literature on customer satisfaction
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1
REVIEW OF LITERATURE
This chapter attempts to review different literatures on customer satisfaction
with reference to hotel industry and presents various studies made regarding the issues
related with hotel industry and customer satisfaction.
Customer – Definitions
Paul S. Goldner (2006
1
defines! "#a customer is any organi$ation or
individual with which you have done %usiness over the past twelve months&.
Grigoroudis! ' and Sisos! ) (200*2 provide definition for +customer, upon
two approaches- ith reference to loyalty! "/ customer is the person that assesses the
uality of the offered products and services& and on process oriented approach! "the
customer is the person or group that receives the wor output& (p.*.
"ustomer means the party to which the goods are to %e supplied or service
rendered %y the supplier&.
Customer Satisfaction – Definitions
Satisfaction has %een %roadly defined %y 3avra! T.G. (1**4 as a satisfactory
post5purchase eperience with a product or service given an eisting purchase
epectation.7
8oward and Sheth (1*6*9
define satisfaction as! "The %uyer,s cognitive state
of %eing adeuately or inadeuately rewarded for the sacrifices he has undergone&
(p.179.
/ccording to est%roo and :eilly (1*;6! customer satisfaction is "an
emotional response to the eperiences provided %y! associated with particular
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products or services purchased! retail outlets! or even molar patterns of %ehaviour
such as shopping and %uyer %ehaviour! as well as the overall maret place& (p.296.
<liver (1*;14 put forward a definition as! "the summary psychological state
resulting when the emotion surrounding disconfirmed epectations is coupled with the
consumers, prior feelings a%out the consumption eperience& (p.24.
The definition offered %y 8unt (1*44;
is "an evaluation rendered that the
(consumption eperience was at least as good as it was supposed to %e& (p.79*.
ustomer=consumer satisfaction is "an evaluation that the chosen alternative is
consistent with prior %eliefs with respect to that alternative& > ?efinition %y 'ngel and
@lacwell (1*;2*
(p.901.
Tse and ilton (1*;;10
define as! "the consumer,s response to the evaluation
of the perceived discrepancy %etween prior epectations (or some other norm of
performance and the actual performance of the product=service as perceived after its
consumption& (p.207.
@erry and Parasuraman (1**111
argue that since customers, satisfaction is
influenced %y the availa%ility of customer services! the provision of uality customer
service has %ecome a maAor concern of all %usinesses. ustomer satisfaction is
typically defined as a post consumption evaluative Audgement concerning a specific
product or service.12
Bt is the result of an evaluative process that contrasts pre5
purchase epectations with perceptions of performance during and after the
consumption eperience.1
<liver (1*;117
defines customer satisfaction as a
customer,s emotional response to the use of a product or service. /nton (1**619
offers more ela%oration- "customer satisfaction as a state of mind in which the
customer,s needs! wants and epectations throughout the product or service life have
%een met or eceeded! resulting in su%seuent repurchase and loyalty&.
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Cerchant /ccount Glossary points out that! "ustomer satisfaction is an
am%iguous and a%stract concept and the actual manifestation of the state of
satisfaction will very from person to person and produce=service to
produce=service.....&16
Schiffman and Danu (200714
defines customer satisfaction as "The
individual,s perception of the performance of the product or service in relation to his
or her epectations&.
oodruff and Gardian (1**61;
define "Satisfaction! then! is the evaluation or
feeling that results from the disconfirmation process. Bt is not the comparison itself
(i.e.! the disconfirmation process! %ut it is the customer,s response to the comparison.
Satisfaction has an emotional component.&
/ccording to 8ung (1*44! "#. satisfaction is a ind of stepping away from
an eperience and evaluating it # <ne could have a pleasura%le eperience that
caused dissatisfaction %ecause even though it was pleasura%le! it wasn,t as pleasura%le
as it was supposed to %e. So satisfaction = dissatisfaction isn,t an emotion! it,s the
evaluation of the emotion&.1*
<liver (1*4420
defines "Satisfaction is the consumer,s fulfilment response. Bt
is a Audgment that a product or service feature! or the product of service itself!
provided (or is providing a pleasura%le level of consumption5 related fulfilment!
including levels of under5 or over5fulfilment&.
Some of the definitions availa%le from we% are compiled %elow- "ustomer
satisfaction! a %usiness term! is a measure of how products and services supplied %y a
company meet or surpass customer epectation&.21
"ustomer satisfaction is an
am%iguous and a%stract concept and the actual manifestation of the state of
satisfaction will vary from person to person and product=service to product=service&.22
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"omparison of epectations versus perception of eperience&.2
"/ customer,s
perception of the degree to which their reuirements have %een fulfilled.&27
/ccording to @usiness ?ictionary! customer satisfaction is! "?egree of satisfaction
provided %y the goods or services of a firm as measured %y the num%er of repeat
customers.&29
These definitions suggest that an evaluative process is an important element
underlying customer satisfaction.26
Hotel Industr – Definitions
Peter Eones and /ndrew Focwood (200224
provide a simple definition for
hotel as! "an operation that provides accommodation and ancillary services to people
away from home.&
/ccording to ?ictionary of /merican 8istory
2;
"The primary purpose of
hotels is to provide travellers with shelter! food! refreshment! and similar services and
goods! offering on a commercial %asis things that are customarily furnished within
households %ut unavaila%le to people on a Aourney away from home&.
8otel industry is a large and highly diverse industry that includes a wide range
of property styles! uses and ualities.2*
Peter Eones and /ndrew Focwood (2002 defines a hotel as "a! usually large!
house run for the purpose of giving travellers food! lodging etc.& urther add! "an
operation that provides accommodation and ancillary services to people away from
home.&0
<,allon and :utherford (20101
! in "8otel Canagement and <perations&
define "hospitality is the cordial and generous reception and entertainment of guests
or strangers! either socially or commercially& (p.14.
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The @uilding ode of the ity of Hew )or defines! "/ hotel shall %e taen to
mean and include every %uilding! or part thereof! intended! designed or used for
supplying food and shelter to residents or guests! and having a general pu%lic dining5
room or a cafI! or %oth and containing also more than fifteen sleeping rooms.2
Peyton! :.C. et al (200
in their woring paper su%mitted at the /llied
/cademies Bnternational onference presented a comprehensive review of the
literature on various ustomer Satisfaction and ?issatisfaction (S=? theories
proposed. The literatures are specifically prior to the 1**0s. This review focuses on
the maAor components of the decision5maing process! also addresses the
measurement5related issues relevant to this %ody of literature. The paper analyses
four theories under the um%rella of consistency theory vi$. assimilation theory!
contrast theory! assimilation5contrast theory! and negative theory. Bn addition to
presenting a review of theoretical %ases of the research in the area of consumer
satisfaction! the paper also addresses the maAor elements of the most widely accepted
models of onsumer Satisfaction and ?issatisfaction. The authors argue that even
though the satisfaction construct has %een defined in a num%er of ways! satisfaction
has %een defined in terms of need fulfilment! pleasure=displeasure! cognitive state!
attri%ute or %enefit evaluation! and su%Aective evaluation of eperience %y many
researchers. The review concludes! "however! while researchers have used a num%er
of different definitions for satisfaction! they generally agree that satisfaction involved
a set of inter5related varia%les rather than a single varia%le& (p.77.
3avra! T.G. (1**47
in his %oo suggests specific programmes to improve the
measurement of customer satisfaction in an organi$ation. The author descri%es five
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critical sills reuired for this tas vi$. sampling=customer5participant selection!
uestionnaire design! interviewing=survey administration! data analysis! and uality
function deployment5%uilding action plans. The author argue that to etend the
understanding of the eact relationships preceding and following the formation of
satisfaction! a model of satisfaction would %e very helpful. The model proposed has
three stages- antecedents! the satisfaction formation process! and conseuences. Prior
eperience is claimed to %e the most important antecedent of satisfaction! since it
serves as a memory %an of all previous eperiences. The satisfaction process is
claimed to encapsulate a comparison of epectations with perceived performance.
'pectations are defined as the sum of %eliefs a%out the levels of attri%utes possessed
or offered %y the product or service. Bn the model presented! the concept of desires is
adopted as an influencing factor on the formation of epectations. The %ehavioural
conseuence of customer retention is claimed to %e at %est an intermediate sign that
has not immediately alienated a customer. The author further classifies the
+performance, of a product or service as +o%Aective, and +perceived,. To epound the
%ehaviour of satisfaction as a phenomenon graphical representation is used. ive
theories of satisfaction from social psychology have %een discussed vi$. /ssimilation5
ontrast Theory! ontrast Theory! ?issonance Theory! Generali$ed Hegativity! and
8ypothesis Testing. The author has summari$ed the conseuences for satisfaction for
all these five theories and presented in a ta%ulation form for easy comparison.
The woring paper %y Silvia igini and Paolo Giudici (20029
study the
possi%le methods to o%tain data to measure customer satisfaction! the possi%ilities of
methods to analy$e the collected data! eplain methodological proposal %ased on
discrete graphical models and a novel theoretical proposal to miture different types
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of customer data information! statistical analysis of sample dataset! and in the final
chapter present the conclusions. Present two possi%le novel approach to analy$e
customer satisfaction data. The authors suggest that we% could %e the first contact for
collection of customer satisfaction data and this method facilitates continuous
monitoring the opinion of the visitors to the site. The second contact method
identified is telephone and=or mail=email %ut this method is found to have low
response rates. inally face5to5face interview option is eplained as the intimacy can
%e used to communicate care and concern to customers! %ut argue that this method
may have the disadvantage that customers may %e more reluctant to criticise or spea
negatively a%out the program in a face5to5face interview than in an Bnternet! mail! or
telephone survey.
hile eplaining measuring the level of satisfaction! the authors opine since it
can %e difficult to o%tain an eact agreement %etween the customers, opinion and the
numerical value stated! using a limited scale it would %e feasi%le to allow for a small
approimation error. urther classify concepts that are not directly measura%le as
+latent varia%les, and varia%les that can %e directly measured are called +manifest
varia%les,. The paper proposes five levels of opinions for the customers vi$. +very
unsatisfied! moderately unsatisfied! neutral! moderately satisfied! and very satisfied.
illard 8om (20006
presents two %roadly classified customer satisfaction
models vi$. Cacro5models! which place the customer satisfaction among a set of
related constructs in mareting research and Cicro5models! which theori$e the
elements of customer satisfaction. The paper also gives various models of customer
satisfaction from the perspective of the mareting research discipline. The concepts
vi$. value! uality! complaining %ehaviour! and loyalty are la%elled as +macro5models,
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The mareting research literature presented in this study etensively covers the
elements that mae up the concept of customer satisfaction vi$. disconfirmation of
epectations! euity! attri%ution! affect! and regret. These attri%utes are grouped under
+micro5models,.
/ccording to the author the macro5model underlies perceived performance!
comparison standards! perceived disconfirmation! satisfaction feeling! and outcomes
of satisfaction feelings. urther su%stantiates that this model highlights the concept of
value as a driving force in produce choice and satisfaction relationship to it as a %rief
psychological reaction to a component of a value chain. Jnder the Cicro5model the
author lists seven models vi$. (1 'pectations disconfirmation model! (2 Perceived
performance model! ( Horms models! (7 Cultiple process models! (9 /ttri%ution
models! (6 /ffective models! and (4 'uity models. This paper has covered a vast
pool of mareting research in customer satisfaction and simplified the presentation %y
grouping under macro5level and micro5levels.
The study %y /le C. Sussind (20024
eamines how the nature of service
failure together with the restaurant,s service5recovery effort influences customers,
intentions to return to the restaurant and their su%seuent word5of5mouth
communication regarding the incident and the restaurant. The study shows how word5
of5mouth communication materiali$es from service eperiences. The author argues
that the consumers evaluate the components of service vi$. food! service! and
am%ience rather than as a total picture! and the customers form an opinion for each
item individually. ord5of5mouth communication! it is argued! which relates %oth
positive and negative evaluations of service encounters! has %een shown to influence
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other people,s purchase %ehaviour. Bn that sense! word5of5mouth communications!
which are positive! may emerge from customers! who are satisfied with the services >
where as negative word5of5mouth communication emerges from customers who have
eperienced dissatisfying eperiences or encounters. Bt is also pointed out that
dissatisfied customers spread their dissatisfaction through word5of5mouth
communication a%out their %ad eperience and dissatisfaction to others than the
satisfied customers. The study also eamines the level of complaints regarding
service failure and remedies- Cinor service failures may solicit smaller remedies >
where as remedies lie offering free food! discounts or coupons! or the manager,s
intervention are seen as corrections involving a high degree. urther argues that the
degree of correction is not the only element! which influences consumers, perceptions
of the recovery process. /lso it is found that negative aspects have a great influence
than the positive attri%utes on the customers, overall assessment. hen consumers
complain a%out service! they eventually form a Audgment! conseuently uncorrected
service failures create increased dissatisfaction i.e. degree of level of correction is
direction proportional to the customers level of satisfaction.
Sachin Gupta et al (2004;
demonstrate a methodology to uantify the lins
%etween customer satisfaction! repeat5purchase intentions! and restaurant
performance. The authors has constructed a series of mathematical models using the
data from a national restaurant chain! that predict how the level of customer
satisfaction with certain attri%utes of gusts, dining eperience affects the lielihood
that they will come %ac. The authors constructed two different models for this study.
The first one is to eplore the relationship of guest satisfaction with twenty5one
distinct attri%utes of the dining eperienceK the second model to eplore the
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relationship %etween restaurant performance and customers, reported lielihood to
return. The study shows how guests, "come%ac& scores and other varia%les affect
restaurant performance. The authors argue that higher customer satisfaction should
lead to increased pro%a%ility of repeat purchase! which in turn should result in greater
restaurant sales. The study attempts to fill a gap in the empirical literature that
focuses on the restaurant sector %y lining customer satisfaction to restaurant
performance.
'llen ?ay and Celvin :. ras (2000*
argue that if customer satisfaction is
viewed as an outcome! then focusing discussion on its antecedents is also necessary to
effect the desired outcome. The purpose of the paper is (1 to present the synthesis of
the value5related literatures and postulates summari$ing etant nowledgeK (2 to
descri%e the proposal to re5conceptuali$e the value assessment process in terms of
perceived risK and ( to present suggests for future research. The authors claim that
they are the first to suggest the lin %etween value and dissatisfaction. The authors do
not intend to imply that customers perform a formal analysis in which potential
received %enefits are compared with reuired resource ependitures! %ut claim that the
consumers consider the lielihood of "(1 a product performing the function desiredK
(2 physical harm or inAury ensuing from product useK ( gaining approval of othersK
(7 achieving a sense of self5efficacy! and=or (9 wasting money! time or effort in
maing a particular choice& (p.9;. inally the study concludes! "raming value in
terms of perceived ris not only facilitates a %etter understanding and measurement of
value %ut also %etter ena%les the mareting manager to enhance the perceived value of
a product or service. Bn nowing how to manipulate value the mareting manager in
turn has nowledge essential to satisfying customers& (p.9;.
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/ccording to Cohsin et al (200970
today,s hotel guests epect uality service!
product! atmosphere! entertainment! value for money! reuire high uality eperience
from their stay in hotel. The authors discuss the significance of service uality and
customer satisfaction! and undertae a service uality assessment of hotels in ?arwin
in the Horthern Territory of /ustralia as perceived %y their customers. The authors
further analyses and discuss the response of 17* respondents a%out their epectations
from a stay in 75star hotels. The study finds that 10 per cent of the sample epressed
degrees of dissatisfaction a%ove average and it is suggested that these complainers
may act as indicators for management. The study cites that within the literature
relating to hospitality and catering! significant attention has %een paid to issues of
service uality. The reasons for this! the authors su%stantiate are that "ustomer
satisfaction is a determinant of profita%ility and lie other service industries
hospitality research is focusing on the relationship %etween customer satisfaction!
repeat sales! and %usiness profits.
Faurette ?u%I and Feo C :enganathan (200071
sums up that to develop loyal
guests! managers must give guests value during their hotel stay %y giving outstanding
service. The authors identified particularly positive aspects of the hotel stay noticed
%y the guests as visi%le sources of customer value! and discussed these in relation to
the %usiness strategies stated in the manager,s interviews as the primary reasons for
their success. The study focuses on specifically identifying those hotel attri%utes that
drive value in lodging purchases. or this purpose the authors have defined value as
customers, perceptions that specific hotel attri%utes have fulfilled their needs during
their hotel stay. Bt is pointed out that an effective distri%ution system that maes
rooms easily availa%le was the most freuently mentioned mareting factor driving
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purchase! followed %y freuent5stay programmes. urther advocate that a tremendous
loyalty payoff seems to occur when a hotel creates visi%le customer value during
every stay. The findings on the attri%utes that create visi%le value are %ased on the
22 customer5respondents who reported recalling that their hotel created such value.
Bnterpersonal and functional aspects of service were also important sources of
customer value during the hotel eperience.
Eay Dandampully and ?wi Suhartanto (200072
conducted a research study on
the customer loyalty in the hotel industry. The o%Aective is to identify factors of
image and customer satisfaction! which are positively related to customer loyalty in
the hotel industry. The research helps etend the understanding the relationship
%etween customer loyalty! customer satisfaction! and image. The study identifies that
competition has three maAor implications for the customer! which provides- increased
choiceK greater value for moneyK and augmented levels of service. The authors argue
that hotels that attempt to improve their maret share %y discounting price! however!
run the serious ris of having a negative impact on the hotel,s medium and long5term
profita%ility. The study advocates that a dedicated focal point on customer loyalty is
liely to %ecome a crucial precondition for the future survival of hotel organi$ations.
Jsing the data collected! the findings signify that hotel image and customer
satisfaction with the performance of houseeeping! reception! food and %everage! and
price are positively correlated to customer loyalty > whether a customer will purchase
and=or recommend. The study further illustrates that customer satisfaction with
houseeeping as the only significant factor that determines customer loyalty. This
argument is supported %y an eplanation that houseeeping! from a customer,s
perspective! represents the core %enefit of a hotel! while reception! food and %everage!
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and price are regarded as supporting factors. The study suggests that %oth image and
customer satisfaction should %e included when measuring customer loyalty.
The study conducted %y Tat ). hoi and :aymond hu (20007
to analyse
the levels of satisfaction among /sian and estern travellers investigates the
perceptions a%out the service uality of 8ong Dong hotels. The study identifies seven
hotel factors out of hotel attri%utes and determines the levels of satisfaction with a
3/:BC/L rotation techniue. The o%Aectives of the study are- 1 To develop the
underlying dimensions of hotel attri%utesK and 2 To eamine the relative impact of
the derived hotel factors in influencing the satisfaction levels of %oth /sian and
estern travellers.
Ga%%ie et al (1**677
have conducted a study to investigate the relationship
%etween uality service and customer epectations in the Horthern Breland hotel
industry. The study was conducted in two hotels in Horthern Breland using the
S':3MJ/F. Core specifically the paper tries to identify the service gaps. Two hotels
with different management were selected for the research study. Muestions for data
collection were %ased on the service uality gap model.
The %usiness traveller has an important segment with the hotel industry.
:oger E. hallan and Ga%rielle Dyndt (200179
have analysed %usiness travellers,
customer satisfaction %ased on various hotel attri%utes with different categories of
hospitality customers! especially %usiness travellers and reviewed various literatures
and surveys on hotel attri%utes. / preliminary review was made to identify the
perceived importance of hotel attri%utes from the %usiness traveller point of view.
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The uestionnaires used for the survey was %ased on these important attri%utes. or
the purpose of this survey! the authors %ased the selection of attri%utes on allan
(1**6 and at the same time the findings of other authors were also considered. Two
international five5star hotels were selected for this study > one from @russels and the
other from Canchester. The paper illuminates the following attri%utes as the most
important- 1 Security (* per centK 2 :eservation relia%ility (;* per centK
Muietness of room (;4.2 per centK 7 Physical condition of the hotel (; per centK
and 9 location (;1 per cent& (p.19. The study finds +location, as the most important
attri%ute for the %usiness travellers of Canchester customersK car paring was less
importanceK restaurant and food availa%ility scored middle order significance. The
study also identifies a num%er of differences in the epectations %etween the
international and @ritish %usiness traveller.
The paper %y :eginald C. Peyton et al (20076 presents a review of literature
prior to the 1**0s related to the areas of consumer satisfaction = dissatisfaction
(S=?. Bt addresses %oth the theoretical and measurement5related issues involved in
these areas of study.
The study %y Eulie eicert et al (200674 is %ased on the concept of
acceptance to pay etra for certain security measures provided %y the hotel. @ut
interestingly the willingness to pay for the security features decreases as the
respondent guest,s age increased. The authors claim that women were more
supportive of strong security measures than men. The study also eamines the etent
to which guests would accept increases in room rates to pay for any of these features.
urther points out that "the magnitude and location of the *=11 attac on Hew )or
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ity deeply altered travellers, perceptions of safety. The study was %ased on responses
from *0 respondents of different category. The sample was evenly divided %etween
men and women with age group ranging from fourteen to seventy5 eight years. The
study finds that respondents were less accepting of over security measures and non5
acceptance of across5the5%oard installation of metal detectors and armed guards. The
study concludes! "8otel guests generally accept the practice of reuiring photo
identification of guests at chec5in! video surveillance in pu%lic areas! and adding
first5aid its to guest rooms. /t the same time! metal detectors! o%vious presence of an
armed guard! and checing guests, identification against law enforcement records
were generally less accepta%le.&(p.272
8alil Hadiri and Dashif 8ussain (20097;
eamine the tolerance $one of
customers, service and determine the level of customer satisfaction in Horthern
yprus hotels. The study was conducted at four5star! five5star and resort hotels. The
findings demonstrate that the customers, evaluation of service uality in Horthern
yprus hotels has two dimensions- tangi%les and intangi%les. The findings show the
eistence of a narrow $one of tolerance among the customers. The results also
confirm that evaluation of services can %e scaled according to two different types of
epectations- desired and adeuate. /ccording to the outcome of the study "gap5
analysis measurement scale is an indicator for measuring customer satisfaction&
(p.24. /lso critically analyses "how mareting strategies can %e designed to
manage adeuate service5level epectations! the role of predicted service in
influencing how consumers evaluate service uality! and how the hotel industry can
use the $one of tolerance concept to formulate mareting strategies effectively&
(p.247. The study emphasi$es that the terms +satisfaction, and +uality, have %een
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central in hospitality managementK managers should eep the service level a%out the
customers, desired epectationsK and use of $one of tolerance method provides useful
information to managers for developing uality5improvement strategies.
Darnieya @udhwar (20077*
conducted the research to evaluate the crucial
factors that would impact the restaurant,s success or failureK to identify the gaps
%etween management,s and the customers, perceptionsK and to analyse choice of
cuisines > mainly attri%uted to commercial customers and their %ehaviour. The study
covered 7; restaurants. The study o%serves hygiene and sanitation! location! access!
paring and visi%ility! music! supplier,s uality consistency! food cost! design and
dIcor as important varia%les that impact the success of a restaurant. The author
suggests that the operators need to reali$e the level of competitionK it is important to
conduct periodic surveys through customer trail mapping and other such techniuesK
the operators should reali$e the value of courteousnessK and finally the potentiality of
we%sites as mareting should %e capitali$ed.
Eohn . <,Heill and Mu Liao (200690
! %ased on the notion that a hotel,s
%rand contri%utes significantly to its maret value analysed the various factors and
implications. The study eamines the relationship %etween the maret value and the
%rand effect from the investor5owner perspective. The study used /nalysis
ovariance (/H<3/ to eamine the effect. The authors opine that this was the
first study to empirically eamine the relationship %etween specific hotel %rands and
maret values. The findings show that %rand affiliations contri%ute significantly to
the variances of hotel values.
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/ccording to Pei Cey Fau et al (200991
! hotel customers, perceptions of
service uality provided %y the hotel industry were lower than their epectations and
there eists a significant gap %etween customers, epectations and perceptions. The
survey was conducted in the Calaysian hotel industry with four5star or five5star
ratings among the travellers who stayed at the five selected luury hotels in the Dlang
3alley! Calaysia. The primary o%Aectives of the study are- "to determine the service5
uality attri%utes that constitute fundamental service5uality dimensions in evaluating
hotel operatorsK to eamine and to compare relative importance attached %y customers
in terms of their epectations and perceptions %y type of hotels (four5star or five5star
hotelsK and to identify the role of service uality towards customer satisfaction in the
hospitality industry& (p.74. The relationship %etween overall satisfaction levels and
the five service5uality dimensions vi$. relia%ility! responsiveness! assurance!
empathy! and tangi%ility. The study found that the hotel customers, perceptions were
consistently not meeting their epectations and that the tangi%ility factor is of utmost
importance.
Darthi Hamasivayam and Timothy :. 8inin (20092
argue that customers
should %e allowed some sense of control over the service encounter! if not employees
should act in such a way that guests perceive as fair. The authors perceive the service
encounter tantamount to interaction initiated %y a customer %etween that customer and
a service provider. The research focuses on the importance of actual customer5
employee encounter. The authors argue that the customers are unsure whether the
service provider will provide what he=she needsK and "Bf customers sense a loss of
control in the service encounter! they may have a variety of negative responses&
(p.2;. The authors identified four ey service5provider characteristics! which
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contri%ute to consumers, perceptions of fairness vi$. consideration! nowledge!
consistency! and impartiality. Bt is proposed! "there are +fairness, %ehaviours that
service worers can act out that affect a customer,s satisfaction and intent to
repurchase ## such employee actions may su%stitute for consumers, loss of
perceived control& (p.2*. The study was %ased on three hypotheses- "Those
individuals who perceived more control of the service encounter would say that they
are more satisfied with the echange and would %e more liely to patroni$e that
enterprise againK Those individuals who eperienced more fairness in a service
encounter would epress greater satisfaction and the intent to returnK hen a service
echange creates low perceptions of control! service worers, fair %ehaviour could
have a compensatory effect on the level of satisfaction and intent to repurchase&
(p.2. The results support the first and second hypothesesK all the four perceptions
(consideration! consistency! impartiality! and nowledge have significant correlation
with satisfaction. The authors insist that customers should %e made nown that they
can influence the %ehaviour of service providers.
Smith! /.D. et al (1***9
uses a mied5design eperiment using a survey
method. The concept of the research is %ased on the notion that +customers often
react strongly to service failures! so it is critical that an organi$ation,s recovery efforts
%e eually strong and effective,. The first o%Aective of the study is to develop a
comprehensive model of customer satisfaction with service failure=recovery
encounters. The second o%Aective was to determine the effects of specific
failure=recovery antecedents on customers, evaluations. /nd the third o%Aective was
to provide managerial guidelines for effectively responding to customers %y
esta%lishing the proper fit %etween a service failure and the recovery effort. The study
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used a model of customer satisfaction! developed %y the authors! with service
failure=recovery encounters %ased on an echange framewor. or this the authors
have preferred two different service settings vi$. +restaurants, and +hotels,. The
authors argue that "when a service failure occurs! the organi$ation,s response has the
potential either to restore customer satisfaction and reinforce loyalty or to eacer%ate
the situation and drive the customer to a competing firm& (p.96. The authors view
that economic and social interaction %etween the customer and the organi$ation can
%e triggered %y a service failure=recovery encounter. The findings of the research
provide organi$ations with guidelines for developing service recovery procedures that
improve customer service and enhance customer relationships.
oring paper presented %y :ooma (200497
enlightens that customer
satisfaction evaluation is vital for all service firms for %etter performance in the
present world of competition. The paper analyses whether S':3MJ/F dimensions
would %e applica%le to hotel industry and put forward some additional dimensions
pertinent to hotel sector. The tourists visiting the tourist villages at different parts of
the island were taen as sample for their study through open5ended uestions on their
epectations of service uality availa%le at their hotels. The findings show that the
most important attri%ute represented in the S':3MJ/F instrument was the core
service. <ther attri%utes identified were- hotel room dIcor and cleanlinessK Bnternet
access in hotelsK uality of food and recreational facilitiesK and modern technologies!
particularly in communication facility. The study suggests that "ays of achieving
uality service could include the administration of hotel customers satisfaction
surveys using the service uality dimensions involvedK the improvement of the level
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of service performance where needed %y filling the gaps and the management of
epectations regarding uality of service& (p.2.
Thania ?evi Euwaheer and ?arren Fee :oss (20099
carried out a study with
the o%Aectives that "to assess the customers, epectations and perceptions of uality in
hotels of Cauritius and to identify the gap (if any %etween those epectations and
perceptions and to identify and compare the perceptions of hotel managers who are
responsi%le for managing uality and the customers in these hotels who eperience
and Audge it& (p. 106. The study used a modified version of S':3MJ/F instrument
to assess the uality of target hotels. The survey used Fiert5type scale from 1 (very
low epectation to 4 (very high epectation. The study identifies nine service
uality dimensions with 6 varia%les. Cost of the perceptions scores were found to
%e lower! ecept privacy to the guests and appealing promotional %rochures. The
gaps in service uality dimensions and etra5room facilities were found as largest and
smallest respectivelyK and all the nine perception scores were lower than the
epectation scores. The overall result found was that "hotels in Cauritius are not
meeting tourists, epectations& (p.10*. The study epose two o%stacles %eing faced
%y the hospitality industry managers as- 1 "they do not now what aspects the guests
considers to %e important when evaluating the hotel eperienceK and 2 they do not
have relia%le and valid instruments for measuring service uality perceptions&
(p.112.
The research study of Cahdavinia Seyed 8essamaldin (200496
illustrates that
tourist industries have turned into one of the most profita%le sources of income
throughout the world especially in the last decade of the second millennium. The
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research aims to investigate the customer satisfaction! in application of S':3MJ/F
model among the two! four5star hotels in Bsfahan. The findings reveal that hotel
guests, perceptions of the offered services were %elow the epected average level > an
inde indicating that none of these hotels in Bsfahan has an optimal service uality.
Grigoroudis! ' and Sisos! ) (200*94
discuss the customer satisfaction
evaluation pro%lem. The authors provide three classifications of customers- (1 "Self5
unit customers > individuals of self unit customers with self inspection! disciplined
attitude! and a desire to ecellence! (2 Bnternal ustomers > who are personnel within
an organi$ation! and ( 'ternal customers > represented %y the %uyers or users of
the final products and services of the %usiness organi$ation& (p.*. The authors
present an overview of eisting methodologies and also the development and
implementation of an original method du%%ed CJS/ (Culticriteria Satisfaction
/nalysis. This method! the author claims! aims to provide an integrated set of results
capa%le of analy$ing customer needs and epectations and to Austify their satisfaction
level. The %oo also deals with customer satisfaction pro%lem! presenting the various
uantitative and related consumer %ehavioural modelsK uality5%ased approachesK the
CJS/ method and its etensions and advanced topicsK customer satisfaction surveys
and %arometersK applications of the CJS/ method in real5world customer satisfaction
surveysK and different information technology approaches related to customer
satisfaction. inally! the %oo eamines the development of a decision support tool to
help understand and apply results and methods of measuring and implementing
service uality is intended for researchers and practitioners in mareting! uality
management! and service management.
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:i$aldi and iAaya (20069;
analyse the five S':3MJ/F dimensions through
?isconfirmation theory. The theory of disconfirmation has %een used to eplain the
formation of customer perceived service uality and satisfaction. /ccording to this
theory! service uality and satisfaction result from how well the actual service
performance! in other words! the service process and outcome! matches the
customer,s epectations. Thus epectations and their management are of great
significance to perceive service uality and satisfaction. The idea of disconfirmation
has its root in 8elson,s adaptation level theory! which suggests that states of
satisfaction=dissatisfaction result from a comparison %etween one,s perception of
product performance and one,s epectation level. /ccording to widely accepted
opinion in service research! customer perceived service uality results from how well
customer epectations match actual eperiences of the service. /nd so! %ased on the
disconfirmation theory! the writers conducted a set of research upon Bntrapura
:estaurant! located at the heart of /msterdam. To gain the level of customer
satisfaction through the customer epectation and customer perception level of
Bntrapura,s service uality. The writers used five dimensions of S':3MJ/F vi$.
tangi%le! relia%ility! responsiveness! assurance! and empathy.
Fovaglio (20019*
critically analyse the satisfaction of consumers towards
products=services offeredK in the evaluation of services the conceptual models
proposed for the indirect estimate of the S go %ac to the theory of gaps %etween
service and those perceived! separately for the five fundamental dimensions of
S':3MJ/F. The aim of the paper is to propose a general model to estimate latent
varia%le customer satisfactions! which manifest categorical varia%les. The approach
amalgamates all the availa%le information a%out customer satisfaction in the structural
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models specified in the ustomer Satisfaction @arometer (S@ and /merican
ustomer Satisfaction Bnde (/SB models with gap theory of S':3MJ/F.
<fer 8. /$ar 60
analyses whether tipping would improve service uality and
increase economic efficiency! as tips are incentives to provide %est service and
conseuently allows avoiding costly supervision of worers. The study argues that
the common notion is wrong. The author illuminates the reasons for the increased
interest in tipping is that the concerned firms %enefit from %etter understanding of
various issues related tipping. Secondly! tipping has %ecome a social norm and a form
of consumer %ehaviour. The author claims that this was the first article to epose the
inconsistency %etween the two maret characteristics! i.e. tips are hardly affected %y
service uality and service uality is raned as %eing high %y customers. The study
concludes that tips are not directly proportional to service uality and additional
measures should %e employed to warrant good service uality.
Eonathan Fee et al (200661
have studied the word5of5mouth (<C and the
customer lifetime value (F3. The study is %ased on the concept that measuring the
customer value and mareting effect with reference to direct financial contri%utions
carries a potential ris of misleading the mareting managers. The study empirically
investigates the effect of <C in estimating F3. ?ata was collected from 1!7*
customers through survey and transaction measures using a 105point scale. The
survey was inclusive of level of customer overall satisfaction and <C! i.e.!
willingness to recommend. The authors incorporated the <C effect in estimating
F3 and argue that if direct financial contri%utions are alone incorporated in F3
estimation! companies run the ris of missing the latent aspect of customer value and
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thus there eists a possi%ility to misAudge customers, true lifetime value. Bt is
advocated that the indirect effects of <C should also %e evaluated to maimise the
lifetime value of customers and %ased on this investments can %e made accordingly to
augment the customers, attitude to generate positive <C.
@arry ohen (1**462
writes that the term +<, effect was coined %y him
which encompasses all the efforts that are %eing taen %y the hotel,s=restaurant,s top
management to eep the customers and employees fresh and eciting. The article
discusses the five < aspects vi$. < yourselfK < your employees- <
your customersK < your communityK and < your competition. The first
aspect < yourself concerns a%out the manager,s should have an environment to
thin as strategists and futurists and to < themselves with creative ideas. The
second aspect! < the employees is nothing %ut empowerment of employees
through financial and psychological ownership. The third factor! < your
customers is eplained %y the author as doing things the right way! and it applies Aust
as much to service as to food. < your community! which is the fourth factor is
the effective community reach i.e. learning a%out the diverse communities! their needs
etc. /nd finally! < your competition through innovative ideas and concepts i.e.
not copying the successful new ideas that is usually %eing followed in the maret.
Thayne orges (20046
through his woring paper on 3aluing ustomers
argue that one of the important intangi%le assets of any %usiness is the value of
customers. The fundamental methodologies for valuing customers are eplained and
their limitations are also considered. The value of customer is %roadly defined as +the
value that customers generate for the %usiness, and alternatively! the +value of
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relationship, The study suggests that Porter,s value chain can %e used to analyse how
customer relationships create value. The author claims that there are delicate
differences using %rand value as a su%stitute for the value of customer even though
they seems to appear similar. The study suggests the following common approaches
for valuing the customer related intangi%le assets- 1 ost approachK 2 Caret
approachK and Bncome approach. The cost approach is %ased on the level of cost to
%e incurred to create value. The second approach measures the open maret
epenses! while the income approach is %ased on the level of income the asset would
generate. The study also illustrates the limitations of all the three approaches. The
cost approach is distorted %y time value of money and the evolvement of the
competitive environment. The availa%ility of sufficiently compara%le transactions is
identified as the primary weaness of the maret approach. The income approach is
complicated to carryout. The study concludes that since customers are the reason for
the eistence of a %usiness! sill for managing their customers profita%ly is crucial.
8olAevac! B./. et al (200067
in their woring paper argue that one of the
%iggest contemporary challenges of management in service industries is providing and
maintaining customer satisfaction. The study eamines hotel Guest omment ards
(Gs and customer satisfaction management schemes in 29 hotels in <patiAa,s!
through the +/pplied content analysis, approach proposed %y 8orsnell (1*;;. The
authors argue that though several tools are availa%le for measuring customer
satisfaction in hotels! one of the most popular is Guest omment ard. They
su%stantiate that this method has the advantages of small si$e! easy distri%ution! and
simplicity. The G checlist consisted of 2 categories which were grouped under
five general areas of analysis vi$. (1 focus and management value of G attri%utes!
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(2 G attri%ute measurement techniues! ( G measure of overall customer
satisfaction and loyalty! (7 G mareting measures! and (9 effective layout of
uestions. The study com%ines an analysis of customer satisfaction management
schemes and Gs content analysis in the selected hotels. The authors conclude that
efficiency of customer satisfaction measurement with Gs! depends on the
measurement methodology and valua%le information for management decisions
regarding a hotel,s offering can %e o%tained only through relia%le and valid data.
The paper presented %y Sutanto (200*69
at the Bnternational Seminar on
Bndustrial 'ngineering and Canagement %uilt the model of customer satisfaction on
the %asis of survey and choice data collection %y interviews. The outcome of the
study reveals that full service hotel owners and managers should focus on the
following three maAor elements of service uality- technical or outcome dimension!
functional or process related dimension! and corporate image. The result highlights
that the varia%le technical or outcome dimension of service uality was most
important to customers. The author argues that the model used for assessing customer
satisfaction in the full service hotel industry is a useful one. The study suggests that
"hotel owners! who truly want to gain a competitive edge! must continually strive to
increase the levels of customer satisfaction %y emphasi$ing the three significant
factors discerned in this study (mentioned a%ove as suggested %y the transaction5
specific model& (p. /.112.
:oya :animi (200466
presented a thesis on the feasi%ility study of ustomer
:elationship Canagement (:C application in hotel industry. The research study
was conducted on the contet that with increased glo%ali$ation! competition! higher
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customer turnover! growing customer acuisition costs and rising customer
epectations in today,s competitive word! :C is very important for companies. The
scholar argues that the study emphasi$es application of :C in hotel industry %rings
increase in the rate of retention! increase revenue and profita%ility! reduce internal
costs! reduce mareting costs! improving customer services! create positive word of
mouth! maret growth! improve mareting methods! streamlines %usiness process! and
finally protects mareting investment and maimi$e returns. The study outlines the
four "P&s! reuired for a successful :C initiative- Profiles! Preferences! Precision!
and Property and points out +management commitment to em%racing :C as a way
of doing %usiness as the fifth most important element and su%stantiate this argument
that without deep and confirmed leadership! this ind of initiative will go nowhere.
The study finds that customer satisfaction will cause customer loyalty and retentionK
customer retention is important for %usiness and customersK successful
implementation of :C will increase rate of retention! increase in revenue!
profita%ility! reduction in internal costs! reduction in mareting costs! positive word of
mouth! %etter understanding of customer reuirements! and higher employee
productivity and concludes that all these %enefits for a hotel can %e a source of long5
term and sustaina%le competitive advantage.
Calthouse! '.. et al (20064
eamine customer satisfaction across
organi$ational units in their woring paper. The research paper discusses various
customer satisfaction models for assessing the relationship of overall satisfaction with
a product or service and satisfaction with specific aspects of the product or service for
organi$ations having multiple units or su%units. The study critically eamines
whether the drivers of overall satisfaction vary across such units and if so! proposes
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how additional varia%les can %e included in a model to account for the variation. The
research eamines the hypotheses that different su%units within an organi$ation or
industry may show different relationship %etween specific aspects of satisfaction and
overall satisfactionK in other words! there may %e different utilities for the specific
aspects of satisfaction. The authors argue that variation in the specific5general
satisfaction relationship across organi$ational su%units also has important theoretical
implications for satisfaction research and stress the importance of eplaining the
variation effects across units or su%units. i.e. for one su%unit! some specific type of
satisfaction may %e strong predictor of overall satisfaction! while for another su%unit
the same specific type of satisfaction may have little or no relationship to overall
satisfaction. The study assumes pre5defined su%units. urther illuminates that the
attri%utes can have different satisfaction implications for different customer and
maret segments. The study concentrates on newspaper and healthcare industries.
or each of the industries! etensive case studies had %een developed through
measures of overall satisfaction and satisfaction with specific attri%utes. The study
indicates the need for richer theoretical hypotheses including more varia%les and also
the utility of methodology used for studying the variation in effects across su%units.
The authors epound with appropriate illustrations to highlight the situations where
there is no significant variation across su%units as well as situations where such
variation eists.
Husair et al (20106;
in their study investigated the effects of price discount
frames and price discount levels on consumer perceptions a%out the uality of the
service product! the value of the discount! their purchase intentions etc. The research
study included restaurants! hotels! mailing service! and retail services. The study
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showed that price discount frames and discount levels do affect consumers,
perceptions on the value of the discount and the uality of the service.
Peter Eones and Cichael ?ent (1**76*
had conducted a research study on the
customer attitudes to waiting times in the hotel and restaurant industry %ased on
Caister,s "Psychology of aiting Fines&. The study was conducted with a sample of
100 customers > show that customer %ehaviour is affected %y the length of time they
have to wait. The study compares customer attitudes and the firm,s a%ility to deliverK
eplains specific eamples of developments in service systems design and delivery in
%oth hotels and restaurants.
enAing Shang and Heal 8. 8ooer (200640
in their woring paper use
survey data to determine consumer preferences among a set of four alternative food
la%els which report such plant level performance scores. The authors study the
product la%el reports of food producers, hygiene performance and eplore consumer
preferences for the +right, amount of information and how to present this information.
The authors carried out the study to verify the following hypotheses- 1 Bn terms of
presentation format! consumers prefer num%er system than other visual or ver%al
systems! 2 /mong the three different levels of information volume sets! consumers
don,t always prefer the largest volume set! and Ho matter what their preferences
are! consumers are consistent with their information volume preferences. The survey
was carried out through mail.
Eessica Salver (200*41
in her %oo traces out the lin %etween the %rand name
and the customer loyalty. The maAor o%Aective of this wors is to eamine the concept
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of %rand management! to adapt and apply it to hotel services! since! the author argues!
customer loyalty is a hot topic in today,s ultra competitive %usiness environment. The
second o%Aective of this study is to determine the connection %etween these two
concepts and to investigate the %eneficial effects of %randing hotel services for the
process of esta%lishing loyalty. The author cites that the original idea of using mars
to indicate ownership and origin can %e traced %ac even for millennia to ancient
Gree and :ome and early hinese dynasties. Core and more %usinesses have come
to reali$e the power and important of %rands and the concept of %rand management
has conseuently gained considera%le interest in recent years. The author further
advocates that the hotel industry > along with many other services > is lagging %ehind
manufactured goods %y decades and nonetheless! there are great potentials for %rand
management in the service industry in general and the hotel industry in particular. /s
the hotel industry differ from physical goods in many ways! it is vital to eamine the
concept of %rand management > to adapt and apply to hotel industries. The author
further argues that as competition eeps intensifying at steady pace! resulting in a
surplus of capacities! the importance of maing guests return %ecomes a critical issueK
it is said that %rands provide the opportunity to encourage the creation of loyalty
among consumers.
:esearch study %y Helson Tsang and 8ailin Mu (200042
analyses the
perceptions of service uality in hina,s hotel industry from the perspective of %oth
international tourists and hotel managers. The sample contained *0 hotel managers
and 240 international tourists! stayed at various hotels in @eiAing! Shanghai! and
Guang$hou. The study was conducted with the following o%Aectives- 1 To assess the
current epectations and perceptions held %y international tourists with respect to the
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uality of services and products provided %y the hotel industry in hinaK 2 To assess
the current epectations and perceptions held %y hotel managers in hina with respect
to uality of hotel service and products providedK and To identify any gap %etween
the perceptions of tourists and hotel managers! with respect to the uality of hotel
service and products provided. The study advocates- "The gaps %etween tourists and
hotel management could %e %ridgedK there is room for service uality improvement in
the hotel industry in hinaK managers are too self5assured and somewhat o%livious to
their failings in delivering what tourists epectK and therefore! the necessary first step
in improving the service uality is for managers in the hotel industry in hina to
acuire accurate information a%out the driving forces&.
'dwin H. Torres and Sheryl Dline (20064
in their article! see to develop a
managerial model! which would assist in the successful management of customer
relations. Their study descri%es the concepts of satisfaction and delightK their
%acground and potential outcomes.
Ciguel Bgnacio Gome$ et al (20047
conducted a study to measure the lins
%etween store attri%ute perceptions and customer satisfaction! and %etween customer
satisfaction and sales performance in food and retail sector. The study includes the
measurement of compleities of the satisfaction5sales performance lins %ased on
empirical model of first differences. The study epounds that customer satisfaction is
vital to the creation of a successful %usiness strategy. The study cites that /nderson
and Sullivan (1** addressed the simultaneous estimation of antecedents to and
conseuences of customer satisfaction. Their model identifies factors that determine
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customer satisfaction! which in turn have a positive association with financial
performance.
Stephen @all et al (200449
present a detailed historical development of the
Bndian hotel sector. The authors claim that the Bndian hotel sector is in a period of
rapid growth and change %ecause of the rapid epansion of %usiness activities! which
is the result of the fast growing Bndian economy. The %oo illustrates that there were
a%out 19!000 tourist5arrivals in Bndia in the 1*90s! followed %y a %oom in 1*;6 with
an inflow of a%out one million tourists. The %oo further claims that tourism and
hospitality industry in Bndia employs 29 million people and this will grow to 100
million people in the net 29 years and Bndian hotel industry accounts for 90 per cent
of all foreign echange in Bndia thus has %ecome an economic importance. The
authors point out that there is a mismatch of supply and demand in certain areas of the
hospitality industry in BndiaK wea la%our maret is characterised %y ecess la%ourK
and the current curriculum offered %y universities on hospitality education does not
address the glo%al issues.
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