This document presents a study that explores a new service quality model to enhance customer retention in the Hong Kong fast food restaurant industry. The study uses qualitative interviews with 30 taxi drivers who frequently eat at fast food restaurants. Ten key themes emerged from the data on improving customer satisfaction and retention. These themes include the positive attitudes and effort of employees, building relationships with customers, combining personalized service and process, and applying a service model based on employees' sharing of knowledge, information, and skills with customers. The results suggest that a service model incorporating these elements could help fast food restaurants in Hong Kong enhance customer retention.

1. A New ServiceA New Service--Quality Model to Enhance Customer RetentionQuality Model to Enhance Customer Retention
in the Hong Kong Fastin the Hong Kong Fast--Food Restaurant IndustryFood Restaurant Industry
Kenneth Lui-ming Ngie, Philip J. Rosenberger III & Allen George
Newcastle Business School, University of Newcastle, Australia
Contact: philip.rosenbergeriii@newcastle.edu.au
IntroductionIntroduction
Research Question:Research Question:
1.What is the role of a service employee in
the course of service encounters in the
Hong Kong fast-food restaurant industry?
2.What is the relative contribution of each
element of service, knowledge,
information, knowledge (SKIP) to
customer retention in the Hong Kong fast-
food restaurant industry?
Background:Background:
• Considering new customer acquisition is
very costly, Hong Kong fast-food
restaurants (FFRs) must develop a new
service-quality model in order to enhance
customer retention (Law et al, 2004).
Study Objective:Study Objective:
• To explore the potential effectiveness of a
new service-quality model for FFRs by
focusing on personalised service that
could enhance customer satisfaction-
retention linkage (Buttle et al, 2002;
Patterson, 2004).
MethodologyMethodology
Research Design:Research Design:
• A phenomenological approach by means
of qualitative, semi-structured interviews
was used (Schembri & Sandberg, 2002);
• A purposeful sample of 30 taxi drivers
was selected due to their frequency of
eating at FFRs (three times per week);
• Their FFR experiences should assist in
understanding phenomenological nature
of the study (Limberg, 2000).
TwoTwo--Tier Interview Design:Tier Interview Design:
• The interview began with a critical-
incident-classification scheme;
• This helped participants describe a
complete eating-out experience (Bitner
et al, 1994; van Leeuwen, 2006);
• Open-ended questions encouraged
participants’ relational-strategy
suggestions of for enhancing customer
retention (Sandberg, 2000).
ResultsResults
Ten Key Themes:Ten Key Themes:
ConclusionConclusion
Key Contributions:Key Contributions:
1. More components of good, personalised
service and negative attitudes that may
enhance customer dis/satisfaction
(Surprenant & Solomon, 1987; Mittal &
Lassar, 1996; Albrecht, 1998);
2. Personalised service helps FFRs lock in
the individualistic-culture Hongkongers
(Chow, 2007; Hofstede, 2009);
3. Employees’ “building rapport with
customers” and “asking questions to
understand customer needs” (Gremler &
Gwinner, 2008, pp. 310, 318) are very
effective in creating customer retention;
4. Customers’ “willingness to pay more”
(Andersson & Mossberg, 2004, p. 171)
being a good indicator of their FFR
satisfaction;
5. Customer satisfaction-retention linkage
(Patterson, 2004) can be effectively
applied to Hong Kong FFR industry;
6. FFRs should look to customisation and
innovativeness by introducing
personalized service; and the use of
self-service technology and full-service
(Noone & Coulter, 2012; Ha & Jang,
2013);
7. The SKIP-based service-quality model
provides an alternative and pragmatic
way of examining service quality as
compared to other service-quality
models (Grönroos, 1984; Parasuraman
et al, 1985).
Ten key themes emerged from the
data on enhancing the customer
satisfaction-retention linkage (Ryan
and Bernard, 2003) :
1. Employee’s positive attitudes,
effort and performance.
2. Employees’ facilitation of customer-
to-customer interactions.
3. Employees’ competence and
sufficient training.
4. Employees’ building customer-
relationships with customers.
5. The identification of a wider scope
of personalized service.
6. A combination of process and
personalized service.
7. Employees’ information sharing
with customers.
8. A combination of employees’
knowledge and competency.
9. A combination of SKIP elements
can engender customer value, trust,
commitment and satisfaction.
10.The application of a SKIP-based
approach to Hong Kong FFRs.