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THE STRATEGY FOR IMPROVING THE CUSTOMERS LOYALTY OF KAI AGRO PARAHYANGAN

Purpose: This study aims to find out about the influence of price fairness and service quality toward customers’ satisfaction and loyalty, along with its indirect relationship on customers’ loyalty. This study focuses on the customers of Indonesian Railways Company/KAI especially the passenger of Argo Parahyangan with Jakarta – Bandung route through Gambir Station. Methodology: This study used a descriptive qualitative methodology, applying Square Equation Model (SEM) in analyzing the data. The sample is taken from 254 customers who use KAI Agro Parahyangan. Result: The results showed that full mediation on price fairness variable has no significant influence toward the customers’ satisfaction. Meanwhile, for the variable of service quality has significant and positive influence on customers’ satisfaction. But, both price fairness and service quality are having significant relationship toward customer’s loyalty. Conclusion: Therefore, in conclusion, customer’s loyalty is influenced by the customer’s satisfaction.