A Critical Literature Review for Hospitality and Tourism industry

Significance, related topics, and issues

Customer satisfaction is defined as the cognitive and affective evaluation, where the standard expectation is compared to the actual perceived performance, which is related to customer experience (Barusman, et al. 2019). Customer satisfaction in the hospitality and tourism sector is defined as the degree to which customers' expectations are met or exceeded by the quality of services provided (Mungai, 2020). According to (Kim et al. 2015), customer satisfaction is regarded as a key antecedent of loyalty. Additionally, customer satisfaction is considered to be the cheapest means of promotion(Pizam, et al. 2016). All these aspects make it an interesting area to explore, with relevance to related topics.

Moreover, Ali et al. (2021) have analyzed customer satisfaction in the tourism industry with various dimensions including service quality, specifically empathy, assurance, responsiveness, and physical/tangible aspects of products and services. Where, all these aspects have a positive correlation with customer experience, and customer satisfaction (Ali et al. 2021).  Furthermore, in research related to the hospitality sector, a meta-research conducted by Ladeira, et al. (2016) has identified 292 types of satisfaction and their possible antecedents and consequences. Where, mostly researchers have analyzed the relationship between expected and actual consumption experiences, which directly influences customer perception and satisfaction levels (Ladeira, et al. 2016; Pizam, et al. 2016).

Moreover, customer satisfaction leads to customer retention. According to (Barusman, et al. 2019), customer retention is defined as a customer’s commitment to a specific company and its offerings through giving repeat purchases and tends to spread a positive word of mouth about the business. Similarly, researchers have defined customer retention as the future tendency of customers to remain loyal to a business (Sari et al. 2018; Magatef, & Tomalieh, 2015). Customer retention is more than mere satisfaction and is mainly dependent on three main factors: service quality, commitment, and satisfaction, as shown in Figure 1:

(Sari et al. 2018).

Like any service industry, there is huge competition in the hospitality business. Consequently, to remain successful, firms need to enhance customer retention. Where, service quality is found to be one of the key factors that help to satisfy the customers and increase their willingness and commitment to repurchase (Sari et al. 2018). In addition to customer satisfaction, retention ensures economic benefits for tourism companies, as customer retention helps to improve business operations and reduce transactional costs, and efficiency (Alshurideh,2016). Still, there is a lack of studies measuring the relationship between service quality, commitment, satisfaction, and customer retention, which shows a gap in the current literature.