Rahman, Maria Abdul (2014) The influence of relationship quality on customer loyalty: Evidence from the practices of outsourcing in the Malaysian hotel industry / Maria Abdul Rahman. PhD thesis, University Malaya.
Abstract
Tourist arrivals in Malaysia from January to December 2012, according to the Research Division of Tourism Malaysia, amounted to 25.03 million people, compared to 24.71 million people for the same period in 2011, an increase of 1.3 percent. The tourism industry generated receipts for Malaysia in 2012 totaling RM60.6 billion. Based on hotel statistics, hotel guests in Malaysia from January to December 2012 amounted to 56.07 million guests, compared to 53.76 million guests in 2011, an increase of 4.31 percent. This increase in the number of hotel guests indicated that hotels in Malaysia needed to provide more services to their guests. Since hotels are exposed to high fixed costs, they need to outsource some specific services in order to reduce their internal costs. The increase in the number of hotel guests has lead to a larger demand for outsourcing of services, and hotel managers have now been exposed to a wider choice of service providers that are willing to provide the specific services they require. This situation has made it easier for hotels to switch from one service provider to another. Therefore, service providers should try to increase the loyalty of existing customers (hotel managers) because it costs less to maintain an existing customer than attracting new customers. While the key objective of relationship marketing is to maintain customer loyalty there is, however, little agreement as to which antecedents should be used to achieve this objective. In addition, the lack of application of the Theory of Reasoned Action in the business-to-business relationships is worth investigating. In response, this study proposed a model of relationship marketing that empirically investigates, in one single model, the effect of perceived value, relational norms, and switching costs on relationship quality and customer loyalty; the effect of relationship quality on customer loyalty; and the effect of dependence on the relationship between iii relationship quality and customer loyalty. In particular, this thesis intends to investigate the role of relationship quality as the mediator between customer perceived value, relational norms, switching costs, and customer loyalty, and the moderating role of dependence on the relationship between relationship quality and customer loyalty. This thesis presents empirical findings from a survey of 158 Malaysian hotel managers, in which the data was analyzed using Partial Least Squares. The findings of this thesis revealed that, except for switching costs, customer perceived value and relational norms are important in affecting relationship quality. However, all these three variables (customer perceived value, relational norms, and switching costs) do not have any significant influence on customer loyalty. The results also show that relationship quality positively and significantly affects customer loyalty, which shows that relationship quality is a necessary determinant of customer loyalty. The results of this thesis also provide evidence that relationship quality mediates the relationship between customer perceived value, relational norms, and customer loyalty. However, the findings revealed that dependence does not moderate the relationship between relationship quality and customer loyalty. Since the results of this thesis showed that customer loyalty is indirectly influenced by customer perceived value, relational norms, and relationship quality, this therefore implies that there is a need for the key players in the hotel industry (e.g., Ministry of Tourism Malaysia, service providers, Malaysian Association of Hotels, and hotel managers,) to focus on these constructs in the pursuit of a more competitive advantage and long-term profits.
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