Revisiting Customer Satisfaction-Loyalty Link: Exploring the Role of Adjusted Expectations in North Cyprus Restaurants

Driving customer satisfaction to customer retention and customer referrals are the interesting topic for managers in recent literature, but there is a gap in explaining the mechanism of this transition with comprehensive models lacking consideration of adequate affecting factors on customer satisfaction-loyalty link. Hence, this study aims to develop a model investigating the role of customer satisfaction along with the respective adjusted expectations of customers on a proper customer loyalty index. Survey research with 308 respondents in North Cyprus has been conducted to draw statistical conclusions regarding the proposed model. The findings of this study suggest that customer satisfaction is a significant predictor of customers' intentions in terms of repurchase and referral intentions and adjusted expectation is a partial mediator in latter relationships. Hence, it is suggested that tracking the levels of satisfaction and adjusted expectations of customers will facilitate predicting of respective positive attitudinal loyalty in the future. The dimensions of attitudinal loyalty including repurchase and WOM referral intentions have been employed as a proper index to measure customer loyalty. To measure the effect of customer satisfaction and adjusted expectation on dimensions of attitudinal loyalty separately, this study has been used the developed constructs extracted from literature to define repurchase and WOM referral intentions as a separate construct in the proposed model. This feature of the proposed model enables future studies to measure to what extent other factors such as perceived switching costs would affect attitudinal loyalty dimensions in an isolated manner. Keywords: Customer Satisfaction, Customer Loyalty, Adjusted Expectation, WOM Referral Intention, Repurchase Intention, Restaurants, North Cyprus