Customer Based Performance of the Hotel Industry: Analysis of Service Package and Brand Innovations

Abstract

This study aims to examine the influence of service package and brand innovation on customer relational performance and customer profit performance of the hotel industry. Data were collected from 112 hotel operators. PLS-SEM was used to derive the path coefficient (β) and t statistics to determine the path relationship between service packages, brand innovation, customer based relational performance and customer based profit performance. This study shows that both service package and brand innovation have influence on both customer relational performance and customer profit performance. Brand innovation does not moderate the relationship between service package and customer relational performance of the hotel industry. The study findings may not be generalizable to other categories of the restaurant industry because of the relatively small sample size and the respondents selected from limited geographical area. The findings, however, will help hotel operators to implement critical packaging operations of the hotel services and improved brand innovations to elicit higher customers’ based performance. Unlike the previous studies on marketing performance, this study examines the combined effect of service package and brand innovation on customer based relational performance and customer based profit performance of the hotels.