Does employee performance affect customer loyalty in pharmacy services?

Abstract

Purpose – Employees in community pharmacies play a far significant and distinct role compared to the employees in traditional retail stores. The purpose of this paper is to examine the effects of employee performance (EP) on customer loyalty of pharmacy services. Design/methodology/approach – Data were collected through a self-administered survey filled in by the customers of 25 community pharmacies. A total of 679 completely filled-in questionnaires were analysed. The proposed model was tested through structural equation modelling using AMOS 22. Findings – EP positively affects pharmacy customers’ perceived value (PV), trust and loyalty. PV and trust fully mediates the relationships between EP and customers’ attitudinal and behavioural loyalty. Unlike short-term customers, the long-term relational customers’ PV was found to have significant impact on their trust and behavioural loyalty. Research limitations/implications – This study is based on the Australian community pharmacy industries; hence, caution must be exercised in the generalization of the results to other countries. The study has considered only PV and trust in examining the link between the EP and customer loyalty. Other variables such as commitment could possibly influence the link, which has not been considered in this study. Originality/value – The study contributes to the existing literature by focusing on how EP affects both attitudinal and behavioural loyalty of pharmacy customers. It shows empirical evidence that EP influences customers’ PV and trust en-route to influencing their loyalty. The study measures EP based on both empathy and service provider performance covering a broader spectrum of the construct.

Community pharmacy customer segmentation based on factors influencing their selection of pharmacy and over-the-counter medicines

“…Customers of this segment appeared to display a high level of loyalty to a particular pharmacy, making their purchases in a single pharmacy and looking for a familiar relationship with the pharmacy staff. This finding is consistent with those of previous studies indicating that elderly customers display high pharmacy patronage (Rabbanee et al, 2015).…”

Does a workload influence the performance of bank employees?

“…The high performance of employees can increase customer loyalty and trust. Rabbanee et al (2015) show that employee performance had significantly positive effects on customer's expected value, trust, and loyalty. Pang and Lu (2018) reported a substantial and positive effect of employees' motivation on financial figures such as return on asset and profitability.…”

Combined effects of franchise management strategies and employee service performance on customer loyalty: a multilevel perspective

“…Although the franchisor-franchisee relationship is usually governed by formal contracts, such contracts often cannot specify all possible contingencies, especially in the context of international franchisees, where the franchisees feel the need to adapt local practices. Irrespective of the nature of the relationship and geographical location of the franchisor and franchisee, employee performance at franchisee level is an essential precursor of customer loyalty towards the franchisee store, including the community pharmacy store (Rabbanee et al, 2015). Community pharmacy in Australia includes about 5,000 stores (Hamilton, 2009), which are primarily operated on a franchisor-franchisee relationship basis.…”

“…Hence their performance quality is a major issue to the customer in terms of their trust and loyalty. In addition, loyalty of the pharmacy customer depends not only on perceived value received from the products purchased from the pharmacy store, but also on the performance of the franchisee employees' performance (Rabbanee et al, 2015). The behaviour of the employee plays an important role in shaping the customer's perception of service quality (Liao & Chuang, 2004).…”

“…However, little is known about whether and how franchisors' strategies affect franchisees' performance, especially the performance of franchisee employees. Although franchisee employee performance is likely to be influenced by franchisors' management strategies and is found to positively influence consumers' attitudes and behaviour (Rabbanee, Burford & Ramaseshan 2015); no research thus far examined the chain of effects of : franchisor management strategies -franchisee employee performance -consumer loyalty.…”