THE EFFECT OF SERVICE QUALITY AND PRODUCT QUALITY ON CUSTOMER LOYALTY IN RISOL GOGO UMKM IN MEDAN CITY

Abstract

This study aims to analyze the influence of service quality and product quality on customer loyalty at Risol Gogo SME in Medan City. In an era of intense business competition, especially in the food SME sector, maintaining customer loyalty has become a key to long-term success. This research uses a quantitative approach with survey method to 150 Risol Gogo customers selected using purposive sampling technique. The research instrument uses a questionnaire with a 5-point Likert scale that has been tested for validity and reliability. Data analysis was performed using SPSS version 25 with multiple linear regression analysis technique. The results showed that service quality has a positive and significant effect on customer loyalty with a coefficient value of 0.342 (p < 0.05). Product quality also has a positive and significant effect on customer loyalty with a coefficient value of 0.456 (p < 0.05). Simultaneously, service quality and product quality have a significant effect on customer loyalty with an R² value of 0.623, which means 62.3% of customer loyalty variation can be explained by these two independent variables. The implications of this research indicate that Risol Gogo SME needs to focus on improving product quality and service to maintain and increase customer loyalty.