Relationship between Service Quality and Customer Loyalty: Evidence from Star-Rated Hotels in North Rift, Kenya

Abstract

The tourism and hospitality sector in North Rift Kenya have grown tremendously since 2013 due to several factors, the main being the onset of the devolved systems of Government which has helped to bring more resources closer to the people. However, this progress has not been accompanied by a corresponding improvement in the quality of services offered. The results of this mismatch have been the low occupancy levels and subsequent investor frustrations. Therefore, the study sought to find out whether or not attempts to keep loyal customers through effective relationship marketing practices can provide sustainable solutions to the prevailing state of tourism and hospitality in the North Rift region. Based on the study, this paper examines the link between service quality and customer Loyalty among star-rated hotels in North Rift. The utilised a descriptive survey research design. The target population for the study was made of 1416 loyal customers from the fifteen (15) star-rated hotels in North Rift region of Kenya. The sample size was 455 guests obtained using a stratified random sampling method. Data was collected using a questionnaire. Structural Equation Model (SEM) was applied with R value being estimated to analyse and test hypotheses. The study found that service quality played a significant role in achieving customer loyalty among star-rated hotels in the study area (p < 0.05). Therefore, the study recommends that hotels should enhance their service quality so as to achieve higher customer loyalty. Strategies such as appealing equipment, customer service refresher training, and competitive pricing were found to bring about better relational benefits to the customers.