Are Your Satisfied Customers Loyal?

Abstract

The firmly held doctrine that guest satisfaction means repeat business is called into question by the results of this study of 364 guests of two similar big-city hotels. Analysis showed only a weak connection between satisfaction and loyalty (which is a precursor to repeat purchases). Examining such factors as purpose of travel and demographics, the study revealed another finding that may give hoteliers pause—especially considering the industry’s huge expenditures on frequent-guest programs. Business travelers were among the least loyal of the guests responding to this survey. The chief factors that engaged guests’ loyalty were hotel design and amenities. Moreover, the factor that caused guests to be most involved in the purchase decision (and therefore more interested in the hotel) was its employees. The implication is that hoteliers might consider redirecting some of their frequent-guest expenditures toward strengthening human resources and toward improving the guests’ experience through design and amenities.