In today's changing global environment, every organization is searching for innovative ways to achieve sustainable competitive advantage, increase customer loyalty and improve efficiency without sacrificing quality of service. Confronted with these ch...
In today's changing global environment, every organization is searching for innovative ways to achieve sustainable competitive advantage, increase customer loyalty and improve efficiency without sacrificing quality of service. Confronted with these challenges, service marketers are differentiating their service by cultivating long-term relationships with their customers. But in spite of a rapid growth of office market, academic researches about CRM(customer relationship marketing) of office building are rare.
The purpose of this study is to test whether financial performance of large scale office building is influenced by tenant perception of service quality and value, tenant satisfaction and tenant loyalty(tenant retention and user's recommendation), so that the study can be a reference for real estate managers to set up efficient after-sales service and tenant satisfaction.
To perform the empirical study, 385 questionnaires from persons who works at the office building in Seoul are gathered. And to find the relationships among variables, the survey data was analyzed by reliability analysis, frequency analysis and Structural Equation Model using SPSS 12.0 and AMOS 4.0 program.
This research has five hypothesis. Through the analysis of first seven hypothesis(H1-1 - H1-7), each service quality dimension had a significant effects on tenant satisfaction except for 'management service' dimension. Second and third hypothesis which tenant satisfaction has positively significant effects on both tenant retention and user's recommendation.
Fourth and fifth hypothesis which tenant satisfaction has positively significant direct effect on financial performance and indirect effect on financial performance by the parameter(tenant loyalty). In other words the study analysis shows that the positive impact of tenant satisfaction on financial performance of office building through partial mediation of tenant retention and user's recommendation is verified respectively. Tenant satisfaction has traditionally been regarded as a fundamental of tenant behavior. This study demonstrates actual tenant loyalty vary significantly depending on tenant's overall satisfaction and service quality. Tenant loyalty provide the most accurate assessment of tenant satisfaction. In a competitive business environment where it costs far more to acquire a new tenant than to retain one, the rewards of a successful tenant service strategy directly impact bottom line.
A more satisfied customer is statistically more likely to renew their lease and recommend; therefore, active management of customer service initiatives also translates to financial performance and an active management of the value of the asset. In the end enhancing tenant loyalty through satisfaction, higher tenant loyalty leads to improved profitability and helps to solidify market leadership and long-term success and also results in a lower capitalization rate for valuation.
According to this results, managers and owners of large scale office building must differentiate their property in the market to attract and retain tenants. Namely they should have more focus on especial service quality rather than fundamental service quality. Also they need to increase contemporary tenant satisfaction rather than one-year-before customer satisfaction to achieve a higher financial performance.