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Effect of Production Strategy Performance on Brand Royalty
Endrixs Endrianto
1*
, Ahmad Zaelani Adnan
2
, Ninin Asmiah
3
, Lia Nurmeliani
4
Institut Teknologi Petroleum Balongan Indramayu, Indonesia
1,2,3,4
endrixsendrianto[email protected]
1*
, ahmadzaelani.adnan@gmail.com
2
, nininasminah@yahoo.com
3
,
lianur.meliani152@gmail.com
4
PAPER INFO ABSTRACT
Received: 14
th
December 2022
Revised: 17
th
December 2022
Approved: 20
th
December 2022
Background: Product strategy is a plan that identifies the goals and
objectives of a product and then explains the vision to achieve those goals.
This helps to relate the vision of the project with the actual methods used to
implement it. Product strategy maps out key benchmarks for creating,
marketing, and distributing any concept you plan to sell.
Aim: The purpose of this study is to determine the effect of production
strategy performance on brand royalty in companies and restaurants.
Method: The sample used in this study can be determined using the infinite
sample formula, with a 95% confidence level and a 10% error level, the
sample used in this study was 100 people as respondents. The sampling
technique in this study is non probability sampling with the Purposive
Sampling.
Findings: They also provide a central plan that people across the business
can refer to to guide their efforts and fine-tune their overall business strategy.
Business in the food sector is a potential business at this time. Factors that
need to be considered in facing competition in the restaurant business include
products and prices. If these two factors are getting better and more
attractive, it can make customers feel satisfied, if customers feel satisfied,
they will be loyal to the restaurant
KEYWORDS
Sports Facilities, Management
INTRODUCTION
Consumers can recognize a product or service through a brand. Through brands,
consumers can distinguish between one product or service and another (Syah and Yanuar
2013). The brand is an intangible asset whose value is more expensive than other physical
assets such as land area, buildings and also production machines (Ferawati 2018). Brands have
potential responses to generate consumer trust. Consumers who are loyal to a brand (brand
loyalty) will be ready to pay more for the brand because they feel that they have gained unique
value in the brand and are not obtained in other brands (Tepeci 1999). Branding is still used as
a marketing strategy that provides added value for goods or services companies. Because the
brand is accepted as an effective fundamental factor in consumer behavior. As the times go by,
human choices to fill their free time are very diverse (Shabastian 2013). Nowadays, many
spend their free time by going to entertainment places such as cafes, cinemas, restaurants and
shopping centers. In accordance with the development of this era, Surabaya as a metropolitan
city also responded, namely with the existence of a number of shopping centers, some of which
have been operating and others are still in the stage of planning and development stages. In a
fierce competition, product differentiation and prices are very important, considering the large
variety of products offered today (Pradono, Kusumantoro, and Retapradana 2015). Product
differentiation and prices aimed at pampering consumers and containing loyal consumers to a
brand are things that must now be more misinterpreted in the future. Differentiation in the
product can be in the form of packaged flavors or it can also be the quality of the product itself
(Mutiara 2018). While the elements of the price can be in the form of discounts or discounts.
Effect of Production Strategy Performance on Brand Royalty
152 Return: Management Studies, Economics and Business, Vol 1(No 04), Dec 2022
Because having loyal consumers to a brand is a very big asset for a company (Yoo, Donthu,
and Lee 2000).
Marketing
Marketing has a wide scope with various meanings. But these understandings basically
have the same meaning. As some of the following economic experts have pointed out.
According to Kotler (2004) in (Shabastian 2013) marketing by social definition is a social
process by which individuals and groups get what is needed and desired by creating, offering
and freely exchanging valuable products and services with other parties‖. Meanwhile, when
viewed from a managerial definition, marketing is often described as the art of selling products.
Meanwhile, Vellas and Becherel in (Shabastian 2013) explain that marketing is a management
process that identifies and anticipates demand and customer satisfaction by making a profit.
The American Marketing Association(Kotler and Amstrong 2002:10) defines marketing as the
process of planning and executing thoughts, pricing, promotion, and channeling ideas, goods,
and services to create exchanges that meet individual and organizational goals.
Marketing Mix
Marketing mix is the set of marketing tools that the firm uses to pursue its marketing
objectives in the market.'' (Aaker,1997) which more or less means marketing mix is a collection
of controllable marketing variables used by a business entity to achieve marketing goals in the
target market (Wong and Merrilees1 2007). According to (Stanton and Futrell 1978) The
marketing mix is a combination of 4 variables or activities that are the core of the company's
marketing system, namely products, prices, promotion activities and distribution systems.
Product
A product is everything that can be offered to gain attention, proficiency, use, or
consumption that may satisfy a need and desire. Sometimes we use other terms for products,
such as offering, and solution (Kotler 2001). Products are also defined as anything that is
offered into the market to get attention, owned, used or consumed so that it can satisfy the
needs or desires of customers. Included in the physical object, services, people, places,
organizations and ideas (Kotler and Amstrong 2002). Products have several components,
namely diversity (product variety). Quality, design, features, brand, packing, sizes, services,
warantties and returns, as stated by Kotler (Adnan et al. 2022). A company must find ways
that are meaningful and in line with the development of the times to perfect the products it
offers, it is because every product produced has a product life cycle, where after reaching the
maturity stage, usually a product will experience a decline and possibly die along with the
emergence of new technologies and switch from the maturity stage of the product to new
growth (Musfar and SE 2020). As for producing a quality product, the management must
determine the concept of a product that states that consumers will like a product that offers the
best quality, performance, and innovative complements. Managers in product-oriented
organizations focus their attention on the undertaking that produces the product, the
management can assume that buyers value a well-made product and they can judge the quality
and performance of a product (Akbar 2021).
Prince
In financial transactions, it is customary to quote prices in another way. The most obvious
example is in the price of the loan, when the cost will be expressed as a percentage of the
interest rate. The amount of interest paid depends on the loan amount and the loan period
(Suherman and Siska 2021). Another example can be found in the prices of financial
derivatives and other financial assets. For example the price of inflation related to government
securities in some countries is quoted as the actual price divided by the factor representing
inflation since the security was issued. The path in question is a vision (future goal) for an
organization or company that is right in the jungle of the organization both in the present and
future (Shabastian 2013).
Effect of Production Strategy Performance on Brand Royalty
153 Return: Management Studies, Economics and Business, Vol 1(No 04), Dec 2022
METHOD
The sample used in this study can be determined using the infinite sample formula, with a 95%
confidence level and a 10% error level as follows :
n = Z2 .p.q
d 2
Informations :
n= number of samples
Z= Price interval depending of Alpha (=1- 0,95=0,05), so his Z = 1,976
p= estimator proporsi populasi
d= interval (0,10)
q= 1 p
Z
0,01 (1%)
2,576
0,05 (5%)
1,976
0,10 (10%)
1,645
So the sample count is:
(1,976)
2
(0,5)(0,5)
n =
(0,10)
2
3,904x0,25
=
0,01
= 97,6 = 100 responden
Therefore, the sample used in this study was 100 people as respondents. The sampling technique
in this study is non probability sampling with the Purposive Sampling method. The non
probability sampling technique is a sampling technique where each member of the population
does not have the same opportunity to be selected as a sample.
RESULTS AND DISCUSSION
Characteristics of respondents selected by researchers totaled 100 people and grouped over
certain characteristics, including respondents' gender, respondent's age, respondent's occupation,
and respondent's monthly expenses, Here are the results of processed data using SPSS 13.0.
Table 1. Profile of Respondents by age
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154 Return: Management Studies, Economics and Business, Vol 1(No 04), Dec 2022
Table 2. Respondent Profile Based on Respondent's Last Education
Table 3. Respondent Profiles Based on Last Go to Cafe
Table 4. Respondent Profiles Based on Last Go to Cafe
Table 5. Respondent Profiles Based on Who to Go to Cafe with
Table 6. Respondent Profiles Based On What Time To Go To Cafe
Descriptive Analysis of Respomden Convergent Validity and Reliability Construct
Responses Validity shows the extent to which the measuring device measures what it wants to
measure. The validity test is carried out through convergent validity, where the indicator is said
to have convergent validity if the indicator has a standardized regression weight value of > 0.50
and a probability value (prob.)
CONCLUSION
Based on the results of the SEM analysis and discussion, conclusions that can be
formulated: 1) Product Strategy in this study has a significant effect on Brand Loyalty. If
viewed in terms of products, Tator Cafe does have a variety of food and drinks, quality that is
Effect of Production Strategy Performance on Brand Royalty
155 Return: Management Studies, Economics and Business, Vol 1(No 04), Dec 2022
always maintained, food and beverage jamanan, attractive food and beverage design, satisfying
service, the right portion, good packaging and shape. All these things make customers satisfied
with the food and drinks served by Tator Cafe and make customers Loyal to Tator Cafe. 2)
Pricing Strategy also has a significant effect on Brand Loyalty. The price offered by Tator Cafe
is indeed for the upper middle class. From the results of the study, it can also be formulated
that the Price Strategy makes customers satisfied and makes customers loyal to Tator Cafe. 3)
When viewed as a whole, the Product Strategy and Price Strategy have a significant effect on
the Loyaty Brand even though the Product Strategy is more dominant when compared to the
Price Strategy
From the results of the research and conclusions mentioned above, suggestions can be
submitted as follows: 1) In terms of Product Strategy: Food and beverages served by Tator
Cafe can satisfy customers and make customers loyal to Tator Cafe, even so Tator Cafe must
maintain so that customers can continue to be loyal. To maintain it, Tator Cafe is recommended
to add a variety of food and drinks within a certain period of time, training employees to
maintain the quality of service.
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