The Impact of Corporate Social Responsibility Practices on Customer Retention in Hospitality Industry

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Executive Summary
The corporate social responsibility is considered to be an essential part of the organization and
with respect to this, it has become important for the different hospitality firms to ensure that they
are successfully able to take into consideration the various practices which will go a long way in
assisting the firm to undertake long term success. Although it is believed that the corporate social
responsibility practices generally have a strong impact on the overall profitability of the firm,
however, they are also believed to have a strong impact on the overall customer satisfaction and
retention of the organization. The hospitality industry is a highly volatile and customer oriented
industry, for which it becomes considerably important for them, to maintain differentiation in the
form of their different services and the CSR practices incurred in an organization. The research
proposal aims to present an analysis and find whether the CSR practices in an organization have
an impact on the customer retention with special reference to the hospitality industry and
specifically the hotel named Hilton Group of Hotels in Australia. The background of the study
will be provided, which will be followed by the review of literature and the framework. Lastly,
the research methodology will be provided which will lay down the different research methods
and overall ethical considerations considering the paper.

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Table of Contents
1. TITLE..........................................................................................................................................4
2. BACKGROUND AND RATIONALE........................................................................................4
Background..................................................................................................................................4
Introduction..............................................................................................................................4
Problem Statement.......................................................................................................................8
About the Hilton Group of Hotels in Australia...........................................................................9
Discipline.................................................................................................................................9
Review of Literature..................................................................................................................10
Introduction............................................................................................................................10
Corporate social responsibility..............................................................................................10
Factors affecting corporate social responsibility Practices....................................................11
Customer retention.................................................................................................................14
Factors affecting Customer retention.....................................................................................15
Theoretical framework...............................................................................................................18
Critical analysis.........................................................................................................................18
3. RESEARCH QUESTION(S).....................................................................................................19
Research Questions....................................................................................................................19
Research Objectives...................................................................................................................19
4. RESEARCH METHODOLOGY..............................................................................................20

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Resources being used.................................................................................................................20
Research Method.......................................................................................................................21
Research Philosophy..................................................................................................................21
Justification of the research philosophy................................................................................21
Research Approach....................................................................................................................22
Justification of the chosen research approach.......................................................................22
Research design.........................................................................................................................22
Justification for the chosen research design..........................................................................23
Data collection...........................................................................................................................23
Sampling and survey strategy....................................................................................................23
Survey Strategy......................................................................................................................24
Data analysis..............................................................................................................................25
Reliability and Validity..............................................................................................................25
Ethical consideration.................................................................................................................25
5. PLAN OF WORK & TIME SCHEDULE.................................................................................26
6. BIBLIOGRAPHY......................................................................................................................28

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1. TITLE
The title of the paper can be stated to be as follows:
The Impact of Corporate Social Responsibility Practices on Customer Retention in Hospitality
Industry: A case study of Hilton Group of Hotels, Australia.
Through the given approach, the paper aims to find out the effects of the different
corporate social responsibility practices which are adopted by the Hilton Group of Hotels on the
retention rate of the customers and guests who visit the hotel. The Corporate social responsibility
tends to form an essential part of the organization and through this initiative, various
organizations aim to contribute to the welfare of the society. Hence, in line of this, it can be
mentioned that, this corporate social responsibility practice tends to impact the overall perception
of the customers towards the organization and in addition to this, also impacts the customer
perception in the firm. Hence, through this research topic, the main aim is to find the impact of
the Corporate Social responsibility practices on the Customer retention of the different hotels in
the Hospitality industry, with special reference to the case of the Hilton Group of Hotels in
Australia.
2. BACKGROUND AND RATIONALE
Background
Introduction
According to Belal (2016) , there exists a general perception in today`s global business
environment that, the business has an increasing participative role to play in the society and the
main aim of the different hotels go beyond the simple profit making perspective. The Corporate
social responsibility as a concept has evolved and developed considerably from the last few days

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and it is with respect to this, that it can be understood that instead of just looking after the
different investors and the customers of the company, the firm will also be required to cater to
the needs of the larger society as well as community. This further highlights the importance of
the environmental aspect and focuses on the triple bottom line approach of enhancing the profit,
planet as well as people.
The hospitality industry is one of the most popular industries present in the globe and has
a large economical footprint both in terms of the employment as well as the revenue as earned by
the organization (Chernev & Blair, 2015). Moreover, the industry also makes consistent use of
the different natural resources like water, food and energy and also hence tends to engage in the
practices which tend to minimize the impact of the hotel or the business on the environment.
Certain examples of these initiatives can be stated to be the practices like increasing the fuel
efficiency in the airlines, reduction of the food waste as incurred in the restaurants, efforts to
save water and electricity as incurred in the hotels. In addition to this, in addition to look after the
different environmental concerns, the industry also aims to embrace and resolve the different
social issues like community development, encouragement of diversity in the workforce,
progressed employment policies and practices (Belal, 2016). Several hotels around the world
have bought about tremendous improvement in the entire procedure and certain examples of
these activities are undertaken by the Marriott International, Kempton Hotels, Hilton Worldwide
and the Wyndham Worldwide. In addition to this, the companies have also been able to win the
award for the Best Place to work in.
According to Crane, Matten & Spence (2019), the engagement by the different
companies in the different Corporate Social responsibility activities and practices can be
considered to voluntary and the extent to which the organization will undertake considerable

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initiatives for this outweighs the cost or the financial returns that a firm will earn on its different
activities. The nature of the hotel industry can render considerable outcomes for the overall
welfare of the society. In addition to this, these initiatives as taken by the different hotels as
present can improve the overall brand awareness as well as the loyalty for the customers.
Moreover, as the services provided by the organization are intangible, they are generally
evaluated based on the quality of the service which is provided by them (Hopkins, 2016). Hence,
the overall goodwill of the hotel tends to improve by the social initiatives which are undertaken
by the organization. Moreover, it also renders and gives way to practices which tend to transform
the brand image of the hotel, creating differentiation as well as creating a sustainable advantage
in a highly competitive industry. In addition to this, the different social initiatives as taken by
the organization will also increase the willingness of the consumer to pay premium prices and
hence, this helps any hotel to survive the seasonal demand and poor economic cycles. The new
generation of the customers are greatly inclined towards the environmental sustainability and are
socially very conscious. Moreover, several studies have also found that, the different customers
are now willing to pay a surge price of 15% or more if the hotel is engaging in sustainable
activities and are making use of the organic ingredients.
Apart from the consumer perspective, the Corporate Social responsibility practices which
are incurred in by the different organizations tend to attract as well as motivate the different
employees as well. The main reason, why this might be stated is because, the different
employees are willing to work with a company with a good image as well as reputation which
will help them to progress faster in their career and also offer diversity practices which shall
allow them to work effectively (Hopkins, 2016). The benefits of the employee engagement can
be extensively reaped in by the different hotels and they can experience a considerable growth as

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well as profitable activities. Hence, it can be considerably understood that the corporate social
responsibility initiatives have become an integral component of the high performance work
system.
Hence, the engagement in the corporate social responsibility activities need to be engaged
in not only with a focus on the return on investment of the organization but also to create a
positive change in the entire society. Additionally, the companies make use of the Corporate
Social responsibility as a mere marketing tool and engages in the green washing of the different
customers who are then attracted towards the firm. However, these activities often lead to
different consequences like backlash and loss of credibility. Moreover, the communication of
the corporate social responsibility initiatives are considered to be effective part of the
organization and the different stakeholders like the consumers, employees and related
stakeholders need to be aware of the different corporate social responsibility activities of the
firm.
Hence, in line of this, it can be rightfully understood that, the different organizations
often tend to engage in the publishing of various Corporate Social Responsibility reports which
will allow them to maintain transparency in front of the different customers. Therefore, in line
with this, it is important for the different firms to understand that the Corporate Social
Responsibility activities tend to be aligned with the overall competencies as well as the different
strategies of the firm. In addition to this, it also becomes considerably important for the
organization to gain exposure to the different stakeholders and opportunities which will be able
to impress the customers and hence, they may turn out to be more loyal than their current
scenario (Crane, Matten & Spence, 2019). This reserve of good activities may bring about
goodwill for the firm and help the hotel in dealing with the different negative activities. For this