Factors influencing loyalty in hotels' fine dining restaurants moderated by switching cost

Abstract

v ABSTRACT Many studies have been conducted on developing loyalty model in hospitality and restaurant industry, but the inhibiting factors of restaurant customer switching have yet to be identified. To maintain loyalty the literature has proven that customer satisfaction is connected positively to loyalty in hospitality industry. Hence, the main objective of this thesis is to maintain and to improve loyalty through developing a basic model of service quality-satisfaction-loyalty by taking two steps. First, the service quality model was integrated with the independent variables which were the relationship marketing and the corporate social responsibility. Second, this study examined the moderating role of switching cost on customer satisfaction and loyalty association. Using a survey questionnaire, the data was collected from 120 event organisers of corporations who have the experience of conducting corporate gatherings at hotels’ fine dining restaurants in the Klang Valley area. Partial Least Squares (PLS-SEM) method was used to analyse the reliability and the validity of the measurement model and the hypothesised relationships in the proposed research model. The findings supported the positive relationships between independent variables of the study (i.e. service quality, relationship marketing and corporate social responsibility) and customer satisfaction as a mediator. This research found that the switching cost in hotels’ fine dining consisted of non-monetary cost. The result of this thesis also supported the moderating role of switching cost in satisfaction and loyalty association. The result indicated high switching cost (non-monetary) will decrease the effect of customer satisfaction on loyalty.