Key factors affecting brand loyalty in hotel industry in ho chi minh city

This research shows othersdimensions of consumer-based brand equity as brand identification and ideal self-congruencebased on Ekinci et al.’s 2008 model of consumer satisfaction and Aake

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-Thai Hong Kim

KEY FACTORS AFFECTING BRAND LOYALTY IN HOTEL

INDUSTRY IN HO CHI MINH CITY

Ho Chi Minh City – Year 2014

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-Thai Hong Kim

KEY FACTORS AFFECTING

BRAND LOYALTY IN HOTEL

INDUSTRY IN HO CHI MINH CITY

ID: 22110031

SUPERVISOR: DR.DINH THAI HOANG

Ho Chi Minh City – Year 2014

I would like to express my sincere gratitude to Dr Dinh Thai Hoang who has supported me alot with the thesis preparation and motivated me throughout the journey of the thesis

I strongly believe that I could have not completed this thesis without the assistance from all

of my friends who helped me to guide the customers to do the survey and chased for datasubmission

I would like to take this opportunity to thank leaders, teachers and staffs in ISB who help meusefully all the subjects of my master course

Last at all, I would like to present the achievement to my family who supported andencouraged me during this time

July, 2014

Ho Chi Minh City, Viet Nam

Thai Hong Kim

TABLE OF CONTENTS

CHAPTER 1 : INTRODUCTION 1

1.1 Research background 1

1.2 Research Problems 1

1.3 Research Objectives 3

1.4 Research Scope 3

1.5 Research Structure 3

CHAPTER 2 : LITERATURE REVIEW 5

2.1 Consumer-based brand equity 5

2.2 Service quality: Physical quality and Staff behavior 6

2.3 Ideal self-congruence 8

2.4 Brand Identification 9

2.5 Consumer satisfaction and Brand loyalty 10

2.6 Research Model and Hypotheses 13

CHAPTER 3: METHODOLOGY 15

3.1 Research Process 15

3.2 Research Design 17

3.3 Measurement 17

3.4 Sample Selection 20

3.5 Data Collection 20

3.6 Data Analysis 21

CHAPTER 4: DATA ANALYSIS AND RESULTS 25

4.1 Descriptive Analysis 25

4.2 Measurement Assessment 26

4.2.1 Cronbach’s alpha 26

4.2.2 Exploratory factor analysis 32

4.3 Regression 38

4.3.1 Model 1: Multiple Regression Analysis with all independent variables and CS 38

4.3.2 Model 2: Multiple Regression Analysis with with consumer satisfaction variable as independent variable and brand loyalty as dependent variable 41

4.4 Hypothesis testing 43

4.5 Discussion of Findings 46

CHAPTER 5: CONCLUSION AND IMPLICATION 47

5.1 Conclusion 47

5.2 Managerial Implications 48

5.3 Limitations and Future Research 48

REFERENCES 50

APPENDICES 53

Recent years, the hotel industry in Vietnam is developing sharply The development of highstandard or luxurious hotels to satisfy the demand of consumers creates the competitivemarket Besides that, the return of Ho Chi Minh City hotel market through recent years is thegood news and also the challenge for the firms in this industry (2010-2013: hotel room

increased 35% , source: Alternaty, 2011-2013: total tourist arrival increased 11%, source:

The Ho Chi Minh City Department of Culture, Sports and Tourism) This development

reflects the growing of travelling, enjoying, eating and drinking demand of a large number ofhotel guests in a developing economy of Vietnam The firms in this industry need to payattention to maintain business performance through building the brand loyalty and also recruitnew users to develop themselves

This study aims to investigate which factor affecting brand loyalty and explores how thesefactors affect on brand loyalty

Keywords: key factors, hotel, brand loyalty

CHAPTER 1 INTRODUCTION

1.1 Research background

According to “Vietnam National Administration of Tourism Report” (2013), in the recent years,the international visitors came to Viet Nam increase continually: 5,049,855 turns (2010),6,014,032 turns (2011) and 6,847,678 turns (2012), 2011-2013: total tourist arrival increased

11%, source: The Ho Chi Minh City Department of Culture, Sports and Tourism) Besides,

attracting the number of domestic visitors rapidly 28 million (2010), 30 million (2011) and 32.5million (2012) Capturing the trends and potential of hotel industry in Vietnam, the existing andnew comers in this industry are facing with a strong competitive environment The issue is howthe firms in this industry survive and develop themselves

satisfaction investigates its impact on consumers’ post consumption evaluations such asbehavioral and attitudinal loyalty (Cooil, Keiningham, Aksoy, & Hsu, 2007).

It is widely accepted that satisfied consumers are less price sensitive, less influent bycompetitors’ attack and loyal to the firm longer than dissatisfied consumers (Dimitriades, 2006).This mean a satisfied consumer might spread the word about having a good experience, but adissatisfied one will almost certainly complain to at least one person, recommending that theirfriends do not use your product and looking for another supplier themselves This means lessmoney and less business for a company, with a strong possibility that at least a quarter of thedisgruntled consumers never deal with your business again Ekinci et al.’s (2008) study isnotable because it shows that service quality and ideal self-congruence are antecedents ofconsumer satisfaction They proposed these factors are key determinants of intention to return.With this parallel the concept and measurement of brand equity in the hotel industry has gainedconsiderable attention from academicians, practitioners, and researchers in recent years (Baileyand Ball, 2006; Kim and Kim, 2005; Prasad and Dev,2000; Cobb-Walgren et al., 1995)

Despite the availability of numerous definitions for brand equity in the literature, there is nocommon consensus about the meaning of brand equity and how a firm can measure the value ofthe brand (Bailey and Ball, 2006; Park and Srinivasan, 1994) This research shows othersdimensions of consumer-based brand equity as brand identification and ideal self-congruencebased on Ekinci et al.’s (2008) model of consumer satisfaction and Aaker’s (1991) model ofbrand equity Cai and Hobson (2004) suggest an integrated approach to successful branddevelopment and brand loyalty by taking into account brand experiences Accordingly, the effect

of brand equity on brand loyalty is examined when consumers have direct experiences withbrands (Brakus, Schmitt, & Zarantonello, 2009)

This study aims to identify the impacts of consumer-based brand equity on consumersatisfaction, and how consumer satisfaction affects the brand loyalty when its role is as anintermediate factor in this research model.

1.3 Research Objectives

The research objectives are:

- To identify factors affecting brand loyalty in Hotel industry

- To determine the impact of each factor on brand loyalty in Hotel industry

1.4 Research Scope

This study focuses on hotel consumers in Ho Chi Minh City; include three to five hotels, around big center districts at Ho Chi Minh City: district 1, 3, 5, Go Vap, Binh Thanh

1.5 Research Structure

The below structure is implemented for this research:

• Chapter 1: Introduction to introduce research background, research problem, research

objective, research question, research scope and structure of the research

• Chapter 2: Literature review This chapter reviews theories and selects the research’s factors as well as formulates the research hypotheses and model

• Chapter 3: Research methodology This chapter provides general idea how the research is designed and implemented

• Chapter 4: Data analysis, result and finding discussion This chapter translates data collected from survey, analyses data as well as discusses the result finding in connection with theory

• Chapter 5: Conclusion, implication, limitation and future research This Chapter concludes the research finding, provides implication, further suggestion as well as research limitation.

CHAPTER 2 LITERATURE REVIEW

There are many previous studies for the factors that affecting brand loyalty in hotel industry Inthis study, key concepts of Consumer based Brand equity, Physical quality, Staff behavior,Brand identification, Consumer satisfaction and Brand loyalty and their roles and importance inbusiness will be reviewed

2.1 Consumer-based brand equity

Prasad and Dev (2000) identified hotel brand equity as the favorable or unfavorable attitudes,then the perceptions are formed and influence a consumer to book at a hotel brand represent thebrand equity According to Bailey and Ball (2006) hotel brand equity is viewed as “the value thatconsumers and hotel property owners associate with a hotel brand, and the impacts of theseassociations on their behavior” Researchers also claimed that a hotel will have strong brandequity when a large number of customers have a favorable perception of and attitude toward thehotel brand

Brand equity is a perception of belief that extends beyond mere familiarity to an extent ofsuperiority that is not necessarily tied to specific action Familiarity does not imply belief insuperiority Brand equity does not imply action, only perception Commitment and loyalty also

do not imply superiority, whereas brand equity does (2008, p.152)

Empirical research conducted by Kim and Kim (2005) on luxury hotels tests the consumer basedbrand equity and its effects on company performance Based on earlier research in the serviceindustry (e.g., Ekinci et al.2008; Gronroos, 1984), study consists of four dimensions of customerbased brand equity: two service quality dimensions—physical quality and staff behavior areincorporated to the consumer-based brand equity model The third is ideal self-congruence and

brand identification are also included to capture symbolic consumption of the hotel brands (e.g.,Johnson, Herrmann, & Huber, 2006; Kim, Han, & Park, 2001).

This research model proposes that the dimensions of consumer-based brand equity, physicalquality, staff behavior, ideal self-congruence, brand identification have positive effects on brandloyalty via consumer satisfaction

2.2 Service quality: Physical quality and Staff behavior

Service quality is defined as “an overall assessment of service by the consumer” (Lewis andBooms, 1983, cited in Ganguli and Roy, 2010) It is central to the development of strong servicedominant brands because it helps to differentiate brands in competitive markets and help toenhances perceived superiority of the brands (Aaker, 1996; Low & Lamb, 2000; Yoo, Donthu, &Lee, 2000; Zeithaml, 1988) Service quality also are described as a form of attitude, related butnot equivalent to satisfaction based on the results from the comparison of expectations withperformance (Bolton and Drew, 1991; Cronin Jr and Taylor, 1992; Parasuraman et al 1988;Shepherd, 1999)

Service quality focus to the development of strong service domi- nant brands because it enhancesperceived superiority of the brands and helps to differentiate brands in competitive markets(Aaker, 1996; Low & Lamb, 2000; Yoo, Donthu, & Lee, 2000; Zeithaml, 1988) The concept ofservice quality is widely accepted as multidimen- sional, but the content and number of itsdimensions is still debated (Chao, 2008) Besides that, service quality is an antecedent of thebroader concept of consumer satisfaction (Gotlieb et al., 1994; Buttle, 1996; Zeithaml andBitner, 1996; Lee et al., 2000) and the relationship between service quality and loyalty ismediated by satisfaction (Caruana, 2002; Fullerton and Taylor (2002) Service quality is oftenhighly dependent on the customer’s contacts and relations with the employees His trust is often

more related to a specific person than to the company (Thomasson, 1993) Many researcherssuggested that high service quality resulted in high consumer satisfaction (Parasuraman,Zeithaml, and Berry, 1985, 1988) The model of service quality best known as the SERVQUALmodel of The North American School of Thought consists of five service quality dimensions:tangibles, reliability, responsiveness, assurance and empathy (Parasuraman, Zeithaml, & Berry,1988).

Although the SERVQUAL model had been applied by many research and academics, validity ofthe model is seriously questioned and being researched by many studies One of disagreements isabout the exact number of dimensions and its suitability to a specific service sector (Buttle,1996) The view of Nordic School is service quality consists of two dimensions: technical qualityand functional quality (Gronroos, 1984) Empirical studies (e.g., Brady & Cronin, 2001; Ekinci,2001; Madanoglu, 2004; Mels, Boshoff, & Nel, 1997) suggest that the two dimensional servicequality model offered by the Nordic School has more valid when applied to hospitality services.Considering the growing body of research in the service industry, this study mention two servicequality dimensions for evaluation of hotel brand equity: physical quality and staff behavior (e.g.,Brady & Cronin,2001; Ekinci et al., 2008; Parasuraman et al., 1988) Physical quality can beunderstood as the image projected by the design, equipment, facilities, and materials of the hotel.Staff behavior is the image projected by competence, helpfulness, friendliness, andresponsiveness of the hotel employees (Ekinci et al., 2008; Madanoglu, 2004)

Many researchers present conceptual and experienced evidence to support positive relationshipbetween service quality and consumer satisfaction For instance, Oliver (1993) found that servicequality is an antecedent of consumer satisfaction and both constructs should positively associatewith each other And there are numerous empirical researches confirm the positive relationshipbetween service quality and consumer satisfaction in the hotel industry (Heung, Wong, & Qu,

2002; Lam & Heung, 1998; Tam, 2000) Therefore, a service organization needs to understandhow consumers evaluate the quality of the service they receive and the basis on which theybecome loyal to that organization to satisfy its consumers (Kandampully, 1998) The quality of aproduct will determine if it satisfies consumers’ demands and attracts consumers to repurchase aproduct This research focuses on two separate dimensions of service quality: physical qualityand staff behavior, and explored that they are positively related to consumer satisfaction AsEkinci et al (2008) demonstrate that the two dimensions of service quality: physical quality andstaff behavior, have a positive effect on consumer satisfaction in the hospitality industry.Therefore, this research proposes that:

H1 Physical quality has a positive effect on consumer satisfaction.

H2 Staff behavior has a positive effect on consumer satisfaction.

2.3 Ideal self-congruence

Self-concept can be identified as the totality of an individual’s thoughts and feelings withreference to the person as an object of thought (Rosenberg, 1979) Sirgy, (1982); Helegeson andSupphellen, (2004); Galan, (2007) defined congruence into four types: congruence with the realself-image, congruence with the ideal image of self, congruence with the social self-image,congruence with the ideal social self-image Self-congruence refers to the degree to which aconsumer’s actual or ideal self-concept coincides with a brand image (Sirgy, 1982; Sirgy,Grewal, & Mangleburg, 2000) Individuals only consume the products which do reflect theirgenuine self (Galan, 2007) The theory of self-congruence states that people buy or own brands

in order to sustain or enhance their self-esteem (Graeff, 1996)

The same story with prior research, the current study adopts the view that self-congruence relates

to the extent to which brand image consists with consumer’s ideal self-concept (Ekinci et al.,2008; Hong & Zinkhan, 1995)

The positive relationship between ideal self-congruence and consumer satisfaction in tourismand hospitality is explained through previous studies For instance, Chon’s (1992) studydemonstrates a positive relationship between ideal self-congruence and tourists’ satisfaction with

a destination visit experience Bigne, Sanchez, and Sanchez (2001) show that similarity betweentourists’ self-concept and destination image has a significant effect on consumer satisfaction.Ekinci et al.(2008) examine the impact of ideal self-congruence on consumer satisfaction in thehospitality industry They confirmed that ideal self-congruence has a positive influence onconsumer satisfaction Thus, this study hypothesizes was proposed:

H3: There is a positive relationship between ideal self-congruence and consumer satisfaction

2.4 Brand Identification

Organizational identification theory states that an individual be-comes a member of a socialgroup in order to support his identity and his sense of belonging (Mael & Ashforth, 1992).Referring to social identification and categorization theory, an individual will identify with asocial category when the social category enhances an individual’s self-esteem An indentifiedindividual will engage in positive pro category behavior to preserve the attractiveness of thesocial identity (Bhattacharya and Sen, 2003; Taifel and turner, 1985) Besides, consumers definetheir social identity by consuming brands or associating with brands (Del Rio, Vazquez, &Iglesias, 2001) The positively value of brands enjoy a good reputation among the groups towhich they belong or considerate to belong (Long & Shiffman, 2000)

Consumers are satisfied with a brand when brand identification represents their positive imagewithin social groups or achieves sense of belonging to a social group (Ferreira, 1996; Kim et al.,2001) Previous studies show that brand identification stimulates symbolic interaction emotionalbonding and brand loyalty Thus, this study showed that stronger consumer identification with abrand results in greater consumer satisfaction.

H4 Brand identification has a positive effect on consumer satisfaction.

2.5 Consumer satisfaction and Brand loyalty

“Consumer” is defined by many researchers from different perspectives A consumer is a person,company or other entity that purchases goods and services produced from others According to(Oliver, 1996, p.14), satisfaction can be defined as “…the consumer’s fulfillment response It is ajudgement that a product or service feature, or the product or service itself, provided apleasurable level of consumption-related fulfillment, including levels of under or overfulfillment” Consumer satisfaction is defined as an "evaluation of the perceived discrepancybetween prior expectations and the actual performance of the product" (Tse and Wilton, 1988,Oliver 1999)

Satisfaction is initially defined by Locke (1976, as cited in Bhattacherjee, 2001) in the context ofjob performance as “a pleasurable or positive emotional state resulting from the appraisal ofone’s job.” This definition is extended by Oliver (as cited in Bhattacherjee, 2001) to theconsumption context as “the summary psychological state resulting when the emotionsurrounding disconfirmed expectations is coupled with the consumer’s prior feelings about theconsumption experience.”

In research and practice field, customer satisfaction is still an abstract and rather ambiguousconcept (Corneliu et al., 2010) Customer satisfaction towards a service is an emotional feeling

after using the service which is transaction-specific evaluation (Cheng et al.; Spreng and Singh;Oliver, as cited in Pham Ngoc Thuy and Le Nguyen Hau, 2010) Cronin & Taylor (1992)indicated that customer satisfaction is conceptualized on the customer‘s experience on aparticular service encounter Consumer satisfaction with products or services of a company isviewed as the most important factor leading toward success and competitiveness (Hennig-Thurauand Klee, 1997).

Consumer satisfaction is actually how consumer evaluates the ongoing performance of thecompany (Gustafsson, Johnson and Roos, 2005) Due to Kim, Park and Jeong (2004), consumersatisfaction is consumer’s judgment of satisfaction level and consumer’s reaction to the state ofsatisfaction Consumer satisfaction is the overall evaluation to the services Nowadays, consumersatisfaction is very important when do business as according to Deng et al., (2009) the ability of

a service provider to create high degree of satisfaction is important for product differentiationand building strong relationship with consumers Consumers who get satisfied will repurchaseand would like to share or recommends their good experiences to other people like their family

or friends (Kotler & Armstrong, 2010) It is the reflection that consumers make to their previouspurchases If it always meets and exceeds consumers’ expectation, their loyalty increases Anddissatisfied customers have no bond of loyalty with the company

Loyalty comes from consumer satisfaction Consumers become loyal when they feel satisfiedfrom the quality of the service provided by the companies (Beibei, Shiyang &Jiahong) Recentlyconsumer loyalty has become an important key to success because it is considered able.Customers’ loyalty about any brand would like to tell their tendency of purchasing and using aproduct and repeated using that product (Chaudhuri, 1999)

There are many factors to evaluate companies’ financial performance and competitiveness in themarket According to (Reichheld, 2001), consumer loyalty has become one of important keys to

success in a company According to (Claude, 2012) claims that consumer is an entity with theability to choose products and suppliers and receive goods or services Fred Reichheld definesloyalty as the willingness to make an investment or personal sacrifice to strengthen a relationship(Reichheld, 1996) Thus, consumer loyalty is the ultimate reward that a supplier receives in hiseffort in interacting with its consumer (Kharibam, 2012) “True loyalty can only exist if theconsumer embraces a positive attitude towards a specific company and suggest that favorableattitudes influence repeated purchasing.” Jensen and Hansen (2006), Aaker (1991, p 39) definesbrand loyalty as ``the attachment that a consumer has to a brand.''

According to Aaker (1991), brand loyalty is a basis of brand equity that is created by manyfactors, chief among them being the use of experience Keller (2000) stated that brand loyaltycertainly seems to be key variable for management interested in the value of brand equity whenmeasure from a consumer perspective

Also, from Kotler (2003), brand loyalty plays important role for the success of product Themarketers show that many companies had illusions to find new market and to forget bringing upcurrent market, while profit gaining from current market is much higher than new market due tolow marketing expense Therefore, higher brand loyalty from customers is higher profits forcompany

Rust and Zahorik (1993) prove a relationship between consumer satisfaction and brand loyalty inthe retail banking and hotel industry McDougall and Levesque (1994) show that consumersatisfaction has a positive effect on brand loyalty in different service sectors: dentistry, autorepair services, restaurants, and hairdressers Faullant, Matzler, and Fuller (2008) confirm thepredictive ability of consumer satisfaction on loyalty Thus, we propose that:

H5: There is a positive relationship between consumer satisfaction and brand loyalty.

2.6 Research Model and Hypotheses

Based on the above studies, a conceptual model is proposed Details about a conceptual model and it hypotheses as follows:

H1 Physical quality has a positive effect on consumer satisfaction.

H2 Staff behavior has a positive effect on consumer satisfaction.

H3: Ideal self-congruence has a positive effect on consumer satisfaction

H4 Brand identification has a positive effect on consumer satisfaction

H5: There is a positive relationship between consumer satisfaction and brand loyalty.

Consumer satisfaction

Figure 1: A Conceptual Model

All key concepts of Consumer based Brand equity, Physical quality, Staff behavior, Brand identification, Consumer satisfaction and Brand loyalty and their important roles in business had

been reviewed through chapter two The findings showed that consumer satisfaction partiallymediates the effects of physical quality, staff behavior, ideal self-congruence and brandidentification on brand loyalty The effects of physical quality on brand loyalty are fullymediated by consumer satisfaction.

CHAPTER 3 METHODOLOGY

Methodologies will be explained in this chapter to collect the data to address the research issues

of this study It starts with the research design process, questionnaire design It providesinformation about the sample demography It further describes the instruments, the datacollection processes and the type of analysis carried out on each phase of the study

3.1 Research Process

Figure 3.1: Research Process

After the research problem the research objectives and research scope were defined Theliterature review was conducted to review all relevant theories to find a suitable conceptual

model for hotel industry in Viet Nam and thereby develop its hypotheses The draft questionnairewas developed from the consolidation of various questionnaires used in some previous studies ofthe extant literature Then the Research Design in this study was designed in two steps: a pilotstudy and main survey.

This research focused on what factors influence consumer to be loyal to a specific hotel Duringthis process, it shows the relationship between brand equity’s elements and brand loyalty cannot

be separated After recognizing consumer satisfaction as an important element, the next step was

to find theories related to this abstract subject With this information, the researchers coulddefine that Physical service, Staff behavior, Ideal self- congruence, Brand identification may bethe factors that could influence Consumer satisfaction and Consumer satisfaction might affectBrand loyalty of individual users in this industry

The questionnaires for consumers will be created based on previous research, which helped us tofind out more about the thoughts of consumers After collected enough data from thequestionnaires, the researcher transfer them into statistical data and analyzed the data From thedata collected from this main survey, the measures were assessed by Exploratory Factor Analysis

to explore the inter-relationships among a set of variables The inter-correlations among thevariables were considered strong when the correlation matrix for evidence of coefficients was0.3 Barlett’s test of sphericity was significant (p<0.5) and the KMO index was greater than 0.6and ranges from 0 to 1 Based on this outcome, the hypothesized conceptual model wasmodified Cronbach’s Alpha was employed to assess the measurement scale reliability by testingthe internal consistency among variables of the same construct The scale was considered reliablewhen the Cronbach’s Alpha coefficient is above 0.7

After the reliability was confirmed, multiples regression analysis was employed to test thehypotheses Then this research can connect the data to the theories, thus allowing the analyzed

data to connect to the theories so that the researchers finally were able to see how these factorscould affect people to be loyal to a brand of hotel.

3.2 Research Design

Research can be defined as a “structured inquiry that utilizes acceptable scientific methodology

to solve problems and create new knowledge that is generally applicable” (Grinnell, 1993).Inductive research begins with detailed observations of the world, which moves towards moreabstract generalizations and ideas (Neuman, 2005) This study focused on investigating brandloyalty based on theoretical part that had mentioned in chapter 2 Since the researchers usedtheory and made a survey by quantitative approach in this thesis, it fulfilled the requirements ofdescriptive approach, therefore, this thesis used descriptive research approach to analyze data.Bryman and Bell (2011) defined quantitative research concerned with the measurement andanalysis of relationships between variables rather than processes It expresses the data in theform of numbers and analyzes the results of statistics Quantitative research is used to quantifydata and generalize results, measure the incidence of various views of chosen sample

Therefore, the quantitative researchers use mathematical models and statistical tables to relate tothe research in transpersonal terms To measure up the descriptive research approach andapprove the theory, numerical data is needed This study used quantitative research approachcomplemented with a questionnaire in order to find out what factors brand loyalty of consumers

3.3 Measurement

Quantitative research

All measurements were carried out by the statements adopted from previous studies and a point Likert type scale ranging from (1) Strongly Disagree to (5) Strongly Agree The servicequality measures consist of physical quality and staff behavior statements adopted from Ekinci

5-(2001) and Madanoglu (2004) and Parasuraman et al (1988) Measurement of ideal congruence used the method introduced by Sirgy et al (2000) and later used by Back (2005)which suggests that processing self-congruence is global, direct and not dimension-based.

self-After reading this direction, consumers responded the three self-concept statements to registertheir ideal self-congruence Brand identification measurement was carried by organizationalidentification measures (Mael & Ashforth, 1992) Consumer satisfaction was carried byWestbrook and Oliver's (1991) with four statements Finally, brand loyalty was operationalized

by four statements taken from Bloemer, De Ruyter, and Wetzels (1999) and Zeithaml, Berry, andParasuraman (1996) and (Kayaman & Arasli, 2007)

Table 3.1 Measurement scale

No Items Sources

A Service Quality: Physical Quality

1 This brand has modern-looking equipment

2 This brand’s facilities are visually appealing Ekinci (2001) and

Madanoglu (2004)

3 This brand gives you a visually attractive room

Materials associated with the service (such as menus,

4 furniture) are visually appealing

B Service Quality: Staff Behavior Ekinci (2001) and

1 Employees of the hotel listen to me Madanoglu (2004)

2 Employees of the hotel are helpful Parasuraman

et al (1988)

3 Employees of the hotel are friendly

4 Employee of the hotel give prompt service to the patrons

5 Employee of the hotel are always willing to help patrons

C Ideal Self-Congruence

The typical guest of this brand has an image similar to how I

1 like to see myself Sirgy et al (2000)

If a story in the media criticizes this brand, I would feel

1 embarrassed Mael and

Ashforth (1992)

2 You trust and like this hotel

Consuming the services of the hotel highlights your

3 personal characteristic

E Consumer Satisfaction

Would you agree to say “I am satisfied with my decision to

1 visit this hotel”?

Would you agree to say “My choice to stay at this hotel was

Westbrook and

2 the wise choice”

Oliver's (1991)

Would you agree to say “I think I did the right thing when

3 choose to stay in this hotel”

Would you agree to say “I feel that my experience with this

4 hotel has been enjoyable”

I usually use my favourite hotel/restaurant as my first choice

1 compared to other hotel brands

2 Next time I will stay in this brand

I’m willing to pay high to stay in this hotel even the other

3 hotel has the same quality

4 I will recommend this brand to someone who seeks my advice

Ruyter, and Wetzels (1999) and Zeithaml, Berry, and Parasuraman (1996) and (Kayaman & Arasli, 2007)

3.4 Sample Selection

The sample size of this research is 230 people As convenience samples are generally thecheapest and easiest to conduct Convenience sampling is most often used during the exploratoryphase of a research project and is perhaps the best way of getting some basic information quicklyand efficiently So, convenience sampling was used to collect data 230 consumers are picked outrandomly from the internet, organization, forum relating to Hotel industry Besides, thequestionnaires will be sent to travelers who the researcher got information from two travelagencies that they used to stay in well-known hotels

occupations and choosing from the internet, street and hotels, and from the list of travelers whichresearcher collected from two travel agencies.

3.6 Data Analysis

All accepted questionnaire were reviewed for completion, coded and input the raw data in IBMSPSS Statistic version 20 The reliability and validity of measurement scales were evaluated byusing Cronbach’s alpha and exploratory factor analysis Then, multiple regression analysis is used to provide for interpreting the results of its application from a managerial and statistical viewpoint (Hair et al., 2010) The list of codified measurement scale is shown in Appendix 2

Pilot test results

Measurement scales of pilot test were tested through two steps At the first step, a focus groupinterview with sample of five consumers who used to stay at three to five stars hotel in Ho ChiMinh City The component Staff behavior was carried by Ekinci (2001) and Madanoglu (2004)with three statements and Parasuraman et al (1988) with last two statements In the research ofParasuraman et al (1988) has eight statements relating to staff behavior but in this study has onlytwo of them because six of them has the same meaning or unclear meaning with the first threestatement

The next step used quantitative research with sample n= 30 These scales were modified by usingtwo methods: (1) Cronbach’s alpha and (2) exploratory factor analysis (EFA) Observed variablehad Cronbach’s alpha less than 0.7 and factor loading less than 0.4 in EFA (Gerberg &Anderson,

as cited in Nguyen & Nguyen, 2008) would be removed After modifying scales, remainingobserved variables would be used for main survey

Table 3.2 Cronbach’s alpha of pilot testing

Scale Corrected Item- Squared Cronbach's Scale Mean if

Variance if Total Multiple Alpha if Item Item Deleted

Item Deleted Correlation Correlation Deleted

PQ01 11.0 4.3 777 618 873PQ02 10.9 4.2 810 664 861PQ03 10.7 5.0 710 520 896PQ04 11.2 4.6 832 693 854

SB01 15.4 4.2 730 590 878SB02 15.3 4.2 822 698 857SB03 15.2 4.3 766 636 869SB04 15.4 4.6 734 564 877SB05 15.4 4.3 686 521 888

ISC01 7.0 2.2 878 772 894ISC02 7.0 2.3 859 739 908ISC03 7.2 2.4 860 742 910

BI01 7.3 1.9 831 694 839BI02 6.5 2.0 809 664 859BI03 6.7 2.0 782 612 882

CS01 11.1 6.7 940 924 960

CS02 11.3 7.1 944 916 960CS03 11.4 7.3 906 882 970CS04 11.2 6.6 936 923 962

BL01 11.2 9.3 880 782 954BL02 11.0 8.6 924 858 941BL03 11.6 9.9 884 791 954BL04 10.9 8.8 929 865 939

CHAPTER 4 DATA ANALYSIS AND RESULTS

This chapter presents the descriptive of collected data The reliability and validity of data will be

assessed by using Cronbach’s alpha and EFA After that, the hypotheses will be tested by the

collected data Consequently, this chapter includes four parts: descriptive analysis, measurement

assessment, regression, hypotheses testing

4.1 Descriptive Analysis

A sample of 183 shoppers includes 73 men (40 per cent) and 110 women (60 percent), aged from

16 to over 36 years old In terms of income, the majority of shoppers had a monthly income of

VND 11,000,000 – 15,000,000 with four percent All respondents used to stay in three to

fivestars in Ho Chi Minh City

Table 4.1 Descriptive Statistic of Sample

4.2 Measurement Assessment

4.2.1 Cronbach’s alpha.

The result of Reliability test of each scale showed that all the measurement scales were reliable

The results from the official assessment of the measures were very close to the pilot testing

results In each construct, the alpha values of the overall constructs were higher than the alpha if

item deleted All the values of Cronbach’s alpha are in the range 0.850 (brand loyalty) through

0.935 (consumer satisfaction) (see Table 4.1, Appendix 3).That means the data is good for

conducting exploratory factor analysis

Corrected Item – Total Correlation values of all variables were archived with values greater than

0.3 which indicates that the items form a scale that has reasonable internal consistency reliability

Cronbach’s alpha of Physical quality

Factor has four items, the Alpha of factor was 0.883 and the Corrected Item-Total Correlation of

each item are achieved with values greater than 0.3, which indicates that the items form a scale

that has reasonable internal consistency reliability

Table 4.2 Cronbach’s alpha of Physical quality

Scale Mean Scale Corrected Squared Cronbach's

if Item Variance if Item-Total Multiple Alpha if ItemDeleted Item Deleted Correlation Correlation DeletedPQ1 11.1749 4.563 794 632 829PQ2 11.1093 4.504 775 605 838PQ3 11.0765 5.555 699 493 870PQ4 11.1311 4.851 732 543 854

Cronbach’s alpha Staff behavior

Table 4.3 Cronbach’s alpha of Staff behavior

Reliability Statistics

Cronbach's Alpha BasedCronbach's Alpha on Standardized Items N of Items

Item-Total Statistics

Corrected Squared Cronbach'sScale Mean if Scale Variance Item-Total Multiple Alpha if ItemItem Deleted if Item Deleted Correlation Correlation DeletedSB1 15.1421 4.760 728 547 850SB2 15.1913 4.551 730 542 849SB3 15.0656 5.095 638 426 870SB4 15.3279 4.452 735 562 848SB5 15.1202 4.667 732 551 848

Factor has five items, the alpha factor was 0.879 and the Corrected Item-Total Correlation of

each item are achieved with values greater than 0.3, which indicates that the items form a scale

that has reasonable internal consistency reliability

Cronbach’s alpha of Ideal self-congruence

Table 4.4 Cronbach’s alpha of Ideal self-congruence

Reliability Statistics

Cronbach's Alpha BasedCronbach's Alpha on Standardized Items N of Items

Item-Total Statistics

Corrected Squared Cronbach'sScale Mean if Scale Variance Item-Total Multiple Alpha if ItemItem Deleted if Item Deleted Correlation Correlation DeletedISC1 6.9126 2.344 748 580 873ISC2 6.8142 1.943 844 713 789ISC3 6.8743 2.319 767 616 857

Factor has three items, the alpha factor was 0.889 and the Corrected Item-Total Correlation of

each item are achieved with values greater than 0.3, which indicates that the items form a scale

that has reasonable internal consistency reliability

Cronbach’s alpha of Brand identification

Table 4.5 Cronbach’s alpha of Brand identification

Reliability Statistics

Cronbach's Alpha BasedCronbach's Alpha on Standardized Items N of Items

Item-Total Statistics

Corrected Squared Cronbach'sScale Mean if Scale Variance Item-Total Multiple Alpha if ItemItem Deleted if Item Deleted Correlation Correlation DeletedBI1 7.4044 1.440 768 599 825BI2 6.6885 1.754 793 629 819BI3 6.9126 1.454 756 577 837

Factor has three items, the alpha factor was 0.877 and the Corrected Item-Total Correlation of

each item are achieved with values greater than 0.3, which indicates that the items form a scale

that has reasonable internal consistency reliability

Cronbach’s alpha of Consumer satisfaction

Table 4.5 Cronbach’s alpha of Consumer satisfaction

Reliability Statistics

Cronbach's Alpha Based onCronbach's Alpha Standardized Items N of Items

Factor has three items, the alpha factor was 0.935, very high, and the Corrected Item-TotalCorrelation of each item are achieved with values greater than 0.3, which indicates that the itemsform a scale that has reasonable internal consistency reliability.

Cronbach’s alpha of Brand loyalty

This research measured the brand loyalty of consumer through 4 items and the alpha of theseitems was 0.850, the Corrected Item-Total Correlation of each item are achieved with valuesgreater than 0.3, which indicates that the items form a scale that has reasonable internalconsistency reliability

Table 4.6 Cronbach’s alpha of Brand loyalty

Reliability Statistics

Cronbach's Alpha Based onCronbach's Alpha Standardized Items N of Items

Item-Total Statistics

Scale Mean Scale Corrected Squared Cronbach's

if Item Variance if Item-Total Multiple Alpha if ItemDeleted Item Deleted Correlation Correlation DeletedBL1 11.4918 3.482 703 501 804BL2 11.4699 3.646 686 474 811BL3 11.4426 3.611 647 418 828BL4 11.5464 3.535 723 528 795

4.2.2 Exploratory factor analysis

Research model has six group of items (variables) with 23 observed variables, affecting brandloyalty in hotel industry in Ho Chi Minh city After testing the reliability of the scale item-groups, researcher conducted exploratory factor analysis (EFA) through the Principal AxisFactoring, using the Promax rotation method to analyze 23 observed variables Using KMO(Kaiser-Meyer-Olkin) and Barlett’s test method to measure the compatibility of the survey andthe results After running, the results showed that the variables of all factors had high loading inthat factor and the variables of each factored measured only one component The EFA resultsshowed in these below table proved that the KMO values of all factor were bigger than 0.8 at theBarletlett’s Test of Significant 000 < 0.05 Therefore the results were satisfied the conditions ofEFA

4.2.2.1 EFA analysis results for measurement scales of independent factors (physical quality,

staff behavior, ideal- self congruence, brand identification)

Table 4.7 EFA analysis results for measurement scales of independent factors

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy .904Bartlett's Test of Sphericity Approx Chi-Square 1846.195