Loyalty Card Scheme Impact on Customer Satisfaction: Hilton

This research project examines the impact of loyalty card schemes on customer satisfaction within the hospitality sector, focusing on Hilton Hotel. The report includes an introduction outlining the background, aims, and objectives, followed by a literature review exploring customer satisfaction, loyalty card schemes, and their effects. The methodology section details the research type (qualitative and quantitative), research approach, data collection methods (primary and secondary), sampling techniques, and data analysis procedures. A timeline for the study is also provided. The study aims to assess the influence of loyalty programs on customer satisfaction, incorporating questionnaires and surveys to gather primary data from Hilton customers. The findings are supported by literature review and graphical presentation. The project also touches upon the reliability and validity of the research methods. The report concludes with a comprehensive list of references.

RESEARCH PROJECT

TABLE OF CONTENTS
Topic: To assess impact of loyalty card scheme on customer satisfaction in hospitality sector: A
study on Hilton hotel........................................................................................................................1
Background of study...................................................................................................................1
Research aim and Objectives......................................................................................................1
Literature Review........................................................................................................................2
Research Methodology...............................................................................................................4
Timeline of study........................................................................................................................5
REFERENCES................................................................................................................................7

Topic: To assess impact of loyalty card scheme on customer satisfaction in
hospitality sector: A study on Hilton hotel
Background of study
Hospitality industry is referred as broad group of business which gives services to
consumers as it is laying special emphasis on customer satisfaction and gives memorable
experience to them. It is highly unique because it is highly relied on free time and discretionary
income. There will be discussion on influence on consumer with customer loyalty program
provided by hotels on basis of customer satisfaction. Loyalty programs are framed for rewarding
the best customers. There are various business owners who implements reward program for
purpose of retaining current consumers and for getting new one. The loyalty programs such as
points and frequency programs, rebate or cashback program which has plenty of advantages for
hotel along with consumers as well. As these programs provide customer with incentive for
buying it again and again as opportunities are offered for up-sell or cross-sell. Similarly, these
programs had reflected increment in brand awareness and produced positive return on
investment.
Research aim and Objectives
Aim: To analyse the impact of loyalty card scheme or program with context of customer
satisfaction of hospitality sector.
Objectives
 To assess impact of loyalty card scheme.
 To identify measure of customer satisfaction with hospitality sector
Research question
 What is loyalty card scheme?
 How customer satisfaction is associated with loyalty card program?
 What are measures for determining customer satisfaction with hospitality sector?
Rationale: This study has been evaluated for extracting impact of loyalty card scheme
with customer satisfaction with reference to hospitality sector in Hilton hotel. This will help
in maximising performance and for developing strategy as if it had attained positive impact
then will be highly useful for business entity to improve its financial position and competitive
advantage in market (Research methodology, 2018). Furthermore, most important point is
1

that customer satisfaction is key point observed in hospitality industry as if it is solved then
one step towards success has been completed.
Literature Review
Theme 1: Customer satisfaction and its significance in hospitality sector
As per views of Kim and Jang (2014) customer satisfaction is established with key causal
agent which is responsible for experience on basis of alteration in attitude. Satisfaction is
replicated as post choice to evaluative judgement which is highly concerned with particular
selection of purchase. This concept is differing by attitude towards brand or product which is
signified in generalised evaluation of specific class of purchase object. It is evaluated with basis
of pre purchase of consumer expectation and comparing it by perceived performance of product.
However, Hwang and Mattila (2018) has stated that, satisfied customer is always replicated as
loyal to an organization till service he is getting is better than other business entity . With context
of business loyalty is referred as commitment of customer for performing business with specific
entity buying goods and services on repetitive manner and with words of mouth marketing.
Theme 2: Loyalty card schemes and its impact on hospitality sector
According to Kotler, Bowen and Makens, (2014), customers felt appreciated and values
with context of loyalty program as it makes them in continuation for doing business with them.
The customers could be retained through rewarding them for behaviour of repeat purchase as it is
one reason where business designs loyalty program and attain benefits. Similarly, reward
program offers businesses with direct line communication to its customers as it helps for building
brand awareness and increment in loyalty by giving valuable information on daily aspect. This
announces information related to new services or products, events and promotion along with
update of reward program and special offers as well. If customers are highly aware about
business offers, then there is great possibility for not only returning as they will share
information with its family and friends.
On the contrary, (Das, 2014) has stated that all loyalty programs look similar as multiple
business have framed thousands of programs throughout nation as many has identical
requirements of purchase and member advantages. The average of household is participating
actively in more than programs of nine reward where consumers could be overwhelmed. It also
2

creates difficulty for business for producing excitement about program unless it forms something
distinguishable and unique.
As per views of Marinkovic and et.al., (2013), loyalty programs is used as avenue for
attracting innovative customers as presence of loyalty rewards raises frequency of visit of
customer which is highly important to business The customers always try for redeeming awards
as it raises amount of spending of customer with each time patron in business as reward
programs helps for tracking about popular products and services with its common purchase.
Furthermore, main reason for implementing rewards program in business which will lead to
business with reference to word of mouth marketing. However, Bijmolt and et.al., (2018) has
stated that loyalty framework is very difficult for breaking away with transactional spirit. Often,
it has appearance with frequent buyer is replicated as loyal but might be not in case with buying
from business entity due to convenient factor. It might because of purchasing behaviour with
advantage of loyalty program has been provided with form of rewards. Hence, loyalty is
considered as essence of emotion which might be not gauged through loyalty program.
Cai and Chi (2018) has stated that loyalty programs has presence of two vital components
which goes in program of excellent reward for increment of customer satisfaction. The best
programs are very easy for understanding perspective as it will not complicate multiple things
whereas things be very easy. In the similar aspect, the excellent reward program will be created
in ease format with customer perspective. There will be avoidance of providing codes of
additional coupon with need of customers for joining separate reward programs. In this aspect,
customers are very loyal with its spending and application of rewards. In case customer are not
satisfied in efficient aspect, then they will indulge in word of mouth marketing with negative
points which will lead to damage in brand reputation.
On the contrary Kotler, Bowen and Makens (2014) has stated that loyalty programs with
hope of bringing repurchases on basis of historical behaviour of consumers but with context of
income, time, lifestyle and needs alteration. In this context, there will be always alteration in
buying pattern as well so people will always give preference for opting out from old form with
loyalty program. The data of loyalty do not observe purchases through other brands and stores
but this will give limited picture to overall consumer's purchase behaviour. The panel data of
consumer might be always highly representative as compared to loyalty card member data.
3

Henceforth, customers might be offended with uncomforted sharing its sensitive information for
attaining program incentives.
Research Methodology
Research Type: There will be application of both qualitative and quantitative research
which will be based on questionnaire data. The qualitative research will be structured with
gathering and analysing data with attainment through multiple sources. There will be extraction
of relationship among mobile service parameter with customer perception and association with
overall consumer satisfaction. The questionnaire will be framed by conducting survey on various
quality of service parameters through customer perspective and building metrics of customer
service after incorporating customer voices. It will be laying special emphasis on loyalty card
programs, customer care and more value added services as questionnaire will be formed in this
aspect.
Research approach and philosophy: In order to assess the impact of loyalty card scheme
on customer satisfaction level inductive approach and interpretivism philosophy will be used.
The rationale behind the selection of this approach is that it highly suits to the qualitative
investigation type and thereby helps in addressing research aim as well as objectives more
effectually.
Data collection: There will be collection of data via primary and secondary sources of
data. Primary data will be directly undertaken through the users whereas secondary data will be
used as published articles, scholarly journals and research papers, magazine and authentic
internet websites related to customers satisfaction & loyalty card schemes. The data will be
collected by conducting survey from the sample. Hence, for this purpose questionnaire will be
sent to 40 customers of Hilton with the motive to gather primary data set.
Sampling: There are two types of sampling as probability and non- probability as in
probability respondents are chosen in such aspect where every member of population is studied
with presence of non-zero chance of getting selected. In non-probability sampling, particular
elements through population in this study have been predetermined in non-random fashion with
context of judgement of researcher or decision for selecting specified number of respondents
with particular group. There will be application of non-probability sampling in which
convenience sample will be used with customer associated with Hilton hotel from whom
4

information could be obtained. In this context, simple random sampling will be applicable for the
selection of 40 customers of Hilton. .
Data analysis: In order to analyse gathered data set thematic perception test technique
will be applied. In accordance with this, themes will be framed by taking into account
questionnaire. Hence, findings will be supported by the researcher using literature review and
graphical presentation.
Reliability and validity: The test or scale will be highly reliable with extent of repeat
measurements undertaken with constant conditions will provide similar outcome. The data will
be valid with success of scale for purpose of measuring that what is set in measures so that
variations in score of individual could be undertaken true variations in feature of this study.
5

Timeline of study
6

REFERENCES
Books and Journals
Das, G., 2014. Impacts of retail brand personality and self-congruity on store loyalty: The
moderating role of gender. Journal of Retailing and Consumer Services. 21(2). 130–
138.
Bijmolt, T. H., and et.al., 2018. Multi-tier loyalty programs to stimulate customer engagement.
In Customer engagement marketing (pp. 119-139). Palgrave Macmillan, Cham.
Cai, R. and Chi, C.G.Q., 2018. The impacts of complaint efforts on customer satisfaction and
loyalty. The Service Industries Journal, pp.1-21.
Hwang, Y. and Mattila, A. S., 2018. Is It My Luck or Loyalty? The Role of Culture on Customer
Preferences for Loyalty Reward Types. Journal of Travel Research. 57(6). pp.769-778.
Kim, D. H. and Jang, S. C., 2014, “Motivational drivers for status consumption: a study of
generation Y consumers”, International Journal of Hospitality Management , Vol. 38
pp. 39-47.
Kotler, P., Bowen, J. T. and Makens, J. C., 2014. Marketing for Hospitality and
Tourism, Pearson Education, Upper Saddle River, NJ.
Marinkovic, V. and et.al., 2013. “The antecedents of satisfaction and revisit intentions for full-
service restaurants”, Marketing Intelligence & Planning. 32(3). pp. 311-327.
ONLINE
Research methodology. 2018. [Online]. Available through
<https://research-methodology.net/research-methodology/rationale-for-the-study/>.
7

8