SERVICE INNOVATION AND CUSTOMER CHOICES IN THE HOTEL INDUSTRY NAIROBI CITY COUNTY, KENYA
Patricia K. Mutuku - Masters in Business Administration (Marketing), Kenyatta University, Kenya
Philip Wambua - Lecturer, Business Administration Department, Kenyatta University, Kenya
ABSTRACT
Services have transformed into economies’ driving forces, which has led to focus on new services innovation so as to enhance customer satisfaction. The purpose of this study is to undertake an examination of service innovation’s influence on customer choices in Nairobi City, Kenya’s hotel sector. The specific objectives of the study were: to analyze the influence of product innovation on customer choices in the hotel industry; to explore the influence of technical innovation on customer choices in the hotel industry; to investigate the influence of process innovation on customer choices in the hotel industry; and to evaluate the influence of institutional innovation on customer choices in the hotel industry. For purposes of conducting the study, descriptive research design was used as it is best suited considering the fact that it results in data description, whether in tables, words, or charts. The study focused on hotels 65 out of 129 hotels (refer to appendix II). Four respondents were selected from each of the 65 hotels: The General Manager, the Foods and Beverages manager, Reservations manager and the marketing manager. Collection of field data was aided by semi-structured questionnaires. Data related to the study objectives was analyzed using descriptive statistics, which included measures of variability measures, measures frequency and central tendencies among others. In addition, regression analysis was undertaken to establish the relationships between the independent and dependent variables. The research findings validated all the four service innovation factors examined as being key in influencing customer choices of hotels in Nairobi City County, Kenya. Process innovation however has the most significant influence, followed by institutional innovation. Whereas product innovation is ranked third, the least ranked are technical innovation. The key institutional innovations attributes that influence are customer choices are: when the hotel embraces knowledge sharing capabilities; when the hotel’s organization structure is supportive of new ideas; and when the hotel has unique human resource management styles. Research findings show that the main service innovations implemented in the hotels under study, which influenced customer choices were: hotel location; personal preferences; hotel reputation; characteristics/quality of the hotel products/services; and product offers and services.
