The Nexus between Customer Relationship Management Strategy and Customer Loyalty in the Star Rated Hotels in Kenya
Ndunda, Ann Muthoni
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Customer relationship management strategies are very essential strategies in current business environment. It is applied in managing the organizations’ associations with its current and target clients. It concentrates on ways of maintaining customer loyalty, thereby assisting in increasing sales. The hotel sector in Kenya has witnessed an increase in the hotel occupancy by 6 percent in 2019, in spite of this the loyal customers have reduced by 30 percent. Offering services to customers with no clear strategy of customer relationship management has contributed to this decline in customers which is expected to affect the hotel market share and profits negatively. It is still a challenge even with the government effort to market and promote the hotels through the Kenya Tourism Board with an aim of attracting more customers locally and abroad. The study aimed to determine the nexus between customer relationship management strategies and customer loyalty of star rated hotels in Kenya. Precisely, the study assessed the influence of customer orientation strategy, institutional strength strategy, service quality management strategy and customer retention strategy on customer loyalty. Resource based view and commitment-trust theory anchored the research. The cross-sectional descriptive research design was adopted for the research. A sample size of 140 head of customer service selected from the target population of 215 star rated hotels in Kenya using multi-stage sampling. A response rate of 91.4 percent was witnessed. Pilot study was conducted on 75 head of customer service of the star rated hotels in Kenya who did not participate in the final study and not part of the sample size. In ensuring reliability, the study used split half and Cronbach’s alpha approach. Among all the independent variables the lowest Cronbach’s alpha coefficient was 0.715 while the highest was 0.939. Descriptive statistics and binary Logistic Regression were used to analyze data and make conclusion. The P value for all the independent variable was less than 5 percent, thus, it is concluded that customer orientation strategy, institutional strength strategy, service quality management strategy and customer retention strategy are statistically significant in prediction of customer loyalty in star rated hotels in Kenya. it was further recommended that; the top-level management need to promote a culture that is customer centered where their staff have more energy directed towards fulfilling the client needs. The star rated hotel customer service department need to conduct regular follow ups on the offered services. It is essential to train and offer seminars sessions to their employees on ways of improving customer loyalty. The star rated hotels should offer a clean and organized platform so as to improve customer loyalty. The hotels need to utilize the price skimming tactic and offer complimentary products so as to retain more customers who will in the long run lead to customer loyalty.