The hotel industry todayis also known as a global industry, with producers and consumers spreadingaround the world. Increasing customersatisfaction is one of the main key aspects of increasing competitiveness inthe industry and in the same time allowing the business to continue operatesmoothly.In a service perspective,overall satisfaction is similar to overall estimations of service quality,customers expectation, value for money and hotel image.
Understanding the consumer’s wants and needsis important in order to be successful in the hospitality industry (Goeldner etal.,2000). Customer satisfaction is defined as a customer’s overall appraisalof the performance of an offering to date (Johnson and Fornell ,1991).Satisfaction is understood to be predicted by service quality (Sudin ,2011) andconclude that the hotel sector should focus especially on providing qualityservice with respect of the factor of perceived quality that are the most importantto customer (Nasution and Mavondo, 2005). Beside it, customer expectationshould be concern since, customer expectation may influence the delivering ofthe best services provided (Parasuraman et al.
,1991).Service quality lead tohigher cost-effectiveness (Gundersen et al., 1996) and customer satisfaction(Oliver, 1997).
Value for money iscompared between the benefit and customer satisfaction of perceived value.Customers satisfaction is important for value for money and might be influence byit. Hotel image has been argued that is a value added to identify the customerssatisfaction (Gro¨nroos, 2000) which include the hotel location, exterior andinterior design, reputation and atmosphere of a hotel (Bill et al., 2007;Knutson, 1988).There are challenges thatwould be faced by a hotel which are the constantly growing volume and also thepace of competition. Competition has had major implications for the customer,such as increased choice of products and services, greater value for money forthe products and services produced as well as higher levels of services. Lamand Zhang (1999) claimed that devastating customer demand for quality productsand services has in recent years become increasingly patent to professionals inthe tourism and hotel industry.
Researches and marketers have begun to questionthe actual return on the hotel’s investment specifically more on quality, services,hotel image enhancements with the purpose of satisfying customers and meetcustomer expectation. (Zaithaml, Berry and Parasuraman, 1996). Research Objective:1. Toinvestigate how service quality can affect customer satisfaction among thebudget hotel.2.
Todetermine the relationship between customer expectation and customersatisfaction.3. Toinvestigate the relationship between value for money and customer satisfaction.4. Tounderstanding the relationship between hotel image and customer satisfaction. ResearchQuestion:1. Howdoes service quality of a budget hotel affect customer satisfaction?2.
Whatare the customer expectation that can affect customer satisfaction?3. Doesvalue of money really affect customer satisfaction?4. Howa budget hotel image influences the customer satisfaction?Problem Statement:Studies show that guestssatisfaction may have indirect or direct impact to the hotel industriesbusiness. Thus, enhancing customer satisfaction is an important part for thehospitality industry to value their guests proposition (Siguaw a. Enz, 1999). Therefore,millions of dollars per year were spend by the hoteliers to better impose guest’ssatisfaction and also find out the factors that will affect their satisfaction.To increases guest’s satisfaction, an understanding of what is the factors thatwill causes guests to stay and to return, is very important for the hoteliers.We found that the top four factors that will affect guest’s satisfaction willbe “service quality, customer expectation, value for money and hotel image”.
The purpose of conductthis study, is to understand the factor that will affecting guest’ssatisfaction among local tourisms in budget hotel at Kuala Lumpur (KL) area. Thisresearch conducts a number of questions, which examine the relationship betweenguest satisfaction and service quality, customer expectation, value for moneyand hotel image in the hotel industries.2. Literature Review2.1 Customer Satisfaction Nowadays, customer satisfaction has been a hot topicin marketing practice and business research since Cardozo’s (1965) started studyof customer’s satisfaction and expectation. Even there is a lot of measures andexplanation for customer satisfaction, thus still does not have a generalagreement regarding its definition (Giese and Cote, 2000). Customersatisfaction is generally defined as a summary evaluation of a customer’soverall experience in an organization with concerning a specific product(Gundersen, Heide and Olsson, 1996) or the services received (Cronin andTaylor, 1992). Inshort, customer satisfaction can be defined as fulfilling the customer response(Yuksel, Philip, & Graham, 2008).
Customer satisfaction is the result of anappraising process that compare between repurchase expectations withperceptions value and after the experience (Oliver, 1980).Expectancy disconfirmation theory is the most acceptedconceptualization of the concept for customer’s satisfaction (Barsky, 1992; Ohand Parks, 1997; McQuitty, Finn and Wiley, 2000). Oliver (1980) proposed andcreated that customer’s satisfaction level is a result of the differencebetween expected and perceived value. When the product or services are betterthan expected, a satisfaction which called positive disconfirmation occurs. Onthe other hand, negative disconfirmation of dissatisfaction occurs when theperformance worse than expected results. 2.2 Service Quality Service quality play a fundamental role for a businessto success.
It is very important for hotels management to understand andconduct a proper consideration on what is the needs and wants of their guests. Servicequality measure how well a service is delivered, compared to customerexpectations (Parasuraman et al., 1988; Gronroos, 1982). It is a tangled,tricky, emotional and abstract concept.
For different people, it means differentthings since their expectations are different. Quality is a three-dimensional concept (Lehtinen andLehtinen, 1982) which name as corporate quality, interactive quality andphysical quality. Quality can also be defined as the integrality of the characteristicsof a product or services that carry on its ability to delight stated or involveneeds (Kotler et al., 2002). Likewise, Gronroos (1984) stated that servicequality represents of technical quality, functional quality and corporateimage. 2.3 Customerexpectation (waimin ???????)Customer expectations aredefined as the desires or wants of consumers, i.
e.,what they feel a serviceprovider should offer rather than would offer (Parasuraman et al., 1988).
According to Parasuraman, Berry, and Zeithaml (1991), service providers mustrecognize customer needs in order to fulfill expectations to achieve high customersatisfaction during the service experience. Managing customer expectation is animportant subject to enable customer satisfaction (Hsieh et al., 2011; Kurtz& Clow, 1992–93; Pitt & Jeantrout, 1994; Clow & Beisel, 1995; Coye,2004). Expectations serve as a major determinant of a consumer’s servicequality evaluations and satisfaction (Grönroos, 1994; Parasuraman et al., 1985;Parasuraman et al., 1988; O’Connor et al., 2000; Van Pham & Simpson, 2006).
At this point, the ”voice of the customer” should be taken into the designprocess and after delivering the services, service providers should monitor howwell the customers’ expectations have been met (Pakdil & Ayd?n, 2007). 2.4 Value for Money Value for money can be defined the utility you get from each purchase orexpense. In the customer satisfaction, value for money not only depends on thepurchase price, but also on the efficiency and effectiveness on the service orpurchase for product.
Many investigators have approved the mean of satisfactioncan explaining from the value (Bloemer& Dekker, 2007). People can understand how much for value in productsor services through the response and satisfaction from customers. Value for money also can define to spend the money in something that isworth for them who is willingly to pay because its functions or effectiveness.A mediator between services and profits is one function to value and value canoperate as a result of services (Sinclairet al, 2002).
When satisfaction is reached, customers will seek the value of theservice or product, if this is hypothesis view, then suppose the perception ofa product, system, or market behavior is based on a simple test of the consumervalues to the extent that they reach” (Westbrook& Reilly, 1983, p. 258). People can understand the value throughquestionnaires, surveys or researches, so that they can predict what customer’swants in the hospitality industry.2.5Hotel image Hotel image is publicpreference of towards the hotel.
Zeithmal 7 points out when purchasing,customer behavior are based on their instinctive acknowledgement of value, thisis applied to hotel business which also means that the reputation of a hoteland satisfaction of its customers lead to the behavior of purchase. Hotel imageis the sum of individuals’ beliefs, ideas, and impressions towards a hotel(Baloglu and Brinberg, 1997). Despite the set in of impression in the definitionof image, such a concept appears to be short term-oriented compared to image,that is long term-oriented (Andreassen and Lindestad, 1998). A person’simpression of a hotel appears to be based on a reconnaissance of theenvironment while hotel image goes beyond ordinary investigation to include allaccumulated information, whether based on firsthand experiences orcommunication processes (Gartner, 1993).Sweat 12 thinks that measuringimplications of customers of customer’s purchase behavior includes: thereputation of purchased products, the purchased amount and more. Countryman andJang (2006) used impression in the hotel setting to predict guests’ attitudetoward a hotel. By combining those researches, this brings out threeimplications for the measurement of hotel image which is the reputation of thesatisfactions towards the hotel and loyalty of its customers.
2.6The relationship between service quality and customer satisfactionOn the other hand, Parasuraman et al. (1985; 1988) developed theSERVQUAL scale, which became the most popular instrument for measuring servicequality. They identified five key dimensions of service quality – reliability,tangibles, responsiveness, assurance and empathy. According to this instrument,service quality occures when perceived service meets or exceeds customer’sexpectations.Fromthe research, we summaries that value for money is psychological perspectivethat is contain human behavior and they think it worth it and as known astransaction value is price pay by customers (Gallarza and Saura, 2006; Rajaguru, 2016).
The value for money canbe interpreted as functional relative to price pay (Jayanti and Ghosh, 1996). The functional of value for money is asignificant that can measure the transaction between price and usefulness (Kashyap and Bojanic, 2000). Value formoney is a notion that has both price and quality in one relationship in thehospitality industry. Theconcept that has combine price and quality in one compages is called value formoney in tourism and hospitality industry (Narayanet al., 2009). The value isimportant in a tense economic environment; value for money within considerationas a dimension of customer satisfaction in tourist literature for few writers (Narayan et al., 2009).
In hospitality, customers also need paidfoods and drinks, not only pay the room fees during accommodation (Walker, 2009). Then, both service andproduct are include in one package will better in value for money when comparewith other packages that is include accommodation only (Turner & Troiano, 1987); and the best features and feel valuefor money is one package that contain meals during accommodation. This is oneway to prepare other products or services that are low value can providetogether to our customers. This way can increase our revenue and image of ourbusiness in the market.
Valuecan be delimited in relativistic, comparative, personal and situationalprocess. Zeithaml (1988) defines thatvalue is a price in physical needs that has quality for consumer who is willingto pay to get what they want. Value for money can be also known as currencyvaluation that is contrast advantage and sacrifice in transaction (Bolton and Drew, 1995).
The empiric andvalue is a mentality that can get from the satisfaction of customer. (Lee et al, 2007) Customers will be basedon their experience to evaluate the buying experience at value for money; thecustomer satisfaction and purchase behavior will affect from the evaluation (Rajaguru, 2016). In hospitalityindustry, customers will praise when they feel pleased and will also returnback to the particular hotel that they like. Therefore, we hypothesized that isvalue for money affects customer satisfaction in hospitality industry. Therelationship between hotel image and customer satisfactionThe concept of hotel image has been determined as one of the mostsignificant factors and determinants in developing a marketing strategy forhospitality business, whereas customer satisfaction is considered a majorsuccess factor in sustaining and expanding hotel customer base.
Satisfactionmeans providing goods and services that create specific levels of perceivedvalue for the customer so that the customer remained engaged completely withthe organization (Wicks and Roethlein, 2009). Customer satisfaction can bedefined as the point to which a service or a product meets the customer`sexpectations. Therefore, customer satisfaction in general pertains to theevaluation of a product or its features (Hunt, 1977). It specifies that thehotel guests are happy with the services and products offered. Guests may besatisfied with an experience, a service or a product, as well as with employee’s` performance. On the other hand, others have perceived satisfaction to be anoriginator for image and image together with satisfaction being factorsimpacting loyalty (Helgesen and Nesset, 2007; Kandampully and Hu, 2007).Furthermore, Brunner et al. (2008) noted that the impact of customersatisfaction and image on loyalty varies with the nature of thecustomer—experienced customers are loyal due to their image of a service whilenew customers’ loyalty is motivated by their level of satisfaction.
During a stay at a particular hotel,guests express their experiences in terms of their satisfaction from the wholehotel image dimension. This implies that guests` satisfaction is stronglyinfluenced by the physical environment of the hotel, the processes that followed, and their contactwith employees and the hotel`s products and services which includes quality,variety and pricing. Guests evaluate the entire hotel by taking the dimensionsof quality, variety, and pricing into consideration in order to determine thelevel of satisfaction. Guests` investment behavior toward a particular hotel isdetermined by the image of that particular hotel whether the products, servicesor employee’s performance meet their expectations. Some researchers havecited image as an originator to customer satisfaction (Andreassen andLindestad, 1998; Bloemer and Ruyter, 1998; Clemes et al., 2009; Lai et al.
,2009; Milfelner and Korda, 2011; Prayag, 2008), with satisfaction having asignificant positive impact on loyalty. The more positive the image, the higher the satisfaction the guestsreceives from the hotel. Therefore, we hypothesize that hotel image affectsguests` satisfaction.To complete this study, some modifiedquestionnaire will be done in order to collect the data. The purpose of this isto identify and analyze the relationship between customer satisfaction andservice quality, customer expectation, value for money and also hotel image.The modification will be make actually to suit the budget hotel situation andfor the study.3.
1 Research MethodBased on our report, we will beusing two types of research methods for our report. Using this type of researchmethods, it is because we need the data and information to prove our report andwe also will increased knowledge about our topic through research. Definition of research is job thatinclude learning something and refer some research that somebody is doingbefore to gain new knowledge or prove your research. Research methods has twotype which is primary research and secondary research.Definition of primary research is first-handinformation collect by that person who was doing the part of research.Researchers using many different methods to study the topic in order to gaininformation.
Advantage of using primary research is researcher can collectactual information from the sources. Primary data can gather through surveys,interviews and more. Secondary Research have using information collected byothers person through primary research. Advantages of secondary research is theinformation already have and done by others person, it will easily and quick toget the information.
Information of secondary research can find from library,and Internet. 3.2 Data Collection MethodBased on our datacollection methods, we decided to do conduct surveys. Surveys can be carriedout in many ways.
We planned to do questionnaires and also internet survey onour topic. A questionnaire is a research instrument that consist of a series ofquestions for gathering information from respondents. A major advantage ofquestionnaires is that a large number of people can be reached out easily andeconomically. However, a standard questionnaire provides quantifiable answersfor a research topic and the answers are somehow relatively easy to analyze aswell. On the other hand, an internet survey is being conducted over theinternet and they have a number of advantages over other methods of interview.
Internet surveys now can also be done with mobile phones without any hassle.They are convenient as they allow respondents to take on their own time andtheir own pace to answer the given questions provided. Our topic is Factorsthat are affecting customer satisfaction among local tourism in budget hotelsin Kuala Lumpur. In this case, we are going to provide questionnaires to ourrespondents with a series of questions relating our topic and gather relevantinformation from our respondents. The second way of collecting data is internetsurvey as mentioned, and we are going to provide a series of questions on theinternet allowing our respondents to answer them accordingly and with no rushjust with their own pace.
From that, we are able to collect data from ourrespondents on our topic.3.3 Sampling PlanTo conduct our studies, we target localtourisms which mean Malaysian who stayed in budget hotel at KL before to answerour survey form. In addition, we also separate them into two group by age. GroupA will be people under age 21 to 30 years old, and age between 31 to 40 will beunder group B. The reason why we separate into two group is to identify andunderstand the factors that affecting customer satisfaction in different ages.
The factors maybe the same or different in different age. Moreover, we targetthose people under age 21 to 40 is because of their financial ability and preferences.3.4 Fieldwork PlanAfter submit this research report, we willstart to plan and design our questionnaire by using app that suggested by thelecturer. A pilot test will be done to ensure the respondents understand and feelcomfortable to the questions asking. After that, a field test will be conductto collect the data through social media and face to face. A survey form willbe upload to the social media such as Facebook or Google drive to allow people whois busy and shy to fill up. This method also allows us to collect more data betweenpeople between age 31 to 40 because they usually busy in work.
Beside usingsocial media, our teammates will also provide the survey form to the TARUC studentsat the canteen 1,2 and 3. In the other hand, we will also provide the surveyform in the lecture class with the help of the lecturer. Since we target notonly college or university students, collect the data in the public area willalso be done to ensure the accuracy of our study. 3.5 Analysis PlanIn our research, we will analysis the planthat can make us know what most in factor that affecting customer’ssatisfaction among local tourism in KL. The type of analysis for us to use thatis multivariate analysis. We will prepare the survey that is a series ofquestions for gathering information from respondents.
The questionnaire will beseparate into two parts, which is part A and B. The questions include in part Awill be the basic information of respondents such as name, gender, ages, raceand income in our survey form. In part B, open-ended questions such as whattype of hotel you prefer or when was your last trip to KL will be include. Wealso can design questionnaires like what is you comment about the budget hotelin KL. Then, we will provide measurement scale that is raking such as Likert’sscale for them to mark.
For example, 1 is strongly disagree, 2 is disagree, 3is neither agree nor disagree, 4 is agree and 5 is strongly agree. A differenttabulation will be use to analysis the data collected. Beside it, we alsoprepare a bar chart that is representing the data we collect to analysis thedata collected. For example, the length of rectangle is representing thesatisfaction; there are 4 categories such as quality of service, hotel image,value for money and customer expectation.
If the length of one bar in bar chartis longer than other bars mean this bar is most in factor that affectingcustomer’s satisfaction.