Loyalty's link with repeat business questioned at Cornell

WM Circle Logo

By: Wise Marketer Staff |

Posted on September 15, 2004

A study published by Cornell University calls into question the common belief that a high level of hotel guest satisfaction means repeat business for hotel brands.

The article by Cornell Hotel School Professor Judy Siguaw, published in the August 2004 issue of the Cornell Hotel and Restaurant Administration Quarterly, asserts that the theory of satisfied guests generating repeat business in the lodging industry has been challenged by a study of 364 guests at two similar big-city hotels. Analysis showed only a weak connection between satisfaction and loyalty, which is usually seen as a precursor to repeat purchasing.

By examining factors including purpose of travel and demographics, the study found that business travellers were among the least loyal of the guests responding to this survey, which may give hoteliers reason for concern, considering the industry's significant expenditure on frequent guest programmes.

Study highlights
The study also found that:

  • The main factors that built guest loyalty were the hotel's design and amenities;
  • The foremost factor in the purchase decision was the standard service by hotel employees.

"The implication is that hoteliers might consider redirecting some of their frequent guest programme expenditure toward strengthening human resources and improving the guest experience through design and amenities," concluded Siguaw.

Full article
The full article has been made available on the Cornell Hotel School's web site. Judy Siguaw, D.B.A., is the J. Thomas Clark Professor of Entrepreneurship and Personal Enterprise at Cornell. She was supported in this report by Iselin Skogland, a recent Cornell Hotel School graduate. Now in its 44th year of publication, the Cornell Hotel and Restaurant Administration Quarterly is a journal of applied research serving hospitality practitioners and scholars.

More Info: