HOW PRICE AND SERVICE STAFF SHAPING CUSTOMER SATISFACTION AND LOYALTY

Abstract

This study aims to evaluate the influence of price and people on customer loyalty, with customer satisfaction as a mediating variable, in Padang restaurants in Riau. This study employed a quantitative approach with an explanatory research design. Data were obtained through an online questionnaire distributed using Google Forms, which successfully collected 155 respondents who met the research criteria. Data analysis was conducted using Partial Least Squares (SEM-PLS)-based structural equation modeling to examine the relationships between latent variables and their mediating roles. The results showed that price had a positive and significant effect on customer satisfaction and loyalty. Similarly, employee behavior had a positive influence on customer satisfaction and loyalty. Furthermore, customer satisfaction was shown to mediate the relationship between price and employee behavior, leading to customer loyalty. These findings confirm that the combination of a fair pricing strategy and positive employee behavior can increase customer satisfaction, ultimately strengthening loyalty. The practical implication of this study is the need for Padang restaurant managers in Riau to implement competitive pricing strategies while improving the quality of employee interactions with customers to build long-term satisfaction and loyalty.