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Archives of Business Research – Vol. 11, No. 1
Publication Date: January 25, 2023
DOI:10.14738/abr.111.13387.
Olivar, K. G., & Leon, A. W. (2023). Moderating Effect of Quality Delivery on Customer Satisfaction and Loyalty Relationship of
Multiple-Use Hotels. Archives of Business Research - Vol. 11(1). 120-134.
Services for Science and Education – United Kingdom
Moderating Effect of Quality Delivery on Customer Satisfaction
and Loyalty Relationship of Multiple-Use Hotels
Kiven G. Olivar
Ph.D. in International Hospitality Management,Lyceum of The Philippines University,
Claro M. Recto Academy of Advanced Studies Intramuros, Manila, Philippines
Ariel W. De Leon, MM
Hotel and Restaurant Services Professor
Asian International School of Aeronautics and Technology
Abstract
The main objective of this study was to determine the moderating effect of quality
delivery on the relationship between customer satisfaction and loyalty of multiple- use hotels in Davao City, Philippines. Adopted survey questionnaires were given to
a sample of 300 customers from various multiple use three-star hotels in Davao
City. This study employed non-experimental design utilizing descriptive
correlation technique. The statistical tools used were mean, Pearson r and
hierarchical logistic regression mod graph. Results revealed that the level of
customer satisfaction and quality delivery are very high whilst the level of loyalty
are found to be high. Further finding revealed that customer satisfaction is related
to loyalty. Quality delivery also showed a positive significant relationship to
positive significant relationship to loyalty. In determining the moderating effect of
quality delivery, results revealed that the quality delivery demonstrated a
significant moderating effect on the relationship between customer satisfaction and
loyalty of multi-use hotels. The multiple-use hotels who have higher quality
delivery to their customers have also higher level of customer satisfaction and
loyalty.
Keywords: Quality Delivery, Customer Satisfaction, Loyalty, Multiple-use Hotels
INTRODUCTION
The sudden outbreak of the COVID-19 epidemic, as well as its rapid spread, has impacted
negatively on many businesses (Sharma, Shin, Santa-Maria and Nicolau, 2021). Many hotels are
aware of the expense of gaining a customer, but not of the cost of losing one. Customers
discontinue doing business with a company for a variety of reasons, including the fear of
moving away, a lack of understanding of the worth of disgruntled customers, and so on. As
Khadka and Maharjan (2017) point out and cited by Olivar (2021), giving customers with value
often results in poor service, substandard products, and quality that does not fulfill customer
expectations.
The hotel industry, in particular, is one of the most important economic sectors, and it is today
a highly competitive market (Tong-On et al., 2021). According to the Department of Tourism
(2021), "Multiple-Use Hotels" are "Accommodation Establishments" that have been inspected
by a team comprised of Department of Tourism and Bureau of Quarantine personnel and
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Olivar, K. G., & Leon, A. W. (2023). Moderating Effect of Quality Delivery on Customer Satisfaction and Loyalty Relationship of Multiple-Use Hotels.
Archives of Business Research - Vol. 11(1). 120-134.
URL: http://dx.doi.org/10.14738/abr.111.13387
determined to be suitable for the accommodation of both quarantine and non-quarantine
guests due to compliance with standards for physical separation of guests. Furthermore, the
COVID-19 pandemic has had an impact on every economic sector (Goodell, 2020). Many
impacted countries are enacting travel and social distancing restrictions, which has a negative
impact on the tourism and hospitality industry (Gössling, Scott, and Hall, 2020). During the
epidemic, hotels around the world were forced to close, operate with little inventory, or face
government requisition (STR, 2020). Because they rely primarily on people in the roles of
customers and workers, hotel operations are subject to such calamities (Henderson and Ng,
2004; Chan, Gao and McGinley, 2021).
Hotels of all types and sizes are increasingly confronted with shifting conditions (Azam, Ab
Yazid, Khatibi & Mohamad, 2017; Olivar, 2021). There is an instant need to cope with changes,
whether they be slight or big. Dealing effectively with these issues in the external and internal
contexts while meeting expected efficiency requirements is a major task. Decision-makers
should consider all relevant elements by methodically assessing customer feedback in order to
determine the most appropriate actions and behaviors for pleasing customers and retaining
them. As a result, the hotel staff are forced to consider variables while deciding what to do and
how to accomplish it because of the planned management process structure. This study will
investigate the moderating effect of quality delivery on customer satisfaction and loyalty
relationships of multiple-use hotels in Davao City, Philippines, based on the problem
description and the research background.
The primary concern of this study is to probe the moderating effect of quality delivery on the
relationship between customer satisfaction and loyalty of three-star hotels in Davao City.
Moreover, this study was guided by the following objectives:
RO1. To measure the level of customer satisfaction of multiple-use hotels in terms of ambience,
hospitality, and added value;
RO2. To assess the level of loyalty of multi-use hotels in terms of attitudinal loyalty and
behavioral loyalty;
RO3. To ascertain the level of quality delivery of multi-use hotels;
RO4. To determine the significant relationship in terms of customer satisfaction and loyalty
and quality delivery and loyalty; and
RO5. To find out the moderating effect of quality delivery on the relationship between customer
satisfaction and loyalty of multi-hotels in Davao City, Philippines.
LITERATURE REVIEW
Customer Loyalty
Customer loyalty is in conjunction with a brand's positive attitude (attitudinal loyalty) and
repeated purchase behaviour (behavioural loyalty) toward the service providers (Kanyama,
Nurittamont and Siripipatthanakul, 2022). For instance, the customers prefer the same service
providers, whether the same or different, and may recommend it to friends and family (Chahal
& Bala, 2012; Siripipatthanakul & Bhandar, 2021; Siripipatthanakul & Sixl-Daniell, 2021).
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Services for Science and Education – United Kingdom
Customer loyalty could be measured as behavioural intention by the intention to reuse or a
willingness to repurchase in the future Sosanuy, Siripipatthanakul, Nurittamont, and
Phayaphrom, 2021; Nuanchaona, Siripipatthanakul, Nurittamont, Phayaphrom, 2021). The
importance of service quality as a strategy for businesses seeking to retain customer loyalty in
today's highly competitive environment is becoming increasingly apparent (Kanyama et
al.,2022). Therefore, customer loyalty can measure hotel service quality and satisfaction
regarding hotel revisit intention in the future.
Customer Satisfaction
In hospitality products and services, customer satisfaction is crucial (Olivar, 2021). Customer
satisfaction is critical to the success of hotel marketing since it effects both the hotel choice and
the customer's decision to return to the same hotel (Azam, Ab Yazid, Khatibi, & Mohamad,
2017). Customer satisfaction is derived from a positive customer experience, according to
(Oliver, 2014; Hinlayagan, 2018; Olivar, 2021). Perhaps one of the most important factors
contributing to the high level of customer satisfaction in the hotel business, which focuses on
developing loyalty, is customer experience.
Customer satisfaction has become one of the most significant factors that hotel management
must consider while providing services to customers. Customer satisfaction has a variety of
consequences, and it has long been thought to be a predictor of a company's future earnings
and profits (Forozia, Gilani & Zadeh, 2013). In other words, hotel service providers should
prioritize meeting the needs of their customers as their primary goals. Furthermore, because
customer satisfaction has become a determinant and predictable part of business, hotels will
be unable to compete with their competitors unless they can satisfy their consumers (Forozia
et al. 2013). They went on to say that customer satisfaction study aids hotel owners in
identifying their defects and limitations, allowing them to better meet the demands and desires
of their customers.
Quality Delivery
The importance of service quality to hotel performance has been well recognized in diverse
literature. It's a subjective and complex idea with different traits that set it apart from a product.
Because of its intangibility, heterogeneity, and inseparability, service quality differs from
product quality. The term "service quality" refers to how well offered services fulfill customer
expectations (Gaunker & Gaonkar, 2021). Several research have been carried out to investigate
the aspects of service quality that most significantly contribute to actual quality appraisals in
the service environment. It is vital to distinguish evidence of the factors of service quality since
it will aid in measuring, controlling, and improving the apparent service quality of clients
(Anwar, 2017; Anwar & Surarchith, 2015).
Correlation between Measures
Further research by Ismail, Zaki, and Rose shows that customer loyalty is a key outcome of the
relationship between quality delivery and customer satisfaction, and that it serves as a strong
correlation (2016). The results of this study revealed two key findings: first, service quality is a
significant predictor of customer satisfaction. This discovery has also supported and widened
previous research (Baldwin, Sohal, Ozturkcan, Aydin, Ates and Cetin, 2009; Al-Borie &
Damanhouri 2013; Ismail, Rose & Zaki, 2016). Second, customer loyalty is influenced by the
quality of service provided. This discovery has also bolstered and expanded previous research