A new study from a Tippie College of Business researcher suggests that building customer loyalty takes more than customer satisfaction.
The study found that even when a customer gives high marks to a business for satisfaction, that doesn’t guarantee their loyalty to the brand.
What does build loyalty? Rin Yoon, professor of marketing, said that personalization is key, especially in hyper-competitive industries like hotels, where satisfaction is already high and firms are looking for any edge they can get.
The study found that when hotel guests could personalize their room, they were more likely to come back for future visits.
Why? Yoon said personalization gives guests a sense of psychological ownership and they are more likely to not only return but to recommend the hotel and engage with its social media sites. In one study, the researchers analyzed more than 14,000 online reviews of a popular hotel in Hawaii and found guests who referred to “my room” or “our room” tended to write longer reviews and put more effort into them.
Another experiment at another hotel showed guests who were randomly given the chance to choose their room said they felt more ownership and reported stronger loyalty to the hotel. Housekeeping staff also said they left their rooms cleaner, suggesting they cared more.
Yoon said that in most cases, customers reported a high rate of satisfaction whether or not they felt a sense of ownership. That meant that personalization is the main driver of building brand loyalty.
What can hotels do to increase psychological ownership? She said they can ask guests at check-in what kind of lighting they would like in their room, or what types of pillows they want on the bed. The study found these are relatively easy and inexpensive ways to build brand loyalty, far less expensive and easier to offer than upgrades to service, amenities, or rooms.
Yoon’s study was published in the journal Cornell Hospitality Quarterly.
Media contact: Tom Snee, 319-384-0010 (o); 319-541-8434 (c); tom-snee@uiowa.edu