Managing customer hedonism: a case of luxury hotels.

• Date: 22 September 2012
• Author: Lim, Weng Marc

1. INTRODUCTION

   Competition among luxury hotels to manage and satisfy customers' needs has become increasingly intense due to the proliferation of the service industry. Marketing strategies that focuses on utilitarian needs may no longer provide a competitive advantage and thus, new avenues to increase customer satisfaction and re-patronage are required. Customer hedonism, which focuses on the maximization of pleasure, has received considerable amount of attention in the recent literature, and calls for further investigation on its predictors and effects on consumer behavior has been strongly encouraged (Crick and Spencer, 2011). In particular, the understanding of how hotel patrons benchmark and evaluate hotel attributes that facilitates hedonism is crucial for the management of luxury hotels as customers in contemporary times are increasingly seen to make behavioral decisions based on their emotions, but unfortunately, remains in the dark (Choi and Chu, 2001). Accordingly, this research attempts to shed some light on this infertile area of research by investigating for hotel attributes that creates customer hedonism in luxury hotels and examines the significance of engaging into marketing strategies focusing on customer hedonism on customer satisfaction and the latter's influence on customer re-patronage behavior. The contributions of this study is two-fold: (i) to theory - an understanding on hotel attributes that creates customer hedonism in luxury hotels and the influence of customer hedonism on customer satisfaction and the influence of customer satisfaction of re-patronage behavior; and (ii) to practice--to enable luxury hotel marketing managers to make better inform decisions and help convince their target market on why their hotels should be the recipient of those customer dollars.

2. LITERATURE REVIEW

   2.1 Service Quality

   Service quality has been defined as how well a customer's needs are met and how well the service delivered meets the customer's expectation (Su, 2004). Prior research has shown the significant relationship between service quality and customer hedonism (Choi and Chu, 2001). Its importance was echoed by Wong et al. (1999) as service quality aspects, such as friendliness, helpfulness and politeness, goes a long way to create gratification of being happy in customers as customers enjoy being treated with respect and being pampered. This suggests that good service quality which pampers its customers, especially in luxury hotels, creates a pleasurable feeling among customers, typically those which makes customers feel warm, special, and welcomed (Crick and Spencer, 2011). These findings are in line with those of Ladhari (2009) that service quality attributes has a significant impact on consumers affective component, which may lead to emotional satisfaction, such those which creates a sense of happiness, pleasure and enjoyment, in other words, hedonism. Thus:

   H1: Service quality will have a positive influence on customer hedonism

   2.2 Servicescape

   Servicescape embodies the built environment in which the service is delivered and where the firm and the customer interact with the environment (Keilor et al., 2004). Walls et al. (2011) suggest that customers rely on the servicescape from which they form their hedonistic experiences. Thapa (2007) added that servicescape creates hedonism as service environments activate emotional process in regards with consumption and create an image in consumer minds that influences their affect or emotions. Cognitive pleasure results from activating cognitive processes, including those involved in experiential aspects of consumption, such as mental play, amusement or fantasy, in which servicescape builds customers' hedonistic experiences through interaction with the environment as customers are highly involved with the environment created for them, which connects at an emotional level through consumer experience (Walls et al., 2011). These notions are supported by Gueguen and Petr (2006) as atmospheric environments that provide good impression to customers creates greater hedonistic experiences. Hence:

   H2: Servicescape positively influence customer hedonism.

   2.3 Thrift

   At its essence, thrift is about the best, most efficient use of limited resources. It is a consumption behavior that has been increasingly made a key consideration, from which consumers may receive hedonic value through bargain perceptions (Babin et al., 1994). The phenomenon of thrift in the luxury market can be explained by the "massclusivity" of luxury (Koval, 2005), whereby in today's market, luxury goods are no longer purchased by affluent consumers but also by aspiring middle income consumers who have found luxury consumption more accessible and affordable than never before. Recent times of economic recession have further accelerated their inclination towards bargain shopping making discretionary thrift acceptable and even fashionable (Flatters and Willmott, 2009). Unsurprisingly, affluent customers , who are widely regarded as the main patrons of luxury hotels, are also found to be economizing and buying at bargain pricing, for which Bardhi (2005) affirms that that the pursuit and experience of luxury emerges along side with the experience of thrift. By seeing the bargaining process as competition to be "won" between themselves and the sellers (Morris,1987), Danziger (2005) posits that getting a bargain is a way for luxury consumers to measure their wining in the shopping game. Price savings made by bargainhunting luxury buyers, induces feelings of pride, intelligence, and a sense of achievement and grants the individual the experience of pleasure and enjoyment from the overall value gained (To et al., 2007), thus offering as a source of emotional satisfaction that can result in hedonic responses associated with that of a smart shopper. Therefore:

   H3: Thrift has positive influence on customer hedonism.

   2.4 Personalization

   Personalization is the capability to deliver information or services to an individual or a group of individuals based on an understanding of their needs, habits, lifestyle, preference, likes and dislikes (Kim, 2002). The work of Kim (2002) suggests that personalization is often tailored to a group of individual customers rather than to the entire population of...