Paper Key : IRJ************092
Author: Mohammad Adnan Aburumman
Date Published: 09 Jan 2023
Abstract
RELATIONSHIP MARKETING, COMPANY PERFORMANCE AND CONSUMER RETENTION: EVIDENCE FROM TURKISH HOSPITALITY SECTORAbstractThe purpose of the study was to determine the influence of relationship marketing on company performance with mediating effect of customer retention in Hotel sector of Turkey. Arising from this, the specific objectives of the study were to: i) establish the influence of relationship marketing on company performance, ii) examine the effect of relationship marketing on customer retention, iii) examine the mediating effect of customer retention between the relationship of marketing relationship and company performance. Quantitative research was used to collect data from customers of hotels in Turkey. Total sample size was 230 and SPSS was used for descriptive analysis while PLS-SEM was used to test the hypothesis. The findings of this study shows that relationship marketing has a substantial and significant impact on both the performance of companies and the retention of customers in the hotel sector of Turkey. According to the findings, relationship marketing and customer retention are both key tactics for the hospitality industry. As a consequence, the hospitality sector need to design relationship marketing and customer retention programs that are coupled. According to the findings of the survey, the Turkish hospitality industry seems to be facing a problem with customer defection in the near future since the majority of consumers have stated that they do not want to remain with them for a long time.Keywords: Relationship marketing, trust, communication, saftisfaction, company performance, customer retention1.Introduction 1.1.Background of the studyCustomers are the lifeblood of service businesses, and they need to be nurtured in order to thrive. Marketing in service companies can have a huge impact on how well the company performs as well as how happy consumers are with their experiences with the services they receive (Kotler, & Keller, 2006).It is a service management approach, not a service, to assure the complexity of customer expectations after use and marketing (Gummerus et al., 2017). As Lovelock and Patterson (2015) stated, relationship marketing has been successful in establishing relationships with customers and gaining their trust in order to persuade them to continue utilising the brand and its product offerings. A marketing strategy that utilises the most efficient methods to ensure the acquisition and retention of the most profitable customers. As a result, the enormous growth of the services sector implies the importance of marketing in terms of its broad implications and opportunities, including marketing opportunities brought about by new technology, franchising's ability to take advantage of looser rules and restrictions on professionals, servicing physical goods and global markets (Alon et al., 2020). Because of the rapid rise of the service industry, the business climate has altered. Some believe that client retention is an easy and reliable way to boost productivity (Budianto, 2019). For most firms, the 8020 rule states that 20% of customers account for more than 80% of revenue. However, a smaller percentage of clients can earn as much as 80% to 90% of a company's revenue. This is not uncommon. If a company gives each customer the same amount of resources, this is not a good idea.There has been a lot of discussion about relationship marketing, in both marketing theory and practise. Long-term relationship exchanges between buyers and sellers have been extensively studied in literature rather than focusing solely on one-time sales transactions (Berry et al., 2002; Blattberg & Deighton, 1991; Gummesson, 1994; Hunt & Morgan, 1994; Yau, et al., 2000). It has been stated that if a business adopts a relationship marketing orientation, it would perform better (RMO). Research into RMO's comprehension has just just begun, following the pioneering works of the pioneering RMO researchers (Morgan and Hunt, 1994; and Sin et al., 2006).It is commonly accepted that customer relationship management is best handled via relationship marketing (Morgan & Hunt, 1994). Even while some writers have shown that relationship marketing improves customer retention (Sin et al., 2002; Oly-Ndubisi, 2007; Alrubaiee & Al-Nazer, 2010), others contend that relationship marketing alone may not be sufficient to increase client retention. To provide only two examples, relationship marketing has been argued to be ineffective by Zineldin (2000) and Ryals and Payne (2001). Researchers are trying to figure out whether there are further circumstances in which relationship marketing and customer retention may not be linked (Ranaweera & Prabhu, 2003). Social performance management, for example, may have a significant impact on corporate performance metrics like customer retention (Graves & Waddock, 1997; Husted, 2000; Dahlsrud, 2008). There was a gap in the existing marketing literature about the role of indirect variables in influencing the initial relationship, which has now been filled. For this purpose, the study developed a conceptual model that hypothesized the customer retention in influencing the link between relationship marketing and company performance, and it was hypothesized that the effect of these variables was greater than the individual effect of relationship marketing on customer retention.
DOI LINK : 10.56726/IRJMETS32863 https://www.doi.org/10.56726/IRJMETS32863