract, maintain, and enhance customer relationships.
Operationalization of relationship marketing: Morgan and Hunt (1994) proposed a model in which
commitment and trust were key to the success of a marketing relationship. Communication is also an
important contributor to the establishment of a relationship between a physician and a patient (Ishikawa et
al, 2002). Thus, this study examined commitment, trust, and communication skills as indicators in this
regard.
Conceptualization of patient satisfaction: satisfaction reflects the degree to which one feels happy or
disappointed; it results from a comparison between the perceived performance (or outcome) of a product
or service and expectations (Kotler, 2003).
Operationalization of patient satisfaction: Patient satisfaction was defined as the extent to which a patient’s
expectations or needs were adequately met by the service provided. This study used treatment experience,
feelings of happiness or disappointment, and whether respondents would recommend the service to others
as indicators in this regard.
Conceptualization of loyalty: loyalty is the degree to which a customer repeatedly patronizes a service
provider, has a positive attitude toward the provider, and considers using only this provider when a need
for the service arises again (Gremler & Brown, 1996).
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Operationalization of loyalty: patient loyalty is increased by relationship marketing and satisfaction. This
study used the extent to which respondents felt positively about and defended their service providers as
well as repeat patronage as indicators in this regard.
Data Collection
We collected data through questionnaires to patients who had been undergoing treatment in Banyumas
Regency Hospital, Red Cross Clinic Banyumas Branch and Muhammadiyah University of Puwokerto
Clinic. The questionnaires were distributed to respondents at the time of their treatment between 15
February and 15 March 2013. In total, 315 questionnaire sets were distributed. However, only 307 were
completed and returned to the researcher. Three respondents did not complete all questions, and five did
not return their questionnaires.
Data regarding sex, age, education level, and the purpose of medical treatment were obtained. In terms of
age, the largest group of respondents consisted of those aged 17–25 years and the smallest group consisted
of those aged younger than 17 years. There were 122 male respondents and 185 female respondents. In
terms of educational level, the largest group consisted of those who graduated from high school, whereas
the smallest consisted of those who did not complete primary school. Most patients at Banyumas Regency
Hospital saw medical specialists, whereas most patients at the Red Cross Branch Clinic and
Muhammadiyah University Clinic were treated by general practitioners.
Data Analysis
The data were analyzed in two separate, but sequentially related, stages using structural equation modeling
(SEM) with partial least squares (Smart PLS 2.0). I first designed the measurement model (outer model) to
determine the validity and reliability of the indicators of the latent variables. Second, the structural model
was tested by designing the inner model. Once the model was judged to meet the criteria, the next outer
model was tested. During this stage, the relationships among the latent variables were addressed based on
the theoretical assumptions of the study. The structural model of the relationships among the latent variables
was based on the formulation of the research problem or hypothesis. Structural equation modeling (SEM)
involves generalizations and extensions of first-generation procedures, such as principal component
analysis, factor analysis, discriminant analysis, and multiple regressions. The application of certain
constraints or assumptions in SEM allows for more flexibility (Chin, 1998). PLS Path Models were used to
analyze the moderating effects of the variations in the factors that affect the strength or direction of the
relationship between exogenous and endogenous variables (Henseler & Fassot, 2010). In this study, patient
satisfaction was the moderating variable, which may strengthen or weaken the relationship between the
variables of relationship marketing and loyalty.
In designing the measurement model (outer model), measures used for the constructs included convergent
and discriminant validity, composite reliability, and Cronbach’s α. Convergent validity measures the
magnitude of the correlation among the latent variables within a construct by examining the reliability of
an item in terms of a standard loading factor. A correlation can be said to be valid if it has a value >0.7.
Loadings of 0.5 or 0.6 may be acceptable if the research is still at an early stage of developing measurement
scales (Chin, 2010). Discriminant validity, the next evaluation assessed and compared the discriminant
validity and the square root of the average variance extracted (AVE). The model was assessed by measuring
the cross-loading between constructs. When their correlation with each indicator construct is greater than
that with the other constructs, the latent construct indicators are better predictors than are the other
constructs. When the correlation between the latent construct indicator and each indicator construct is
stronger than it is with the other constructs, good discriminant validity has been achieved. The
recommended value is >0.5 (Fornell & Larcker, 1981). Composite reliability values of >0.6 indicate that
the construct is reliable (Bagozzi & Yi, 1988). Cronbach’s α, following a PLS approach: test–reliability
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H. J. Astuti and K. Nagase | IJMMR ♦ Vol. 7 ♦ No. 2 ♦ 2014
was assessed using Cronbach’s α, which assesses the consistency of items. Cronbach’s α is acceptable if α
≥ 0.5.
Designing the structural model (inner model), after the model was judged to meet the criteria for the outer
model, the structural models were tested. This stage assessed the relationship among the latent variables
based on the study’s theoretical assumptions. The design of the structural model of the relationships among
latent variables was based on the formulation of the research problem or hypothesis.
Figure 1: Model of Patient Loyalty to Healthcare Organizations Through Relationship Marketing and
Satisfaction
RM1, 2 & 3 are indicators of Relationship Marketing; PS1, 2 & 3 are indicators of Patient Satisfaction; L1, 2 & 3 are indicators of Loyalty; R2 is
R square of the variables; CV is Convergent Validity (loading factor); PS is the Path Coefficient
The structural model is tested by evaluation of goodness of fit and path coefficients.
RESULTS AND DISCUSSIONS
The model of patient loyalty to healthcare organizations through relationship marketing and satisfaction
was analyzed using structural equation modeling (SEM) with partial least squares (Smart PLS 2.0). We
analyzed the data in three stages. In the first stage, the data were analyzed as a comprehensive dataset. In
the second stage, the data were separated based on gender, and finally, in the third stage, based on age.
Firstly, the outer measurement model can be described as the comprehensive dataset. This measurement
model was considered from a convergent validity (loading factor) perspective; based on table 1, the
convergent validity value was > 0.7, indicating validity. All reported AVEs exceeded 0.5, confirming that
all measures had discriminant validity. The values for composite reliability were >0.6, indicating that the
latent constructs of loyalty, patient satisfaction, relationship marketing, and the construct that mediated
between relationship marketing and patient satisfaction were reliable. The Cronbach’s α values for all latent
constructs were >0.5, indicating that the questionnaire was internally consistent.
Figure 2 shows the structural equation modeling with partial least squares of patient loyalty from the
perspectives of relationship marketing and patient satisfaction. According to Figure 2, it can be seen that
the R2 (evaluation of goodness of fit) of patient satisfaction and loyalty are 0.740 and 0.647 respectively.
The R2 value of 0.740 indicates that 74.0% of the variability in the patient satisfaction construct was
RM 1
RM 2
RM 3
PS 1
PS 2
PS 3
R2
R2
R2
R2
L 1
L 2
L 3
PC
Relationship Marketing
Loyalty
CV
RelMarket*PatSatis
Patient Satisfaction
CV
CV
CV
CV
CV
CV
CV
CV
PC
PC
PC
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explained by relationship marketing. The R2 value of 0.467 indicates that 46.7% of the variability in loyalty
can be explained by relationship marketing, patient satisfaction and also the moderating construct of
relationship marketing and patient satisfaction.
Table 1: Convergent Validity, Discriminant Validity (AVE), Composite Reliability, and Cronbach’s α in
the Comprehensive Dataset
Discriminant Validity (AVE),
Composite Reliability,
Cronbach’s α
Statements of Questioner
Convergent
Validity
(Loading
Factor)
Relationship Marketing
AVE = 0.835
composite reliability = 0.938
Cronbach’s α = 0.900
RM1: The clinic/hospital is always willing to establish an ongoing relationship with
me
RM2
: I entrust therapeutic treatment for a disease that I have experienced on the clinic
/ hospital is
RM3
: The doctors, nurses, and staff at the clinic/hospital are able to communicate well
with me
0.897
0.929
0.914
Patient Satisfaction
AVE = 0.757,
composite reliability = 0.903,
Cronbach’s α = 0.838
PS1: I was satisfied with my treatment at the hospital/clinic
PS2
: The services I received at the hospital/clinic met my expectations
PS3
: If asked about where to get the best treatment, I would recommend the
hospital/clinic
0.912
0.917
0.775
Loyalt y
AVE = 0.660,
composite reliability = 0.853,
Cronbach’s α = 0.749
L1: If you find a hospital/clinic that offers a variety of high-quality services, you do
not switch treatment facilities
L2:
If anyone tried to criticize this clinic/hospital, I would try to defend it
L3
: If the clinic/hospital advised me to undergo a wellness check to evaluate my
progress, I would will return for that
0.777
0.806
0.853
RM: relationship marketing, PS: patient satisfaction, L: loyalty
Figure 2: Structural Equation Modeling with Partial Least Squares of Patient Loyalty as a Comprehensive
dataset
Table 3 describes the path coefficients of the model as a comprehensive dataset (307 samples). The results
reflected positive relationships between constructs (see the original sample). Relationship marketing was
positively related to loyalty (0.218), showing that the relationship between relationship marketing and
loyalty was positive. However, the t-test revealed that relationship marketing had no significant effect on
patient loyalty (1.087). In terms of statistical significance, given that the results of the t test < t table (α =
0.05), then hypothesis H1, that relationship marketing and loyalty are significantly positively correlated,
should be rejected.
RM 1
RM 2
RM 3
PS 1
PS 2
PS 3
0.740
0.000
0.467
0.000
L 1
L 2
L 3
0.496
Relationship Marketing
Loyalty
0.897
RelMarket*PatSatis
Patient Satisfaction
0.929
0.914
0.912
0.917
0.776
0.777
0.806
0.853
0.860
0.219
0.014
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Table 3: Path Coefficients, t Statistics and Results
Relationship
Path
Coefficient
t
Statistic
Result
Relationship marketing → Loyalty
Relationship marketing → Patient satisfaction
Patient satisfaction → Loyalty
RelMarket*PatSatis → Loyalty
0.218
0.860
0.496
0.014
1.087
25.619**
2.748**
0.153
Not accepted
Accepted
Accepted
Not accepted
RelMarket*PatSatis: mediated of relationship marketing x patient satisfaction
** significance at 5 percent
Relationship marketing was positively related to patient satisfaction (0.860), and the t-test indicated that
relationship marketing had a significant effect on patient satisfaction (significance at 5 %). Thus, hypothesis
H2, that marketing and patient satisfaction are significantly positively correlated, should be accepted.
Patient Satisfaction was positively related to loyalty (0.496), and the t-test showed it had a significant effect
on loyalty (significance at 5 %). Thus, hypothesis H3, that patient satisfaction and loyalty are significantly
positively related, should be accepted.
Relationship marketing was positively related to loyalty (0.014) via the variable of patient satisfaction;
however, the relationship was not significant according to the t test value of 0.153. Thus, hypothesis H4,
that patient satisfaction mediates the relationship between relationship marketing and loyalty, should be
rejected.
Clinics/hospitals attract, nurture, and build relationships with patients. The relationship between a
clinic/hospital and a patient can be measured in terms of commitment, trust, and communication. This
relationship had a positive relationship with loyalty, as measured by strongly positive attitudes toward the
institution, willingness to defend it, and repeat patronage. However, relationship marketing had no
significant effect on loyalty. Most respondents in this study were patients who received medication and
treatment at hospitals and clinics that, as state employees, retired state employees, or people below the
poverty line who became government dependents, used medical insurance provided by the government or
universities. As hospitals and clinics remain in the same location, patients typically become regular
customers. The direction of the influence of relationship marketing to loyalty was positive, indicating that
a better relationship between healthcare providers and patients results in greater loyalty; however, this does
not significantly affect attitudes. According to Dick and Basu (1994), a relatively negative attitude coupled
with highly repetitive patronage can be considered “spurious loyalty,” marked by the influence of non-
attitudes on behavior. A loyalist is, at some level, involved in a relationship, whereas a habitual user behaves
in a routine manner and is indifferent about his/her choice. These two types of consumers have different
styles, although both seemingly exhibit behavioral loyalty (Knox, 1998).
A clinic/hospital is always willing to establish a continuous treatment relationship with patients who trust
the facility. Good communication by doctors, nurses, and other parties at the clinic/hospital has a positive
and significant impact on patient satisfaction. Patient satisfaction with the services received from a
hospital/clinic encompasses the treatment experience, feelings of happiness or disappointment (in the
context of expectations), and whether one would recommend the facility to others. The marketing
relationship between healthcare providers and patients can be very important to the latter’s evaluation of
the healthcare provided by the former (Salgaonkar, 2006).
Satisfaction with treatment has a positive and significant impact on loyalty. Patients will show increased
loyalty when they feel a positive connection with a hospital/clinic. However, patient satisfaction does not
significantly mediate the relationship between relationship marketing and loyalty.
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In the second stage, the data were analyzed by gender (122 males and 185 females). Table 4 shows the
measurement of the model by convergent validity. It can be seen that all indicators have a value >0.7, except
PS3 male. However, loadings of 0.5 or 0.6 may be acceptable because the research is still at an early stage
in terms of developing measurement scales (Chin, 2010). All indicators of both genders were therefore
considered valid. In Table 5, all of the outer measurement models can be seen to be acceptable in terms of
the values of AVE, composite reliability and Cronbach’s α.
Table 6 shows the evaluation of goodness of fit by gender. It can be seen that the R square of patient
satisfaction is 0.346 for male and 0.536 for female. This indicated that 34.6% and 53.6% of the variability
in the patient satisfaction construct was explained by relationship marketing for males and females,
respectively. The variability in loyalty, explained by relationship marketing, patient satisfaction and also
the moderating construct of relationship marketing and patient satisfaction, is 46.7% and 77.2% for males
and females respectively.
Table 4: Convergent Validity by Gender
Indicators
Convergent validity of Male
Convergent validity of Female
RM1
0.867
0.907
RM2
0.923
0.932
RM3
0.895
0.921
PS1
0.880
0.923
PS2
0.894
0.928
PS3
0.693
0.798
L1
0.739
0.801
L2
0.850
0.781
L3
0.842
0.855
The recommended value for validity of convergent validity is > 0.7
Table 5: Discriminant Validity (AVE), Composite Reliability, and Cronbach’s α by Gender
Gender
AVE
Composite Reliability
Cronbach’s α
Result
Male
Relationship marketing
Patient satisfaction
Loyalt y
RelMarket*PatSatis
0.801
0.684
0.660
0.578
0.924
0.865
0.853
0.992
0.876
0.765
0.744
0.900
Acceptable
Acceptable
Acceptable
Acceptable
Femal e
Relationship marketing
Patient satisfaction
Loyalt y
RelMarket*PatSatis
0.846
0.783
0.661
0.788
0.943
0.915
0.854
0.971
0.910
0.860
0.751
0.966
Acceptable
Acceptable
Acceptable
Acceptable
The recommended value for validity of Average Variance Extracted (AVE) is >0.5. The recommended value for validity of composite reliability is
>0.6. The recommended value for validity of Cronbach’s alpha is ≥ 0.5
As demonstrated in Table 7, all path coefficients are positive except for the moderating effects, which are
negative for male patients. The most significant relationship is that between relationship marketing and
patient satisfaction for both male and female patients. The results are acceptable for all relationships.
However, there is no moderating effect in patient satisfaction as demonstrated by the t statistics for both
groups of patients.
As the path coefficient of both groups of patients are positive, it can be concluded that the better the
relationship between service providers and patients, the greater the loyalty of both male and female patients.
In other words, relationship marketing has a direct relationship to loyalty based on gender. This study
supports the first hypothesis that relationship marketing and loyalty are significantly positively correlated.
This is consistent with the results of the study by Ndubusi (2006). Patients, both male and female, will be
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H. J. Astuti and K. Nagase | IJMMR ♦ Vol. 7 ♦ No. 2 ♦ 2014
loyal if the service provider is able to attract, maintain, and enhance customer relationships, as described
by Berry (2002).
Table 6: Evaluation of Goodness of Fit by Gender
Constructs
R2 of Male
R2 of Female
Loyalt y
Patient Satisfaction
0.346
0.467
0.536
0.772
R2 is R square
A similar result was seen in the relationship between patient satisfaction and loyalty, although for female
patients the correlation was higher than for male patients. This finding is in line with the loyalty of patients
seen in its entirety and is also consistent with the findings of McDougall and Levesque (2000), Fornell et
al. (1996) and Gronhold et al, (2000). However, patient satisfaction was not found to be moderating the
relationship between relationship marketing and loyalty. Patients can immediately be loyal, following
relationship marketing from the service provider, without having to be satisfied first.
Table 7: Path Coefficients, t Statistic and Result by Gender
Relationship
Male
Femal e
Path
Coefficient
t
Statistic
Result
Path
Coefficient
t
Statistic
Result
Relationship marketing → Loyalty
Relationship marketing → Patient satisfaction
Patient satisfaction → Loyalty
RelMarket*PatSatis
→ Loyalty
0.278
0.805
0.264
-0.110
3.534**
19.231**
1.894**
0.930
Accepted
Accepted
Accepted
Not
accepted
0.126
0.878
0.651
0.052
10.147**
47.029**
4.796**
0.873
Accepted
Accepted
Accepted
Not
accepted
RelMarket*PatSatis: mediated relationship of marketing
×
patient satisfaction. ** Significance at 5%.
In the final stage, the data were analyzed by age (< 17-25 years old (125 samples), 26-46 years old (89
samples), and > 46 years old (93 samples)). Table 8 shows the convergent validity by age. All indicators
meet the requirements, as described below the table. In other words, all indicators based on age were
considered valid. According to Table 9, all of the outer measurement model can be seen as acceptable in
terms of the values of AVE, composite reliability and Cronbach’s α.
Table 8: Convergent Validity (Loading Factor) by Age
Indicators
Convergent Validity for
Patients Aged < 17-25
Convergent Validity for Patients
Aged 26-46
Convergent Validity for Patients
Aged >46
RM1
0.912
0.820
0.761
RM2
0.925
0.890
0.849
RM3
0.905
0.903
0.737
PS1
0.924
0.907
0.771
PS2
0.934
0.892
0.791
PS3
0.792
0.695
0.772
L1
0.797
0.580
0.830
L2
0.889
0.576
0.534
L3
0.873
0.918
0.826
The recommended value for validity of convergent is > 0.7. Loadings of 0.5 or 0.6 may be acceptable because the research is still at an early stage
of developing measurement scales (Chin, 2010)
In Table 10, the R squared (evaluation of goodness of fit) of patient satisfaction and loyalty by age are
shown. The R2 values of 0.446, 0.495, and 0.496 indicate that 44.6%, 49.5% and 49.6% of the variability
in loyalty can be explained by relationship marketing, patient satisfaction and the moderating construct of
relationship marketing and patient satisfaction for patients aged <17-25, 26-45 and >46 years, respectively.
Furthermore, the R2 values of 0.753, 0.667 and 0.509 indicate that 75.3%, 66.7% and 50.9% of the
variability in the patient satisfaction construct can be explained by relationship marketing according to age.
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Table 9: Discriminant Validity (AVE), Composite Reliability, Cronbach’s α by Age
Gender
AVE
Composite Reliability
Cronbach’s alpha
Result
< 17-25 years old
Relationship marketing
Patient satisfaction
Loyalt y
RelMarket*PatSatis
0.835
0.785
0.730
0.732
0.938
0.916
0.890
0.960
0.901
0.861
0.816
0.954
Acceptable
Acceptable
Acceptable
Acceptable
26-46 years old
Relationship marketing
Patient satisfaction
Loyalt y
RelMarket*PatSatis
0.760
0.700
0.503
0.603
0.904
0.874
0.743
0.929
0.840
0.781
0.596
0.917
Acceptable
Acceptable
Acceptable
Acceptable
> 46 years old
Relationship marketing
Patient satisfaction
Loyalt y
RelMarket*PatSatis
0.615
0.605
0.552
0.313
0.827
0.821
0.781
0.700
0.687
0.675
0.602
0.772
Acceptable
Acceptable
Acceptable
Acceptable
The recommended value for validity of Average Variance Extracted (AVE) is >0.5. The recommended value for validity of composite reliability is
>0.6. The recommended value for validity of Cronbach’s α is ≥ 0.5
Relationship marketing had positive and significant influences on loyalty in two age brackets. This result
supports the first hypothesis that relationship marketing and loyalty are significantly positively correlated.
In contrast, for patients over the age of 46 years, relationship marketing had a negative impact and no
significant influence on loyalty. Furthermore, relationship marketing had positive and significant influences
on patient satisfaction in all three age groups. The second hypothesis that relationship marketing and patient
satisfaction are significantly positively correlated can be accepted. There was also a positive and significant
relationship between patient satisfaction and loyalty. This finding supports the third hypothesis. Patient
satisfaction as a mediation between relationship marketing and loyalty was negative for all age groups. This
factor had no significant influence on loyalty, except for patients over 46 years old.
Table 10: Evaluation of Goodness of Fit by Age
Constructs
R2 of <17-25 y.o
R2 of 26-45 y.o
R2 of >46 y.o
Loyalt y
Patient Satisfaction
0.446
0.753
0.495
0.667
0.496
0.509
R2 is R square. y.o is years old
Patients aged less than 17 to 25 years were loyal to their healthcare providers as a result of relationship
marketing, and similarly if they were satisfied. However, satisfaction does not mediate the relationship.
This pattern of relationships affecting loyalty is also found in patients aged between 26 and 45 years. Good
relationships built by the hospital or clinic can make a patient at that age loyal and satisfied with the provider,
without them having to be satisfied with the outcome of their health provision.
On the other hand, relationship marketing for patients aged over 46 years did not affect loyalty. Instead the
relationship showed a negative correlation; the greater the relationship marketing, the lower the loyalty to
healthcare providers, although the degree of influence was not significant. Nevertheless, these patients
were satisfied after receiving relationship marketing. The results related to the mediated relationship
between patient satisfaction and marketing indicated a significant relationship between relationship
marketing and loyalty despite being negative.
According to Yoon et al (2009), more satisfactory decision-making occurred when an individual's ability
was in accordance with the environment demands. The authors add that older adults have greater consumer
experience and expertise and therefore may be more competent in making decisions. In this situation,
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H. J. Astuti and K. Nagase | IJMMR ♦ Vol. 7 ♦ No. 2 ♦ 2014
elderly patients have longer-term interactions with their healthcare providers and must be satisfied before
becoming loyal. Relationship marketing is not a significant direct influence on loyalty, but it does affect it
indirectly through satisfaction.
Table 11: Path Coefficients, t Statistic and Result by Age
Relationship
<17-25 y.o
26-45 y.o
> 46 y.o
Path
Coefficient
t
Statistic
Path
Coefficient
t
Statistic
Path
Coefficient
t
Statistic
Relationship marketing → Loyalty
Relationship marketing → Patient satisfaction
Patient satisfaction → Loyalty
RelMarket*PatSatis → Loyalty
0.368
0.868
0.315
-0.020
6.952**
38.820**
2.212**
0.260
0.079
0.817
0.608
-0.052
7.112**
20.105**
4.072**
0.466
-0.268
0.714
0.631
-0.354
1.134
10.267**
4.980**
2.146**
RelMarket*PatSatis: mediated of relationship marketing x patient satisfaction. y.o is years old. ** significance at 5 %
CONCLUDING COMMENTS
This study examined patient loyalty to healthcare providers and the factors that influence this phenomenon.
Thus, this study extends previous research on loyalty, particularly with regard to healthcare organizations.
This study also evaluated a model of loyalty to service providers that includes three antecedents: the
marketing relationship, patient satisfaction, and the relationship between relationship marketing and loyalty
as mediated by patient satisfaction. Patient loyalty was tested using structural equation modeling by partial
least squares. The data were analyzed in two steps: first, the structural model was tested as an outer model;
second, the inner model was tested. In addition, the data were analyzed in three ways: overall data; by
gender; and by age.
The correlation between relationship marketing and loyalty was positive and significant on both genders,
patients under 17–25 years old and those 25–45 years old. These results support the first hypothesis that
relationship marketing and loyalty are significantly positively correlated. In contrast, for patients over 46
years old, that result was negative and showed no significant effect. When considering the whole dataset,
the relationship between those factors was positive but not significant. In other words, hospitals or clinics
can build good relationships through trust, commitment and communication skills to gain the loyalty of
male and female patients aged up to 46 years. However, patients over 46 years of age were not affected by
relationship marketing.
Relationship marketing and patient satisfaction are significantly positively correlated. This can be seen in
the results for the comprehensive dataset, for gender and age. All patients become satisfied after the
healthcare providers provide relationship marketing. As patients come to a healthcare provider seeking
treatment and, typically, are in a state of pain and/or stress, it is not surprising that the data show that efforts
by doctors, nurses, and other staff involved in healthcare to develop trust, show commitment, and use good
communication skills contribute to an overall positive experience by patients. This pattern of relationship
is similar to the relationship between patient satisfaction and loyalty. However, when looking at patient
satisfaction as the mediation between relationship marketing and loyalty, the influence (though negative)
is only on patients over 46 years old. For the comprehensive dataset and female patients, this relationship
was positive but not significant. For male patients, those under 17 to 25 years old and those aged 25 to 45
years, there was no significant influence and the results were negative.
It can be argued that loyalty to hospitals or clinics can be achieved directly for male and female patients,
patients less than 17 to 25 years old, and those of 25 to 45 years old. Some degree of loyalty can be achieved
by healthcare organizations if they provide services, regardless of the type of patient. For elderly patients,
loyalty can be gained through satisfaction.
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Finally, this research contributes to understanding the importance of the efforts of healthcare organizations
to develop loyalty by focusing on relationship marketing and patient satisfaction. The limitation of this
study is that respondents were localized in one regency and the results may not be representative of the
entire country. Future studies should sample more patients nationally and also examine the difference
between private and government health providers.
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ACKNOWLEDGEMENTS
The authors would like to thank the management of Banyumas Hospital, The Indonesian Red Cross of
Purwokerto Clinic and the Muhammadiyah University of Purwokerto Clinic. The authors also acknowledge
the helpful comments of the two anonymous reviewers.
BIOGRAPHY
Herni Justiana Astuti has been a lecturer of Management Department, Economics Faculty, Muhammadiyah
University of Purwokerto Indonesia since 1998. She teaches marketing management and customer
behavior. She graduated as Bachelor of Economics from Jendral Soedirman University, Indonesia in August
1996 and graduated as Master of Sciences in Marketing Management from Jendral Soedirman University,
Indonesia in August 2006. Now, she is studying a doctoral program in Healthcare Management and Medical
Informatics at the Graduate School of Medical Sciences, Kanazawa University Japan. She obtained a
scholarship from the Ministry of Education of Indonesia for her master’s degree and also for the doctoral
program. During her time as a lecturer, she served as head of the Marketing Management Diploma Study
Program from 2001 to 2004 and for the undergraduate Management Study Program from 2009 to 2011.
She can be contacted at the Graduate School of Medical Sciences (Doctoral Course), Kanazawa University,
herni99@gmail.com .
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H. J. Astuti and K. Nagase | IJMMR ♦ Vol. 7 ♦ No. 2 ♦ 2014
Keisuke Nagase M.D.,Ph.D. has been a Professor of Healthcare Management, Medical Informatics and
Medicine in University Hospital, Kanazawa University since 2008. He teaches healthcare management
including behavior changes of physicians with computer systems, patient behavior in choosing hospitals
and medical informatics. He was awarded M.D. from Tsukuba University in March 1991, and Ph.D. from
Tsukuba University in March 1997. He is a board certified specialist in respiratory medicine (Japanese
Respiratory Society).
Prior to join Kanazawa University, he was an associate professor in Kyoto University and Tsukuba
University (Medicine and Medical Informatics). Besides teaching and research in medical informatics and
healthcare Management, he also oversees the hospital information system and administration of hospital
operation as Director of Hospital Corporate Management. He is a councilor of the Japan Society of
Healthcare Administration. He is interested in the behavior of healthcare consumers and physicians
interacting together with market information. Intervention with information systems and learning behavior
are also within his research interests. He can be reached at Healthcare Management, Medical Informatics
and Medicine University Hospital, Kanazawa University, 13-1 Takara-machi, Kanazawa, Japan
920-8641, knagase@staff.kanazawa-u.ac.jp.
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