Critically Evaluate Quality of Customer Service through the Level of Customer Satisfaction in Hospitality Industry

by

ABSTRACT

The main focus of this study is to critically evaluate the quality of customer service of customer satisfaction in hospitality industry. Given the strategic importance of service quality and related concepts in hotel industry, this paper investigates guests' satisfaction and their loyalty in hotels of the Opatija Riviera (Croatia). The aim of the study is to identify levels of guest satisfaction and guest loyalty, as well as to determine the nature of the effect of socio-demographic variables on hotel guest satisfaction. The empirical research was conducted using primary data. Questionnaires were distributed to domestic and international tourists staying in Opatija's hotels. At the end, 253 valid questionnaires were gathered. In order to achieve the survey's goals, descriptive and bivariate statistical analyses were performed. Empirical findings indicate that hotel guests are most satisfied with the reception department. What is more, the level of loyalty is high. The findings of this study indicates that Opatija Riviera (Croatia) provided quality services and guests are highly satisfied with the services. The guests of Opatija Riviera (Croatia) are willing to revisit the hotel because they are satisfied with the services. Most of the guests visit Opatija Riviera (Croatia) for vacation and business deals. The findings of bivariate analysis depicts that customer satisfaction is highly influence by the quality of services provided to them by the hotel. The customer retention ratio is quite high for Opatija Riviera (Croatia) hotel because their customers are loyal.

TABLE OF CONTENTS

ABSTRACTII

ACKNOWLEDGEMENTVI

CHAPTER # 1: INTRODUCTION1

Background of the Study2

Problem Statement5

Aim6

Objectives7

Rationale of the Study7

Research Hypothesis9

Significance of the Study10

Definition of Terms11

Implication of the Study12

Contribution of Research15

Thesis Disposition16

Chapter I: Introduction16

Chapter II: Literature Review16

Chapter III: Methodology17

Chapter IV: Data analysis and Discussion17

Chapter V: Conclusion17

CHAPTER # 2: LITERATURE REVIEW18

Introduction19

The Importance of Customer Loyalty in the Hotel Industry19

A Definition of Customer Loyalty20

Consumer Behaviour23

Customer Satisfaction (CS)24

Brief History of CS Research28

Definition of Satisfaction29

Theoretical Underpinnings31

Expectancy Disconfirmation31

Assimilation Theory (Cognitive Dissonance)32

Contrast Theory33

Assimilation-Contrast Theory33

Equity Theory34

Attribution Theory35

Comparison-Level Theory37

Generalized Negativity Theory37

Value-Percept Theory38

Service Quality (SQ)39

Brief History of SQ Research40

Conceptual Issues42

Discriminant validity of expectations42

P-E conceptualization43

Relationship between SQ, CS, and attitude45

Summary46

CHAPTER # 3: RESEARCH METHODOLOGY48

Introduction49

Mixed Research49

Classification of research methods50

Multi-method studies50

Mixed method studies50

Steps in mixed methodology50

Strength and weakness of the mixed research:51

Strengths51

Weaknesses52

Research Design52

Pilot Testing53

Questionnaire and Survey Methods53

The instrument53

The sample and sampling procedure54

Data analysis54

Ethics58

CHAPTER # 4: FINDINGS59

Introduction60

Results of descriptive statistical analysis60

Demography of Respondents60

Customers Level of Satisfaction68

Expectations of Customer about Opatija Riviera (Croatia)72

Perceptions of Customer about Opatija Riviera (Croatia)77

Expectations of Customer about Opatija Riviera (Croatia)81

Importance of Opatija Riviera (Croatia)86

Bivariate statistical results91

One-Way ANOVA91

T-test92

Summary93

CHAPTER # 5: CONCLUSION AND RECOMMENDATIONS94

Recent Developments and Future Directions of CS Research97

Recommendations98

Limitations and Suggestions for Future Research99

REFERENCES103

APPENDIX123

Questionnaire123

ACKNOWLEDGEMENT

My thanks go out to all who have helped me complete this study and with whom this project may have not been possible. In particular, my gratitude goes out to friends, facilitator and family for extensive and helpful comments on early drafts. I am also deeply indebted to the authors who have shared my interest and preceded me. Their works provided me with a host of information to learn from and build upon, ...