Comparing the effects of service quality and value-for-money on customer satisfaction, airline image and behavioural intention between full-service and low-cost airlines: evidence from Indonesia

This research examines the effects of value-for-money and service quality on customer satisfaction, airline image, and behavioural intention of full-service and low-cost airline passengers. A total of 229 young passengers departed from an airport in Jakarta, Indonesia, participated in the survey. A variance based Structural Equation Modelling was employed to examine the causal-effect relationships. Results revealed that the behavioural intention of full-service and low-cost airline passengers could not be directly determined from value-for-money and service quality, but they are mediated through the chronological path of customer satisfaction and airline image. Further, for full-service airline passengers, service quality plays an important role to affect behavioural intention, whereas, for low-cost airline passengers, perceived value-for-money is more concerned. Also, the effects of both value-for-money and service quality on airline image were found to be different between these two categories.