An investigation into how Irish companies operating in the tourism industry build relationships to enhance customer retention, with specific focus placed on Dublin based tour operators

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Settimi, Armando
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MA of Business Studies
Dublin Business School
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This study reviewed the literature in the area of customer service to identify its perceived benefits and to establish which factors are seen to be important in improving customer service in Dublin-based tour operators. Customer service has been shown to have a powerful impact on tour operator’s efficiency and effectiveness and the literature highlights at least five major areas of action that can be taken as a means of securing these benefits. These are: strategy; culture; the role of the manager; systems and communication. There is, however, another area which is receiving substantial additional attention recently, namely the nature of relationships between a tour operator and its customers. As the customer service literature focuses mainly on large American-based service companies and little research has been conducted in Ireland on customer care and its impact on organisational effectiveness, a primary objective of this research was to establish whether these findings from the wider literature are borne out in Ireland. A particular focus of the research was on the core relationship aspect. A final objective was to explore how Dublin based tour operators actually build customer relationships, how they select who they build these relationships, how they select who they build these relationships with, and which relationship-building strategies they found most successful. Following a review of the literature, a questionnaire which encompassed questions eliciting both qualitative and quantitative data was developed and sent by post to marketing and customer service managers of Dublin based tour operators. Data was collected from twenty-five tour operators in all. The survey confirmed that Dublin based tour operators do understand the benefits of a strong customer care policy, that customer retention has a strong profit impact compared to acquiring new customers and that building customer relationships is important to retaining customers in the long term. They carefully discriminate between those customers who have potential to be profitable and those who have not and are careful to channel their energies into the former group. However, when asked what methods they used to build relationships it was found that very few of the tour operators surveyed has structured plans in place. This would indicate that although they feel that building relationships with customers is crucial, there is a gap between their espoused beliefs and the amount of well structured- effort which they put into increasingly important area. There are some questions which remain outstanding following this study which may form the basis further investigations