Structural equation modelling with IBM SPSS Amos

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To remain competitive in the services sector, companies must better understand what drives key customer behaviors such as purchase intent and repeat purchase frequency. The use of Structural Equation Modeling (SEM) and IBM SPSS Amos is quickly emerging as a powerful approach to understanding this relationship, not only in academia but also in the corporate and public sectors.

By understanding how service quality impacts customer satisfaction and behavioral intentions, firms can develop operational and marketing strategies that enhance customer satisfaction and, in turn, foster positive behavioral intentions such as purchase intent or customer loyalty. The benefits of these strategies are clear and far-reaching.

This paper provides an overview of Dr. Maxwell K. Hsu’s research on the role service quality plays in predicting customer satisfaction and customer behavioral intentions in two types of service industries: lodging and retail banking. The author explains how SEM was applied, starting with IBM® SPSS® Statistics Base* and then using IBM SPSS Amos, to investigate the underlying relationships between service quality, satisfaction and behavioral intentions, with satisfaction being a mediating factor (i.e., the variable that explains the actual relationship between service quality and behavioral intentions).

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