The Role of Green Equity to Support Customer Equity in Hotel Industry

Green marketing is a current phenomenon, with many academics and environmental supporters relates it with financial benefits. In a highly competitive market, businesses must design new strategies that will create competitive advantages for winning customers. With increasing market awareness for envi...

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Bibliographic Details
Published in:Review of Integrative Business and Economics Research 2018-01, Vol.7, p.314-327
Main Authors: Kamala, Arum, Roostika, Ratna
Format: Article
Language:English
Subjects:
Baby boomers
Brand equity
Brand loyalty
Consumers
Customer services
Global economy
Green marketing
Hospitality industry
Hotels & motels
Initiatives
Intangible assets
Market strategy
Profitability
Reputations
Service industries
Tourism
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Summary:Green marketing is a current phenomenon, with many academics and environmental supporters relates it with financial benefits. In a highly competitive market, businesses must design new strategies that will create competitive advantages for winning customers. With increasing market awareness for environmental issues, government forces companies to practice environmentally friendly operations while market also appreciates companies with environment initiatives with better image. However, past research found unclear financial gains in green marketing practices. Hotel guests tend to see green marketing program as an integral part of overall hotels' strategy and do not see it independently as a main reason for their making decision to stay in the hotel. Green marketing program or "green equity" provides more contribution on hotel's image and reputation which is important hotel's intangible asset. This study examines the overall hotel's marketing programs called as customer equity and its impact on hotel guests' loyalty. Green equity is added with other strategic marketing programs which consist of value equity, brand equity and relationship equity. This study analyzes the structural model using Structural Equation Modeling with Partial Least Square. By analyzing 226 valid questionnaires distributed among hotel guests in five big cities in Indonesia (Jakarta, Yogyakarta, Bandung, Denpasar, and Surabaya), it is concluded that value, brand, relationship and green equity are sub dimensions of marketing programs. In addition, there are significant impacts of customer equity to hotel guests' loyalty. Regardless of financial gain, green equity remains important strategy for current hospitality and hotel industry. Green equity may influence customer loyalty through better image perceived by hotel's guests.
ISSN:2414-6722
2304-1013