FIRM  LEVEL COMMUNICATION AND CUSTOMER PERCEPTION OF SERVICE QUALITY IN THE HOTEL INDUSTRY IN GHANA
BY 
MOHAMMED MAHAMA BRAIMAH
A THESIS SUBMITTED TO THE UNIVERSITY OF GHANA, LEGON, IN PARTIAL FULFILMENT FOR THE REQUIREMENT FOR THE AWARD OF MBA DEGREE IN MARKETING
JUNE 2002
t k ^U'S i
DECLARATION
I hereby declare that, apart from references to other people’s work which has been 
duly acknowledged, this thesis is the result of my own research work done under 
supervision, and has never been presented either in whole or in part for any degree in 
this University or elsewhere.
SUPERVISOR 
Dr. S.N. Buatsi
STUDENT
Mohammed Mahama Braimah
SUPERVISOR
Dr. S.C.K Buame
DEDICATION
I dedicate this piece of work to my sweet wife Janet, and to my lively and lovely son, 
Danen. I also dedicate this work to my loving and caring mother Hawa, and to the 
everlasting memory of my late father Braimah Soznorr.
I wish to thank the Lord God Almighty for his abundant grace that has given me 
health, strength and ability to go through this study.
My appreciation goes to my supervisors Dr. Buatsi and Dr. Buame for their insightful 
and intelligent comments and contributions that has undoubtedly enriched my work 
and increased my own understanding and experience. This study would not have 
been possible without their assistance.
I also thank the various lecturers of the School of Administration who imparted 
knowledge to me during the course of my study programme in the University of 
Ghana. Again, I wish to thank my employers, Masai Developers Ltd., for granting me 
the opportunity to undertake this programme.
My thanks also go to my secretary, Rosebud, who assisted in typing and printing this 
document. I also appreciate the efforts of Alberta, Esther and Sylvia who assisted me 
to administer the questionnaires. My thanks again go to my family, who had to put 
up with my absence from home for long hours without complains. And to Uncle 
Peter, Prince, Sammy, Shamir and Sam, I say thank you for your encouragement, 
support and assistance.
Finally, I wish to thank my dear wife Janet, for the support and encouragement she 
gave me through out the programme. Janet, this would not have been possible 
without your support. May the good Lord richly bless you.
ACKNOWLEDGEMENTS
The world has become a global village and more and more firms are now competing 
for the attention and action of the same customer. This exposes the customer to 
hundreds of promotions a day. To survive and grow in this hostile business 
environment, firms attempt to capture the attention of potential customers through 
their marketing communication efforts. Service firms use a variety of promotional 
tools including servicescapes to reach potential consumers. As a result of the variety 
of promotional tools being used and the sheer volume of information being sent out, it 
becomes difficult for service firms to effectively integrate and coordinate these 
messages. This results in conflicting images and promises. Sometimes, they (Service 
Firms) over promise or exaggerate their services to win customers. The study was 
therefore designed to determine how firm level communication influence service 
quality perceptions, and the impact that inconsistencies between firm level 
communication and service delivery have on service quality perceptions. In a survey, 
three sets of questionnaires were designed and administered on a sample of 
customers, management and front line staff of various hotels in Accra. It was 
established in the study that customer perception of service quality is shaped to a large 
extent by customer expectations, which itself is influenced by firm level 
communication. Several hotels are making conscious efforts to integrate and 
coordinate all aspects of their firm level communication ensuring that their messages 
are both believable and deliverable. Service encounter emerged as the most important 
factor that influenced customer perception of service quality in a given service 
experience. Given the increasingly hostile nature of the business environment, the 
importance of service quality as a means of differentiating one service firm from 
another cannot be over emphasized. However, because service quality perception is a 
subjective cognitive activity, influenced by firm level communication and customer 
expectations, it is important that firms integrate and coordinate their promotional 
efforts and make only claims and promises that they can adequately fulfill.
ITEM
TABLE OF CONTENTS
PAGES
Declaration...............................................................................................................ii
Dedication...............................................................................................................iii
Acknowledgement.................................................................................................. iv
Abstract....................................................................................................................v
Table of Contents................................................................................................... vi
List of Tables............................................................................................................v
Table of Figure....................................................................................................... vi
CHAPTER ONE1.0 Introduction.................................................................................................... 1
1.1 Background.................................................................................................... 1
1.2 The Problem statement..................................................................................7
1.3 Purpose of the study...................................................................................... 8
1.4 Objectives of the study..................................................................................9
1.5 Significance of the study..............................................................................9
1.6 Research questions...................................................................................... 10
1.7 Organization of the study............................................................................10
1.8 Operational definitions. ............................................................................. 121.9 References....................................................................................................14
CHAPTER TWO
2.0 Overview of the hotel industry...................................................................15
2.1 Introduction..................................................................................................15
2.1.1 Structure of the chapter............................................................................... 16
2.2 The Scale of Global Hotel Industry........................................................... 16
2.3 Industry performance in the late 80’s and the 90’s................................... 18
2.4 Variables influencing the future of the hotel industry.............................. 21
2.5 Issues of strategic importance to the industry........................................... 23
2.6 The impact of the September 11, 2001 tragedy......................................... 26
2.7 The structure of the hotel industry in Ghana............................................. 28
2.7.1 Current hotel supply.................................................................................... 30
2.7.2 Projected hotel supply.................................................................................32
2.8 References....................................................................................................34
i r e e
3.0 Theoretical background............................................................................ 35
3.1 Conceptual Framework.............................................................................35
3.2 What is service quality..............................................................................37
3.2.1 Classification of quality definitions.........................................................38
3.2.2 Types of service quality............................................................................40
3.2.3 Measuring service quality........................................................................ 42
3.3 Customer Perception.................................................................................46
3.3.1 Perception defined.....................................................................................47
3.3.2 Selective Perception..................................................................................48
3.4 Customer expectations..............................................................................50
3.4.1 Foundations of customer expectations.....................................................52
3.4.2 Uncontrollable factors influencing customer expectations....................52
3.4.3 Controllable factors influencing customer expectations........................ 54
3.5 Marketing communication........................................................................54
3.6 The communication process......................................................................57
3.6.1 Elements of the communication process..................................................59
3.6.2 The response process.................................................................................60
3.6.3 Alternative response hierarchy................................................................. 62
3.6.4 Cognitive processing of information........................................................64
3.7 Marketing communication variables........................................................66
3.7.1 External marketing communication variables......................................... 67
3.7.2 Interactive Marketing Variables............................................................... 76
3.7.3 Internal Marketing Variables.....................................................................82
3.8 Conclusion.................................................................................................. 83
3.9 References...................................................................................................86
CHAPTER FOUR
4.0 Methodology..............................................................................................88
4.1 Sampling design.........................................................................................88
4.2 Research design........................................................................................ 89
4.3 Data collection...........................................................................................90
4.4 Data analysis.............................................................................................91
4.5 Limitations of the study...........................................................................92
4.6 References.................................................................................................93
CHAPTER FIVE
5.0 Presentation and analysis of D ata ........................................................... 94
5.1 Introduction...............................................................................................94
" ' ‘ luence of firm level communication on customer
expectation...........................................................................................................96
5.4 The effect of expectation on customer perception of
service quality..................................................................................................... 97
5.5 The interaction of firm level communication and its
Influence on customer perception of service quality.......................................100
5.5.1 Integrating firm level communication...............................................................101
5.5.2 Co-ordinating internal marketing...................................................................... 102
5.6 Over promising the service of a firm and its impact on
service quality perceptions.................................... ..........................................1055.7 The most critical factor that influences customer perception of
Service quality in a service encounter..............................................................106
5.8 Summary.............................................................................................................108
5.9 Reference..............................................................................................................I l l
CHAPTER SIX
6.0 Conclusion and recommendation...................................................................... 112
6.1 Conclusion .............................................................................................. 112
6.2 Recommendation for management of service firm s....................................... 114
6.3 Recommendation for future research studies...................................................115
6.4 Reference.............................................................................................................116
BIBLIOGRAPHY.........................................................................................................117
WEB-BLIOGRAPHY.................................................................................................. 118
APPENDIXAppendix 1: Questionnaire for front line staff..........................................................120
Appendix 2: Questionnaire for executive management........................................... 124
Appendix 3: Questionnaire for customers................................................................. 129
LIST OF TABLES
Table 1.1 Growth rate of various sectors of the Ghanaian economy......................2
Table 2.1 National distribution of licensed hotels (2000)....................................31
Table 2.2 Distribution of hotel rooms (2000)....................................................... 31
Table 2.3 Summary of ratings for hotels and room supply -  2000 .......................32
Table 3.2 Correspondence between the ten original quality dimensions
and SERVQUAL dimensions............................................................... 45
Table 5.1 Composition of hotels interviewed....................................................... 95
Table 5.2 Response rate to questionnaires.............................................................95
Table 5.3 The levels of expectation........................................................................96
Table 5.4 Factors influencing customer expectation............................................ 97
Table 5.5 Service quality dimensions and customer perceptions........................ 98
Table 5.6 Degrees of service quality..................................................................... 100
Table 5.7 Co-ordinating internal marketing..........................................................102
Table 5.8 Customer complains...............................................................................104
Table 5.9 Comparing the promise and the actual experience of
selected variables..................................................................................106
TABLE OF FIGURES
Figure 2.1 Structure of the hotel industry in Ghana............................................30
Figure 3.1 Perceived service quality.....................................................................40
Figure 3.2 Zone of tolerance................................................................................. 51
Figure 3.3 Wilbur Schram’s model of communication process.........................58
Figure 3.4 Lasswell’s 5 -  Ws model of communication...................................59
Figure 3.5 Models of the response process.......................................................... 61
Figure 3.6 Alternative response model................................................................ 63
Figure 3.7 Cognitive response approach............................................................. 65
Figure 3.8 Reaching the service customer........................................................... 66
Figure 3.9 Marketing communications variables................................................67
Figure 3.10 Linkages between the key dimensions...............................................84
Figure 5.1 Most important factor influencing service quality
perception.......................................................................................... 107
Figure 5.2 Levels of service quality - absolute responses................................109
Figure 5.3 Levels of service quality -  Percentage responses............................110
x
CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND
Service forms a significant component of the Gross Domestic Product (GDP) of several 
Countries in the world today. For example, according to the South African Reserve 
Bank, in 1995 services (Transport and communication, private and government services, 
finance, utilities and trade) contributed 59% to GDP. In the Philippines, services 
contributed about 45% to GDP according to the National Statistical Co-ordination Board, 
and in Hong Kong, services contributed about 84% to GDP in 1996.
Dahringer and Muhlbacher (1991) contend that service accounts for between 20 to 30 
percent of world trade, with an estimated growth rate of about 20 percent per year. This 
illustrates the growing importance of the service sector to the economies of various 
nations.
In Ghana, the service sector is the fastest growing sector as demonstrated in Table 1.1 
below.
1
Table 1.1 Growth rate of various sectors of the Ghanaian economy
2000 2001
Services 5.4% 5.1%Agriculture 2.1% 4.0%Industry 3.8% 2.9%
Source: Adapted from Ghana Government Financial Policy and Budget Statement- 2002
The increased significance of the service sector to the global economy has led to a 
heightened concern by practitioners as well as consumers regarding the quality of service 
being offered. Not surprisingly, the concept of quality and its relationship with the 
service industries has become a major pre-occupation of many within this sector.
The delivery of service quality is a critical success factor for contemporary service firms. 
It is conceptually and empirically linked to customer satisfaction. This makes it the core 
marketing instrument for service companies, and the “single most researched area in 
services marketing to date” (Fisk, Brown, and Bitner 1995). According to Anderson and 
Fomell (1992) and Rust, Zahorik, and Keiningham (1995), research is now showing a 
positive link between service quality and profitability.
Service quality is the means by which new customers are attracted and existing customers 
retained. Service quality is one of the few means for service differentiation and gaining 
competitive advantage, which attracts new customers and contributes to the market share. 
Also, service quality is regarded as an important means for customer retention. It has 
been argued that high service quality enhances customers’ inclination to buy again, to
2
buy other services, to become less price sensitive and to spread good word of mouth 
(Anderson, Fomell, and Lehmann 1994; Rust, Zahorik, and Keiningham 1995). Zeithaml, 
Berry and Parasuraman (1996), found that service quality influences different intentions, 
such as giving recommendations, doing more business and willingness to pay more. 
According to them, one can view behavioural intentions as indicators that signal whether 
customers will remain with or defect form the company.
The concept of quality is even more important in the hotel business, which is part of a 
larger sector, the hospitality industry. According to Tom Powers (1995) the word 
“Hospitality” is derived from the term “hospice”. Hospice refers to a medieval house of 
rest, which also served as what could be called a nursing home in modem society. People 
expect hotels to render service “with liberality and good will” (ibid.) This expectation 
has serious quality implications for the industry.
Hotels now have to serve an increasingly discerning public, who are more eager than ever 
to complain and transfer their allegiances to perceived providers of quality services. This 
fact, coupled with the increasingly hostile nature of the business environment has forced 
many within this sector to invest in the delivery of higher levels of service quality as a 
means of achieving competitive differentiation (http://www.emesto.emeraldinsight.com/ 
Accessed on 09/10/01)
The management of customer perceptions of service quality has been proposed as an 
effective means of securing a competitive advantage
3
(http://www.anzmac99.unsw.edu.au/ Accessed on 09/10/01). There is increasing 
support for the argument that improved service quality perception lead to higher levels of 
customer retention and eventually higher profits for the organisation.
According to Abby Ghobadian et al (1994), in a survey, "quality", "customer 
satisfaction" and " identification of what constituted value to the customer" were 
identified by the respondent companies as either important or very important. This 
response illustrates the importance placed on quality and customer satisfaction by firms.
The empirical analysis of the Profit Impact of Marketing Strategy (PIMS) database 
demonstrates a positive relationship between perceived quality and a firm’s financial 
performance. Companies with perceived high quality goods and services had higher 
market share, higher return on investment and assets turnover, than companies with 
perceive low quality (http://www.alidoro.emeraldinsight.com/ Accessed on 21/09/01). 
This led to the conclusion that in the long term, the most important factor affecting 
business performance is the quality of goods and services offered by the organisation, 
relative to it’s competitors.
Service quality is considered a critical determinant of competitiveness. Attention to 
service quality can help a firm differentiate itself from other firms and through it gain a 
lasting competitive advantage. High quality of service is considered an essential 
determinant of the long-term profitability. Superior service quality is a key to improved 
profitability (ibid.)
4
Service quality therefore affects the purchase and re-purchase intentions of existing and 
potential customers. Marketing research has shown that customers dissatisfied with a 
service will divulge their experiences to more than three other people. Thus, it is 
reasonable to conclude that perceived poor service would reduce the potential customer 
base.
According to the Technical Assistance Research Project (TARP), it costs about four 
times more to attract new customers. Their research indicates that six times more people 
hear about a negative customer service experience than hear about the positive 
experience. Positive word of mouth can be a very powerful tool for attracting new 
customers. Negative word of mouth can have a devastating impact on the credibility and 
effectiveness of a hotel’s efforts to attract new customers (ibid.)
The customer's perception of what constitutes quality may not be the same as what the 
hotel considers to be quality service. The customers’ perception of the quality of the 
service being delivered will therefore determine whether they are satisfied with that 
service and whether they will want to continue to patronise the services of that hotel.
Thus, the relative perceived quality, based on the customer's judgements, can be the 
single most important factor in affecting the long run performance of a business. 
Customers' service expectations are constantly rising, while their tolerance for poor 
service is declining. As a result customers are increasingly likely to migrate to 
competitors with a perceived higher service quality.
5
According to Zeithaml and Bitner (2000), a major cause of poorly perceived service is 
the difference between what a firm promises about a service and what it actually delivers. 
There are several key factors (such as word-of-mouth communication, customer 
experiences with other service providers, and customer needs) that influence customer 
expectations that are largely uncontrollable.
Zeithaml and Bitner (2000) argue further that company advertising, personal selling, and 
the promises made by service personnel are controllable variables that influence the 
expectations that customers hold for a service. Accurate, co-ordinated and appropriate 
company communication that do not misrepresent or over promise is critical to delivering 
services that customers perceive as high in quality.
Service customers today are exposed to marketing communication from a wide variety of 
sources including online sources, servicescapes, and everyday service encounter 
interactions with employees, televisions and newspapers (ibid.). Any hotel that 
communicates through different channels needs to integrate them so that the customer 
receives unified messages and promises about its offerings.
Firm level communications about service promises what people do. However, human 
behaviour is unpredictable and cannot therefore be standardised. Consequently, the 
potential for a mismatch between customers’ expectation and their perceptions of service 
delivery is high. Furthermore, if the messages conflict, confused company images and
6
promises can occur, resulting in a gap between what customers expect based on the 
messages and what they receive in service delivery.
By regulating and co-ordinating communication within and outside the firm, ensuring 
that interactive messages are consistent both among themselves and with those sent 
through external communication, a hotel could reduce the level and propensity of a 
mismatch between service promises and delivery.
1.2 THE PROBLEM STATEMENT
Marketing communication has changed over the years. In the past, customers received 
information about various products (both goods and services) from mass marketing 
sources such as television and newspapers. It was therefore not too difficult to convey a 
uniform image and to co-ordinate claims made in marketing communication.
Today, however, consumers of both goods and services receive information from a richer 
variety of sources. In addition to information from mass marketing sources, customers 
also receive information from on-line sources and a host of other promotional tools.
Service customers receive information from an even much richer sources including the 
servicescape and everyday service encounter with employees. According to Philip Kotler 
(2000), consumers are exposed to over 1,500 adverts a day, ranging from television 
advertisement to billboard and product packages. These sources add to the variety, 
volume and complexity of information received (Zeithaml and Bitner 2000).
7
Firms therefore use a variety of communication tools to send their messages in an effort 
to capture the attention of prospective customers. Consequently, firms:
• Exaggerate or over promise their service in order to attract customers, thereby 
unnecessarily elevating customer expectation.
• Fail to co-ordinate marketing communication with internal operations, resulting in 
promises that cannot be fulfilled.
• Do not integrate the messages from various promotional tools, resulting in conflicting 
promises.
These influence customer expectations and eventually impacts on how the customer 
perceives the quality of the service provided.
1.3 PURPOSE OF THE STUDY
The purpose of the study is to explore the concept of service quality and how the various 
tools of marketing communication affect expectation and influence perception of service 
quality. The study would also high light strategies that can be used to effectively 
manage customer expectations in an effort to improve customer perception of service 
quality.
1.4 OBJECTIVES OF THE STUDY
The objectives of the study are to:
• Explore how firm level communication influences customer perception of service 
quality.
• Establish the extent to which the degree of integration of firm level communication is 
related to the degree of influence on customer perception of service quality.
• Determine the most significant factor(s) that influence customer perception of service 
quality in the hotel industry in Ghana.
1.5 SIGNIFICANCE OF THE STUDY
The study would enable people to appreciate the factors underlining a customer’s 
perception of any particular service encounter. The study would demonstrate the 
importance of integrating various elements of the promotional mix in the hotel industry. 
Managers of service firms will find the study a useful material in aiding them to plan and 
execute effective strategies to improve customer perception of the service they render.
Also, the study would serve as a reference material for both the academia and the general 
public. Particularly for the academia, it will be a very useful contribution to knowledge, 
upon which further research work can be conducted into the relationship between service 
quality perceptions and service marketing communication.
9
1.6 RESEARCH QUESTIONS
The study, which is descriptive in nature, is designed to answer the following research 
questions.
Ql What will customer perception of service quality be when firm level 
communication claims more than the hotel can deliver?
Q2 When firm level communication is integrated to present a consistent and unified 
front, how will it affect customer perception of service quality?
Q3 Will inadequate internal communication lead to a poor perception of service 
quality?
Q4 What is the most important factor that influences service quality perception?
1.7 ORGANISATION OF THE STUDY
The study is divided into 6 chapters. Each chapter is designed to capture specific subject 
matter as detailed below.
Chapter one: Introduction
The chapter captures the background to the study, the problem statement, purpose, 
objectives, and significance of the study. It also contains the research questions and 
operational definitions.
Chapter two: An overview of the hotel industry
This Chapter offers an overview of the hotel business. It takes a look at the performance 
of the industry in the past decade, and what the future holds for the industry. It also
10
analysis the impact of the September 11th, 2001 tragedy on the industry. The chapter also 
takes a look at the structure of the industry in Ghana.
Chapter three: Theoretical background
This chapter discusses service quality and service quality dimensions. It also discusses 
customer perception of service quality. The chapter takes a look at customer expectation 
and how it influences customer perception of service quality. Finally, it reviews 
communication theories and describes marketing communication variables that influence 
customer expectation and perception of service quality.
Chapter four: Research methodology
This chapter outlines the sampling techniques that have been applied and how the 
research is designed. The data collection methods and instruments used are also 
described, as well as how the collected data is analysed.
Chapter five: Presentation and analysis
The data that has been gathered from the field is presented and analysed using various 
statistical tools and tables in this chapter.
Chapter six: Conclusion and recommendation
This chapter draws conclusions from data gathered in the survey, and makes 
recommendations for the management of service firms and for probable future research 
themes.
11
1.8 OPERATIONAL DEFINITION
Firm Level Communication: In this study, firm level communication refers to a firm’s 
external marketing communication, internal and interactive marketing. External 
marketing communication includes such variables as advertising, sales promotion, 
publicity and public relations, direct marketing and pricing.
Vertical and horizontal communications in the firm constitutes internal marketing. 
Interactive marketing on the other hand comprises activities such as personal selling, 
customer service centres, service encounters and servicescapes. It also includes on-line 
or Internet based communication such as web site.
High quality service: This refers to a customer’s assessment of a service experience as 
having met or exceeded his expectations.
Poor quality service: This refers to a customer’s assessment of a service experience as 
having fallen short of his expectations.
The masculine pronoun: These pronouns, he, him and his and the term “man” are used 
to represent both the male and female genders.
Executive Management: Executive management describes the senior management 
bracket in each hotel. This typically includes Financial Controllers, General Managers,
12
Directors, Chief Executives and Managing Directors, or such other names as may be 
applicable to managers in this category.
Front line staff: These are service employees who come into direct contact with 
customers dining the delivery of the service.
Backstage staff: These are service employees who do not come into direct contact with 
customers during the delivery of the service, but rather support the front line staff in 
meeting the needs of the clients.
13
References
1. http://www.nedlac.org.za/docs/ Accessed on 05/04/02
2. http://www.nscb.gov.ph/secstat/ Accessed on 05/04/02
3. http://www.info.gov.hk/isd/hk98 Accessed on 05/04/02
4. http://www.utdt.edu/comgresos/empresarial Accessed on 05/04/02
5. Valarie A. Zeithaml and Mary J. Bitner, 2000, Services Marketing, Integrating
Customer Focus Across The Firm, New York, Irwin, McGraw-Hill
6. Lee D. Dahringer and Hams Muhlbacher, 1991 International marketing, A Global 
Perspective, Addison-Wesley publishing company.
7. http://www.alidoro.emeraldinsight.com/ Accessed on 09/21/01
8. http://www.enesto.emeraldinsight.com/ Accessed on 09/21/01
9. http://www.anzmac99.unsw.edu.au/ Accessed on 09/21/01
10. Tom Powers, 1995, Introduction To The Hospitality Industry, New York, John
wily and Sons Inc.
11. G.E Belch and M. A Belch, 1995, Introduction to Advertising and Promotion, An 
Integrated Marketing Communication Perspective, New York, Irwin.
14
CHAPTER TWO
2.0 OVERVIEW OF THE HOTEL INDUSTRY
2.1 INTRODUCTION
The hotel industry is a dynamic service sector that accounted for about 14% of total GDP 
in Europe in 1999. (http://www.hotelbenchmark.com/ accessed on April 05, 2002). The 
fortunes of the industry keep fluctuating. According to the Real Estate Finance Journal, 
(1994) the American Market experienced a decline in demand between 1980 and 1983, 
and in 1991. Thereafter, demand increased every other year.
While layout, facility design, condition of property and quality of management affect a 
particular hotel, external factors such as global recession and activities of various militant 
activist affect the fortunes of the industry globally. This makes the prediction of the 
future direction of the industry difficult.
This chapter therefore gives an overview of the hotel industry in an attempt to provide an 
accurate estimate of the size of the global hotel industry, assess its recent performance, 
and identify current and future hospitality trends and their impact on hotels.
15
The Chapter will also take a look at a number of core issues facing the industry, the 
impact of the September 11, 2001 terrorist attack on the USA, and the structure of the 
hotel industry in Ghana.
2.1.1 Structure of the Chapter
This chapter is made up of six sections and draws on material from a “White Paper on the 
Global Hospitality Industry” presented by the International Hotel and Restaurant 
Association. Materials from the HVS International Journal, The Ghana Tourist Board 
Directory and several other articles have also been incorporated in this chapter.
The various sections of the Chapter is as follows:
• A statistical analysis of the scale of the industry globally
• A review of the global hotel industry in the late 80s and the 90s.
• A projection of the variables that will drive change in the industry in the coming 
years.
• An exploration of some of the issues that are of key significance to the hospitality 
industry globally.
• An assessment of the impact of the September 11, 2001 tragedy.
• The structure, current and future supply of hotel rooms in Ghana.
2.2 THE SCALE OF THE GLOBAL HOTEL INDUSTRY
The International Hotel Association (IHA) White Paper on the Global Hospitality 
Industry revealed that the hotel industry the world over generated over USSS247 billion
16
in revenues in 1994. They observe that the highest concentration of hotels is in Europe 
and North America. There is however a considerable growth in the emerging markets.
IHA estimated that there are about 307,683 hotels worldwide with a total number of 
11,333,199 hotel rooms. They also estimated that “hotel room requires from as little as 
$15,000 to as much as $30,000 to build”. They therefore concluded form these estimates 
that the total assets value for the industry range from about $170 billion to $128 trillion.
IHA further stated that there is about one employee for every hotel room in the world. 
Hotels employ more than 11,194,418 people the world over. This constitutes about 5% 
of the world’s total workforce in travel and tourism. About 36% of these are employed in 
the Americas.
The industry is an essential and dynamic sector of the world’s travel and tourism 
industry. The hotel industry covers a variety of accommodations; full service luxury 
hotels, bed and breakfast inns, resorts, limited service and economy properties and so on. 
They are owned and / or managed by independent operators, multinational chains, 
pension funds, government and a host of other investors.
Hotels represent a sizable capital investment and as noted earlier, employ hundreds of 
people. They purchase a variety of products and services from the community they are 
located thereby improving the local economy. They also contribute significantly to the 
tax revenue of the nations in which they operate.
17
According to IHA, each dollar spent in a hotel generates additional revenue and jobs. “In 
the United States, for example, every dollar spent by a hotel guest creates about one 
additional revenue dollar in the local community across a wide range of businesses” 
(http://www.ih-ra.com/ accessed on 14/04/02)
With the expansion and consolidation of free market economics and democracy in Africa, 
South America, Asia and the Middle East, the political risk associated with investment 
declines. There are therefore significant growth opportunities ahead in the markets, and 
the prospects for hotel development are encouraging.
2.3 INDUSTRY PERFORMANCE IN THE LATE 80s AND THE 90s
The successful performance of individual firms within the industry depends on how well 
firms identify the threats and opportunities that exist in its business environment and how 
it Marshalls and allocates resources to maximise the opportunities and avoid the threats. 
Within the past two decades or so the industry was characterised by a series of major 
global changes. Many of these changes were influenced by the fall of communism and 
the shift to a free market economy among emerging markets. Various opportunities arose 
for investment. This included the acquisition of prime real estate for developments in 
services, prompting an escalation of real estate prices worldwide and a surge of investor 
interest in the hotel business.
In 1985, for example, the hotel industry was rapidly developing an oversupply problem. 
At the end of December 1985, the value of the US dollar had fallen drastically against
18
other major currencies. This made investment in real estate in the US even more 
attractive to overseas investors, which further fueled the building of more hotels in the 
industry (http://www.ih-ra.com/, http://www.hvsintemational.com/ accessed on 
14/04/02)
According to the IHA White Paper, the recession and the Gulf War in the early 1990 
impacted heavily on the industry. Real estate values plunged by as much as 50% and 
many big global players like the Japanese stopped all hotel development activity. At the 
same time, hotels were downsizing as a result of businesses evaluating costs more closely 
and consequently cutting back significantly on travel expenses.
The decade saw the emerging and unprecedented development and growth of the 
information age. According to IHA there have been a “major socio-cultural shifts on 
travel patterns, such as the growing dominance of women in the workforce, the growth of 
the middle class in the developing world and the labour shortage experienced by both 
developing and developed nations”. These developments put enormous pressure on the 
hotel industry.
However, despite the collapse of real estate values and the accompanying inflationary 
spiral, multinational hotels rose to the challenges with a variety of competitive strategies. 
The IHA observes that between 1985 and 1990 hotels adopted “new marketing 
approaches including loyalty programmes, alliances and computerised reservation 
systems, and the expansion of brands to address specific market segment".
19
They also adopted practices such as niche marketing, price discounting, service quality 
concepts, and short stay/ weekend break products. Cruise business, the rise of budget 
chains, and the growing recognition of the importance of the travel agent, were some of 
the practices adopted to meet the challenges of the times.
With hotel room supply exceeding demand, and the labour shortage taking its toll, the 
emerging new technology became an attractive solution to the hotel industry’s problems. 
Hotels made maximum use of computers in their operations: from reservation systems to 
customer databases.
The 90s were a hostile business environment for the industry. Many hotels defaulted, 
nearly half of the all hotels were thought to be in financial distress, and up to 70% of the 
global inventory of hotel rooms was estimated to be in need of refurbishment (Ibid.).
The industry was however saved from the brink of disaster, as hoteliers and investors 
adopted various schemes to save then properties. They brought in asset managers, 
merged and consolidated, laid off people and stepped up revenue yield maximisation 
programmes and services. A number of hotels were successful and had good cash 
reserves. They were able to do some renovations or take advantage of good deals on 
distressed hotels. (Ibid.)
The industry had to refine their earlier initiatives in service, employee development, 
travel agent programmes, quality management and business traveller services. Strategic
20
alliances expanded and performance improved. There was a surge in global growth with 
joint ventures, master franchising and management contracts. (Ibid.) However, the 
anticipated consolidation of the industry into a handful of major hotels failed to 
materialise.
The IHA white paper on the global hospitality industry concludes by confirming “the 
value of strategic thinking in the decade to come and the likelihood that, in future, the 
multinational hotel industry will create links between resource allocation, competitive 
methods and more productive performance. The turbulence of the last decade may have 
subsided but, the Paper argues, today’s hotel leaders must acknowledge the importance of 
better forecasting and long term strategic management if they want their companies to 
survive into the new millennium”.
2.4 VARIABLES INFLUENCING THE FUTURE OF THE HOTEL 
INDUSTRY
The IHA convened four “Visioning the Future” workshops in Amsterdam, Hong Kong, 
Sydney and Mexico City. Representatives of multinational hotel companies, 
telecommunication firms, investment banks, travel distributors, national hotel 
associations, academia, consultants and supplier companies were invited to share their 
visions of the future for the hotel industry.
They identified 5 factors, which they believed would drive change and shape the hotel 
industry over the next decade:
21
Capacity Control: The information superhighway is increasingly exerting its influence 
on how the inventories of hotel rooms, airline seats, car rentals and so on are sold. 
Eventually, the hospitality industry will lose control of the sale of its inventory. 
Information technology will therefore have a telling effect on how the industry will sell it 
services.
Safety and Security: Today’s traveller is increasingly confronted with potential dangers 
to personal safety and health. This stems from the potential risks of contracting AIDS 
and the uncertain yet devastating nature of terrorism, which is changing day in day out. 
The industry will therefore have to do more in order to reassure guests as well as 
investors seeking to protect themselves from asset losses. The attempt to respond 
appropriately to these challenges will have a bearing on the future of the industry.
Assets and Capital: Because of the global shift to a market economy many experts, 
according to the IHA white paper predicts that it will ultimately result in a shortage of 
capital to meet existing development needs in the hotel industry. Available funds will go 
to those industries that can generate high returns and stay ahead of trends. The extent to 
which the hotel industry is able to generate a competitive return on investment will 
determine how much capital will be invested in the industry. The amount of capital 
available to the industry globally will definitely affect the trend and development of the 
industry.
22
Technology: Technology is becoming the most important competitive advantage hotels 
can have in the coming years and beyond. The White Paper asserts that a lot of 
transactions are negotiated in the channels of the information super highway. Hotel 
operation must therefore comprehend and appreciate the new technology. They must 
learn to navigate this emerging medium to successfully market their products and 
services. The way and maimer hotel managers and owners embraze information 
technology will shape the future direction of the industry.
New Management: The global hotel industry is changing fast. The role of the hotel 
manager has therefore become very strategic. This calls for hospitality leaders who can 
effectively manage the speed of change in the industry. They must be able to efficiently 
share their time between internal operations and scanning the environment. This will 
enable them incorporate significant trends into their day to day operations.
The IHA White Paper emphasises the need to adopt a new paradigm shift and take a new 
approach. It cautions that these factors will shape the future of the industry sooner than 
later. “For hotel companies to survive, they must be willing to incorporate this vision 
into their long-term business strategies”.
2.5 ISSUES OF STRATEGIC IMPORTANCE TO THE HOTEL INDUSTRY
The following issues were articulated by the International Hotel Association’s White 
Paper on the global hospitality industry. These issues are strategic to the development,
23
growth and profitability of the hotel industry all over the world. It would help boost 
growth in the hotel industry if the relevant bodies attend to these issues.
Copyrights
The hotel industry is a major contributor to the fees paid on copyrights. Copyrights fee 
therefore represents a substantial cost item to the industry. The IHA believes that 
copyrights fee should be determined by market forces and opposes the control of 
copyrights fee by Government. The industry will benefit from higher profits when cost 
centres such as copyrights fee are kept at the lowest levels possible.
Flexibility of Working Conditions
The hotel business lends itself to a fluctuating supply of work. The emergence of new 
technologies and international competition makes the maintenance of a flexible working 
condition for the industry a necessity. The IHA advocates for an increased flexibility of 
labour conditions. This, they believe will encourage job creation, enhance customer 
satisfaction and profitability and accommodate the varied preferences of employees in the 
industry.
General Agreement on Trade in Service (GATS)
GATS advocates for the liberalisation of trade in service. The IHA strongly supports this 
position, arguing that tourism accounts for more than 33% of the world’s service exports. 
The free flow of people and services is therefore an essential ingredient for the global
24
hotel industry. They hold the conviction that existing barriers to international travel 
(passport, visa and so on) must be abolished to enhance international travels.
Industry Statistics
Though the hotel industry contributes so much to the global economy, it does not receive 
the public recognition at the level commensurate with its contribution. According to 
IHA, this is because of the lack of accurate and reliable data on the scale and value of the 
industry. They therefore suggest that a way around this problem is to develop data and 
statistics on tourism within a common framework.
Smoking in Public Places
Another area of concern to the IHA is the legislation restricting smoking in public places. 
They argue that the interest of the industry is best served by accommodating the diverse 
interest and preferences of various guests. This interest is limited by the said legislation. 
To curtail the growing trend of such legislation, IHA suggests that the hotel and 
restaurant industry adopt programmes such as “The courtesy of choice” to pre-empt the 
imposition of legal restrictions.
Sustainable Tourism and the Environment
IHA believes that the conservation of the natural environment is essential to ensure a 
sustainable growth of the hotel industry. The industry should practice self-regulation, 
which they argue has the unique potential to achieve environmentally compatible growth.
25
Taxation of the Hotel Industry
There is a proliferation of fees and taxes imposed on the tourism industry and the 
international traveller. Such taxes and fees include sales tax, airport tax, VAT, hotel 
occupancy tax, and so on. This, IHA claims, has shown to impede industry growth and 
distort competition. IHA therefore calls for the lowest level of taxes to be levied on the 
industry to boost their competitive edge and to enhance their job creating capacity.
Traveller Safety and Security
Hotels globally are increasingly becoming susceptible to crime. There is also a growing 
concern among hotel guest with respect to safety and health issues. IHA recommends 
that the main way to combat organised crime is for the public and private sectors to foster 
a greater co-operation and intensify their international efforts. These measures they 
believe will help restore the confidence of the hotel guest and boost industry activities.
2.6 THE IMPACT OF THE SEPTEMBER 11,2001 TRAGEDY
The global economy and particularly the United States of America’s (USA) economy 
have been affected by the tragic events of the September 11, 2001. The attack helped 
accelerate the US economy, which was already slowing down, into a recession. The 
impact on the airline industry is tremendous, and so is the impact on the hospitality 
industry. According to the HVS International Journal (October 2001), “the income levels 
experienced by virtually all hotels in the US have been adversely affected by the terrorist 
attack”.
26
Following the attack, most bookings for September and October, especially in the USA 
especially were cancelled. Indeed, some markets had reported 60% to 70% decreases in 
occupancy in the week following the incident (ibid.).
The HVS International Journal (October 2001) however believes that the downturn in 
demand is only temporary. Writing on the US market, the Journal confirms that after a 
series of cancellation of hotel bookings in September and October, November and 
December bookings were held firm. Cancelled trips were re-booked in late 2001 and 
early 2002. The said Journal confirms that reports are circulating which indicates a 
rebound in travel. Markets that had reported up to 70% decrease in occupancy in the 
week following the events of September 11 have since seen some occupancy recovery. 
The larger question however is what the future holds for the industry in respect of hotel 
revenues.
According to the above mentioned Journal, there is a heightened perception of the risk 
associated with the hotel industry, which makes obtaining funding for new construction 
of hotels very difficult.
The said Journal concedes that even before the events of September 11th, supply growth 
had decelerated markedly due to the over building of hotels that had occurred in the 
preceding 5 years. Consequently, supply growth is expected to decrease dramatically in 
the years following.
27
The Gulf War of the early 90s coupled with the recession at that time affected hotel 
values. For instance, the uncertainties of war and recessions forced hotel values down 
about 10% in 1990; it further fell by 28%. Values stabilized in 1992 and since then (up 
to the year 2001) had been rising.
In general, it is expected that the same pattern of decline, stability and growth is expected 
to emerge in the coming years, though hotel values are not anticipated to fall as 
dramatically as it was in 1991 during that recession and the Gulf War (Anne R. Lloyd- 
Jones, HVS International Journal, October 2001).
Hotel values were expected to fall in the near term. In the long term however, hotel 
values are expected to increase to levels at or above those achieved in the last three years 
(ibid.)
2.7 THE STRUCTURE OF THE HOTEL INDUSTRY IN GHANA
The Hotel Industry in Ghana is a vibrant business sector. The sector has experienced 
unprecedented growth rates averaging 6.5% over the past five years. Growth in the Hotel 
sector is in tandem with the growth pattern over the past decade in tourism arrivals to 
Ghana. Tourism, currently the third largest foreign exchange earner is gaining 
prominence and recognition in Ghana.
28
The growth in tourism in Ghana is attributable to the development and improvement of
tourism infrastructure, improved communications, and prudent government policies. The
stable political environment in Ghana has further bolstered growth.
Ghana’s hotel industry is characterised by a pyramid made up of:
• “Large Size” hotels (4-5 star) managed by international chains and have 100 rooms or 
above.
• “Medium Size” (below 100 rooms) hotels. These are basically the 3-star hotels.
• “Small Size” hotels (1-2 star, guest house) have an average of 15 rooms. These 
hotels are managed by owners. The Ghana Tourist Board has classified guest houses 
as hotels with less than 10 rooms.
• Budget hotels are owned and managed by local entrepreneurs, and offer services 
below 1 star requirements.
• Tourist Homes are registered “homes lodging scheme” where families rent out rooms 
to clients especially, tourist.
29
Figure 2.1 Structure of the hotel industry in Ghana.
Source: Adapted from Ghana Tourist Board
2.7.1 Current hotel supply
Based on the Ghana Tourist Board’s local classification and rating system, a total of 747 
hotels with a national stock of 10,886 rooms were licensed and rated in 2000. The ratings 
and distribution of the hotels in Ghana is provided in Table 2.1. Table 2.2 captures the 
distribution of hotel rooms in Ghana.
30
Table 2.1 National Distribution of Licensed Hotels (2000)- Courtesy: Ghana Tourist Board
egion SStar 4Star 3Star 2Star 1Star GuestHouse Budget
Homes Total
shanti 3 11 13 11 88 . 126
ronghafo - 1 2 1 44 48
tentral 2 7 18 3 29 59
astern 1 3 6 2 32 44
ireatertccra 2 2 10 29 41 46 198 3 331[orthem 3 2 3 9 17Jpper East 9 9
J. West 1 1 1 10 13
folta 2 6 32 40
Vestera - 3 8 15 7 27 60
TOTAL 2 2 19 65 104 74 478 3 747
Table 2.2 Distribution o f  Hotel Rooms (2000)- Courtesy: Ghana Tourist Board
legion 5Star 4Star 3Star 2Star 1Star GuestHouse Budget Homes Total
Vshanti 66 403 264 63 1076 1872
^<2
11 40 26 6 458 530
Central 129 124 189 22 341 805
fastem 35 38 101 15 347 536
rreater■ccra 224 414 406 575 710 316 2324 11 4980
[orthem 54 40 56 138 288
[pper East 155 155
. West 40 18 4 105 167
olta 84 175 326 585
Western 100 136 300 43 389 968
TOTAL 224 414 736 1494 1823 525 5659 11 10886
31
An Analysis of Table 2.1 and 2.2 provides the following summary of ratings for hotels 
and room supply in Ghana.
Table 2.3 Summary of ratings for hotels and room supply- 2000
Star rating Number Of hotels RoomSupply5 star 2 2244 star 2 4143 star 19 7362 star 65 1,4941 star 104 1,823Guest house 74 525Budget hotels 478 5,659Homes 3 11
Source: Adapted from Ghana Tourist Board
The bulk of Ghana’s hotel room is therefore, in the “small size” and “budget” categories 
noted above. Over 45% of the nation’s stock of hotel rooms is concentrated in the capital 
city, Accra. Accra also has the entire stock of room licensed in the four and five star 
category. Besides Elimina and Accra, no hotel facility in Ghana offer a minimum size of 
100 rooms.
2.7.2 Projected Hotel Supply
There are various investment activities currently going on in the country that will 
significantly increase the hotel supply in Ghana over the next decade. However, the most 
significant developments are in Accra.
32
Accra’s current supply of 1,044 rooms in the 3-5 star categories is estimated to increase 
by additional 2280 rooms over the next five years period ending 2006. The projected 
increase is over 200% in room capacity.
It is clear from the data presented and analysed here that with investor friendly policies 
and, stable political and micro-economic variables, the hotel industry in Ghana is set to 
grow despite the tragedy in the Middle East and the USA. Data from the Ghana Tourist 
Board Directory (2000) indicates that international tourist arrivals have been growing 
over the years. For instance, in 1990, international arrivals was 145,780, while in 1996, it 
increased to 304,860. They estimate that by 2010, international arrivals would be 
1,062,000.
33
References
1. http://www.hvsintemational.com/ accessed on 14/04/02
2. http://www.hotelbenchmark.com/ accessed on 05/04/02
3. http://www.hvsintemational.com/ accessed on 23/03/02
4. http://www.ih-ra.com/ accessed on 14/04/02
5. http://www.hs.ttv.edu/ accessed on 05/04/02
6. Ghana Tourist Board Directory, 2000
CHAPTER THREE
3.0 THEORETICAL BACKGROUND
3.1 CONCEPTUAL FRAMEWORK
Quality service delivery is a critical element for the continued survival and growth of 
service firms. This is especially so as the business environment is becoming increasingly 
competitive. Assessment of service quality is however a subjective judgement that is 
influenced by the perception of the customer. Perception is in turn influenced by the 
expectation of the customer of the customer prior to his experience of the service. 
Meanwhile, customer expectation itself is shaped by the marketing communication that 
the customer is exposed to.
In this respect, the chapter will review relevant concepts and theories on the key 
dimensions of the study. These include,
• Service Quality
• Customer Perception
• Customer Expectation
• Marketing Communication Variables
The'study will also explore the relationships between these key dimensions.
35
Essentially, the study will attempt to define and analyse the concept of service quality. It 
will indicate the various service quality dimensions and how they are used to measure 
service quality. Relevant customer perception concepts will also be explored. Of 
particular interest is how customers’ sense external stimuli, how they select various 
sources of stimuli, and how they interpret and give meaning to the external stimuli so 
selected. The interpretation of external stimuli is important to the service marketer as it 
impacts on the customer’s eventual assessment of the quality of service.
Customer expectations, the controllable and uncontrollable factors influencing customer 
expectation, and the role expectation plays in service quality perceptions will be 
explored. The study is however focused on the controllable factors, which mainly consist 
of the marketing communication variables.
Consequently, the study will review relevant theories and concepts in respect of 
marketing communication variables. The study will also attempt to analyse the various 
elements of interactive, internal and external marketing communication variables, and 
how they combine to influence the service customer’s expectations. To appreciate how 
marketing communication variables affect customer expectations and perceptions of 
service quality, it is important to also review theories and concepts in communication and 
response processes.
36
3.2 WHAT IS SERVICE QUALITY
Service quality is a major determinant of competitiveness. This is especially so in an 
increasingly hostile business environment where service firms have to serve an 
increasingly discerning public who would readily complain and transfer their allegiances 
to perceived providers of quality service. However, despite the importance of quality, 
different experts and writers on quality have defined it variously.
Quality Digest (2000) defined quality as the measure to which products, processes, 
services and relationships are free from defects, constraints and elements that do not add 
value for the benefit of the customer. Quality can also be seen as the totality of features 
and characteristics of a product or service that bear on the particular product or service’s 
ability to satisfy stated or implied needs of a customer.
Where there is a perceive congruence between a customer’s expectation of a service and 
what has been received, or where perception of service quality is higher then expected, 
then a high quality is said to have occurred. Alternatively, a low service quality occurs 
when perception of actual service is lower than expected. Quality is therefore a 
maximisation of perceived value.
According to Quality Digest (2000) quality can be objective or subjective. Objective 
quality refers to the degree to which a process or its outcome complies with a determined 
set of criteria, which are presumed essential to the ultimate value it provides. Subjective 
quality on the other hand refers to the level of perceived value experienced by a customer
37
who has benefited from a process or its outcome. Quality can therefore be said to be the 
perception of a customer of the value he has received for the price he has paid for the 
attributes of a product or service as they relate to it's fit, function and form.
3.2.1 Classification of Quality Definitions
According to Abby Ghobadian et al (1994), quality definitions can be classified into five 
broad categories depending on the main thrust of the definition. He termed them as 
Transcendent, Product led, Process or Supply led, Customer led and Value led 
definitions.
Transcendent Definitions
This group of definitions sees quality as an innate excellence. A product or service has 
unique and unequalled properties that contain an inherent ability to satisfy the needs of a 
customer.
Product Led Definitions
Definitions that emphasise product see quality as units of goodness packed into a product 
or service that a customer can benefit from. A higher service quality therefore contains 
more units of goodness than a lower service quality. This definition assumes that the 
units of goodness or service attributes can be quantified. In practice however, it is 
difficult to clearly identify and quantify service attributes. Furthermore, goodness is not 
absolute but relative to a particular customer and circumstance.
38
Process or Supply Led Definitions
Quality can again be defined as conformance to requirements. The focus of these 
definitions is internal and they lay emphasis on the importance of the management and 
control of supply side quality. This definition is relevant to organisations that provide 
standard products or services, or where organisations perceive their quality problems as 
lying within the engineering or transformation process. This is partly because, "process" 
play a critical role in determining the quality of the outcome.
Customer Led Definitions
The focus of customer led definitions is external. Quality is seen as satisfying customer 
requirements. This approach relies on the capacity of the organisation to determine and 
meet customer requirements. Customer led definition encompass the process approach. 
Though customer requirements are build into the service at the design stage, it is during 
the transformation stage that the level of conformance is determined. This category of 
definitions is most relevant to such organisations that offer services that have high 
contact, labour intensive and skill-knowledge-based. Hotels, health care, law and 
accountancy are good examples.
Value Led Definitions
Value led definitions are also externally focused. Quality is defined in terms of the cost 
of a product or service to the producer and the price to the customer. It is also seen as 
satisfying the customer’s requirements in respect of quality, price and availability.
39
3.2.2 Types of Service Quality
Researchers in service quality have demonstrated that though a satisfactory outcome is a 
prerequisite for good perceived quality, because of the simultaneous production and 
consumption nature of service, perception of the process is also important for the total 
quality of a service experience to be perceived as satisfactory.
Drawing on the work of Gummesson (1977) which dealt with aspects of the quality of 
services, and on Bettman’s work (1979) on perspectives from cognitive psychology, Dr. 
Christian Gronroos (1998) developed the concept of perceived service quality. He 
argued that service quality is a multidimensional phenomenon that comprised three 
dimensions, as depicted in the diagram below, namely, Technical quality, Functional 
quality and, Corporate image.
Figure 3.1 Perceived Service Quality
Source: Adapted from Journal of Business & Industrial Marketing, Vol. 13 No. 4/5 1998
40
Technical Quality:
Dr. Gronroos argued that the ultimate outcome of any service experience is referred to as 
the technical quality, and can be measured objectively by a customer. For instance, the 
delivery of a parcel by DHL. Technical quality is essential in quality perceptions of 
service that are high in experience quality.
Functional Quality:
Dr. Gronroos maintained that the functional quality dimension refers to the encounter 
between the customer and the service provider. That is, how the service process 
functions. The assessment of this quality dimension is subjective. Functional quality is a 
critical factor in quality perception of services that are high in credence quality.
Corporate Image:
Dr. Christian Gronroos in his article "The Perceived Service Quality Concept a 
Mistake?” Published in the Journal, Managing Service Quality, volume II, issue 3, 
argues that corporate image is an important quality dimension which is concerned with 
consumers’ perception of the service provider. The corporate image is influence by the 
technical and functional quality, price, external communication, physical evidence, 
competence and behaviour of service employees. Corporate image is also important in 
quality perception of services high in credence quality.
Lehtinen and Lehtinen (1992) also argued that service quality has three dimensions. 
These dimensions include physical, corporate and interactive quality. Physical quality
41
referred to the present conditions of physical items such as building and enabling 
equipment. The service provider's image and profile is called corporate quality, while 
interactive quality refers to the interaction between service employees and customers, as 
well as interactions between customers themselves.
3.2.3 Measuring Service Quality
Service quality is a measure of the degree to which the service delivered meets the 
customer’s expectation. Service quality is said to be ideal, satisfactory or unacceptable 
where service quality is perceived to be higher than customer’s expectation, exactly as 
expected or lower than customer expectation respectively.
Various researches suggest that customers do not perceive service quality as a uni­
dimensional concept, but as a multiplicity of factors. Parasuraman et al (1993) suggested 
that customers assess quality for all goods and services on the basis of the following eight 
factors: Performance, Features, Reliability, Conformance, Durability, Serviceability, 
Aesthetics, and Perceived quality.
Other researchers have argued that customers apply different dimensions in different 
product categories to determine their satisfaction levels with services delivered. For 
example, research on perceptions of quality in automobiles has shown that customers 
assess quality on six dimensions; Reliability, Serviceability, Prestige, Durability, 
Functionality and Ease of use. (Brucks and Zeitham 1991) However, researches on 
food products suggest that rich full flavour, natural taste, fresh taste, good aroma and
42
appetizing looks determined perceptions of quality in thirty-three food categories. 
(Bonner and Nelson, 1985)
Research within service quality and the related domain of satisfaction was initially 
pioneered through the conceptral framework of European researchers such as Dr. 
Gronroos (1983) and Oliver (1980). However, the foundation for much of the more 
recent conceptual development can be attributed to three North American academics, 
Parasuraman, Berry and Zeithaml. Parasuraman et al (1985) proposed a conceptual 
framework that comprised ten components that customers use to evaluate service quality. 
These components include Reliability, Responsiveness, Tangibility, Competence, 
Courtesy, Credibility, Security, Access, Communication, and Understanding/ 
Knowing the customer.
When a firm is able to fulfil a promised service dependably, accurately and on time, that 
firm is said to be reliable. Even though reliability is not the sole determinant of service 
quality evaluations, it appears to be the most important. Parasuraman et al, contend that 
since 1983, they have systematically investigated the topic of service quality through a 
series of studies. According to them, empirical evidence from their research consistently 
shows that reliability is the foremost criterion customers consider in evaluating a 
company's quality of service.
The ability and willingness to help, provide prompt service and effectively deal with 
complains is an indication of a firm’s level of responsiveness. The appearance of
43
physical facilities, equipment, personnel, and printed and visual communication materials 
constitute tangibility.
Competence means the service employee has the necessary skill, knowledge and 
information to effectively deliver the service required. Courtesy on the other hand refers 
to the employee being polite, respectful, considerate and friendly. Credibility is a quality 
dimension that relates to the corporate image, personal traits of front-line staff, and 
customer perception as to whether the service employee is honest and can be trusted. 
Security, access and communication are also quality dimensions customers use to assess 
service quality. Security refers to a customer's feeling of freedom from danger, risk and 
doubt, and includes physical safety, financial security and confidentiality. Access on the 
other hand refers to the ease of approachability and contact. This could for example, 
involve convenient opening hours, convenient location and getting through on the phone 
easily. Communication involves listening to customers, acknowledging their comments 
and keeping them informed in a language they can understand. Understanding and or 
knowing the customer is the final quality dimension and involve firms making an effort 
to understand the customers needs and specific requirements, and providing 
individualised attention.
However, Abby Ghobadian et al (1994) in their article "Service Quality" Concepts and 
Models, published in the International Journal of Quality and Reliability Management, 
vol. II, issue 9, introduced an eleventh quality dimension which they called 
customisation. They argued that customers’ perception of the quality of service is also
44
influenced by the degree to which a service provider is willing and able to adjust the 
service to meet the needs of the customer. This would mean for example that in the case 
of a gourmet restaurant, willingness to provide an item that is not in the menu.
In 1988, Parasuraman et al specifically identified five distinct components of service 
quality. Reliability, Responsiveness, Tangibles, Assurance and Empathy. They 
maintained that customers used these dimensions to compare their prior expectations of 
what service should be provided with their post experience perceptual reality. These 
quality dimensions were later formed into a multiple item scale entitled SERVQUAL for 
measuring consumer perceptions of service quality. In essence, these five components of 
service quality contain all the original ten dimensions for evaluating service quality. 
Table 3.2 below clearly depicts the relationship between the original ten quality 
dimensions and the five quality dimensions later identified.
Table 3.2 Correspondence between the ten original quality dimensions and 
SERVQUAL dimensions.
SERVQUAL DIMENSIONS ORIGINAL TEN QUALITY DIMENSIONSReliability ReliabilityResponsiveness ResponsivenessTangibles Tangibles
Assurance Competence, Courtesy, Credibility, Security
Empathy Access, Communication Understanding/ Knowing the customer
Source: Adapted from www.arl.org/libqual/events/ Date of access: October 15, 2001
45
3.3 CUSTOMER PERCEPTION
We live in a modem world where the consumer is exposed to thousands of stimuli a day. 
According to Philip Kotler (1996) the average consumer is exposed to over 1,500 adverts 
a day, ranging from television advertisements to billboards and product packages.
Consumers may perceive the same stimuli under the same conditions differently. They 
would therefore act and re-act on the basis of their perception of what is reality, which 
may differ from the objective reality. Reality is therefore a personal phenomenon, based 
on the consumers’ needs, want, values and personal experience. (Schiffman and Kanuk 
1978)
Consumers act on the basis of their perceptions, so it is important that marketers 
understand the concept of perception to readily appreciate what influence consumer 
decisions. Information is the primary raw material the marketer works with in 
influencing consumers. Therefore, the understanding of perception is critical in guiding 
marketing strategy (Hawkins, Best and Koney 1992). A customer's perception of a 
firm’s communication would influence his expectation and final judgement of the service 
encounter. Belch and Belch (1995) argue that marketers should particularly be interested 
in how consumers sense external information, how they select the various sources of 
stimuli, and how this information is interpreted and given meaning.
46
3.3.1 Perception Defined
Perception can be define as the process by which “an individual selects, organises, and 
interprets stimuli into a meaningful and coherent picture of the world” (Shiffman and 
Kanuk 1978, Philip Kotler et al 1996). Sensory inputs or stimuli such as advertisements 
are received by sensory receptors, (eyes, ears, nose, mouth and skin) which respond to the 
stimuli through a process known as sensation. The sensation so experienced by a 
customer could either be absolute or differential threshold.
Absolute threshold refers to the minimum amount of stimulation that can be detected on a 
sensory channel (Michael R. Solomon 1992). It is the lowest level at which an individual 
can experience sensation. According to Michael R. Solomon (1992) the differential 
threshold on the other hand refers to the ability of a sensory system to detect changes or 
difference between stimuli. Ernst Weber, a nineteenth-century German scientist argues 
that, the differential threshold also known as the just noticeable difference (j.n.d.) is not 
an absolute amount, but an amount relative to the first stimulus, (Schiffman and Kanuk 
1978). He (Ernst Weber) contends in what has become known as Weber’s law that the 
stronger the initial stimulus, the greater the additional intensity needed for the second 
stimulus to be perceived as different.
There are basically two levels of perceptions- supraliminal and subliminal perception, 
supraliminal perception refers to the perception of stimuli above the level of conscious 
awareness. On the other hand, subliminal perception according to Schiffman and Kanuk 
(1978) refers to a situation where the stimuli are too weak or brief to be consciously seen
47
or heard, but may nevertheless be strong enough to be perceived by one or more receptor 
cells. This is perception of stimuli below the level of conscious awareness. There is 
however considerable controversy as to the effectiveness or otherwise of subliminal 
perception.
3.3.2 Selective Perception
Michael Etzel et al (1997) maintains that consumers are exposed to an enormous amount 
of marketing stimuli everyday. However, through a process of selective perception, they 
are able to deal with the huge number of marketing stimuli in the commercial 
environment. According to Philip Kolter et al (1996), and Michael Etzel et al (1997), the 
process of selective perception comprises selective attention, selective distortion and 
selective retention.
However, according to Belch and Belch (1995), selective perception beings with 
selective exposure. This according to them, is the situation where a consumer decides 
whether or not to expose himself to information. For example, a consumer may decide to 
flip channels when an advertisement is being aired on a channel he is watching a 
television programme on.
Customers pay attention by exception (Michael Etzel el al 1997). They try to screen out 
most of the information they are exposed to, while concentrating on a selected few. 
Therefore, only those marketing stimuli that have the power to capture and hold the 
attention of the consumer have the potential of being perceived. This phenomenon is
48
called selective attention (Philip Kotler et al 1996, Belch and Belch 1995, Schiffman and 
Kanuk 1978).
Another component of selective perception is selective distortion. Belch and Belch 
(1995) refer to this process as selective comprehension. Marketing stimuli that may 
arrest the attention of a consumer may not necessarily be interpreted as the sender 
intended. Consumers fit incoming information into an existing mind-set and adapt the 
information to personal meanings. They interpret information based on their own 
attitudes, believe, motives and experiences. If the incoming information is inconsistent 
with the consumer’s frame of reference the information may be distorted to conform to 
the established believes. (Belch and Belch, 1995, Philip Kotler et al 1996, Michael Etzel 
et al 1997).
Selective retention is the third and final element of Selective Perception. After attending 
to and comprehending stimuli, consumers do not remember all the information they have 
seen, heard or read. They tend to retain information that support or reinforces their 
believes, attitudes and experiences (op.).
External stimuli (advertising, sales promotion, publicity and so on) and internal stimuli- 
(motives, expectations, beliefs, mood and learning) - interact to give an individual his or 
her unique perception of the world (Belch and Belch 1995). A customer’s perception of 
various marketing stimuli about a service would therefore influence his expectation about 
the service and his assessment of the quality of the service after an encounter.
49
3.4 CUSTOMER EXPECTATIONS
Customer expectations about service delivery, are beliefs that customers hold that serve 
as a standard reference point against which they compare their perceptions of 
performance. They hold different levels of expectations about service and these include 
desired service, adequate service and a zone of tolerance (Zeithaml and Bitner 2000).
Desired Service is the level of service the customer hopes to receive. It is a blend of what 
customers believe the level of service performance can be and should be. However, the 
“wish for level” of performance is not always possible. As a result, customers hold a 
lower level expectation for the threshold of acceptable service. This lower expectation is 
termed adequate service. It is the bottom level of performance that a customer would 
accept. It represents the minimum tolerable expectation.
Services are heterogeneous. Consequently, the extent to which customers recognise and 
are willing to accept this variation is termed the zone of tolerance, as depicted below. It 
is the difference between desired and adequate service.
50
Figure 3.2 Zone of tolerance
Source: Adapted from Zeithaml and Bitner, Services Marketing,Integrating Customer Focus Across the Firm, 2000, page 51
The zone of tolerance is the range within which customers do not particularly notice 
service performance. When Service performance exceeds the desired service level, 
customer is delighted. Customer perception of service quality will be low when service 
performance falls below the adequate service level.
The tolerance zone can expand and contract within the same customer for the same 
service at difference times. For example, a hotel customer will be less tolerant with a 
service employee at the checkout counter when the said customer is running late for his 
flight. The same customer will be more tolerant when he is checking out of the hotel in 
good time -  a couple of hours before his flight.
The zone of tolerance also varies for different service dimensions. The more important 
the factor, the smaller the zone of tolerance is likely to be, and the higher the desired and 
adequate service levels. Reliability is the most commonly cited service quality 
dimension. Customers are therefore likely to have a higher desired and adequate level of
51
service for reliability than other attributes, thereby narrowing the zone of tolerance for 
reliability, (Zeithaml and Bitner 2000).
3.4.1 Foundations of Customer Expectation
Expectations play a critical role in customer evaluation of service quality. A customer’s 
perception of the quality of a service is shaped by his expectations prior to the service 
encounter. It is therefore essential for marketers to understand and control the factors 
that shape these expectations. There are two broad categories of variables that shape 
customer expectations. These are uncontrollable and controllable factors.
3.4.2 Uncontrollable Factors Influencing Customer Expectations
Uncontrollable variables that influence customer expectations include word of mouth 
communication, personal needs, past experience, situational factors, enduring and 
transitional service intensifiers, perceived service alternatives and self-perceived service 
role.
Conditions that are necessary for the physical, functional, social or psychological well 
being of a customer are critical in shaping a customer’s expectations. Such personal 
needs affect the level of desired service. Also, what Zeithaml and Bitner (2000) called 
“enduring service intensifiers” (factors that are unique to a customer that influences his 
sensitivity to service) can influence customer expectation. An individual or a group of 
persons can drive a customer’s expectation. This is known as derived expectation, an 
example of an enduring service intensifier. For instance, a protocol officer’s choice of a
52
hotel for a firm’s foreign partners would be influenced by his perception of the partner’ s 
expectation of the lodging and boarding facilities. The other form of an enduring service 
intensifier is what is termed personal service philosophy (ibid.). A former restaurant 
waiter is likely to have a high expectation of service in any restaurant he patronises 
because of his personal attitude to and understanding of the meaning of service and what 
constitute a proper service conduct.
Transitory service intensifiers are a group of uncontrollable factors that also influence 
customer expectation. They are temporary and short-term individual factors that make an 
individual aware of the need for a service. Customer’s expectation of a service is further 
influenced by the ready availability of other alternatives, or his ability to satisfy his 
service need by himself. The degree to which a customer perceives the importance of his 
role in a service delivery process also affects his level of expectation. When a customer 
perceives he has not effectively played the role expected of him, his expectation would be 
low and the zone of tolerance would expand. Again, customer expectation will be low 
when customers perceive the situational factors (service performance conditions) to be 
beyond the control of the service provider.
Word of mouth communication and customer’s past experience are two of the most 
important uncontrollable variables that influence customer’s expectation. Word of mouth 
communication is personal and non-personal claims made by parties other than the 
service-providing firm. Word of mouth communication is perceived to be unbiased and 
therefore plays a critical role in shaping customer expectations. According to PR Smith
53
(1993), word of mouth communication is the most potent element of the marketing 
communication mix in one-to-one situations. Friends, family, colleagues and experts 
including consumer reports are all sources of word of mouth communication. Word of 
mouth communication tends to be very critical in services that are high in experience and 
credence qualities.
A Customer’s past exposure to services also influences his expectation for a current 
service being patronised. According to Zeithaml and Bitner, (2000) past experience may 
incorporate previous experiences with the particular service being patronised, the last 
brand purchased, or even the performance of a top selling brand or favourite brand. A 
customer’s expectation can also be shaped by the average performance he believes 
represent a similar category of product.
3.4.3 Controllable Factors Influencing Customer Expectations
Controllable factors that influence customer expectations lie within the controllable reach 
of the service firm. These are the marketing communication elements and include 
external marketing communication, interactive marketing and internal marketing. As a 
necessary background to reviewing literature on these concepts, the researcher will also 
take a look at some theories in communication, communication processes and response 
processes.
3.5 MARKETING COMMUNICATION
As noted above, communication is a major source of influence on customer expectation. 
Various writers and experts on communication have defined communications in different
54
ways. While some see communication as the passing of information, others see it as the 
exchange of ideas (Wilbur Schram, 1995). According to Churchill and Paul Peter (1995), 
communication is the element of the marketing mix that involves communicating with 
target markets to inform them about a product, service or idea and influence them to buy 
it. Sommers et al (1989) states that the word Communication is derived from 
“Communis”, a Latin word which means “Commonness”.
Thus in a communication situation, the initiator of the message seeks to achieve a 
“commonness” with the recipient through the use of various verbal and non-verbal 
symbols. Marketing communication therefore consist of every form of communication 
relevant to marketing (Tom Jerkins 1990). According to Dr. S. N. Buatsi (2000), 
marketing communication involves marketer-initiated techniques, which are directed at 
target markets in an attempt to influence attitude and behaviour.
Marketers use to plan and manage various promotional functions separately, sometimes 
with different goals and objectives. In the 1990s, however, many firms have begun to 
adopt the concept of Integrated Marketing Communication (IMC).
Integrating Marketing Communication involves co-ordinating the promotion mix 
elements along with other marketing activities that communicate with a firm’s customers. 
According to Belch and Belch (1995), these elements include advertising, direct 
marketing, sales promotion, publicity, public relations and personal selling. The
55
elements are either interactive marketing variables or external marketing communicating 
variables.
The American Marketing Association defined Integrated Marketing Communication as a 
“Concept of marketing communications planning that recognises the added value of 
comprehensive plan that evaluates the strategic roles of a variety of communication 
disciplines -  for example, general advertising, direct response, sales promotion and 
public relations -  and combines these disciplines to provide clarity, consistency and 
maximum communication impact”
P. Griffith Lindel observed in his article “ You Need Integrated Attitude to Develop 
IMC”, published in May 1997 in Marketing News that, IMC means that a firm’s public 
relations material say the same thing as the direct mail campaign, and advertising has the 
same look and feel as the web site. ’’Integrated Marketing Communication seeks to have 
all of a company’s marketing and promotional activities, project a consistent, unified 
image to the market place” (Belch and Belch, 1995).
Over the years, there has been a gradual shift from using advertising as the main 
promotional tool to using more of and integrating the other promotional mix tools. 
Marketers have come to realise that by strategically integrating and co-ordinating the 
various communication functions, they can take advantage of the synergy among the 
various communication tools to develop effective and efficient promotional programmes. 
Proponents of Integrated Marketing Communications have argued that it is the easiest
56
way of maximising return on investment in promotion (ibid.) The fragmentation of media 
markets, the changing media buying habits of companies who now take media buying in- 
house and the expensive nature of traditional advertising has served to increase interest in 
Integrated Marketing Communication (ibid.)
Marketing communication has changed over the years. In the past, customers received 
information about various products (both goods and services) from mass marketing 
sources such as television and newspapers. Zeithaml and Bitner (2000) maintain that 
customers of both goods and services receive information from a richer variety of sources 
including on-line sources and a host of other promotional tools. It has therefore become 
necessary to integrate and co-ordinate all these sources of information. Customers of 
services receive information from an even much richer sources including the servicescape 
and everyday service encounter with employees. To ensure that these messages are 
consistent among themselves and also with those sent through external marketing 
communication, there is the need for a third marketing communication variable- internal 
marketing. Zeithaml and Bitner (2000) called this Integrated Service Marketing 
Communication.
3.6 THE COMMUNICATION PROCESS
Due to the complex nature of the communication process, success in communication 
often depend on the nature of the communication, the channel used to transmit the 
message, the environment within which the message is received and how the receiver 
interpret such a message.
57
Over the years, various models have been developed in an effort to capture the various 
elements of the communication process. Each model provides an idea about the element 
of the process the particular researcher finds important. There is therefore no single 
model that all communication scholars agree on.
David Berio developed a model (SMCR model) which captured six elements (source, 
encoder, message, channel, decoder and receiver) that constitute the communication 
process. This model however does not recognise the importance of getting a response and 
feedback on the message sent. Likewise, it is silent on the effect of environment on the 
communication process. These elements were however incorporated into Wilbur 
Schram’s model, developed in 1955.
Fields of experience
Encoder Channel Decoding Receiver
Sender Message p -jp»
Feedback_________________________________________________________________________y
k  ^ Noise
---------------------------------------------------------- 4----------------------------------------------------
Figure 3.3 Wilbur Schram’s model of the communication process
Source: Adapted from Belch and Belch, Introduction to Advertising &
Promotion, An Integrated Marketing Communications Perspective,
1995, Page 154.
The third model for the purpose of this presentation is the 5-Ws model of 
communications (Harrold D. Lasswell 1948, pp 37-51). This model developed by
58
Lasswell contains the major elements that Wilbur Schram model captured, that is, source, 
message, channel, receiver and feedback. According to Lasswell, a communication 
process must answer five fundamental questions as to who (source) says what (message), 
in what way (channel) to whom (receiver) and with what effect (feedback).
Figure 3.4 Lasswell’s 5 -  Ws Model of communication 
Source: Adapted from S. N. Buatsi, Proceedings of the 7th International 
Conference on Marketing and Development, January 2000, Page 269
3.6.1 Elements of the Communication Process
The communication process consists of the initiator or source of the message, the process 
of encoding, the message itself and the response.
Source or Sender
The source or sender refers to the person or organisation that is involved in 
communicating a marketing message, directly or indirectly. A direct source is where a 
spokesperson endorsers or delivers a message about a product or service. Where
59
however, the spokesperson only draws attention to the product or enhances the advert, it 
is an indirect source.
The receiver’s perception of the characteristics of the source influences how the 
communication is received. Sources must therefore be credible, attractive and should 
have power (Herbert Kelman, 1961). They must have the relevant knowledge, skills, 
experience and be likeable (Belch and Belch 1995).
Encoding
Encoding is the process of putting thoughts, ideas or information into symbolic form. 
The words, signs, symbols, and pictures used must have a universal appeal, in order to be 
understood by the recipient.
Messages
The message is what is encoded and contains the meaning the source hopes to convey to 
the recipient. The message could be verbal, non-verbal, oral, written, unwritten or 
symbolic. It is important that messages are put into a transmittable form that is 
appropriate for the channel of communication being used. Marketers should consider not 
only the content of the messages but also how these messages would be structured for 
presentation and the message appeal to be used.
3.6.2 The Response Process
In developing a marketing communication programme, it is imperative that marketers 
understand the response process that receivers go through in arriving at a specific
60
behaviour. Marketers use promotional programmers to achieve various objectives at 
different times. In one instance, a marketer may seek to change receivers attitude and 
knowledge about a product or service, while at another time he may only want to create 
awareness about a product, brand or even company or idea (Belch and Belch, 1995).
Several models have been developed to illustrate the various stages receivers pass 
through to arrive at specific decisions. Figure 3.7 illustrates the Traditional Hierarchy
Response Models, which though similar, were developed for different reasons.
AIDA
MODEL
HIEARARCHY OF 
EFFECTS MODEL
INNOVATION 
ADOPTION MODEL
INFORMATION 
PROCESSING MODEL
CONGNITIVE
STAGE ATTENTION4-
AWARENESS
i
KNOWLEDGE4- AWARENESS4-
PRESENTATION4-
ATTENTION4-
COMPREHENSION
AFFECTIVE
STAGE
INTEREST
1
DESIRE
1
LIKING4-
PREFERENCE
I
CONVICTION
INTEREST4 -
EVALUATION4-
4-
YIELDING4.
RETENTION
BEHAVIOUR
STAGE
I
ACTION
4-
PURCHASE
TRIAL4-
ADOPTION
4-
BEHAVIOUR
Figure 3.5 Models of the response process
Source: Belch and Belch, Introduction to Advertising & Promotion, An
Integrated Marketing Communications Perspective 1995 page 164
The above response models view the response process as a movement through three basic 
stages- the cognitive, the affective and the behavioural stages. What a customer knows or 
perceives about a product or service is represented by the cognitive stage. The affective 
stage refers to the consumers’ feelings of like, dislike, preference, desire and conviction. 
The next stage, behavioural stage, refers to the customer’s action of trial, purchase,
61
adoption or rejection. These models therefore delineate the series of steps a potential 
customer must be taken through, from a state of unawareness of the product or service to 
when he develops affection for it and subsequently buys the product or patronises the 
service (Belch and Belch 1995).
3.6.3 Alternative Response Hierarchy
Over the past three decades, however, research in marketing, social psychology and 
communication has led to the questioning of the cognitive, affective, behavioural 
sequence of response. Michael Ray (1973) identified three different orderings of the 
traditional response hierarchies The standard learning hierarchy, the dissonance/ 
attribution hierarchy and the low involvement hierarchy.
Michael ray concluded that customers do go through the process depicted by the 
traditional response models. These stages correspond to learn, feel and do sequence 
which he termed the Standard Learning Model. He suggested that this model is 
applicable in situations where consumers are highly involved in the purchase process.
The dissonance / attribution hierarchy, or what he called, the do, feel and learn sequence 
of response, is the situation where customers would first purchase a product or service, 
then try to reduce any post purchase dissonance. They achieve this by attempting to 
develop positive attitude to the product or service, or develop a negative attitude to the 
rejected brands.
62
He suggested that where consumer’s involvement in the purchase process is low, the 
receiver might be depicted as moving from cognition to behaviour and to attitude change.
Topical Involvement
High L o w
Perceived
Product
Differentiation
High
Standard learning 
Model
Cognitive4-
Affective4-
Conative
Low Involvement 
Model
Cognitive
4-
Conative
4-
Affective
Low
Dissonance/ attribution 
model
ConativeI
Affective4-
Cognitive
Figure 3.6 Alternative response model.
Source: Belch and Belch, Introduction to Advertising & Promotion, An 
Integrated Marketing Communications Perspective, 1995 pp 168
Advertising and consumer researchers have recognised that neither the traditional nor 
alternative response hierarchies can explain all response patterns and behaviours (Belch 
and Belch 1995). In this light, Robert Smith and William Swinyard (1982) developed a 
revised interpretation of the advertising response sequence, which they called Integrated 
Information Response Model. This model integrated concepts from the traditional and 
low-involvement response hierarchy arguments. They incorporated the effects of direct
63
experience, arguing that advertisement and personal experience with a product or service 
resulted in different levels of belief strength.
They maintained that the sequence of response in a low involvement purchase might be 
cognition, trial and effect. In a high involvement purchase, however, the sequence of 
response would be similar to the traditional response hierarchy of cognition, affect, 
before commitment.
3.6.4 Cognitive Processing of Information
The hierarchical response process has been criticised on various fronts including it “black 
box nature”. Since the models do not explain what might be causing those responses. 
(Jerry C. Olson et al 1978).
Researchers have therefore developed several approaches to examine and understand the 
nature of cognitive reactions to persuasive messages. According to Belch and Belch
(1995), one of the most widely used methods is the Cognitive Response Approach 
(Anthony A. Greenwald 1968, Peter L. Wright 1973). This approach is used to examine 
receivers’ cognitive response. That is, the thoughts that occur to them while they read, 
view, or hear a communication.
According to the Belch and Belch (1995), researchers have identified three basic 
categories of cognitive responses. These are the product/ message thoughts, source- 
oriented thoughts, and adverts execution thoughts.
64
Figure 3.7 Cognitive response approach
Receivers thought are first directed at the product or service and the claims being made 
about them. If the receiver believes these claims, the message would generate support 
arguments, otherwise it would generate counter arguments. Negative thoughts (source 
derogation) or positive thoughts (source bolster) about the source of a message would 
influence the degree of acceptance or otherwise of that message.
Finally, this model suggests that the receivers’ thoughts have, when exposed to a piece of 
marketing communication may not concern the source or the claims about a product or 
service. They may rather be more interested in the advertisement itself and how it is 
being executed. Communicators are interested in receiver’s reaction because affective 
reactions are important in determining advertising effectiveness. Ronald Alsop (1986)
65
argued that people who enjoyed a commercial are twice as likely as those who are neutral 
toward the commercial to be convince that the brand is the best.
3.7 MARKETING COMMUNICATION VARIABLES
The elements of marketing communication lie within the controllable reach of service 
firms to use to shape customer expectation. As illustrated in figure 3.10 below, the 
customer of service can be reached through the application of various variables of 
external marketing communication and interactive marketing communication.
Figure 3.8 Reaching the service customer
With external communication, information flows from the service firm to the customer, 
and includes such traditional channels as advertising, sales promotion and direct 
marketing. Interactive marketing communication involves the messages that service 
employees give to customers as they interact during the production and consumption of 
the service, and it includes personal selling, service encounters and servicescapes. 
However, to enable the service employee to effectively interact with the customers,
66
communication from the company to the service employees must be accurate, complete 
and consistent with what the customer is hearing or seeing. This is internal marketing 
(see figure 2.11 below) and is made up of both vertical and horizontal communication 
(Zeithaml and Bitner 2000).
Interactive Marketing Personal selling Customer Service Centre Service Encounters Servicescape
Figure: 3.9 Marketing communications variables
Source: Adapted from Zeithaml and Bitner, Services Marketing,
Integrating Customer Focus Across the Firm, 2000, page 403
3.7.1 External Marketing Communication Variables
According to Philip Kotler (1991), external Marketing refers to the company’s efforts at 
preparing, pricing, distributing and promoting the service to customers, using a variety of
Employees
Internal Marketing Vertical Communication Horizontal Communication
External Marketing Advertising Sales Promotion Public Relations Publicity Direct Marketing Price
67
promotional tools. Through external marketing activities, a firm is able to make promises 
to its customers in respect of what to expect and how it will be delivered. These include 
advertising, sales promotion, public relations and publicity, direct marketing and price.
Advertising
Advertising is defined as any paid form of non-personal communication about an 
organisation, product, service or idea (Ralph S. Alexander, 1965). Philip Kotler, et al
(1996) defines advertising as any form of non-personal presentation and promotion of 
ideas, goods or services through mass media by an identified sponsor. The critical point 
of these definitions is that advertisement must be sponsored. An identified body or 
person must pay for it. It is non-personal, and therefore gives no opportunity for an 
immediate feedback.
Advertising uses the mass media - radio, television - to reach a larger audience and so is 
cost effective. It is usually designed to accomplish a specific task with a specific target 
audience during a specific period of time. Philip Kotler et al (1996) argue that there are 
four main types of advertisement designed to achieve various objectives. Advertisements 
could either be persuasive, that is, building a selective demand for a particular product or 
service, or informative, designed to build primary demand. Advertisement could also be 
designed to compare various products and services (comparison advertisement) or 
designed to keep customers thinking about a product or service- a reminder 
advertisement.
68
Sales Promotion
Belch and Belch (1995) defines sales promotion as “those marketing activities that 
provide extra value or incentives to the sales force, distributors, or the ultimate consumer 
and can stimulate immediate sales”. Sales promotion is therefore a mass-communication 
technique that offers short-term incentives to encourage purchase or sales of a product or 
service (Philip Kotler et al 1996).
Philip Kotler et al (1996) argues that sales promotion has become popular because of stiff 
competition and the fact that consumers are becoming more and more deal oriented. Sales 
promotion could either be consumer or trade oriented. Such promotional tools as 
sampling, premiums, rebates, contests, sweepstakes and various points of purchase 
materials (Belch and Belch, 1995) are used to entice consumers to try new products, lure 
customers away from competitors, hold and reward loyal customers or get customers to 
load up on mature products. (Philip Kotler et al 1996)
A second type of sales promotion is the trade oriented sales promotion. Promotional 
shows, merchandising allowances, price deals, sales contest, trade shows and buy back 
guarantees are some of the promotional tools used to encourage marketing intermediaries 
such as wholesalers, distributors and retailers to stock-up. (Belch and Belch 1995, Kotler 
et al 1996).
69
Public Relations
According to H. Frazier Moore and Bertrand R. Canfield (1997), public relations is “the 
management function which evaluates public attitudes, identifies the policies and 
procedures of an individual or organisation with the public interest and executes a 
programme of action to earn public understanding and acceptance”. Public relations tries 
to obtain favourable publicity, build up a good corporate image and handle or head off 
unfavourable rumours, stories and events in an effort to build good relations with the 
company’s various publics. (Philip Kotler et al, 1996). Public relations use a variety of 
tools such as publicity, publications, sponsorship of special events, fund raising, 
speeches, web sites and advertising to manage an organisation’s image. Traditionally, 
public relations are considered a supportive tool, rather than a primary part of the 
marketing communication process. However, Belch and Belch (1995) argue that many 
firms are now making public relations an integral part of their planned promotional 
strategies.
Publicity
Publicity has often been confused with public relations and advertising. However, as 
Belch and Belch (1995) observed, publicity is a “non-personal communication regarding 
an organisation, product service or idea that is not directly paid for or run under identified 
sponsorship”. Unlike publicity, advertising must be directly paid for by an identified 
sponsor. Again unlike publicity, public relations attempt to manage the kind of publicity 
a company gets. Publicity on the other hand is mainly concern with getting the media to 
cover a favourable story of a product, service, cause or event, to affect awareness,
70
knowledge, opinion and behaviour or attitude change. Companies use techniques such as 
press releases and conferences, feature articles, photographs, films and videotapes to gain 
publicity.
Publicity is cost effective and enjoys higher credibility than other forms of promotion, as 
the source is seen to be neutral and therefore unbiased. The biggest danger according to 
Belch and Belch (1995) is that publicity is not always under management’s control. As 
such, a negative or unfavourable story about a company and/or its product can be very 
damaging.
Direct Marketing
Direct Marketing according to Belch and Belch (1995) traditionally has not been part of 
the promotional unit. According to Mailrite, (www.mailrite.com/) a web based 
publication accessed on the 16th of February 2002 “in an age of increased competition, 
when people are inundated with thousands of different marketing messages everyday, 
traditional means of advertising have lost much of their impact”. Consequently 
companies have turned to direct marketing as an effective means of reaching their target 
markets. It has therefore become part of their integrated marketing communication 
programmes.
According to a survey carried out in Japan for the 1999 fiscal year, and published in a 
web site (www.Jadma.org/) the direct market industry in Japan recorded an estimated 
turnover of 2.27 trillion Yen. This represented an increase of 4.1% over the 1998
71
performance of 2.18 trillion Yen. This illustrates the growing importance of direct 
marketing.
In directing marketing, firms communicate directly with target customers to generate a 
response and or a transaction. Direct marketing is determining exactly who your target 
market is and applying focused marketing strategies there. (Belch and Belch 1995, 
www.Marketersnet.com/ Accessed on date 16/02/02). The use of such tools as direct 
selling, telemarketing, direct response adverts through direct mail and Internet sales 
allows direct marketing to be cost effective, efficient, targeted and fully tractable.
Though direct marketing is personalised and cost effective, customers re-act negatively to 
constant bombardment of sales information they are not interested in.
Pricing
Price goes with different names depending on the service being provided. For instance, 
consumers pay “Fare” for transport service, “Rent” for accommodation, “Fees” for 
tuition, “Rate” for utilities and “Income Tax” for the privilege of making money (Philip 
Kotler, 1991). Price, according to Philip Kolter et al (1996) is the amount of money 
charged for a product or service. It includes all the values that consumers sacrifice for 
the benefit of having or using the product or service.
According to Zeithaml and Bitner (2000), non-monetary costs may sometimes be more 
important concerns than monetary price in the demand of a service. The time a customer
72
spends in trying to patronise a service, the effort invested in identifying and selecting a 
service, and the inconvenience involved in using a particular service provider are all non­
monetary price customers pay for service. In addition to time, search and convenience 
cost, consumers may also suffer some anxiety or psychic cost in receiving some services. 
For example, the fear of not understanding an insurance policy or the uncertainty of 
having ones application for a bank loan rejected.
Service customers usually have limited knowledge about the prices of services. Because 
services are intangible and heterogeneous, firms can offer an infinite variety of 
combinations of services leading to a complex pricing structure. Also, service providers 
are sometimes unable and /or unwilling to estimate prices in advance as they might not 
know themselves what the services would involve.
Furthermore, unlike retail shops for products for example, services cannot be displayed 
together at a common point to enable prices to be compared. These, coupled with the fact 
that customer needs vary, and the prices of some services such as financial services are 
not visible, make it difficult for customers to have an internal reference price for services. 
(Zeithamal and Bitner 2000).
Firms use pricing to achieve various objectives. For instance, pricing could be used to 
maximise profits and to achieve a target return, on investments, (profit oriented goals), or 
to attempt to increase sales volume and maintain or increase market share (sales-oriented
73
goals). Pricing could also be used to maintain the status quo or meet the prevailing 
market price, (Michael Etzel et al, 1997).
The Relevance of Pricing
Irrespective of the objectives that a firm may seek to achieve with its pricing policy and 
strategy, price remains one of the most important elements that communicates to 
customers. It is the customer who decides whether the price of a product or service is 
right. Philip Kotler et al 1996, cautions that when prices are being determined, firms 
must consider consumer perceptions of price, and how these perceptions affect 
consumers’ buying decisions.
According to Zeithaml and Bitner (2000), price is an indicator of both costs and quality 
of service. When service cues to quality are readily available, such as brand name, 
company marketing communication and customers’ past experience, consumers might 
use them as indicators of quality. However, when such cues to quality are not readily 
available, or when it is the customer’s first experience, or quality is hard to detect, or 
quality and price vary a great deal within a class of services, consumers may consider 
price as the best indicator of quality.
In high-risk situations, many of which may involve services that are high in credence 
qualities, consumers consider price as a quality indicator because of the risk associated 
with the service purchase. Price therefore acts as a potent force in shaping customer 
expectation.
74
It is of critical importance that the prices of service are consistent with the value that 
customers perceive in the service. When monetary price is the most important 
determinant of value to a customer, a service firm should focus on price. Discounting, 
odd pricing, penetration and synchro pricing are some of the techniques that can be used 
to determine price.
According to Zeithaml and Bitner (2000), some services may possess desirable intrinsic 
attributes to a customer. A firm can therefore give such a service a premium price in an 
attempt to reflect the customer’s perception of value.
Market segmentation pricing and value pricing are varieties of pricing techniques used 
when customers perceive that the quality they get is directly related to the monetary price 
they pay. Zeithaml and Bitner (2000) argues further that such pricing strategies as price 
framing, price bundling, complementary pricing and results based pricing are various 
techniques used when a customer perceives that “value is all that I get for all that I give”. 
That is, the totality of monetary and non-monetary cost a customer sacrifices for what he 
perceives to be the entire benefits he receives from a service encounter.
Various external and internal factors influence pricing decisions. Marketing objectives, 
marketing mix strategies, and service costs are internal factors that impinge on pricing 
decisions. External variables such as the nature of the market, demand, competition and 
the economy also affect pricing decisions. (Philip Kolter et al 1996, Etzel et al 1997).
75
According to Philip Kotler et al (1996), and Zeithaml and Bitner (2000), there are 
basically three main approaches to pricing. Pricing could be driven by competitive 
considerations, demand considerations, or based on service cost.
Irrespective of what pricing policy, strategy or approach a firm adopts, and no matter 
what the external and internal influences may be, or the objectives the firm seeks to 
achieve, price remains an important element in shaping customer expectation. Thus, 
customers use price as a quality indicator. Service prices must therefore be carefully 
determined and chosen to convey the appropriate quality signal. This is especially so as 
services are dominated by experience and credence qualities.
3.7.2 Interactive Marketing Variables
While external marketing is concerned with making promises, interactive marketing 
ensures that those promises made are kept. Interactive marketing is the most critical from 
the customer’s point of view. Perceived service quality is influenced by the quality of the 
seller -  buyer interaction (Philip Kotler et al 1996).
According to Zeithaml and Bitner (2000), interactive marketing occurs when the 
customer interacts with the organisation, and the services are produced and consumed. It 
is this time that the customer perceives the organisation to have fulfilled or broken their 
promise made through the external marketing communication. Firms interact with their
76
customers through such channels as personal selling, customer service interaction, service 
encounters and servicescapes.
Personal Selling
Belch and Belch (1995) defined personal selling as “a form of person-to-person 
communication in which a seller attempts to assist and/or persuade prospective buyers to 
purchase the company product or service or to act on an idea”. Philip Kotler et al (1996) 
view personal selling as an oral presentation that is made with one or more prospective 
customers for the purpose of making a sale. This is made through a face to face contact, 
or through a form of telecommunication. Personal selling is the most effective tool in 
building up customers’ preferences, convictions and actions (ibid.).
According to Belch and Belch (1995) personal selling allows the seller to target specific 
markets and customer types, obtain immediate and precise feedback, modify the sales 
message in response to the potential buyers reaction, and to tailor the message to the 
customers specific needs or situation. Personal selling is however very expensive. 
Maintaining a sales force require a longer-term commitment. According to Philip Kotler 
et al (1996) personal selling is the most expensive promotion tool.
Customer Service Centres
Customer service centres are another means by which customers interact with service 
providers. Customer service centres as used in this study refer to points that are 
purposely set up by service providers to handle specific customer related issues. Such
77
centres may handle issues ranging from making enquiries, reporting service failure, 
settling bills, to receiving activity or transaction statements and making new orders.
Every encounter at the service centre is a communication process and provides an 
opportunity for customers to evaluate service quality. It is therefore essential that 
communication procedures are clearly set out, processes are customer friendly, and 
employees are committed to customer service (Dirk Zeller, 2002, ACA Group 2002). 
According to Dirk Zeller (2002) most customers equate consistency of communication 
with customer service.
Service Encounters
“From the customers point of view, the most vivid impression of service occur in the 
service encounter or the moment of truth when the customer interacts with the service 
firm” (Zeithaml and Bitner 2000) Service encounters have therefore been termed the 
building blocks of satisfaction and service quality.
A customer experiences several moments of truth from the first contact with the service 
employee (for instance, checking in at a hotel) to the last moment, (checking out of the 
hotel). Zeithalm and Bitner (2000) observe that one could think of the linking of “these 
moments of truth” as a service encounter cascade.
Each moment of truth is an opportunity for a firm to prove it’s potential as a service 
provider. Many positive encounters add up to a composite image of high quality. Many
78
negative experiences will however have a negative effect on customers’ perception of 
service quality. Not all encounters are equally important in building up an image of 
service quality. For every firm, certain encounters will be key to (contribute more 
towards) a customer’s satisfaction than others. Zeithaml and Bitner (2000) argues that 
some momentous encounters that go wrong could drive away customers irrespective of 
what positive encounters occurred in the past.
There are three (3) types of service encounters, (Zeithaml and Bitner 2000). Service 
encounter can occur without direct human contact, such as withdrawing money through 
an ATM. This is referred to as remote encounter. Tangible evidence of the service and 
the quality of the technical process and system influence service quality perceptions.
Service encounters through the use of phone or phone encounters are the second type. A 
third type, face-to-face encounters are the encounters that occur between a service 
employee and a customer in a direct contact. Tangible cues, verbal and non-verbal 
behaviours are important determinants of service quality in face to face encounters. The 
customers own behaviour during the interaction also plays a role in creating quality 
service.
Servicescapes
Servicescape is one of the critical components of interactive marketing. Because of the 
intangibility of services, customers often rely on tangible cues to evaluate the service 
before, during and after consumption. Servicescapes according to Zeithaml and Bitneer
79
(2000) “is the environment in which the service is delivered and where the firm and the 
customer interacts”. Elements of the servicescapes include the exterior and interior 
designs, equipment, layout, landscape, surrounding environment, signage, parking, and 
such ambient conditions as temperature, colour, noise and air quality. (Zeithaml and 
Bitner 2000, Donna J. Hill, 2000). Business cards, stationery, billing statements, 
uniforms and employee dress, reports, brochures and internet web-sites are other 
tangibles that also communicate with customers. These other tangibles together with the 
servicescape make up physical evidence, an important aspect of service marketing 
communication and service marketing. Elements of servicescape communicate about and 
facilitate performance of service.
The use that the servicescape is going to be put, and how complex the service delivery 
environment would be, will influence the type of servicescape to adopt. According to 
Zeithaml and Bitner (2000), servicescapes may be designed to suit self-service situations 
where customers perform most of the activities and few employees if any are involved. 
An example is ATM and Internet services. Servicescapes could also be designed to suit 
employees only, especially in cases of remote services. However, in Banks, hospitals, 
hotels, and the like, servicescapes would be designed to enhance employee customer 
interaction.
Some service delivery situations may require very few elements and equipment, for 
instance ATM. In such lean service environments, design decisions are relatively
80
straightforward. However, in hospitals and hotels where service is delivered in quite an 
elaborate environment, servicescape designs would be much more detailed and complex.
Roles of Servicescape
Servicescape, like the packaging of a tangible product, serves as a visual metaphor and 
conveys an external image of the service to consumers. The outward appearance of 
contact personnel also has an impact on the packaging role of servciescape. Zeithaml and 
Bitner (2000) maintain that a well designed and functional facility should serve as a 
facilitator in aiding the performance and interactions of both employees and customers.
Servicescape aids in socialisation by helping to convey expected roles, behaviours, and 
relationships. They also differentiate one service provider from another and thereby give 
an indication of the market segment the services are intended for. In hotels for example, 
the design of the physical setting is used to differentiate one area of a service from 
another, (dinner room differentiated from conference room) or different sizes of rooms 
with different levels of amenities attracting different prices.
The perceived servicescape according to Zeithaml and Bitner (2000) can influence a 
person’s belief about a place, and the products and people in that place. It can directly 
elicit emotional responses that in turn influence behaviours.
81
There are three environmental dimensions that affect people’s beliefs, emotions and 
physical responses. Zeithaml and Bitner (2000) identified them as ambient conditions, 
which include the background characteristics of the environment such as lighting, noise, 
music, scent and colour that affect the five senses. Spatial layout and functionality is the 
second dimension. It refers to the size, shape and arrangement of machinery, equipment 
and furnishing, and the ability of these items to facilitate the accomplishment of both 
customer and employee objectives. Signs, symbols and artefacts also serve as implicit or 
explicit signals that communicate about the place and it’s users and affect behaviour. 
They are particularly important in forming first impressions, communicating new service 
concepts, repositioning and differentiating service.
When physical evidence is well researched, planned and implemented, critical problems 
such as miscommunication or over-promising that lead to poor service quality can be 
avoided.
3.7.3 Internal Marketing Variables
The third variable of marketing communication is the internal marketing, which is 
concern with enabling promises to be fulfilled (Zeithaml and Bitner 2000). To enable 
service systems to deliver as promised, service employees must be equipped with the 
necessary tools, skills and abilities, and motivated to deliver.
According to Zeithaml and Bitner (2000), internal marketing works on the assumption 
that customer and employee satisfaction is inextricably linked. Internal marketing must
82
be managed such that communications flowing from the company to service employees 
are accurate, complete and consistent with what customers might have been exposed to in 
both the external and interactive marketing.
Internal marketing communications is both Vertical and Horizontal. Vertical 
communications are either downward, that is, information flowing from management to 
employees, or upward, information flowing to management from employees. Vertical 
communication is normally seen as formal communication. Downward communication 
includes directives, policies, procedures, rules and regulations and queries. Reports, 
complaints, responses and request are some of the types of information that are contained 
in upward communication.
Horizontal communications are communications that go across functional boundaries in 
an organisation. Horizontal communication does not follow a chain of command. It is 
essentially the flow of information between colleagues and peers.
An effective co-ordination and communication between various departments such as the 
advertising, marketing, operations, sales and human resource departments are critical in 
delivering services that meet customer expectations.
3.8 CONCLUSION
From the foregoing literature review, service quality assessment has been demonstrated 
to be a personal phenomenon, which differ from one customer to another. Customer 
judgment (perception) of the quality of a service encounter depends largely on what the
83
customer expected to experience from the said encounter. His perception of quality is 
therefore depended on his prior expectations. Expectation serves as the background 
against which the customer judges the entire service experience. The way the customer 
perceives the service encounter will determine how the said customer will assess the 
quality of the service he has experienced.
Figure 3.10 below clearly depicts the relationship between the key dimensions captured 
in the conceptual framework and literature review.
Figure 3.10 Linkages Between The Key Dimensions
ft/1
Customer expectation is influenced by marketing communication variables. Marketing 
communication variables lie within the controllable reach of the service firm, and can be 
used to shape customer expectation.
It must be noted however that there is a second set of variables (non-marketing 
communication variables) which lie outside the controllable reach of the service firm that 
also influence customer expectation. They include, word of mouth communication, 
personal needs and past experience. The service firm cannot however easily influence 
these variables to achieve its objectives.
85
References
1. Michael J. Etzel, Bruce J. Walker, William J. Stanton, Marketing, 1997, New 
York, Irwin McGraw-Hill,
2. Valerie A. Zeithaml and Mary Jo Bitner, Services Marketing:
Integrating Customer Focus Across the Firm, 2000, New York, Irwin McGraw- 
Hill
3. Philip Kotler, Gary Armstrong, John Saunders and Veronica Wong, Principles of 
Marketing, The European Edition, 1996, London, Prentice Hall.
4. William J Stanton, Fundamentals of Marketing, 1981 McGraw Hill, New York
5. http://www.ggallagher.co.uk/perception/ Date of 25/10/01
6. Dr. Rakesh Khurana, Dr. Madhulika Kaushik, Kamal Yadava, Marketing of 
Services, Concepts Applications, 1993, New Delhi, Sona Printers Pvt. Ltd.
7. http://www.qualitydigest.com/ Date of entry: 12/01/02
8. http://www.macfadden.mit.edu:9500/ Date of entry 12/01/02
9. http://www.alidoro.emeraldinsight.com/ Date of entry 21/09/01
10. Journal of Business and Industrial Marketing, Vol.13 No. 4/5 1988, pp 322-338,
MCB University press, 0885-8624.
11 Lehtinen U., Lehtinen J.R., Service Quality: A study of Quality Dimensions, 
Service Management Institute, Helsinki, 1992.
12 http://www.Imt.za/qrater Date of entry 22/10/01
13 http://www.Is.unc.edu/ Date of entry 12/10/01
14 http://www.arl.org/libqual/ 15/10/01
15 http://www.apri.ac.nz/ Date of entry: 22/10/01
16 Leonard L. Berry and A. Parasuraman, Marketing Services Competing through 
quality. The Free Press, a division of Macmillan, Inc, New York.
17. William J. Me Guire, An Information Processing Model of Advertising 
effectiveness” in Behavioural and Management Science in Marketing ed. Harry J. 
Davis and Alvin J. Silk (New York: Ronald Press, 1978) pp 156 -80
18. Philip Kotler 1991 “Marketing Management” Analysis, Planning, implementation 
and Control, Englewood Cliffs, New Jersey Prentice -  Hall, Inc.
19. http://www.newark.rutgers.edu/ Date of entry: 19/02/02
86
20. Dr. S. N Buatsi, January 2000, Proceedings of the 7th International Conference on 
Marketing and Development, University of Ghana, Accra
21. http://www.mailrite.com/ Date of entry: 16/02/02
22. Lean G. Schiffman and Leslie Lazar Kanuk, 1978, "Consumer Behaviour" 
Prentice-Hall, Inc. Eaglewoods cliffs, New Jersey.
23. http://www.jadma.orgele-page/ Date of entry: 16/02/02
24. http://www.web-source.net/ Date of entry: 16/02/02
25. http://www.marketersnet.com/ Date of entry: 16/02/02
26. Philip Kotler, et al 1996, Principles of Marketing 
The European Edition, Prentice Hall Europe, London
27 http://www.realtytimes.com/ Date of entry: 22/02/02
28 http://www.thecagroup.com/ Date of entry: 22/02/02
29. G.E Belch and M. A Belch, 1995, Introduction to Advertising and Promotion, An 
Integrated Marketing Communication Perspective, New York, Irwin
87
CHAPTER 4
4.0 METHODOLOGY
4.1 SAMPLING DESIGN
Due to the nature of the research topic and research questions, the researcher incorporated 
a mixture of open and close-ended questions in 3 sets of questionnaires. The population 
for the study included Executive Management, Service Employees and Clients of the 
hotel industry in Ghana. The questionnaires were therefore administered in a survey to 
various stakeholders in the industry, namely, management, service employees and clients.
The sample for the study included Executive Management, Front-line Staff and 
Customers of all 4 and 5 star rated hotels, and a number of 2 and 3 star rated hotels within 
the Greater Accra Region of Ghana. The Executive Management, relevant Front-line 
Staff and Customers of these hotels were sampled. A total number of 318 customers 
were interviewed. One executive manager and two front-line staff of each of these hotels 
were also interviewed. However, only one front line staff each responded in two of the 
hotels.
The Executive Management group was selected to throw light on company policy and 
practice of marketing communication. The customers were the focus of the study. 
However, the Front-line Staff were also sampled to enable the researcher determine how
the firms marketing communication policies operated in practice, the difficulties service 
employees experienced and it’s impact on customers.
The 3 to 5 star categories of hotels were chosen (only two of the 2 star rated hotels were 
sampled) because they serve the upper end of the market. Consequently, due to 
competition and customer demands these hotels have one form of marketing 
communication policy or another. Out of 23 (3 to 5 star) hotels operating in Ghana 
currently, 14 (60%) operate in the Greater Accra Region alone. This informed the 
researcher’s decision to choose the Greater Accra Region as the sample population area.
4.2 RESEARCH DESIGN
The study made use of both primary and secondary data. Secondary data sources are 
mainly published material, that is, books, magazines and material on the World Wide 
Web. A thorough review of services marketing literature in respect of service quality, 
perception and customer expectations were done. Marketing communication theories 
were also reviewed. These helped the researcher to develop a practical and theoretical 
framework based on which survey questionnaires were designed. The researcher 
reviewed a lot of material from Belch and Belch (1995) and Zeithaml and Bitner (2000) 
which he found very useful. Extensive use was made of material from the net, which had 
current and relevant material on the research topic.
Primary data consisted basically of data gathered from the field. Questionnaires were 
designed to conduct a survey on target groups. The customer group was selected on the
89
basis of convenience. Three types of questionnaires were administered. The Executive 
Management of the hotels included in the survey had one set of questionnaires developed 
exclusively for their use. Another set was developed for the front-line staff of those 
hotels, while a different set was administered on customers.
4.3 DATA COLLECTION
Three field Officers that the researcher had worked with before in various capacities were 
selected and trained for an hour before being despatched to administer the questionnaires 
to the customer group. The researcher himself handled the front-line staff and the 
executive management group.
The researcher interviewed the executive management group and completed the 
questionnaires with answers provided by the respondents as the interview progressed. 
However, some executive managers preferred to answer the questionnaire by themselves 
and submitted them later. This was conducted through face-to-face contacts, as indeed 
was the case with the questionnaires for the Front-line Staff.
Prior appointments were made with the Management of each hotel before the interview 
with an executive management staff was conducted. Front-line staff were however 
contacted individually and given the questionnaires to complete by themselves. The 
researcher collected them back after a week. The researcher delivered these 
questionnaires in person to each individual respondent.
90
The questionnaires, which contained both open-ended and close-ended questions, were 
administered to a minimum of (15) customers per hotel. 18 hotels were targeted. 
Without prior arrangement with management, the field Officers visited the various hotels 
and interviewed customers who were willing to respond. Respondents were selected on 
the basis of convenience, a non-probability sample.
No reward in kind or monetary value was given to anybody or solicited by any person 
from any of the targets groups. They all appreciated a polite thank you.
The fieldwork lasted three (4) weeks in all.
4.4 DATA ANALYSIS
The questionnaires were first of all checked for incomplete responses, and then collated 
and coded. The data was organised and summarised in a manner that will make it easy to 
analyse and interpret the results. The study made use of graphs, tables and pie chart to 
analyse the data. This will help readers get a vivid picture of the results of the study.
The researcher explored the confirmation- disconfirmation paradigm and therefore 
adapted questions from the SERVQUAL measuring instrument. This enabled the 
researcher to analyse the relationship between customer pre-purchase expectations and 
their perception of service performance.
91
By the use of various graphs, charts and tables, the researcher was able to effectively 
analyse the collected data in the light of the stated research questions and objectives. 
Conclusions were drawn and recommendation made on the strength of the data collected 
from the field.
4.5 LIMITATIONS OF THE STUDY
Due to time and financial constraint, the study covered mainly hotels rated three, four, 
and five stars in the Greater Accra Region of Ghana. This was not representative enough 
as it did not cover all categories of hotels, and did not represent all the regions of Ghana.
Respondents were selected on the basis of convenience, a non-probability sampling 
technique. This could have affected the data collected since the sample was not 
representative.
The hotel industry in Ghana has a large customer base. Therefore, the sample size of 318 
used is small. The margin of error could therefore be high.
The field of experience and individuality of the researcher himself could also impact on 
how the data is analysed and interpreted.
92
References
1. Valerie A. Zeithaml and Mary Jo Bitner, Services Marketing:
Integrating Customer Focus Across the Firm, 2000, New York, Irwin McGraw- 
Hill
2. G.E Belch and M. A Belch, 1995, Introduction to Advertising and Promotion, An 
Integrated Marketing Communication Perspective, New York, Irwin
3. Ghana Tourist Board Directory, 2000
4. P. A Twumasi, 2001, Social Research in Rural Communities, Accra, Ghana 
Universities Press
5. J. Y Opoku, 2000, A Short Guide to Research writing in the Social Sciences and 
Education, Accra, Ghana Universities Press
6. Tom K. B Kumekpor, 1999, Research Methods and Techniques of Social 
Research, Accra, SonLife Press and Service
93
CHAPTER FIVE
5.0 DATA PRESENTATION AND ANALYSIS
5.1 INTRODUCTION
With the aid of tables, graphs and charts, the researcher will present and analyse the data 
gathered from the field. These techniques of description statistics will help readers get a 
vivid picture of the results from the study. The data will be analysed in the light of the 
research questions and objectives of the study as stated in chapter one, and will be 
discussed under the following headings.
• The influence of firm level communication on customer expectations.
• The effect of customer expectations on perception of service quality
• The integration of firm level communication and its influence on customer perception 
of service quality
• Over promising or exaggerating service and it’s impact on quality perceptions
• The most important factor that influence customer expectation in any service 
encounter.
94
5.2 BACKGROUND OF SAMPLE STUDIED
All 5 star and 4 star rated hotels and a number of 3 star and 2 star rated hotels in Accra 
were selected to participate in the study. A total of 18 hotels were targeted and 14 hotels 
responded. All 5 star and 4 star rated hotels responded.
Table 5.1 Composition of hotels interviewed
Hotel rating Number of hotels interviewed Percentage composition of hotels interviewed5 star 2 14.29%4 star 2 14.29%3 star 8 57.13%2 star 2 14.29%
Questionnaires were distributed to 28 front line staff of these hotels out of which 26 
responded. Questionnaires were also distributed to 400 customers and 318 people 
completed the questionnaires. Respondents were selected on the basis of convenience, a 
non-probability sample. In all cases, respondents took the questionnaires, completed and 
^returned them to the interviewers. However, with some executive management staff, the 
researcher conducted the interview and completed the questionnaire himself as the 
interview progressed. This was at the request of management.
Table 5.2 Response rate to questionnaires
Category of respondents Targetedrespondents Responses received Percentage (%)Hotel management 18 14 77.78%Front line staff 28 26 92.86%Customers 400 318 79.50%
The response rate of the questionnaires was high.
95
5.3 THE INFLUENCE OF FIRM LEVEL COMMUNICATION ON 
CUSTOMER EXPECTATION
As observed in chapter three, customer expectation of service quality is influenced by the 
messages that the said customer has been exposed to. In the study, 318 people were asked 
to indicate if they had any prior expectations before using the services of the hotel, and 
246 (77.36%) people indicated they did. 73.59% had very high or high expectation, 
while only 3.77% had low expectation. See table 5/3 below.
Table 5.3 Levels of expectations
Level of Expectation Number of Response Percentage (%)Very high 132 41.51%High 102 32.08%Low 12 3.77%No expectation 72 22.64%
In an attempt to determine what influenced their expectation the 246 respondents were 
asked to indicate those factors that were responsible in building up their expectations. 
They were asked to choose as many factors as was applicable to them as indicated in 
table 5.4 below
96
Table 5.4 Factors influencing customer expectation.
Variables influencing customer expectation Number of Response Response in percentagesPersonal needs 66 13.20%Prior contact with Staff 24 4.80%Prior contact with friends, family, colleagues (word of mouth) 42 8.40%Promotions 66 13.20%Image of Hotel 146 29.20%Hotel charges (price) 144 28.80%Other source 12 2.40%
As illustrated in table 5.4 above, 29.20% of responses indicated that the image of the 
hotel was the primary factor that built up their expectations. This was followed by price 
and promotions, which had a response rate of 28.80% and 13.20% respectively. In 
respect of the first objective of this study it can be concluded from the foregoing analysis 
that firm level communication directly influences customer expectations.
However, it is worthy to note that as Zeithaml and Bitner (2000) observed, there are 
uncontrollable factors that also influence customer expectation. From Table 5.4 above, it 
can be observed that personal needs had the same responses (13.20%) as promotions. 
Word of mouth and prior interactions with staff together also had 13.20% responses. 
Both of these factors (word of mouth and personal needs) are beyond the controllable 
reach of the firm.
5.4 THE EFFECT OF EXPECTATIONS ON CUSTOMER PERCEPTION OF 
SERVICE QUALITY
As stated in chapter three, customer expectation about service, are beliefs they hold that 
serve as a standard reference point against which they compare their perceptions of
97
performance. (Zeithaml and Bitner, 2000). Customers assess the quality of any service 
encounter based on certain quality dimensions. The service marketing literature identified 
ten service quality dimensions that were later consolidated into five dimensions. In the 
study, sixteen variables were developed based on these service quality dimensions and 
respondents asked to indicate, as many as was applicable, whether the service encounter 
met, exceeded or fell short of their expectations.
Table 5.5 Service quality dimensions and customer perception.
Variables ExceededExpectations MetExpectations Fell short of expectations Ranking- expectation scoreAttractive and convenience of physical facilities. 72 216 • 30 2.1321Staff appropriately dressed 54 246 18 2.1132Polite, pleasant and considerate staff 108 162 6 2.0566Demonstrate understanding and concern for your needs 84 186 18 2.0189Staff willingness to answer questions 72 198 18 1.9811Staff communicating in an easy to understand language 78 186 18 1.9623Staff know what they are about 72 192 18 1.9434Service performed right first time 24 252 18 1.8679On time delivery 54 180 66 1.8491Convenient location of service access points 72 168 36 1.8491Exact specs. 54 180 54 1.8113Flexibility inaccommodating your needs 66 168 42 1.8113Personal security 102 120 24 1.7925Quick responds to your demand 30 198 72 1.7547Ease in reaching the appropriate staff 48 180 36 1.6981Confidentiality of records 72 132 12 1.5472TOTAL RESPONSES 1,062 2,964 486PERCENTAGE RESPONSES 23.54% 65.69% 10.77%
98
The attractiveness and convenience of the physical facility was ranked highest with a 
score of 2.1321. This was followed closely by how appropriately the staff dressed and 
how polite, pleasant and considerate they (staff) were. These variables had a score of 
2.1132 and 2.0566 respectively. The ease with which the appropriate staff was reached 
and how confidential records were kept had the lowest ranking with a score of 1.6981 and
1.5472 respectively.
It is worthy of note from Table 5.5 above that, the physical appearance of the hotel and 
the staff, as well as how the staff interacts with the service customer had the highest 
score. It could be deduced therefore that since over 73% were satisfied with the service 
experience (see Table 5.6 below), these factors contributed significantly to the customer 
perception of service quality. Similarly, confidentiality of records, ease in reaching the 
appropriate staff, quick response to demands and personal security had the lowest score, 
and therefore did not contribute very much to service quality perception.
Management of service firms should therefore ensure that there are no discrepancies 
between what is communicated to the customer and what he experiences in a service 
encounter. This is especially so for those variables that impacts heavily on customer 
perception of service quality. Though personal security did not have a high expectation 
score, in other parts of the world, especially the USA and Western Europe, personal 
security may score very high. This is because of the experiences of September 11, 2001 
tragedy in the USA, and “terrorist” attacks in other parts of the world such as Spain and 
Northern Ireland.
99
Respondents were asked to judge the quality of service in the light of their experience,
and level of satisfaction in respect of the above service quality dimensions. 26.41%
judged the service quality to be very high, 47.17% assessed the service quality as high,
24.52% as average performance, and 1.9% as poor quality service.*
It is interesting to note from Table 5.6 below that, only 1.9% of the respondents thought 
the quality of service was poor, though as much as 10.77% (see table 5.5 above) indicated 
that the service experience fell short of expectations. Similarly, 26.41% of respondents 
assessed the service quality to be very high, even though only 23.41% of responses 
indicated that their expectations were exceeded. This points to the fact that there are 
intervening variables that are largely uncontrollable and that come to play when 
customers are assessing service quality.
Table 5.6 Degrees of Service Quality.
Level of Quality Responses
Very high 26.41%
High 47.17%
Average 24.52%
Low 1.90%
5.5 THE INTEGRATION OF FIRM LEVEL COMMUNICATION AND IT’S 
INFLUENCE ON CUSTOMER PERCEPTION OF SERVICE QUALITY:
It was noted earlier in chapter one that customers of services today are exposed to 
messages coming from a wide range of sources. Consequently there is a potential for 
messages from various promotional tools to conflict. Messages may also conflict with
internal operating procedures, and various departments of the same service provider may 
operate at cross-purpose if there is no effective internal marketing.
5.5.1 Integrating Firm Level Communication
In the study, the management of 14 hotels was asked to confirm whether all their 
promotions made the same claims and whether there were any official policies to ensure 
this was so.
Though all 14 respondents indicated that all their promotional efforts were integrated, 
only 10 hotels (71.42%) confirmed that there was official policy framework to ensure that 
all promotional efforts were coordinated. However, even those hotels that claim not to 
have any policy framework do in fact make conscious efforts at coordinating their 
promotional activities. For instance, one hotel noted that “though we do not have any 
specific policy document, all our promotional activities are consciously geared towards 
making common claims”.
The 10 hotels mentioned in the preceding paragraph indicated that the integration of their 
marketing communication efforts has had positive effects on customer perception of 
service quality. However, when they were asked to indicate whether or not they have had 
instances where customers complained about conflicting promises and claims made 
through various communications channels, two hotels confirmed they had had such 
experiences. Both hotels also confirmed that such experiences had a negative effect on 
the quality perception of their service to such customers.
101
5.5.2 Coordinating Internal Marketing 
Management Perspective
The management of the hotels included in the survey were asked to confirm how 
efficiently they handled their internal marketing. They were to indicate whether 
marketing, service employees, or backstage staff had ever complained about not 
understanding or being in the know of what the other department was doing. The table 
below demonstrates the results obtained from the study.
Table 5.7 Coordinating internal marketing
Questions Yes (Number of responses)
Yes (%) No(Number of responses)
No (%)
Backstage staff fully aware of promises and claims marketing makes 10 71.43% 4 28.57%Backstage staff fully understand the promises and claims marketing makes 12 85.71% 2 14.29%Backstage staff fully aware of front line staff expectations on them 12 85.71% 2 14.29%
To a very large measure (71% and 85%) the departments coordinated their efforts. In 
instances that internal marketing was not properly coordinated it affected service quality 
adversely. However, 50% of respondents said this had no effect on service quality 
perceptions because the problems that arose were quickly resolved. It is significant to
102
note however that all respondents accepted that this situation did not have any positive 
impact on service quality either.
Furthermore 28.57% of respondents confirmed that they received complaints from front 
line staff who claimed they were not in the full know of the promises marketing makes. 
They also received complaints from backstage staff who claimed they did not know in 
good time what was expected of them. Respondents were unanimous (100%) that such 
situations had negative effects on the quality perception of their services. This confirmed 
our third research questions as stated in chapter one which sought to know whether 
inadequate internal marketing will lead to a poor perception of service quality.
Staff Perspective
From the perspective of the front line staff, service quality can be adversely affected 
when service employees are not adequately briefed, do not understand claims made, or 
are all together not in the know of the promises and claims the hotel makes.
For instance, in the study, 26 front-line staffs were asked whether they are always in the 
know of claims and promises the hotel made. Out of 26 respondents, 30.77% confirmed 
they were not always aware of claims and promises the hotel makes. They were further 
requested to indicate the following as illustrated in table 5.8 below.
103
Table 5.8 Customer complains
Questions Yes responses No responsesHave customers ever confronted you about claims and promises you did not know about. 8 (30.77%) 18 (69.23%)Have customers ever confronted you about claims and promises you were not adequately briefed about
16 (61.54%) 10 (38.46%)
These complains have a negative effect on service quality perception as indicated by 
53.85% of respondents and confirms the third research question.
Customer Perspective
The views of the 318 consumers in the study were sought as to whether they had noticed 
inconsistencies in messages they had received from the various promotional tools.
11.54% answered yes out of 312 people who responded. 36.54% also confirmed that 
they had noticed inconsistencies between some claims and promises and the services they 
experienced on the ground.
37% indicated that such inconsistencies negatively affected their perception of the service 
quality. However, 51.85% confirmed that, the service failure was immediately recovered 
and so had no effect (adversely or otherwise) on service quality. The results confirm that, 
when firm level communication is not integrated to present a consistent and unified front 
it will adversely affect customer perception of service quality.
104
5.6 OVER PROMISING THE SERVICES OF A FIRM AND ITS IMPACT ON 
SERVICE QUALITY PERCEPTIONS.
Over promising the services of a hotel adversely affects service quality perceptions. 
Unfortunately however, in a bid to attract customers to patronise their services, firms 
exaggerate what they can deliver.
Management Perspective
The management of 14 hotels was asked to indicate whether they had made claims that 
they knew could not be met. Only two hotels confirmed this. Again, only two hotels 
agreed that they had made claims that when clients attempted to access the said claims 
the hotel was not ready to provide it.
They were further asked to indicate whether customers complained about services that 
could not be met, and or services that were not available at a particular time as promised. 
Eight hotels confirmed the former, while two hotels confirmed the later. Two hotels 
further indicated that their front line staff members had also complained to them about 
promises made but were not available at the time promised. 50% of the hotels agreed 
that these complaints had a negative impact on the perception of the quality of their 
service.
Customer Perspective
Customers were asked to indicate whether their experience of the following variables 
were the same as promised in the hotel’s marketing communications or not.
105
Table 5.9 Comparing the promise and actual experience of selected variables
VARIABLES There are discrepancies There are no discrepanciesProcedures and regulations 30% 70%Services available 26% 74%Service flexibility 22% 78%.Speed of delivery 25% 75%Staff understanding of your needs 28% 72%
An average of about 74% confirmed that there were no discrepancies between what they 
had experienced and what they had learnt through the hotel’s marketing communication. 
67.92% agreed that the hotels kept their promises; and 59.57% agreed that the hotels 
keeping their promises had positively influenced their perception of the service quality.
About 32% of respondents thought the hotels did not keep their promises, about 26% 
thought the hotels promised more than they delivered, and 23.4% confirmed this 
adversely affected their service quality perceptions.
As was postulated in the first research question in chapter one, it has been demonstrated 
in the foregoing discussions that the more a customer perceives the hotel to be meeting its 
promises, the higher the service quality would be for the said customer.
5.7 THE MOST CRITICAL FACTOR THAT INFLUENCES CUSTOMER 
PERCEPTION OF SERVICE QUALITY IN A SERVICE ENCOUNTER
In chapter 3, it was observed that though a satisfactory final outcome is essential for a 
service experience to be judged as high quality, perception of the process also plays a
106
major role. Dr. Christian Gronroos (1998) argues that service quality is multi­
dimensional and comprises three dimensions, technical quality, functional quality and 
corporate image.
In the study, respondents were required to indicate which one of 5 factors most 
influenced their perception of the quality of service they experienced at the hotel. As 
illustrated in the pie chart blow, about 50% indicated that service encounter (functional 
quality) influenced their perception of service quality. Physical evidence scored about 
23%. Only about 8% saw the final outcome (technical quality) as the most critical factor 
that influenced their judgment of service quality. Price had 17%.
Figure 5.1 Most important factor influencing service quality perception
Most important factor influencing customer perception of service quality
17%
50%
23%
□  Service encounter ■  Physical evidence □Promotions
In respect of the third objective and fourth research question, the above pie chart 
demonstrates that service encounter is the most important factor in the assessment of 
service quality in service experience.
Hotels must therefore ensure that every service encounter is satisfactory to the customer 
in order to improve the level of quality perception of the entire service experience.
5.8 SUMMARY
Respondents were finally asked to give an assessment of their perception of the quality of 
service they experienced. 26.41% rated the service as very high, 28.3% as high. 37.74% 
rated their experience as average and 7.55% as poor. Nobody however rated his 
experience as very poor.
108
Figure 5.2 Levels of service quality perceptions: absolute responses.
Service quality perceptions
c©■ecsa.IB9
«Si
E3
140
120
100
80
60
40
20
84
120
-&0-
24
Very high High Average Poor
Service quality
Very
poor
109
Figure 5.3 Levels of service quality perceptions- percentage responses.
73.58% respondents had either very high or high expectation, 71.70% said their 
expectations were met, and 54.72% indicated that their service experience were either 
high or very high. These data confirm the assertion made earlier in chapters one and 
three that there are other uncontrollable elements that also influence customer perception 
of service quality. Though expectations may be met, other variables such as personal 
circumstances or needs may influence a customer to perceive the quality of a particular 
service encounter as average performance.
110
References
1. Valerie A. Zeithaml and Mary Jo Bitner, Services Marketing: Integrating 
Customer Focus Across the Firm, 2000, New York, Irwin McGraw-Hill
2. Journal of Business and Industrial Marketing, Vol.13 No. 4/5 1988, pp 322-338, 
MCB University press, 0885-8624.
\
111
CHAPTER SIX
6.0 CONCLUSIONS AND RECOMMENDATIONS
6.1 CONCLUSIONS
Service quality is a critical factor in service delivery. However, a customer’s assessment 
of service quality is a subjective judgment, which is dependent on the customer’s 
perception of the particular service experience. The following conclusions can be drawn 
from the preceding discussions on service marketing literature and data gathered from the 
survey.
• It was demonstrated that a customer’s perception of service quality is very much 
influenced by the expectations the said customer had prior to the service experience. 
Generally, when a customer’s expectations are met in a service encounter, his 
perception of the service quality would be high.
• Firm level communication has a major impact on customer expectations. What a firm 
says and how it says it influence customer expectation. Less explicit communications 
such as the image and physical appearance of the hotel, the dressing and appearance 
of the service employees and the price the hotel charges for it’s services, also 
communicates with the customer and sets the stage for the customer to develop a 
certain level of expectation.
112
• Internal marketing has a major influence on customer perception of service quality. 
Service quality perceptions is positively influenced when internal marketing is so 
managed that communications from the company to employees are accurate, 
complete and consistent with what the customer is exposed to by way of 
communication.
• Also, when marketing communication from various promotional tools are integrated, 
they present common and consistent promises and claims. The gap between what 
customers expect based on the messages and what they receive in service delivery, 
would therefore be bridged. This would enhance the probability of a service 
encounter being perceived as high.
• Furthermore, when service firms make promises that cannot be delivered, or 
exaggerate their capabilities, it adversely affects service quality perceptions. When 
customers cannot access a service at a particular point in time or place as promised, or 
the service cannot be delivered in the manner the firm claims, service quality of such 
an encounter will be low.
• Finally, the study demonstrated that the price of a service experience is not a major 
deciding factor in the assessment of the quality of service. The technical quality is 
also not as important as the convenience, comfort, safety and the attraction of the 
physical setting. Besides physical evidence, service encounter was shown to be the 
most critical factor in influencing a customer’s judgment of the quality of service.
113
Over 50% of all respondents indicated that functional quality was the single most 
important factor that influenced how a particular service experience was rated.
6.2 RECOMMENDATIONS FOR MANAGEMENT OF SERVICE FIRMS 
From service marketing literature and the preceding discussions, it has been amply 
demonstrated that firm level communication shapes expectations which influences 
service quality perceptions. In order to improve the perception of service quality, service 
firms would have to match their firm level communication with their delivery 
capabilities. In this light, it is recommended that management of service firms adopt the 
following strategies to match firm level communication with service delivery.
• Service firms should only make promises that are capable of being fulfilled. Firms 
should not attempt to make service appear more attractive than they really are.
• Firm level communication about service delivery must closely reflect what 
customers will receive in an actual service encounter.
• External marketing communication, internal and interactive marketing must be 
integrated to ensure that what the customer hears and sees conforms to what he 
experiences in an actual service encounter.
• Service employees must be adequately informed of everything that is communicated 
to the customer through external marketing.
114
• Communication between the various functional units must be encouraged and
effectively coordinated to reduce the gap between customer expectations and actual 
service delivery.
6.3 RECOMMENDATION FOR FUTURE RESEARCH STUDIES
• Data gathered in the study indicated that over 50% of respondents considered 
“Service encounter” (as against promotion, physical evidence, price and final out 
come of service) as the primary factor that influenced their perception of service 
quality during the service experience. The study however focused on customers of 3, 
4 and 5 star rated hotels. For a broader industry picture, it is suggested that future 
studies investigate whether the results would hold true for 1 star, 2 star, budget hotels 
and guesthouses.
• In this study, customer expectation was shown to have an influence on customer 
perception of service quality. However, as Zeithhaml and Bitner (2000) observed, 
meeting customer expectation is not enough, firms must exceed expectations in order 
to retain customers. In future studies, it is suggested that researchers investigate the 
effect that exceeding a customer’s expectation will have on the future expectations of 
that same customer.
115
Reference
!■ Valerie A. Zeithaml and Mary Jo Bitner, Services Marketing: Integrating 
Customer Focus Across the Firm, 2000, New York, Irwin McGraw-Hill
116
1. Belch, G. E and Belch, M. A, 1995, Introduction to Advertising and Promotion, 
An Integrated Marketing Communication Perspective, New York, Irwin.
2. Berry, Leonard L. and Parasuraman, A., Marketing Services Competing through 
quality. The Free Press, a division of Macmillan, Inc, New York.
3. Buatsi, S. N (PhD), January 2000, Proceedings of the 7th International Conference 
on Marketing and Development, University of Ghana, Accra
4. Dahringer, Lee D. and Muhlbacher, Hams 1991 International marketing, A Global 
Perspective, Addison-Wesley publishing company.
5. Etzel, Michael J., Walker, Bruce J., Stanton, William J., Marketing, 1997, New 
York, Irwin McGraw-Hill,
6. Khurana, Rakesh (PhD), Kaushik, Madhulika (PhD), Yadava, Kamal, Marketing 
of Services, Concepts Applications, 1993, New Delhi, Sona Printers Pvt. Ltd.
7. Kotler, Philip 1991 “Marketing Management” Analysis, Planning, 
implementation and Control, Englewood Cliffs, New Jersey Prentice- Hall, Inc.
8. Kotler, P., Armstrong, G., Saunders, J. and Wong, V., Principles of Marketing, 
The European Edition, 1996, London, Prentice Hall.
9. Kumekpor, Tom K. B., 1999, Research Methods and Techniques of Social 
Research, Accra, SonLife Press and Service
10. Me Guire, William J., An Information Processing Model of Advertising 
effectiveness” in Behavioural and Management Science in Marketing ed. Harry J. 
Davis and Alvin J. Silk (New York: Ronald Press, 1978) pp 156 -80
11. Opoku, J. Y, 2000, A Short Guide to Research writing in the Social Sciences and 
Education, Accra, Ghana Universities Press
12. Powers, T., 1995, Introduction To The Hospitality Industry, New York, John wily 
and Sons Inc.
13. Schiffman, Lean G. and Kanuk, Leslie Lazar 1978, "Consumer Behaviour" 
Prentice-Hall, Inc. Eaglewoods cliffs, New Jersey.
14. Stanton, William J., Fundamentals of Marketing, 1981 McGraw Hill, New York
15. Twumasi, P. A 2001, Social Research in Rural Communities, Accra, Ghana 
Universities Press
Bibliography
117
16. Zeithamlm, Valarie A. and Bitner, Mary J., 2000, Services Marketing, Integrating 
Customer Focus Across The Firm, New York, Irwin, McGraw-Hill
17. Ghana Tourist Board Directory, 2000
18. Journal of Business and Industrial Marketing, Vol.13 No. 4/5 1988, pp 322-338, 
MCB University press, 0885-8624.
19. Lehtinen U., Lehtinen J.R., Service Quality: A study of Quality Dimensions, 
Service Management Institute, Helsinki, 1992.
Web-bliography
1. http://www.ahdoro.emeraldinsight.com/ Date of entry: 09/21/01
2. http://www.anzmac99.unsw.edu.au/ Date of entry: 09/21/01
3. http://www.apri.ac.nz/ Date of entry: 22/10/01
4. http://www.arl.org/libqual/ 15/10/01
5. http://www.enesto.emeraldinsight.com/ Date of entry: 09/21/01
6. http://www.ggallagher.co.uk/perception/ Date of entry: 25/10/01
7. http://www.hotelbenchmark.com/ Date of entry: 05/04/02
8. http://www.hs.ttv.edu/ Date of entry: 05/04/02
9. http://www.hvsintemational.com/ Date of entry: 14/04/02
10. http://www.ih-ra.com/ Date of entry: 14/04/02
11. http://www.Imt.za/qrater Date of entry 22/10/01
12. http://www.info.gov.hk/isd/hk98 Date of entry: 05/04/02
13. http://www.Is.unc.edu/ Date of entry 12/10/01
14. http://www.jadma.orgele-page/ Date of entry: 16/02/02
15. http://www.macfadden.mit.edu:9500/ Date of entry 12/01/02
16. http://www.mailrite.com/ Date of entry: 16/02/02
17. http://www.marketersnet.com/ Date of entry: 16/02/02
118
18. http://www.nedlac.org.za/docs/ Date of entry: 05/04/02
19. http://www.newark.rutgers.edu/ Date of entry: 19/02/02
20. http://www.nscb.gov.ph/secstat/ Date of entry: 05/04/02
21. http://www.qualitydigest.com/ Date of entry: 12/01/02
22. http://www.realtytimes.com/ Date of entry: 22/02/02
23. http://www.thecagroup.com/ Date of entry: 22/02/02
24. http://www.utdt.edu/comgresos/empresarial Date of entry: 05/04/02
25. http://www.web-source.net/ D a te  of entry: 16/02/02
119
APPENDIX 1 QUESTIONNAIRE FOR FRONT LINE STAFF
Dear Sir/ Madam,
Please spare me a moment of your time and take a look at this questionnaire.
I am a final year student of the School of Administration, University of Ghana, Legon. I 
am undertaking a Masters Degree Programme in Business Administration, specialising in 
Marketing. As part of the requirement towards the award of the Masters Degree, I am 
required to present a thesis on the effect of “Firm Level Communication on Customer 
Perception of Service Quality in the Hotel Industry in Ghana”.
In this respect, I have designed a questionnaire to capture relevant information as part of 
the research towards the writing of my thesis. Your hotel is one of the few hotels I have 
chosen to include in the study. I would therefore be very grateful if you could give me 
your valued opinion on a number of subjects by completing the attached questionnaire.
Please be assured that the information you provide will be kept strictly confidential. A 
copy of the completed work will be made available to you on request.
Thank you in advance for accepting to be part of this excise despite your busy schedule. 
Your contribution is very much appreciated.
Yours faithfully
Mahama Braimah 
Student
120
SECTION A  (Please tick as appropriate)
1. Does your Hotel carry out any form of promotion?
Yes No
2. What forms of promotion does your hotel carry out? Choose as many as 
applicable.
□  Advertising
| Sales promotion 
I I Personal selling
□  Publicity and Public relations
□  Directly contacting clients
| Others.........................................................................................................
3. Do customers sometimes confront you about promises and claims the hotel makes 
that you are not aware of?
Yes No
4. Do customers sometimes complain about promises and claims the hotel makes that 
you are not adequately briefed about?
Yes No
5. Are you always in the know of claims and promises the hotel makes? 
Yes No
6. Does the hotel complain about your not meeting the expectations of the customers? 
Yes No
7. How often does the hotel complain?
Always Quite often Occasional Once
121
8. What specifically does the hotel complained about?
9. Could the hotel’s complaints indicated in Item 8 above have been avoided? 
! 1 Yes ' No
10. How could these complaints indicated in Item 8 above have been avoided?
SECTION B
For the purposes of the study we define backstage staff as the employees who do not 
handle customers directly, but provide support service that enables you to provide 
services to your customers.
11. Do backstage staff always know of what you expect of them?
i NoYes
12. Do backstage staff complain about your demands on them?
I | Yes I I No
13. How often do backstage staff complain about your demands on them?
Once
14. What specifically does the backstage staff complain about?
1 Always Quite often Occasional | |
122
15. Could the backstage staffs complaints about your demands on them have been 
avoided?
Yes   No
16. How could these complaints indicated in item 14 above have been avoided?
17. How do these complaints you have indicated in items 8 and 14 above affect the 
quality of service you provide?
| j Positively |____ | Negatively |____ | No effect
18. Please explain your answer
SECTION C (Optional)
19. What is the name of your hotel? .................................................................
20. What is your name? ....................................................................................
21. What is your gender?
I I Female I I Male
22. What is your marital status?
Married | | Cohabiting | | Separated
Single | I Divorced | | Widowed
23. What is your position / rank / title? .............................................................
24. What duties do you perform?
□□
123
APPENDIX 2
QUESTIONNAIRE FOR EXECUTIVE MANAGEMENT
Dear Sir/ Madam,
Please spare me a moment of your time and take a look at this questionnaire.
I am a final year student of the School of Administration, University of Ghana, Legon. I 
am undertaking a Masters Degree Programme in Business Administration, Marketing 
option. As part of the requirement towards the award of the Masters Degree, I am 
required to present a thesis on the effect of “Firm Level Communication on Customer 
Perception of Service Quality in the Hotel Industry in Ghana”.
In this respect, I have designed a questionnaire to capture relevant information as part of 
the research towards the writing of my thesis. Your hotel is one of the few hotels I have 
chosen to include in the study. I would therefore be very grateful if you could give me 
your valued opinion on a number of subjects by completing the attached questionnaire.
Please be assured that the information you provide will be kept strictly confidential. A 
copy of the completed work will be made available to you on request.
Thank you in advance for accepting to be part of this exercise despite your busy schedule. 
Your contribution is very much appreciated.
Yours faithfully
Mahama Braimah 
Student
124
Do you carry out any form of promotions for your services?
I 1 Yes | | No
By what means do you promote your services?
I I Advertising | | Public relations/publicity
□  Sales Promotion | | Direct contact of clients
□  Personnel selling |-----1 Internet
Besides promotion, what other means do you adopt to let the public know about 
your services?
SECTION A (Please tick as appropriate)
Do all your promotions make the same claims?
| | Yes 1 | No
Please explain the reason(s) behind your answer
Is there any company policy aimed at ensuring that all messages from all your 
promotional tools make common claims?
I I Yes I I No
What motivated management to adopt or not to adopt such a policy?
8. How have these affected the perception of your service quality?
| | Positive | | Negative | | No effect
9- Please explain your answer
10. Do you have a Web Site?
Yes No
11. Are there any conflicting claims or presentations you make on the net and other 
forms of communication?
Yes No
12. Please state the differences as in Item 11 above
13. What claims do your promotions make?
14. Do you make claims such as indicate in item 13 above that you know cannot be 
met? _____
I I Yes I I No
15 Have you made claims before that when clients attempted accessing them, the 
hotel was not ready to provide it?
Yes I No
126
16. Do backstage staff always know the promises marketing makes?
| | Yes j j No
17. Do backstage staff always know what the front line staff expect of them?
| I Yes | | No
18. Do front line staff always know and understand the claims made by marketing?
! Yes | | No
19. Have you ever received complaints from customers about:
i) Services promised but not met.
□  Yes □  No
ii) Claims made but were not available at the time as promised.
| | Yes Q  No
iii) Conflicting promises and claims the hotel has made through various
communication channels.
j 1 Yes | | No
iv) Other complaints
20. In your view, how did these complaints affect the perception of your services? 
| | Positively | | Negatively | | No effect
21. Please explain your answer
22. Have you ever received complaints from employees in respect of:
i) Front line Staff not knowing the claims and promises marketing is making
| [ Yes | | No
ii) Claims made but were not available at the time promised
I I Yes I I No
127
iii) Backstage staff not cooperating with front line staff because they (back 
stage staff) did not know in good time what was expected of them?
| | Yes | | No
iv) Other complaints
23. In your opinion, did these have any negatively effect on your service quality?
1 1 Yes | | No
24, Please explain your answer.
SECTION B (Optional)
25. What is the name of this hotel? ......................................................
26. What is your name? .......................................................................
27. What is your gender? | | Female | | Male
28. What is your marital status?
Married | | Single
□  Cohabiting I 1 Separated
29. What is your position /rank / title? ..............................
30. What duties do you perform?
, | Divorced | | Widowed
128
APPENDIX 3
QUESTIONNAIRE FOR CUSTOMERS.
Dear Sir/ Madam,
Please spare me a moment of your time and take a look at this questionnaire.
I am a final year student of the School of Administration, University of Ghana, Legon. I 
am undertaking a Masters Degree Programme in Business Administration, Marketing 
option. As part of the requirement towards the award of the Masters Degree, I am 
required to present a thesis on the effect of “Firm Level Communication on Customer 
Perception of Service Quality in the Hotel Industry in Ghana”.
In this respect, I have designed a questionnaire to capture relevant information as part of 
the research towards the writing of my thesis. This hotel is one of the few hotels I have 
chosen to include in the study. I would therefore be very grateful if you could give me 
your valued opinion on a number of subjects by completing the attached questionnaire.
Please be assured that the information you provide will be kept strictly confidential.
Thank you in advance for accepting to be part of this exercise despite your busy schedule. 
Your contribution is very much appreciated.
Yours faithfully
Mahama Braimah 
Student
129
SECTION A (Please tick as appropriate)
1 ■ How often do you use the services of this hotel?
[ j Regularly | | Occasional | | First time-visit
2. What service do you mostly patronise? Tick as many as applicable
□  Restaurant / bar □  Recreation (Swimming/ tennis/ etc.)
I I Lodging and boarding | | Social Interactions
□  Conference/ Seminars/ etc. □  Other purposes.
3. Did you have any prior expectations of the services of the hotel?
I ■ I Yes I I No
4. If yes, what were your expectations like?
□ Very high □ Low
1 1 High
What influenced your expectations?
□ Personal needs □ Prior interactions with staff□ Promotions □ Image of the hotel
□ Hotel charges/price□ Prior interactions with friends, family, colleague, etc.
□ Other sources.......................
130
SECTION B (Tick as many as applicable)
In respect o f your experience, please indicate whether the following items 
exceeded, met or fell short o f your expectations
Item
No.
Variables Exceeded
Expectations
MetExpectation Fell Short of Expectation
6.
Are physical facilities attractive and 
Convenient?
7. Are staff dressed appropriately
8.
Are your exact specifications 
Followed?
9. Do thev deliver on time
10.
Is Service performed right the first 
Time?
11.
Do they respond quickly to your 
Demands?
12.
Are staff willing to answer your 
Questions?
13.
Do staff appear to know what they 
Are about?
14.
Are staff polite, pleasant and 
Considerate?
15. Do you feel safe?
16.
Are your records kept safe 
And confidential?
17.
Are service access points 
conveniently located?
18.
How easy is it to reach the 
Appropriate staff?
19.
Do staff communicate in an easy 
To understand language?
20.
Do staff listen and demonstrate 
Understanding and concern to your 
Needs.
21.
Are service providers flexible 
Enough to accommodate your 
Needs.
22. How will you rate the quality of service of this hotel, in respect of the above
I High Average Poor | |
SECTION C (Please tick as appropriate)
23. From what official sources did you hear or see a message about this hotel 
(Tick as many as applicable)
1 1 Television I I Radio | | Internet
Newspaper |____ | Magazine
During social/public activities Members of staff
Other source
24. Have you noticed any inconsistencies between the messages from the various 
sources?
Yes No
25. If yes, what were those discrepancies?
26. Have you noticed any discrepancies between some of the messages and the 
service you have experienced?
Yes |____ I No
27. If yes, please state those discrepancies?
28. How has these discrepancies affected your rating of the service quality of the 
hotel?
Positively Negatively No effect
132
SECTION D
29.
30.
31.
32.
33.
34.
35.
36.
37.
Indicate whether or note, there are differences between what you have 
learnt about this hotel and what you have experienced;
Tick Yes, if there are discrepancies, and No, if there are no discrepancies.
Procedures and Regulations 
Services available 
Service flexibility 
Speed of delivery of service
Yes
Yes
Yes
Yes
Employee understanding of your requirements
Has these influenced your perception of the hotel?[ 
How have you been influenced?
I Positively Negatively
In your opinion does the hotel meet its promises? 
Give reasons for your answer in item 36, above
No
No
No
No
Yes
Yes [
No
No
Yes
No influence 
I I No
38.
39.
40.
In summary, did your experience with this hotel meet your expectation? 
Yes No
In what way was your expectation met?
| | Expectations exceeded | |
How would you judge the quality of service here? 
I Very high I I High [_
Expectations met
Average |____ | Poor Very Poor
133
41. Indicate which of the following factors most affected your assessment of 
the quality of service you experienced in the hotel.
a) Service encounter
b) Physical evidence
c) Price
d) Promotion
e) Final outcome of the
Service encounter
42. What other comments will you like to make in respect of your expectations and 
your assessment of the quality of service you have received?
43.
44.
45.
46.
SECTION E (Optional)
What is your name? . 
What is your gender? 
What is your age?
Female Male
What is your marital status? 
r I Married ' Single Divorce | Widowed
Cohabiting
134
47. What is your occupation?
□ Lawyer □ Marketer
□ Doctor b d Farmer
□ Entrepreneur/Investor □ Hotelier
□ Student □ Banker
□ Driver □ Politician
□ Public /Civil servant □ Engineer
□ Business Executive □ Unemployed
□ Educationist i— i Accountant
□ Other .......................................
What is your Nationality?
1 I Ghanaian | | African i | European
1 1 Atsia 1 1 Dnpanis i 1 North Americar
1 1 South American
135