IJIBEC International Journal of Islamic Business and Economics International Journal of Islamic Business and Economics Av a i l a b l e a t h t t p : / / e - j o u r n a l . i a i n p e k a l o n g a n . a c . i d / i n d e x . p h p / I J I B E C / ISSN: 2599-3216 E ISSN: 2615-420X Article Info Article history: Received : 27 July 2018 Accepted : 25 August 2018 Published : 1 Dec 2018 Keywords: Marketing Mix, Brand Image, Service Quality, and Loyalty https://doi.org/10.28918/ijibec. v2i2.1370 JEL: D90; M31 Abstract The objective of research was to find out the effect of marketing mix, brand image, and service quality on customer loyalty in Fatmawati Branch of Bank BNI Syariah. Data employed in this research was primary one; data collection was carried out using questionnaire distributed directly with random sampling method; the object of research was customers of Bank BNI Syariah. This research was expected to contribute to the bank, particularly Fatmawati Branch of Bank BNI Syariah, in order to give good service to their customers. The result of research showed that marketing mix, brand image, and service quality affected positively and significantly the customer loyalty in Fatmawati Branch of Bank BNI Syariah either partially or simultaneously. The Effect Of Marketing Mix, Brand Image And Service Quality On Customer Loyalty In Bank BNI Syariah Ligar Fadilah, Ade Sofyan Mulazid, Yunia Silvia Sesunan Faculty of Economic and Business, UIN Syarif Hidayatullah Jakarta, Indonseia Email: adesofyanmulazid@uinjkt.ac.id 128 International Journal of Islamic Business and Economics (IJIBEC), 2(2) December 2018, 127-136 1. Introduction Banking development increases significantly today. This change occurs due to rapid growth and development of technology, information, machine and heavy equipment, particularly communication technology. As a result, the change impacts quickly on the change of community behavior. In the presence of technology, community can acquire information easily, particularly concerning banking realm in Indonesia. Sharia-compliant banking emerges for the first time with the publication of Law No. 10 of 1999 as the revision of Law No.7 of 1992 about Banking, in which the law directs conventional to establish sharia-compliant branches (Rizal, 2014: 14). Since 2008, sharia-compliant banking in Indonesia starts to use special law for sharia-compliant banking. The law is Law Number 21 of 2008 about sharia- compliant banking ratified on July 16, 2008. The law consists of 13 chapters and 70 articles (Rizal, 2014: 27). The improvement occurs in Indonesian banking sector due to some factors, one of which is marketing. A good right marketing will affect industrial performers positively; one sector affected with it is banking realm. Bank marketing is a process of creating and exchanging bank’s product or service intended to meet customers’ need by means of giving satisfaction (Kasmir, 2003: 63). Considering Bank of Indonesia Governor’s Decree Number 12/41/KEP.GBI/2010 on May 21, 2010 about the publication of business license for PT Bank BNI Syariah, Corporate Plan UUS BNI of 2003 stipulated that the status of UUS is temporary in nature and will undertake spin off in 2009. The plan was realized on June 19, with the operation of BNI Syariah as Sharia-Compliant Public Bank (Bank Umum Syariah or BUS). The realization of spin off time on June 2010 was inseparable from external factor constituting conducive regulation aspect, in this case the publication of Law No.19 of 2008 about Islamic Based Government Securities (Surat Berharga Syariah Negara or SBSN) and Law No. 21 of 2008 about Sharia-compliant banking. In addition, Government’s commitment to sharia-compliant banking development is getting stronger and its awareness of the superiority of sharia-compliant banking product also increases. There have been 65 Branch Offices, 161 Unit Offices, 17 Cash Offices, 22 mobile service cars and 20 Payment points up to June 2014. Considering the data of Indonesian Sharia-Compliant Bank Association (Asosiasi Bank Syariah Indonesia or Asbisindo), there is an increase by 20.33% from IDR 296.26 trillions in late 2015 to IDR 356.50 trillions in late 2016. In addition, the fund reaches IDR 249.09 trillions or increases by 16.40% from IDR 213.99 trillions in previous year. Meanwhile, third party fund gain reaches IDR 279.33 trillions or grows by 20.83% on December 2016 compared with that on December 2015, IDR 231.17 trillions. The position of profit is IDR 2.09 trillions on December 2016, grows by 17.46% compared with that on December 2015, IDR 1.78 trillions (www.bnisyariah.com). Considering the background above, the research on marketing mix is feasible to follow up because the competition between BNI Syariah and other sharia-compliant bank is very tight, confirmed with brand image and service quality in order to create positive perception on and belief in Bank BNI Syariah’s product affecting customer loyalty. 2. Literature Study and Research Hypothesis Marketing Mix Tjiptono (2014: 41) suggests that marketing mix is a set of instruments that can be used by marketers to create the characteristics of service offered to customers. The instruments can be used to arrange long-term strategy and to design short-term tactic program. 129International Journal of Islamic Business and Economics (IJIBEC), 2(2) December 2018, 127-136 Some scholars said that there are four main variables existing in marketing mix called “4P” product, price, place, and promotion. They can be defined as follows. a. Product The product here can be any thing offered to potential customers to meet certain need and want. Product is any thing the market offers to be considered, obtained and used or consumed to meet need and want including physical, service, people, organization, and idea. Product is a combination of product (goods) and service offered by company to target market. Product includes not only physical unit but also packaging, guaranty, brand, and post-sale service (Rivai, 2012: 12-14). b. Price Price, according to Kotler (2008: 345), is a number of values given by customers to benefit from having or using a product or service. c. Place Place shows a variety of activities conducted by company to make product accessible and available to company. Location or place is distribution pertaining to the customers’ convenient access to service. It is a strategic place in which the product is available to enable the consumers to get a product (Rivai, 2012: 31-32). d. Promotion (Promotion) Mc. Daniel et al (2001: 56) define promotion as an activity of producing information, persuading, or reminding consumers about the benefit of a product. Brand Image Brand image, according Tjiptono (2005: 49), describes association consumer’s belief in certain brand. Generally, consumer will buy products with famous brand, because consumers feel safe with something they have known. Brand name distinguishes a product from competitor products. Their strong identity creates main competitive advantage. The brand known by buyers encourages repeated purchasing. A brand is strength. The stronger the value of brand you have, the stronger is the company you have. Factors supporting the creation of brand image in its relation to brand association: (Kotler, 2008). 1. Strength It is the physical advantage the brand has and not found in other brands. This brand’s advantage refers to physical attributes of the brand that can be considered as its strength over other brands. Strength includes the functioning of all product facilities, physical appearance, product price, and appearance of supporting facilities and broad market coverage. 2. Uniqueness Meanwhile, uniqueness is an ability of distinguishing a brand from others. This impression results from product attributes differentiating it from other products. Uniqueness included appearance variation or name of a brand that is memorable and easy to spell, as well as the physique of product. 3. Favorable Favorable characteristics includes the product brand’s easiness to spell and their ability to be memorized by customers making the product well-known and favorite to community and compatibility between brand image in customers’ mind with the image wished by the company over the brand. 130 International Journal of Islamic Business and Economics (IJIBEC), 2(2) December 2018, 127-136 Service Quality Tjiptono (2005: 110) states that “quality is a dynamic condition related to product, service, human resource, process and environment meeting or surpassing the expectation”. In addition, he (2011: 3) also suggests that service is simply a series of activity to do something for others. Quality, according to Koller and Keller (2008: 143), is total feature and characteristics of product or service dependent on the ability of satisfying the need, either implicitly or explicitly. Service discrepancy, according to Lovelock and Wright (2007: 98-99), is not the only one way for the customers to asses service quality. They also use five broad dimensions as the criteria. 1. Tangibles It is physical evidence of service supporting service delivery. It includes physical facilities, equipment, personnel, and communication media. 2. Reliability Reliability means accurate and satisfactory according to the promised one or the ability of giving service according to the need. It means giving service readily and quickly from the first time. 3. Responsiveness It is employees’ desire and efficiency in helping the consumers by giving service as well as possible. 4. Assurance It is an ability the employees have to cater to customers patiently and friendly, responsively, quickly, and reliably. 5. Empathy It is a sincere attention given to consumers, including convenience in establishing relation with consumers, directing, communicating well, giving personal attention, understanding the customers’ need, and corresponding to the time the customers have. Loyalty Literally, loyalty is defined as allegiance, an individual’s allegiance to an object. Mardalis (2005: 111-112) defines loyalty as a condition in which customers have positive attitude to a brand, commitment to the brand, and intend to continue their purchasing in the future. The fully-integrated customers in action loyalty stage can be hypothesized as the ones have low vulnerability to switching to other product. In other words, this action loyalty gives the customers only a little or no opportunity of switching to other products (Mardalis, 2005: 113). Tjiptono in Sangadji and Sopiah (2013: 115) suggests indicators that can be used to measure customer loyalty as follows: a. Repeated purchasing; b. Brand consuming habit; c. Big preference to brand; d. Determination to brand; e. Belief that the brand is the best one; f. Recommending the brand to others; and g. Saying positive things about the company to others. 131International Journal of Islamic Business and Economics (IJIBEC), 2(2) December 2018, 127-136 3. Research Method This study was a quantitative research. This quantitative research was used to answer the problem statement of research, the answer to the problem research using theory only. Quantitative method is appropriate to use in the already clear research generally conducted on broad population, so that the result of research is less in-depth (Sugiyono, 2014: 347). The author selects case study on the customers of Fatmawati Branch of Bank BNI Syariah because the customers themselves feel service quality of Bank BNI Syariah. The research was conducted from June to August 2017. In this study, there were two types of variable: independent and dependent variables. Independent variables were marketing mix (X 1 ), brand image (X 2 ) and service quality (X 3 ), while the dependent on was customer loyalty (Y). Method of Collecting Data Primary data was data source directly giving data to data collector (Sugiyono, 2015: 137). To obtain primary data in this research, the method of collecting data employed was questionnaire. Questionnaire is the technique of collecting data conducted by distributing a series of written questions or statements to be responded to by respondents. Questionnaire can be close- or open- ended questions or statements given directly to respondents or sent via mail or internet (Sugiyono, 2015: 142). Primary data employed in this study was the one based on the response to the questionnaire distributed directly to 100 customers of Fatmawati Branch of Bank BNI Syariah. In this research, the answers given by respondents were scored using Likert scale in checklist (p) for,/ Likert scale is the scale used to measure an individual’s or a group of individuals’ attitude, income, and perception on social phenomenon. Through Likert scale, the variable measured was elaborated into indicator of variable. Then, indicator was made the starting point to arrange instrument items including statement or question (Sugiyono, 2015: 93). Method of Analyzing Data Method of analyzing data employed was a multiple-linear regression one. Basically, regression analysis was a study on the dependency of dependent variable on one or more independent variables (explanatory variables), aiming to estimate and or to predict the mean population or mean score of dependent variables based on independent variable value known (Gujarati, 2003 in Ghazali, 2016: 93). 4. Result And Discussion Normality Test 1. Graphic Analysis Figure. 1 P Plot Regression 132 International Journal of Islamic Business and Economics (IJIBEC), 2(2) December 2018, 127-136 Considering the result of data analysis a shown in figure about p-plot normal curve above, it can be concluded that on p-plot normal curve, there are points spreading around diagonal line, the distribution of which is not too far or wide. It means that this curve shows that regression model is corresponding to normality assumption and feasible to use. Table. 1 Multicolinearity Test Coefficientsa Model Collinearity Statistics Tolerance VIF 1 (Constant) MarketingMix .930 1.076 BrandImage .787 1.271 ServiceQuality .792 1.263 a. Dependent Variable: Loyalty From table above, it can be seen that tolerance value is close to 1 and variance inflation factor (VIF) value is around 1 for each variable, indicated with tolerance marketing mix value of 0.930, brand image discipline of 0.787, and service quality of 0.792. In addition, VIF value was 1.076 for marketing mix, 1.271 for brand image, and 1.263 for service quality. A regression model is stated to be free of multicolinearity problem when it is has VIF score less than 10. Thus, it can be concluded that there is no multicolinearity problem in the regression equation model and this model can be used in this research. Heteroscedasticity 1. Graphic analysis Heteroscedasticity aims to study whether or not there is difference of variance or residual between one observation and another in regression model (Ghozali, 2013: 139) Figure. 2 Scatterplot The figure of scatterplot chart above shows that data is distributed above and below 0 (zero) on Y axis and there is no clear pattern in data distribution, meaning that there is no heteroscedasticity occurring in regression equation model, so that the regression model is feasible to use to predict employee performance based on the variables affecting it, including marketing mix, brand image, 133International Journal of Islamic Business and Economics (IJIBEC), 2(2) December 2018, 127-136 service quality, and loyalty. Table. 2 Multiple Regression Analysis Result of Multiple Linear Regression Test Considering the coefficients above, the following equation can be obtained: Y = a + b1 X1+ b2 X2 + b3 X3 + e where: Y = Customer Loyalty X1 = Marketing Mix X2 = Brand Image X3 = Service Quality a = Constant (Intercept) b1-3 = Coefficient of Regression e= Confounding Variable (disturbance error) T-statistic Test T-test shows the size of effect of independent variables partially on the variation of dependent variable. Table. 3 Result of T-Statistic Test The effect of Marketing Mix (X1) on Customer Loyalty ( Y ) It can be found that t-statistic value of marketing mix is 5.209, while t table can be calculated, 134 International Journal of Islamic Business and Economics (IJIBEC), 2(2) December 2018, 127-136 with = 0.05, as it uses two-way hypothesis, when finding t table, with divided into two, 0.025 and df = n-2, df 100-2 = 98, and it can be found that t table value = 1.984. Thus, t hitung > t tabel or 5.209 > 1.984 with significance level of 0.000 < 0.05. Therefore, it can be concluded that Ho is not supported and H A is supported. It means that marketing mix affects customer loyalty partially. The effect of Brand Image (X2) on Customer Loyalty (Y ) It can be seen t-statistic value for brand image is 12.460, while t table can be calculated, with = 0.05, as it uses two-way hypothesis, when finding t table, with divided into two, 0.025 and df = n-2, df 100-2 = 98, and it can be found that t table value = 1.984. Thus, t hitung > t tabel or 12.460 > 1.984 with significance level of 0.000 < 0.05. Therefore, it can be concluded that Ho is not supported and H A is supported. It means that brand image affects customer loyalty partially. The effect of Service Quality (X3) on Customer Loyalty (Y ) It can be seen t-statistic value for Service Quality is 2.905, while t table can be calculated, with = 0.05, as it uses two-way hypothesis, when finding t table, with divided into two, 0.025 and df = n-2, df 100-2 = 98, and it can be found that t table value = 1.984. Thus, t statistic > t table or 12.460 > 1.984 with significance level of 0.000 < 0.05. Therefore, it can be concluded that Ho is not supported and H A is supported. It means that service quality affects customer loyalty partially. Table. 4 F Test ANOVAa Model Sum of Squares Df M e a n Square F Sig. 1 Regression 402.388 3 134.129 106.838 .000b Residual 120.522 96 1.255 Total 522.910 99 a. Dependent Variable: Loyalty b. Predictors: (Constant), Service Quality, Marketing Mix, Brand Image F test is conducted to find out whether or not all independent variables in the model affect the dependent variables tested simultaneously. It can be seen that f table in this research is 3.09, so that it can be concluded that 106.838 > 3.09 and significance level of 0.000 < 0.05. Therefore, it can be concluded that Ho is not supported and H A is supported, meaning that marketing mix, brand image, and service quality affect customer loyalty simultaneously. Table. 4 Coefficient of Determinacy (R2) Model Summaryb Model R R Square Adjusted R Square Std. Error of the Estimate Durbin- Watson 1 .877a .770 .762 1.120 1.643 a. Predictors: (Constant), Service Quality, Marketing Mix, Brand Image b. Dependent Variable: Loyalty Coefficient of Determinacy (R2) explains the Adjusted R Square of 0.762 or 76.2%, meaning that 76.2% of dependent variable’s ability can be explained by three variables: marketing mix, brand image and service quality. Meanwhile the rest of 23.8% (100%-76.2%) variance of dependent variable is explained by other factors excluded from the regression equation in this study. 135International Journal of Islamic Business and Economics (IJIBEC), 2(2) December 2018, 127-136 5. Conclusion This research aims to find out the effect of marketing mix, brand image, and service quality on customer loyalty in Bank BNI Syariah. The respondents consisted of 100 customers of Fatmawati Branch of Bank BNI Syariah. Considering the data collected and data analysis conducted using multiple linear regression table, it can be concluded that Marketing Mix (X 1 ) affects customer loyalty (Y) in Bank BNI Syariah partially. Brand Image (X 2 ) affects customer loyalty (Y) in Bank BNI Syariah partially. Service Quality (X 3 ) affects customer loyalty (Y) in Bank BNI Syariah partially. 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