Rafikhein Novia Ayuanti, Sudarmiatin, Cipto Wardoyo, Imam Mukhlis, Rike Selviasari, Ustadus Sholihin
Tourism plays a vital role in supporting the Sustainable Development Goals (SDGs), particularly through the hospitality sector’s contribution to local economic development and social welfare. In the context of budget accommodation, two-star hotels represent a growing yet underexplored segment in sustainability and customer behavior research. This study aims to examine the effects of Corporate Social Responsibility (CSR) and service quality on customer loyalty in two-star hotels in East Java, Indonesia, with customer satisfaction and corporate image serving as mediating variables. This research employed a quantitative explanatory design. Data were collected from 385 domestic and international tourists who had stayed at two-star hotels more than once. The respondents were drawn from a population of 539 two-star hotels listed on Traveloka and located across 22 cities and districts in East Java. Partial Least Squares– Structural Equation Modeling (PLS-SEM) was used to analyze the relationships among the constructs and to test both direct and indirect effects. The findings reveal that CSR and service quality have significant positive effects on customer loyalty. These effects occur both directly and indirectly through customer satisfaction and corporate image. The results further confirm that customer satisfaction and corporate image play critical mediating roles in strengthening the relationship between CSR, service quality, and customer loyalty. Hotels that consistently implement socially responsible initiatives and deliver high-quality services are more likely to enhance customer satisfaction, build a favorable corporate image, and foster long-term customer loyalty. The structural model demonstrates strong explanatory power (R² = 0.849) and high predictive relevance (Q² = 0.599), indicating the robustness of the proposed framework. This study contributes to the hospitality management literature by extending the understanding of CSR and service quality as strategic drivers of customer loyalty in the budget hotel segment. From a managerial perspective, the findings suggest that two-star hotel managers should integrate CSR practices with continuous service quality improvements to strengthen customer relationships, enhance competitive advantage, and achieve sustainable business performance within the evolving tourism industry. © 2026, Malque Publishing. All rights reserved.
Faculty Economy and Business, Universitas Negeri Malang, Malang, Indonesia; Faculty Economy, Universitas Islam Kadiri, Kediri, Indonesia
