The Effect of Customer Experience and Customer Engagement Through Customer Loyalty On Sales Revenue Achievement at PT United Tractors

THE EFFECT OF CUSTOMER EXPERIENCE AND CUSTOMER
ENGAGEMENT THROUGH CUSTOMER LOYALTY ON SALES

REVENUE ACHIEVEMENT AT PT UNITED TRACTORS
Andrie Permadi, Sukardi Silalahi
Master Program, Swiss German University, Tangerang, Indonesia
Article Information ABSTRACT

Received: 30 August 2021
This study aims to examine and discuss the influence of the quality of
Accepted: 13 September 2021
Customer Experience and Customer Engagement with the mediation of
Published: 15 October 2021
Customer Loyalty which is thought to affect repurchase intention or in other
DOI: 10.33555/embm.v9i1.194
words the achievement of sales revenue as a company performance. The
variables in this study were measured through the dimensions of accessibility,
Corresponding Author: service competence, customer recognition, commitment, customer value,
Andrie Permadi thrust, personalization, consistency, perceived quality and customer certainty
Bekasi, Indonesia to make repeat purchases.
Email: andriepermadi.nr@gmail.com
The number of respondents involved in this study were 200 respondents, all
ISSN 2338-8854 respondents were United Tractors consumers who had purchased products
eISSN 2620-9918
and services from PT United Tractors. This research is a quantitative
approach that uses an instrument in the form of a questionnaire. Research
data were analyzed using SEM (Structural Equation Modeling) analysis
strategy with the help of SPSS and AMOS programs and the results of the
analysis in this study also show that customer loyalty can mediate the effect
of Customer Experience and Customer Engagement on Repurchase Intention
Keywords: Customer Behavior, Customer Engagement, Customer

Experience, Customer Loyalty, Repurchase Intention, Sales Revenue and
Company’s Performance
https://journal.sgu.ac.id/ijembm 2021:9(1), pp.1-17 1

THE EFFECT OF CUSTOMER EXPERIENCE AND CUSTOMER Permadi and Silalahi
1 . Introduction "service failure". CS index can no longer

be relied on as a benchmark for customers
In any industry, it will not be separated from
to become loyalists or not, and now the
the relationship with the name of the
most important thing is how a company can
customer (Customers), B2C Industry, or
create a memorable experience when
even B2B at the end of the process will be
customers use its brand and products, then
closely related to the customer. Business-
with their own customers will tell a
to-business (B2B) customers across
memorable experience. to others, this is
industries transform their business models
what makes the value of a company more
to be more customer-focused and provide
valuable, and this is currently known as
complete customer solutions (deLeon &
"Customer Experience".
Chatterjee, 2017). Therefore, the value of a
customer or a customer is very important
Customer experience is becoming very
and crucial for a company. With the
important for companies as research
importance of customer value, the company
analysts write, company strives to create the
must have a benchmark or a measure that
best customer experience Since 2007, the
can state the value of its customer
average customer experience in the
satisfaction level, and in general, currently,
industries that Ferreter track has gone up
the customer satisfaction level value is
across the board, and the number of truly
expressed by a satisfaction index known as
awful experiences has dropped like a rock
the Customer Survey Index (CS Index),
”- Michael Gazala, Forrester Research
which can be obtained by conducting a
Analyst And Customer experience must be
customer satisfaction survey and it is
a strategic priority "A growing majority of
usually done periodically at least once a
executives believe that better customer
year.
experiences should provide a competitive
advantage for their companies" - Survey by
CS Index describes the level of customer
Harvard Business Review Analytic
satisfaction with the service performance of
Services.
a company-provided to its customers, the
higher the CS Index obtained, it can be
Customer experience is an important driver
concluded that the company's service
of business success and competitive
performance to its customers is good or
advantage (Lemon & Verhoef, 2016) and
very good. Industrial conditions, in general,
has attracted a great deal of attention across
continue to change and develop by the
private and public sectors, business-to-
needs and demands of customers, as well as
customer (B2C) and business-to-business
demands for service performance of a
(B2B) markets, recognizing that “what
company. Previously, a high CS index
people really desire are not products but
illustrated good customer satisfaction, now
satisfying experiences” (Abbot, 1955,
the achievement of a high CS index does not
p.40), practitioners have sought to better
make customers loyalists to the company's
understand customer engagement for some
brands or products.
time (Mccoll-kennedy et al., 2015).
Customer experience is complex, dynamic,
The impact of not being a customer loyalist
and difficult to capture. It is multi-
to the company's brands and products will
dimensional in nature (Lemon & Verhoef,
make customers swinger in choosing
2016) encompassing customer responses to
brands and products according to their
all the interactions they have with a firm,
needs and the impact on the company is not
with resources external to the firm
good because it can cause an influence on
including other customers. Customer
brand recognition and company sales
experience is holistic that involves
revenue if it is not anticipated, and repairs
emotional and social, where the experience
made within a certain period may cause
2 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

is caused by direct or indirect contact experience should become a key focus of

through several touchpoints of contact marketers. Fourth, accurate Customer
between the service provider and the experience measurement requires a multi-
customer (Mccoll-kennedy et al., 2015) method approach and cannot be centered
Customer experience is generally defined as around one single measure such as
something holistic, involving cognitive, satisfaction on NPS, a combination of
affective, emotional, social and physical methods will enable an accurate
customers in direct or indirect contact with understanding of the customer experience
the service provider (Meyer & Schwager, and will prove useful to guide managerial
2011). decision making (De Keyser et al., 2015).
Understanding customer experience and the
The strategic purpose of measuring customer journey over time is critical for
customer experience is to use this the firm, Customers now interact with firms
knowledge to support positive and desirable through touchpoints in multiple channels
customer experiences so that a higher level and media, and customer experiences are
of long-term loyalty is achieved. The firm more social in nature. These changes
can see and consider aspects of service require firms to integrate multiple business
delivery based on positive experiences from functions, and even external partners, in
customers, which then the company creating and delivering positive customer
determines its entire strategy, and the experiences (Lemon & Verhoef, 2016).
company can carry out customer experience
development with a focus on its capabil- 2. Literature Review
ities. Business executives consider one of 2.1. Customer Experience
the success factors of business is customer
experience, which can be defined as direct The company, as a service provider to its
and indirect interactions of customers and customers, will always provide the best
entrepreneurs, which involve emotional, service, that customers will get satisfaction
physical, sensory and social in them (De with the services provided by the company.
Keyser et al., 2015). More importantly, the The measurement of customer satisfaction
relationship of customer experience with can be measured by conducting a
customer value and customer engagement. satisfaction survey and will get a CS Index
A better understanding of customer as a reference to customer satisfaction
experience may lead to direct changes in values against the company. Companies
daily practices and may also induce a must be able to make the customer journey
significant change of long-term strategic a cycle of relationships between the
thinking throughout the organization. company and its customers, customer
satisfaction is often the last goal of the cycle
Four guidelines to help businesses better or process of a company's customer
manage customer experience, First, a CX- journey. In many cases, it is found that
driven practice should be centered on the customer satisfaction is obtained by
individual customer applying a “jobs-to-be- customers because the company can
done” mindset. Companies must examine provide the things requested or expected by
how their customer integrate products and customers and many cases also explain that
services within their daily lives to improve not a few customers who feel satisfied at the
their relevance to these customers. Second, beginning then become dissatisfied because
the scope of the Customer Experience their hopes and desires cannot be fulfilled
program should extend beyond the dyadic by the company.
customer-firms relationship and take a
service ecosystem perspective. Third, the Therefore, companies must be able to build
long-term dynamic nature of Customer holistic relationships and involve more
attitudes from customers on the cognitive,
Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17 3

affective, emotional, social, and physical Customers will get the experience at any
responses, this condition is better known as time and in conditions where the customer
customer experience. It is important for deals "touch" the service or the product,
companies to place customer experience in brand or organization, which is obtained
the cycle or process of the company's both before and after the transaction process
customer journey. Based on its definition, or service from the company. If we look at
customer experience is something that is other perspectives discussed in In one of the
complex, dynamic, and difficult to capture research articles, there are several important
and is a holistic one that involves emotional elements related to customer experience
and social. It is multi-dimensional in nature touch points, which include: atmospheric,
(Lemon and Verhoef, 2016) and the technological, communicative, process,
experience is causes by direct or indirect employee-customer interaction, customer-
contact through several touch points of customer interaction and product interac-
contact between the service provider and tion elements (Stein & Ramaseshan, 2016).
the customer (Mccoll-kennedy et al., 2015). And that is no less important in understand-
Customer experience is created not from ing customer experience, customer
elements that the service provider can experience is formed and formed in a long
control but is created from outside elements and long process in the relationship
that they can control, such as the influence between the company and the customer,
of other customers. From a different there is a cross multiple channel interaction
perspective in one of the articles, it is stated and is formed through the relationship
that there are three key domains which can between functional and emotional clue. To
be mentioned as advance customer be able to measure the level of customer
experience (1) broadening the role of experience, in one of the studies it is
customers in customer experience; (2) explained that they introduce the modern
taking a practice-based approach to conceptual of customer experience as the
customer experience; and (3) recognizing customer experience quality (EXQ) scale,
the holistic, dynamic nature of customer where the concept is described as the EXQ
experience across all touch points and over scale, describing behavioral intention and
time. Often customers make changes recommendation better than Customer
according to their needs, applicable rules Satisfaction with CS Its index (Klaus &
and behavior, these changes will have an Maklan, 2013).The scale measured in the
impact and affect many things, not only EXQ consists of several elements, product
themselves but other customers, stakehold- experience, outcome focus, Moment of
ers and of course the company as a service truth and Peace of mind (POMP).
provider. Therefore, the organization within
the company must be able to adapt to the 2.2. Customer Engagement
changes that occur, the companies must Service performance is often the benchmark
examine how their customers have for companies to determine the extent to
integration with their products and services, which the level of service the company
the company must have good programs to provides to its customers, in traditional
make a sustainable relationship between the measurements it is measured by conducting
customer and the company and for the long customer satisfaction surveys with the
term the company must make Customer customer survey index (CS Index)
experience is one of the key focus of the measurement value, but this measurement
marketing team, all of these things will only pattern has been criticized for failing to
be successful in customer experience capture it. depth of customer response to the
activities (De Keyser et al., 2015). performance of services provided by the
company. A deeper level to determine
customer response by paying attention and

building customer involvement in processes customers to repeat purchases from certain

that involve individual customers and service brands (Bowden, 2009). From the
connect with certain brands, where explanation and literature above, it is
customer engagement is better known as important that companies pay attention to
customer engagement (CE) which is one of customer engagement in their customer
the important components in relationship journey, so that they can more clearly see
marketing. the correlation customer experience with
customer engagement in a process that is
There are different conceptualizations to inseparable as relation management.
define the concept of customer engagement,
where practitioners look at it from an 2.3. Customer Loyalty
organizational perspective and define Customer loyalty has been seen as an
customer engagement as activities that important construct for marketing in a
facilitate repetitive interactions involving company. In general, it can be interpreted
emotional, psychological, or physical that customer loyalty is the strength of the
customers with the company through the relationship formed between the attitude of
brand, whereas academics view from the the individual as a customer and the
perspective of customer intensity in company as a service provider and product
participating with organizational provider. The relationship between them
representatives. and with other customers in can be viewed as a dimension by social
the collaborative knowledge exchange norms and situational factors (Dick & Basu,
process. Customer Engagement as an 1994). Several elements that greatly
activity that describes the intensity of influence the relationship between the two
individual participants as customers with are cognitive, affective, and cognitive,
and in relationships with organizations which cannot be separated from the
consisting of cognitive, emotional, motivational, perceptual, and behavioral
behavioral, and social elements (Vivek, consequences between the customer and
Beatty and Morgan, 2012) customer company relationship.
engagement is advocated particularly from
relationship marketing (RM; Vivek, Beatty, Another reviewer said in his journal,
& Morgan, 2010), and service-dominant (S- Loyalty is also positively influenced by
D) logic perspectives (Brodie, Hollebeek, service expectations and service confirma-
Ilic, & Juric, 2011), which are cantered on tion, satisfaction has a positive influence on
the importance of enduring, co-creative the four self-determined motivational
interactions and relationships amongst dimensions - namely, intrinsic regulation,
value generating stakeholders (Hollebeek, identified regulation, introjection regula-
2011). tion, and external regulation (Söderlund,
2006). Companies can more effectively
In the organizational behavior literature, it recognize and reward more valuable
is also described that involvement has been customers with-out alienating fewer
defined as a task behavior that promotes valuable customers. Companies can obtain
relationships with work and other people authorizations to collect and use individual
that are expressed physically, cognitively, customer information from customers in
and emotionally and can stimulate personal exchange for offering enhanced value
development and increase employee propositions through loyalty programs.
motivation. Described in one literature Loyalty programs can encourage customers
considering the role of affective to give up their personal information in
commitment, calculative commitment, exchange for benefits they will not receive.
encouragement, and involvement of the The quality of the relationship can affect
customer engagement process for new customer loyalty in a business-to-business

(B2B) context, where the quality of the a purchase, it can be due to having
relationship between the customer and the consumed it so that he intends to repurchase
company is a higher construction consisting the same product or service. In general, the
of trust, commitment, satisfaction and definition of repurchase intention is a desire
service quality (Dick & Basu, 1994). or desire that arises in a customer to buy
products and services that he likes and has
The quality of the relationship to customer previously buy it based on the results of
loyalty goes through two levels of evaluation of the suitability of product and
relationship quality: the quality of the service performance with consumer
relationship with supplier employees and expectations (Hellier et al., 2003). There are
the quality of the relationship with the several factors that can influence consumers
supplier itself. The influence of the dimen- in purchase intentions, both internal factors
sions and level of relationship quality on from within customers, namely trust and
customer loyalty. Only the perceived consumer attitudes. towards products and
satisfaction and service quality affect services, and external factors, the attitudes
behavioral loyalty (purchase intention) the of others and the situation of the place of
most extraordinary, only the level of purchase (Kotler, 2008: 242).
organizational relationship quality affects
customer loyalty. The existence of B2B Purchase intention is influenced by the level
customer loyalty will not be much influ- of customer experience, the better
enced by the level of quality of employee experience the customer gets, the greater
relations (Rauyruen & Miller, 2007). the opportunity for interest to make another
Customer loyalty is created from a process purchase. The purchase intention of the
in the company's customer journey after a customer will then become the purchasing
transaction process occurs between the decision process, after the customer gets to
customer and the company, which then know the product, finds out information
results in a relationship between them, related to the product, evaluates alternatives
which will directly or indirectly have that can meet customer needs and then
consequences in the company's marketing makes a purchase decision after
activities. experiencing a positive experience of the
products and services provided by the
2.4. Repurchase Intention company. The decision to make purchases
In a company, especially in the marketing made by customers becomes an activity that
department, one of the core concepts is provides value for the company in the form
customer experience, where CX is used as a of achieving company performance in terms
basis for predicting customer purchase of achieving sales revenue for products and
intentions. The results of one study services from the company.
concluded that only emotional experiences
and social experiences that customers have 2.5. Research Framework
have a significant positive impact on The heavy equipment industry is a B2B
purchase intention (Nasermoadeli et al., industry sector, which in general, customers
2013). The intention to buy back customers can be divided into several groups, namely
is influenced by seven important factors: customers with key account management,
service quality, equity and value, customer medium customers, and retail customers.
satisfaction, past loyalty, expected Each customer has its characteristics and
switching costs and preferred brand (Phillip characteristics in the business process with
et al., 2003). Past purchase loyalty is not the company. Apart from the differences in
directly related to customer satisfaction or existing business processes, there is an
current brand preference. The intention to important thing that the three groups have
repurchase occurs after the consumer makes in common, namely that they are still the

company's customers. Where they as occurs, where the customer gets the benefits
customers, will have the expectation to be of the product and the company gets income
treated the same as customers and for the from the products it sells, that process is
company most importantly for all more we know as the customer journey as a
customers can have the right to get a good process that cannot be separated from the
experience. relationship between the customer and the
company.
Talking about customer experience cannot
be determined and regulated by the The hypothesis that we need to do, this is an
company, because the experience can only important series in the study that we are
be felt by customers and customers can currently doing, namely after the company
express their experience in various forms can get a good customer experience, what
and ways, which of course the company things affect and what things should be
hopes for the form of experience is to considered by the company so that a good
convey positive things to other customers customer experience can ensure it happens.
and continuously. keep doing transactions business transactions that continue to occur
with the company. What the company needs and make the company's performance better
to do so that the expectation of a good in terms of sales achievement. For that we
customer experience can make the company need to examine more deeply after the
good performance, especially in terms of customer experience process is achieved,
sales achievement, this study will be where customers get a good impression of
discussed in this literature. To get started, the company's products and services, how
we must know the understanding and long can this impression be maintained?
connection of customers, customer jour- Will the good impression remain? What
neys, customer feedback, customer satisfac- things the company needs to do so that the
tion, excellent customer service, and cus- impression is there even the customer will
tomer experience itself. After understand- get a much better impression. After the
ing this, it can be studied more deeply by customer gets a good experience for the
analyzing the achievement of a good business transaction that occurs, then the
customer experience which will improve real customer expectations will automati-
company performance in terms of achieving cally increase as well and so on, so that if
sales opinions that will also increase. What we depend on customer expectations, each
touchpoints should be the focus of the com- time these expectations will increase. So
pany so that this can be insight and solution that to keep customer expectations from
to transform the company's business. increasing over time, we must understand
that expectations exist because customers
The first hypothesis we recognize, and we always want to get the best results and
understand the meaning of customers for because of previous expectations the
the company, customer journey, and cus- company has been able to provide, therefore
tomer experiences. Customers are people or the company must be able to manage an
companies who buy and use products or impression. good that has been felt by the
services provided by the company, in the customer by engaging the customer and the
process, and in their journey, customers will company.
feel good or bad impressions when using
the products and services they purchased. With a well-formed engagement, the
Then there is a process that keeps repeating company can convince customers, the
itself from the start of the customer results that will be obtained will always
searching for products, the company doing provide an experience for the customer and
promotion and marketing until the most importantly for customer engagement
transaction or buying and selling process that occurs, the company and the customer

have the same commitment, to jointly make testing existing hypotheses. The object of
improvements and development so that the this research is the repurchase intention of
results obtained are for customers will get a United Tractors service users based on
good impression and for the company, there customer experience and customer engage-
will be business transactions on an ongoing ment felt by customers and influenced by
basis. The hypothesis that will be carried customer loyalty to the company.
out next and the definite relationship of
repurchase intention to company perfor- This study uses quantitative methods,
mance is important, in this study it is where methods that use objective and
assumed that repurchase intention is the statistical measurements are then carried
assurance of customers to continue making out. Mathematical or numerical analysis of
transactions with the company not only at all research data, where data is obtained
the level of desire but already at the stage through questionnaires or surveys or by
where customers make transactions, and manipulating existing statistical data with
this This is the benchmark for the compa- computational techniques. This study also
ny's achievement in measuring its sales focuses on collecting numerical data on a
achievement. Based on the explanation of group of people or explaining certain
the related variables above, the structural phenomena, so that with this quantitative
model of research framework of this method the researcher can identify the
research can be seen in the following factors that most influence the variables that
framework figure. lead to customer purchase intentions. This
research also uses an electronic method
where questionnaires and surveys will be
distributed online or internet survey
methods that are considered effective
applications are currently carried out and
this research is also assisted by a paid
survey application to help researchers
design questions and summarize the overall
results of the questionnaire. This study is
designed with a research structure that is
structured in such a way that the author can
get answers to research questions, the
authors provide the scope of research.
Figure 1. Research Model
3.2. Data Sample
The current study focuses on individual
3. Research Method
analysis, especially those who already
3.1. Type of Study know and conduct business transactions
The method used for this research is with companies Individuals describe in
descriptive quantitative method with a more detail their behaviour and characteris-
probability sampling, where the investiga- tics (age, gender, attitude, religion, etc.)
tion is causality, because the causality According to Bryman (2012), the popula-
relationship between the independent and tion is the universe of units from which the
dependent variables will be tested and they sample is to be selected. It is also defined as
can also be used to look at associations or the total of all elements that share some
relationship between variables (Drummond common set of characteristics that contains
& Murphey-Reyes, 2017). The research I the creation for the objective of marketing
did was to be able to answer the problems research problems (Malhotra, 2017). In this
that currently exist in the company through study, the population will be limited to the

category of United Tractors customers who were obtained for the interval-scaled
have or have transacted with the company, independent variables and dependent
the researcher chose to do non-experimental variables (Sekaran and Bougie, 2010).
research, where the researcher was only Descriptive analysis in this study was
able to manage general variables through carried out by calculating the average value
respondent grouping, selecting respondents (mean) and standard deviation for further
as samples, making a list of questions and categorization based on low, medium and
training interviewers with probability or high categories according to the
random sample (stratified random). categorization technique by Uma (2012).
Because the instrument in this study has a
3.3. Data Sources & Collection scale of 1-5, which means the score of
The Data in this study is primary data, respondents' answers has the lowest value
which is data obtained from research results of 1 and the highest 5, then based on the
direct empirically to the direct or all study categorization rules of Uma (2012).
objects that have been previously deter- Descriptive statistics are useful because
mined. To obtain secondary data needed in they allow you to understand a group of data
research, researchers can perform several much more quickly and easily compared to
data collection techniques. There are just staring at rows and rows of raw data
several types of collection methods for values.
quantitative data, and this study researcher
used Survey or Questionnaires method 3.5. Data Processing Procedures
where information or data collected from Data preparation is a pre-processing step
respondents can use a questionnaire or that involves cleansing, transforming, and
questionnaire as a data collection instru- consolidating data. In other words, it is a
ment which is carried out through direct process that involves connecting to one or
distribution or through intermediaries such many different data sources, cleaning dirty
as web or online media. Research using data, reformatting, or restructuring data,
survey methods can be described as standardizing data formats, enriching
scientific research whose data are collected source data, removing outliers and finally
from a selected sample of the entire merging this data to be consumed for
population. analysis. Most researchers choose to use a
database or statistical analysis program (e.g.
3.4. Data Analysis Technique Microsoft Excel, SPSS, AMOS) that they
Data Analysis is an activity after data from can format to fit their needs and organize
all respondents or other sources have been their data effectively. Once the data has
collected and the data used in this study use been entered, it is crucial that the researcher
quantitative data which means the value of check the data for accuracy. In the research
available data is in the form of numbers or process, one of the most important
calculations, each data set has an exclusive processes is the screening data, the quality
numeric value that is related to each other. of good data analysis is influenced by the
This type of data contains information that quality of the initial data filtering and
can be calculated by statistical and treatment
mathematical calculations.
Descriptive statistics is the process of Pre-test is a questionnaire test on a small
analyzing data with statistical methods by number of samples with the aim of
describing, showing and summarizing raw identifying and eliminating errors in the
data through summary statistics, graph a questionnaire (Malhotra, 2007). In this
table, the goal is to facilitate data analysis. study, a pre-test was conducted on 17
Descriptive statistics such as max, min, samples that met the requirements. For the
means, standard deviations and variances reliability test, Cronbach's Alpha value

obtained from the data analysis process can In this research, we use Two-step Approach
be used as an indicator reference for SEM as the alternative, refer to the previous
consistent research data. Meanwhile, for study by Zhang et al. (2018) as well as
validity, the component matrix of the output suggestion in Wijanto (2015). There are two
factor analysis results is used as an indicator stages of procedure in Two-step Approach:
that shows the distribution of sample data the measurement and structural model
on the formed factors. To process the (Zhang et al.,2018). In the first step, re-
respondent data, researcher use Structural searcher will conduct a measurement model
Equation Modelling (SEM) with AMOS analysis to see the fit towards data. Here,
software. SEM analysis technique is used researcher will confirm whether every
because the complexity of the conceptual latent variable is modelled as a factor that is
model used in this study. Structural standardized based on related observed
Equation Modelling (SEM) defined as variables. The measurement model on SEM
statistical method used to test interrelated uses Confirmatory Factor Analysis (CFA)
relationships among observed variables, (Wijanto, 2015). The next step called the
between measurement and latent variables, structural model analysis. It shows the
with the same basic goal of providing a relationships between the latent variables.
quantitative test of a theoretical model The relationships are usually linear, even
hypothesized by the researcher. More though SEM allows the presence of non-
precisely, various theoretical models can be linear relationship (Wijanto, 2015).
evaluated in SEM, hypothesizing how sets
of variables describe constructs and how 4. Result and Discussion
those constructs are interrelated. This study The results of this study include the results
examines the relationship between online of descriptive analysis of respondents'
reviews and impulsive buying, with the role characteristics and the results of SEM
of browsing and impulsiveness (Zhang et analysis. Descriptive analysis of the charac-
al., 2018). SEM test is conducted to test the teristics of the respondents is used to
relationship of 6 measurement variables describe the characteristics of the
given by reference journal. There are two respondents in terms of gender, age,
major types of variables in SEM, namely education level, the respondent's length of
unobserved (latent) variables and observed
service in his company, the type of
variables. transaction carried out and the last time the
respondent transacted with PT United
Unobserved or latent variables (construct or Tractors. In addition to a descriptive
factors) are variables that cannot be directly analysis of the characteristics of the
observed or calculated, and thus are derived respondents, the data in this study were also
from a collection of observable variables processing by Structural Equation
that are measured using tests, surveys, and Modeling (SEM) Analysis Technique. The
other tools. In this research, the latent results of this SEM analysis are then used to
variable includes Customer Experience, test the effect of customer experience and
Customer Engagement, Customer Loyalty customer engagement on repurchase
and repurchase Intention. While, the intention mediated by customer loyalty.
observed variables, measured, or indicator The number of respondents used in this
variables are a set of variables which are
study were 200 respondents. All respon-
used to define or infer the latent or construct dents are consumers who have purchased
variable. One of the advantages, as men- PT United Tractors products and services.
tioned before, is SEM can help researcher to Based on the results of descriptive analysis
test complex set of regression equations in this study, the following is a description
simultaneously, which often called One- of the characteristics of the respondents
step Approach (Malkanthie, 2019). based on gender, age, education level, last

transaction in PT United Tractors products made a transaction and the respondent's

and services, the last time the respondent length of service in the company:
Table 1. Description of Respondents Characteristics
Characteristics Category Frequency (f) Percentage (%)

Male 157 78.5
Gender
Female 43 21.5
17 - 25 yeras old 23 11.5
26 - 35 yeras old 95 47.5
Age 36 - 45 yeras old 53 26.5
46 - 55 yeras old 27 13.5
> 56 yeras old 2 1.0
Education Under High School 2 1.0
High School 46 23.0
Education
Diploma 32 16.0
Job Experience
Barchelor Degree 120 60.0
< 5 years 97 48.5
6 - 10 years 43 21.5
Job Experience
11 - 20 years 42 21.0
Last Transaction
> 21 years 18 9.0
Purpose
Permintaan Jasa Mekanik 25 12.5
Pembelian Alat Berat 17 8.5
Last Transaction
Pembelian Spare Parts 132 66.0
Purpose
Menghubungi Contact Center 18 9.0
Last Time
Menggunakan Mobile Applikasi 8 4.0
Transaction
1-3 years ago 63 31.5
Last Time in this year (2021) 105 52.5
Transaction 4-5 years ago 6 3.0
> 5 years ago 26 13.0

In SEM analysis, measurement model results of the analysis show that all
testing (CFA Analysis) is used to test the indicators are valid in measuring their
validity and reliability of indicators on each constructs so that all indicators in the CFA
construct. Testing the measurement model model can be used to measure exogenous
on each construct consists of several stages, constructs. The test is continued on the
consist of (1) Construct Validity Testing construct reliability test by looking at the
and (2) Construct Reliability Testing. The CR and AVE values of each construct.
Tabel 2. Construct Validity and Reliability Test Results
Variebel Indikator λ Validitas AVE CR Reliabilitas

Customer CL7 0.864 valid 0.803 0.953 reliabel
Loyalty CL6 0.870 valid
CL5 0.904 valid
CL4 0.921 valid
CL3 0.920 valid
Repurchase RI1 0.920 valid 0.862 0.932 reliabel
Intention RI2 0.941 valid
RI3 0.938 valid
RI4 0.915 valid
Based on data of the analysis in the tables, > 0.7, which means that all constructs have
the results of the analysis show that the met the required composite reliability
AVE values of all constructs have been criteria.
> 0.5 and the CR of all constructs have been

Figure 2. Results of Full Structural Model
Structural model testing is used to test the Structural model fit test in SEM analysis is
research hypothesis. The stages in the done by looking at several criteria of
structural model testing include the Goodness of fit model such as Chi Square
structural model formation stage, the value, probability, df, GFI, AGFI, TLI, CFI
structural model feasibility test and the sig- RMSEA and RMR. The following is a
nificance test of the effect of exogenous summary of the results of the goodness of
variables on endogenous variables. fit model testing after modifications can be
seen in the following table:
Table 3. Goodness of Fit Model
Cut Result Model

Goodness of fit index
of Value Analysis Evaluation
· X2 chi square < 1215,563 205,143 Good Fit
· significancy probability ≥ 0,05 0,125 Good Fit
· RMSEA ≤ 0,08 0,025 Good Fit
· GFI ≥ 0,90 0,912 Good Fit
· AGFI ≥ 0,90 0,889 Marginal Fit
· CMIN/DF ≤ 2,00 1,121 Good Fit
· TLI ≥ 0,95 0,995 Good Fit
· CFI ≥ 0,95 0,995 Good Fit

In SEM analysis, the coefficient of repurchase intention is influenced by other

determination shows the influence of all factors in beyond customer experience,
exogenous variables on endogenous vari- customer engagement and customer loyalty.
ables. The coefficient of determination is
seen from the value of the squared multiple In this study, the customer loyalty variable
correlation. acts as a variable that mediates the indirect
effect of customer experience, customer
Table 4. Coefficient of Determination engagement to the repurchase intention. To
examine the role of customer loyalty in
Variables Estimate mediating the indirect effect of customer
experience and customer engagement on
CL ,465 repurchase intention. then the mediation
RI ,554 effect can be tested using the Sobel test.
The hypothesis used in this test is as

The results of the analysis show that the follows:
value of the squared multiple correlation of
the customer loyalty (CL) variable is 0.465, Ho: Customer loyalty cannot mediate the
indicating that the influence of customer effect of customer experience and
experience and customer engagement on customer engagement on repurchase
customer loyalty is 46.5%, while the intention.
remaining 53.5%. customer loyalty Ha: Customer loyalty can mediate the
variance is influenced by other factors effect of customer experience and
outside of customer experience and customer engagement on repurchase
customer engagement. Furthermore, for the intention.
repurchase intention (RI) variable, the R
square value obtained is 0.554 indicating With a significance level of 5%, Ho is
the large contribution of customer experi- rejected if the p value of the Sobel test result
ence, customer engagement and customer is < 0.05 and Ho is not rejected if the p value
loyalty to repurchase intention is 55.4%, of the Sobel test result is > 0.05.
while the remaining 44.6% variance of
Table 5. Sobel Test Result
Indirect T Statistic P Value Result

Path
CX→ 2,345 0,0085 Significantly
CL→ RI Mediate
CE→ 3,054 0,0011 Significantly
CL→ RI Mediate
The hypothesis in this study was tested testing based on the results of the SEM
based on the results of SEM analysis. The analysis that has been carried out in this
following are the results of hypothesis study:

Table 6. Summary of Hypothesis Testing Results
Hypothesis Original Sample (O) Conclusion

• Path Coef = 0,247
(1) Customer experience has an effects
• T Statistics = 3,511 Accepted
customer loyalty
• P value ***
• Path Coef = 0,510
(2) Customer engagement has an effect on
• T Statistics = 6,932 Accepted
customer loyalty
• P value ***
(3) Customer experience has an effect on • Path Coef = 0,251
repurchase intention • T Statistics = 3,740 Accepted

• P Value = ***
(4) Customer engagement has an effect on • T Statistics = 2,345
Accepted
repurchase intention • P Value = 0,0085
(5) Customer loyalty has an effect on • T Statistics = 3,806
Accepted
repurchase intention • P Value ***
(6) Customer loyalty can affect customer • T Statistics = 2,345
Accepted
experience on repurchase intention • P Value = 0,0171
(7) Customer loyalty can affect customer • T Statistics = 3,043
Accepted
engagement on repurchase intention • P Value = 0,0023
***: path coefficient is significant on level 1%, p value < 0,001
5. Conclusion the higher the consumer engagement to

Based on the data analysis, the effect of the products of PT United Tractors, the
higher the consumer loyalty.
Customer Experience, Customer engage-
ment on Customer Loyalty which affect 3. Customer experience has a positive and
Repurchase Intention several conclusions significant impact on repurchase inten-
are drawn as the hypothesis. This research tion, the higher the consumer experience
studies the relationship between variables with PT United Tractors products, the
(Customer Experience, Customer Engage- higher consumer interest in repurchasing
ment, Customer Loyalty and Repurchase PT United Tractors products.
Intention) 4. Customer Engagement has a positive and
significant impact on repurchase inten-
The conclusions obtained from the results tion, the higher the consumer's attach-
of this study are as follows: ment to PT United Tractors products, the
1. Customer experience has a positive and higher consumer interest in repurchasing
significant impact on customer loyalty, PT United Tractors products.
the higher the consumer experience with 5. Customer Loyalty has a positive and sig-
the products of PT United Tractors, the nificant impact on repurchase intention,
higher the consumer loyalty. the higher consumer loyalty to PT
2. Customer Engagement has a positive and United Tractors products, the higher
significant impact on customer loyalty, consumer interest in repurchasing PT
United Tractors products.
6. Customer Loyalty can mediate the influ- Concepts and Applications (pp. 155–
ence of Customer Experience on Repur- 183). Jones & Bartlett Learning.
chase Intention. The higher the con- Hollebeek, L. (2011) Exploring customer
sumer experience in purchasing the brand engagement: definition and
products of PT United Tractors, the themes, Journal of Strategic
higher the consumer's interest in repur- Marketing, 19(7), pp. 555-573, DOI:
chasing the products of PT United 10.1080/0965254X.2011.599493
Tractors.
7. Customer Loyalty can mediate the influ- Klaus, P., & Maklan, S. (2013). Towards a
ence of Customer Engagement on better measure of customer experi-
Repurchase Intention. The higher the ence. International Journal of Market
consumer's attachment to the products of Research, 55(2), pp. 227–246. https://
PT United Tractors, the higher the doi.org/10.2501/IJMR-2013-021
interest of consumers to repurchase the Lemon, K. N., & Verhoef, P. C. (2016).
products of PT United Tractors. Understanding customer experience
throughout the customer journey.
Journal of Marketing, 80(6), pp. 69–
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THE EFFECT OF CUSTOMER EXPERIENCE AND CUSTOMER

ENGAGEMENT THROUGH CUSTOMER LOYALTY ON SALES

Andrie Permadi, Sukardi Silalahi

Master Program, Swiss German University, Tangerang, Indonesia

Article Information ABSTRACT

Keywords: Customer Behavior, Customer Engagement, Customer

https://journal.sgu.ac.id/ijembm 2021:9(1), pp.1-17 1

1 . Introduction "service failure". CS index can no longer

2 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

is caused by direct or indirect contact experience should become a key focus of

Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17 3

4 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

building customer involvement in processes customers to repeat purchases from certain

Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17 5

6 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17 7

8 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17 9

10 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

transaction in PT United Tractors products made a transaction and the respondent's

Table 1. Description of Respondents Characteristics

Characteristics Category Frequency (f) Percentage (%)

Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17 11

Tabel 2. Construct Validity and Reliability Test Results

Variebel Indikator λ Validitas AVE CR Reliabilitas

12 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

Figure 2. Results of Full Structural Model

Table 3. Goodness of Fit Model

Cut Result Model

Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17 13

In SEM analysis, the coefficient of repurchase intention is influenced by other

The hypothesis used in this test is as

Table 5. Sobel Test Result

Indirect T Statistic P Value Result

14 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

Table 6. Summary of Hypothesis Testing Results

Hypothesis Original Sample (O) Conclusion

(3) Customer experience has an effect on • Path Coef = 0,251

repurchase intention • T Statistics = 3,740 Accepted

5. Conclusion the higher the consumer engagement to

16 Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17

Emerging Markets: Business and Management Studies Journal, 2021:9(1), pp.1-17 17

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