The Impact of The New Trends and Innovations in Five-Star Resorts in Hurghada City, Egypt on Guest Satisfaction

doi:10.21203/rs.3.rs-3608857/v1

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The Impact of The New Trends and Innovations in Five-Star Resorts in Hurghada City, Egypt on Guest Satisfaction

https://doi.org/10.21203/rs.3.rs-3608857/v1

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Egypt is a country that highly relies on the tourism industry. Following the new trends and innovations are significant for development of resorts. In this study, researcher analyzed trends, challenges and innovations in selected five-star resorts in Hurghada City. This paper further discussed innovation in selected five-star resorts, and the impact affected by innovations and innovative practices in resorts. Qualitative research techniques were used in this study. In-depth interviews were conducted in English with three officials from selected five-star resorts to collect primary data. Observation method was also employed to observe the surroundings and layouts in selected resorts. Secondary data were mainly collected from journal articles, reports, and books and websites. The study employed thematic analysis and content analysis to express findings. The results showed innovation outputs which belong to product innovation, service innovation and administrative innovation respectively. Findings also indicated that resorts utilized both interior and exterior approaches to follow up new trends and innovation. Furthermore, these innovations and innovative practices improved guests’ satisfaction and business performance for the resorts.

Hospitality and Tourism

Egypt

New Trends

Innovations

Five-star Resorts

Guest Satisfaction

Innovation in tourism and hospitality is vital for business survival, competitiveness and growth (Orfila-Sintes and Mattsson, 2009; Ottenbacher, 2007; Sundbo et al., 2007). Its positive impact on guest preference, service quality, employee productivity, firms’ market value and share and guest retention is widely recognized (for a review, see Gomezelj, 2016; Hall and Williams, 2008; Hjalager, 2010).

Despite its significance, innovation is a major challenge facing the hospitality industry (Hjalager, 2002; Miralles, 2010; Ottenbacher and Gnoth, 2005). Sundbo (2009) argues that innovation process in the service sector is generally less systematic than in manufacturing, rarely research-based and more often practice driven. Orfila-Sintes and Mattsson (2009) point out that innovation in the hospitality sector requires employee involvement and the participation of current and prospective guests.,. Hjalager (2010) specifically underlines the lack of quantitative research investigating innovation and its types in the hospitality industry.

Over the past few decades, tourism has seen continuous growth and deepening diversification to become one of the fastest growing economic sections in the world. Tourism has four main components, namely accommodation, transportation, food & beverage and attraction. One of the major components which always be composed of accommodation, food & beverage, leisure activity, spas, architecture and so forth, all elements are comprised of one broad word namely “resort”.

To attract more guests, enhance the guests’ loyalty and get competitive advantages, resorts need to improve from various aspects. This study aimed to discover the new trends and innovations in selected five-star resorts in Hurghada City, Egypt. Researcher conducted study within three phases. (1) It analyzed the reasons and drivers of innovations, trends, challenges and innovations in selected five-star resorts in Hurghada City. (2) It identified the practical innovations applied in business and assess innovation outputs. (3) It measured the guests’ satisfaction and business performance influenced by innovational practices. Accordingly, the research objectives are set as follows:

• To analyze trends, challenges and innovations in selected five-star resorts in Hurghada City.

• To examine how resorts follow up new trends and innovations.

• To discover innovation outputs and innovativeness in selected five-star resorts.

• To measure the guests’ satisfaction and business performance affected by innovations and innovative practices in selected five-star resorts.

2.1. Hurghada City

Hurghada has grown from a small fishing village to one of the largest resort destinations along the Red Sea coast, stretching close to 40 km in Egypt, Hurghada was founded in the early 20th century. For many decades it was a small fishing village, but it has grown into a major Red Sea resort as a result of Egyptian and foreign investment that began in the 1980s. Hurghada's major industry is foreign and domestic tourism, owing to its landscape, year-round hot and dry climate and long beaches. (Red Sea Government, 2022).

The core factor of resort and hospitality industry is service where the recipient of service is guest, service innovation is critical to satisfying guest expectation for new experiences. Hackett & Melia (2012) argued that modern resort guest is searching for unique experiences, new challenge, and multi-entertainment in the form of action, emotion and entertainment. Resorts require considerable understanding new trends, guest desires and expectations (Elliot & Johns, 1993). Resorts need to consider more customizable to meet guests’ needs. The resort sector has emerged as a new trend in Hurghada City, Egypt where guest satisfaction is always a concern of practitioners.

Jayawardena et al. (2013a) pointed out that hoteliers should face three main challenges namely economic downturn, competition and human resources. Rayna & Striukova (2009), Sipe & Testa (2009) and Anthonisz (2014) stated that although competition in hospitality industry is serious, competition creates pressure to change and with the purpose of stand out of the competition. Anthonisz (2014) claimed that organizational culture and local ownership of the brand are directly influencing innovation within the resorts. Jayawardena et al. (2013b), Anthonisz (2014), Hackett & Melia (2012), Sturman (2011) and Michelli (2011) indicated that tourists in the future will be more sophisticated, educated and well-travelled. They are looking for better value of money and more than traditional hospitality product.

Hoteliers have to provide a product that meets the needs of tomorrow guest who is value conscious. Hoteliers also have to understand the term “value pricing” which means that they need to offer a high and wide variety of products exceeding guests’ expectation (Hackett & Melia, 2012). Sturman (2011) argued that hospitality manager is to find methods to improve guest’s experience by highlighting their awareness of the enjoyable experiences they will have, are having and did have.

According to Michelli (2011), guests today willing to be thrilled, to feel extraordinary satisfaction by getting much more value, attention, or enjoyment than they expected. Innovative technology and technological innovations are major trend and innovation in tourism and hospitality industry (Jayawardena et al., 2013b; Anthonisz, 2014; Rayna & Striukova, 2009). However, Anthonisz (2014) and Rayna & Striukova (2009) argued that it is probably hard to survive without using technology in modern hospitality industry, but the very nature of high-end resort business is that human contact which is usually more valuable than impersonal technology.

2.2 Defining Innovation

Innovation is derived from the Latin word 'nova', which means 'new'. Innovation is “the period in which knowledge gained commercial value through the modification, consolidation or synthesis of information in the form of new source, product, process, service, management technique or technology that creates original, correlated, unique solutions and value to fulfill organizational functions" (Altuntas and Donmez, 2010).

Innovation is a commonly used term, in various settings and with different meanings. It is often associated with aspects such as creativity, novelty, value creation and economic growth. Schumpeter (1934) described innovation as “the creation of new possibilities for additional value added, taking into account not only the typical product/process innovation of manufacturing but also market, organizational, and resource input innovation” (in Martinez-Ros and Orfila-Sintes, 2009, p. 633). Innovations are functions of “creative destruction” (Schumpeter, 1934), which challenges market equilibriums and provide new opportunities for exploration and revitalization by existing and new firms.

2.3 Guest Satisfaction in Hospitality Industry

Guest satisfaction is characterized as a factor that determines whether a post purchase attitude reflects a favorable or unfavorable outcome depending on individual guest experience (Canny, 2014), (Bahia et al.,2023). It is a fulfilment of the demand from the public (Zhong & Moon, 2020). There are three aspects of guest satisfaction: suitability of the satisfaction, desire to suggest, and repurchase intention (Namkung & Jang, 2008).

Repurchase intent depicts guests' potential to engage in future behaviors, whereas behaviors reflect the level of conduct that can be objectively observed (Namkung & Jang, 2008). It is described as the guest's intent to buy goods or services again in the future (Wang & Yu, 2016). The four components of guest retention are transactional, referential, preferred, and exploratory, according to Ferdinand, who is cited by (Saidani and Samsul, 2012).

3.1. Population and Sample

The target population for this study was with three officials from selected five-star resorts to collect primary data. Observation method was also employed to observe the surroundings and layouts in selected resorts. Secondary data were mainly collected from journal articles, reports, and books and websites. The study employed thematic analysis and content analysis to express findings. In Hurghada City Resorts due to time and financial constraint. Similarly, the sample selection for this study was a convenient sample due to time and financial constraint. Hence, the questionnaire was directly administered and collected.

This study employed qualitative method to examine new trends and innovations in selected five-star resorts in Hurghada City. Qualitative approach was appropriate to get meaningful and deep understanding from informants. Qualitative techniques are commonly used in leisure and tourism research (Veal, 2006).

Initially, this study collected the secondary data mainly from Emerald journal articles, reports, books and authorized tourism websites. Primary data were collected through semi-structured checklist questions of in-depth interview with three leading resorts officials from five-star resorts in Hurghada City. The interviewees were selected according to preliminary contact, permission, accessibility and reciprocal consent to take part in this research based on purposive sampling method.

All interviews were conducted on condition of anonymity. The name of the resorts and informants were not disclosed in the research. Interviews were conducted from 15th July to 28th July 2023. A semi-structured checklist of 15 questions was used to collect information. Half hour interviews were conducted in the English language. Each interview was recorded and then transcribed.

During the research in selected resorts premises, the researcher employed direct observation on the same day of interview to examine the layout and decorations in physical innovative places. Two resorts tours were organized by informants who accepted to be interviewed. The resort tours interviews revealed the main trends and innovations in two selected resorts. Thematic analysis and content analysis methods were used to analyze the data obtained from in-depth interviews and observation. All the transcribed interview records and notes were converted into word file, then researcher read transcripts verbatim to discover the information which interviewees said. Coding, categorizing, abstracting and summarizing raw data were employed to analyze data and conclude the findings.

3.2 Findings

The first part of this study is to assess the true nature of innovation and to discover the drivers that create innovations. The trends, challenges and innovations are summarized as follows:

3.2.1 New Trends in Five-star Resorts in Hurghada City.

Coding, categorizing and abstracting were employed to classify informants’ opinions into various codes and themes. There are four main trends in selected five-star resorts, namely: (1) The green and sustainable concept has already become the industry regulation in terms of responsibility and care of society. In daily resort operation, hoteliers try to act responsibly to minimize carbon footprint and impact on the environment and try to use more green energy to reduce resource consumption.

Meanwhile, guests would like to find resorts with green practices, offering organic food and rewarding local communities. Green and sustainable concept is also considered by conscious guests. (2) Interviewees mentioned the technology that is used in resort such as mobile check-in, pad controlled or voice-controlled guest room and high-tech meeting room. This technology provides smart and convenient service to guests which can improve their experience during their stay. (3) Resort operators have to think from the view of guests. Focusing on guests’ experience and doing research on guests’ behavior which develops into one trend of resort running. Resorts are now being required to recreate, to offer a memorable experience which has to fit with needs of guests. Fourthly, due to economic down turn around the world, the booming and robust Middle Eastern countries turns into main tourism markets.

3.2.2 Challenges in Five-star Resorts in Hurghada City.

There are three main challenges. Initially, though tens of millions of international tourists came to Hurghada City every year, to attract tourists to return to that very resort and survive in fierce competitions is really difficult. Local brand resorts compete not only among themselves but also with leading global resorts brands who are considered strong competitors. Developing guests’ loyalty while and competing with resorts in the similar location, offering the similar service and price is tough.

Operational space should be considered by hoteliers. Some resorts are located near the Red Sea Beaches while some of them are in the center of city. Some resorts which have been existing for a long while needs renovation to provide big rooms and space for group check-in, meetings and dining. Finally, in tourism and hospitality industry human contact and face to face service is important. Service quality is also affected by employees. The image of the resort and guests’ satisfaction are highly influenced by the people who provide service. This is quintessential of success in resort operation. Resorts have to concentrate on human resource management.

3.2.3 Innovations Existed in Five-star Resorts in Hurghada City.

The major innovations identified by informants in five-star resorts in Hurghada City as follows. First of all, technological innovations, such as electronic check-in, I Pads in guest rooms that provide guests with smart and convenient control of facilities. Motion control technique also used in some cutting-edge resorts. Creating a homey and comfortable atmosphere in resort room is another innovation where the resort provides kitchen and real wooden floors in guest rooms. In addition, the innovation on different creative themes such as campus and health themes, plus different kinds of spa that could be new selling points to resorts. Those innovations make the resort more active and attractive.

3.3 Resorts Follow up New Trends and Innovations.

Participants who follow up the trends and innovations for local branches and subsidiaries, predominant tasks are mainly on operations. Furthermore, local branches of resorts do not have that strong power to change the style and trend. The R&D department or specific people who take in charge of these issues in local resort are the headquarters or regional offices which usually do the research and design.

3.4 Approaches to follow up the trends and innovations.

The responses of interviewees were divided into two types of approaches. One type is to follow up trends and innovations from inside, and another type of methods is to follow up trends and innovations from outside. Companies disseminate information and study novelties and newness through interior meetings. In addition, hoteliers also can keep track on new trends and innovations directly from their guests.

The observation of guests’ behavior can provide data on what guests are looking for Learning and thinking from inside are far from enough so hoteliers have to broaden their horizon by studying from the outside. Professional workshops and seminars provide good platform to follow the new trends and exchange opinions from experts. Industry association can be an important role in disseminating and leading the trends. Professional market survey from headquarters can support operation of local resorts efficiently. Both interior and exterior approaches can help hoteliers to follow up the new trends and innovations.

3.5 Innovations outputs and innovativeness in selected five-star resorts.

According to Sipe & Testa (2009), the categories of innovation outputs can provide preliminary research into hospitality and tourism innovation study. This typology provided a relatively clear and useful classification to both scholars and practitioners.

According to the interviews, there are seven innovation outputs in selected resorts. It is hard to separate service innovation and product innovation in hospitality industry. There are three innovations from resort A and B in level 6. Resorts have to do something new, something challenging and even something impossible. Meanwhile, there were three innovations in level 5 which reviewed from Table 1. Benchmarking to learn what other companies are doing and enhancing their service, such as handicapped facilities, transparent glass barrier near riversides restaurants and international employees already became industry benchmark and regulations which can improve guests’ satisfaction. In the last column, the researcher illustrates the unit of implementation. Three out of seven innovations are implemented just in company level, it means that these innovations are unique and distinct features only in their companies.

One innovation is in department level which states that this new concept is only used in certain department. Other innovations are in the industry level, it illustrates that these innovations are applied as standard in hospitality and tourism industry.

Table 1

Innovation Outputs and Innovativeness in Selected Three Resorts in Hurghada City.
Description of innovation outputs	Type of innovation	Degree of innovativeness	Unit of implementation
Hotel A Kitchen and utensils	Product/service	Level 6- Different	Company
Hotel A 25m Long table	Product/service	Level 6- Different	Company
Hotel B Campus concept	Service	Level 7- Impossible	Company
Hotel B Residential style	Service	Level 6- Different	Department
Hotel C Transparent barrier	Product/Service	Level 5- Copying	Industry
Hotel C Handicapped facility	Product/Service	Level 5- Copying	Industry
Hotel C International employees	Service	Level 5- Copying	Industry

3.6 Guests’ satisfaction and business performance.

After innovations and innovative practices are implemented, guests’ satisfaction and business performances are improved. According to interviewees “improvement of guests’ satisfaction” is the most significant effect of innovations. The innovations will impact on future resort operations. Resort businesses have to provide guest experiences that fit their needs. Some innovations and concepts can attract specific group of guests, and even a number of guests came just for the new concepts. Modern technologies, eye-catching service and concepts can be efficient development for attracting tourists.

The informants described that “attracting more guests”, “bring more revenue” and “profit unique selling point” are the key words for improvement of business performance impacted by innovations. According to the response of interviewees there is no specific figure comparison between pre-innovation and post-innovation from business performance. But all the informants claimed that innovations benefit resort operation, whether in the form of resort profit or market share. Successful innovations make the guests become even more enthusiastic for new concept for new and repeat guests.

The results show that green and sustainable, technology and concerning guests’ needs are common trends in five-star resorts in Hurghada City. These findings match with the findings of Jayawardena et al. (2013b), Hackett & Melia (2012) and Anthonisz (2014) that environmental concern and technological utilization are important for modern resorts. Secondly, the guests from European countries such as Germany, England, Poland and Russia are main target for five-star resorts in Hurghada City. The result was supported by study conducted by Jayawardena et al. (2013b), who stated that Egypt is one of the key factors that dominate the future of the international Hospitality industry.

Thirdly, international employees can be a unique selling point for five-star resorts in Hurghada City. This finding is similar to the findings of Jayawardena et al. (2013a), Hackett & Melia (2012) that it is necessary for staff to be experts in different aspects such as IT, marketing and languages. Besides that, there are some trends like single lady tourists and repeated tourists which were not mentioned in previous researches.

Competition is one of challenges faced by resorts. In Jayawardena et al. (2013a), Rayna & Striukova (2009) and Anthonisz (2014) studies, they concluded that a major challenge in tourism and hospitality industry is intensive competition between different brands and even from other countries. Human contact is still important for hospitality industry, so maintenance and development of staff is one critical factor. This finding matches with the findings of Jayawardena et al. (2013a) that align the resort staff behavior and attitudes with the brand is essential for success in resort management. Moreover, company culture affects innovative decisions in resort as well. Likewise, Anthonisz (2014) and Sturman (2011) found that the innovation within the resort is directly linked to the organizational culture and ownership of the brand.

Most of the five-star resorts in Hurghada City do not have R&D Department so they need to follow the design from headquarters. Sometimes the timing and budget are also overdue. The result is supported by study conducted by Anthonisz (2014), who stated that innovation must remain at the top of the agenda, specifically in a destination where competition is intensive.

The researcher found that it is difficult to separate product and service innovation in the tourism and hospitality industry. Major innovations belong to innovativeness level 5- Copying, level 6-Different and level 7-Impossible in selected resorts in Hurghada City. Majority of innovations were implemented in the company and industry levels. The result was supported by study conducted by Sipe & Testa (2009) who stated that a classification framework provides a common term to discuss the ambiguous concept of innovation and innovativeness degree.

Innovations and innovative practices improved guests’ satisfaction and guests got better experience from the novelty and newness. Innovations assist companies to improve financial performance, increase the market share and administrative efficiency. Likewise, Jayawardena et al. (2013a), Rayna & Striukova (2009), Hackett & Melia (2012) and Anthonisz (2014) found that the hospitality industry has made considerable number of innovations intended to improve guest experience, create operational efficiency and develop more sustainable approaches to doing business.

The findings showed that green and sustainable, high-technology, thinking from guests’ side and European guests are the main trends in resorts in Hurghada City. There are three main challenges faced by hoteliers which are: branding and competition, operational space in resorts and human resource. The study described many innovation outputs which belong to product innovation, service innovation and administrative innovation, respectively. The findings also indicated that resorts utilized many interior and exterior methods to follow up new trends and innovation. Furthermore, these innovations and innovative practices have improved guests’ satisfaction and business performance for the resorts.

Acknowledgements

I would like to express my gratitude to the following people who supported this work through their inspiration, as well as moral and academic support: My family near and far, and my professors.

Availability of data and materials

This is available on request.

Ethics Approval

This article does not contain any studies with human participants performed by any of the authors.

Informed Consent

This article does not contain any studies with human participants performed by any of the authors.

Consent for publication

The authors hereby give their consent for the publication of this article.

Competing interests

The authors declare no competing interests.

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The Impact of The New Trends and Innovations in Five-Star Resorts in Hurghada City, Egypt on Guest Satisfaction

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Abstract

1. Introduction

2. Literature review

2.1. Hurghada City

2.2 Defining Innovation

2.3 Guest Satisfaction in Hospitality Industry

3. Methodology

3.1. Population and Sample

3.2 Findings

3.2.1 New Trends in Five-star Resorts in Hurghada City.

3.2.2 Challenges in Five-star Resorts in Hurghada City.

3.2.3 Innovations Existed in Five-star Resorts in Hurghada City.

3.3 Resorts Follow up New Trends and Innovations.

3.4 Approaches to follow up the trends and innovations.

3.5 Innovations outputs and innovativeness in selected five-star resorts.

3.6 Guests’ satisfaction and business performance.

4. Discussion

5. Conclusion

Declarations

References

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