The Impact of Internal Marketing On Service Quality, Perceived Value, Consumer Satisfaction and Loyalty in The Service Sector
The Impact of Internal Marketing On Service Quality, Perceived Value, Consumer Satisfaction and Loyalty in The Service Sector
The Impact of Internal Marketing On Service Quality, Perceived Value, Consumer Satisfaction and Loyalty in The Service Sector
ABSTRACT: This article proposes to integrate internal marketing, perceived quality, perceived value, satisfaction and behavioural
intention in the same model. The study was conducted with 200 healthcare staff and 200 patients. First, the results indicate the
influence of internal marketing dimensions on perceived quality and satisfaction. In a second step, it turns out that perceived
quality influences satisfaction and perceived value, which in turn impacts satisfaction. Finally, there is a relationship between, on
the one hand, satisfaction and behavioural intention and, on the other hand, the perceived value and behavioural intention of
consumers.
I. INTRODUCTION
One of the goals of marketing is to satisfy consumers. Indeed, for the latter, the value of a product lies in its ability to satisfy
their needs. Whether it is for manufactured goods or services, consumer needs are satisfied by various attributes of the offer.
However, given the simultaneous nature of the production and consumption of services, combined with relatively closer contact
with consumers, it can be said that the marketing and management of services has a unique and particular character.
Indeed, in the service sector, the interaction between the employee and the customer is crucial for the experimentation of
the service offer [1]. From this perspective, contact employees play an important role in customer satisfaction. It is attested that
the quality of service, the efficiency of distribution, the efficiency of communication depend directly on contact employees.
Thus, greater attention to employee-customer interactions can result in improved perceptions of service quality, customer
satisfaction and the purchase intent of service customers.
Highlighting the importance and involvement of employees in the marketing of services refers to internal marketing. Indeed,
internal marketing is a management philosophy and a set of activities that consider employees as internal customers and jobs as
internal products. It then strives to offer internal products to satisfy the needs and desires of internal customers, while meeting
the organization's objectives [2]. From this perspective, internal marketing has as its main objective the development of
customer-oriented staff, and focuses primarily on employee development by emphasizing the importance of recognizing their
contribution.
Perceived value is undoubtedly one of the key marketing themes. Its importance is recognized both in the business world and
in the academic world. In the business world, perceived value is a source of competitive advantage and profit because it is linked
to marketing variables such as satisfaction [3]. Moreover, it is strongly linked to consumers' purchasing intentions. In the
academic world, the abundance of research testifies to the importance of the subject.
Although perceived value and internal marketing are recognized as important in explaining consumer satisfaction, no
research attempts to integrate these two concepts into a single model. Thus, the objective of this research is to combine
perceived value, perceived quality and internal marketing in a single model to explain consumer satisfaction and behavioural
intent in the context of services. On the theoretical level, the aim is to compensate for the relative shortcomings revealed in the
current literature. A deepening of the too few if not almost non-existent studies around a satisfaction model integrating at the
same time perceived value, quality and internal marketing is necessary. Moreover, in the healthcare industry, despite the
potential importance of the concept, it is largely neglected in the strategic considerations of healthcare providers.
Methodologically, it is interesting to investigate in other fields as well as other cultures to improve the validity of research
around these constructs.
A. Internal marketing
The concept of internal marketing originated in the 1970s [4]. Since then, the concept has become more and more important
in research and is increasingly adopted and exploited within companies. From an internal marketing perspective, organizations
need to view their employees as internal consumers [4]. According to this principle, internal marketing is more important than
conventional external marketing [5]. In this sense, it must precede external marketing as the key to service excellence and
successful external marketing [6].
Indeed, in service companies, front-line employees are essential to the success of organizations because they are in direct
contact with external clients. As a result, they have a significant impact on the quality of service provided and customer
satisfaction [7]. The growing recognition of the importance of the role of employees in the service industry has led service
organizations to adopt internal marketing [7]. In order to encourage employees to provide excellent service to the external
customer, organizations must treat employees as internal customers and thereby satisfy their needs. In this sense, internal
marketing can be used to change employees' attitudes and behaviours. In addition, it can improve organizational commitment,
task participation, motivation, and job satisfaction of employees [4].
In the literature, there is no consensus definition of internal marketing, sometimes it is defined as a philosophy, sometimes as
a method, and sometimes as a process. From the first perspective, [2] define it as a management philosophy and set of activities
that consider employees as internal customers and jobs as internal products. Internal marketing strives to offer internal
products to satisfy the needs and desires of internal customers, while meeting the goals of the organization. According to the
second perspective, it is a method that organizations successfully use to hire, retain, and motivate employees to provide better
service to customers [6]. It is defined as the process of attracting, developing, motivating, and retaining skilled employees
through internal (job-related) products that meet their needs [8].
Like its definition, there is no consensus on the dimensions that make up internal marketing. While Tansuhaj et al. [2] support a
five-dimensional concept: recruitment, training, motivation, communication and employee retention, Huang et al. [4] advance
three dimensions: internal communication, training and internal market research. Other conceptions of internal communication
include a two-dimensional concept that integrates formal and informal internal communication [9].
B. Perceived quality
Perceived quality has always been at the center of marketing research, both in the corporate and academic worlds. In the
business world, it is recognized as important in the commercial success of the company and in the search for competitive
advantage. In fact, it has an impact on the costs and financial performance of the company. Particularly, in healthcare services,
patients' perception of the quality of services is a key determinant of the provider's success because of its main role in patient
satisfaction [3]. As far as the academic world is concerned, perceived quality is one of the themes most mobilized by marketing
researchers in recent years.
Despite the importance of quality in the marketing literature, it is difficult to find a universal definition of the concept. For
some, it is defined as the customer's perception of the overall quality or superiority of a product or service in relation to its
intended use, in comparison with the alternatives available. While for others, it refers to an overall evaluation of the service that
results from a comparison between, on the one hand, customers' expectations regarding service performance in general and, on
the other hand, the evaluation of this performance for a particular service developed by a given company [10]. Nevertheless, an
analysis of all these definitions brings out the idea of a confrontation between a prior expectation of the consumer and his
impressions of a service. Thus, if the quality of the service provided exceeds expectations, the perceived quality is high, on the
other hand, if it is below expectations, the perceived quality is low.
C. Satisfaction
For many years, satisfaction has been a key marketing concept for both the business and academic worlds. In the corporate
world, it is part of a strategic perspective because it is strongly linked to post-purchase consumer behaviors such as loyalty [11].
In particular, in the context of healthcare services, patient satisfaction could be manifested through positive word-of-mouth and
have a positive impact on the financial results of the institution [3]. In addition, it influences the outcome of medical practices
[12]. For these reasons, patient satisfaction measurement is an integral part of the strategic processes of healthcare
Although the link between perceived quality and satisfaction has been the subject of numerous investigations, a question
remains unresolved as to the place of both in the link. Perceived quality is sometimes presented as an antecedent to
satisfaction, and sometimes it results from satisfaction [11]. In the present research, we align ourselves with the idea that
quality is an antecedent to satisfaction [18]. Hence the following hypothesis:
H4: Quality positively influences satisfaction.
Value is at the heart of what consumers look for in an exchange [19]. Although there is no consensual definition of value, it
can be understood as the consumer's subjective perception of the value of an activity or object, taking into account the benefits
Perceived value
Ha
H8
Internal marketing H6
Hb Behavioural
Service training Satisfaction
Performance intention
H7
incentives
Vision H4
Hc
Perceived quality H5
IV. METHODOLOGY
This part presents the measuring instruments for each of the constructions. Sampling and data collection, as well as the
method of analysis are presented.
A. Measures
The measurement scales used are all taken from the literature. We have adapted them according to the context of the study.
The items for internal marketing are initiated by Tsai and Tang [6],. Quality measurement is adapted from Wu [21], perceived
value, satisfaction and behavioural intention are inspired by the work of [3]. Table 1 illustrates the different definitions used for
each construct.
B. Subjects and procedure
Prior to data collection, the questionnaire was pre-tested with 10 caregivers and 10 patients. The final version of the
questionnaires was then administered face-to-face. The questionnaire on internal marketing was distributed to 200 health
workers (doctors and nurses) in public and private hospitals in Madagascar. The questionnaire on perceived quality, perceived
value and satisfaction was distributed to 200 patients. According to Janssens et al. [22], to ensure the reliability of a structural
equation model, the number of responses must be 5 to 10 times higher than the number of items. In this research, the scale
with the highest number of items is the scale relating to the training program. The minimum number required to validate the
scale is at least 35 responses, i.e. 5 times the 7 items. Loehlin [23], for his part, puts forward the idea of a sample of 100 to 200
individuals, and concludes that the model behaves correctly if the sample size meets this condition. Given these methodological
recommendations, the difficulties related to both the survey and the availability of individuals to be questioned, and the length
of our questionnaire, we interviewed 200 individuals.
C. Statistical analysis
The data obtained are processed with SmartPLS 3 software. First, the measurement scale was tested, then a modeling under
structural equation allowed to test the hypotheses put forward.
V. RESULT
After presenting the reliability and validity tests of the measurement scales, this section discusses the results of the structural
model test.
A. Measurement model
Before testing the structural model, the reliability, convergent and discriminant validity of the constructs must be established.
The reliability test gave results greater than 0.7 (between 0.714 and 0.975), an acceptable threshold according to Nunnally
and Bernstein [24], which confirms the reliability of the measurement scales used [25]. Concerning the validity test, Bagozzi and
Yi [26] suggest that convergent validity is ensured by λ above 0.7. Table 2 shows that all of the λ are above their
recommendations. Furthermore, the mean extracted variances (AVE) are greater than 0.5, which makes it possible to establish
the convergent validity of the constructs [25]. With regard to discriminant validity, it is established when the square root of the
mean extracted variance (AVE) is greater than each of the correlations between constructs [25]. The results in Table 3 show that
the conditions for discriminant validity are met.
B. Structural model
To evaluate the structural model, the coefficient of determination (R2) of each dependent variable, the structural coefficients
(β) and the level of significance (t-value) were examined. The values of R2 are above the recommended threshold of 0.10
(between 0.504 and 0.731) [27].
This study was initiated to examine the relationship between the dimensions of internal marketing, perceived quality,
perceived value, satisfaction and intentions. The results in Table 4 show that all three dimensions of internal marketing
positively impact perceived quality and satisfaction (β = 0.545, ρ <0.005; β = 0.449, ρ <0.005; β = 0.659, ρ <0.005; β = 0.229, ρ
<0.005; β = 0.316, ρ <0.005; β = 0.173, ρ <0.05). Therefore, H1a, H2a, H3a, as well as H1b, H2b and H3b are confirmed. In
addition, perceived quality has a positive impact on satisfaction (β = 0.413, ρ <0.005). As a result, H4 is confirmed. Similarly,
perceived quality positively impacts perceived value (β = 0.372, ρ <0.005), which confirms H5. The same is true for the impact of
perceived value on satisfaction (β = 0.491, ρ <0.005), therefore H6 is confirmed. Finally, satisfaction and perceived value have a
positive impact on intention (β = 0.855, ρ <0.005; β = 0.372, ρ <0.005), therefore confirming H7 and H8.
VI. DISCUSSION
This study contributes to the current understanding of health care consumer behaviour in two ways. First, it allows us to test a
model that integrates both internal marketing and perceived value in a satisfaction model. In fact, no study has attempted to
integrate these variables in the same model. Second, our study satisfies the need to investigate these models in other cultures
and health care systems.
First, the results show that the more the institution implements service training programs, the more clearly there is a clear
vision of the services provided by the institution, the better the quality perceived by patients. Confirming other investigations
[6], the results of this research imply that, first, internal marketing improves the knowledge and skills of health care staff to
better respond to patient requests. Second, internal marketing increases nurses' willingness to provide high quality services by
creating a vision of the service to be provided, thereby improving the quality of service provided by nurses.
Second, our results confirm the relationship between performance incentives and perceived quality. These results are
contrary to what Tsai and Tang [6] found. One explanation is likely related to the socioeconomic context in which the study was
conducted. Indeed, this research was conducted in Madagascar, one of the least developed countries. In this regard, given the
high unemployment rate combined with difficult employment conditions, the various forms of incentives, especially financial
ones, encourage people to work more.
Thirdly, the dimensions of internal marketing have a significant impact on patient satisfaction. These results confirm other
ideas [7] that by meeting the needs of internal clients, i.e. the needs of the institution's staff, the institution improves its ability
to meet the needs of external clients.
Fourth, the results reinforce the foundation of the causal sequence suggested by the multi-attribute attitude model: cognition
(quality and value) - affect (satisfaction) - conation (behavioural intention).
First, perceived quality significantly impacts patient satisfaction. These results confirm other investigations attesting to the
positive relationship between the two concepts [3]. In such situations, patients will opt for facilities with a high level of quality of
care and service, which therefore seem to be the most able to satisfy their needs. Second, perceived value influences
satisfaction. Thus, if the total value received is greater than the total sum of the sacrifices made by the patient, satisfaction is
achieved. Otherwise, if the total value received is less than the sum of the sacrifices, there is dissatisfaction. Patients expect a
certain level of service at the price they pay. Therefore, health care providers are encouraged to look for ways to reduce the
perceived costs of monetary and non-monetary services and to increase perceived benefits to increase patient satisfaction.
Furthermore, patient satisfaction has a significant relationship with patient behavioural intention. This finding is consistent with
the results of previous studies in which satisfaction plays an important role in behavioural intentions [28]. In this sense,
behavioural intention is based on a willingness to recommend the facility to others, a willingness to inform staff of the benefits
of the hospital and a willingness to consider it as a first choice in the future.
VII. MANAGERIALIMPLICATIONS
In addition to the theoretical impacts, our results also have implications for health care institutions. First, the service climate
determines the behaviour of individuals by influencing their thinking and perceptions about certain aspects of their
environment. As a result, the service climate relative to the organization can influence and regulate employees' attitudes and
behaviours towards clients. In addition, internal marketing improves service quality through the service climate in question.
Dimensions of internal marketing such as service training help to foster the service climate. From this perspective, an investment
in staff training is necessary. Updates in job-related techniques are certainly essential, but also other training such as
communication and emotion management in order to improve not only the quality of service offered to patients, but also the
relationship between staff.
Secondly, the company's vision, especially the service excellence to which the company aspires, must be effectively
communicated to all staff. This leads employees to have a coherent and collective vision of the company's strategic as well as
operational direction. In addition, it is essential that employees are aware of what they can do to contribute to the success of
the organization. Thus, seminars, annual conferences, regular meetings between managers and employees must be set up.
Thirdly, it is essential that the company creates a work environment where employees feel motivated, leading them to focus
more on customers. In order to achieve this, as a first step, systems are needed that motivate and contribute significantly to
improving the organization's service quality. As well as surveys for consumers, not only for consumers, employees must also be
surveyed for satisfaction on a regular basis. As a second step, staff rewards should be reviewed and modified based on the
organization's performance. In addition, a reward system could be developed to encourage employees to share their ideas to
improve the organization's operations. Rewards need not be purely financial; other forms of rewards may be more effective.
Such actions can create an environment in which employees see tangible results from their efforts.
Fourth, it is recommended that the organization strive to implement staff suggestions wherever possible. In addition, as a
result of staff surveys and suggestions, management should provide feedback on employee suggestions (within a suitable
timeframe). By listening to its employees and acting on their ideas and suggestions, the organization makes them feel valued
and improves their involvement and motivation.
Finally, regarding perceived quality; it is important to reassure patients that they will receive the desired level and quality of
services when they are admitted to the facility. Providers should be attentive to the dimensions of perceived quality (tangibility,
reliability, helpfulness, assurance, empathy).
First, the overall appearance of the hospital facilities and staff provides some tangible clues about the quality of services that
patients can expect. One of the basic expectations of patients is probably the assurance of being in good hands. The sense of
assurance is best conveyed by the skills, professionalism, commitment and efficiency of the staff. Thus, staff must demonstrate a
high level of competence in every interaction and exchange with patients.
Patients also expect accurate responses at all stages of care. Staff need to be precise in their responses about diagnostic
results, treatment procedures that the patient should follow, etc. Communication with patients requires special attention from
health care facilities. Not only must there be open communication with patients, but also listening to them. Staff responsiveness
is also required. Staff need to be more responsive and respond quickly to patients' needs. Indeed, there appears to be a
relationship between waiting time and patient satisfaction [28].
Concerning helpfulness and empathy. A new type of relationship between caregiver and patient needs to be established.
Apart from treating patients with courtesy, all dimensions of the person must be taken into consideration, but not only the
patient aspect or the exclusively medical treatment of the disease. Caring for the whole person includes not only physical
treatment, but also emotional and psychological support from the caregivers. In this respect, beyond the perceived quality
aspect, an empathetic demonstration of care by the caregivers influences the outcome of the treatment in question [12]. In this
respect, empathy is manifested by taking into account patients' lifestyles in the treatment plan in order to personalize and
individualize care.
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