The Effect of Customer Experience on Saudi Passenger Satisfaction: The Moderator for Business Model

Abstract This study examines the impact of customer experience on passenger satisfaction in the Saudi airline industry, exploring the moderating influence of airline business models, specifically comparing full-service and low-cost carriers. The research employs a quantitative design, utilizing a structured questionnaire to gather data from passengers of major Saudi airlines, including Saudi Airlines, Flynas, and Flyadeal. Data were analyzed using Structural Equation Modeling (SEM) through SmartPLS to assess the structural and measurement models and to test direct and interactive relationships. Results indicate that customer experience exerts a strong, statistically significant effect on passenger satisfaction, confirming its pivotal role in shaping perceptions within the airline sector. However, findings show that the airline business model (full-service versus low-cost) does not significantly moderate this relationship, suggesting that the effect of customer experience on satisfaction remains stable across different types of airlines. Based on these insights, the study urges airlines—regardless of business model—to prioritize delivering a seamless, integrated, and customer-focused experience at all touchpoints. Emphasis should be placed on digital transformation, process optimization, and improving employee-customer interactions. This research contributes to the literature by reinterpreting airline type as a business model rather than a firm-specific attribute, and by providing empirical evidence from the Saudi aviation context. It also delivers practical implications aligned with Saudi Vision 2030 and the Saudi Aviation Strategy, particularly by enhancing passenger experience, improving service quality, and advancing the sector's competitiveness.