MINISTRY OF EDUCATION AND TRAINING
HONG BANG INTERNATIONAL UNIVERSITY

---------PHAN THANH LONG

FACTORS INFLUENCING LOYALTY OF
CUSTOMERS FOR 4 AND 5 STAR HOTELS
IN HO CHI MINH CITY

Major: Business Administration
Code: 62.34.01.02
Instructor:Assoc. Prof. PhD. Đinh Phi Hổ
PhD Student Phan Thanh Long

Ho Chi Minh City, 2018


The work was completed at:
Hong Bang International University

Instructor:

Assoc. Prof. PhD. Đinh Phi Hổ


Review 1: Assoc. Prof. PhD. Nguyen Quyet Thang
Review 2: Assoc. Prof. PhD. Le Tan Buu
Review 3: Assoc. Prof. PhD. Doan Thi My Hanh

The dissertation will be protected by the thesis review panel at
Hong Bang International University

After joining WTO, the government has determined that tourism is the key economic sector that
needs to be invested in proportion. Reality shows that Vietnam hasa lot of advantages in terms of
tourism potential (many beautiful natural landscapes, long coastline along the country, variety of
national parks are preserved and developed, etc.), besides, Vietnam is also a country with
political economy which are currently being considered significantly stable by the international
community. It is now easily seen thatVietnam has become a focal point for attracting many
domestic and foreign tourists.
In recent years, more and moreVietnamese tourists tend to return back to domestic tourism, the
population of Vietnam is about 90 million people, together with improved living standards, this is
a source of abundant tourists in the tourism industry. Particularly for international visitors, there
have been recently positive changes from the general department to attract the return of visitors.
However, the international and domestic tourism market in the short and medium term has not
tended to be clear, the structure of hotel guests and resort guests is constantly changing.
Vietnamese travelers, as well as international visitors, have also changed somewhat from
previous years. They are more demanding, more interested in values and service, and more
informed about the trends nowadays. As a result, what do hotel managers do to solve this
problem? There are many options to answer this question, but now most hotel managers do not
understand what visitors need and want? As the needs of the visitors have risen to modern living
lifestyle? Therefore, how do visitors continue to use the service at the hotel, managers need to
find out the factors that affect the loyalty of the visitors, in other words, to find out the customers’
need? That is the most important thing for hotel managers. The creation of loyalty will bring
many benefits for tourism units in general and business units in particular.
1.2. OBJECTIVES AND STUDY QUESTIONS
The research objectives are: (i) determine factors influencing the loyalty of customers using 4
and 5-star hotel service in Ho Chi Minh City in a multidimensional approach in the service
quality model; (ii) assessing the impact of customer loyalty factors on the use of 4 and 5-star
hotels in Ho Chi Minh City based on a multidimensional approach in service quality model; (iii),


propose some policy recommendations to increase the loyalty of customers using 4 and 5-star

respondents; (ii) the second interview: 400 respondents.
Information Processing Tool: Data is encrypted and cleaned using SPSS 20.0 software.
Analysis tool: Data are used to evaluate the scale using the Reliability Analysis tool through
Cronbach's Alpha, EFA, CFA and SEM.
1.5. NEW THEMES
On the academic side: (i) the topic identifies factors influencing customer loyalty to the 4 and 5star hotel system in HCMC; (ii), the topic of implementing a service-oriented approach to service
quality in a multidimensional approach (direct and indirect combination) to consider the impact
on customer loyalty Service at 4, 5 star hotels in Ho Chi Minh City. The research results of the
project have demonstrated the loyalty of customers directly affected by customer satisfaction and
04 components of service quality (reliability, responsiveness, tangible means and assurance), and
is indirectly affected by the overall service quality and its five components (reliability,
responsiveness, tangible means, empathy and assurance); (iii), the topic of adjusting the scale of
loyalty, satisfaction, quality of service and its components for 4, 5 star hotel in Ho Chi Minh City
to complement the ladder system measure theory.
Practically: (i), the theme is to help 4, 5 star hotel managers, policymakers identify and measure
the factors that influence customer loyalty. , 5 stars in Ho Chi Minh City; (ii), the topic also
suggests some feasible implications for increasing visitor loyalty, enhancing the competitiveness
of tourism destinations.
1.6. STRUCTURE OF THESIS
The research project consists of 5 chapters presented in the following order: Chapter 1: Overview
of research topics; Chapter 2: Theoretical Foundations and Research Models; Chapter 3:
Research Design; Chapter 4: Research Results; and Chapter 5: Conclusions and Implications for
Research.


CHAPTER 2
THEORETICAL BASIS AND RESEARCH MODEL
2.1. THEORY OF THEORY
2.1.1. Loyalty
Customer loyalty refers to the tendency of a customer to buy and use a brand's product or service

et al., 2005).
Quality of service model
Model of Gronroos (1984): By Gronroos (1984), quality of service is measured by three
components: technical quality, functional quality and image quality.
Model of Parasuraman et al. (1985, 1988, 1991, 1994): Parasuraman et al. (1985, 1988) suggest
that service quality is measured by five components by SERVQUAL: reliability, responsiveness,
assurance, tangible means and empathy. Parasuraman et al. (1991) assert that SERVQUAL is a
complete scale of service quality, value and reliability, and can be applied to all types of service;
In addition, the results of the study by Parasuraman et al. (1991) also showed that the quality of
service, including 05 components and 05 components, had the same effect on quality of service.
In 1994, Parasuraman et al. (1994) argued that service quality was one of the three components
that impacted customer satisfaction along with product quality and price.
Model of Dabholkar et al. (2000): Dabholkar et al. (2000) suggest that service quality is directly
influenced by four factors: reliability, personal attention, benefits, characteristics of products /
services; and quality of service will have an impact on customer satisfaction and hence influence
the intended use of the product.
2.2. OVERVIEW OF RELATED STUDIES
Empirical studies of customer loyalty to the quality of service of local and foreign scientists are
based mainly on the model of Parasuarman et al. (1985, 1988), consisting of five components :
reliability, tangible means, empathy, responsiveness and service (Lawrence and Lucy, 2016;
Nguyen Hue Minh et al., 2015; Mai Ngoc Khuong et al., 2015; Nguyen ThiBich Dao and
Nguyen Huu Tin, 2015; NhamPhong Tuan and Nguyen Thi Hai Linh, 2014; Hoang Sa Dang and
Ying Fang Huang, 2014; Galib, 2013; Kofi et al., 2013; Xiangyu and Jarinto, 2012; Rousan et al.,
2010. ). However, major studies conducted in developed countries differ in their level of
economic and cultural development over Vietnam (Lawrence and Lucy, 2016; Galib, 2013; Kofi
et al. , Xiangyu and Jarinto, 2012; Rousan et al., 2010) or in Da Nang, Hanoi, KienGiang
(Nguyen Hue Minh et al., 2015; NhamPhong Tuan and Nguyen Thi Hai Linh, 2014; Hoang Sa
Dang and Ying Fang Huang, 2014) or the previous time in Ho Chi Minh City (Mai Ngoc Khuong
et al., 2015) also differs from the 4 and 5 star hotels in Ho Chi Minh City. the present time when
the ASEAN Council took effect. In addition, most studies of the impact of service quality on

for the quality of 4 and 5 star hotels is reflected in the fact that the hotel system of 4, 5 stars
always perform what they promise to customers, always support Customer service is always
stable and reliable, always notify customers when the service will be done.
Tangible means: assessed through facilities, equipment and staff (Parasuraman et al., 1988).
Thus, the tangible means of the 4, 5 star hotel system are understood as the facilities, and the
staffs of the hotel are available to meet the expectations of customers as the facilities are packed.
Great, professional and beautiful staff.


Response: assessed through the ability to meet customer needs and provide services quickly
(Parasuraman et al., 1988). Thus, the response of the hotel system 4, 5 stars in the city of Ho Chi
Minh City is reflected by the hotel always support customers when they require a quick and
timely, always support customers when they order.
Assurance: assessed through employee knowledge and courtesy as well as their ability to create
customer confidence (Parasuraman et al., 1988). As such, the assurance of the hotel expresses the
ability of the staff of the hotel through communication and behavior of employees to customers
who have been using the hotel services by answering the Inquiries of customers polite, courteous
should give them peace of mind.
Empathy: assessed through care, customer service (Parasuraman et al., 1988). Thus, the
sympathy of the hotel expressed through the attention, customer care of hotel staff to customers
who have been using the company's services, always understand what the customer. center.
Loyalty
Customer loyalty refers to the tendency of a customer to buy and use a brand's product or service
in a set of competing brands available on the market and repeat this behavior (Chaudhuri &
Holbrook , 2001). Zeithaml& Associates (1996) argue that consumers value the service of a good
company and they tend to promote that company, and more importantly, express their preference
for the company. They are more likely to buy, buy more, and accept higher prices without
moving to other services of the same type that are available on the market, in other words,
quality. Service is considered as the factor to create customer loyalty. As such, customer loyalty
to hotel services is reflected in the attitude and behavior of customers in the continued use of the

(+).
In addition, the results of Parasuraman et al. (1991), Nguyen Van Si and Nguyen Viet Bang
(2017) show that overall service quality is affected by five components: reliability, tangible
means , responsiveness, assurance, and empathy. Thus, the hypothesis H14: The reliability has
the same effect on the quality of service (+); H15: tangible means have the same impact on
quality of service (+); H16: The response has the same effect as the quality of service (+); H17:
Assurances have the same impact on quality of service (+); H18: Empathy has the same impact
on quality of service (+).

Figure 2.5. Model and hypotheses of the author
(Source: author's build)


CHAPTER 3:
RESEARCH DESIGN
3.1 RESEARCH PROCESS
This study combines qualitative research and quantitative research. Qualitative interviews were
conducted through expert interviews and focus group discussions. Next, the author conducted a
preliminary quantitative study by interviewing 100 respondents to adjust the scale. The formal
study was conducted by interviewing 350 respondents to test the model and hypothesis.
3.2. QUALITATIVE RESEARCH
3.2.1. Qualitative research design
Talk about the same pair of experts
Interview method: The interviews were conducted in the form of an exchange between the author
and the experts on the topic: factors affecting the loyalty of customers using the services at the
hotel 4. , 5 stars in the area of HCMC. The entire interview process is recorded on paper.
Data Analysis: Collected data are used to identify factors affecting loyalty; Adjust the observable
variables to measure research concepts.
For group discussion
Interview method: Group discussions were conducted in the form of seminars on the topic:


have

TAN4:

The

facilities

of

the

hotel

meet

the

needs

of

the

hotel.

Reliability: including 05 observations: REL1: The hotel promised to do something specific (like
setting up customer service, after-sales service) then that would be done, REL2: When customers
are in trouble, the hotel will always be solving problems timely, REL3: The hotel services are


responses)

using

a

convenient

sampling

method.

On Data Processing Techniques: Data collected were analyzed by means of reliability analysis,
EFA analysis, CFA analysis and SEM linear modeling.


CHAPTER 4
RESEARCH RESULTS

4.1. RESEARCH SAMPLES
The author conducted a survey of 350 respondents (of which 322 answered correctly). Of the 322
valid responses, 187 respondents used the service at 28 five-star hotels (accounting for 58.1%)
and 135 clients using the service at 47 four-star hotels in Ho Chi Minh City. Accounting for
41.9%; 197 male customers (61.2%), 125 females (28.8%); 85 customers have Vietnamese
nationality (26.4%), 273 foreigners (73.6%).
4.2. RESULTS OF RELIABILITY
The results show that all scales meet the requirements for reliability analysis through the
Cronbach's Alpha coefficient. Specifically: Cronbach's Alpha coefficient of the LO scale is
0.871; SAT is 0.846; OQL is 0.868; REL is 0.866; RES is 0.840; ASS is 0.838; EMP is 0.833;

2006), p - value> 0.05 (Hair et al., 2006).

About the results of testing hypotheses
Hypothesis testing results are accepted. Results of hypothesis testing are presented in Table 4.15.
Table 4.15. Test results hypothesis research

OQL
OQL
OQL
OQL
OQL


TAN
ASS
RES
OQL
SAT
REL
TAN
ASS
RES
EMP

0,290
0,208
0,327
0,206
0,240
0,236
0,021
0,433
0,150
0,167
0,153
0,192
0,079

0,077
0,056
0,062
0,055
0,058

AcceptH7
AcceptH1
AcceptH2
AcceptH4
AcceptH3
RejectionH5
(Survey Results, 2017)

4.6. DISCUSSION RESULTS
Research results show that:
Firstly, customer loyalty is impacted by four components of service quality (reliability,
responsiveness, tangible and secure means) and customer satisfaction with a 5% , 95%
confidence as following:
LO = 0,433 * SAT + 0,15 * REL + 0,167 * TAN + 0,153 * ASS + 0,192 * RES
This means that customers will be loyal to the 4 and 5 star hotels in Ho Chi Minh City when they
are satisfied with the quality of service they trust, appreciate the ability to meet and evaluate
Highly visible means, and highly responsive.
Secondly, customer satisfaction is directly affected by the quality of service and its five
components (reliability, responsiveness, tangible, empathetic and assurance) of 5% , 95%
confidence.
So:
SAT = 0.290 * OQL + 0.208 * EMP + 0.327 * REL + 0.206 * TAN + 0.240 * ASS + 0.236 *
RES
This means: customers will be satisfied when they appreciate the quality of service of 4, 5-star
hotel.


CHAPTER 5
CONCLUSION AND IMPLICATION
5.1. CONCLUSION

hotel system 4, 5-star in Ho Chi Minh City. Therefore, this study should be extended to other
cities such as Hanoi, Da Nang, Can Tho, etc .; (ii) the topic of customer loyalty research in terms
of their evaluation of service quality and satisfaction; (iii) the subject only approached loyalty in
terms of attitudes, which means only considering the intentions of clients but not considering
measures in terms of behavior or angle of association; (iv) Due to the limited time and budget of
the study, the author only interviewed 350 respondents (322 valid responses) who use the service
at the system, 4, 5-star hotel in Ho Chi Minh City is so not enough to be representative for the
research crowds; (v) the topic is limited to verifying the relationship between research concepts
but not yet analyzing the behavior of different target groups in these relationships.