Thailand
The aim of internal communication practice in the internal branding context is employees’ satisfaction because employees’ satisfaction is linked to customers’ satisfaction who as a result, become more loyal and therefore, create more profit for the company (Dunmore, 2002). This means that employee satisfaction affects the customer satisfaction and organizational productivity (Potterfield, 1999). For this reason, the managers of hotels in Thailand have to pay attention to hotel ranking, which comes from customer satisfaction (Narangajavana & Hu, 2008).
The question of this thesis is: “What is the difference between the internal communication of high ranking hotels and low ranking hotels in developing countries, especially Thailand?”
4.3.1 Hotel Rating Systems
The hotel rating system is used for hotel management and as the primary instrument with respect to improving service quality and to communicate and reinforce service quality to all stakeholders involved in the hotel industry (Narangajavana & Hu, 2008). The study of World Tourism Organization (WTO) & International Hotel and Restaurant Association (IH&RA) showed that the hotel rating systems offer benefits to five parties involved in the hotel industry: travel agencies, tour operators, hotels, governments, and consumers (Narangajavana & Hu, 2008). From the hotel managers’ point of view, hotel rating systems use classification schemes such as ‘‘branding’’, which create total quality across every aspect of the customer relationship (Gronroos, 1990; Narangajavana & Hu, 2008). The hotel rating systems help managers determine scope of its customer-service function and conduct a customer-service audit. The hotel rating systems can identify all customer-contact tasks and the standard procedures prescribed for each (Lovelock, 1992). Therefore, the hotel rating systems will report the current business situation and provide a fundamental basis for planning the factors shaping customer-service functions and quality of the customer-service
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functions. Since customer service is one of the most important tools in competitive differentiation, an appraisal should also be done of competitors’ customer-service efforts (Lovelock, 1992). Additionally, the company can provide information about the hotel rating systems to its employees in order to show how they affect the whole firm. The hotel rating systems can be helpful in increasing employees’ awareness of their role in customer satisfaction and company success.
This thesis focuses on the role of internal communication in internal branding concept, which aims to shape employees’ behaviours to deliver brand promise to customers and to create much higher levels of customer satisfaction. Therefore, the hotel rating used in this thesis could extend the concept of customer satisfaction that can aid in the development and testing of the internal branding concept in the Hotel industry in Thailand. TripAvisor’s hotel ranking system is selected for this research.
4.3.2 TripAvisor’s hotel ranking system
The following paragraphs show the reasons why this thesis selected TripAvisor’s hotel ranking system.
First of all, TripAdvisor ranks hotels in destinations according to how favourably consumers reviewed them. It means that hotel rankings in TripAdvisor are created from traveller satisfaction. According to the official TripAdvisor website, they describe “TripAdvisor ranking” as:
Based on their experience with you, travellers rate and review your property.
Based on those reviews, your property receives an overall TripAdvisor rating, with 5 being the highest.
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Your TripAdvisor rating then factors into your property’s overall TripAdvisor ranking among other properties in your location. TripAdvisor rankings are also known as the Popularity Index. The better your ratings and the more recent your reviews the higher your property’s TripAdvisor ranking can potentially go.
The objective of internal branding approach through internal communication is to develop employees that ‘live the brand’, since this has been found to have an impact upon revenue, growth and profitability of the company. This is because employees’ satisfaction is linked to customers’ satisfaction who, as a result become more loyal and therefore, create more profit for the company (Dunmore, 2002). Therefore, the objective regarding customers’ satisfaction of the internal branding and TripAdvisor ranking are conceptually similar.
Second of all, it is widely known that TripAvisor’s hotel ranking system is the most successful hotel rating system. According to the study of Whitehead (2011), it shows that the travel review website receives over 40 million worldwide visitors through the site every month, it has 20 million registered users, and offers over 45 million traveller reviews, covering more than 125,000 visitor attractions, 450,000 hotels, and 600,000 restaurants. Similarly, the study of Xiang and Gretzel (2010) supports that TripAdvisor is a powerful unique domain name in the Google information search for travel information.
Finally, the research of Smyth, Wu, and Greene (2010) studies the TripAdvisor effect of the hotel sector in Ireland and Las Vegas hotels and found that TripAdvisor will result in an increase in standards of service. It means hotel owners/ managers look at their ranking from TripAdvisor and all complaints about their hotels as opportunities to improve customer service levels. Additionally, according to the study of Tuominen (2011), it was found that there is a relationship between the hotel performance and the number of reviews given as
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well as with the ratings of the reviews. Therefore, it has an enormous influence on the hotel businesses.
4.3.3 Evaluating the moderating of internal communication of high ranking hotels and low ranking hotels in Thailand
The ASEAN Economic Community (AEC) by 2015 will have an impact on the Thai Hotel Industry. The AEC will attempt to increase market size and the number of competing firms, resulting in greater efficiency and lower prices for customers (Czinkota et al., 2009). Integration factor has served to stimulate competition, which, in turn places a premium on encouraging innovation and developing workers to ensure that the human resources are available to operate and deliver on the brand promise to their customers. Successful brands delivering on their promises can be a way of differentiating the offering and creating a competitive advantage (Khanyapuss Punjaisri & Wilson, 2007). For this reason, the Thai Hotel Industry needs to plan every aspect for it to be successful, especially to raise Thai hotels’ overall service quality and to deliver excellent quality service to customers (Narangajavana & Hu, 2008).
Effective service management, which focuses on the delivery of the brand promise to the customers, requires a shift in thinking from external branding to internal branding (Khanyapuss Punjaisri & Wilson, 2007). Therefore, Thai hotel managers need to understand the concept of internal branding that internal communication has the biggest influence on employees’ brand outcomes. A Thai hotels survey by the Thai National Statistical Office (2014) found that more that 80 percent of the hotels in Thailand have difficulty creating competitive advantage, and more than 70 percent of the hotels need the Thai government to support them with the potential to improve and grow. According to this report, doing research and development in Thailand is still rare for most of the Thai hotel industry.
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Therefore, studying the comparison of moderating of internal communication between high ranking and low ranking hotels in Thailand can lead to a deeper and broader understanding of the internal communication approach. Internal communication research on high ranking hotels has led to the development of the internal communication system of low ranking hotels in Thailand. When internal communication in the internal branding concept in low ranking hotels is improved, then it will lead to employee satisfaction and customer satisfaction that will result in good business outcomes in the Thai hotel Industry (Nilsson, Johnson, & Gustafsson, 2001; Khanyapuss Punjaisri & Wilson, 2007).
For this research, TripAdvisor hotel rankings are classified into two types: high ranking and low ranking. As TripAdvisor hotel rankings show a number out of all destinations, this research classifies hotels based on the percentage of order of hotels in this destination: high ranking (less than 50%) and low ranking (more than 50%).
4.4 Conclusion
This chapter, upon integrating the literature and theoretical foundations developed in Chapter 2 and 3 with the concept of internal branding, new internal communication satisfaction dimensions and the influence of internal communication on employees brand outcomes, made the case for extending acculturation theory into the developing country contexts. It presented an evaluation of the influence of new internal communication satisfaction dimensions on employees’ behaviour from high/ low performance employees in a developing economy.
Objective 3 was developed to explain and predict variance of new internal communication satisfaction dimensions from high/ low performance employees in a developing economy. The next Chapter 5 presents the design of the empirical study developed to address these hypotheses.