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Assessing the effects of perceived value (utilitarian and hedonic) in LCCs and FSCs: Evidence from South Korea

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  • Kim, Yukyoung

Abstract

In the airline industry, passengers choose and buy service based on their perception of which airline delivers better value. Thus, it is important to compare two types of airlines, Low Cost Carriers (LCCs) and Full Service Carriers (FSCs), to measure how much their product or service is worth and the effect of perceived value on passengers' purchase decisions. This study examined the relationship between perceived value, satisfaction, and purchase intention in both FSCs and LCCs. Confirmatory Factor Analysis (CFA) and Structural Equation Modeling (SEM) were performed for data analysis. Our findings reveal that passenger satisfaction in LCCs is affected by hedonic value and utilitarian value, but passengers' future purchase intention is not dependent on satisfaction even when passengers are satisfied. In FSCs, moreover, utilitarian value is not a significant factor for satisfaction and purchase intention. This research provides implications for airline marketers and directions for future research.

Suggested Citation

  • Kim, Yukyoung, 2015. "Assessing the effects of perceived value (utilitarian and hedonic) in LCCs and FSCs: Evidence from South Korea," Journal of Air Transport Management, Elsevier, vol. 49(C), pages 17-22.
  • Handle: RePEc:eee:jaitra:v:49:y:2015:i:c:p:17-22
    DOI: 10.1016/j.jairtraman.2015.07.001
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    References listed on IDEAS

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    1. Wolfgang Ulaga & Samir Chacour, 2001. "Measuring Customer-Perceived Value in Business Markets: A Prerequisite for Marketing Strategy Development and Implementation," Post-Print hal-00485109, HAL.
    2. Kahneman, Daniel & Tversky, Amos, 1979. "Prospect Theory: An Analysis of Decision under Risk," Econometrica, Econometric Society, vol. 47(2), pages 263-291, March.
    3. Chen, Ching-Fu, 2008. "Investigating structural relationships between service quality, perceived value, satisfaction, and behavioral intentions for air passengers: Evidence from Taiwan," Transportation Research Part A: Policy and Practice, Elsevier, vol. 42(4), pages 709-717, May.
    4. Wittmer, Andreas & Rowley, Edward, 2014. "Customer value of purchasable supplementary services: The case of a European full network carrier's economy class," Journal of Air Transport Management, Elsevier, vol. 34(C), pages 17-23.
    5. Yang, Keng-Chieh & Hsieh, Tsui-Chuan & Li, Hendrik & Yang, Chyan, 2012. "Assessing how service quality, airline image and customer value affect the intentions of passengers regarding low cost carriers," Journal of Air Transport Management, Elsevier, vol. 20(C), pages 52-53.
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    Cited by:

    1. repec:eee:jaitra:v:64:y:2017:i:pa:p:77-85 is not listed on IDEAS
    2. repec:eee:tefoso:v:132:y:2018:i:c:p:118-129 is not listed on IDEAS

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