CHAPTER 1

PROBLEM AND ITS BACKGROUND

Background of the Study
The Health and Wellness Services industry belongs to the services sector. The National Statistical
Coordination Board (2007) defines it as institutions that cater to the activities of persons
traveling to and staying in places outside their usual environment for not more than one
consecutive year for health and wellness purposes not related to the exercise of an activity
remunerated from within the place visited. Establishments belonging to the industry, therefore,
are in engaged in: 1) hospital care and treatment refer to services offered by public and private
hospitals, sanitaria and other similar services; 2) specialty clinics pertain to general public and
private medical services such as dental and laboratory services, and other human health services;
3) wellness and spa centers consisting of enterprises that provide physical and well-being
services including but are not limited to slendering and body-building services, massage,
reflexology, facials, nail care, waxing, and body treatments, etc.; and 4) retirement and
rehabilitative care comprised of residential institutions, that care for the aged and orphans, and
the rehabilitation of people addicted to drugs or alcohol.
A number of researchers (e.g. Kelly and Turley, 2001; A-l alak, 2010; Rust and Oliver, 1994;
Mull et al; 2005) suggested that revealing customer perceptions of service experiences has
always been important to the success of service organizations. From a management standpoint,
managers should systematically examine current services from their customers perspectives and
redesign their service products and environment in which their services are delivered to their
target customers. The provision of quality experiences is extremely important for customer

satisfaction and retention (Zeithaml et al; 2006). Offering premium quality, personally tailormade, and exclusive massage and fitness services is a key contributor to customer satisfaction of
spa and wellness programmes.
It is vitally essential for wellness center managers to comprehend and measure the impact of
service quality on the satisfaction of their customers. The feedback obtained from such practice
can be used to make strategic improvements in the service production as well as the service
delivery that will impact business and ultimately increase profitability. Therefore the major
purpose of this study is to describe the factors of satisfaction among wellness center customers
and which among the products or services marketing strategies are contributory to customers
satisfaction in the selected municipality of Nueva Vizcaya. Major research questions include: (1)
What is the respondents profile? (2) What is the level of satisfaction of wellness center
customers? (3) Which among the products marketing strategies would likely to meet customers
satisfaction? And (4) Which among the services marketing strategies warrants customers
satisfaction?

Statement of the Problem

The study aims to identify and describe the factors of satisfaction among wellness center
customers and which among the products or services marketing strategies are contributory to
customers satisfaction. Specifically, it also aimed to answer the following questions:
1. What is the respondents profile in terms of the following:
1.1 Sex
1.2 Age
1.3 Occupation
1.4 Civil Status
1.5 Frequency of Visit
1.6 Municipality
2. What is the level of satisfaction of wellness center customers
3. Which among the products marketing strategies would likely to meet customers
satisfaction in terms of:
4. Which among the services marketing strategies warrants customers satisfaction in terms
of:
Significance of the Study
This study aimed to benefit the following:
Wellness Centers The result of this study will be
Customers This study will also benefit consumers
The researchers Researchers of this study will also be benefited as they can increase
their confidence in performing studies that are related on their field.

Future researchers This study can also be used by future researchers should they have
similar study with this study.
Scope and Delimitation
This study determined the satisfaction of wellness center customers and which among the
products and services marketing strategies are contributory to customers satisfaction. It also
aimed to determine the
The study had 25 respondents and is composed of customers and employees of the
different wellness centers .
This study was conducted at Selected Municipalities of Nueva Vizcaya during the First
Semester of the School Year 2015-2016. The customers and employees of the different wellness
centers were taken as the respondents of the study.

Definition of Terms

CHAPTER II
REVIEW OF RELATED LITERATURE
The review of literature of this study will give an overview of literatures on service
quality and customer satisfactions that are related to the research problem presented in the
previous chapter. It also presents various studies made regarding the issues related with service
quality and customer satisfaction.

Conceptual Literature
Customers Perception of Service
Services is represented by two (2) components, service providers and customers. It is
then important that the quality of service that organization provides should have a significant
effects on customers to attain the satisfaction and value of their customers. These two
components clearly defines and differentiate different companies on how they provide their
services and if they really are competing with the other companies in the business industry.

Service Quality
Service quality is an important component in attaining customer satisfaction, but
excellent service quality is more important in order to completely and directly create a customer
loyalty. It is then defined that service quality is the delivery of products and services to
customers in an excellent and superior way that it can meet their expectations. Service quality is
evaluated through customers feedback and evaluation on how services are being performed.
Service quality perception is based on what customers expect on the service before it will be
provided to them until it is received. Service quality is used by customers to evaluate service
organizations, processes and to differentiate different competing service companies. It is then
very important to know customers expectation because it will be the basis to know who
companies have a high expectation level and whose not. Therefore it is important that service
providers should develop ways om how to improve the service offerings.

Components of Service Quality

There are significant components identified by Gronroos. These are technical quality,
functional quality and corporate image.
Technical Quality
Technical quality is what is delivered to customers. It refers on how aspects of services
are measured. It is an important tool on measuring the quality of service because customers and
service providers know if the services are performed well on the said time as promised.
Functional Quality
Functional quality is how a service is performed. It shows how customers feel and
evaluate a service performance. Customers perception on how services are delivered also
includes how employees behave, their physical appearance and the atmosphere of the service
environment.
Corporate Images
Corporate images are the combination of technical quality and functional quality of
services. Corporate images focuses on how services are performed, the atmosphere being
provided by service providers and the physical appearance of the service providers. The main
goal of service organizations is to create an image to customers for them remember always.
Dimensions of Quality

Recent researchers indicate that there are five (5) quality dimensions that service
organizations should consider. These can be used on how customers evaluate the value of the
services they received, namely:

Reliability
Responsiveness
Assurance
Empathy
Tangibles

Reliability
Reliability focuses on the ability of the service providers perform their promised services
accurately. Those organizations that honor their promises on providing services are the most
preferred organizations for customers to deal business with. As stated by Zeithaml and Bitner,
organizations should focus on the expectation of customers on reliability because it is the most
important component on the perception of service quality.

Responsiveness
Responsiveness focuses on the willingness of service organization to provide assistance
and help with their customers. Responsiveness requires organizations to be able to handle
complain from their customers. Responsiveness refers on the time that customers spend on
waiting for them to be assisted and how the organization attended their problems and complains.
For organizations to excel in this dimension, they should consider the point of view of the
customers on how services should be delivered to them and not of the organization.

Assurance
Assurance refers to the employees knowledge, courtesy and their ability to maintain trust
and confidence. The service employees performing actual services are responsible in creating
trust and loyalty with the customers. Having an employee with a positive attitude towards quality
is very important to service organizations. Their positive attitude affects the customers
perception of service.

Empathy
Empathy refers to the care and attention given to each individual customer. Empathy
focuses on giving the customers an exclusive service that makes them feel unique and special.
Small organizations has more advantage than large companies because they have the ease in
collecting information about their customers. The dimension helps organizations to provide their
individual customers personalized services.

Tangibles
Tangibles refers to the appearance of the materials used by the organization. It includes
physical facilities, employees and written materials. For some customers, they used this
dimension in evaluating the organization. Tangibles are used to enhance the image of the
organization. In some organization, they combine another dimension with this dimension in

order to create a good strategy. It can be said that those organizations who do not include
tangible dimension in their strategy tends to fail in creating a good strategy.

Customer Satisfaction
Customer satisfaction measures how well the expectations of a customer concerning a
product or service provided have been met. Over the last decade all sizes and types of
organizations have understood the importance of customer satisfaction. It is generally observed
that to keep a customer is less costly than to win a new one. "Customer satisfaction is a measure
of how an organization's total product performs in relation to a set of customer expectations".
(Hill & Alexander, 2000) As per (Armstrong & Kotler, 2009) customer satisfaction is, "The
extent to which a product's perceived performance matches a buyer's expectations" If the
performance match the customers expectation, they are satisfied and if, performance exceeds the
customer's expectation then customers are highly satisfied or delighted.
Related Studies
According to West on his study entitled 10 Factors That Affect Customer Satisfaction, for
companies to meet their customers satisfaction, they should be able to keep updated on latest
technological advances. Technology has a big role on improving business, it can help small and
mid-size companies be like big companies by improving their purchase quality. If products and
services are delayed, most customers started to complain about products and services they avail.
Especially on restaurants, if orders are delayed, customers may think that the restaurant do not
have enough staff. If the products then are delayed, customers may think that their orders are
mishandled. Excuses are not considered when offering a service to customers. For example, a

repair guy promises to his customer that he will be there around 9, if he does not show up,
customers tend to be disappointed. And so in order to for companies to keep the loyalty of their
customers, they should be able to set their waiting time at minimum.

In the study of Sabir et al; entitled Factors Affecting Customers Satisfaction in Restaurant
Industry in Pakistan, it was mentioned that in the business industry, customer satisfaction plays
an important role because if the company satisfies their customers it will help the company be
more profitable. Customer satisfaction is defined how customers think about the product and
how it differs with other products. The evaluation of customer satisfaction is based on how
customers meet their needs and wants, if they are satisfied or dissatisfied (Deng et al; 2009).
Based on research, customer satisfaction is one successful key element on keeping the product
for a long period of time. Satisfying customers needs and wants may take long and be costly but
if companies have provide them, it can help them keep the loyalty of their target customers and
build a long term relationship with them (Eshghi et al; 2007).

In the study of Badsheer et al; entitled The Relationships between Service Quality, Satisfaction
and Behavioral Intentions of Malaysian Spa Center Customers it was stated that for service
organizations to attain success, number of researchers reveals that companies should be able to
know customers perceptions on their service experiences. They should be able to know the
current perspectives of their customers for them to be able to redesign their services and
environment from which will be delivered to their target customers (Kelly and Turley 2001, AlAlal 2010, Rust and Oliver 1994, Mull et al; 2005). One important key on customer satisfaction

is how customers enjoy the service quality of the business. For example, on spa industry offering
a exclusive massage and fitness service can be a good factor on satisfying customers (Zeithaml et
al; 2006). Due to increased number of discussions on customer satisfaction, it has been cleared
that service marketing and management is very important in the business field. Even though
there are lot of research on service quality, satisfaction and repurchase intention, in the field of
spa industry, they still lack of research on the impact of service quality perceptions on
satisfaction and intention (Howat et al; 1999, Kelly and Turley 2001, Ko and Pastore 2005,
Petrick 2004). Satisfaction as defined by Oliver (1997), it is the customers fulfillment response
on the product or service they have avail. Olivers definition of satisfaction is revised by
Zeithaml and Bitner (2003), they stated that satisfaction is the evaluation of customers whether
the product or service meet their expected needs and wants. Satisfied customers are based on
customers who enjoy positively the products of a certain company (Kim and Lough 2007,
Tsitkari et al; 2006). Therefore, it is shown that customer satisfaction and service quality
perceptions affects the purchase behavior of the customer (Cronin and Taylor 1992, Cronin et al;
2000, Patterson and Spreng 1997, Rust and Oliver 1994, Tian-Cole et al;2002). Based on the
study of Cronin and Taylor (1992), they found that customer satisfaction have a greater impact
on the purchase intention than service quality. It is then acknowledge that service quality is the
reason of customer satisfaction (Anderson et al; 1994, Cronin et al; 1992, Zeithaml et al. 2006).
Satisfaction has been the basis of purchase intentions (Bitner 1990, Cho et al; 2004, Cronin et al;
2000, Patterson and Spreng 1997, Tian-Cole et al; 2002, Yoo et al; 2003). It has been observe
that customers who are satisfied complain less and do repeat purchase. For customers who are
not satisfied tends to be disloyal to the product or service (Cho et al; 2004, Cronin et al; 2000,
Kelly and Turley 2001, Tian-Cole et al; 2002). There are five dimensions of service quality

namely, tangibles, reliability, responsiveness, assurance and empathy, it is used to measure the
quality of service (Cronin and Taylor 1994, Parasuraman et al; 1985, Chang and Lee 2004, AlAlak 2010). Satisfaction on spa industry can be improved by bringing a enchanced high-class
services in each individual customer that made him or her feel that it is exclusive made just for
his or her needs.

Chapter III
Methodology
Research Design
This research utilized the descriptive-inferential research design.

It

was descriptive-inferential because it tends to present the profile of the

respondents and as well as the customer satisfaction and service quality
problems in terms of Reliability, Assurance, Tangibility, Empathy and
Responsiveness. Specifically, the study used the survey method through the
aid of survey questionnaire. The questionnaire is the primary data
gathering tool.
Research Environment
The study will be conducted on the Wellness Center establishment in
selected municipalities of Nueva Vizcaya. Those establishments are primarily

engaged in serving body spa, foot spaetc and rendering quality service in a
quality area which provides a relaxing and comfortable atmosphere.
Respondents of the Study
The respondents of the study were the costumers and employees of
Wellness Centers in selected municipalities of Nueva Vizcaya.
Data Gathering Instrument
To gather the necessary data needed for the study, the researchers
used a questionnaire following the likert scale. The service quality
statements used in the survey were rated using a Likert scale, indicating 4Excellent, 3-Satisfactory, 2-Poor, and 1-Very Poor. You may use the 4 point
scale it would be easier. The questionnaire is a set of questions obtaining
statistically useful or personal information from an individual.
Data Gathering Procedure
The survey questionnaire will be presented to the research adviser for
approval

and

validation.

The

researchers

personally

administer

the

distribution of the survey- questionnaires which immediately retrieved after

respondents have answered them.
Data Analysis
The researchers used the following steps:
1

The researchers seek permission from the owner/ manager Wellness Centers to float
questionnaires to the respondents.

The researchers provided questionnaire to their respective respondents. The researchers

discussed the instructions and items of the questionnaire to ensure that the respondents
will understand the items.

The questionnaires were retrieved as soon as they were answered by the respondents.

The responses were tabulated, analyzed and interpreted.

Scoring of the Questionnaire

The survey questionnaire checklist asked the respondents to check the
needed information corresponding to their personal profile. The scored be
the following: Likert Scale

SCALE

MEAN RANGE

DESCRIPTION OF COMPETENCE

1
2
3
4
5

1-1.49
1.50-2.49
2.50- 3.49
3.50- 4.0
4.50-5.0

Very Poor
Poor
Satisfactory
Very Satisfactory
Excellent