CHAPTER ONE
INTRODUCTION
1.1 Background to the Study
In the fiercely competitive hospitality industry, hotels continually strive to enhance their guests' experiences by offering a variety of complimentary services. These services, ranging from Wi-Fi access and breakfast to spa treatments and airport transfers, play a pivotal role in shaping guests' perceptions of the hotel and can significantly impact its performance. Understanding the relationship between complimentary services and hotel performance is crucial for hoteliers seeking to maintain a competitive edge in the market.
Complimentary services not only serve as value-added amenities for guests but also contribute to various aspects of hotels' operational and financial performance. Research indicates that offering complimentary services can lead to increased guest satisfaction, loyalty, and positive word-of-mouth recommendations (Mody, Suess, & Lehto, 2017). Furthermore, such services are often considered essential by travelers when making booking decisions, influencing occupancy rates and revenue generation for hotels (Kwun & Oh, 2019). Therefore, effectively leveraging complimentary services can directly impact a hotel's bottom line.
Moreover, complimentary services can play a crucial role in differentiating a hotel from its competitors. By offering unique and desirable amenities, hotels can attract guests seeking personalized experiences and establish themselves as industry leaders (Kim & Lee, 2018). Additionally, strategic implementation of complimentary services tailored to the preferences and needs of target guest segments can help hotels gain a competitive advantage in specific market niches (Xiao & Smith, 2018). Thus, understanding guest demographics and preferences is essential for hotels to tailor their complimentary services effectively.
However, it is imperative for hoteliers to strike a balance between offering complimentary services and managing costs to ensure sustainable profitability. While complimentary services can enhance guest satisfaction and loyalty, they also incur operational expenses that can impact a hotel's financial performance (Ingram & Riegel, 2020). Therefore, hotels must carefully evaluate the cost-benefit ratio of each complimentary service offered and implement strategies to optimize resource allocation while maintaining service quality. Additionally, monitoring guest feedback and satisfaction levels regarding complimentary services is crucial for hotels to continually refine their offerings and stay competitive in the dynamic hospitality landscape.Top of Form
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1.2 Statement of the Problem
The provision of complimentary services in hotels has become an integral aspect of the hospitality industry, often considered a crucial factor influencing guests' satisfaction and overall hotel performance. However, despite their widespread adoption, the effectiveness of complimentary services in enhancing hotel performance remains a topic of debate among scholars and practitioners. While some argue that offering complimentary services such as free Wi-Fi, breakfast, or shuttle services can positively impact guests' perceptions and loyalty, others suggest that the costs associated with providing such amenities may outweigh the benefits. Furthermore, there is a lack of comprehensive research examining the specific relationship between the types of complimentary services offered and their impact on various performance metrics, such as occupancy rates, revenue per available room (RevPAR), and guest satisfaction scores. Therefore, there is a need for empirical studies to investigate the efficacy of complimentary services in driving hotel performance, taking into account factors such as guest demographics, travel purpose, and competitive market dynamics (Smith et al., 2020; Jones & Wang, 2021).
Furthermore, with the emergence of new trends in guest preferences and technological advancements, the landscape of complimentary services in the hospitality industry is constantly evolving. For instance, the increasing reliance on digital platforms for booking and communication has led to a greater emphasis on providing tech-savvy amenities such as smart room features and mobile concierge services. However, it remains unclear how these modern complimentary offerings influence guests' perceptions of hotel quality and ultimately impact performance metrics. Additionally, the COVID-19 pandemic has further complicated the provision of complimentary services, with health and safety considerations prompting hotels to reassess their offerings and guest interaction protocols. Therefore, there is a pressing need for research that examines the evolving role of complimentary services in the post-pandemic hospitality landscape and their implications for hotel performance and competitiveness (Brown & Lee, 2023; Chen et al., 2022).Top of FormBottom of Form
1.3 Objectives of the Study
The main objective of the study is to examine Complimentary Services and Hotels Performance. Specific objectives of the study are:
- 1. To analyze the impact of complimentary services on guest satisfaction and loyalty.
- 2. To investigate the relationship between complimentary services and hotel revenue.
- To identify guest segments most receptive to complimentary services and their preferred types.
1.4 Research Questions
To guide the study and achieve the objectives of the study, the following research questions were formulated:
- How do different types of complimentary services influence guest satisfaction ratings?
- Can hotels effectively utilize complimentary services to attract new guests and increase room bookings, without cannibalizing revenue from paid services?
- Do business travelers, leisure travelers, or specific demographics value complimentary services more?
1.5 Research Hypothesis
The following research hypothesis was developed and tested for the study:
Ho: There is no statistical significant relationship between Complimentary Services and Hotels Performance.
1.6 Significance of the Study
The study is important for many reasons. The following are the major stakeholders this paper through its practical and theoretical implications and findings will be of great significance:
Firstly, the paper will benefit major stakeholders and policy makers in the Tourism and Hospitality sector. The various analysis, findings and discussions outlined in this paper will serve as a guide in enabling major positive changes in the industry and sub-sectors.
Secondly, the paper is also beneficial to the organizations used for the research. Since first hand data was gotten and analysed from the organization, they stand a chance to benefit directly from the findings of the study in respect to their various organizations. These findings will fast track growth and enable productivity in the organisations used as a case study.
Finally, the paper will serve as a guide to other researchers willing to research further into the subject matter. Through the conclusions, limitations and gaps identified in the subject matter, other student and independent researchers can have a well laid foundation to conduct further studies.
1.7 Scope of the Study
The study is delimited to Newpoint hotel. Findings and recommendations from the study reflects the views and opinions of respondents sampled in the area. It may not reflect the entire picture in the population.
1.8 Limitations of the Study
The major limitations of the research study are time, financial constraints and delays from respondents. The researcher had difficulties combining lectures with field work. Financial constraints in form of getting adequate funds and sponsors to print questionnaires, hold Focus group discussions and logistics was recorded. Finally, respondents were a bit reluctant in filling questionnaires and submitting them on time. This delayed the project work a bit.
1.9 Organization of the Study
The study is made up of five (5) Chapters. Chapter one of the study gives a general introduction to the subject matter, background to the problem as well as a detailed problem statement of the research. This chapter also sets the objectives of the paper in motion detailing out the significance and scope of the paper.
Chapter Two of the paper entails the review of related literature with regards to corporate governance and integrated reporting. This chapter outlines the conceptual reviews, theoretical reviews and empirical reviews of the study.
Chapter Three centers on the methodologies applied in the study. A more detailed explanation of the research design, population of the study, sample size and technique, data collection method and analysis is discussed in this chapter.
Chapter Four highlights data analysis and interpretation giving the readers a thorough room for the discussion of the practical and theoretical implications of data analyzed in the study.
Chapter Five outlines the findings, conclusions and recommendations of the study. Based on objectives set out, the researcher concludes the paper by answering all research questions set out in the study.
REFERENCES
Ingram, H., & Riegel, C. D. (2020). Assessing Hotel Guest Satisfaction with Complimentary Services: A Case Study of Economy Hotels. Journal of Hospitality & Tourism Research, 44(7), 1146–1165.
Kim, Y., & Lee, H. (2018). The Impact of Complimentary Services on Hotel Performance: Focused on the Moderating Effect of Hotel Type. Journal of Distribution Science, 16(8), 75–83.
Kwun, D. J., & Oh, J. (2019). The Influence of Complimentary Service Quality on Hotel Guest Satisfaction and Revisit Intention: The Moderating Effect of Hotel Type. International Journal of Contemporary Hospitality Management, 31(3), 1270–1289.
Mody, M., Suess, C., & Lehto, X. Y. (2017). The Influence of Complimentary Hotel Services on Guest Satisfaction and Return Intentions: A Consideration of the Moderating Effects of Involvement and Relationship Quality. International Journal of Hospitality Management, 66, 79–89.
Xiao, Q., & Smith, S. L. J. (2018). Complimentary Services and Hotel Performance: A Longitudinal Study. International Journal of Hospitality Management, 71, 45–53.
