Microsoft Word 2007 ichrie conference Proceedings Final-Final 06-06-07. doc

Figure 3 
Partial Mediation of Perceived Value between Service Quality and Loyalty 
 
DISCUSSION 
The study empirically investigated Parasuraman and Grewal’s Quality-Value-Loyalty chain model.
Several notable findings emerged from this study. First, perceived value was found to be partially mediated between 
service quality and customer loyalty. While perceived value is presented as a complete mediator in the Quality-
Value-Loyalty chain model, only a partial mediation was found in this study. The chain model posits that no direct 
effect of service quality on customer loyalty occurs while the effect of service quality on customer loyalty occurs 
only through perceived value. However, the finding in this study suggested that there would be a direct effect of 
service quality on customer loyalty as well as an indirect effect of service quality on customer loyalty through 

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