Customers Brand Equity and Customer Loyalty - Research Proposal Example

?Research Methods Table of Contents Table of Contents 2 0.Introduction to the Problem 3 2.0.Literature and Secondary Data 4 3.0.Conceptual Framework: Concept Table and Map 9 3.1.Research Questions 9 3.2.Conceptual Model 9 4.0.Research Design 12 5.0.Conclusion 13 References 14 1.0. Introduction to the Problem Customer loyalty can be identified as a conceptual paradigm which focuses on the retention of customers by delivering quality services. Apparently such achievements require better alignment with customer needs and the procured services to generate customer loyalty which can further be established maintaining continuous contacts with customers through effective Customer Relationship Management (CRM) techniques (Customer Loyalty Institute, n.d.). Contextually, enhancing and preserving customer loyalty is considered to be the key objective of CRM initiatives performed by modern day organisations, which is deeply rooted to the concept of relationship marketing. The objective of relationship marketing is to convert new customers into regular one through providing greater service quality that would generate greater sales and profits. Such an initiative can be observed apparently in the service industry, such as in the hospitality industry (Schneider & White, 2004). One of the major reasons for customer loyalty is delivering services of qualitative standards that could increase the proportion of loyal customers of the organization to a considerable extent (Arvato AG, 2013; Brink & Berndt, 2008). Another major factor identified in the modern day context of CRM initiatives adopted by hospitality organisations is service quality. Service quality, as a conceptual term, relates with the notion to provide services with due consideration to customer satisfaction by meeting their expectations with increased performances of employees (Khosrow-Pour, 2003). Emphasising on the relation between the concepts of customer loyalty, CRM and service quality, the research problem has been framed for this study. To be precise, the research problem to be considered in this study will focus on the impact of customer loyalty and service quality in 5 Star hotels in Thailand with relation to CRM initiatives taken by the hospitality organisations. 2.0. Literature and Secondary Data Many research studies have been conducted emphasising on the concepts of service quality and customer loyalty and their relationship. As stated by Rousan & et. al. (2010), customer loyalty occurs when repeated purchase in performed by the same customers. Furthermore, the willingness for loyal customers to render product/service recommendations irrespective of outright benefits and repeated usages play a vital role in generating positive and quantifiable results for the marketers over the long run. The economic benefits of customer loyalty can be identified as improvement in the retention of employees as well as in terms of the increasing market shares of the particular brand. It can be thus stated that customer loyalty is not simply swayed by inducing the prices from competitors but also by offering better quality services to the targeted customers in comparison to the major contemporaries of the business. It is worth mentioning in this context that a positive relationship is apparently witnessed between the two aspects of service quality and service loyalty (Rousan & et. al., 2010). As can be observed from Rousan & et. al. (2010), service quality deliverance capability of an organisation can be effectively identified with due significance to the behavioural results particularly in form of complaints registered by the customers, probability of effective word of mouth promotion spontaneously by the targeted customers, switching costs and frequency depicted in customers purchasing behaviour as well as the intention of the customers to recommend further alterations for the enhancement of the services delivered. Contextually, it can also be stated that methods of service quality assists practitioners in managing the delivery of quality services effectively (Rousan & et. al., 2010). It has been apparently viewed that among various frameworks and models relating to service quality, indicating a rational and direct relationship of the concept with CRM and customer loyalty dimensions, SERVQUAL and SERVPERF has emerged as quite popular. From a theoretical perspective, SERVQUAL can be illustrated as the framework which intends to explain a precise definition of the qualitative aspects related to service quality including the factors of responsiveness, tangibles, assurance empathy along with reliability. However, there have been criticisms regarding the appropriateness of SERVQUAL as a model on the grounds of lower reliability, discriminated validity problems and unstable dimensionality. Owing to these limitations possessed by the framework of SERVQUAL, a new innovative model, known as SERVPERF has been established focusing on the effective determination of service quality only through performance measurement (Rousan & et. al., 2010). Notably, as determined in many research studies, with the application of the SERVQUAL and SERVPERF frameworks, service quality in hospitality as well as other service oriented sectors involves relationship marketing, as a technique of productive CRM, by a considerable extent (Rousan & et. al., 2010; Khosrow-Pour, 2003). From a theoretical perspective, it can be stated that relationship marketing principally aims towards establishing and sustaining relationship with customers in the long term basis. However, in most research studies such as Narteh & et. al. (2013), relationship marketing has been described as a criterion rather than a process or a strategic technique, which tends to assist marketers, not only in increasing the overall organisation’s competitive advantages but also in offering value to customers. It is in this context that through effective relationship marketing, customer loyalty and satisfaction are considered to be prerequisite for achieving customer retention. Contextually, it has been stated according to the marketing literature that customer loyalty has been arguably becoming the currency of the global marketplace in the 21st century due to increasing structural costs in acquiring new customers as compared to retaining the existing valuable customers by formulating and executing effective relationship marketing (Narteh & et. al., 2013). When assessing the service delivery process in the hospitality industry, it can further be stated that attitudes and feelings of customers through services by hotels establishes perceptions regarding service quality. Many studies have therefore been inclined towards building effective relationship between customer loyalty and service quality with greater emphasis on the service deliverance process of hospitality industry. Empirically, in their service deliverance process, 5 star hotels in Thailand are observed to render quality services of Spas and Hotel Resorts which have been attracting an increasing number of customers from the global plethora. Establishment of hassle free online communication channels for the global customers have also been observed as one of the most commonly applied relationship marketing strategies by 5 star hotels in Thailand. In this regard, taking assistance from external professional bodies, accepting recommendations from customers through proper feedback systems and taking aggressive measures in relation to e-marketing have been some of the mostly attempted and performed CRM strategies by hotels in Thailand, especially those targeting global exposure (ZDirect, 2012). Through these efforts, the marketers of hospitality services in Thailand have been able to obtain increased profits building trust and brand loyalty amid the targeted customers and retaining them over the long-run (ZDirect, 2012). From a critical perspective, it can be observed that by rendering positive experiences, hospitality organisations in Thailand have been successful in delivering effective services in a manner that resulted in greater customer loyalty. In other words, customer loyalty is directly proportionate to customer satisfaction and service quality which can be obtained through effective relationship marketing strategies (Khosrow-Pour, 2003). Customer loyalty as a subject matter in quality researches has become a significant concern for managers. As a result, increasing significance of customer loyalty can also be identified as one of the major challenges witnessed by hospitality organisations in the modern day context as can be observed from the managerial point of view. The concept of customer loyalty and service quality has been considered and identified as an area of increasing profits by various businesses on a long term basis (Ahmad &Hashim, 2011). It has been observed in this respect that modern day service oriented companies tend to measure the degree of satisfaction among its targeted customers on the basis of the features inculcated in the service deliverance process in compliance with the needs and demands of customers to yield a high score of customer satisfaction which leads to am higher degree loyalty among customers (Haghighi & et. al., 2012). The factors of personalization, trust, communication and satisfaction, apparently depends on the notion of customer loyalty for hotel business. One of the key attributes often considered by hospitality organisations when delivering quality services to the valuable customers has been the personalization of the facilities rendered. However, such measures to deliver personalization benefits in obtaining better customer loyalty has been a crucial challenge for many hospitality organisations in terms of its application as well as execution. To be precise, delivering personalised services to hospitality customers require delivering required services in a flexible and unique manner through gathered information regarding the varying needs and preferences of individual customers which is not only subjected to resource allocation, but are also dependant on the capability of the service marketers. Another variable that tends to impose strong influences on customer loyalty, service quality and likewise on the CRM approach of hospitality organisations is service satisfaction through customers’ trust. It can also be stated that the findings of this research intends towards enhancing customer satisfaction on the basis of their attitudinal loyalty and repurchase behaviour (Ranjbarian & et. al., 2011). With respect to the elaborated research problem, which is intended to be addressed in the proposed study, the required amount of relevant secondary data will be gathered in terms of historical sales and information regarding revenues earned by hotels in the modern day context. It can be stated in this regard that advertising and promotional strategies have been found to affect rapid generation of revenue and better brand positioning to yield better sustainable growth in the global market context (Lasune, n.d). In this regard, the required secondary data can be gathered through questionnaires, which has been considered in various researches emphasising on customer loyalty, service quality and CRM. Notably, surveys are found as quite relevant for describing information related to socio demographic information about respondents. Questionnaires can also assist in measuring the perceptions of respondents regarding the quality of services that are offered in the hotel (Rousan & et. al., 2010). 3.0. Conceptual Framework: Concept Table and Map 3.1. Research Questions Based on the above described research problem and the gathered secondary sources through the preliminary literature review, the below mentioned research questions have been framed which will further be addressed in the study. Question A: “What is the importance of customer loyalty and service quality in 5 Star hotels in Thailand?” Question B: “How customer loyalty and quality services can be achieved in 5 Star hotels of Thailand?” 3.2. Conceptual Model Conceptual frameworks are used in numerous ways, taking into account various practices that might be more or less descriptive depending on the research type undertaken. The activities in a conceptual framework in correspondence to the needs for explanatory and descriptive researches are generally well developed and less elaborative in nature as compared to people employed in evaluative researches. Conceptual frameworks play a pivotal role in recognizing knowledge constraints and directions for research in the future. The functions of conceptual framework thus help in formulating the research design through identification of the research problem, defining its various dimensions and assessing the concepts aligned with the identified research problem (Thongrattana, 2012). Notably, the functions of conceptual framework can also be described as the gatheration of various phases of the research process and linking the research problem with existing literature studies as well as wider issues to obtain a broader paradigm. Conceptual framework also signifies the relationship between variables and concepts that are selected for representing the phenomena that is to be accomplished through the study intended to be conducted (Pearce, 2012; University of Nebraska-Omaha, 2011). The conceptual framework as depicted earlier comprises of various related determinants that include identifying, clarifying and conceptualizing the concepts to factors of customer loyalty and service quality and their impacts on 5 Star hotels in Thailand. The intended study also will emphasise on how these aspects are to be obtained effectively by 5 Star hotels in Thailand. With reference to the above demonstrated conceptual framework, varieties of hypotheses and assumptions relating to the factors inherent to the identified research problem can be tested and recognized. Outcomes from such hypothesis testing would further facilitate in understanding how the hotels in Thailand tend to use CRM practices to obtain customer loyalty and services quality advantages by reducing the factors of uncertainty and improving overall organisational performances. In framing a conceptual framework particularly for the purpose of the study, various factors including the improvement of customer retention, increase of shares, word of mouth responsiveness, assurance, tangibles, and empathy can be considered significant aspects in terms of SERVQUAL and SERVPERF will be considered in the research study. Performance measurement, retention of customers, various marketing strategies, increase in sales and revenues can also be considered as important aspects in maintaining customer loyalty and service quality in 5 Star hotels in Thailand which will further be recognised in the study and thus would be included in its conceptual framework. 4.0. Research Design The research design of the proposed study would be formulated on the basis of quantitative methods which will be based on empirical investigations implying the process of research conducted on the description of existing literature studies and conceptual framework of the research problem related to the interdependent relationship of customer loyalty and service quality in 5 Star hotels in Thailand. The research design of the study will therefore be based on the primary sources of survey and questionnaire involving the guests in 5 star hotels of Thailand as respondents along with interviewing the managers of few hotels. Moreover, research will be conducted on the basis of scaling technique by grading the perceptions of the guests concerning loyalty and service quality in 5 star hotels in Thailand which shall be effective in rewarding an in-depth, rational as well as quantitative understanding of the research phenomenon. Applying a Likert Scaling method, the measurement of five point scale provides grades which depict the determinants, i.e. strongly agree, agree, neutral, disagree and strongly disagree. In this context, descriptive statistical analysis will be helpful in measuring the perceptions deciphered by publics and guests regarding the research topic. Correspondingly, the attributes for customer loyalty and service quality will be based on the measurement of performance, retention of customers by delivering quality services and the capability of the hotels in obtaining increased sales and profitability in Thailand. Additionally, while designing the reliability and validity of the data sources used in the research which will further define the authenticity of the entire process, reputed sources will be used for conducting the research in an efficient manner. 5.0. Conclusion From the above analysis, it can be comprehended that customer loyalty and service quality is considered to be significant determinants in every business organizations, especially those related with the service oriented industries such as the hospitality industries. In this regard, the hotels in various national upfront, including Thailand has been observed to witness significant inevitable challenges in terms of quality service deliverance and competitively ensuring the effectiveness of its CRM approaches in the global periphery. It is to be noted in this regard that as per the obtained information, customer loyalty is considered to be the key objective of CRM initiatives often conducted by the hoteliers in Thailand, which is deeply rooted to service quality and the applied relationship marketing strategies by the organisation. Service Quality is also essential for every business organization in maintaining sustainability in the global market context. In this research paper, various literature concepts and data have been identified which apparently signifies the need for further studies in order to observe the rudimental elements affecting customer loyalty and service quality in 5 star hotels in Thailand with respect to the CRM strategies adopted; hence, indicating the scope for the proposed research in this paper. References Ahmad, Z. & Hashim, R., 2011. Customer’s Brand Equity and Customer Loyalty: A Study on Hotel’s Conference Market. World Applied Sciences Journal, pp. 44-49. Arvato AG, 2013. CRM Solutions – Finding and Keeping Customers. Home. [Online] Available at: http://www.arvato.com/en/services/crm.html [Accessed May 15, 2013]. Brink, A. & Berndt, A., 2008. Relationship Marketing and Customer Relationship Management. Juta and Company Ltd. Customer Loyalty Institute, No Date. What is Customer Loyalty? Home. [Online] Available at: http://www.customerloyalty.org/what-is-customer-loyalty/ [Accessed May 15, 2013]. Haghighi, M. & et. al., 2012. Evaluation of Factors Affecting Customer Loyalty in the Restaurant Industry. African Journal of Business Management, Vol.6, No. 14. pp. 5039-5046. Khosrow-Pour, M., 2003. Information Technology and Organizations: Trends, Issues, Challenges and Solutions, Volume 1. Idea Group Inc (IGI). Lasune, S., No Date. Marketing Strategies and Quality Management of Five Star Hotels In Order To Improve Its Revenue with Special Reference to Selected Five Star Hotels in Mumbai. National Monthly Refereed Journal of Research In Commerce & Management, Vol. 1, No. 4, pp. 28-36. Narteh, B. & et. al., 2013. Relationship Marketing and Customer Loyalty: Evidence from the Ghanaian Luxury Hotel Industry. Journal of Hospitality Marketing & Management, pp. 407-436. Pearce, D. G., 2012. Frameworks for Tourism Research. CABI. Rousan, & et. al., 2010. Customer Loyalty and the Impacts of Service Quality: The Case of Five Star Hotels in Jordan. International Journal of Human and Social Sciences, pp. 886-892. Ranjbarian, B. & et. al., 2011. An investigation of Influencing Factors Customers’ Loyalty in a Four Star Hotel in Iran. International Journal of Business and Social Science, Vol. 2, No. 21, pp. 243-246. Schneider, B. & White, S. S., 2004. Service Quality: Research Perspectives. Sage Publications Inc. Thongrattana, P. T., 2012. An Analysis of the Uncertainty factors affecting the sustainable supply of rice production in Thailand. University of Wollongong, pp. 1-297. University of Nebraska-Omaha, 2011. Conceptual Framework. Knowledge. [Online] Available at: http://coe.unomaha.edu/facstaff/cframework.pdf [Accessed May 15, 2013]. ZDirect, 2012. 5-Star Luxury Thailand Hotel Company SALA Resorts & Spas Communicating with Guests Effectively via ZDirect. Home. [Online] Available at: http://www.zdirect.com/pressroom/20130403_SALA.html [Accessed May 15, 2013]. Read More