An examination of the relationship between customer loyaty, customer satisfaction, and image in the hotel industry

Abstract

Customer loyalty constitutes the dominant factor in a business organization's success. This research serves to add to the knowledge in service marketing literature by improving understanding of the relationship between customer loyalty, customer satisfaction, and image in the hotel industry. The objective of this research is to identify the factors of image and customer satisfaction positively related to customer loyalty in the hotel industry. Using a model of the relationship between customer loyalty, customer satisfaction, and image developed in this research, nine hypotheses on the relationship between these factors were formulated. To test the hypothesis, data were collected through questionnaires distributed to 220 guests of chain hotels in Christchurch. Regression analysis methods were used to test the hypotheses and to identify the factor of hotel image and customer satisfaction related to customer loyalty.

The findings indicate that hotel image and customer satisfaction with hotel performance are positively correlated to customer loyalty. Moreover, the results show that hotel image and customer satisfaction with food and beverage, reception, housekeeping, and price are important factors in determining a customer's intention to repurchase, to recommend, and demonstrate loyalty. Although all of these determinants are important, the results show that hotel image and customer satisfaction with housekeeping are the main considerations in a customer's intention to repurchase, to recommend, and to exhibit loyalty to a given hotel chain.

This research makes a contribution to the service marketing literature by extending knowledge on the relationship between customer loyalty, customer satisfaction, and image. Firstly, this is an empirical research which attempts to improve current understanding of the relationship between customer loyalty, customer satisfaction, and image. Secondly, this research attempts to address and enhance understanding of the factors of image and customer satisfaction related to customer loyalty in the hotel industry. From practical perspective, this research will benefit hotel managers by highlighting those issues requiring management focus. Further, this research offers a source of guidance to future researchers on the development of customer loyalty.