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IMPACT OF INTERPERSONAL RELATIONSHIP ON SERVICE
PROVIDERS: A CASE STUDY OF HAIR STYLISTS IN NAIROBI
BY
ABDIRIZAK A. HUSSEIN
UNITED STATES INTERNATIONAL UNIVERSITY - AFRICA
FALL 2015
IMPACT OF INTERPERSONAL RELATIONSHIP ON
SERVICE PROVIDERS: A CASE STUDY OF HAIR STYLISTS IN
NAIROBI
BY
ABDIRIZAK A. HUSSEIN
A Project Report Submitted to the Chandaria School of Business in
Partial Fulfilment of the Requirement of the Masters Degree in Business
Administration (MBA)
UNITED STATES INTERNATIONAL UNIVERSITY-AFRICA
FALL 2015
ii
STUDENT’S DECLARATION
I, the undersigned, declare that this is my original work and has not been submitted to any
other college, institution or university other than the United States International
University.
Signed: ________________________ Date: ___________________________
Abdirizak A. Hussein (I.D 606241)
This research report has been presented for examination with our approval as the
appointed supervisors.
Signed: ________________________ Date: ___________________________
Dr. Peter Kiriri
Signed: _______________________ Date: ___________________________
Dean, Chandaria School of Business
iii
COPYRIGHT
All rights reserved including rights of reproduction in whole or part in any form without
the prior permission of the author or United States International University or Office of
the Deputy Vice Chancellor Academic Affairs.
© 2015
iv
ABSTRACT
The general objective of this study was to determine the impact of interpersonal
relationship between service providers and clients towards customer satisfaction and
business profitability. The study was guided by the following specific objectives: to
establish whether interpersonal relationship results in customer satisfaction; to establish
whether interpersonal relationship results in overall customer loyalty; to establish whether
interpersonal relationship results in free publicity like good word of mouth, referrals and
recommendations and; to establish whether interpersonal relationship results in
profitability for the firm.
Descriptive research design was employed in the study. The target population included
hair stylists in Nairobi Central Business District. Simple random sampling was used for
this study to come up with a sample size of 30 hair stylists within the central business
district in Nairobi. This study used primary data where the data was collected by use of
questionnaires. The collected data was analysed using descriptive statistics including
frequencies and percentages and was presented in frequency distribution tables.
The study revealed that the factors in interpersonal relationships that lead to customer
Satisfaction include addressing customers by their names, knowing about their families,
knowing about the clients work or what they do for a living, keeping client’s promises,
caring and individualized attention to the customers, responsiveness/willingness to help
and staff reliability. Further the study revealed that satisfaction results in repeat purchase.
The study further revealed there was positive significant relationship between customer
loyalty and interpersonal relationship. This findings imply that interpersonal relationship
influence overall customer loyalty and retention. The study also revealed that recognition,
service failure, awareness/publicity, interpersonal relationships and experimentation were
very important factors in retaining customers and that it is more profitable to retain
existing customers than continually recruit new ones.
It was also revealed that there was a positive significant relationship between free
publicity like good word of mouth and interpersonal relationship. The findings imply that
firms’ interaction in terms of reward systems for introducing new clients and preferential
v
rates for multiple family accounts enables a client to be a reference for a firm. The study
also revealed that relationship marketing is successful in spreading positive word of
mouth about the business.
Finally the study revealed that there was a positive significant relationship between
profitability and interpersonal relationship. The findings imply that the firms benefit from
long term relationships in that it encourages repeat purchases, reduced marketing costs
and generally improves longer term planning. The study further revealed that speed,
safety, reliability, flexibility, affordability, accessibility and customer care were factors
that increased a hair stylist’s profitability. The study also revealed that firms benefit more
from maintaining long term relationships than a short term relationships and that
customer’s relationship with the company lengthens profits rise.
The study concludes that customer satisfaction, customer loyalty, customer centric
publicity and firm’s profitability are affected by firms specifically in this case; Hair
stylists firms in the central business district of Nairobi Kenya. The study also concluded
that recognition, service failure, awareness/publicity, interpersonal relationships and
experimentation were very important factors in retaining customers and that it is more
profitable to retain existing customers than continually recruit new ones.
The study recommends that Hair styling firms in the central business district of Nairobi
need to consider and come up with various programs that will influence the way they
interact with their customers. In this regard they need to design programs for the
management and staff of their organizations that ensures positive interaction with clients.
The study further recommends that the stylists improve on their employee satisfaction as
this will in turn enable them serve the customers’ better thereby instilling a culture of
trust.
Finally it was important to understand the little things that consumers use as a basis for
making judgements when it comes to patronizing a particular hair styling firms. The study
recommends the need for hair styling firms to invest in retention and loyalty programs.
vi
ACKNOWLEDGEMENT
I wish to acknowledge my supervisor Dr. P. N. Kiriri for his guidance throughout my
research. I would like to appreciate my Parents and Family for their support.
vii
DEDICATION
This study is dedicated to Allah for seeing me through, my parents Ahmed and Mumina
for believing in me and encouraging me, My Wife Fauziah for being the rock of our
family as I struggled with work and school and my two Kids Ahmed and Rani.
viii
TABLE OF CONTENTS
STUDENT’S DECLARATION ....................................................................................... ii
COPYRIGHT ................................................................................................................... iii
ABSTRACT ...................................................................................................................... iv
ACKNOWLEDGEMENT ............................................................................................... vi
DEDICATION................................................................................................................. vii
LIST OF TABLES ............................................................................................................ x
CHAPTER ONE ............................................................................................................... 1
1.0 INTRODUCTION .................................................................................................. 1
1.1 Background of the Study .......................................................................................... 1
1.2 Statement of the Problem ......................................................................................... 6
1.3 General Objective ..................................................................................................... 7
1.4 Specific Objectives ................................................................................................... 7
1.5 Importance of the Study ........................................................................................... 7
1.6 Scope of the Study .................................................................................................... 8
1.7 Definition of Terms .................................................................................................. 8
1.8 Chapter summary ................................................................................................... 10
CHAPTER TWO ............................................................................................................ 12
2.0 LITERATURE REVIEW .................................................................................... 12
2.1 Introduction ............................................................................................................ 12
2.2 Interpersonal Relationship and Customer Satisfaction .......................................... 12
2.3 Interpersonal Relationship and Customer Loyalty ................................................. 17
2.4 Interpersonal Relationship and Free Publicity Word of Mouth ............................. 22
2.5 Interpersonal Relationship and Profitability ........................................................... 26
2.6 Chapter Summary ................................................................................................... 30
CHAPTER THREE ........................................................................................................ 31
3.0 RESEARCH METHODOLOGY ........................................................................ 31
3.1 Introduction ............................................................................................................ 31
3.2 Research Design ..................................................................................................... 31
3.3 Population and Sampling Design ........................................................................... 31
ix
3.4 Data Collection Methods ........................................................................................ 32
3.5 Research Procedures ............................................................................................... 33
3.6 Data Analysis Methods .......................................................................................... 33
3.7 Chapter Summary ................................................................................................... 33
CHAPTER FOUR ........................................................................................................... 35
4.0 RESULTS AND FINDINGS ................................................................................ 35
4.1 Introduction ............................................................................................................ 35
4.2 Demographic Information ...................................................................................... 35
4.3 Interpersonal Relationship Result In Customer Satisfaction .................................. 37
4.4 Interpersonal Relationships and Customer Loyalty ............................................... 44
4.5 Interpersonal Relationships and Free Publicity ...................................................... 51
4.6 Interpersonal Relationships and Firm Profitability ................................................ 53
4.7 Chapter Summary ................................................................................................... 61
CHAPTER FIVE ............................................................................................................ 62
5.0 DISCUSSION, CONCLUSION AND RECOMMENDATIONS ..................... 62
5.1 Introduction ............................................................................................................ 62
5.2 Summary ................................................................................................................ 62
5.3 Discussion .............................................................................................................. 63
5.4 Conclusion .............................................................................................................. 70
5.5 Recommendations .................................................................................................. 71
REFERENCES ................................................................................................................ 73
APPENDICES ................................................................................................................. 78
Appendix I: Introduction Letter to the Respondent ...................................................... 78
Appendix II: Questionnaire .......................................................................................... 79
x
LIST OF TABLES
Table 4.1 Gender of the Respondents ............................................................................... 36
Table 4.2 Respondent’s Highest Level of Education........................................................ 36
Table 4.3 Gender of Clientele ........................................................................................... 37
Table 4.4 Addressing Customer’s by Name Leads to Customer Satisfaction .................. 37
Table 4.5 Knowledge of Clients’ Families Leads to Customer Satisfaction .................... 38
Table 4.6 Knowledge of Client’s Work Leads to Customer Satisfaction ......................... 38
Table 4.7 Keeping Client’s Promises Leads to Customer Satisfaction ............................ 39
Table 4.8 Caring and individualized attention leads to Customer Satisfaction ................ 39
Table 4.9 Responsiveness/ willingness to help leads to customer satisfaction................. 40
Table 4.10 Staff reliability leads to customer satisfaction ................................................ 40
Table 4.11 Satisfied customer results in Customer retention and loyalty......................... 41
Table 4.12 Gain privileged information about customer needs and wants ....................... 41
Table 4.13 Satisfaction results in repeat purchase ............................................................ 42
Table 4.14 Satisfaction results in Favorable talk about the business. ............................... 42
Table 4.15 Customer retention impacts revenue and profitability .................................... 43
Table 4.16 Satisfied internal customer increasingly satisfy external customers .............. 43
Table 4.17 Perception of quality of the service provider .................................................. 44
Table 4.18 Employee incentive scheme for excellent work done .................................... 44
Table 4.19 Tracking customer visits ................................................................................. 45
Table 4.20 Type of Tracking System ................................................................................ 45
Table 4.21 Customer Loyalty Program ............................................................................. 46
Table 4.22 Customer Complaint System .......................................................................... 46
Table 4.23 Type of Complaint System ............................................................................. 47
Table 4.24 Customer retention against Customer Recruitment ........................................ 47
Table 4.25 Value derived as a Predictor of Switching Behaviour .................................... 48
Table 4.26 Recognition as a Reason why Individual Would Switch Salons .................... 48
Table 4.27 Customers switch salons after service failure ................................................. 49
Table 4.28 Customers Switch Salons due Competitor Awareness or Publicity ............... 49
Table 4.29 Customers interpersonal relationships with employees .................................. 50
Table 4.30 Experimentation and switching of customers to other salons......................... 50
Table 4.31 Current Customers as References ................................................................... 51
Table 4.32 Reward System for introducing new Customers ............................................ 51
xi
Table 4.33 Customers with Multiple Accounts ................................................................ 52
Table 4.34 Customers with Multiple Accounts Enjoy Preferential Rates ........................ 52
Table 4.35 Positive Word of Mouth ................................................................................. 53
Table 4.36 Customer’s trust results in positive word of mouth ........................................ 53
Table 4.37 Speed Increases Hair Stylist’s Profitability .................................................... 54
Table 4.38 Safety increases hair stylist’s profitability ...................................................... 54
Table 4.39 Reliability........................................................................................................ 55
Table 4.40 Flexibility results in hair stylist’s profitability ............................................... 55
Table 4.41 Affordability results in hair stylist’s profitability ........................................... 56
Table 4.42 Accessibility Results in Hair Stylists’ Profitability ........................................ 56
Table 4.43 Customer Care results in hair stylist’s profitability ........................................ 57
Table 4.44 Benefit from Maintaining Long term Relationships ....................................... 57
Table 4.45 Benefit from less customer defections ............................................................ 57
Table 4.46 Company profits lengthen ............................................................................... 58
Table 4.47 Source of Competitive advantage ................................................................... 58
Table 4.48 Long term relationships are profitable ............................................................ 59
Table 4.49 Low Maintenance ........................................................................................... 59
Table 4.50 Encourage Repeat and Increase Frequent Buying Activity ............................ 60
Table 4.51 Prepared to pay Premium Price ...................................................................... 60
1
CHAPTER ONE
1.0 INTRODUCTION
1.1 Background of the Study
The need for a mutually beneficial relationship between customers and business cannot be
over emphasized. Each has meaningful influence over the other, and also reflects the
basic reality of interdependence. Customers depend on organizations for need satisfying
products and services in a healthy environment; organizations depend on customers for
ideas (about needs and wants of customers), skill (human effort physically or mentally
directed towards production and service delivery), and money (prices of goods and
services). Customers blame a company when served poorly and rather than complain
directly to the company, they typically patronize another (Ndubisi & Ling, 2007).
Companies which recognize this fact, and recognize also that a number of factors
contribute to customers’ frustration even when managers and employees want to serve,
must make concerted, capable, collective efforts for the organizations to deliver value to
customers.
The issue of customer satisfaction and loyalty is an important one for managers of
organizations. As a result Marketer’s device various strategies to retain customers and
strengthen relationships with them, an approach called relationship marketing. According
to Colgate and Hedge (2011), relationship marketing is the process of building and
managing collaborative customer and other value chain relationships to increase customer
value, retentions and profit. Relationship Marketing is believed to be associated with
positive outcomes for firms including: greater profitability, increased consumer loyalty,
opportunities for strategic advantage, reduced costs of recruiting consumers and more
effective firm planning (Colgate & Hedge, 2011). There may also be benefits for
consumers when they develop relationships with firms. Buying from one firm may
simplify purchasing, reduce information collection and processing and limit risk by
increasing psychological satisfaction (Foxall, 2010).
Relationships which consumers have with firms have been characterized as similar to
interpersonal relationships in which the firm courts the consumer and they enter into a
mutually beneficial union. In the context of business-to-business industrial relationships,
2
it has been pointed out that “relationships require strong elements of interpersonal
obligation, and are undertaken between individuals or networks of individuals rather than
between organized corporate groups”. The utility of relationship marketing lies in the
creation of unique and difficult-to-imitate knowledge, but knowledge of customers can
only be increased if firms are capable of maintaining continuous relationships with their
customers (Sheth & Parvatiyar, 2005). Further, the willingness and ability of both
consumer and marketers to engage in relational marketing will lead to greater marketing
productivity, unless either consumers or marketers abuse the mutual interdependence and
cooperation (Sheth & Parvatiyar, 2005).
Interpersonal relationship thrives in trust. Crosby, Evans, and Cowless (2010) describe
trust as a feature of relationship quality, along with satisfaction and opportunism.
Anderson, Lodish and Weitz (2007) view trust as a feature of relationship, in addition to
power, communication, and goal compatibility. Interpersonal relationship means a
psychological and social relationship that manifests itself as care, trust, intimacy and
communication. These relationship exchanges can create value and therefore, help firms
to achieve sustainable competitive advantages.
Viljoen, Bennett, Berndt and Zyl (2005) notes that relationship marketing is the process
of building and managing collaborative customer and other value chain relationships to
increase customer value, retentions and profit. Relationship Marketing is an alternative
approach to the traditional 4P (product, price promotion, place) marketing mix
management (Varey, 2008). It is the development and maintenance of successful
relational interactions and entails interactive, constant, two –way connections among
customers and may also include other organizations, suppliers and other parties for
mutual benefit
Sheth and Parvatiyar (2005) highlight that a relationship marketing strategy must create a
higher value, for the consumer or for any other party, than the value derived from the
simple transaction of products at a given time. Consumers must perceive and appreciate
this value, which has been created through stable relationships with the supplier.
However, to correctly design and implement these strategies, it is vitally important to
know those aspects that make the customer perceive benefits from the established
3
relationship, given that by achieving this it is possible to cause a positive effect on
customer loyalty (Foxall, 2010).
Relationship marketing has often been contrasted to transaction marketing which is about
developing, selling and delivering products by means of short-term, discrete economic
transactions (Guenzi & Pelloni, 2004). The key characteristics of Relationship Marketing
include; every customer is considered an individual person or unit, activities of the firm
are predominantly directed towards existing customers, based on interactions and
dialogues, firms try to achieve profitably through the decrease of customer turnover and
strengthening of customer relationships (Ndubisi & Ling, 2007). When customers have
strong relationships with marketers, trust and commitment become critical focuses in the
formation of attitudes and beliefs and outweigh satisfaction in their re-patronage
decisions.
According to Navaroo and Torres (2004), the benefits that customers can obtain from
these stable relationships may center, for example, on an increase in confidence, the
reduction of risk, economic advantages, the simplification of and an increase of efficiency
in the decision process, social benefits and adaptability. The creation of relational
benefits for the customer will allow social ties to be established, which help to establish
stable relationships between the firm and the customer and which help to create value that
prevents the competition from taking the customer away (Sheth & Parvatiyar, 2005). The
benefits that customers can obtain from these stable relationships may centre, for
example, on an increase in confidence, the reduction of risk, economic advantages, the
simplification of and an increase of efficiency in the decision process, social benefits and
adaptability.
According to Kotler, (2008), a service is any activity or benefit that one party can offer to
another which essentially intangible and does not result in ownership or anything. Its
production may or may not be tied to a physical product. Services have a number of
distinctive characteristics which differentiate them from goods and have implications on
how they are marketed. They include intangibility, variability; perish ability and inability
to own a service. A service offer is analyzed in terms of two components i.e. the core
service which represent the core benefit and the secondary service which represents both
the tangible and augmented levels or additional benefits that go beyond the tangible
4
evidence. This is done to meet additional consumer wants and/or to further differentiate
the product from the competition (Palmer, 2001).
An integral part of service marketing is the fact that the consumption of a service is a
process consumption rather than outcome consumption (Palmer, 2001). The consumer or
user perceives the service production process as part of service consumption and not only
the outcome of a process as in traditional consumer packaged goods marketing. Thus,
service consumption and production have interfaces that always are critical to the
consumer’s perception of the service and to his or her long-term purchasing behavior
(Gronroos, 2004). These firms, which are related directly to the final consumers, enjoy
greater flexibility when carrying out visible actions that may lead to the creation and
development of stable relationships of co-operation with and long-term profits from the
customer, on an individual plane in which the customer feels identified and appreciated
by the firm.
The Interpersonal relationship built through recurrent interactions between a carrier and a
customer can strengthen the bond between them and finally lead to a long-term
relationship. Companies are not alone in desiring a sustained relationship. Many
customers wish to establish, develop and continue with a company an Interpersonal
relationship that provides value and convenience (Foxall, 2010). Therefore, relationship-
specific investment helps increase customers’ dependence, and thus magnifies the
switching barrier (Jones, Mothersbaugh, & Betty, 2006).
For most people interpersonal relationships do not come easily. They require effort,
consideration, thought and emotion. Similarly, in order for firms to develop and maintain
relationships with consumers they must consider relationship marketing as a long-term
process that requires constant monitoring and vigilance. Because of the myriad choices in
the marketplace today, even one bad experience with a firm can lead a consumer to try to
adopt a competitor. Through a more complete understanding of relationships, firms can
develop strategies to relate to consumers on a one to one basis. Marketing relationships,
like interpersonal relationships can be examined in phases. Courtship refers to the period
before the sale in which the firm and the consumer get to know each other. After the sale
is made, the relationship enters a maintenance phase. A relationship has the potential of
remaining in the maintenance phase for long periods of time, provided that the parties
5
continue to have their needs met by the arrangement. However, some relationships fail
and eventually dissolve. A general understanding of each of the phases of a relationship
can assist firms in managing their contacts with consumers.
According to Parmita and Zhao (2005), customer satisfaction generally means customer
reaction to the state of fulfillment, and customer judgment of the fulfilled state. There are
many benefits for a company from a high customer satisfaction level. It heightens
customer loyalty and prevents customer churn, lowers customers’ price sensitivity,
reduces the costs of failed marketing and of new customer creation, reduces operating
costs due to customer number increases, improves the effectiveness of advertising, and
enhances business reputation. The main factor determining customer satisfaction is the
customers’ own perceptions of service quality (Soderlund, 2008). Customer loyalty
provides the foundation of a company’s sustained competitive edge, and that developing
and increasing customer loyalty is a crucial factor in companies’ growth and performance
(Roger & Rolf, 2012). Customers experiencing a high level of satisfaction are likely to
remain with their existing providers and maintain their subscription.
From biblical Sampson, Pebbles Flintstone to Don King, hair has long been a source
power, beauty and attention. As such, it has never been enough to just let it hang there.
For centuries hair has been slathered, rinsed, pouffed and pinned for reasons cultural,
societal and personal (Dale, 2003). Hair care involves the activities of washing or cutting
or curling or arranging the hair to result in well-groomed, luxuriant, lustrous hair. People
speak of having a good or bad hair day. To combat that people have developed a
sophisticated arsenal of weaponry known as: hair styling. The service provided by hair
stylists. Sample of reported job titles: Cosmetologist, Hairstylist, Hair Stylist, Hairdresser,
Barber Stylist, Hair Dresser, Manager Stylist.
Tasks carried out by hair stylists involve Keep work stations clean and sanitize tools such
as scissors and combs. Cut, trim and shape hair or hairpieces, based on customers'
instructions, hair type and facial features, using clippers, scissors, trimmers and razors.
Analyze patrons' hair and other physical features to determine and recommend beauty
treatment or suggest hair styles. Bleach, dye, or tint hair, using applicator or brush.
Shampoo, rinse, condition and dry hair and scalp or hairpieces with water, liquid soap, or
other solutions. Operate cash registers to receive payments from patrons. Demonstrate
and sell hair care products and cosmetics. Develop new styles and techniques. Schedule
6
client appointments and Update and maintain customer information records, such as
beauty services provided. The services provided are unisex (Dale, 2003).
1.2 Statement of the Problem
There is need for mutual relationship between customers and business organizations.
Each has a meaningful and beneficial influence over the other and also reflects basic
reality on interdependence. Customers depend on business organizations for need
satisfying products and services in a healthy environment while business organizations
depend on customers for ideas, skills and money (Bojei and Aryaty, 2010). However, a
number of factors contribute to customers frustrations which water down these mutual
beneficial relationships.
Previous research acknowledges that emotional work such as display of friendliness
sometimes augment effectively the core product or service (Heidarzadeh and Firouzabadi,
2006) but agent friendliness has been explored primarily in the context of relatively
transient exchanges such as banks, convenience stores and supermarkets and as such the
perspective of the of consumers as co participants in the exchange has been
underrepresented (Rezai, 2009). This study will seek represent and bring out the
importance of consumers as co participants in the service exchange, secondly it will try
and bring agent friendliness as a co component in service delivery especially in hair
styling industry.
The study sought for a service context in which the marketing agent and client might
develop an interpersonal relationship from a commercial setting. Based on these
foundations, it seems appropriate to focus our attention on interpersonal relationships and
on their impact on customer satisfaction and loyalty towards a firm. This research will
study hairstylists and the way they look at the relationship they have with their clients.
The service delivery process is highly interactive, requiring inputs from both the hair
stylist and client (Nejad and Atoosa, 2005). It involves intimate proxemics, is relatively
extended in duration, is affectively charged and is repeated at semi-regular intervals over
time. Consumers mention hair salons when talking about valued relationships with
businesses.
7
1.3 General Objective
The General objective of this study was to determine the impact of interpersonal
relationships between service providers and client towards customer satisfaction.
1.4 Specific Objectives
The specific objectives were to;
1.4.1 Establish whether Interpersonal relationships result in Customer satisfaction.
1.4.2 Establish whether Interpersonal relationships result in overall Customer loyalty.
1.4.3 Establish whether Interpersonal relationships results in free publicity like good word
of mouth, referrals, and recommendations.
1.4.4 Establish whether Interpersonal relationships results in profitability for the firm.
1.5 Importance of the Study
1.5.1 Industry Player
The study was intended to create an understanding of the impact of interpersonal
relationships on customer satisfaction and loyalty in the hair styling industry. This study
will be of importance to the players in the hair styling industry in Kenya more so in
Nairobi. The study is hoped would benefit these numerous industry players to design
interactions and dealings with their consumers to increase the perceived value that would
in turn increase the customer’s loyalty to the said service provider.
1.5.2 Marketing Professionals
The study would also be very important for all practicing marketing professionals who
would appreciate the dynamics of the study will be bringing out and thereby enable them
apply some of the recommendations to enhance customer retention within their
respective industries.
1.5.3 Researchers and Academicians
The study would also be beneficial to other researchers and academicians that may use it
as a reference for further studies. Finally, as a practicing marketer in the field of
relationship marketing and a student of marketing, the study would be of invaluable
benefit to this researcher as a source of information and knowledge building.
8
1.6 Scope of the Study
The study was done in the Nairobi Central Business District. This study targeted Kenyan
Hairstylists in Nairobi within the Central Business District in Nairobi. According to the
latest records from the Yellow pages where they are classified hair and beauty salons.
There were 65 in number within the Central Business District. The stylists were
categorised into male and female saloons, the study considered selected stylists from both
the above sectors within the Central business district in Nairobi. At each stylist a senior
executive was identified and given questionnaire to answer. Data was collected in the
months of August and September. There was some difficulty in getting complete
information from the management of the salons because some matters such as finance are
quite sensitive to any organization. This definitely affected the outcome of the research
data. To counter this, the researcher assured the respondents of proprietary measures that
the findings were accorded and be used only for academic purpose and a copy was
availed to them upon their request.
1.7 Definition of Terms
1.7.1 Accessibility
The degree to which a form can reach intended target segments efficiently with its
products and communication (Ulrich, 2010).
1.7.2 Benefit
What a product feature can do for a particular customer (Bitner, Booms and Tetreault,
2010).
1.7.3 Brand loyalty
When customers purchase a specific brand all or most of the time (Durkin, 2005).
1.7.4 Competition
The alternative firms that could provide a product to satisfy a specific market needs
(Foxall, 2010).
9
1.7.5 Competitive advantage
A firm has a marketing mix that the target market sees as meeting its needs better than the
competitors marketing mix (Gronoos, 2008).
1.7.6 Core service
The essential nature of a service expressed in terms of the underlying need which it is
designed to satisfy (Guenzi & Pelloni, 2004).
1.7.7 Customer Expectations
The standard of service against which actual service delivery is assessed (Crosby, Evants
and Cowless, 2010).
1.7.8 Customer needs
The underlying forces that drive an individual to make a purchase and thereby satisfy his
or her needs (Ulrich, 2010).
1.7.9 Customer value
The unique combination of benefits received by target buyers that include quality, price,
convenience on time delivery and both before and after sales service (Bitner, Booms and
Tetreault, 2010).
1.7.10 Inseparability
The production of most services cannot be spatially or temporarily separated from their
consumption (Foxall, 2010).
1.7.11 Intangibility
Pure services present no tangibles cues which allow them to be assessed by the senses of
sight, sound, smell, taste or touch (Ulrich, 2010).
1.7.12 Marketing mix
The marketing manager’s controllable factors, the marketing actions of product, price,
promotion and place that he or she can take to solve a marketing problem (Gronoos,
2008).
10
1.7.13 Price
According to Colgate and Hedge (2011) price is the money or other consideration
exchange for ownership or use of a good or service.
1.7.14 Relationship marketing
Linking the organizations to its individual customers, employees, suppliers and other
partners for their mutual long-term benefits (Guenzi & Pelloni, 2004).
1.7.15 Service encounter
The period during which an organization’s human and physical resources interact with a
customer in order to create service benefits (Foxall, 2010).
1.7.16 Service process
The activities involve in producing a service which can be specified in the form of
blueprint (Crosby, Evants and Cowless, 2010).
1.7.17 Competitive advantage
In terms of Porter (1985) to achieve a business advantage over competitors by one of four
generic strategies.
1.7.18 Word of mouth
Word Of Mouth, also known as BUZZ has been defined as an infectious chatter; genuine
street-level excitement about a place, a product, thing or person (Williams and Visser,
2012).
1.8 Chapter summary
This chapter has provided a general introduction to the proposed research topic. It has
given background information on relationship marketing and impact of interpersonal
relationship on customer satisfaction and loyalty in the hair styling industry and then
stated the problem. The general and specific objectives of the study, importance of the
study and scope of the study have been highlighted. The study will benefit hair stylists
and other players within the wider service industry to understand impact of interpersonal
relationships with their clientele on the businesses they run. The study will also added to
11
the body of Knowledge available on Impact of interpersonal relationship on service
providers. The study covered Hair stylists based in Nairobi.
The next chapter therefore gives a discussion of impact of interpersonal relationship on
customer satisfaction, loyalty, in good referrals and recommendations and results in better
profitability for the firm. Chapter three presents the methodology that the study used in
carrying out this study. Chapter four presents the results and findings of the study while
chapter five presents the summary of findings, discussions, conclusions and
recommendations of the study.
12
CHAPTER TWO
2.0 LITERATURE REVIEW
2.1 Introduction
This chapter gives a framework of the paradigm and the review of issues relating to each
of the specific study objectives. The literature review discusses the relationship between
interpersonal relationship and customer satisfaction, customer loyalty and whether
interpersonal relationships results in free publicity like good word of mouth, referrals and
recommendations and finally whether interpersonal relationship with clients results in
overall increased profitability for the firm. Past studies on preceding aspects of
interpersonal relationships and relationship marketing will be highlighted.
2.2 Interpersonal Relationship and Customer Satisfaction
2.2.1 Firm-Customer Relationship
In the 1990s, the realization that understanding, meeting, and anticipating customer needs
was probably the most important source of sustained and competitive advantage for a
company had a decisive effect on the setting of corporate priorities and practices (Vavra,
2007). Customer satisfaction measures how well a supplier is doing with his/her present
market offering as perceived by existing customers which provides guidelines of action
for improving current products and services (Hennig-Thurau, Gwinner, Grmler and
Michael, 2005). Customer satisfaction can occur at multiple levels in an organization
from satisfaction with the contact person, satisfaction with core service to satisfaction
with the organization as a whole (Sureshandar, Rajendran and Anantharaman, 2012).
Customer Satisfaction can be described as the ultimate philosophical foundation of
modern marketing insofar as the marketing concept views the key to corporate success as
being in effectively identifying and satisfying customer needs better than the
competition. Both in practice and academic circles, the received wisdom is that customer
satisfaction is desirable business philosophy because satisfaction leads to important
customer cognitions and behaviors like loyalty, commitment and positive word of mouth
(Abdul-Muhmin, 2005). Customer Satisfaction is considered a prerequisite for customer
retention and loyalty and obviously helps in realizing economic goals like profitability,
market share return on investment (Hirankitti, Mechinda and Manjing, 2009).
13
It has been suggested that firms can leverage firm-customer relationship to gain
privileged information about customers’ needs and in turn provide more satisfactory
offerings than competitors (Ndubisi, 2007). Relationship marketing strategy, apart from
its ability to help understand customers’ needs, can also lead to customer loyalty and cost
reduction. The underlying principle behind relationship marketing is that organizations
can enhance customer satisfaction through a relationship and in so doing can enhance
their own performance. For such benefits to accrue, relationships must be developed and
managed to the customer’s satisfaction. Customer satisfaction can be described as the
degree of overall pleasure or contentment felt by the customer, resulting from the ability
of the service to fulfil the customer’s desires, expectations and needs in relation to the
service (Heiller, Geursen, Carr and Rickard, 2013).
Buyers’ satisfaction is a function of the closeness between buyer’s expectations and the
product’s perceived performance. If it falls short of expectations the customer is
disappointed; if it meets expectations the customer is satisfied, it exceeds expectations,
the customers is delighted. These feelings make a difference in whether the customer
buys the product again and talks favorably or unfavorably about it to others (Kotler,
2007). According to Sureshandar, Rajendran and Anantharaman (2012), customer
satisfaction comprises of the following five factors; core service or service product,
human element of service delivery, systematization of service delivery; non-human
element, tangibles of services scales and social responsibility.
Satisfaction with a service provider is seen as an antecedent of relative attitude because
without satisfaction consumers will not hold a favorable attitude towards the service
provider compared to other alternatives available (Kotler, 2007). To be judged positively,
a service must perform well on most dimensions, whereas to be judged negatively, poor
performance on one or just a few dimensions is sufficient (Ofir and Simonson, 2011).
According to research customer Satisfaction is mainly influenced by the disconfirmation
paradigm (Wua, Lianga, Tungb and Changc, 2008). This paradigm states that’s the
customer’s feeling of satisfaction is a result of comparison process between perceived
performance and one or more comparison standard, such as expectations. The customer is
satisfied when she/she feels that the product’s performance is equal to what was expected
(confirming). If the product’s performance is equal to what was expected expectations.
14
The customers if very satisfied (positively disconfirming) if it remains below expectations
the customer will be dissatisfied (negatively disconfirming) (Lovelock and Wirtz, 2007).
Repetitious purchasing behavior may be as a result of a market structures in which buyers
find themselves with few alternatives or where available alternatives can only be obtained
at a high cost in terms of breaking current ties with suppliers (Kotler, 2007). Customer
loyalty has been considered as an important source of long-term business success and
building a relationship with a customer is a good way to retain loyal customers in the
long-term. Loyal customers continue to purchase the service, generate long term revenue
streams, tend to buy more, and may be willing to pay premium prices, all of which
increase revenue and profitability. Repetitious behavior does not imply that customers are
satisfied.
2.2.2 Customer Retention
Customers who were just ``satisfied'' may be significantly less loyal than delighted
customers, (Wong and Sohal, 2006). Given that a large proportion of delighting outcomes
were the result of service recovery. Customer retention has been shown to have a direct
impact on revenue and profitability. Furthermore customers who have been successfully
recovered not only remain loyal but can become advocates for the organization. Customer
retention has been shown to have a direct impact on revenue and profitability.
Furthermore since negative word of mouth is likely to result from customer
dissatisfaction, not satisfying complaining customers may have a potentially greater
negative effect on business earnings than that which is lost through the customer alone
key benefit of complaint management is that complaints can also be used to support the
drive for continuous improvement by focusing managerial attention on specific problem
area (Heidarzadeh and Firouzabadi, 2006).
2.2.3 Service Quality
Service quality and customer satisfaction are commonly recognized as pivotal
determinants of long-term business success (Busaca and Padula, 2005). According to
(Gronroos, 2008), service quality has been found to be a multidimensional construct that
is composed of two sets of attributes: structure and process. “Structure” refers to the
physical environment and physical facilities in which the service occurs while “Process”
15
refers to the interaction with service personnel within that environment during the service
performance. Structure satisfaction is the healthcare consumer’s assessment of the
structure characteristics or various tangible elements associated with a particular
healthcare service which includes both the physical environment and physical facilities in
which the service occurs, as well as billing procedures and other amenities such as food
and parking. During a health care encounter, the healthcare consumer is exposed to a
variety of stimuli (i.e. service attributes) that are cognitively processed and help to shape
the consumer’s satisfaction (Oliver, 2007).
The proposed relationship of perceived value upon customer satisfaction is supported by
value disconfirmation experience. When a single purchase of a product or service is
made, the customer expects to receive a benefit greater than the cost, that is, the customer
expects to receive value. If anything happens after the purchase that unexpectedly reduces
or increases the cost incurred or benefit received, the perceived value is altered
(Heidarzadeh and Firouzabadi, 2006). Therefore, the cumulative customer satisfaction is
an overall evaluation based on the total purchase and consumption experience with a
good or service over time (O’zer and Arasil, 2005).
Thus, a number of key areas that needs to be considered if the customer is to be served
satisfactorily have been prescribed. One of these key areas is to leverage firm-customer
relationship to gain privileged information about customers’ needs and thereby serve
them satisfactorily. Relationship marketing therefore, strives to get the firm close to the
customers in order to enable it to accurately and adequately discern and satisfy their needs
(Ndubisi 2007). Regardless as to what business leaders may be trying to implement in
their companies, any employee interacting with customers is in a position either to
increase customer satisfaction or put it at risk. Employers in such positions should
therefore have the skills to respond effectively and efficiently to customer needs
(Hansemark and Albisson, 2014).
2.2.4 Satisfied Internal Customers
By building quality relationship with customers, organizations can satisfy them better
than competitors by capitalizing on a richer understanding of customer needs. Besides
building quality relationships, banks can create customer satisfaction by exhibiting
16
trustworthy behaviour, showing genuine commitment to service, communicating
information to customers efficiently and accurately, delivering services competently, and
handling potential and manifest conflicts skillfully (O’zer and Arasil, 2005).
According to Guenzi and Pelloni (2014), Customer’s interpersonal relationships with
front-line employees are a very important component of the overall offering of the service
provider, not only because they positively affect customer satisfaction and loyalty
towards the firm, but also because they can be a powerful tool for reducing the risk of
customers’ switching behaviors when other customers leave the service provider. The
importance of service personnel in the success of the service encounter and in the service
recovery effort has constantly been cited in the literature. According to Carnage (2005),
satisfied internal customers increasingly satisfy external customers. For service
companies the quality of the relationships between customers and front line employees,
which incorporates both a professional and social dimension, can strongly contribute to
the customer’s overall perception of quality of the service provider (Guenzi and Pelloni,
2014).
The managerial implications of this include; in personnel selection, great emphasis should
be placed on empathetic skills and interpersonal attitudes of prospective front-line
employees, training should be focused on increasing relational skills of contact
employees, reward systems should be based, at least to some extent, on employees’
contribution in fostering customer satisfaction and loyalty and finally, the service
provider should place high attention to the design of facilities layout, the blueprinting of
the fruition processes, the organization of peripheral services (such as social events) in
order to maximize the interpersonal interaction opportunities between front-line
employees and customers (Guenzi and Pelloni, 2014).
Providing friendly professional courteous service that is consistent, fair and reliable is one
of the best ways to establish and maintain customer relationships (Zeithaml and Bitner,
2013). Research has shown that service quality has a strong effect on the potential start of
a relationship: it has a positive effect on customers’ repurchase intentions (loyalty), which
leads to more interactions and/or transactions (Ventis and Ghauri, 2004).
17
While there are a variety of approaches to the explanation of customer
satisfaction/dissatisfaction, the most widely used is the one proposed by Richard Oliver
who has developed the expectancy disconfirmation theory. According to this theory,
which has been tested and confirmed in several studies, customers purchase goods and
services with pre-purchase expectations about anticipated performance. Once the product
or service has been purchased and used, outcomes are compared against expectations.
When outcome matches expectations, confirmation occurs. Disconfirmation occurs when
there are differences between expectations and outcomes. Negative disconfirmation
occurs when product/service performance is less than expected. Positive disconfirmation
occurs when product/service performance is better than expected. Satisfaction is caused
by confirmation or positive disconfirmation of consumer expectations, and dissatisfaction
is caused by negative disconfirmation of consumer expectations (Oliver, 2007).
Finally, there is an argument that the more satisfied the customer is with his/her
interpersonal relationship to the service employee, the more likely she/he is to share
personal information (Hansemark and Albinsson, 2014). This focuses on satisfaction with
the relationship to the employee. While a large amount of previous satisfaction research
has focused on the satisfaction with the outcome of the relationship (i.e. the quality of the
service). There will be concentration on how satisfied the customer is with the
relationship per se. This distinction is based on two arguments: one, we believe that the
concept of outcome satisfaction to a large extent is covered by the credibility variable
previously described. Second, as service encounters are intrinsically social by nature
(Oliver, 2007) there will be argument that an important aspect often neglected in service
research is the customer’s satisfaction with the relationship shared with the employee.
Thus, the focus on the relationship itself first, and its outcome.
2.3 Interpersonal Relationship and Customer Loyalty
The relevance of the business strategy centered on retaining customers by making them
brand-loyal is due to the existing conviction that it is more profitable to maintain
customers, thereby seeking profitability on the long-term horizon, than attracting new
customers, given that there is a significant difference in terms of the This customer
loyalty leads to better business results, to the extent that a base of loyal customers causes
a decrease in the marketing costs, provides an excellent communication route for lifting
the company image, makes it difficult for the competition to have access and allows
18
setting higher prices (Lytle and Timmerman, (2006). Nevertheless, it is undisputed that
customers cannot be made brand-loyal if they are not satisfied, wherefore the policies
directed at improving customer satisfaction and their brand-loyalty become strategic
decisions for most service firm (Vavra, 2007)
2.3.1 Switching Costs
Customer loyalty represents a competitive asset as well as a basis for increasing prices
and generating barriers to market entry. This fact is especially true for those firms that
have been in a market for years and where this market is mature, meaning that there is a
general feature of null or reduced growth (Vavra, 2007). Therefore, in an attempt to
discourage switching and to solidify longer-term working relationships with current
customers, business suppliers nowadays simultaneously build exit barriers and manage
value perceptions to strategically retain buyers (Liu, 2006).
As such, business service marketers have found it advantageous to build “exit barriers”
through enhancing customers’ perception of high “switching costs”. Switching costs are
primarily solidified by business suppliers through “hard assets”, such as installed
proprietary equipment, software programs, etc, that cannot be transferred to other
exchange relationships (Liu, 2006). The penalty price to be paid for abandoning one
provider in favor of another is referred to as the switching cost to the customer. It is a
crucial factor, because it fosters customer loyalty and enables the firm to be less
influenced by fluctuations in the level of service quality in the short term (Aydin, O’zer
and Arasil, 2005). Perceived switching costs are defined here as a buyer’s perception of
the costs associated with terminating a current service provider and establishing a new
relationship with the replacement service provider. Since most business functions are
essential to a firm’s overall operation, an organizational buyer often needs to pre-select a
workable replacement supplier before terminating a current supplier. As such, perceived
switching costs should include both past investments lost and the potential adjustment
costs in establishing a new relationship with the replacement (Burnham et al., 2008).
According to Patterson (2007), barriers to customer defection include strong interpersonal
relationships, a lack of alternative suppliers from which to choose, set-up costs or
financial penalties for early defection, all represent a cost (psychological, economic) that
acts as a disincentive or deterrent to customers changing service suppliers. In other words,
19
under certain conditions a customer might be less than satisfied with a service supplier,
but still continue to deal with that firm because the costs of leaving are perceived to be
too high. The costs (time, inconvenience) of searching for a new service provider, the loss
of a friendly and comfortable relationship; having to bear learning cost; explain individual
preferences (and educating a new provider about personal preferences); risk perceptions;
loss of special privileges all moderate the nature of the relationship between satisfaction
and repeat purchase.
Procedural switching cost stems from the process of buyer decision-making and the
customer’s implementation of the decision. The five-stage process entails need
recognition, information search, evaluation of alternatives, purchase decision and post-
purchase behavior (Aydin, O’zer and Arasil, 2005). Switching costs include not only
those that can be measured in monetary terms but also the psychological effect of
becoming a customer of a new firm, and the time and effort involved in buying new
brand. Hence, switching cost is partly consumer-specific. Switching cost confers some
advantages on firms, with a direct effect on customer loyalty level. It is generally much
more profitable to retain existing customers than continually see to recruit new customers
to replace lapsed ones (Kotler, 2007).
Switching costs based on buyers not wanting to relearn business procedures or develop
new personal relations, although non-monetary, can prevent buyers from searching for
alternatives and from jumping ship (Burnham et al., 2008). Switching costs are costs
associated with switching to another service supplier. When switching costs are high, loss
of customers to competitors is less likely as long as the service recovery solves the
service failure (Cranage, 2005). Therefore, for business service providers wanting to
increase customer retention levels, identifying strategic actions that may result in
customer perceptions of high switching costs is paramount (Burnham, 2008).
Patterson (2007) argues that it is the value that customers feel they receive, rather than
their level of satisfaction, that keeps them returning. As a result, several researchers
suggest that customer value may be an important predictor of switching behavior. In order
to secure new customers from available prospects, there has to be a reason why they want
to switch to your organization or product. Your organization therefore has to be perceived
to be giving more value to customers as compared to competition. Value is the result of a
20
cognitive comparison process. Customers’ perceived value in business markets as the
trade-off between the multiple benefits and sacrifices of a supplier’s offering as perceived
by key decision-makers in the customer’s organization and taking into consideration the
available alternative suppliers’ offerings in a specific use situation (Colgate and Hedge,
2011). Research in the areas of customer value and service value suggests that superior
value maybe an effective predictor of strong customer loyalty, repeat business, and
switching behavior and that it is the value that customers feel they receive, rather than
their level of satisfaction , that keeps them returning. As a result, several researchers
suggest that customer value may be an important predictor of switching behavior (Liu,
2006).
2.3.2 Brand Loyalty
Therefore, in order to make customers brand-loyal, a firm must offer an effective and
affective relationship that allows the creation of personal and social ties with customers.
These ties, together with the financial ties, are currently one of the most appropriate
elements for achieving loyal customers (Navarro, Iglesias and Torres, 2005). As such,
business service marketers have found it advantageous to build “exit barriers” through
enhancing customers’ perception of high “switching costs” (Liu, 2006). According to
Navarro, Iglesias and Torres, (2005) brand-loyalty strategies must be based on the
relational benefits for the customers that allow them to make the best purchase decision,
save time, enjoy convenience and develop a friendly and close relationship with the
supplier, given that they will allow the firm to increase customer satisfaction, their loyalty
and the favorable word-of-mouth communication that these customers may make in their
surroundings.
Fornell (2012) noted potential problems associated with relying on switching barriers.
First, customer awareness of switching costs may actually impede customer acquisition;
and second, switching costs may be neutralized by external forces (e.g. a competitor who
provides guarantees that minimize perceived risk, or educates customers about how to
make easy, direct comparisons between providers, thus reducing search costs). This latter
point emphasizes that firms must still vigilantly pursue their customer satisfaction efforts.
Liu (2006) also urges caution in creating switching barriers in lieu of satisfaction,
claiming it won’t work in the long term because dissatisfaction may be ongoing; and
21
customers may feel they have no control (and thus become resentful) if they perceive
themselves to be “locked in”. If dissatisfaction is ongoing then a “retained” customer may
still spread negative word-of-mouth and even engage in sabotage (Patterson, 2007).
A number of studies have focused in service switching in specific industries was ,
however, due to some limitations of generalization, Keaveney (2005), adopted a broader
cross industry perspective when she conducted a study of 45 different services. The
model that she developed depicted eight factors that were influential in service switching
behavior in a range of service industries. Prominent switching factors are pricing,
inconvenience, core service failure, service encounter failure, response to service failure,
competition, ethical problems and involuntary switching (Patterson, 2007).
Keaveney (2005) presented eight major reason or causes behind service switching
behavior. They included: pricing (high price, price increases, unfair pricing and/or
deceptive pricing); inconvenience (location or hours, and/or wait times); core service
failure (service mistakes, billing errors and/or service catastrophes); service encounter
failures (uncaring, impolite, unresponsive and unknowledgeable staff); responses to
service failure (negative responses, no response, and/or reluctant response); competition
(found better service elsewhere); ethical problems (cheating, and/or conflict of interest);
and involuntary switching (“unavoidable breakdown”) (Ndubisi and Ling, 2007).
Defecting customers send a clear signal of reduced market share and profit slump ahead
to the organization. Costs rise as company attempts to recruit new customers. In fact the
cost of recruiting new customers is said to be as much as five times more than costs in
retaining existing customers. This is due to increased costs of advertising, personal selling
, setting up new accounts, explaining business procedures to new customers, and the costs
associates with inefficient dealings during the customer’s learning process (i.e. the staff
customer interaction during the early stages of delivery, when new customers are learning
about the service (Guenzi and Pelloni, 2014).
Defecting customers send a clear signal of reduced market share and profit slump ahead
to the organization. Costs rise as company attempts to recruit new customers In fact the
cost of recruiting new customers is said to be as much as five times more than costs in
retaining existing customers. This is due to increased costs of advertising, personal
22
selling, setting up new accounts, explaining business procedures to new customers, and
the costs associates with inefficient dealings during the customer’s learning process (i.e.
the staff customer interaction during the early stages of delivery, when new customers are
learning about the service (Guenzi and Pelloni, 2014).
As customer tenure lengthens, the volumes purchased grow and customer referrals
increase. Simultaneously, relationship maintenance costs fall as both customer and
supplier learn more about each other. Because fewer customers churn, customer
replacement costs fall. Finally, retained customers may pay higher prices than newly
acquired customers, and are less likely to receive discounted offers that are often made to
acquire new customers. All of these conditions combine to increase the net present value
of retained customers.
2.4 Interpersonal Relationship and Free Publicity Word of Mouth
Word of Mouth, also known as BUZZ has been defined as an infectious chatter; genuine
street-level excitement about a place, a product, thing or person (Rosen, 2005) Positive
word of mouth (WOM) communication has been recognized as a particularly valuable
vehicle for promoting a firm's products and services. Word of mouth has for long been
recognized as a powerful force affecting consumer choice, loyalty and switching Florian
and Bayo, (2007). Potential customers high in functional risk could also be asked to
contact experts about the superiority of the company’s service, and customers high in
social/psychological risk perception could be suggested to refer to people in their peer
group, which they perceive as being similar to themselves.
Especially two source characteristics, expertise and similarity, have been identified and
tested in previous research as determining the interpersonal influence, and thus, the effect
of WOM referrals. First, the source-attractiveness model suggests that receivers can better
identify with sources that are similar to themselves (Vavra, 2007). Festinger’s (1954)
theory of social comparison proposes that people tend to compare their attitudes and
capabilities with those of others. The tendency to compare oneself with another person
increases as this person is seen to be similar to oneself, because, according to Festinger
(1954), individuals implicitly assume that similar people have similar needs and
preferences. It seems obvious that information obtained from an expert should be
23
especially influential. Bojei and Aryaty (2010) argue that someone who is an expert in a
particular product category should dispose of more product- or purchase-related
information in this field and therefore his/her opinion will be sought more often than the
opinion of others. Furthermore, the greater knowledge base of experts should enable them
to convince others more effectively of their opinion on products and brands. Empirical
studies show that experts are more often opinion leaders in a product category than
others. Others often copy their decisions, because they are perceived to be of higher
quality (Bojei and Aryaty, 2010).
IT has been suggested (Ndubisi, 2007) that loyal customers are valuable communicators
of favorable word-of-mouth about organisations or products to which they feel loyal. As
evangelists, they can attract new customers for the organization and may even increase
their own consumption collectively to the benefit of its sales, revenue and profit.
Loyalists can also serve as useful sources of new product ideas.
It is therefore important that effective conflict resolution mechanisms are not only in
place but are proactive, so as to pre-empt potential sources of conflict and address them
before problems become manifest. Effective reactive solutions should also be marshalled
decisively and in time to resolve problems and protect customers from avoidable losses.
Sometimes, what may cause a customer to defect is not so much the occurrence of a
problem as how it is handled. Banks should be willing to discuss problems openly with
their customers (Ndumbisi, 2007)
Even with the renewed interest in WOM communication, antecedents to WOM have
received little attention (Anderson, 2006). Regrettably, the limited discussions in the
literature of how firms can encourage positive WOM behavior have tended to concentrate
on reward dispensing strategies or assumed that satisfying customers will naturally lead to
these behaviors. As such, the opportunity for employee-customer relational bonds to
influence customer WOM behavior has been ignored.
Before examining the constructs relevant to the study, a brief example is offered from
Harley-Davidson to illustrate the impact of interpersonal bonds on WOM communication.
Much of the success of Harley-Davidson can be attributed to positive WOM
communication emanating from customer-employee relationships. Despite the
24
corporation's impressive track record of growth and profitability, relatively little is
budgeted for traditional marketing expenditures. Instead, Harley pursues a genuine
relationship marketing approach focused on its dealers and their employees. Through its
customer clubs, known as the Harley Ownership Groups or HOGS, over one-half million
customers frequent the dealerships for weekly meetings, special events, vehicle service,
and the purchase of clothing and accessories. Dealer employees are overtly encouraged
by management and corporate leaders to ``get to know these customers personally,
demonstrate attention and care, and become their friends'' basically develop working
interpersonal relationships (van der Sande, 2006). The bonding between employees and
customers has been so successful in spreading positive WOM communication that Harley
has no need for substantial expenditures on advertising and promotions.
The production of output WOM is widely thought to be an outcome of customer
experiences with a product or service. The disconfirmation paradigm of customer
satisfaction/dissatisfaction predicts that in most commercial contexts when a customer’s
expectations are met satisfaction will be experienced, when expectations are
underperformed there will be dissatisfaction and when expectations are exceeded there
will be customer delight (Oliver, 2007). Satisfaction and delight, it is believed, motivate
positive WOM. There is some evidence from the service sector that delight is less likely
to be associated with ‘right first time’ service delivery than it is with excellent recovery
following service failure (TARP, 2006) and it has been estimated that it is generally cost-
effective for management to invest twice the profit margin associated with a sale to
recover a dissatisfied customer (Fornell and Wernerfelt, 2006). Similarly, negative WOM
can be conceptualized as an outcome of an unsatisfactory imbalance between
expectations and perceptions.
It seems plausible to infer that positive WOM is associated with performance above that
which was predicted and negative WOM with performance below that which was wanted.
Westbrook (2007) reported that WOM is mediated by satisfaction levels. Swan and
Oliver (2009) reported that (positive) WOM increases as satisfaction increases. Engel et
al. (2009), however, contended that emotional response to product/service performance
evokes WOM directly. There is some early evidence that WOM is driven not only by
product-service performance but by dis-satisfaction with the purchasing process (Tanner,
2006). Hartline and Jones (2006) concluded that intention to utter WOM is correlated
25
with the customer’s perceptions of value and quality. The higher those perceptions the
stronger the intention of uttering positive WOM. The stronger of the two correlates is
value. Given that certain components of the service delivery process signal ‘value’ to
customers, it makes sense for management to isolate these dimensions and develop them
to promote referrals.
People tell others about a product or a service because it somehow relates to their lives,
invisible networks have always been important in the diffusion of certain services or
products, in order to compete companies must understand that they are not selling to
individual customers but to networks of customers (Rosen, 2005). In his book information
anxiety, Richard Wurman argues that a “weekday edition of New York Times contains
more information than the average person was likely to come across in a lifetime in
seventeen century England.” To protect themselves, consumers filter out most of the
messages they are exposed to from the mass media. They do however listen to their
friends. Research shows that most of customers share a similar sense of skepticism.
According to a survey by the public relations firm Porter Novelli, only 37 percent of the
public considers information that comes from a software company “very or somewhat
believable.”
In this study, there will be hypothesized and empirical tests to the proposition that
interpersonal relationships between employees and customers can significantly influence
positive WOM communication. For many services, an important component of the
offering is the interpersonal interaction between employees and customers (Foxall, 2010)
or what according to Garbarino and Johnson (2009) referred to as interpersonal bonds.
Scholars have suggested that customers who are members of a firm's social network are in
situations where relationship closeness exists (Colgate and Hedge, 2011).
One key dimension of the employee-customer relationship is interpersonal trust, or
confidence in an employee's reliability and integrity (Ulrich, 2010). We contend that as a
customer's trust increases in a specific employee (or employees), positive WOM
communication about the organization is more likely to increase. In our proposed model,
we argue that such trust is a consequence of three other interpersonal relationship
dimensions: familiarity between employees and customers, a personal connection
between employees and customers (Hennig-Thurau, Gwinner, Grmler and Michael,
26
2005). Finally, there is content that both personal connection and care are consequences
of employee familiarity of customers (Abdul-Muhmin, 2005).
2.5 Interpersonal Relationship and Profitability
The objective of the marketing activities of firms in the for-profit sector is to obtain a
profit. Therefore, contributing the aforementioned relational benefits to the customer must
be linked with contributing profitability to the firm in the medium- and long-term. The
relevance of the business strategy centred on retaining customers by making them brand-
loyal is due to the existing conviction that it is more profitable to maintain customers,
thereby seeking profitability on the long-term horizon, than attracting new customers,
given that there is a significant difference in terms of the budget (Burnham, Ye and
Singh, 2008).
Getting the balance right and retaining customer’s makes good economic sense. There is a
high correlation between customer retention and company profitability according to the
US strategy consulting firm Bain & Company. Its recent research showed that a 5 per cent
increase in customer retention leads to a considerable rise in net present value profits: this
increase can be as much as 125 per cent for a credit card company and 50 per cent for an
insurance broker. Nobody is pretending that a 5 per cent increase in customer retention
will be easy to obtain, but even a 1 per cent increase could yield considerable
improvement in profitability.
Bain and Company’s calculation of profitability is based on the expected cash flow over a
customer’s lifetime – the longer they stay, the more profits they bring the company. What
is more, customers typically generate increasingly more profit each year they stay with
the company. Retaining customers allows the company to develop a deeper relationship
with them and encourages repeated and increasingly frequent buying activity. Customer
defections have a surprisingly powerful impact on the bottom line. As a customer’s
relationship with the company lengthens, profits rise (Reichheld and Sasser, 2006).
2.5.1 Competitive Advantage
The building of a strong customer relationships has been suggested as a means for gaining
competitive advantage (Fornell, 2012). The underlying assumption of much of the
27
existing research is that long term relationship are desirable because they more profitable
for the firm than short term relationships. This assumption has been attributed to greater
exchange efficiencies which are created by customer retention economies (Sheth and
Parvatiyar 2005). Following this line of reasoning, we expect a substantial positive
association between the duration of a customer-firm relationship and the firm’s profits
derived thereof. Customers don’t buy products or services, but they buy the benefits that
the product or a service can offer to them. They buy offerings that consist of products,
services, information and other factors. The value created from the purchase of an
offering is dependent on how the customer experiences the benefits created (Grönroos
2007).
Customer satisfaction can be developed on its own without any effort, but usually it needs
work and planning. Customer satisfaction is a competition and tool, the competitive
advantage received from customer satisfaction is hard to duplicate for other companies,
especially if the company devotes more effort into their customer service than their
competition. If the company’s personnel have outstanding personal chemistry, empathy,
helpfulness and they can offer other pleasant gestures towards the customers, qualities
that are hard to imitate for other companies. Even the ability to apologize or react
correctly to negative feedback can indicate a sense of professionalism to the customer and
that the customer is taken seriously (Lahtinen & Isoviita 2008). For many companies the
situation nowadays is that their core competence needs to be refined into a service
offering to develop their competitiveness and that the offering consists of all the value
creating items that customers expect (Grönroos, 2007).
To make relationship marketing work, marketers have started to adopt a customer
management orientation, which emphasizes the importance of customer lifetime analysis,
retention and the dynamic nature of a person’s customer-firm relationship over time
(Kotler, 2007). First, a better understanding is needed of the facets of a customer
management orientation, for example firms that adopt a customer management
orientation need to consider how their activities impact their relationship with different
customers.
Anderson and Narus (2006) note that every industry is characterized by its bandwidth of
transactional and relational exchanges. Garbarino and Johnson (2009) show that short and
28
long term oriented customers differ in the factors that determine their future exchanges.
Their results imply that a focus on customer satisfaction is likely to be effective for weak
relational customers whereas marketing that is focused on building trust and commitment,
features of good interpersonal relationship is more effective for long term relational
group. The issue gains further added importance given Reinartz and Kumar’s (2008)
findings that both long term and short term customers can be profitable. Workplaces
benefit if workers have good relationships. In other words, in years when people are said
to be the only true competitive advantage, it is evident that interpersonal relations in
organizations and processes of nourishing them have become essential for the
organizational success.
When the customer becomes a regular customer through positive experiences of the
company’s services the amount of visits usually rises due to the ease of the usage of the
services. The company has the personal data of the customer and knowledge how to
please the customer more efficiently; this also lowers the barriers towards the usage of the
services. The customer does not want to go through the effort of switching the service
provider and to go through all the steps to achieve the same position in the competing
company again, this creates a competitive advantage for the company. The cost of the
customer relationship decreases the longer the relationship is an increase of only 5
percent customer retention results in 25-100 percent profit on each customer (Ylikoski,
2010).
There are many benefits that a company can achieve through customer satisfaction, not
only monetary benefits but also intangible benefits. When a regular customer is being
served, the time used in the process is much shorter than the time used with a new
customer and the risk of misunderstandings decreases. This will make the customer more
satisfied and the communion between the customer and the personnel more relaxed.
When the company’s personnel are able to serve happy customers, the atmosphere within
the entire company raises the rate of satisfaction of the employees with it. When the
employees of the company are satisfied, they tend to expend more effort in serving the
customers and keeping the customers satisfied, making a cycle of satisfaction. The
company needs to make the first effort in achieving the cycle (Ylikoski, 2010).
29
Consequently, there is need for a more rigorous empirical analysis evidence on the life-
time profitability relationship. For example, long life customers expect value added
relationships in order to buy more products (Mohs, 2007). Otherwise their expenditure
can be lower. In contrast short term customers might not form any expectations of value
added relationships and therefore will have no inhibitions about buying products from the
vendor.
Lifetime analysis have been conducted in contractual settings (Bolton, 2008) examples of
this type of relationships are magazine subscriptions and cellular telephone services. In
contractual settings, expected revenues can be forecast fairly accurately, and given
constant usage of service, increasing cumulative profits over the customers’ lifetime
would be expected. However in non-contractual setting, the firm must ensure that
relationship stays alive, because the customers typically split their category expenses
among several firms (Dwyer, 2007). Examples for non-contractual settings are
department stores and Hairstylists.
If a company can communicate this value in financial terms to its employees they will
give more thought to ensuring that customer satisfaction is achieved. Staff of Domino’s
Pizza in the US are taught to see every pizza customer as having $5,000 tattooed on their
forehead – the amount they would spend over the next ten years if they bought two $5
pizzas a week (Bolton, 2008). It is not enough simply to tell staff that customers are
valuable – they must be able to quantify it and visualize it.
There are several reasons why retaining customers is so profitable: Sales and marketing
and set-up costs are amortized over a longer customer lifetime; Customer expenditure
increases over time; Repeat customers often cost less to service; satisfied customers
provide referrals; Satisfied customers may be prepared to pay a price premium (Dwyer,
2007).
Not all of these reasons may apply to a particular service business but overall they
represent a significant opportunity for most service sector companies to improve profit.
Customer retention also helps predict the profitability of the company and is therefore an
excellent management tool for considering the success of quality and customer service
programmes (Dwyer, 2007).
30
There is another important reason to remember: a customer lost through dissatisfaction
with the service provider will be one gained by a competitor (Bolton, 2008). Keeping
customers is therefore a key strategic issue for service companies to address.
2.6 Chapter Summary
This chapter presented past discussions on the impact of interpersonal relationships on
customer satisfaction, customer loyalty, free publicity like good word of mouth, and
referrals and recommendations and profitability for the firm. Customer satisfaction is a
desirable business value because it leads to important customer behaviors like loyalty,
commitment and positive word of mouth. It is a requirement for customer retention and
loyalty and aids in realizing economic goals like profitability, market share return on
investment. Loyal customers are valuable communicators of favorable word-of-mouth
which helps to attract new customers for the organization and may even increase their
own consumption to the benefit of its sales, revenue and profit. The reason why customer
retention derived from initiatives like relationship marketing is due is that it is more
profitable to maintain customers. Getting the balance right and retaining customer’s
makes good economic sense since there is a high correlation between customer retention
and company profitability. The next chapter presents the methodology which the study
used in carrying out the study.
31
CHAPTER THREE
3.0 RESEARCH METHODOLOGY
3.1 Introduction
This chapter covers the research methodology that was used in this study. The chapter
gives the specific procedures that were followed in undertaking the study. It consists of
research design, population, sampling design as well as data collection methods and data
analysis.
3.2 Research Design
The research was designed as a descriptive study of Hair Stylists in Nairobi. According to
Key (1997), a descriptive study seeks to obtain information concerning the current status
of the phenomena, to describe “what exists” with respect to variables or conditions in a
situation and to establish association between variables. The objective of descriptive
research is developing careful description of patterns with respect to some phenomenon
or suggestive ideas. This may result into inter-subjective descriptions that may be used in
arriving at conclusions or in development of explicit theory. The study also sought to
relate impact of interpersonal relationship on service providers, more so in the hair styling
industry by use of a statistical test of independence.
The use of descriptive design was also necessitated by the need to determine the
characteristics of hair stylists that could be used for classification purposes. These
characteristics were then used to classify them as taking advantage of the interpersonal
relationship that they had with their clients.
3.3 Population and Sampling Design
3.3.1 Population
A population is defined by Bryman and Bell, (2003) as a well-defined or set of people,
services, elements, and events, group of things or households that are being investigated.
The study consisted of all Hair Stylists in Nairobi central business District. A sample of
hairstylists was selected from the Kenya yellow pages and studied using a stratified
sampling technique from the population of the Hair Stylists within the Central Business
32
District (CBD) in Nairobi. In every hair stylist practitioner, a senior management
executive was selected for the purpose of the study. Such an executive was considered a
unit in the population.
3.3.2 Sampling Design
3.3.2.1 Sampling Frame
According to Kombo and Tromp (2006) a sampling frame is the list from which the
sample is drawn. Ideally, the sample frame should be the target population. The study
included sampling frame which was derived from a list of all licensed Hair Stylists in
Central Business District of Nairobi.
3.3.2.2 Sampling Technique
This is the method used in drawing the sample from a population in a way that the sample
selected is representative of the population (Cooper and Schindler, 2003). There are
several techniques used for coming up with a sample size, namely convenience,
judgement, simple random sampling, stratified random sampling and cluster sampling.
Simple random sampling was used for this study. According to Kothari (2007) this
technique gives every respondent among the accessible population a chance of
participating equally.
3.3.2.3 Sample Size
A sample is according to Cooper & Schindler, (2006) is a small subset of the population
that has been chosen to be studied it is the number of cases or entities in the sample
studied. Mugenda and Mugenda (2003) define a sample as the smaller group obtained
from the accessible population. A simple random sample of 30 hair stylists was used for
this study.
3.4 Data Collection Methods
This study used primary data. Data was collected by use of questionnaires. The
questionnaire was developed using the key variables identified as factors service provider
from their relationship with clients. The questionnaire was closed and open ended
33
questions and it had five sections. Section one contained demographic information,
section two contained interpersonal relationship and customer satisfaction, section three
contained interpersonal relationship and customer loyalty, section four contained
interpersonal relationship and free publicity and section five contained interpersonal
relationship and profitability.
3.5 Research Procedures
The questionnaire was pre-tested on a small sample of two senior executives at two
different arbitrarily selected agencies. The pilot testing was performed to ensure clarity
and to reduce the possibility of respondents misunderstanding the questions. After pre-
testing, corrections arising out of this exercise were made and the actual survey then
proceeded. Executives were called beforehand and informed about the questionnaire, an
appointment was made on when to drop the questionnaire and finally called back to pick
after it had been filled. The executives were informed that a copy of the research findings
would be given to them free of charge to encourage participation.
3.6 Data Analysis Methods
Before processing the responses given, data preparation was done on the completed
questionnaires by editing, coding, entering and cleaning the data. Questionnaires were
coded and keyed into statistical package for social science (SPSS Version-21.0) analysis
software using the following procedure; data sorting, data, editing, data coding, data
entry, data cleaning, data processing and interpretation of results. The data was then
analyzed using descriptive technique which is the art of collecting, organizing and
summarizing data through frequencies and percentages. The data analysis tool used was
the Statistical Package for Social Sciences (SPSS) version 21. The results were presented
by use of tables.
3.7 Chapter Summary
Here, the research methodology which was used to carry out the study was discussed.
The study used a non-random convenience survey in order to answer questions posed by
the specific objectives. Data used for this study was obtained at through the
questionnaire. Descriptive design was used to assist in determining the characteristics of
hair stylists. The sampling frame was derived from the Yellow Pages that had a list of
34
registered hair salons in the CBD. Conveniences sampling and a sample size of 30 was
also used. Questionnaires were used and were developed using the key variables
identified as the impact of the factors derived by service provider from their relationship
with clients. The questionnaire had both closed and open ended questions. However
before they were used, they were pre-tested to determine if they were effective in
collecting the desired information. The next chapter presents the results and findings of
the study.
35
CHAPTER FOUR
4.0 RESULTS AND FINDINGS
4.1 Introduction
This chapter’s objective is to present and explain the data derived after the analysis of
questionnaires on the basis of the specific objectives of the study. Data collected was both
qualitative and quantitative in nature. Quantitative data was analyzed using Statistical
Program for Social Sciences (SPSS). Frequency distribution and percentages were used to
present the data. The findings are presented on the bases of the specific objectives of the
study which were to; establish whether Interpersonal relationships result in customer
satisfaction; establish whether Interpersonal relationships result in overall customer
loyalty; establish whether Interpersonal relationships results in free publicity like good
word of mouth, referrals, and recommendations and establish whether interpersonal
relationships results in profitability for the firm.
4.2.1 Response Rate
From the study, 30 of the 30 sample respondents filled in and returned the questionnaires
contributing to 100 percent. This is a reliable response rate for data analysis as Mugenda
and Mugenda (2008) pointed that for generalization a response rate of 50 percent is
adequate for analysis and reporting, 60 percent is good and a response rate of 70 percent
and over is excellent. The response rate was reached due to the data collection procedure
adopted by the study, where research assistants were involved in administering of
questionnaires and waited for respondents to fill in, kept reminding the respondents to fill
in the questionnaires through frequent phone calls and picked the questionnaires once
fully filled.
4.2 Demographic Information
4.2.1 Gender of the Respondents
The respondents were asked to indicate their gender. According to Table 4.1, 60 percent
of the respondents were female while 36.7 percent were male. Non-response rate was
3.3%. This implies that most of the hair stylists were female.
36
Table 4.1 Gender of the Respondents
Gender Frequency Percent
Male 11 36.7%
Female 18 60.0%
Non- response 1 3.3%
Total 30 100%
4.2.2 Highest Level of Education
The rationale for this question was to establish the respondent’s highest level of
education. According to the analysis in Table 4.2, 76.7 percent were educated up to
college level, 10 percent to university and 6.7 percent up to high school. Non-response
rate was 6.7 percent. This finding illustrates that most of the hair stylists were educated
up to college level and therefore were capable of giving reliable information.
Table 4.2 Respondent’s Highest Level of Education
Highest Level of Education Frequency Percent
University 3 10.0%
College 23 76.7%
High school 2 6.7%
Non-response 2 6.7%
Total 30 100%
4.2.3 Gender of Clientele
The effort here was to establish the gender of the respondent’s clients. According to table
4.3, 73.3 percent of the respondents served both male and female clients, 20 percent
served women, 3.3 percent served male. The non-response rate was 3.3 percent. This
shows that majority of the stylists served both male and female.
37
Table 4.3 Gender of Clientele
Gender Frequency Percent
Male 1 3.3%
Female 6 20.0%
Both Male and Female 22 73.3%
Non-response 1 3.3%
Total 30 100%
4.2.4 Number of clients served in a day
The respondents’ were asked to indicate how many clients they serve in a day. On
average 20 customers were served in a day.
4.3 Interpersonal Relationship Result In Customer Satisfaction
This question sought to establish to what extent respondents agreed that the listed factors
contributed to customer satisfaction. The respondents were asked to rate to what degree
they agreed that the factors contributed to customer satisfaction.
4.3.1 Addressing Customers by Name
Here the study asked the respondents to indicate to what extent they agreed that
addressing customers by name lead to customer satisfaction. According to table 4.4
below, 70 percent of the respondents strongly agreed that addressing customers by name
lead to customer satisfaction. 26.7 percent agreed. Non-response was 3.3 percent. This
infers that addressing customers by name lead to customer satisfaction.
Table 4.4 Addressing Customer’s by Name Leads to Customer Satisfaction
Level of Agreement Frequency Percent
Agree 8 26.7%
Strongly Agree 21 70.0%
Non-response 1 3.3%
Total 30 100%
38
4.3.2 Knowledge of Customer’s Families
This sought to establish to what extent knowing about clients’ families affected customer
satisfaction. According to table 4.5 below, 56.7 percent strongly disagreed, 20 percent
agreed while 6.7 percent disagree and strongly agreed respectively. Therefore majority of
the respondents disagreed that knowing about clients’ families lead to customer
satisfaction.
Table 4.5 Knowledge of Clients’ Families Leads to Customer Satisfaction
Level of Agreement Frequency Percent
Strongly Disagree 17 56.7%
Disagree 2 6.7%
Uncertain 3 10.0%
Agree 6 20.0%
Strongly Agree 2 6.7
Total 30 100%
4.3.3 Knowledge of Client’s Work
The effort here was to establish to what extent respondents agreed that knowing about
their client’s occupation lead to customer satisfaction. According to table 4.6, 33.3
percent agreed 26.7 percent were uncertain while 16.7 percent strongly disagreed and
disagreed respectively. This implies that having knowledge of the customer’s occupation
does not lead to customer satisfaction.
Table 4.6 Knowledge of Client’s Work Leads to Customer Satisfaction
Level of Agreement Frequency Percent
Strongly Disagree 5 16.7%
Disagree 5 16.7%
Uncertain 8 26.7%
Agree 10 33.3%
Strongly Agree 2 6.7
Total 30 100%
39
4.3.4 Client’s Promises
Here the study sought to establish whether keeping client’s promises lead to customer
satisfaction. According to table 4.7 below, majority of the respondents strongly agreed
that keeping customer promises lead to customer satisfaction i.e. 86.7 percent. However
6.7 percent were uncertain and agree respectively. This infers that keeping promises made
to customers leads to customer satisfaction.
Table 4.7 Keeping Client’s Promises Leads to Customer Satisfaction
Level of Agreement Frequency Percent
Uncertain 2 6.7%
Agree 2 6.7%
Strongly Agree 26 86.7%
Total 30 100%
4.3.5 Caring and individualized attention
The respondents were asked to indicate to what extent the agreed that caring and
individualized attention leads to customer satisfaction. According to table 4.8, 80 percent
strongly agreed, 16.7 percent agreed while 3.3 percent were uncertain. This shows that
caring and individualized attention leads to customer satisfaction.
Table 4.8 Caring and individualized attention leads to Customer Satisfaction
Level of Agreement Frequency Percent
Uncertain 1 3.3%
Agree 5 16.7%
Strongly Agree 24 80.0%
Total 30 100%
4.3.6 Responsiveness/Willingness to help
The aim of this question was to establish to what degree respondents agreed that
responsiveness/willingness to help lead to customer satisfaction. According to the table
40
4.9, 70 percent strongly agreed 20 percent agreed while 10 percent were uncertain. This
illustrates that responsiveness/willingness to help lead to customer satisfaction.
Table 4.9 Responsiveness/ willingness to help leads to customer satisfaction
Level of Agreement Frequency Percent
Uncertain 3 10.0%
Agree 6 20.0%
Strongly Agree 21 70.0%
Total 30 100%
4.3.7 Staff Reliability
The effort here was to establish to what extent respondents felt that staff reliability
resulted in customer satisfaction. The findings are shown in Table 4.10 below. According
to the findings 66.7 percent of the respondents strongly agreed that reliability of the
members of staff lead to Customer Satisfaction. 16.7 percent agreed, 10 percent were
uncertain while 6.7 percent disagreed. This implies that reliability of the members of staff
lead to Customer Satisfaction.
Table 4.10 Staff reliability leads to Customer Satisfaction
Level of Agreement Frequency Percent
Disagree 2 6.7%
Uncertain 3 10.0%
Agree 5 16.7%
Strongly Agree 20 66.7%
Total 30 100%
4.3.8 Customer Retention and Loyalty
The respondents were asked to indicate to what extent they felt that customer retention
and loyalty lead to customer satisfaction. According to the Table 4.11 below, 73.3
percent of the respondents strongly agreed, 16.7 percent agreed 3.3 percent disagreed
while non-response rate was 6.7 percent. This infers that customer retention and loyalty
lead to customer satisfaction.
41
Table 4.11 Satisfied customer results in Customer retention and loyalty
Level of Agreement Frequency Percent
Disagree 1 3.3%
Uncertain 5 16.7%
Agree 22 73.3%
Strongly Agree 2 6.7%
Total 30 100%
4.3.9 Relationship Marketing Helps in Learning about Need and Wants
The effort here was to establish whether respondents agreed that relationship marketing
helps to gain privileged information about Customer’s needs and wants which in turn
leads to more satisfactory offers than competitors. According to 4.12 below, 50 percent of
the respondents strongly agree, 40 percent agree, 3.3 percent were uncertain. Non-
response rate was 6.7 percent. This implies that relationship marketing helps to gain
privileged information about Customer’s needs and wants which in turn leads to more
satisfactory offers than competitors
Table 4.12 Gain privileged information about customer needs and wants
Level of Agreement Frequency Percent
Uncertain 1 3.3%
Agree 12 40.0%
Strongly Agree 15 50.0%
Non-response 2 6.7%
Total 30 100%
4.3.10 Satisfaction and Repeat Purchase
This question’s effort was to establish satisfaction results in repeat purchase. The
respondents were asked to rate to what degree they agreed with the statement. According
to table 4.13 below, 73.3 percent of the respondents strongly agreed that Satisfaction
results in repeat purchase.23.3 percent agree while non-response rate was 3.3 percent.
This shows that satisfaction results in repeat purchase.
42
Table 4.13 Satisfaction results in repeat purchase
Level of Agreement Frequency Percent
Agree 7 23.3%
Strongly Agree 22 73.3%
Non-response 1 3.3%
Total 30 100%
4.3.11Customer’s Favorable Talk about Business
The effort here was to establish that Customer’s feedback lead to favorable talk about the
respondent’s business. According to the analysis in Table 4.14, 50 percent of the
respondents strongly agreed that satisfaction results in Customers favorably taking about
the business while 26.7 percent agreed. Furthermore, 20 percent were uncertain and non-
response rate was 3.3 percent. This illustrates that Customer’s feedback lead to favorable
talk about the respondent’s business.
Table 4.14 Satisfaction results in Favorable talk about the business.
Level of Agreement Frequency Percent
Uncertain 6 20.0%
Agree 8 26.7%
Strongly Agree 15 50.0%
Non-response 1 3.3%
Total 30 100%
4.3.12 Impact of Customer Retention and Revenue and Profitability
Here the study sought to determine whether the Customer Retention had an impact on
Revenue and profitability of the respondents’ businesses. The results from the study have
been represented in the Table 4.15 below show that 66.7 percent of the respondents
strongly agree, 23.3 percent agreed 3.3 percent disagreed with the statement. Non-
response rate was 6.7 percent. This infers that customer retention had an impact on
revenue and profitability of the hair stylists’ businesses.
43
Table 4.15 Customer retention impacts revenue and profitability
Level of Agreement Frequency Percent
Disagree 1 3.3%
Agree 7 23.3%
Strongly Agree 20 66.7%
Non-response 2 6.7%
Total 30 100%
4.3.13 Satisfied Internal Customers
In this subject, the objective was to establish whether satisfied employees actually lead to
satisfied customers the results of which have been presented in Table 4.16 below.
According to the findings 60 percent of the employees strongly agreed that satisfied
employees increasingly satisfied external customers. 30 percent agreed while 3.3 percent
were uncertain disagree and strongly disagreed respectively. This implies that satisfied
employees actually lead to satisfied customers.
Table 4.16 Satisfied Internal Customer Increasingly Satisfy External Customers
Level of Agreement Frequency Percent
Strongly Disagree 1 3.3%
Disagree 1 3.3%
Uncertain 1 3.3%
Agree 9 30.0%
Strongly Agree 18 60.0%
Total 30 100%
4.3.14 Quality Relationships Contribute to Perception of Quality
The information sought here was to determine that quality relationships between
customers and front line employees can contribute greatly to the Customer’s overall
perception of quality of the service provider. The subsequent findings were presented in
the Table 4.17 below, where it can be seen that 43 percent of the respondents agreed and
strongly agreed respectively. 10 percent disagreed while 3.3 percent strongly disagreed.
44
This indicates that quality relationships between customers and front line employees can
contribute greatly to the Customer’s overall perception of quality of the service provider.
Table 4.17 Perception Of Quality Of The Service Provider
Level of Agreement Frequency Percent
Strongly Disagree 1 3.3%
Disagree 3 10.0%
Agree 13 43.3%
Strongly Agree 13 43.3%
Total 30 100%
4.3.15 Employee Incentive Scheme
The effort here was to establish whether the respondents had employee incentive schemes
in their organizations. The findings are shown in Table 4.18 below where 73.3 percent
said they had one in place, 23.3 percent did not have. Non-response rate was 3.3 percent.
This implies that the hair stylists had employee incentive schemes in their organizations.
Table 4.18 Employee incentive scheme for excellent work done
Frequency Percent
Yes 22 23.3%
No 7 73.3%
Non-response 1 3.3%
Total 30 100%
4.4 Interpersonal Relationships and Customer Loyalty
Interpersonal relations resulting to overall customer loyalty was considered in this study,
and which was subjected to the survey are: Specific research questions were raised and
whose findings were analyzed.
4.4.1 Tracking Customer Visits
This question sought to establish whether respondent;’ tracked customer visits. According
to the findings represented in Table 4.20 below, 83 percent of the respondents indicated
that they tracked customer visits 13.3 percent did not track while non-response rate 3.3
45
percent. This finding shows that the hair stylists tracked customer visits and therefore
would be able to tell whether customers were loyal to the business.
Table 4.19 Tracking customer visits
Frequency Percent
Yes 25 83.3%
No 4 13.3%
Non-response 1 3.3%
Total 30 100%
4.4.2 Tracking System
Here the objective was to establish the kind of tracking systems the respondents had to
track customer visits. According to table 4.20 below, 70 percent of the respondents
pointed out that they have a manual tracking system in place for tracking customer visits.
6.7 percent have a computerized system while 3.3 percent used both manual and
computerized systems. Only 3.3 percent had other tracking systems besides manual and
computerized systems. This shows that majority of the hair stylists used manual tracking
system for tracking customer visits.
Table 4.20 Type of Tracking System
Frequency Percent
Manual Tracking system 21 70.0%
Computerized tracking system 2 6.7%
Other 1 3.3%
Non-response 5 16.7%
Both Manual and Computerized 1 3.3%
Total 30 100%
4.4.3 Loyalty Program
The effort was to establish whether the respondents had loyalty programs in place.
According to Table 4.21, 56.7 percent of the respondents have a loyalty program in place
while 36.7 percent did not have one in place. Non-response rate was 6.7 percent. This
implies that most of the hair stylists had a loyalty program in place.
46
Table 4.21 Customer Loyalty Program
Frequency Percent
Yes 17 56.7%
No 11 36.7%
Non-response 2 6.7%
Total 30 100%
4.4.4 Complaint System
The objective of this question was to establish whether the respondents had customer
complaint system in place. According to Table 4.22 below, 83.3 percent of the
respondents had a complaint system in place while 10 percent did not have one in place.
Non-response rate was 6.7 percent. This illustrates that majority of the hair stylists had a
complaint system in place.
Table 4.22 Customer Complaint System
Frequency Percent
Yes 25 83.3%
No 3 10.0%
Non-response 2 6.7%
Total 30 100%
4.4.5 Type of Complaint System
This was to capture information on the type of complaint systems the respondents had in
place. According to the findings 43.3 percent indicated that they customers informed the
manager, 33.3 percent suggestion box and 3.3 percent had other forms of customer
complaints systems in place. However, non-response rate was 13.3 percent. This is
illustrated in Table 4.23 above. The findings indicates that most of the hair stylists’
customers informed the manager of their complaints.
47
Table 4.23 Type of Complaint System
Frequency Percent
Suggestion box 10 33.3%
Inform the manager 13 43.3%
Others 1 3.3%
Non-response 4 13.3%
2 6.7%
Total 30 100%
4.4.6 Profitability Retention Vis- a Vis Recruitment
This subject was concerned with whether it is more profitable to retain existing customers
than continually recruit new ones. The finding were represented in Table 4.24 below,
where 36.7 percent of the respondents strongly agree that it is more profitable to retain
existing customers than continually recruit new ones. 33.3 percent agreed while 10
percent were uncertain and strongly disagreed respectively. This implies that it is more
profitable to retain existing customers than continually recruit new ones.
Table 4.24 Customer retention against Customer Recruitment
Level of Agreement Frequency Percent
Strongly Disagree 3 10.0%
Disagree 2 6.7%
Uncertain 3 10.0%
Agree 10 33.3%
Strongly Agree 11 36.7%
Non-response 1 3.3%
Total 30 100%
4.4.7 Value Predictor of Switching Behavior
In this case, the researcher purposed to establish the results that the value derived by
customer may be a predictor of switching behavior. According to Table 4.25 below, 43.3
percent of the respondents agreed, 23.3 percent strongly agreed, 16.7 percent were
uncertain and 3.3 percent strongly disagreed and disagreed respectively. This infers that
the value derived by customer may be a predictor of switching behavior.
48
Table 4.25 Value derived as a Predictor of Switching Behaviour
Level of Agreement Frequency Percent
Strongly Disagree 1 3.3%
Disagree 1 3.3%
Uncertain 5 16.7%
Agree 13 43.3%
Strongly Agree 7 23.3%
Non-response 3 10.0%
Total 30 100%
4.4.8 Recognition
On whether the respondents felt that recognition is a very important factor in retaining
customers, the research question brought out that that is a very important factor in
customer retention. As shown in table 4.26 below 73.3 percent of the respondents feel
that recognition is a very important factor in retaining customers. 13.3 percent of the
respondents felt that it was important and 3.3 percent were neutral. Non-response rate was
3.3 percent. This shows that recognition is a very important factor in retaining customers.
Table 4.26 Recognition as a Reason why Individual Would Switch Salons
Frequency Percent
Neutral 1 3.3%
Important 4 13.3%
Is very important 22 73.3%
Non-response 3 10.0%
Total 30 100%
4.4.9 Service Failure
The researcher sought to determine whether response after Service failure is very
important factor in retaining customers. From The findings in Table 4.27 below it is quite
evident that service failure is a very important factor in retaining customer as rate by 46.7
percent of the respondents. Minority felt it’s not important or somehow important
respectively. Non-response rate was 6.7 percent. The finding implies that service failure
is a very important factor in retaining customers.
49
Table 4.27 Customers switch salons after service failure
Frequency Percent
Not Important 1 3.3%
Somehow important 1 3.3%
Important 12 40.0%
Is very important 14 46.7%
Non-response 2 6.7%
Total 30 100%
4.4.10 Awareness/Publicity of Competitors
The effort here was to establish whether awareness/publicity is an important factor a
customer would switch salons. According to Table 4.28 below, 40 percent of the
respondents felt that it was an important factor, 23.3 percent felt it was very important 3.3
percent felt it was somehow important and not important respectively. This means that
awareness/publicity is an important factor a customer would consider to switch salons.
Table 4.28 Customers Switch Salons due Competitor Awareness or Publicity
Frequency Percent
Not Important 1 3.3%
Somehow important 1 3.3%
Neutral 7 23.3%
Important 12 40.0%
Is very important 7 23.3%
Non-response 2 6.7%
Total 30 100%
4.4.11 Interpersonal Relationships with Employees
This was to check if interpersonal relationships with employees were important in
retaining customers. The results in Table 4.29 indicated that 46.7 percent felt that
interpersonal relationships with employees were important in retaining customers. 30
percent felt it was very important, 10 percent somehow important. 3.3 percent were
50
neutral and felt it was not important. Non-response rate was 6.7 percent. This indicates
that interpersonal relationships with employees were important in retaining customers.
Table 4.29 Customers interpersonal relationships with employees
Frequency Percent
Not Important 1 3.3%
Somehow important 3 10.0%
Neutral 1 3.3%
Important 14 46.7%
Is very important 9 30.0%
Non-response 2 6.7%
Total 30 100%
4.4.12 Experimentation
The research question endeavored to determine whether experimentation was an
important factor in retaining customers. According to the findings 36.7 percent were
neutral that experimentation is an important factor in retaining customers. 23.3 percent
felt I was very important 20 percent important, 6.7 percent somehow important. Non-
response rate was 3.3 percent. This analysis is shown in Table 4.30 below. This affirms
that experimentation is an important factor in retaining customers.
Table 4.30 Experimentation and switching of customers to other salons
Frequency Percent
Not Important 3 10.0%
Somehow important 2 6.7%
Neutral 11 36.7%
Important 6 20.0%
Is very important 7 23.3%
Non-response 1 3.3
Total 30 100%
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4.5 Interpersonal Relationships and Free Publicity
The motivation of this subject was an endeavor to establish whether interpersonal
relationships resulted in free publicity like good word of mouth, referrals and
recommendations. The questionnaire here dwelled on specific research questions
4.5.1 Current Customer as Reference
The study sought to reveal whether current customers were used as references. The results
in Table 4.31 below give the respondents opinion that current customers are used as
references evidenced by 76.7 percent indicating ‘yes’ 13.3 percent responded no and non-
response rate was 10 percent. This implies that current customers were used as references.
Table 4.31 Current Customers as References
Frequency Percent
Yes 23 76.7%
No 4 13.3%
Non-response 3 10.0%
Total 30 100%
4.5.2 Reward Scheme
Here, information regarding the existence of an employee rewards system in the
respondents’ organizations. According to Table 4.32 below, there was a positive response
to the subject with 80 percent of the respondents indicating yes. This shows that there was
existence of an employee rewards system in the hair stylists’ organizations.
Table 4.32 Reward System for introducing new Customers
Frequency Percent
Yes 24 80.0%
No 5 16.7%
Non-response 1 3.3%
Total 30 100%
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4.5.3 Multiple Accounts
Here, information regarding the customer having multiple accounts was being sought.
The respondents surveyed provided the following outcome as presented in Table 4.33.
The information in the table show a positive response to the subject with 86.7 percent
who admitted to having customers who have multiple accounts. This shows that there
were customers who had multiple accounts.
Table 4.33 Customers with Multiple Accounts
Frequency Percent
Yes 26 86.7%
No 3 10.0%
Non-response 1 3.3%
Total 30 100%
4.5.4 Preferential Rate
The question here was to reveal whether the customers who had multiple accounts
enjoyed preferential rates. The subsequent findings were presented in the Table 4.34
where 87 percent of the respondent’s clients enjoy a preferential rate because of having
multiple accounts, Non-response rate was 13.3 percent. This infers that customers who
had multiple accounts enjoyed preferential rates.
Table 4.34 Customers with Multiple Accounts Enjoy Preferential Rates
Frequency Percent
Yes 26 86.7%
Non-response 5 13.3%
Total 30 100%
4.5.5 Positive Word of Mouth
In this subject, the objective was to establish relationship marketing results in positive
word for the business, the results of which have been presented hereby in Table 4.35.
According to the table, 66.7 percent of the respondents strongly agreed that relationship
marketing is successful in spreading positive word of mouth. 26.7 percent agree while 6.7
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percent disagree. This asserts that relationship marketing is successful in spreading
positive word of mouth.
Table 4.35 Positive Word of Mouth
Frequency Percent
Disagree 2 6.7%
Agree 8 26.7%
Strongly agree 20 66.7%
Total 30 100%
4.5.6 Trust and positive word of mouth
The researcher sought to establish whether customer’s trust results in positive word of
mouth. According to Table 4.36, 60 percent of the respondents strongly agree that as a
customer’s trust increases with employees in a firm, positive word of mouth
communication about the organization is more likely to increase. 33.3 percent agree. This
implies that indeed as a customer’s trust increases with employees in a firm, positive
word of mouth communication about the organization is more likely to increase.
Table 4.36 Customer’s trust results in positive word of mouth
Frequency Percent
Strongly Disagree 1 3.3%
Disagree 1 3.3%
Agree 10 33.3%
Strongly agree 18 60.0%
Total 30 100%
4.6 Interpersonal Relationships and Firm Profitability
4.6.1 Speed
Here the study sought to determine whether speed was a factor that increased a hair
stylist’s profitability. The results from the study have been represented in the Table 4.37
below. The findings mirrors a positive response at 86.7 percent rating speed as a very
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good factor followed by 6.7 percent rating speed as both good and fair respectively. This
implies that speed was a factor that increased a hair stylist’s profitability.
Table 4.37 Speed Increases Hair Stylist’s Profitability
Frequency Percent
Fair 2 6.7%
Good 2 6.7%
Very good 26 86.7%
Total 30 100%
4.6.2 Safety
The information sought here was to rate safety as a factors that increases a hair stylist’s
profitability. According to Table 4.38 66.7 percent of respondents feel that Safety is a
very good factor that increases a hair stylist’s profitability. 30 percent felt that it is a good
factor while 3.3 percent safety as fair. This shows that safety is a very good factor that
increases a hair stylist’s profitability.
Table 4.38 Safety increases hair stylist’s profitability
Frequency Percent
Fair 1 3.3%
Good 9 30.3%
Very good 20 66.7%
Total 30 100%
4.6.3 Reliability
This was to capture information on whether respondents felt that reliability is a good
factor that increases hair stylist’s profitability. According to the findings 76.7 percent of
the respondents felt that it is a very good factor that influenced an organization’s
profitability. This analysis is shown in Table 4.39 below. This finding indicates that
reliability is a good factor that increases hair stylist’s profitability.
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Table 4.39 Reliability
Frequency Percent
Good 7 23.3%
Very good 23 76.7%
Total 30 100%
4.6.4 Flexibility
This research question attempted to establish whether respondents felt that flexibility was
factor to consider in order to increase a hair stylist’s profitability. The respondents felt
that it was a very good factor to consider in order to increase a hair stylist’s profitability.
The results have been presented in Table 4.40. This means that flexibility is a factor to
consider in order to increase a hair stylist’s profitability.
Table 4.40 Flexibility results in hair stylist’s profitability
Frequency Percent
Fair 5 16.7%
Good 8 26.7%
Very good 17 56.7%
Total 30 100%
4.6.5 Affordability
This subject was concerned with whether affordability impacted hair stylists’
profitability. The percentage distribution of the respondents rated affordability as a very
good factor to consider in order to increase a hair stylists’ profitability was 43.3 percent.
Table 4.41 present the results. This infers that affordability impacted hair stylists’
profitability.
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Table 4.41 Affordability results in hair Stylist’s Profitability
Frequency Percent
Fair 6 20.0%
Good 9 30.0%
Very good 13 43.3%
Non-response 2 6.7
Total 30 100%
4.6.6 Accessibility
The researcher purposed to establish whether accessibility affect a hair stylist’s
profitability. According to Table 4.42 below, 70 percent of the respondents agreed to the
claim that accessibility was a very good factor to consider increasing a hair stylist’s
profitability. This indicates that accessibility affect a hair stylist’s profitability.
Table 4.42 Accessibility Results in Hair Stylists’ Profitability
Frequency Percent
Fair 4 13.3%
Good 3 10.0%
Very good 21 70.0%
Non-response 2 6.7%
Total 30 100%
4.6.7Customer Care
The researcher further sought to establish whether Customer Care increased hair stylist’s
profitability. According to Table 4.43 below, on whether Customer Care increased hair
stylist’s profitability, respondents felt that it was a very good factor to consider. An
impressive 96 percent of the respondents rated it as a very good factor, while 3.3 percent
rated it a good factor to consider. This therefore shows that customer care increased hair
stylist’s profitability.
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Table 4.43 Customer Care results in hair stylist’s profitability
Frequency Percent
Good 1 3.3%
Very good 29 96.7%
Total 30 100%
4.6.8 Maintaining long term relationships
The researcher sought to determine whether a firm benefited more from maintaining long
term relationships than a short term relationships. The findings as shown above show a
positive response that is 63.3 percent of the respondents who strongly agreed while 30
percent agreed. The results are presented in Table 4.44. This illustrates that firms benefit
more from maintaining long term relationships than a short term relationships.
Table 4.44 Benefit from Maintaining Long term Relationships
Level of Agreement Frequency Percent
Strongly Disagree 1 3.3%
Agree 9 30.0%
Strongly Agree 19 63.3%
Non-response 1 3.3%
Total 30 100%
4.5.9 Customer Defections
According to the Table 4.45 56.7 percent of the respondents agreed that customer
defections have an impact on the bottom line. 33.3 percent strongly agreed, 3.3 percent
strongly disagree and disagreed respectively.
Table 4.45 Benefit from less customer defections
Level of Agreement Frequency Percent
Strongly Disagree 1 3.3%
Disagree 1 3.3%
Agree 17 56.7%
Strongly Agree 10 33.3%
Non-response 1 3.3%
Total 30 100%
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4.6.10 Company profits
The research question endeavored to determine whether customer’s relationship with the
Company lengthens profits rise. According to Table 4.46, 56.7 percent of the respondents
felt that customer’s relationship with the Company lengthen profits rise. 30 percent
agreed while 10 percent were uncertain. Non response was 3.3 percent. This means that
customer’s relationship with the Company lengthens profits rise.
Table 4.46 Company profits lengthen
Level of Agreement Frequency Percent
Uncertain 3 10.0%
Agree 9 30.0%
Strongly Agree 17 56.7%
Non-response 1 3.3%
Total 30 100%
4.6.11 Competitive advantage
The study sought to explore whether customer relationship is a source of competitive
advantage. The Table 4.47 below exhibits a rather positive response as 66.7 percent of the
respondents strongly agreed, 26.7 percent agreed while 3.3 percent were uncertain. Non-
response was 3.3 percent. This therefore means that customer relationship is a source of
competitive advantage.
Table 4.47 Source of Competitive advantage
Level of Agreement Frequency Percent
Uncertain 1 3.3%
Agree 8 26.7%
Strongly Agree 20 66.7%
Non-response 1 3.3%
Total 30 100%
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4.6.12 Profitable
This aspect endeavored to establish that long term relationships are profitable. 46.7
percent of the respondents strongly agreed and agreed respectively that long term
relationships are profitable. Non response rate was 3.3 percent. The results are shown in
Table 4.48 below. The finding implies therefore that long term relationships are
profitable.
Table 4.48 Long term relationships are profitable
Level of Agreement Frequency Percent
Disagree 1 3.3%
Agree 14 46.7%
Strongly Agree 14 46.7%
Non-response 1 3.3%
Total 30 100%
4.5.13 Low maintenance
The study desired responses on the general comment whether customers who are
converted and retained in committee relationships are relatively low maintenance.
According to Table 4.49 30 percent of the respondents were uncertain, 26.7 percent agree
while 23.3 percent strongly agreed. Non response was 3.3 percent. This implies that
customers who are converted and retained in committee relationships are relatively low
maintenance.
Table 4.49 Low Maintenance
Level of Agreement Frequency Percent
Strongly Disagree 3 10.0%
Disagree 2 6.7%
Uncertain 9 30.0%
Agree 8 26.7%
Strongly Agree 7 23.3%
Non-response 1 3.3%
Total 30 100%
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4.6.14 Repeat and Frequent Buying
It emerged from the findings that respondents strongly agree that relationship encourages
repeated and increasingly frequent buying activity. 53.3 percent of the respondents
strongly agreed, while 26.7 percent agreed. The findings are shown in Table 4.50. This
shows that relationship encourages repeated and increasingly frequent buying activity
thereby increasing profitability.
Table 4.50 Encourage Repeat and Increase Frequent Buying Activity
Level of Agreement Frequency Percent
Strongly Disagree 1 3.3%
Disagree 3 10.0%
Uncertain 1 3.3%
Agree 8 26.7%
Strongly Agree 16 53.3%
Non-response 1 3.3%
Total 30 100%
4.5.15 Premium price
This was to check whether satisfied customers are prepared to pay a premium price. The
results indicated that 50 percent strongly agreed that the satisfied customer are willing to
pay a premium price while 30 percent agreed. These results are shown in the Table 4.51
below. This implies that customers are prepared to pay a premium price.
Table 4.51 Prepared to pay Premium Price
Level of Agreement Frequency Percent
Disagree 2 6.7%
Uncertain 3 10.0
Agree 9 30.0%
Strongly Agree 15 50.0%
Non-response 1 3.3%
Total 30 100%
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4.6 Chapter Summary
In summary, data analysis as purposed was the core of this chapter. Basic sections have
been scrutinized in view of the specific objectives mentioned in chapter one. Key
elements for the specific research questions as tailored to these sections have been
summarized in the respective tables and subsequently presented in either Figures or
graphs where appropriate. Discussions of the findings have been covered in the
succeeding chapter upon which conclusions and finally recommendations were drawn.
The next chapter will present the summary of the research findings, discussions,
conclusions and recommendations.
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CHAPTER FIVE
5.0 DISCUSSION CONCLUSION AND RECOMMENDATIONS
5.1 Introduction
The purpose of the chapter is to discuss and summarize the findings of the study and
finally give conclusions and recommendations, for improvement or practice. It is also
important to note that all this will be done with justification from the data that was
collected and analyzed.
5.2 Summary
The General objective of this study was to determine the impact of interpersonal
relationships between service providers and client towards customer satisfaction. The
specific objectives were to establish whether Interpersonal relationships result in
Customer satisfaction, overall Customer loyalty, in free publicity like good word of
mouth, referrals, and recommendations and to results in profitability for the firm.
Descriptive research design was used in the study. The target population of the study
consisted of all Hair Stylists in Nairobi central business District. Simple random
sampling was used to come up with the sample used for this study. Before actual data
collection was started a pilot study was done to detect weakness in design and
instrumentation and to provide proxy data or selection of a probability sample.
Respondents were drawn from the target population and replicated that which would be
used for data collection. The data was then analyzed using descriptive technique. The data
analysis tool used was the Statistical Package for Social Sciences (SPSS) version 21. The
results were presented by use of tables.
According to the data analyzed in this study, interpersonal relationships lead to customer
satisfaction. The factors in interpersonal relationships that lead to customer Satisfaction
and which the respondents strongly agreed include addressing customers by their names,
knowing about their families, knowing about the clients work or what they do for a living,
keeping client’s promises, caring and individualized attention to the customers,
responsiveness/willingness to help and staff reliability. Further the study revealed that
satisfaction results in repeat purchase. The study also revealed that satisfied employees
actually lead to satisfied customers.
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The study revealed that customer satisfaction lead to customer retention and loyalty. The
study also revealed that quality relationships between customers and front line employees
can contribute greatly to the Customer’s overall perception of quality of the service
provider. The study further revealed that the stylists tracked customer visits using manual
tracking system. The study revealed that the hair stylists had a loyalty program in place.
The study also revealed that recognition, service failure, awareness/publicity,
interpersonal relationships and experimentation were very important factors in retaining
customers and that it is more profitable to retain existing customers than continually
recruit new ones. The study further revealed that there were customers who had multiple
accounts signifying customer loyalty.
The study further revealed that Customer’s feedback lead to favorable talk about the
respondent’s business. The study also revealed that current customers were used as
references. The study also revealed that relationship marketing is successful in spreading
positive word of mouth about the business. The study further revealed that as a
customer’s trust increases with employees in a firm, positive word of mouth
communication about the organization is more likely to increase.
Finally the study revealed that customer retention had an impact on revenue and
profitability of the hair stylists’ businesses. The study further revealed that speed, safety,
reliability, flexibility, affordability, accessibility and customer care were factors that
increased a hair stylist’s profitability. The study also revealed that firms benefit more
from maintaining long term relationships than a short term relationships and that
customer’s relationship with the Company lengthens profits rise. This implies therefore
that long term relationships are profitable. Additionally the study revealed that
relationship encourages repeated and increasingly frequent buying activity thereby
increasing profitability.
5.3 Discussion
5.3.1 Interpersonal Relationship on Customer Satisfaction
According to the data analyzed in this study, interpersonal relationships lead to customer
satisfaction. Heiller, Geursen, Carr and Rickard, (2013) argue that Customer satisfaction
can be described as the degree of overall pleasure or contentment felt by the customer,
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resulting from the ability of the service to fulfil the customer’s desires, expectations and
needs in relation to the service. Abdul-Muhmin, (2005) also adds that customer
Satisfaction can be described as the ultimate philosophical foundation of modern
marketing insofar as the marketing concept views the key to corporate success as being in
effectively identifying and satisfying customer needs better than the competition. Both in
practice and academic circles, the received wisdom is that customer satisfaction is
desirable business philosophy because satisfaction leads to important customer cognitions
and behaviors like loyalty, commitment and positive word of mouth. The finding is
however contrary to the views of Kotler (2007) that satisfaction with a service provider is
seen as an antecedent of relative attitude because without satisfaction consumers will not
hold a favorable attitude towards the service provider compared to other alternatives
available.
The factors in interpersonal relationships that lead to customer Satisfaction and which the
respondents strongly agreed include addressing customers by their names, knowing about
their families, knowing about the clients work or what they do for a living, keeping
client’s promises, caring and individualized attention to the customers,
responsiveness/willingness to help and staff reliability. According to Sureshandar,
Rajendran and Anantharaman (2012), customer satisfaction comprises of the following
five factors; core service or service product, human element of service delivery,
systematization of service delivery; non-human element, tangibles of services scales and
social responsibility. The finding further conforms to Sheth & Parvatiyar, (2005) who
posits that the utility of relationship marketing lies in the creation of unique and difficult-
to-imitate knowledge, but knowledge of customers can only be increased if firms are
capable of maintaining continuous relationships with their customers.
Further the study revealed that satisfaction results in repeat purchase. The finding
contrasts to the views of Kotler (2007) that repetitious purchasing behavior may be as a
result of a market structures in which buyers find themselves with few alternatives or
where available alternatives can only be obtained at a high cost in terms of breaking
current ties with suppliers. He goes further to argue that repetitious behavior does not
imply that customers are satisfied.
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The study also revealed that satisfied employees actually lead to satisfied customers.
Hansemark and Albisson (2014) posits that regardless as to what business leaders may be
trying to implement in their companies, any employee interacting with customers is in a
position either to increase customer satisfaction or put it at risk. Employers in such
positions should therefore have the skills to respond effectively and efficiently to
customer needs. Guenzi and Pelloni (2014) argues that customer’s interpersonal
relationships with front-line employees are a very important component of the overall
offering of the service provider, not only because they positively affect customer
satisfaction and loyalty towards the firm, but also because they can be a powerful tool for
reducing the risk of customers’ switching behaviors when other customers leave the
service provider.
5.3.2 Interpersonal Relationship and Customer Loyalty
The study revealed that customer satisfaction lead to customer retention and loyalty. This
agrees with Lytle and Timmerman (2006) who argue that this customer loyalty leads to
better business results, to the extent that a base of loyal customers causes a decrease in the
marketing costs, provides an excellent communication route for lifting the company
image, makes it difficult for the competition to have access and allows setting higher
prices. Roger & Rolf (2012) also agree with this finding when they posit that Customer
loyalty provides the foundation of a company’s sustained competitive edge, and that
developing and increasing customer loyalty is a crucial factor in companies’ growth and
performance.
The study also revealed that quality relationships between customers and front line
employees can contribute greatly to the customer’s overall perception of quality of the
service provider. This conforms to Guenzi and Pelloni, (2014) who posits that for service
companies the quality of the relationships between customers and front line employees,
which incorporates both a professional and social dimension, can strongly contribute to
the customer’s overall perception of quality of the service provider. They go further to
argue that the managerial implications of this include; in personnel selection, great
emphasis should be placed on empathetic skills and interpersonal attitudes of prospective
front-line employees, training should be focused on increasing relational skills of contact
employees, reward systems should be based, at least to some extent, on employees’
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contribution in fostering customer satisfaction and loyalty and finally, the service
provider should place high attention to the design of facilities layout, the blueprinting of
the fruition processes, the organization of peripheral services such as social events in
order to maximize the interpersonal interaction opportunities between front-line
employees and customers
The study further revealed that the stylists tracked customer visits using manual tracking
system. This implies therefore that they would be able to tell whether customers were
loyal to the business. The study revealed that the hair stylists had a loyalty program in
place. This agrees with the findings of Guenzi and Pelloni (2014) that customer’s
interpersonal relationships with front-line employees are a very important component of
the overall offering of the service provider, not only because they positively affect
customer satisfaction and loyalty towards the firm, but also because they can be a
powerful tool for reducing the risk of customers’ switching behaviors when other
customers leave the service provider. The study also revealed that recognition, service
failure, awareness/publicity, interpersonal relationships and experimentation were very
important factors in retaining customers and that it is more profitable to retain existing
customers than continually recruit new ones.
The study further revealed that there were customers who had multiple accounts
signifying customer loyalty. The study findings conforms to Kotler (2007) who argues
that customer loyalty has been considered as an important source of long-term business
success and building a relationship with a customer is a good way to retain loyal
customers in the long-term. Loyal customers continue to purchase the service, generate
long term revenue streams, tend to buy more, and may be willing to pay premium prices,
all of which increase revenue and profitability. Repetitious behavior does not imply that
customers are satisfied.
5.3.3 Interpersonal Relationship and Free Publicity
The study further revealed that Customer’s feedback lead to favorable talk about the
respondent’s business. The study also revealed that current customers were used as
references. The study also revealed that relationship marketing is successful in spreading
positive word of mouth about the business. This agrees with Ndubisi (2007) that loyal
67
customers are valuable communicators of favorable word-of-mouth about organisations
or products to which they feel loyal. He goes on to argue that as evangelists, they can
attract new customers for the organization and may even increase their own consumption
collectively to the benefit of its sales, revenue and profit. Loyalists can also serve as
useful sources of new product ideas. This is affirmed by Rosen (2005) who argues that
people tell others about a product or a service because it somehow relates to their lives,
invisible networks have always been important in the diffusion of certain services or
products, in order to compete companies must understand that they are not selling to
individual customers but to networks of customers.
The study further revealed that as a customer’s trust increases with employees in a firm,
positive word of mouth communication about the organization is more likely to increase.
Hansemark and Albinsson (2014) argues that the more satisfied the customer is with
his/her interpersonal relationship to the service employee, the more likely she/he is to
share personal information. The findings also conforms to views of van der Sande (2006)
that in the company called Harley-Davidson, Dealer employees are overtly encouraged by
management and corporate leaders to get to know these customers personally,
demonstrate attention and care, and become their friends basically develop working
interpersonal relationships and that the bonding between employees and customers has
been so successful in spreading positive WOM communication that Harley has no need
for substantial expenditures on advertising and promotions.
According to Carnage (2005), satisfied internal customers increasingly satisfy external
customers. This is affirmed by Ulrich (2010) who posits that a key dimension of the
employee-customer relationship is interpersonal trust, or confidence in an employee's
reliability and integrity. This implies that as a customer's trust increases in a specific
employee (or employees), positive word of mouth communication about the organization
is more likely to increase. In our proposed model, we argue that such trust is a
consequence of three other interpersonal relationship dimensions: familiarity between
employees and customers, a personal connection between employees and customers.
This findings concurs with the views of Westbrook (2007) that WOM is mediated by
satisfaction levels. He notes that positive WOM is associated with performance above
that which was predicted and negative WOM with performance below that which was
wanted. Hartline and Jones (2006) concluded that intention to utter WOM is correlated
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with the customer’s perceptions of value and quality. The higher those perceptions the
stronger the intention of uttering positive WOM. The stronger of the two correlates is
value. Given that certain components of the service delivery process signal ‘value’ to
customers, it makes sense for management to isolate these dimensions and develop them
to promote referrals.
5.3.4 Interpersonal Relationship and Firm Profitability
Finally the study revealed that customer retention had an impact on revenue and
profitability of the hair stylists’ businesses. Burnham, Ye and Singh (2008) postulates that
the relevance of the business strategy centred on retaining customers by making them
brand-loyal is due to the existing conviction that it is more profitable to maintain
customers, thereby seeking profitability on the long-term horizon, than attracting new
customers, given that there is a significant difference in terms of the budget. The study
further revealed that speed, safety, reliability, flexibility, affordability, accessibility and
customer care were factors that increased a hair stylist’s profitability.
The study also revealed that firms benefit more from maintaining long term relationships
than a short term relationships and that customer’s relationship with the Company
lengthens profits rise. This implies therefore that long term relationships are profitable.
This conforms to Wong and Sohal, (2006) who posits that customer retention has been
shown to have a direct impact on revenue and profitability. This also agrees with a
research done by US strategy consulting firm Bain & Company which showed that a 5
per cent increase in customer retention leads to a considerable rise in net present value
profits: this increase can be as much as 125 per cent for a credit card company and 50 per
cent for an insurance broker.
Bain and Company’s calculation of profitability is based on the expected cash flow over a
customer’s lifetime, the longer they stay, the more profits they bring the company. What
is more, customers typically generate increasingly more profit each year they stay with
the company. Retaining customers allows the company to develop a deeper relationship
with them and encourages repeated and increasingly frequent buying activity.
Additionally the study revealed that relationship encourages repeated and increasingly
frequent buying activity thereby increasing profitability. This finding concurs with Kotler
(2007) who Repetitious purchasing behavior may be as a result of a market structures in
69
which buyers find themselves with few alternatives or where available alternatives can
only be obtained at a high cost in terms of breaking current ties with suppliers. Kotler
goes ahead to argue that loyal customers continue to purchase the service, generate long
term revenue streams, tend to buy more, and may be willing to pay premium prices, all of
which increase revenue and profitability. This is affirmed by the views of Reichheld and
Sasser (2006) that retaining customers allows the company to develop a deeper
relationship with them and encourages repeated and increasingly frequent buying activity.
On the contrary they argue that customer defections have a surprisingly powerful impact
on the bottom line. As a customer’s relationship with the company lengthens, profits rise.
The study also revealed that customers are prepared to pay a premium price. This
conforms to the findings of Dwyer, (2007) that there are several reasons why retaining
customers is so profitable: Sales and marketing and set-up costs are amortized over a
longer customer lifetime; Customer expenditure increases over time; Repeat customers
often cost less to service; satisfied customers provide referrals; satisfied customers may
be prepared to pay a price premium.
The study further revealed that customer relationship is a source of competitive
advantage. This conforms to the views of Anderson, Lodish and Weitz (2007) who find
that interpersonal relationship means a psychological and social relationship that
manifests itself as care, trust, intimacy and communication. These relationship exchanges
can create value and therefore, help firms to achieve sustainable competitive advantages.
It also agrees with the views of Fornell, (2012) that the building of a strong customer
relationships has been suggested as a means for gaining competitive advantage.
According to Reinartz and Kumar (2008) in years when people are said to be the only true
competitive advantage, it is evident that interpersonal relations in organizations and
processes of nourishing them have become essential for the organizational success.
Finally the findings compliments the views of Lahtinen & Isoviita (2008) that the
competitive advantage received from customer satisfaction is hard to duplicate for other
companies, especially if the company devotes more effort into their customer service than
their competition.
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5.4 Conclusion
5.4.1 Interpersonal Relationship on Customer Satisfaction
The findings of this study lead to a conclusion that interpersonal relationships lead to
customer satisfaction. It also lead to a conclusion that the factors in interpersonal
relationships that lead to customer satisfaction and which the respondents strongly agreed
include addressing customers by their names, knowing about their families, knowing
about the clients work or what they do for a living, keeping client’s promises, caring and
individualized attention to the customers, responsiveness/willingness to help and staff
reliability. Further the study concluded that satisfaction results in repeat purchase. The
study also concluded that satisfied employees actually lead to satisfied customers.
5.4.2 Interpersonal Relationship and Customer Loyalty
The findings also lead to a conclusion that customer satisfaction lead to customer
retention and loyalty. The study also concluded that quality relationships between
customers and front line employees can contribute greatly to the customer’s overall
perception of quality of the service provider. The study further concluded that the stylists
tracked customer visits using manual tracking system which implies therefore that they
would be able to tell whether customers were loyal to the business. The study concluded
that the hair stylists had a loyalty program in place. The study also concluded that
recognition, service failure, awareness/publicity, interpersonal relationships and
experimentation were very important factors in retaining customers and that it is more
profitable to retain existing customers than continually recruit new ones. The study
further concluded that there were customers who had multiple accounts signifying
customer loyalty.
5.4.3 Interpersonal Relationship and Free Publicity
The study concludes that Customer’s feedback lead to favorable talk about the
respondent’s business. The study also concludes that current customers were used as
references. The study also concludes that relationship marketing is successful in
spreading positive word of mouth about the business. The study further concluded that as
a customer’s trust increases with employees in a firm, positive word of mouth
communication about the organization is more likely to increase.
71
5.4.4 Interpersonal Relationship and Firm Profitability
Finally the study concludes that customer retention had an impact on revenue and
profitability of the hair stylists’ businesses. The study further concludes that speed, safety,
reliability, flexibility, affordability, accessibility and customer care were factors that
increased a hair stylist’s profitability. The study also concluded that firms benefit more
from maintaining long term relationships than a short term relationships and that
customer’s relationship with the Company lengthens profits rise. Additionally the study
concluded that relationship encourages repeated and increasingly frequent buying activity
thereby increasing profitability.
5.5 Recommendations
5.5.1 Recommendations for Improvement
5.5.1.1 Interpersonal Relationship on Customer Satisfaction
While acknowledging the importance of interpersonal relationships in enhancing
customer satisfaction based on the revelation of this study, the study recommends that
organizations in the beauty industry especially the salons improve their interpersonal
skills to enable them satisfy their customers. The study further recommends that these
organizations consider the various factors in interpersonal relationships that lead to
customer satisfaction such as addressing customers by their names, knowing about their
families, knowing about the clients work or what they do for a living, keeping client’s
promises, caring and individualized attention to the customers, responsiveness or
willingness to help and staff reliability when planning on which services to offer.
5.5.1.2 Interpersonal Relationship and Customer Loyalty
The study further recommends that organizations should invest in computerized tracking
system for tracking customer visits. This way they will be able to tell whether customers
were loyal to the business. The organizations should also put in place a loyalty program
where they will be able to reward loyal customers. This will in turn assist in retaining the
customers. The study also recommends that the organizations take cognizance of
recognition, service failure, awareness and publicity, interpersonal relationships and
72
experimentation as important factors in retaining customers. This will improve on the
profitability of the organizations as it is more profitable to retain existing customers than
continually recruit new ones.
5.5.1.3 Interpersonal Relationship and Free Publicity
The study further recommends that the stylists improve on their employee satisfaction as
this will in turn enable them serve the customers’ better thereby instilling a culture of
trust. As a customer’s trust increases with employees in a firm, positive word of mouth
communication about the organization is more likely to increase. The stylists should also
improve on their relationship marketing as this is successful in spreading positive word of
mouth about the business.
5.5.1.4 Interpersonal Relationship and Firm Profitability
The study also recommends that the stylists consider factors such as speed, safety,
reliability, flexibility, affordability, accessibility and customer care which are important
factors that increases a hair stylist’s profitability. The stylists should work towards
maintaining long term relationships with their customers as such customer’s relationship
with the Company lengthens profits rise. Additionally such relationships encourages
repeated and increasingly frequent buying activity thereby increasing profitability.
5.5.2 Recommendations for Further Studies
The study suggests that further research should be done to determine the impact of
interpersonal relationships between service providers and client towards customer
satisfaction. A similar research may still be tested using a different methodology. In
carrying out the further research the study suggests that the study area be widened to
cover other hair stylists in other areas across the country for comparison purposes and to
allow for generalization of findings.
73
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APPENDICES
Appendix I: Introduction Letter to the Respondent
Dear Respondent
I am a student at the United States International University- Africa taking a Marketing
Research course. I am conducting research on ‘The Impact of Interpersonal Relationship
on the service providers- The Case of Hair Stylists in Nairobi. Your hair stylist business
was identified as one of the major firms to be included in the study. You are therefore
kindly requested to provide the required information in the questionnaire. The instructions
on how to fill the questionnaire are provided below. Any information and opinions
obtained in connection to this study are important and will remain confidential to be used
only for this research. No individual responses will be reported.
Results from this study will be of importance to current and future companies in the hair
styling industry as well as anyone interested in this area in understanding the key issues
that we as researchers are interested in.
Should you require a summary of the results please do not hesitate to contact me on the
address below.
Once again thank you for your cooperation and time.
Yours Sincerely,
Abdirizak A Hussein
0722-396985
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Appendix II: Questionnaire
How to fill the Questionnaire
Fill in the responses in the spaces provided by checking the appropriate boxes. The
questions should be answered by the Owner/Manager of the business.
Where responses are not part of the options given, record responses on the spaces
provided as accurately as possible.
SECTION 1: DEMOGRAPHIC INFORMATION
1. Gender of respondent
Male ( ) Female ( )
2. Highest level of education
University ( )
College ( )
High school ( )
3. Location of Business ___________________________________________________
4. Designation/Title____________________________________________________
5. Number of years of service in industry __________________________________
6. Size (Number of Employees) _________________________________________
7. Which Gender are your Clientele? (You can tick both)
Male ( ) Female ( )
Please explain why? ________________________________________________
8 On average, how many Customers do you serve in a day? _______________________
9 Please indicate any professional training acquired.-
_______________________________________________________________________
______________________________________________________________________
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SECTION 11: INTERPERSONAL RELATIONSHIP LEADS TO CUSTOMER
SATISFACTION
1. Below are the factors in Interpersonal Relationship that would lead to Customer
Satisfaction. Kindly indicate the extent to which these factors lead to your clientele’s
Satisfaction.
Strongly Agree (5), Agree (4), Uncertain (3), Disagree (2) Strongly Disagree (1)
2. Satisfied Customers result in Customer Retention and loyalty
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
3. Relationship Marketing helps to gain privileged information about Customer’s needs
and in turn provide more satisfactory offers than competitors.
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
4. Satisfaction results in repeat purchase
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
5. Satisfaction results in Customers’ favorably talk about your business
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
6. Customer retention has an impact on revenue and profitability
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
Factors 5 4 3 2 1
Addressing Customers by
their names
( ) ( ) ( ) ( ) ( )
Knowing about their families ( ) ( ) ( ) ( ) ( )
Knowing about the Clients
Work or what they do for a
living
( )
( )
( )
( )
( )
Keeping Client’s Promises ( ) ( ) ( ) ( ) ( )
Caring and individualized
attention
( )
( )
( )
( )
( )
Responsiveness/Willingness
to help
( )
( )
( )
( )
( )
Staff reliability ( ) ( ) ( ) ( ) ( )
81
7. Satisfied internal customers (EMPLOYEES) increasingly satisfy external customers
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
8. Quality of relationships between customers and front line employees can contribute
greatly to the customer’s overall perception of quality of the service provider.
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
9. Do you have an employee incentive scheme in place for excellent work done?
Yes ( ) No ( )
SECTION 111: INTERPERSONAL RELATIONSHIPS AND CUSTOMER
LOYALTY
1. Does your business track customer visits?
Yes ( ) No ( )
2. If yes for Question 1 above, what sort of a tracking system is in place?
a) Manual tracking system ( )
b) Computerized tracking system ( )
c) Other (Specify) ______________________________________
3. Does the organization have a customer loyalty program in place?
Yes ( ) No ( )
4 Does the organization have a customer complaint system in place that all staff and
customers are aware of?
Yes ( ) No ( )
5 If yes to Question 4 above, what type of complaint System, is in place?
a) Suggestion box
b) Inform the Manager
c) Others (Specify) ___________________________________________
6 It is more profitable to retain existing customers than continually recruiting new ones.
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
7 The value derived by customers may be a predictor of switching behavior.
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
8. Below are reasons why individual would switch Salons.
Kindly rate their importance of these factors to your firm in relation to retaining
Customers where; (5) Is very important, (4) Important, (3)Neutral,
(2) Some how important, (1) Not important.
82
SECTION 1V: INTERPERSONAL RELATIONSHIP AND FREE PUBLICITY
1. Do you use your current customers as a reference by your organization?
Yes ( ) No ( )
2. Is there a reward scheme in place for clients after introducing new clients into the
business?
Yes ( ) No ( )
3. Does the business have clients with multiple accounts? For example from the
same households, friends and that come for multiple services)
Yes ( ) No ( )
a). If Yes answer to question 6, do they enjoy a preferential rate?
Yes ( ) No ( )
4. Relationship Marketing is successful in spreading positive word of mouth?
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
5. As a Customer’s trust increases with employees in a firm. Positive word of mouth
communication about the organization is more likely to increase
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
Factors 5 4 3 2 1
Recognition ( ) ( ) ( ) ( ) ( )
Service Failure ( ) ( ) ( ) ( ) ( )
Strong interpersonal
relationships with employees
( ) ( ) ( ) ( ) ( )
Response to Service Failure ( ) ( ) ( ) ( ) ( )
Awareness/Publicity of
Competitors
( ) ( ) ( ) ( ) ( )
Experimentation/Trying other
Hair stylists
( ) ( ) ( ) ( ) ( )
83
SECTION V: INTERPERSONAL RELATIONSHIP AND PROFITABILITY
1. Below are factors that are expected to increase a hair stylists profitability where
Very Good (5), Good (4), Fair (3), Poor (2) Very poor (1)
2. Firms benefit more from maintaining long term customer relationship than short term
relationships
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
3. Customer defections have an impact on the bottom line
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
4. Customer’s relationship with the Company lengthen profits rise
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
5. Building customer relationship is a source of competitive advantage
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
6. Long term relationships are profitable
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
7. Customers who are converted and retained in committed relationships are relatively
low maintenance
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
8. Relationship encourages repeated and increasingly frequent buying activity
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
9. Satisfied customer may be prepared to pay a premium price.
Strongly Agree ( ), Agree ( ), Uncertain ( ), Disagree ( ) Strongly Disagree ( )
Variable 5 4 3 2 1
Speed
Safety
Reliability
Flexibility
Affordability
Accessibility
Customer Care
