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The Satisfaction Index in the Hotel Business Case Study: Vega Hotel by Galati

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This study focuses on customers' level of satisfaction in the hotel industry. In this case, the level of satisfaction represents an index that links customers' satisfaction with the firm's effort to offer not only effective accommodation services, but other services as well. Under these circumstances, the hotel companies emphasize customers' satisfaction, realizing that customers' perception on the quality of products and services is a decisive factor in the size of the market segment and the level of profit.
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Electronic copy available at: http://ssrn.com/abstract=2765792
1
The satisfaction index in the hotel business
Case study: Vega Hotel by Galati
Dan Păuna
1
, Luminita Maria Filip
2
Abstract: This study focuses on customers' level of satisfaction in the hotel industry. In this case, the level of
satisfaction represents an index that links customers' satisfaction with the firm's effort to offer not only effective
accommodation services, but other services as well. Under these circumstances, the hotel companies emphasize customers'
satisfaction, realizing that customers' perception on the quality of products and services is a decisive factor in the size of the
market segment and the level of profit.
Keywords: customers' satisfaction, Servqual model, customers' satisfaction index.
JEL Classification: D11, D12, L83, P36.
1. Introduction
Generally, speaking about the hospitality industry, we consider a certain standard with implications on
the quality of the services offered, and the clients of the hotel “hope that the hotel will be clean,
comfortable, safe and secure. They expect it to be furnished with hygienic conditions, good and
sanitary food and beverage at a reasonable price˝ ( Emel Gonenc Guler, Cemal Yukselen, 2010).
Services provided by hotels nowadays are designed for efficiency which, combined with the design
elements, change clients’ perception. This new element, a fusion between the two dimensions, offers
more than the quality provided by standards and goes up to a significant commitment of the
employees, so the offered product, mixing luxury with experience, is exceptional, “a kind of unique art
work”. (Michelli, J., 2008.)
Hotel clients are divided into two categories: those doing business and vacationers. While business
clients are “very sensitive to the efficacy of the reservation systems and to the comfort offered by the
available equipment” (Lupu Nicolae 2010), vacationers generally prefer “options simpler and cheaper
than a hotel” (Lupu Nicolae 2010). Selecting a hotel means information, marketing actions, and, why
not, choosing the same accommodation place again due to previous complete satisfaction. “Basically,
there is no perfect hotel” (Lupu Nicolae op. cit.), but there are some advantages, sometimes even
considerable ones, that the hotel will use in order to appeal to a certain segment of customers.
However, there will be no hotels appealing to all categories of clients.
Consumers would like to choose a hotel from a set of alternatives, which would provide the maximum
expected value based on a set of attributes. To help achieve the above objective, the consumer can
independently search for information or use a travel agent.( Minakshi Trivedi, Michael S. Morgan and
Kalpesh Kaushik Desai 2008).
Implicitly, the hotel does not sell the basic product, accommodation, but much more than this, it will
sell a commercial name, with emphasis on an identity, a success factor which will answer the question
”How can we offer what people wish for?" (Diller, S., N. Shedroff, D. Rhea., 2006.)
The starting point for any manager of a hotel whose strategy is oriented towards the client, is
represented by the client’s needs and expectations.
1
Lecturer, PhD, Danubius University of Galati, Faculty of Economic Sciences, Romania, Address: 3 Galati Blvd, Galati,
Romania, tel: +40372 361 102, fax: +40372 361 290, Corresponding author: paunadan@univ-danubius.ro
/pauna_dan@yahoo.com
2
Lecturer, PhD, Danubius University of Galati, Faculty of Economic Sciences, Romania, Address: 3 Galati Blvd, Galati,
Romania, tel: +40372 361 102, fax: +40372 361 290, Corresponding author
Electronic copy available at: http://ssrn.com/abstract=2765792
2
Hotel companies which offer efficiency will automatically attract a great level of satisfaction
generated by high quality and will certainly obtain some advantages compared to their rival
companies.
Therefore it is very important to know the real quality level of the supplied services in order to
compare it with the target value (using a quality measurement system will make possible the
coordination and orientation of the developed processes to fulfill customer requirements) (Mândru,
2011).
Customer perception is the hotel manager’s highest priority. In this respect, customers’ perception on
hotel services provided constitutes a present feed-back on customers’ requirements and, in long term,
on maintaining, lowering or increasing the individual level of the standards of services offered.
2. Theoretical Concept
Customers’ needs and requirements represent satisfaction at an adequate level of both their material
and spiritual needs. Services for clients hold an essential role in this respect, since they satisfy their
needs (requirements) as well as those ensuring comfort or leisure time. Therefore, services provided to
clients are meant to satisfy their multiple needs.
Generally, the concept of client satisfaction induces psychological moods such as welfare, happiness
and content.
An important trend in recent years has been the development of customer relationship management
(CRM) systems directed towards improving customer retention and building customer loyalty (Mark
S. Johnson, Eugene Sivadas and Ellen Garbarino 2008).
Customer relationship management (CRM) systems are based on a series of stages, but the most
important is the one post-purchase.
The result of post-purchase assessment is a critical fact resulting in positive or negative attitudes
which will lead to feelings of satisfaction or dissatisfaction. It is essential for the multitude of internal
or external factors which ensure the success of the business to make the customer purchase the brand
again
.
Figure 1. Satisfaction and connection from CRM perspective
There are two aspects that clients will measure irrespective of the notoriety of the brand they buy, that
is:
1. an assessment process oriented towards cognitive dissonance in the case of services;
2. an assessment process on the difference between the previous beliefs and revised present
convictions in the case of goods.
3
Leon Festinger’s concept which envisages the psychological distemper due to the split between two or
more conflicting ideas is found in the consumption behavior. There will be a difference, positive or
negative between what we wish and what we find in reality, no matter if we talk about goods, services,
activities or ideas.
˵Some service marketing studies have indicated a weak effect between customer satisfaction and
affective commitment for consumers̋ (Bansal et al., 2004; Bettencourt, 1997).
Competitiveness and long term profitability will be at a maximum level as long as it is done what is
best for the consumer. In the hotel industry a hierarchy client satisfaction-client loyalty-business
success would not surprise anybody as long as there is a correlation between client satisfaction and
loyalty.
˵Some people have suggested in recent times that customer satisfaction is ˵old hat ̋ and that we should
be concentrating on costumer loyalty and ˵ delighting the customer ̋ ̋ (Nigel Hill, John Brierley and
Rob MacDougall; 1999, pp. 3).
An overall index of costumer satisfaction, often called satisfaction index, or costumer satisfaction
index, is the overall average of all satisfaction scores. It isn’t ideal because some things are more
important than others to costumers, the category of social and cognitive psychology. The theory of
attitudes and their attributions measurement ˵refers to the measurement of mental response and mental
representations̋ (Fauconnier & Turner, 2006), but they show the most important attributes in the
process of choosing the level of satisfaction. This index shows the extent to which the current level of
quality corresponds to the needs of consumers. “The subject of CSI (costumer satisfaction index)
measurement captures, not the opinion of the respondent,”( Natalia Yanova 2015), but its attitudes are
the most important in the survey.
3. The case study: The satisfaction index at Vega Hotel by Galati
The study was conducted on the basis of a questionnaire consisting of 44 questions in the case of the
model Serqual. Among these questions that define the different levels of the main attributes were
found some having a double meaning:
1. they emphasize the level of satisfaction according to servqual model;
2. they measure the satisfaction score used in calculating the satisfaction index;
There is a separate question for the importance the tourists place on the attributes that make up the
satisfaction index calculation.
The sample of 241 tourists that have accepted to answer the question in the survey is not
representative, taking into account that in 2013, 6747 tourists checked in in the hotel.
3.1. Hotel - general presentation
Hotel Vega is one of the most appreciated hotels in Galati. Set in a picturesque location on the bank of
Danube, downtown Galati, Hotel Vega is built in a modern style and it offers high quality
accommodation conditions in a quiet and elegant frame. It is a three-star hotel and it has a four-star
restaurant. The hotel belongs to Lyra Tour S.A trading company.
3.2. Research methodology
Assessment of tourist service quality has been implemented according to the Servqual model
requirements, that is by five important features such as seriousness, readiness, tangibility, empathy and
reliability. The model is implemented on an answer scale, meant to encompass both the clients’
expectations and perceptions regarding the services provided.
This model means asking clients 22 questions regarding their perception, as well as 22 questions on
their expectations relative to the level of quality and satisfaction. Respondents are required to assess
the statements using a Likert scale with seven items. The statements represent the extent of service
quality based on five groups of factors which determine clients’ satisfaction.
4
The factors have the following meaning:
Seriousness – represents the offer of a fair, professional service, which provides confidence;
Elements that concur to seriousness are trust, fame, and image.
Tangibility the physical elements that make up the service provided and the facilities offered to
the customers;
Elements that concur to tangibility are material goods.
Readiness – represents the wish to help customers and to offer the services when necessary;
Elements that concur to readiness are staff’s availability and training when providing services.
Reliability – represents the staff’s professionalism and kindness, physical safety and their ability to
inculcate trust;
Elements that concur to reliability are: physical safety, financial safety and privacy.
Empathy – represents the distinction of the services offered according to clients’ requests.
Questions from 1 to 4 (4 included) define tangibility, 5-9 define seriousness, 10-13 define readiness,
14-17 define reliability and 18-22 define empathy.
Figure 3. Main attributes considered by Servqual model
Figure 2. Main attributes considered by Servqual model
Source : processed by author
Since the importance of expectations is vital, these are influenced by a series of other essential factors,
described as follows:
Personal needs: any client benefiting by a service will firstly turn to their personal needs which are
expected to be fulfilled by the service provided. Since these needs are different according to each
client and service, it is mandatory to clearly understand them in order to create an appropriate service;
Previous experience: it is an important factor since most customers used services in the past.
Therefore, previous experience influences at a certain extent future expectations regarding the service,
including previous experience not only with that service, but also with other types of services. When it
comes to accommodation services, expectations are influenced by the experience with similar services,
but provided by another hotel;
Tangibility
Questions 1 - 4
Empathy
Questions
18
-
Seriousness
Questions
5
-
9
Readiness
Questions 10 - 13
Reliability
Questions 14 - 17
EXPECTATIONS
AND
PERCEPŢIONS
5
Oral communication: in this case, expectations are shaped according to informal talks with friends,
family members and workmates, but they can also be shaped by the media or other organizations such
as the audit agencies;
Explicit communication regarding services: made up of staff statements but also advertising
through brochures or other advertising materials. This type of communication has a direct and well-
defined impact on hotel clients’ expectations;
Implicit communication regarding services: it alludes to certain factors, such as the hotel’s
appearance. An example in the accommodation services can be the refurbishing which can make the
beneficiary or the client expect other aspects of the services offered in the same hotel to be of high-
quality.
These previously stated factors hold an essential role in the client’s thinking process which is different
for each individual. Therefore, calculating the general level of satisfaction means calculating the
satisfaction index. The attributes it relates to occupy different levels when establishing the hierarchy
and some are more important than others.
Virtually, calculating the satisfaction index firstly means to find out the level of importance for each
attribute considered, then each score obtained for each attribute to be multiplied with the level of
importance.
In the first stage of the study through the Servqual model we can find out the satisfaction levels for the
5 attributes. The difference between perceptions and expectations indicates the satisfaction level. (see
the results in table 1).
The results in Table 1 can be classified into two categories, as follows:
"high" if the level of the expected/received service is above the average;
"low", if the level of importance is below this average.
Respectively, these also allow not only a classification of the service, but also a hierarchy of the
satisfaction level between expected and received service.
Table 1. Classifying and grading services
Atributte
Level of
expected
service
NSa
Level of
received
service
NSp
Difference
(NSp – NSa)
Interpreting the degree of
importance
IP>IPmed.
IP<Ipmed
Interpreting Servqual
S
e
S1
3,67
4,33
-
The level of expected
service seriousness
corresponds with the
average. The received
service is above average.
Expectations
correspond with the
level of received
service.
S2
3,18
5,81
-
S3
3,46
5,53
-
S4
2,88
5,11
-
S5
2,86
6,1
3
-
3,21 5,38 2,17
T
T1
2,9
6
5,0
4
-
The level of service
tangibility is above
average, and expectations
are above average.
Staff training and
endowment is at the
level expected by the
client.
T2
4,5
5
5
,45
-
T3
2
,
6
7
4,63
-
T4
4
,90
5
,
1
-
3,77 5,05 1,28
P
P1
2,55
3,44
-
The level of service
readiness is a little above
the average.
Readiness level must
be raised, but it can
also be maintained.
P2
4,9
5
5
,0
5
-
P3
2,88
2,04
-
P4
3,9
3
6,0
7
-
3,57 4,15 0,58
Si
S1
2,8
1
1,82
-
Reliability is considerably
below average and below
the level of expected
service.
In this case, it is
necessary to maintain
the reliability
standard.
S2
2
,2
8
1,72
-
S3
2
,96
3,03
-
S4
2,19
2,80
-
eS
T
P
6
2,56 2,34 - 0,22
E
E1
6
,92
6,07
-
The level of attention
granted to clients for both
services is above average,
and the level of the
difference is,
paradoxically, negative –
considerably below
average.
The level of attention
granted to clients
needs to be raised in
order to make the
difference positive.
E2
4
,86
5,13
-
E3
3
,91
3
,82
-
E4
5
,38
4
,62
-
E5
2,5
5
2
,5
0
-
4,72 4,42 - 0,30
Average
Generally, the average of the difference is positive,
even when it has been determined that the level of
empathy offered to clients is only a standard, not
real.
A negative difference can also be observed, just as
in the case of reliability level with the two
indicators, S1, S2, reliability suggested by staff
behavior and implementing environmentally-
friendly policies. Therefore, correlating reliability
with empathy, we can draw the conclusion that
staff behavior towards clients is not in accordance
with the hotel policy.
3,56
4,26
+ 0,70
Source: processed by author
For the second part of the study, which will rate the level of the satisfaction index, we have considered
the following attributes:
1. location – according to N. Lupu “the degree of occupancy of the future hotel, as well as the type of
clients, will mostly depend on its location”(Lupu N.2010, pp.397) or according to Conrad Hilton
3
“location, location, location”;
2. room layout – price of the hotel room also depends on the floor, view, area, or furniture;
3. level of price – accommodation price is renting the hotel room for one day;
4. service quality we will consider the difference between received and expected service from the
Servqual analysis;
5. check-in/out aims at a flexible schedule, offering help with the luggage, monitoring the waiting
time for the customers;
6. front - office helpfulness – although the front office is sometimes seen as being the forefront of the
hotel activity, it controls more than the activities taking place there. Irrespective of its size, the front
desk must be organized in order to manage key tasks and responsibility fields;
7. parking – there is a great disadvantage for the hotels having no parking or insufficient parking space
for the number of clients;
8. staff appearance/ behavior “the relationship with the client gives substance to the “emotional
quality””(Lupu N 2010, pp. 147) which can not be neglected. In fact, the first impression does matter.
The importance scores are used to calculate the weighing factors. In table 2 the first column of data
shows the average importance score from the hotel survey. The Likert scale was standardized on the
7th step, while the 4th step means neither satisfied nor dissatisfied.
At first we will calculate the levels of importance tourists place on each of the above-mentioned
attributes, thus obtaining the data in Table 2.
3
Conrad Nicholson Hilton (December 25, 1887 – January 3, 1979) was an American hotelier and the founder of
the Hilton Hotels chain.
Si
E
Nsa
Nsp
Md
7
Table 2. Calculating the weighing factors
Attribute Importance scores Weighting factors
Location 6,4 15,49
Room layout 6,2 15,01
Level of price 6,1 14,76
Service quality 0,70 1,69
Check-in/out 5,5 13,31
Front - office helpfulness 5,8 14,04
Parking 4 9,68
Staff appearance/ behavior 6,6 15,98
TOTAL 41,3 100%
During the second stage, we take into account the satisfaction levels tourists place on the
attributes considered. In this respect, see Table 3.
Table 3. Calculating the satisfaction index
Attribute Satisfaction scores Weighting Factors Weighted Scores
Locationl 6,2 15,49 9,603
Room layout 4,9 15,01 7,354
Level of price 5,8 14,76 8,560
Service quality 0,70 1,69 1,183
Check-in/out 4,4 13,31 5,856
Front - office helpfulness 5,2 14,04 7,300
Parking 4,6 9,68 4,452
Staff appearance/ behaior 5,4 15,98 8,629
TOTAL 37,3 100% 53,177
.
In this case we obtain a satisfaction level index of 53,177% .
The obtained level of satisfaction is above average for the hotel business as it is wished that clients’
opinions and attitudes match expectations, which leads towards competitiveness and long term
profitability. We can conclude that the obtained level of satisfaction is in correlation with the
considered attributes, while the Scatter chart, which offers information on Correlation, Homogeneity
and presented and analyzed data symmetry, shows a direct correlation.
0
5
10
15
20
0123456789
Importance scores
Satisfaction scores
Weighting Factors
Chart 1. Level of satisfaction is in correlation with the considered attributes,
For a positive satisfaction level identified by the 5 dimensions of the Sevqual model, we can notice
that the differences between clients’ perceptions and expectations do not all have negative values. This
8
result indicates that for the hotel some attributes such as reliability and empathy are not in conformity
with clients’ requirements. Clients view the reliability level as being too low while being prone to
risks, and not all services are offered for individuals, for each client, but for collectivity. The study
needs to be repeated at regular periods of time in order to see the desired level of quality.
4. Conclusions
The results of the study can be found only in three dimensions of the Sevqual study, that is tangibility,
seriousness and readiness. For empathy and reliability the management must adopt other strategies to
meet the clients’ needs.
The basis is the assessment of the service from a previous experience, even if many aspects have been
changed. Perceptions are already formed and a change for the better is going to be difficult to achieve.
The study efficacy is focused on the level of satisfaction index, which, by the measured level, shows
that it is generally correlated with clients’ expectations.
The main issue is that theoretically, the practice of following some standards does not offer the desired
level since there is no implication from the members of the organization. On the other hand, the level
of quality for the services provided, as well as the level of satisfaction represent a sum of each
satisfied or dissatisfied client.
4. Bibliography
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service providers, Journal of the Academy of Marketing Science, Vol. 32, Summer, pp. 234-250:
Diller, S., N. Shedroff and D. Rhea. (2006), Making Meaning- How Successful Businesses Deliver
Meaningful Cusaomer Experiences. Berkeley, CA: New Riders;
Emel Gonenc Guler, Cemal Yukselen(2010), Hotel employees’ beliefs on unethical behavior, Social
Responsibiliay Journal, Vol. 6 No. 2, pp. 252-267, Q Emerald Group Publishing Limiaed, ISSN 1747-
1117;
Fauconnier G., Aurner M. (2006), Mental spaces: conceptual integration networks. In Dirk Geeraeras
(Ed.)Cognitive linguistics: basic readings, pp.303-371, Berlin, Walaer de Gruyaer GmbH &Co. KG.
Lupu Nicolae (2010), Hotelul – Economie şi Managemena, CH. Beck Publishing House, Bucureşti;
Mândru, Lidia (2011), Quality-Risk Integrated Management for Industrial Companies, Transilvania
University Publishing House, Brașov, ISBN 978-973-598-944-6, pp.35.
Michelli, J. (2008), the New Gold Standard, Five Leadership Principles for Creating a Legendary
Customer Experience. New York: McGraw Hill;
Minakshi Arivedi, Michael S. Morgan and Kalpesh Kaushik Desai (2008), Informational role of agent
in service industry, Journal of Services Marketing, Volume 22, Number 2, pp:149 –159;
Mark S. Johnson, Eugene Sivadas and Ellen Garbarino, (2008), Customer satisfaction, perceived risk
and affective commitment, Journal of Services Marketing, Volume 22, Number 5, pp. 353–362;
Nigel Hill, John Brierley and Rob MacDougall (1999), How to Measure Customer Satisfaction,
Gower publishing limited;
Stănciulescu, Gabriela. (2003) Managementul operaţiunilor de turism Bucureşti, All Beck
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Saandfield, K. (2005). Inatngible Finance Standards. San Diego, CA: Elsevier, Academic Press.
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Yanova Nataalia, (2015), Assessment of Satisfaction with the Quality of Education: Customer
Satisfaction Index, Procedia - Social and Behavioral Sciences 182, PP. 566-573 · May 2015, Pp.567
W. J. Deng · M. L. Yeh · M. L. Sung (2013), A customer satisfaction index model for international
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*** Revista Amfiteatru Economic;
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Purpose This paper aims to examine competing models of the directionality of influences between customer satisfaction, affective commitment, and the customer's perceptions of risk associated with a service organization. It also aims to include the effects of a customer's prior experience with the organization and experience with other organizations in the service category in the models. Design/methodology/approach Structural equation models of data from a survey to customers of a performing arts organization (sample size=401) are used to test the hypotheses. Findings The study suggests that commitment has a positive influence on customer satisfaction and diminishes risk perceptions. There is less support for a model in which satisfaction increases commitment and reduces perceived risk. Originality/value There has been recent controversy as to whether customer satisfaction leads to customer loyalty. This study provides a different perspective by suggesting that customers with high commitment to an organization use satisfaction surveys to express their loyalty.
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“We're now hip-deep, if not drowning, in the 'experience economy.' Here's the smartest book I've read so far that can actually help get your brand to higher ground, fast. And it's written by people who not only drew the map, but blazed these trails in the first place.”ヨBrian Collins, Executive Creative Director, Ogilvy & Mather Worldwide Brand Integration Group In a market economy characterized by commoditized products and global competition, how do companies gain deep and lasting loyalty from their customers? The key, this book argues, is in providing meaningful customer experiences. Writing in the tradition of Louis Cheskin, one of the founding fathers of market research, the authors of Making Meaning observe, define, and describe the meaningful customer experience. By consciously evoking certain deeply valued meanings through their products, services, and multidimensional customer experiences, they argue, companies can create more value and achieve lasting strategic advantages over their competitors. A few businesses are already discovering this approach, but until now no one has articulated it in such a persuasive and practical way. Making Meaning not only encourages businesses to adopt an innovation process that's centered on meaning, it also tells you how. The book outlines a plan of action and describes the attributes of a meaning-centric innovation team. With insightful real-world examples drawn from the Cheskin company's experience and from the authors' observations of the contemporary global market, this book outlines a plan of action and describes the attributes of a meaning-centric innovation team. Meaningful experiences-as distinct from trivial ones-reinforce or transform the customer's sense of purpose and significance. The authors' vision of a world of meaningful consumption is idealistic, but don't be fooled: this is a straightforward business book with an eye on the ROI. It shows how to bring R&D, design, and marketing together to createï¾ deeper and richer experiences for your customers.ï¾ Making Meaning: How Successful Businesses Deliver Meaningful Customer Experiences is an engaging and practical book for business leaders, explaining how their companies can create more meaningful products and services to better achieve their goals.
Intangible Finance Standards
  • K Saandfield
Saandfield, K. (2005). Intangible Finance Standards. San Diego: CA: Elsevier, Academic Press.