MINISTRY OF EDUCATION AND TRAINING ACKNOWLEDGEMENTS UNIVERSITY OF ECONOMICS - HOCHIMINH CITY I would like to express my appreciation to Dr. Tran Ha Minh Quan for his motivation, support. This thesis would not be completed without his support, enthusiasm. He transferred professional knowledge of research methodology to me has improved my research skills and provided useful guidance throughout my academic career.
I greatly appreciate to the board of managers in Van Thanh Tourist Village, Tan NGUYỄN MINH HẬU Cang Tourist Village who allowed me to conduct the survey at these restaurants. I would like to thank the customers at the restaurants of the Tourist Village in Ho ChiTHE IMPACT Minh City OF CUSTOMER for their participation SATISFACTION, of effective data collection. SERVICE QUALITY AND BRAND IMAGE ON CUSTOMER LOYALTY I greatly thanks to Mr. Nguyen Van Cuong, who spent hours with me for the interview.
TOWARDS THE RESTAURANTS OF THE Lastly,TOURIST I offer my regardsVILLAGE IN to all of those who HO CHI supported MINH me during CITY the research. Ho Chi Minh, Viet Nam MASTER’S THESIS April, 11th, 2012 Nguyen Minh Hau 1 Ho Chi Minh City -2012 TIEU LUAN MOI download : skknchat@gmail.com MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS - HOCHIMINH CITY NGUYỄN MINH HẬU THE IMPACT OF CUSTOMER SATISFACTION, SERVICE QUALITY AND BRAND IMAGE ON CUSTOMER LOYALTY TOWARDS THE RESTAURANTS OF THE TOURIST VILLAGE IN HO CHI MINH CITY MASTER’S THESIS MASTER IN BUSINESS ADMINISTRATION Ology Code: 60. TRẦN HÀ MINH QUÂN Ho Chi Minh City -2012 2 TIEU LUAN MOI download : skknchat@gmail.com ABSTRACT Nowadays, together with the social economic improvement, the living standard is increasing and having lots of restaurants operating in Ho Chi Minh City. To satisfy the customers’ needs, restaurants try to improve their quality of service and find out the better ways to attract more customers.
But it seems to be inefficient to keep old customers and attract new customers. Why does inefficient state happen and last for a long time in restaurant industry? The researchers pay attention to find the reason for the problem and discover the main factors influencing to customer loyalty in restaurant industry. On the other hand, one of the interesting tourist types is the Tourist Village. It exists as the resort or the simpler type: restaurant.
If resorts mainly exist in the provinces, restaurants of the tourist village popularly exist in Ho Chi Minh city. The restaurants of the tourist village possess some advantageous points compare to the normal restaurants, such as: having a large square, can connect luxurious structure of the restaurant to the use of air, atmosphere and tree building. But even though, possessing these advantages, the number of customers come to the restaurants of the tourist village have also decreased. Whether may It be influenced by the common rules which have affected to restaurant industry or having another factors aiming at the tourist village not? This is a practical question and to supply a correct answer requires a research to show full of theoretical side, practical side.
This thesis was conducted aiming at solving these problems and used interview. A main survey was undertaken with a sample of 205 customers in two sites: The restaurant of Van Thanh Tourist Village, The restaurant of Tan Cang Tourist Village. The results reveal that customer satisfaction, the components of service quality and the brand image of the restaurant have positive impact of customer loyalty. 3 TIEU LUAN MOI download : skknchat@gmail.com Based on the findings, it is recommended that the restaurants of the tourist village in Ho Chi Minh city should consider the long term strategy as well as increasing marketing program.
Key words: Customer loyalty, customer satisfaction, the brand image of the restaurant. 4 TIEU LUAN MOI download : skknchat@gmail.com TABLE OF CONTENTS Acknowledgements. II Table of contents .III CHAPTER I: INTRODUCTION 1.3 Research questions & objectives .5 Research methodology and research design .6 Significance of the research .6 CHAPTER 2: LITERATURE REVIEW & THEORETICAL MODEL 2.2 Review of previous articles and theses on customer loyalty .3 Service quality concept .4 Customer satisfaction concept .5 The brand image concept .6 Impact of service quality, customer satisfaction, restaurant image on customer loyalty .7 Factors contributing to customer loyalty .8 The conceptual framework .9 Theoretical model and hypotheses .30 CHAPTER 3: RESEARCH METHODOLOGY 3.34 5 TIEU LUAN MOI download : skknchat@gmail.5 Data analysis method .39 CHAPTER 4: DATA ANALYSIS AND RESULTS 4.1 Descriptive data analysis .4 The regression model .5 Interpretation and Discussion.45 CHAPTER 5: CONCLUSION & IMPLICATIONS 5.61 List of tables .72 6 TIEU LUAN MOI download : skknchat@gmail.com CHAPTER I: INTRODUCTION 1.1 Research background When Viet Nam joint WTO in 2007, Viet Nam became a central point for tourist visiting because of its natural atmosphere and beautiful sight as well as characteristic cuisines. To attract tourist around the world, hotel and restaurant industries play an important role on bringing value to customers.
If hotel supplies values related to destination for tourist visiting, restaurant sends characteristic cuisines for tourist. As a result, hotel industry has a close relationship to restaurant industry because they aim at one objective as tourist. Take this rules, lots of resorts had opened to supply both of hotel and restaurant services. Normally, resorts set up at places where are near to beach and resorts focus on tourist who has the demand on enjoying beautiful landscape and natural atmosphere.
Restaurant seems to be one of a small part of resorts to serve customer about cuisine, and hotel plays a central point to make profit for resort because travelers tend to book room on hotel over night during several days. But in Ho Chi Minh City, resorts have individual characteristic where restaurant services also play dominant role not less than hotel services. The reason is due to the demands of customers.1, the number of respondent who visit to Ho Chi Minh city by attractive side is 43% and is smaller than the respondent who visit to other province. As a place in which have many small rivers and lack of mountain or beach, Ho Chi Minh City has not a dominant point about beautiful sight compare to many provinces in which have beach or mountain but Ho Chi Minh city can be thought as a place where tourist can enjoy delicious Vietnamese food and cuisines from around the globe, including French, Indian, Mexican, Italian, Japanese, Thai and Chinese.
For this reason, tourist village in Ho Chi Minh city had grown and can be seen as a type of resorts.2, the number of respondent who visit to the tourist village by attractive side is 36%. This is a small 7 TIEU LUAN MOI download : skknchat@gmail.com percentage comparing to the respondent of who visit to star hotel and it implies that tourist village has not attractive landscape for visitors.3, the structure of average expenditure out of tour for foreign visitors in the tourist village shows that expenditure to food is 48.3% as the highest value compared to the expenditure to food of other accommodations. This means that in tourist village, restaurant which supplies food and beverage play an important source of profit compared to other hotels which have restaurant component. Although tourist village mainly focus on cuisine services which create a large percentage of its profit but tourist can enjoy more values in here rather than normal restaurant.
Tourist village include restaurant which possesses a large square and hotel as well as yacht service, fish hunting service. Because of its sophisticated structure, all of its service values have an impact on customer visiting but restaurant service play a central point to attract customer. Although, restaurant is a part of supply chain of tourist village, but restaurant also compete strongly with other restaurant. Especially, there are lots of restaurant in Ho Chi Minh city which provide cuisines service not only Vietnamese characteristic but also Asian or Europe characteristic.
To survive in this competition, restaurant on tourist village should reposition its value on two dimensions: The first, the restaurant manager should define customer demands. Understanding customer demands as well as analyzing factors influencing to customer loyalty is a key to make restaurant’s success. The second, the restaurant manger should define restaurant strength and character in a relationship with other services of Tourist village. Defining their character is very important and it requires define their brand image on customer perception.
There have been many studies on customer loyalty in restaurant industry to clarify what factors influence in loyalty as well as to supply information for restaurant manager making their solution. Previous research on customer loyalty focuses on what main impact on loyalty in restaurant industry. Cevded Avcikurt and Murat Dogdubay (2008) studied the determinants of customer loyalty by emphasizing on 8 TIEU LUAN MOI download : skknchat@gmail.com the importance of food, service quality, ambiance, convenience. Rasha Alli Eliwa (1993) focused on the image of restaurant to customer loyalty.
Beside, there has been study on customer loyalty in the tourist village of Viet Nam country. Nguyen Thi Tuyet Loan (2011) studied the impact of service quality, customer satisfaction on customer loyalty in the tourist village of Da Lat province. This study had also pointed out that some factors have influence in customer loyalty in the tourist village, including price, service quality and customer satisfaction. So far there has been no research on customer loyalty in restaurant of the tourist village.
To approach the tourist village, determinants of customer loyalty in restaurant can be different from the result of previous research because of its characteristic. It is also necessary to research on customer loyalty in restaurant on the tourist village in Ho Chi Minh city so as to out line marketing strategies, increase the profit of restaurant and so far create the compared advantages of the tourist village.2 Problem definition In table 1.4, the number of tourist foreigner respondent who decide to visit Vietnam by friends, relations in the tourist village is 18.2% and is smaller than other accommodations. This means that the impression of visitors to the tourist village is not high and they are not willing to introduce to their relations or friends. It is a signal to consider about the customer loyalty forwards to the tourist village as well as to the restaurant of the tourist village.5, the number of tourist foreigner respondent on best impression forwards to the tourist village is 30.3 percent for landscape, and 30.3 percent for cheap commodities.
The percentage of respondent to landscape of the tourist village is smaller than other accommodations so it can be considered that landscape is not an advantage side of tourist village. On the other hand, cheap value makes strong impression for visitor forwards to the tourist village compared 9 TIEU LUAN MOI download : skknchat@gmail.com to other accommodations. So, beautiful side or cheap value is whether a factor influencing to customer loyalty in the restaurant of the tourist village or not? On the other hand, in restaurant industry, a competition always exists and directly influences in lots of activities of restaurant. Facing to competition, the restaurant of the tourist village in Ho Chi Minh city is not outside from this rule.
In the restaurant of Tan Cang tourist village, the restaurant managers try to reduce price of buffet and set menu to attract customer. On the other hand, in the restaurant of Van Thanh tourist village, the restaurant managers improve the effectiveness of green areas policy to provide clean value for customers. But following to the internal statistic source of Tan Cang, Van Thanh tourist village (Table 1.6), during the time of price reducing and green areas policy taken, the total of revenue of restaurant decreased slightly because of the amount of customer reducing. So, what are factors which influence in customer loyalty in the restaurant of the tourist village in Ho Chi Minh city? Another problem is that on the tourist village, restaurant is a part and when managers need an investment, they face financial pressure.