Loyalty Program and Word of Mouth in Educational Context: A Test of Moderation

The main purpose of this research is to examine the role of loyalty program in moderating the effect of satisfaction on the positive word of mouth. However, in this context, it needs to be proved in advance how the service quality and tuition fee affect the satisfaction and word of mouth. The study was conducted on a number of 120 students in the capital city of Indonesia-Jakarta, by using convenience sampling technique and processed based on hierarchical regression analysis method. The results showed that service quality has positive effects on satisfaction and word of mouth, as well as the tuition fees, has positive effects on satisfaction and word of mouth. While the effect of satisfaction in shaping positive attitudes towards word of mouth was still not consistent. The phenomenon of such relationship is likely to happen due to the satisfaction can change instantly if there is a change to the situation. In other words, in this context, the role of the loyalty program is considered as a moderating variable that could undermine the formation process of positive word of mouth recommendation.