The Influence of Perceived Price Fairness and Customer Satisfaction on Restaurant Loyalty

This research study explores the combined influence of perceived price fairness and customer satisfaction on the loyalty of restaurant customers. In an increasingly competitive restaurant industry, retaining loyal customers has become a crucial objective for sustained business growth and profitability. The concept of price fairness—also referred to as perceived price justice—reflects a customer’s belief that the pricing of products or services is reasonable, transparent, and offers value for money. This perception plays a key psychological role in shaping how customers evaluate their overall dining experience and make decisions about future patronage. Using a quantitative research design, data were collected through structured questionnaires administered to 300 restaurant customers in Gwalior, India. Respondents rated their experiences using a five-point Likert scale. Statistical tools, including regression analysis and Sobel testing, were applied to examine the relationships between perceived price justice (PPJ), customer satisfaction (CS), and customer loyalty (CL). The findings reveal that perceived price fairness has a significant and direct positive effect on customer loyalty, whereas customer satisfaction alone does not show a statistically significant direct impact. Importantly, the study identifies a mediating effect of price fairness in the relationship between satisfaction and loyalty. This means that customers are more likely to become loyal not merely when satisfied but when they also feel that the pricing is just and aligned with their expectations.