Effects of Customer Satisfaction on Customer Loyalty in Selected Hotels in Nairobi, Kenya

Customer loyalty is a key objective for organizations pursuing a relationship approach with their customers. Creating and maintaining loyalty with customers is critical for the survival of a company in a competitive environment as in the hospitality sector. The link between customer satisfaction and customer loyalty in the service sector especially in hotels seems to be unclear. Further, limited literature and studies related to customer satisfaction and customer loyalty exist in the hotel sector in Kenya, hence the need for this study. The purpose of this study was to provide an understanding of the effects of customer satisfaction on customer loyalty in the hotel sector in Kenya. The sample size for the study was 253 and six marketing managers who were used as key informers. The study employed purposive, stratified and systematic random sampling. Reliability was tested using Cronbach’s Alpha resulting in a value 0.924. Factor analysis was used for data reduction while simple regression was used to analyze and test the hypothesis. The findings of this study indicated that customer satisfaction (t=13.940, p<.001) significantly affected customer loyalty. It was concluded that an improvement in customer satisfaction would likely result into improved customer loyalty.