Faculty & Research
Cornell Article Questions Link Between Loyalty Programs and Repeat Business
FOR IMMEDIATE RELEASE
Joe Strodel, Jr., 607-255-4646, js343@cornell.edu
Ithaca, N.Y., August 20, 2004 -- A study published by Cornell University calls into question the widely held belief that guest satisfaction means repeat business. The study, written by Cornell Hotel School Professor Judy Siguaw, was published in the August 2004 issue of the Cornell Hotel and Restaurant Administration Quarterly.
The theory that satisfied guests generate repeat business in the lodging industry was challenged by the results of a study of 364 guests at two similar big-city hotels. Analysis showed only a weak connection between satisfaction and loyalty, which is a precursor to repeat purchases.
Examining such factors as purpose of travel and demographics, the study revealed another finding that may give hoteliers pause, especially considering the industry's huge expenditures on frequent-guest programs. The study found that business travelers were among the least loyal of the guests responding to this survey.
Other findings:
- Chief factors that built guest loyalty were hotel design and amenities.
- The foremost factor in the purchase decision was employee service.
"The implication is that hoteliers might consider redirecting some of their frequent-guest expenditures toward strengthening human resources and improving guest experience through design and amenities," Siguaw observed.
The article can be accessed at: http://www.hotelschool.cornell.edu/research/chr/pubs/quarterly/featured.
Judy Siguaw, D.B.A., is the J. Thomas Clark Professor of Entrepreneurship and Personal Enterprise at Cornell. She was supported in this report by Iselin Skogland, a recent Cornell Hotel School graduate.
Now in its 44th year of publication, the Cornell Hotel and Restaurant Administration Quarterly (CQ) is considered the premier journal of applied research serving hospitality practitioners as well as scholars. The award-winning CQ is published by the School of Hotel Administration's Center for Hospitality Research. Ranked #1 according to the 2001 Management Journal Content Guide for "practical implications in the hospitality and tourism industry," the CQ has also won a coveted Emerald Golden Page Award in 2004 and 2002 in the category of Practical Usability of Research. For more information on the CQ, see: http://www.hotelschool.cornell.edu/research/chr/pubs/quarterly.
About the Center for Hospitality Research
A unit of the Cornell School of Hotel Administration, The Center for Hospitality Research (CHR) sponsors research designed to improve practices in the hospitality industry. Under the lead of the Center's 40 corporate affiliates, experienced scholars work closely with business executives to discover new insights into strategic, managerial and operating practices. The Center also publishes the award-winning hospitality journal, the Cornell Hotel and Restaurant Administration Quarterly. To learn more about CHR and its projects, visit http://www.thecenterforhospitalityresearch.org/.
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