The Influence of Product Quality, Customer Trust, and Distribution on Customer Loyalty at CV. Anjari Atha Tanaya: The Mediating Role of Customer Satisfaction
Keywords:
Customer Loyalty, Customer Satisfaction, Customer Trust, Distribution, Fertilizer Industry, Product QualityAbstract
In Indonesia's fertilizer industry, shifting governmental regulations and intensifying competition have forced companies to refocus their strategies for retaining customer loyalty. CV. Anjari Atha Tanaya, a fertilizer producer in East Java, faces declining sales despite ongoing quality improvements. This study investigates the simultaneous influence of product quality, customer trust, and distribution on customer loyalty, with customer satisfaction as an intervening (mediating) variable. Methods: Using a quantitative correlational approach, data were gathered from 95 frequent customers (farmers) across Indonesia through online questionnaires (5-point Likert scale). Structural Equation Modelling-Partial Least Squares (SEM-PLS) was applied using SmartPLS 3.0 to analyze causal paths and mediating effects. Results: Product quality, customer trust, and distribution were found to have significant positive effects on customer satisfaction. However, direct effects of these variables on customer loyalty, surprisingly, were negative and significant. Notably, customer satisfaction positively mediates the relationship between all three independent variables and loyalty, underscoring its centrality. Conclusions: The findings highlight the unique dynamics in Indonesia's fertilizer market: customer satisfaction is paramount for loyalty, while direct improvements in quality, trust, or distribution alone may not ensure customer retention, possibly due to external factors such as subsidies and aggressive competition. Managerial and theoretical implications are discussed.
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