THE ROLE OF CUSTOMER SATISFACTION IN MODERATING THE EFFECT OF SERVICE QUALITY AND PRODUCT QUALITY ON CUSTOMER LOYALTY

ABSTRACT: Satisfaction is one of the keys to forming customer loyalty. Service quality and product qualityare important elements that must be considered to create customer satisfaction which will further affectcustomer loyalty. This study aims to determine the role of customer satisfaction in moderating the effect ofservice quality and product quality on customer loyalty. This research was conducted in Denpasar City, with150 respondents who were taken by purposive sampling technique. The object in this study was customerloyalty to McDonald’s consumers. Data collection was carried out through questionnaire collection. The dataanalysis technique used was moderated regression analysis. Based on the results of the analysis found thatservice quality has a positive effect on customer loyalty, product quality has a positive effect on customerloyalty, customer satisfaction affected the effect of service quality on customer loyalty and customer satisfactionstrengthens the effect of product quality on customer loyalty. McDonald’s management could provide a uniqueand attractive product display that was easily attractive, always uses fresh ingredients to improve productquality, creates superior products that were not yet supported by competition, provides special discounts forloyal customers, improves service quality, provides guarantees security for its customers, a guarantee ofcompensation if service quality did not match what was promised to increase customer loyalty and was notapproved by the acceleration of other fast-food restaurants.

KEYWORDS: service quality, product quality, customer satisfaction, customer loyalty