Impact of Customer Relationship Management on Customer Satisfaction: The Case of a Budget Hotel Chain

Customer Relationship Management (CRM) is a successful marketing strategy that has been proven to improve customer satisfaction and retention in the hotel business. CRM can bring many benefits to the hotel business, though there are some associated challenges such as the implementation process, which can prove to be time consuming, expensive, and complex in nature. Such challenges often bring a significant risk of failure, and these risks become more significant in budget hotels, due to inadequate supporting budgets and the lack of strong branding and loyalty schemes. This study considers the changes that have emerged in the last decade as regards customer expectations when staying in budget hotels. We use qualitative approaches to investigate the overlaps between customer expectations and managers’ perceptions of CRM applications. The findings reveal that regardless of all changes, value for money and core products continue play a critical role in customers’ overall satisfaction of budget hotels. This suggests there is a need to align management and customer perspectives on CRM, in order to optimize customer value in terms of delivery and experience. Keywords: Customer Relationship Management (CRM), Customer Satisfactions, Satisfaction Criteria, Customer Expectation and Budget Hotels.