EFFECT OF ONLINE ADVERTISING FEATURESON CUSTOMER SATISFACTIONIN SELECTED FIVE-STAR HOTELS IN NAIROBI

COUNTY,KENYA

CAROLYNE KIPROP

SBE/PGM/013/12

A RESEARCH THESIS SUBMITTED TO THE SCHOOL OF BUSINESS AND ECONOMICS IN PARTIAL FULFILLMENT OF THE

REQUIREMENTS FOR THE AWARD OF DEGREE IN

MASTERS OF BUSINESS MANAGEMENT

MOI UNIVERSITY

October, 2017

DECLARATION

Declaration by the student

This research thesis is my original work and has not been presented for a degree in any other university or institution. This project should not be reproduced without prior permission of the author and/or Moi University.

Sign……………………… Date……………………...

Carolyne Kiprop

SBE/PGM/013/12

Declaration by the Supervisor

This thesis has been submitted for examination with our approval as University Supervisors. It represents the work carried out by the candidate under our supervision.

Sign………………………......... Date……………………......

Dr. Joel Chepkwony

Senior lecturer

School of Business and Economics

Moi University

Sign………………………..................... Date…………………….....

Dr. Peter K. Rutto

Lecturer

School of Business and Economics

Moi University

DEDICATION

I dedicate this thesis to my family. I treasure the love and peace you gave me during my studies.

ACKNOWELDGEMENT

I wish to sincerely appreciate my supervisors Dr. Joel Chepkwony and Dr. Peter Rutto whose tireless effort, unwavering guidance and continuous support proved very useful in developing this thesis.

I am also greatly indebted to my parents, my lovely husband, my siblings and the School of Business and Economics for their moral and emotional encouragement in my studies.

Last but not least, am grateful to The Almighty God for giving me the ability, will and resources to get this far in my academic endeavors.

ABSTRACT

Over the past years, the hospitality industry has contributed immensely to Kenya’s economy. In the recent years, online advertising features has been widely used for marketing diverse products and services. In Kenya, the hotel industry has begun to recognize the importance of understanding online advertising features as a contributing factor for customer satisfaction. The industry can contribute even more if proper and better attention is given to the delivery service in the sector. The purpose of the study was to establish the effects of online advertising features on customer satisfaction in selected five-star hotels in Nairobi County, Kenya.The study examined the hotel industry in Nairobi and investigated online advertising features such as Multimedia, Picturesand Content on the dependant variable Customer satisfaction. The study was guided by Kano’s satisfaction model and dissonance theory. The research design employed was explanatory research design because it explains the features of the variables and at the same time explain cause effect relationship between variables.The target population was 2500 customers drawn from 15 five-star hotels in Nairobi County. The five-star hotels were selected since they possess the features of interest to the study. The sample size was determined using Yamane formula which gave a sample size of 345 customers. Purposive sampling was undertaken to select customers who had done online booking. The customers were selected proportionately by simple random sampling based on the number of customers in each selected hotel. The study utilized a questionnaire administered to hotel customers. Reliability of data was tested using Cronbach’s Alpha. Both descriptive and inferential statistics were used to analyse the data. Pearson correlation analysis and multiple regression analysis were used to test the relationships among variables. The study results revealed that Multimedia feature in online advertisement (β1=0.160, p- 0.008<0.05), Picture feature in online advertisement (β2=0.073, p- 0.015<0.05) and Content feature in online advertisement (β3=0.152, p- 0.009<0.05) had a significant effect on customer satisfaction. In conclusion, multimedia feature was found to have the highest effect on customer satisfaction followed by picture and content feature respectively. The hotels should therefore enrich their online advertisement using multimedia features. The hotel management in their pursuit to enhance competitiveness in the market should maximize on the use of picture in their websites and advertisement. The hotels should incorporate informative contents about their brand in their online advertisements. A similar study may be carried out in all five-star hotels in Kenya in order to allow for generalization of the results. A study may also be conducted on effects of television advertisement features on customer satisfaction in hotel industry.

TABLE OF CONTENTS

DECLARATION	i

DEDICATION	ii

ACKNOWELDGEMENT	iii

ABSTRACT	iv

TABLE OF CONTENTS	v

LIST OF TABLES	vii

LIST OF FIGURES	viii

LIST OF ABREVIATION	ix

OPERATIONAL DEFINITION OF TERMS	x

CHAPTER ONE	1

INTRODUCTION	1

1.0 Overview………….	1

1.1 Background of the Study	1

1.1.1 Hotel Classification	4

1.2 Statement of the Problem	9

1.3 General Objective	10

1.3.1Specific Objectives	10

1.4Research Hypotheses	11

1.5 Significance of the Study	11

1.6 Scope of the Study	12

1.7 Limitations of the Study	12

CHAPTER TWO…	13

LITERATURE REVIEW	13

2.0 Introduction……….	13

2.1 Theoretical Perspective	13

2.1.1 Kano Satisfaction Model	13

2.1.2 The Dissonance Theory	15

2.2 The Concept of Customer Satisfaction	17

2.3The Concept of Online Advertising	19

2.3.1 The Relationship Between Multimedia Advertisements on Customer Satisfaction	25

2.3.2 The Relationship Between Pictures Advertisement on Customer Satisfaction	26

2.3.3 The relationship between content advertisements on customer satisfaction	28

2.3.4 Advertising and Customer satisfaction	31

2.4 Conceptual Framework	35

CHAPTER THREE	36

RESEARCH METHODOLOGY	36

3.0 Introduction……….	36

3.1 Study Area…….	36

3.2 Research Design	37

3.3 Target Population	37

3.4 Sampling Design and sample size	38

3.4.1 Sample Distribution	39

3.5 Data collection Instruments and Procedure	40

3.5.2 Data Collection instrument	41

3.6 Measurement of variables	42

3.6.1 Dependent variable	42

3.6.2 Independent variable	42

3.7 Validity and Reliability	43

3.8 Pre-testing….	43

3.9 Data Analysis	44

3.10 Ethical Consideration	45

DATA ANALYSIS, PRESENTATION AND INTERPRETATION	46

4.1 Introduction………	46

4.2 Respond Rate	46

4.3 Demographic Information	46

4.4 Descriptive Information on Customer Satisfaction	47

4.5 Descriptive Analysis on Multimedia in Online Advertising	48

4.6 Descriptive Analysis on Picture in Online Advertising	50

4.7 Descriptive Analysis of Content Online Advertising	51

4.8.1 Multi-media Factor Analysis Results	53

4.8.2 Picture Advertisement Factor Analysis Results	54

4.8.3 Content Advertisement Factor Analysis Results	55

4.9 Correlation analysis	56

4.10 Multiple Regression Analysis	58

4.10.1 Assumptions of Regression Model	58

Test of Normality	58

Test of linearity……….	59

Test of Multicollinearity	61

4.10.2Model Summary	62

4.10.3 Analysis of Variance	63

4.10.4 Coefficients	63

4.10.5Test of Hypotheses	64

CHAPTER FIVE	66

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS	66

5.0 Overview…….	66

5.1 Summary of Findings	66

5.1.1 Multimedia Advertisement on Consumer Satisfaction	66

5.1.2 Pictures Advertisement on Customer Satisfaction	67

5.1.3 Content Advertisement on Customer Satisfaction	68

5.2 Conclusion of the Study	69

5. 3 Recommendation of the Study	70

5.4 Areas for further studies	71

REFERENCES	72

APPENDIX I: CUSTOMER QUESTIONNAIRE	79

APPENDIX II: NAIROBI CBD MAP	83

LIST OF TABLES

Table 3.1 Sampling frame showing the Target Population	38

Table 3.2: Sample size determination/distribution	40

Table 3.3Reliability Test	44

Table 4.1 Demographic Information For Respondent	47

Table 4.2 Mean Standard Deviation for customer satisfaction	48

Table 4.3: Mean and Standard Deviation for Multimedia in online advertising	49

Table 4.4 Mean Standard Deviation on Picture in Online Advertising	Error! Bookmark not defined.

Table 4.5 Mean Standard Deviation for Content in Online Advertising	52

Table 4.6: Multi-media factor analysis	54

Table 4.7: Picture advertisement factor analysis	55

Table 4.8: Content advertisement factor analysis	56

Table 4.9Correlation Results	Error! Bookmark not defined.

Table 4.10: Tests of Normality	59

Table 4.11: Multicollinearity results	61

Table 4.12Model Summary	62

Table 4.13: ANOVAa	63

Table 4.14 Coefficientsa	63

Table 4.15: Summary	65

LIST OF FIGURES

Figure 2.1: Kano Model of Customer Satisfaction	15

Figure 2.2: Conceptual Framework on online advertisement features on customer Satisfaction…………..	35

Figure 4.1Linearity Plot	60

Figure 4.2Linearity Plot	60

Figure 4.3:Scatter Plot for Homoscedasticity	62

LIST OF ABREVIATION

ACSI: American Customer Satisfaction Index

ROA: Return on Assets

ROE: Return on Equity

IT: Information Technology

IAB: Interactive Advertising Bureau

PwC: Price waterhouse Coopers

OPERATIONAL DEFINITION OF TERMS

Customer satisfaction: This is the customer fulfillment response that is judgment that a product or service itself is providing a pleasurable level of fulfillment.

Advertisement: Refers to any paid form of non-personal communication of ideas and information about products in the media with the aim of creating a brand image

Online advertising: Advertising products through internet platform

Multimedia advertising: A form of expression describing elements of online contents such as audio, video and animation

Animation: Incorporates moving images and graphics, it improves the design and interactivity of online advertisements.

Picture advertising: Images that make the online advertising appear more attractive to consumers

Content advertising: Written information about products or services

Hotel: An establishment that provides both accommodation and meals and provides a variety of services needed by customers such as reception, conference facilities and recreational facilities.

Customer: Refers to a recipient of a service obtained from a provider for a monetary or other valuable consideration.

Customer Loyalty: Refers to the achievement of the ultimate reward by an organization for the way it interacts with its customers.

Loyalty: Refers to faithfulness or commitment to someone or something based on certain ideas, in this study it refers to when a customer develops preference to a hotel.

Informative knowledge: Refers to educative nature of an advertisement feature

Attractive images: Refers to visual advertisement features captivating/appealing to the customers

Referrals: Refers to the act of advising somebody to a hotel

Audio: Refers to advertisement feature that can be detected through hearing

CHAPTER ONE

INTRODUCTION

1.0 Overview

The chapter presents an overview of the effects of online advertising features on customer satisfaction in selected five-star hotels in Nairobi County in Kenya. It contains the background to the study, the statement of the problem, objectives of the study and the research questions that the study seeks to answer. The significance and scope of the study is also presented.

1.1 Background of the Study

Customer satisfaction is the actual manifestation that depends on a number of both psychological and physical variables felt by buyers who have experienced fulfilled expectations. The level of satisfaction can also vary depending on other options the customer may have and other services against which the customer can compare the organizations services. Prior research in the field of marketing has found support for the role of customer satisfaction (American Customer Satisfaction Index (ACSI) on firm economic performance, such as return on assets (ROA) and return on equity (ROE) (Fornell et al., 2006), and on models aimed at conducting company valuation. In a competitive market place where businesses compete for customers, customer satisfaction is a key differentiator and increasingly has become a key element of business strategy. It is a critical business requirement that could have a significant effect on customers’ intentions to repurchase (He & Song, 2009) and therefore, could affect a company’s market share (Sit et al., 2009). Customer’s behavioural intention of repurchase is preceded by customer satisfaction which is directly affected by disconfirmation resulting between a customer’s pre-purchase expectations and post-purchase performance of a product or service (chen et al., 2009). The rapid pace of information technology (IT) has transformed the internet into the most popular channel of communication in the world today. Search Marketing is a term applied to marketing techniques implemented at Search Engines such as Google, Yahoo! or Ask.com in order to drive and increase website traffic (Moran and Hunt, 2005). Search Engines have become the central access gate to booking a holiday or purchasing tourism products and services.

The main principle of media in the world according to Rowley (2005) is to connect and bring information to the audience. The online business has shown considerable growth and improvement over the last couple of years, which was dependent on the enhanced information technology and telecommunication. The increased use of the Internet and electronic commerce has had positive effects on the tourism sector, as described by Cooper et al., (2008). Tourism online business is growing fast and competition is fierce. Online advertising is essential in this particular industry for companies to gain customers and therefore to make profit. Tourism-related businesses need to understand the full potential of this marketing tool in order to succeed against the major players. Through the Internet gaining more and more of importance, online advertising does too. Expansion possibilities as well as reaching out and penetrating new geographical markets are enhanced Cooper et al., (2008).

The internet’s high speed, user-friendliness, low cost, and wide accessibility have contributed to its commercialization in the form of online-marketing-a new platform for generating attention and awareness among consumers through online advertising (Rowley 2001).Hotel marketers have also resorted to utilise; online advertising features which comprise of multimedia, picture and content features to advertise their products and services, this means the internet has become a key advertising channel for many advertisers and with the rise of digital marketing over the last decade, the internet is more and more frequently one of those channels. According to the IAB Europe (2010) 18% of all European media spend in 2009 was allocated to online advertising totalling 14.7 billion Euros. Search engine and display advertising were the largest channels within digital advertising with shares of 46 and 30 per cent, respectively.

Internet advertising market has grown rapidly during the last decade since the appearance of the first Internet advertisement in 1994 (Hollis 2005). According to a recent report from the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC), Internet advertising revenues for 2007 are estimated to grow to $21.1 billion, a 25 percent increase over the previous revenue record of nearly $16.9 billion for year 2006 (IAB 2008). Also, the Kelsey Group recently provided an estimate of $45 billion for Internet advertising globally, and predicted Internet advertisement revenues to reach $147 billion globally by 2012 (Pacheco 2008). As more and more people spend time on the Internet, marketers believe that Internet advertising would be a goldmine. It is one of the many ways to get to know in a relatively quick fashion many things being advertised. It is also a convenient and quick way of finding information we need about products, services, businesses, etc. The objective of advertising is to create awareness of a company, a brand, a website, or an event in order to stimulate sales and increase profits. For a long time, television, radio, newspapers, and magazines have dominated the advertising media. Now, online advertising is becoming the driving force in many advertising initiatives and efforts (Kotler & Armstrong, 2010). Although online advertising is an effective tool to reach larger audiences, it is important that advertisers incorporate features to make it more effective. According to Tsang & Tse (2005), online advertising is widely used by companies and advertisers to promote their products and services (Kaye & Medoff, 2001). Firms have become very competitive and are consistently increasing the amount of money spent on advertisements that stimulate demand, and attract consumers. It is crucial that online advertising be effective in order to generate favourable responses from consumers. Online advertising features, therefore, play a significant role (Armstrong,2001; Adam,2003; Baltas,2003; Kumar,2008; online publishers’ association,2008) Since generating consumer response is important, it is worthwhile to examine how effective online advertising features is among customers’ satisfaction.

1.1.1 Hotel Classification

Hotel star rating frameworks look to evaluate hotel quality and deliberately rank foundations with the goal that clients realize what's in store at the season of booking. Star rating frameworks are proposed to fill in as rules for visitors who are reserving hotel spot and can be very useful. There is up until now, no global arrangement which has been embraced. There have been endeavors at bringing together the order framework with the goal that it turns into a universally perceived and dependable standard, yet they have all fizzled (World Tourism Organization, WTO, 2015).

Today the terms 'reviewing', 'rating', 'grouping 'and star rating are utilized to by and large allude to a similar idea, that is to rank and sort hotels by their offices and service gauges (World Tourism Organization, WTO, 2015).

There are wide assortments of rating plans utilized by various associations around the globe. Many have a framework including stars, with a more noteworthy number of stars showing more noteworthy extravagance. Forbes Travel Guide, once in the past Mobil Travel Guide, propelled its star rating framework in 1958. The AAA and their partnered bodies utilize precious stones rather than stars to express hotel and eatery appraisals levels.

Nourishment services, diversion, see, room varieties, for example, measure and extra pleasantries, spas and wellness focuses, straightforward entry and area might be considered in setting up a standard. Hotels are freely surveyed in conventional frameworks and lay intensely on the offices gave. Some consider this disadvantageous to littler hotels whose nature of convenience could fall into one class yet the absence of a thing, for example, a lift would keep it from achieving a higher classification (World Tourism Organization, WTO, 2015).

As of late hotel rating frameworks, have additionally been scrutinized by some who contend that the rating criteria for such frameworks are excessively perplexing and troublesome for laypersons to get it. It has been proposed that the absence of a brought together worldwide framework for rating hotels may likewise undermine the convenience of such plans.

In the United States, hotels are for the most part positioned on a scale from one to five stars, once in a while utilizing half star increases.

Here's a breakdown on what you can anticipate from hotels that convey a particular rating.

5-Star Rating: Luxurious hotels, offering the most astounding level of individual service. Class and style flourish, the rooms are furnished with quality cloths, VCR, CD stereo, Jacuzzi tubs, and in-room video. There are numerous eateries on location with broad gourmet menus, and room-benefit is additionally accessible day in and day out. A wellness focus, valet stopping, and attendant service round out the experience.

4-Star Rating: Formal, vast hotels, with first rate benefit. Better than expected service, wonderfully outfitted rooms, eateries, room benefit, valet stopping, a wellness focus, and an attendant are a few courtesies to anticipate.

3-Star Rating: Usually situated almost a noteworthy road, business focus, and additionally shopping region, these hotels offer pleasant, open rooms and beautifying halls. On location eateries might be normal in measure however will offer breakfast, lunch, and supper. Valet and room benefit, a little wellness focus, and a pool are frequently accessible.

2-Star Rating: These hotels are by and large piece of a chain that offers reliable quality and constrained luxuries. They are little or medium in size and rooms will have a telephone and TV. While you won't have the comfort of room benefit, there ought to be a little eatery on location.

1-Star Rating: Expect a little hotel oversaw and worked by the proprietor. The environment will be more individual and the housing essential. Eateries ought to be inside strolling separation, and additionally adjacent open transportation and diversion that is sensible in cost.

Despite the fact that star appraisals can appear to be subjective, they can in any case be useful and can educate you about an hotel. For example, a four-or five-star hotel is continually going to be more sumptuous than a maybe a couple star hotel. Similarly, a one-star hotel will be an economy motel and a two-star hotel will be a higher-end motel or spending hotel. Be that as it may, even one-and two-star hotels will typically have the majority of the pleasantries you require for a night's rest. Be that as it may, in case you're looking for higher end enhancements, for example, room benefit, Internet get to, films, rich cloths, wellness focus get to, and so forth, you'll presumably need to take a gander at hotels that are appraised three stars or more. Three-star hotels are modestly estimated hotels that are agreeable, however they may do not have a portion of the advantage of four-star hotels. A five-star rating is held only for the nation's most astounding end chain and boutique hotels. Hope to pay a premium for five-star extravagances.

Note that hotel star evaluations contrast from nation to nation. While in the U.S. a five-star hotel will offer turndown benefit and customized wake-up calls, and highlight rich rooms and advanced environment, in numerous European nations a five-star hotel room must incorporate a customized welcoming with blooms or a blessing and a one-hour pressing service.

The more typical order frameworks incorporate "star" rating, letter reviewing, from "A" to "F", precious stone or just a "tasteful" or "unsuitable" commentary to convenience, for example, hotels and motels. Frameworks utilizing terms, for example, Deluxe/Luxury, First Class/Superior, Tourist Class/Standard, and Budget Class/Economy are all the more broadly acknowledged as hotel sorts, instead of hotel standard.

A few nations have rating by a solitary open standard. Belgium, Denmark, Greece, Italy, Malta, Netherlands, Portugal, Spain and Hungary have laws characterizing the hotel rating. In Germany, Austria and Switzerland, the rating is characterized by the separate hotel industry affiliation utilizing a five-star framework. the German characterizations are Tourist (*), Standard (**), Comfort (***), First Class (****) and Luxury (*****), with the stamp "Unrivaled" to signal additional items past the base characterized in the standard, yet insufficient to move the hotel up to the following level positioning. The Swiss hotel rating was the primary non-government formal hotel arrangement starting in 1979 It influenced the hotel grouping in Austria and Germany.

In Great Britain hotels are evaluated from one-star to five stars. The RAC hauled out of convenience reviewing in 2008 so the main evaluating plans in operation are those worked by the AA (Automobile Association) and the national visitor sheets: Visit England, Visit Wales, the Scottish Tourist Board and the Northern Ireland Tourist Board. The plans were altogether "orchestrated" to guarantee consistency between the plans. This applies to all convenience sorts separated from self-providing food that the AA began offering in 2009. The AA criteria are accessible on its site. Notwithstanding the standard dark stars (running from one (the least) to five (the most astounding), the AA grants red stars to the most astounding evaluated, which are considered "Assessors" Choice'. Each of the national traveller sheets have evaluating clarifications on their website

The HOTREC (Hotels, Restaurants and Cafés in Europe) is an umbrella association for 39relationship from 24 European nations. At a meeting in Bergen in 2004, the accomplices drafted a hotel arrangement framework keeping in mind the end goal to orchestrate their national models. In 2007 HOTREC propelled the European Hospitality Quality plan (EHQ) which has since licensed the current national assessment bodies for hotel rating (HOTREC, 2011).

A few hotels have been promoted as seven-star hotels. The Burj Al Arab hotel in Dubai was opened in 1998 with a hireling for each room - this has been the main hotel being broadly depicted as a "seven-star" property, yet the hotel says the name begins from an anonymous British writer on a press trip and that they neither empower its utilization nor do they utilize it in their promoting. Correspondingly the Emirates Palace Hotel in Abu Dhabi (open since 2005) is some of the time depicted as seven- star too, yet the hotel utilizes just a five-star rating.

Grouping offers a sign of what is not out of the ordinary, it gives a typical structure to all middle people, for example, visit administrators and travel offices to use in their buying procedures and transaction additionally hotel characterization fills in as a showcasing and limited time apparatus for settlement suppliers (UNWTO, 2015).

Kenya has near 500 authorized hotels of global principles to look over. Kenya hotels show the most different scope of settlement to suit each taste. Class, style, climate and quality service are the major recognizing variables of Kenya's hotels and amusement lodges. Kenya hotels are reviewed as per the star groupings framework. They extend from the residential area hotels to the five-star town and shoreline hotels (UNWTO, 2015).

1.2 Statement of the Problem

The hotel industry has become very competitive and is considered to be in the mature stage of its lifecycle (Kandampully & Hu, 2007). As such customer satisfaction is potentially an effective tool that hotels can use to gain a strategic advantage & survive in today’s ever increasing competitive market. Customer satisfaction with hotel services is an area of growing interest to researchers and managers (Singapore Management Review, 2008). Today’s winning hotels are focusing on continually satisfying their customers and beyond.

Hospitality industry can contribute even more if proper and better attention is given to the delivery of this sector (Annual Hospitality Market report 2009). The major factors contributing to this undesirable sales performance are probably; low levels of awareness, low satisfaction levels and low incomes of the clients (Annual Hospitality Market Report 2009). Recently, hundreds of hotel companies are doing advertisements through the internet. The boom of Internet and electronic advertising in recent times has evoked several research efforts aimed at understanding customer service satisfaction in relation to the virtual business environment (Bansal et al., 2004; Yang & Peterson, 2004).

Online advertising feature is a new platform for marketers to create effective online advertising strategies to capitalize on this lucrative market segment. Online advertising is widely used by companies to promote their products and services (Kaye & Medoff, 2001) by doing so; they create expectation and perception on their products and services to consumers. It is crucial that online advertising be effective to generate favourable responses from consumers. Online advertising features therefore play a significant role (Adam, 2003). Three features are used in online advertising, based on models proposed by Escalas & Rutgers (2003). These are: Multimedia, Pictures, and Content. This research hence sought to fill this gap by looking at the effects of online advertisement features on customer satisfaction in selected five-star hotels in Nairobi County.

1.3 General Objective

The main objective of the study was to determine the effect of online advertising features on customer satisfaction in selected five-star hotels in Nairobi County, Kenya.

1.3.1	Specific Objectives

The study sought to establish the following objectives:

1)	To determine the effect of Multimedia advertisement features on customer satisfaction

2)	To establish the effect of Pictures advertisement features on customer satisfaction

3)	To determine the effect of content advertisement features on customer satisfaction

1.4	Research Hypotheses

HO1:	Multimedia advertisement features has no significant effect on customer satisfaction

HO2:	Picture advertisement features has no significant effect on customer satisfaction

HO3:	Content advertisement features has no significant effect on customer satisfaction

1.5 Significance of the Study

The study findings offered information which will be a basis for hotels to evaluate their online advertisement techniques towards enhancing hotel customer satisfaction. The findings provided an insight to influence positively the techniques of advertisement, hence a basis for policy and decision design in marketing mechanisms regarding advertisement which constitute a big proportion of the organizations’ budgets. The study will also be a source of reference materials for future researchers and students on related topic. The study will also be an empirical source for future research.

1.6 Scope of the Study

The study was conducted in selected hotels in Nairobi County. Nairobi provided a vast variety of hospitality establishments but for the purpose of the study only five star rated hotels were considered. The hotels provided a representative perspective of the industry since star rating provide a basis for almost uniformity in the products and services of establishments within the same star ratings. The study was limited to the study of effects of online advertisement features on customer satisfaction.

1.7 Limitations of the Study

The researcher encountered challenges during data collection, the major limitation was the unpredictable nature of the schedule of the customers who were the respondents of this study, the customers had a tight itinerary schedule and with limited free time to fill the questionnaires. To overcome this challenge, the hotel managers were requested to administer the questionnaires to the customers during their free time.

CHAPTER TWO

LITERATURE REVIEW

2.0 Introduction

This chapter presents literature review under the following section; the theoretical perspectives, the concept of customer satisfaction, the concept of online advertisement, the relationship between multi-media advertisement and customer satisfaction, the relationship between picture advertisement and customer satisfaction, the relationship between content advertisement and customer satisfaction, advertising and customer satisfaction and Conceptual framework.

2.1Theoretical Perspective

The study adopted a number of theories including; Kano satisfaction model theory and dissonance theory

2.1.1 Kano Satisfaction Model

Customers evaluate the quality of a product using several factors and dimensions. Therefore, it is important to identify which product criteria or attributes create more satisfaction than others. Kano et al., (1984)developed a two-dimensional model to explain the different relationship between customer satisfaction and product criterion performance. The Kano model classifies product criteria into three distinct categories, as shown in Fig.2.1. Each quality category affects customers in a different way. The three different types of qualities are explained as follows:

The must-be or basic quality: Here, customers become dissatisfied when the performance of this product criterion is low or the product attribute is absent. However, customer satisfaction does not rise above neutral with a high-performance product criterion.

One-dimensional or performance quality: Here, customer satisfaction is a linear function of a product criterion performance. High attribute performance leads to high customer satisfaction and vice versa.

The attractive or excitement quality: Here, customer satisfaction increases super linearly with increasing attribute performance. There is not, however, a corresponding decrease in customer satisfaction with a decrease in criterion performance. Besides these three, two more quality types can be identified: the indifference and reversal qualities (to be precise, they should call them characteristics because they are not really a customer need). For the indifference quality, customer satisfaction will not be affected by the performance of a product criterion. For the reversal quality, customers will be more dissatisfied with the increase of a criterion performance.

Matzler & Hinterhuber (1998)argued that the advantage of using the Kano Model to classify customer requirements is a better understating of product requirements. This permits designers to focus on priorities for product development. It is, for example, not very useful to invest in improving must-be qualities that have already reached a satisfactory level. It would be better to improve one-dimensional or attractive qualities because they have a greater impact on perceived quality, and consequently, on customer satisfaction.

Kano classification also provides valuable help in case of a trade-off situation in multiple criteria decision making. If two product criteria cannot be promoted simultaneously due to technical or financial reasons, the criterion with the greater influence on customer satisfaction should be enhanced first. In the study, the Kano model is integrated into the robust design approach to infer the optimal design parameters for achieving the highest customer satisfaction.

This theory was relevant to the study as it explains the three types of requirements that influence customer satisfaction which are; one-dimensional, attractive and must-be qualities, (Kano et al., 1984). It further posits the advantages of classifying customer requirements, in addition, Kano questionnaire illustrates that it might be helpful to have the customer rank their individual product indicating if they feel satisfied or dissatisfied with a given situation.

Figure 2.1: Kano Model of Customer Satisfaction

2.1.2 The Dissonance Theory

Dissonance theory suggests that a person who expected a high-value product and received a low-value product would recognize the disparity and experience a cognitive dissonance (Cardozzo, 1965). That is, the disconfirmed expectations create a state of dissonance or a psychological discomfort (Yi, 1990). According to this theory, the existence of dissonance produces pressures for its reduction, which could be achieved by adjusting the perceived disparity. This theory holds that "post exposure ratings are primarily a function of the expectation level because the task of recognizing disconfirmation is believed to be psychologically uncomfortable. Thus, consumers are posited to perceptually distort expectation-discrepant performance so as to coincide with their prior expectation level (Oliver, 1977). For instance, Cardozzo argues that consumers may raise their evaluations of those products when the cost of that product to the individual is high. For example, suppose that a customer goes into a restaurant, which she or he expects it to be good, and is confronted with an unappetizing meal.

The theory act on disparity that exists between product expectations and product performance, consumers may have a psychological tension and try to reduce it by changing their perception of the product (Yi, 1990). The consumer, who had driven a long distance and paid a high price for the meal, in order to reduce the dissonance, might say that the food was not really as bad as it appeared or she likes overcooked meal, etc.

Companies should strive to raise expectations substantially above the product performance in order to obtain a higher product evaluation (Yi, 1990). However, the validity of this assumption is questionable. Raising expectations substantially above the product performance and failing to meet these expectations may backfire, as small discrepancies may be largely discounted while large discrepancies may result in a very negative evaluation. This suggestion fails to take into account the concept of "tolerance level". The tolerance level suggests that purchasers are willing to accept a range of performance around a point estimate as long as the range could be reasonably expected.

The theory contributes to the understanding of the fact that expectations are not static in that they may change during a consumption experience. For instance, the importance attached to pre-holiday expectations may change during the holiday and a new set of expectations may be formed as a result of experiences during the holiday. This implies that as customer’s progress from one encounter to the next, say from hotel's reception to the room or the restaurant, their expectations about the room may be modified due to the performance of the previous encounter (Danaher & Arweiler, 1996).

2.2 The Concept of Customer Satisfaction

This is the customer fulfillment response that is judgment that a product or service itself is providing a pleasurable level of fulfillment. Inother words, one may view satisfaction as “the consumer’s fulfillment response” that is, a judgmentthat a product/service features or the product or service itself is providing a pleasurable level of fulfillment(Oliver, 2010). On the other hand, drawing on developments in the behavioral sciences, differinginterpretations of satisfaction have emerged in marketing research, which consider a range of favorableand unfavorable responses. Hence, over time, researchers have moved away from the literal meanings of satisfaction to focusing on consumer experiences (Oliver, 2010).

Customer satisfaction refers to post- consumption feelings or judgments about a product (Jamal& Naser2003). Good service quality leads to satisfying relationship with customers (Lassar, Manolis& Winsor,2000) and higher customer satisfaction results in better profits and word-of-mouth recommendation Beerli et al., (2004). Satisfaction is a response to a perceived discrepancy between prior expectations and perceived performance after consumption (Eid, 2011; Lau, Kwek, & Tan., 2011). Customer satisfaction is defined by how satisfied one is with the products/services. Thus, satisfaction is extremely important to marketers of products and services. This is because when a customer is satisfied, it will bring him/her to a positive purchase intention such as repurchase, positive word-of-mouth and loyalty in the long term. However, customer satisfaction plays a crucial role in sustaining in the marketplace (Garver & Gagnon, 2002); therefore, it is important to ensure that customers are satisfied. If not, retailers will lose their market.

Meanwhile, another research on online customer satisfaction states that advertisements, product quality, brand names, and prior shopping experiences play a significant role in customer satisfaction among online shoppers (Mumtaz et al., 2011). Earlier studies on service quality measures commonly take into account the entire purchase and even the after-purchase process (Muyllea et al., 2004; Kim et al., 2006; Bauer et al., 2006). According to (Villanueva et al., 2008) illustrates that acquisition of customer can be possible in two ways. By investing in marketing promotion companies can acquire customers but this way is costly.

On the other hand, a positive word-of-mouth communication can also attract customer in cheaper way. Prior research in the field of marketing has found support for the role of customer satisfaction (American Customer Satisfaction Index (ACSI) on firm economic performance, such as return on assets (ROA) and return on equity (ROE) (Anderson, Fornell, & Mazvancheryl 2004). If financial reports included information about the quality of customer relationships, there would be a much better understanding of the link between the firm’s current condition and its future capacity to generate shareholder wealth.” For example, customer satisfaction has been found to have a positive effect on a company’s relationship with its customers (Bolton, Lemon, and Verhoef 2004).

Furthermore, there is substantial evidence to suggest that the strength of a firm’s customer relationships is an important indicator of firm performance (Ambler et al., 2002; Bell et al., 2002; Berger et al., 2002; Hogan, Lemon& Rust 2004). The market orientation literature also finds that companies that have a stronger market orientation (Pralahad &Krishnan 1999) and view customers as a priority as part of the company culture exhibit superior performance. More specifically, research has found that customer satisfaction has a measurable impact on purchase intentions, customer retention, reduced customer defections, share of wallet (Cooil et al. 2007), and increased receptiveness to cross-selling efforts, reduced complaints, and word of mouth. These findings are bolstered by the research of Gruca &Rego (2005), which uses ACSI and COMPUSTAT data to find that satisfaction creates shareholder value by increasing future cash flow growth and reducing its variability.

2.3The Concept of Online Advertising

Advertising is defined as any paid form of non-personal communication of ideas and information about products in the media with the objective of creating brand image (Kotler & Armstrong, 2010). The emergence of technology has made online advertising the major channel of commercial communication around the world.

Advertising is an area which is changing with very fast pace because of the technology advancement and market dynamics. One model and its derivative is very popular in the modern advertising field. AIDA and Hierarchy of Effects model by Lavidge and Steiner, 1961, is accepted and even included in advertising practice by the industry (Rehman et al., 2014). AIDA and Hierarchy of effects model describes the purchase journey of the customer via advertisements through various media vehicles. AIDA has the elaboration as “Awareness, Interest, Desire and Action”. AIDA is a model for advertisers which they used first to make aware about the product and services to purchaser then develops the interest on the products and services then create the desire in purchaser to have the products and services and finally push to the purchaser to purchase the product or service (Rehman et al., 2014). Advertising drives sales by nudging propensity to buy the brand by the individuals who saw the commercials (Newstead et al., 2009). Many researchers feel that the effects of adverts are beyond sales and profits which are often much harder to measure (Joshi and Hanssens, 2010). One popular way to measure sale and profit is by comparing sales revenues with the advertising expenditure, which may also have termed as Return on Investment (ROI). Another way is based on lag models where the effect of advertising is measured in different intervals of time. Prime parameter could be sales results during that time intervals. Yet another is through experiments, for example to test the effects of different advertising expenditure levels. More complex experiments could be designed to include other variables, such as opting for different media for the same product and brand (Armstrong and Kotler, 2009).

Online advertising has now become an important part of marketing mix and a source of consumer information (Cheong and Morrison, 2008). However, web advertising does not simply advertise and distribute messages, it also facilitates the relationship with customers and cyber trademark creation, offers certain services to consumers, generates online sales, and sends marketing messages to specific customers. In addition, it promotes a highly-individualized service for a large number of consumers and a direct and interactive marketing. The main principle of media in the world, according to Rowley (2005); Burman & Söderberg (2007) is to connect and bring information to the audience. The online business has shown considerable growth and improvement over the last couple of years, which is dependent on the enhanced information technology and telecommunication. The increased use of the Internet and electronic commerce has had positive effects on the tourism sector, as described by Cooper et al., (2008). The online advertising business is growing fast and competition is fierce.

Online advertising is essential in this particular industry for companies to gain customers and therefore to make profit. Technology adoption and use has made online advertising the major channel of commercial communication around the world. The objective of advertising is to create awareness of a company, a brand, a website, or an event in order to stimulate sales and increase profits. For some time now television, radio, newspapers, and magazines have dominated the advertising media. Nowadays, online advertising is becoming the driving force in many advertising initiatives and efforts (Kotler & Armstrong, 2010).

The Internet consists of globally interconnected computer networks that offer companies inexpensive and convenient tools for advertising and communicating with their customers according to(Kaye & Medoff, 2001). Various types of online advertisements are available on the Internet according to Rodgers and Thorson (2000); online advertisements can be in the form of banner advertisements, pop-advertising, sponsorship, hyperlinks, and websites. Although online advertising is an effective tool to reach larger audiences, it is important that advertisers incorporate features to make it more effective. According to Tsang & Tse (2005), online advertising is effective if it is able to generate an immediate response from consumers. Three features are used in online advertising, based on models proposed by Escalas & Rutgers (2003). These are: Multimedia, Pictures, and Content.

Internet advertising market has grown rapidly during the last decade since the appearance of the first Internet advertisement in 1994 (Hollis, 2005). According to a recent report from the Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers (PwC), Internet advertising revenues for 2007 are estimated to grow to $21.1 billion, a 25 percent increase over the previous revenue record of nearly $16.9 billion for year 2006 (IAB 2008). Also, the Kelsey Group recently provided an estimate of $45 billion for Internet advertising globally, and predicted Internet advertisement revenues to reach $147 billion globally by 2012 (Pacheco, 2008). As more and more people spend time on the Internet, marketers believe that Internet advertising would be a goldmine. From the viewers’ perspective, Internet advertising can be considered a special kind of Internet services. It is one of the many ways to get to know in a relatively quick fashion many things being advertised. It is also a convenient and quick way of finding information we need about products, services, businesses, etc.

Lake (2002) stated that advertising promotes a product, service or event to its target audience. A target audience is the portion of the general public that products, services or events were created to fill a desire or need in the market place. The channels advertising is run through to reach its target audience includes internet, print media, broadcast, outdoor and point of purchase. Root (2004) examined that web adverts can be interactive and allow consumers to react instantly to the message by clicking on the link to visit the sponsor website or by agreeing to fill out an online survey to give their opinion.

Web advertising can be traced and tracked to find out exactly where responses are coming from and which kinds of websites are most effective for particular kinds of product or service. Geographically, internet advertisement can be seen by people all over the world for a relatively low cost. Also, one vital aspect is that it can offer international exposure without charging a premium. Anthony (2007) said advertising is one of the most important things present in a society today, like an old slogan puts it “advertising” your right to choose”. Advertising helps to keep the consumers informed about new products or services available in the market.

Hood (2005) argues that advertising images are responsible for part of the pleasure people take in making purchase. Hood asserts that advertising is an essential and valuable element of a free society. Adverts convey crucial information about the price, quality and availability of products. They save consumers time and energy. Dawson (2004) researched that when you stop advertising you lose sales. It will be difficult for people to know about your business and all its benefits if they don’t know what you have to offer. What good is a product if it is not known to the masses? Adverts make sales consistent and competitive. Adverts reveal the key to gaining and retaining customers.

Pinkus (2008) stated that profits are made when product are sold. Advertising is a marketing strategy that helps draw the attention of possible buyers toward the product. However, if the advertisement is made to add to the sales and therefore the consequent profits of a venture, then regardless of the quality of the advertisement, it fails in its aim. Advertising obviously makes businesses have competitive advantages over others that trim their marketing budgets.

Advertising is a way to spread the word about services available to a target customer base long-term value, short term advertising generates new sales, which leads to repeat business from existing customers and create new leads that turn into future sales. The more familiar buyers are with a business or brand, the more likely they are to purchase that brand. If a business is not communicating with customers, then that company will not be considered in the buying decision.

Newcomb (2004) studied that advertising is an important driver of corporate success. In fact, 72% think advertising and marketing can have a substantial influence over the way the market perceives their company; while 62% feel their advertising and marketing programs have substantial impact on sales. But when it comes to effectiveness, the respondents were split- about 42% felt that “the advertising industry seems to have a poor grasp of the business issues confronting organization like mine” while just under 40% think external advertising and marketing services bring a valuable perspective to our advertising and marketing issues.

Brady et al., (2004) said the position that intrinsic brand cues are more important for highly intangible service purchases (natural funds) than for purchases that are more tangible (hotels and computers). The result reveals that extrinsic brand cues are less important in purchase decisions of highly intangible service. Marcedo (2008) examined that advertising is a technique that is sophisticated, thus appealing to people more easily. Adverts, however, make people anxious to get more and more things to buy. People always want more and consume more than they need.

Advertising makes known the existence of a product or service to the market. Therefore, it may stimulate the economy, creating new jobs, this, being a good source of income for companies, families and countries. Moreover, it is a good way of entertaining people and increase peoples’ creativities. A popular culture media (2004) studied that advertising is the promotion of a product or service and is extremely pervasive in contemporary society. Its maximize sales. Advertising helps to spread awareness about products or services that are of some use to consumer and potential buyers. The main aim of advertising is to sell. Advertising on the whole helps business as well as the economy to prosper and makes the consumer aware of the various choices that are available to him. Advertising worldwide, contribute to economic growth. Most organization, small and large uses advertising to help meet marketing objective.

2.3.1 The Relationship Between Multimedia Advertisements on Customer Satisfaction

Multimedia advertising is a form of expression describing elements of online content such as audio, video, and animation (Rosenkrans, 2007). According to Yoo, Kim, and Sout et al., 2004), animation is one of the innovative features that improve the design and interactivity of online advertisements, particularly banner advertisements. Animation incorporates moving images and graphics to enhance the presentation of the content. It includes several technological developments involving plug-ins, JAVA script, Flash, and streaming media (Yoo et al., 2004). Tsang & Tse (2005) found that consumers respond favorably to animated colors, text, and graphics on websites. Companies, therefore, develop digital video advertisements to increase consumer involvement with their brands. Digital video can be in the form of streaming video, gaming, or music video (Rosenkrans, 2009). Glass (2007) suggested that consumers who are engaged in video games are more likely to develop favourable responses to in-game brands. This finding was supported by Wise et al., (2008), who found that companies that build thematic connections between the game and the product’s brand would invoke a positive influence on consumer attitude toward the brand.

In one of the early studies of banner advertisement effects found that even without click-through, banner advertisements resulted in heightened awareness, brand perceptions and attitudinal shifts for brands. The significance of animation and location of banner advertisement with the eye tracking technology studies revealed that animation was not important to attract viewer’s attention (Josephson 2005; Sundar, Kalyanaraman 2004). But the location plays a significant role and banner advertisements at the top of the webpage were more often viewed (Sundar, 2004).

2.3.2 The Relationship Between Pictures Advertisement on Customer Satisfaction

Pictures advertising can be defined as images that make online advertisements appear more attractive to consumers (Taylor et al., 2008). Picture advertising is a feature of online advertising that can be used to attract customers and bring about customer satisfaction. If the advert is based on images, then relevant features are colors and those mentioned in advertisement standards, like shape and size; see (Internet Advertising Bureau UK, 2008)

Consumers are more attracted when advertisements are easily understood without involving text Kumar (2008). Celebrities’ pictures can promote products or services and generate positive responses from consumers (Quester et al., 2007). The major drawback of incorporating pictures in online advertising is the time it takes to download them. Research has shown that the average person spends about 30 seconds on a webpage before clicking onto another site; hence, pictures that take more than 15 seconds to download may not reach their audience (Adam, 2003).

Picture features in advertisement attempts to create a favourable mental image of a product or firm in mind of consumers. This image aims to associate the advertised product and/or firm with certain lifestyles or values. Ads now have to get their point across quickly through something that is pleasing as well as amusing to the eye. Aesthetically creative ads will get a prospective customer engaged in whatever is selling. In our society, we are bombarded everyday with ads for everything under the sun, on average we see 3,000 ads daily. Because of this we subconsciously ignore them unless we see something we really like, Priya et al., (2009).

Simplistic image gives off just enough to tell the consumer what the deal is with the product. What matters most is how the consumer feels, not what they think. If they feel good about your brand you’ve done a good job. The image needs to appeal to your audience as much as possible and avoid offending them. Effective advertisements are advertisements that help the advertiser to reach its goals. Ramalingam et al., (2006) measured the effectiveness of TV broadcast advertisements (toothpaste) by discovering important factors that influence the advertisement effectiveness by using artificial neural network (ANN).

In this study the effects of each of these factors has been studied and it is used for measuring the advertisement effectiveness. They examined 13 factors for evaluating the effectiveness of advertisement. Experimental results show that advertiser must take attention to these 13 factors in their advertisement. They found there is a meaningful relationship between the effectiveness of advertisement and these factors. Also, their study shows that the ANN model achieves 99% accuracy for measuring the advertisement effectiveness.

When consumers buy products, there are number of factors that influence them and affect the decision of purchasing the product. Among them is celebrity attachment. Now it depends upon the celebrity effectiveness, attachment and match-up with the product. Well, results show good and positive results of the celebrity attachment towards the advertisement and with the brand. A high effect was found for purchase intention when a celebrity comes up in a TV advertisement and endorses a particular product. Both number of endorsements and celebrity attachment influence the buying behaviour of consumers. When consumers have strong attachment with celebrity and see that he/she is endorsing numerous brands then it negatively affects the purchase intent. And when they have weak connection their purchase objective is increased with various endorsements (Jasmina, & Webster, 2011).

2.3.3 The relationship between content advertisements on customer satisfaction

Content Advertisers focusing on providing consumers with written information about products and services and thus it can fail to attract a large amount of consumer response rate according to (Armstrong 2001). Content is feature of online advertising and according to Adam (2003) he found that advertisers focus on delivering concise messages on banners in order to draw favourable consumer responses. Online advertising that focuses on content generally uses simple, static text because it loads faster than pictures and multimedia files (Moses, 2009).

The hotel industry is accepting the use of the web for electronic commerce, and many hotels have already established web sites to bring information about their products to the customers, to promote their services and products all over the world, in a direct, cost minimizing and time effective way, and eventually gain a share of online market (Liang and Law, 2003). However, adopting the online advertisement is neither a guarantee of success to any company nor a competitive advantage (Wan, 2000). Web sites have to be well designed and easy to navigate in order to provide hotels with an inexpensive and effective platform for marketing and advertising, which potentially increase their competitiveness in the market space (Baloglu & Pekcan, 2005).

Content refers to the information features or services that are offered in the web site (Huizingh, 2000) and is not limited to the subject, product or services provided. Rather, content includes the solutions and strategies employed to make it easy for the user to accomplish important tasks, such as information retrieval, search and navigation required in making a purchase, and obtaining feedback. Web sites will have also to offer reservation facilities and value-added services in order to attract customers to the electronic marketplace (Calogne, 2001). Another important service of the virtual market space is richness (Sigala, 2003). Richness refers to the ability of media to improve human understanding by reducing uncertainty and ambiguity (Lodhia, 2004). As buyers have more product/service information, transactions’ transparency amongst prices and vendors increase so rich media need to be used with web sites in order to provide as much information as possible (Sigala, 2003).

Previous studies have measured and evaluated the quantity of offered information through hotel web sites by studying and recording extensive survey data from the hotel websites and studying the attitudes of agents or specialists who are involved in the hotel industry. The identification of information practices on the hotels web sites is done by presuming the existence of specific dimensions, i.e. sets of information services on the web sites grouped together according to their similarity, in order to summarize relative information services (Chung &Law, 2003; Vrana et al., 2004). For example, Google focuses on content by using plain html format to maintain the basic ethos of its sites (Kotler & Armstrong, 2010). The company has managed to attract a wide range of consumers who perceive the published content as concise and accurate (Adam, 2003). Online Publishers Association (2008) found that 66% of online consumers do remember advertised messages on content websites and are likely to develop brand favourability and purchase intention. Nevertheless, it has been found that companies that focus solely on content may attract a smaller number of potential customers (Armstrong, 2001).

Similar to banner elements, the website type relates to user involvement. Based on motives to use the web, web users search a website, scrutinizing core information to achieve search satisfaction or surf a website in an experiential mode, skimming core and peripheral information (Muylle et al., 2001). Consumers form attitudes toward traditional means of advertising such as television and magazine. Such attitudes will then influence their attitude toward the brand; exposure to advertisement induces feelings and judgments from the consumer. Feelings are the affective components, and judgments are the cognitive components of consumer attitude. Consumers form feelings (happy, annoyed, or amused) and judgment (informative or factual) when they are exposed to advertisements.

Perceptions formed from feelings and judgments will influence consumers’ attitude toward online advertisements. For example, consumers’ attitude toward the advertisement is ‘favorable’ when they read/click/play it or ‘unfavorable’ when they ignore it (Escalas and Rutgers, 2003). These variables manifest the dimensions mentioned in the literature; i.e., Multimedia, Pictures, and Content features.

2.3.4Advertising and Customer satisfaction

Keller and Lehmann (2003) propose that the value of a brand ultimately resides with customers. Thus, it is essential to model customer attitudes when attempting to analyze, and more importantly, understand, the impact of a marketing action on firm value. Attitudes are “sticky” measures and are indicative of future firm performance. They become “more ‘top of mind’ or accessible, persistent, resistant to change, and likely to guide intentions and subsequent behavior,” as the consumer gains more and more experience with the brand (Johnson et al. 2006).

There is conflicting evidence on whether advertising has a positive impact on market value. Studying PC manufacturers and the sporting goods industry, Joshi and Hanssens (2010) find that advertising indeed has a positive effect on market value. In a broader study, however, Wang et al., (2009) find that in 10 out of 32 industries, advertising has a significant negative effect on market value. The firms for which these negative outcomes were found tended to be service providers, including eating places and retail establishments. Still, if advertising increases sales and generates goodwill, then why doesn’t advertising always translate to increases in firm value? Wang et al. (2009) speculate that one factor might be over-advertising, and research indicates that many firms indeed greatly over-advertise (Prasad and Sen 1999). This over-advertising thesis is compatible with behavioral research which suggests that if consumers view advertising as excessive, it will have a negative impact on their attitudes toward the brand. Moreover, not only may firms be ineffective, they may also be inefficient. Luo and Donthu (2005) establish that even among top marketers, a great deal of advertising inefficiency exists. They found that about 20% of advertising spending among firms in their study was in vain due to inefficiency, resulting in missed opportunities as well as wasted resources.

Tracking how a firm’s marketing expenditures influence customers’ attitudes and subsequent behavior can help in evaluating marketing’s contribution to shareholder value (Rust et al. 2004). Gupta and Zeithaml (2006) and the Marketing Science Institute (2006) call for research that complements observed measures with attitudinal constructs. Customer satisfaction is regarded as one of the ultimate attitudinal constructs (Morgan and Rego 2006) whose antecedents are related to advertising (Mehta et al. 2008) and whose consequences feed into market value (Fornell et al., 2006). None has looked into effect of online advertising features on customer satisfaction.

Using data from the airline industry accompanied by ACSI scores, Grewal et al.

(2010) show that advertising has a positive effect on customer satisfaction. Still, it is not clear how this process comes about and whether it generalizes to other industries. Advertising can affect customer satisfaction by framing the consumption experience and by sending the consumer credible signals of product quality and value. According to Mehta et al. (2008), the effects of advertising can be classified as informative, persuasive, or transformative. Informative advertising raises awareness of the product and its attributes, and can therefore increase knowledge of brand quality (Mehta et al. 2008).

Persuasive advertising seeks to “change some pre-behavioral mental state”, and in doing so can increase customer utility and expectations of the brand. The mere act of advertising may further enhance customer expectations by serving as a signal to the consumer of a firm’s investment and commitment to the product. Consumers may also employ their impressions of advertising costs as cues of product quality which will have a positive effect on customer satisfaction. Empirically, previous studies have found that advertising may decrease price elasticity by differentiating the product and thereby increasing perceived value (Draganska and Klapper 2010). This has a positive effect on customer satisfaction.

Competitive advantage (CA) has been characterized contrastingly by diverse authors but all of them agree that it relates to strategy formulation and implementation in organizations (Porter, 2009). Hotels that desire to perform must select strategies that will give them a SCP advantage over their competitors based on their core competencies (Porter, 2004). David (2005) is of the view that core competencies of hospitality organizations include processes, skills and assets that influence organizations to achieve SCP. Sources that have also been mentioned to contribute to core competencies are location, brand, facilities, employee, customer loyalties, market coverage, market share, service quality, technology, leadership, systems and procedures and organizational culture.

Hotels are dynamic organizations which are affected by diverse variables hence the application of SCP will help them to sustain exemplary performance. (Richard and Marilyn, 2006) argue that the essence of business strategy formulation is coping with competition. Moullin, (2007) also suggest that business strategy is all about competitiveness because the main purpose of strategy adoption is to enable hotels to gain a sustainable edge over its competitors (Tavitiyaman et al., 2011) state that the hotel's methodologies comprise of aggressive moves and business approaches that chiefs utilize to draw in and please clients, contend effectively, develop the business, conduct operations and accomplish focused on objectives.

A hotel achieves SCA when an attractive number of customers prefer its services over the offerings of competitors and when the basis of this preference is durable (Sabah et. al., 2012). Businesses will only result in SCP when the appropriate strategic management drivers of performance are adopted. The management of these key success factors results in superior value. Hotels can take advantage of their overall products and services to come up with services which are superior to their competitors. Porters’ Generic Strategies can create competitive advantage for a firm through the adoption of differentiation and cost-leadership. These strategies give a firm a better chance of outperforming other firms in a homogeneous industry.

Differentiation can take different forms such as various marketing strategies, better product image, better market awareness, low prices, higher product quality and better customer service or availability of goods. Differentiation helps firms to build customer loyalty through offering unique products or services thus helping firms to perform better than others (Allen and Helms, 2006) Firms that adopt differentiation can charge higher prices based on their costs, channels of distribution and quality or they can choose to differentiate themselves in any other area of their distinctive competencies.

Differentiation strategies can be classified into market and product strategies. In product-innovation, firms outperform their competitors by increased creativity, quality, efficiency and innovations among others (Akan et. al., 2006). Marketing differentiation involves the use of marketing practices for hotels to differentiate themselves which include market segmentation, branding, promotions, pricing and advertising. A hotel can gain competitive advantage by adopting a low-cost strategy such as mass production, technology adoption, achieving economies of scale and access to raw materials. A cost-leadership strategy can improve the performance of hotels by giving them distinctive competencies in the management of materials and also in the production process.

2.4 Conceptual Framework

The study aimed at establishing effects of online advertising features on customer satisfaction in selected five-star hotels in Nairobi County. The independent variables were; multimedia advertisement, pictures advertisement, and content advertisement. The dependent variable was customer satisfaction. Figure 2.2 illustrates the interaction of dependent and independent variables.

Independent variables Dependent variable

Multimedia advertisement Short video Animation Audio Pictures advertisement Attractive images Captivating Picture Content advertisement Informative knowledge Persuasive Consumer Satisfaction Customer loyalty Repurchase intention Referrals Ho1 Ho2 Ho3

Figure 2.2: Conceptual Framework on online advertisement features on customer Satisfaction

Source: Modified from Escalas& Rutgers, (2003)

The conceptual framework depicts independent and dependent variables. The independent variable has been operationalized toMultimedia, Pictures, and Content while dependent variable on the other hand is depicted by Customer satisfaction.

CHAPTER THREE

RESEARCH METHODOLOGY

3.0 Introduction

This chapter exhibits a portrayal of the methodology that was used in the investigation. It illuminates the systems and techniques for testing, information collection, dispensation, analysis, reliability and validity of research instruments, variables, the Statistical estimation model, assumptions of the model and analysis of variance, data processing analysis, assumptions of the study and ethical consideration of the research study, limitations of the survey and the area in which the study was carried out.

3.1 Study Area

The studywas conducted in Nairobi, Kenya’s capital city between the month of July and September 2015.The city and its surrounding areas form Nairobi County. Nairobi covers an area of 692km2 at about 1,661m above sea level. It has a population of approximately 3,183,295 (Kenya National census, 2009). The larger part of Nairobi’s economy is driven by all sorts of business activities for the international, private and public sector, and tourism activities.

Tours through the Nairobi city can be organized for visitors. These voyages through focal Nairobi as a rule incorporate visits to the Parliament Building, the City Market, and the National Museum;Trips to Nairobi National Park, Karen Blixen Museum, and the Giraffe Centre. For the most part, the city offers a very much created foundation, superb inns, and fine food. It also hosts numerous international conferences, conventions, and meetings. It has a very wide range of accommodation to suit budgets of different clientele, their tastes and preferences (KNBS, 2015).

The city is endowed with top rated high-class hotels ranging from (1) to (5) star luxury hotels which are competing against each other. Cheruiyot et al., (2012) noted that these classified hotels are trend setters in the tourism and hospitality industry. Also, Lo,et al. (2010) posits that high classified hotels distinguish themselves by offering superior products and customised services. The mentioned reasons provided a good setup to conduct this research study.

3.2 Research Design

The research adopted an explanatory research which is used to clarify the components of the factors and in the meantime, examine the reason impact relationship between factors (Malhotra and Birks 2003). Explanatory design is used mostly in studies with hypothesis testing. According to Saunderset et al., (2011) studies that establish causal relationship between variables use explanatory research design.

3.3 Target Population

The population targeted comprised of the customers of the selected five-star hotels in Nairobi County. The total number of hotel customers from which the sample wasderived was2500 customers drawn from 15five-star hotels.

Table 3.1 Sampling frame showing the Target Population

Hotels	Total Customers
Sankara Nairobi	156
Laico regency hotel	196
Villa Rosa Kempinski	200
Fairmont The Norfolk	170
Nairobi Serena Hotel	183
The Sarova Stanley	217
InterContinental Nairobi	371
dusitD2 Nairobi	101
The Boma Nairobi	148
Panari Hotel	135
Hemingways Nairobi	45
Windsor hotel and country Club	130
Nairobi safari club	146
Hotel Royal Orchid Azure	165
Tribe hotel	137
Total	2500

Source: Hotel Websites (2015)

3.4Sampling Design and sample size

Procedureof Sampling is the practice of deriving a representative from a given population. This is done with a profound appreciation of the characteristics of the population including size, distribution and other features that distinguish the elements in the population to ensure all aspects of a population are captured in the selected sample. Purposive samplingwasundertaken to select customers who had done online booking.The customers wereselected proportionately by simple random sampling based on the number of customers in each selected hotel.

3.4.1 Sample Distribution

Samples were drawn from the target population of 2500 customers of the 15 selected five-star hotels. The sample size was statistically obtained from the total population by adjusting to round off decimals to one person. From the population target of 2500, Taro Yamane (1973) selection of a sample size was derived from sample size formula of 345customers as shown below

Where:

This study allowed the error of sampling on 0.05. Thus, sample size was as follows:

n = (N) / (1+Ne2)

= 2500/ (1+2500*0.0025)

= 345

N = Number of Total Population

n = Number of Sample Size

e = Sampling Error (designating to be at the 0.05 significant level)

*Confidence level is 95% or 0.05 level of significant is chosen for this study

Hence, the sample size was 345respondents in Nairobi County, Kenya. According to Kasomo, (2006) a sample contains characteristics present in the target population and have independent chances of being selected. To distribute the random sample to all categories of hotels, a sample fraction (f) was calculated to give the probability of any categories of hotels being selected for the sample. The sample fraction (f) was defined by the equation f=random sample/N*n, that is, the study sampling frame is as shown in Table 3.2

Table 3.2: Sample size determination/distribution

Hotel	Hotel customers	Sample size
Sankara Nairobi	156	22
Laico regency hotel	196	27
Villa Rosa Kempinski	200	28
Fairmont The Norfolk	170	23
Nairobi Serena Hotel	183	25
The Sarova Stanley	217	30
InterContinental Nairobi	371	51
DusitD2 Nairobi	101	14
The Boma Nairobi	148	20
Panari Hotel	135	19
Hemmingway’s Nairobi	45	6
Windsor hotel and country Club	130	18
Nairobi safari club	146	20
Hotel Royal Orchid Azure	165	23
Tribe hotel	137	19
Total	2500	345

Source: Hotel Websites (2015)

3.5 Data collection Instruments and Procedure

This section details the sources of the data and the data collection methods employed.
3.5.1 Data Sources

Both primary and secondary data sources were employed in the study. Primary data was collected by distributing questionnaires to customers in the selected establishments and secondary data included books, journals, documents, publications and the internet.

3.5.2 Data Collection instrument

The questionnaire was the primary instrument for information gathering. A structured questionnaire (Appendix 2) including 20 questions is composed and controlled to distinguish hotels in Nairobi, Kenya by the researcher. The questionnaire purpose was to investigate the effect of online advertising features on customer satisfaction in selected five-star hotels in Nairobi County.The questionnairewere made short and clear with a specific end goal to guarantee that it takes the respondents not over 5 minutes to answer and along these lines energize cooperation.Thequestionnaire includedan introduction part which was to brief the respondentsand to persuade them into taking part in the exercise.

3.5.3 Data Collection procedure

An introductory letter was obtained from the school of Business and Economics, Moi University. The letter was used to seek permission from the management in the selected hotels. Questionnaires were handed to the hotel managers who identified customers to fill the questionnaires during their free time. The questionnaires were divided into three sections, section A was on demographic information, section B was on customer satisfaction and section C was on online advertisement featuresPrior consent was obtained from the selected customers prior to data collection. The questionnaires were collected after two days; this was done to give the respondents ample time to fill in the questionnaires. The questionnaires were left under the care of the managers after filling them.

3.6 Measurement of variables

The study had four variables, three independent variablesand one dependent variable.

3.6.1 Dependent variable

The measures were all based on literature and in some case modified to reflect the current context of the research.For this investigation questionnaire was utilized to gather information. The questionnaire was structured using the Likert scale format with a five-point response scale. In this Likert scale type of questionnaires, the respondents were given five responses choices.

The scale items for assessing customer contentment were adjusted from approved measures radiating from earlier studies(Zeng et al., 2009).ACSI says their scores are a leading indicator of future "High satisfaction scores. The respondents were requested to indicate the extent to whichthey agree or disagree, based on customer satisfaction, by checking theappropriate response to the questionnaire items regarding the key constructs of thestudy. For each item of customer satisfaction, five-point Likert scales strongly disagree, disagree, neutralagree and strongly agree, were utilised. The study will be measured using 5 items.

3.6.2 Independent variable

Components of web based promoting involve Multimedia, Content and Pictures where Multimedia(short video, animation and audio)Likert scale was used, adapted from (Yooet al., 2004) combine with Wise et al.,2008) andonline publishers’ association (2008). Secondly, Pictures (attractive images, captivating pictures, brand image)was measured using a Likert scale adapted (Taylor et al.,2008), Kumar (2008) combine with(Quester et al.,2007).Thirdly content(informative knowledge, persuasive) usinga Likert scale to measure, adapted from Adam (2003) Likert scale varying from 1= strongly disagree to 5 = strongly agree). The study was measured using 15 items.

3.7 Validity and Reliability

Validity is the degree to which results obtained from analysis of data actually represent the phenomenon under study (Mugenda and Mugenda, 1999).To ascertain the validity of the instrument, both content and face validity were determined by presenting the instruments to the supervisors and their advice was used to modify the instrument.

Reliability is a measure of how much a research instrument yields consistent results after repeated trials. Reliability has to do with the accuracy and precision of a measurement procedure.It was measured using the Cronbach’s Alpha at a level of 0.7%. in the opinion of Hair e tal., (2005) the generally agreed upon lower limit for Cronbach's Alpha is =>0.70 but may decrease to =>0.60 in explanatory research and increase up to ≥0.80 in studies that require more stringent reliability.

3.8 Pre-testing

According to Mugenda & Mugenda (1999), the purpose of pre-testing the instrument is to ensure that items in the instrument are stated clearly within the stated objective and meaning to the respondents. The respondents on which the instrument is pre-tested should not be part of the selected sample. It is during pre-testing of the instrument that the researcher can assess the clarity of the instrument and the ease of use of the instrument. The researcher is also able to assess the time taken to administer the instrument. It is also during pre-testing that the researcher will be able to identify sensitive and annoying items. Items identified as sensitive, confusing, or biased in any way will be modified and omitted.

The researcher pre-tested the questionnaires with 20 respondents in Hilton hotel in Nairobi County, Kenya. These respondents were not included in the actual study.

Cronbach's alpha was ascertained for the pre-testedstudy, and the outcomes were; 0.736 for customer satisfaction, 0.819 for multimedia advertising,0.709 for picture advertising, and 0.724 for content advertising. The outcomes demonstrate that the instrument was reliable.

Instrument was reliable.

Table 3.3	Reliability Test

Cronbach's Alpha	N of Items
Customer Satisfaction	0.736	7
Multimedia advertising	0.819	3
Picture Advertising	0.709	5
Content Online Advertising	0.724	4

Source: (Research data, 2015)

3.9 Data Analysis

After data collection, the data was cleaned, coded and entered into the computer and analysed with the aid of Statistical Package for Social Sciences (SPSS) version 21.0.Descriptive statistics and inferential statistics were used. Descriptive statistics included; mean, standard deviation, frequencies and percentages and their purpose was to enable the researcher to describe the distributions of scores and measurements using a few statistics. Multiple regression was conducted to check the effects of each independent variable (Multimedia, Picture and Content features) against the dependent variable customer satisfaction.

Multiple regression modelwasused to establish the multiple regression coefficients of correlation between extents of online advertising features and Customer Satisfaction. The multiple linear regression models are shown below;

Y=β0+β1X1+β2X2+β3X3+ε…………………………………. (i)

Customer Satisfaction

Y-intercept

X1	Multimedia

X2	Pictures

X3	Content

β1-β3Coefficient regression or change induced in by each

Error term

3.10 Ethical Consideration

This research ensured that any references made are attributed to the actual author by indicating the name of the author, and the year his/her work was published. Detailed information of any reference was indicated under bibliography at the appendixes. The study also ensured that the information collected from the field was confidential and that where necessary, anonymity of the respondent was ensured. The researcher while conducting the studyexplainedthe real purpose of the research to the respondents in the introductory letter as well as communicating the same to the respondents during the data collection. The researcher made sure that the quality of the research was not compromised and its results were open to academic and public.

CHAPTER FOUR

DATA ANALYSIS, PRESENTATION AND INTERPRETATION

4.1 Introduction

This chapter deals with data analysis and presentation. The data obtained was coded and presented in the form of tables, all questions other than those from part A of the questionnaire dealing with demographic information were closed-ended making questions easy to summarize. The open-ended questions served to complement the closed ended questions. Three hundred and forty-five questionnaires were administered by the researcher assisted by two research assistants during the period of data collection, since it was a fill-and-return at the, various hotels all the questionnaires were filled by the respondents and handed back.

4.2 Respond Rate

Out of 345 questionnaires distributed to the respondents, only 231 questionnaires were completed accurately and were used for analysis which gives a response rate of 67.0 % which was good compared to the recommended response rates to verify consistency of measurements required for analysis which should be over 50% (Kothari, 2005).

4.3 Demographic Information

This section analyses demographic data of the selected respondents. It helps build a profile of the respondents in respect to gender, age bracket and marital status. Findings revealed that males tend to sleep in hotels than females by 58.4% with females 41.6% with majority of males and females subscribing to these hotels range from age between 31 to 50 years, representing 70% of the respondents. The study findings are presented in tables 4.1.

Table 4.1 Demographic Information for Respondent

Gender	Frequency	Percent
Male	135	58.4
Female	96	41.6
Age bracket	Frequency	Percent
18-30 years	51	22
31-50 years	111	48
Above 50 Years	69	30
Marital Status	Frequency	Percent
Single	197	85
Married	34	15
Total	231	100.0

Source: (Research data, 2015)

4.4 Descriptive Information on Customer Satisfaction

The study sought to find information on customer satisfaction. The respondents were presented with questions rated on Liker scale (strongly agree = 5, agree = 4, neither 3, disagree = 2, and strongly disagree = 1). In the interpretation of the findings, a mean (M) of above 2.5 indicate that majority of the respondents agreed with the statement presented, while a mean (M) of below 2.5 indicate that most of the respondents disagree with the statements presented. The response was analysed descriptively using mean and standard deviation. The responses are presented in table 4.2.

Table 4.2 Mean Standard Deviation for Customer Satisfaction

Mean (M)	Std. Deviation (SD)
The hotel service is better than my expectation	3.94	.742
I will come back again to stay at the hotel	4.23	.925
I would recommend the hotel to those who seek my advice	3.93	1.001
The hotel has good first and last impression	4.37	.573
Overall, I am satisfied with online based advertising	3.90	.968
Overall mean	4.10	0.84

Source: (Research data, 2015)

The findings revealed that most of the respondents were in agreement with the statements rating customer satisfactions. On the statement that the hotel service is better than my expectation M (3.94) and SD (0.742), I will come back again to stay at the hotel M (4.23), and SD (0.925), I would recommend the hotel to those who seek my advice M (3.93) and SD (1.001). The hotel has good first and last impression M (4.37) and SD (0.573); overall, I am satisfied with online based advertising M (3.90) and SD (0.968). The average mean was (4.10) with SD of 0.84, this indicates that most respondents agreed with the statements on customer satisfaction. This implies that the customers were satisfied with the services offered by the selected hotels.

4.5 Descriptive Analysis on Multimedia in Online Advertising

The study sought to determine the effect of multimedia in online adverting on customer satisfaction and included the following items in the questionnaire.

Table 4.3: Mean and Standard Deviation for Multimedia in Online Advertising

Mean	Std. Deviation
Videos on websites improves the interactivity of online advertisements with the consumer	4.19	.962
Multimedia features improves the customer involvement with their brands	4.34	.865
Animation enhances the presentation of the content	3.93	1.001
I respond favourably to animated colours/text and graphics on websites	4.27	0.714
Multimedia feature that build thematic connections with the brand invokes a positive influence on consumer attitude	4.18	0.046
Overall mean	4.17	0.94

Source: (Researchdata, 2015)

The following statement was put across, videos on websites improves the interactivity of online advertisements with the consumer had a mean of M (4.19), and SD (0.962) which implied that most of the respondent agreed with the statement, Multimedia features improves the customer involvement with their brands M (4.34) and SD (0.865). Animation enhances the presentation of the content M (3.93) and SD (1.001). I respond favourably to animated colours, texts and graphics on websites M (4.27) and SD (0.714).Multimedia features that build thematic connections with the brand invoke a positive influence on consumer attitude M (4.18) and SD (0.046). The findings indicate that most of the respondent agreed with the statement since the overall mean was 4.17.as indicated in table 4.3.

From the findings, it was deduced that multimedia online advertisement improves customers’ satisfactions since; videos in the websites improves the interactivity of online advertisement, it improves customer involvement with the brand, alsoanimation enhances the presentation of the contents.

4.6 Descriptive Analysis on Picture in Online Advertising

The study sought to determine the effect of picture in online advertisingon customer satisfaction and included the following items in the questionnaire.

Table 4.4 Mean Standard Deviation on Picture in Online Advertising

Mean(M)	Std. Deviation (SD)
Images make online advertisements appear more attractive	4.37	.573
Pictures that are easily understood stimulate consumers to learn more about the product	4.34	.523
Pictures in online advertisements will persuade consumers to click on the advertisement.	4.37	.693
Image features like colours, shape &size create a positive feeling towards the products or service	4.29	.588
Pictures help generate favourable consumer response to the brand of the product or service	4.31	.765
Overall mean	4.33	0.63

Source: (Research data, 2015)

The following statement was put across, Images make online advertisements appear more attractive, the respondents generally agreed to the statements with M (4.37) and above and standard deviations SD (0.573). Item two stated: Pictures that are easily understood stimulate consumers to learn more about the product M (4.34) and SD (0.523). Pictures in online advertisements will persuade consumers to click on the advertisement M (4.37) and SD (0.693).Image features like colours, shape &size create a positive feeling towards the products or service M (4.29) and SD (0.588). Pictures help generate favourable consumer response to the brand of the product or service M (4.31) and SD (0.765). The overall mean for the statements on use of picture in online advertisement was 4.33. this indicate that; images make online advertisement appear more attractive, pictures are easily understood by potential customers and stimulate the consumers to learn more about the product, it also persuades consumers to click on advertisement. The findings further indicate that, images features like colours, shape and size creates a positive feeling towards the product or service, it also help generate favourable consumer response to the brand of product or service.

4.7 Descriptive Analysis of Content Online Advertising

The study sought to determine the effect of content in online advertising on customer satisfaction. The following statement was put across;

Table 4.5 Mean Standard Deviation for Content in Online Advertising

Mean	Std. Deviation
Easy to understand information in advertisements interests the customer	4.56	.543
Transparent information in advertisements develops brand favourability	4.43	.633
I am drawn towards adverts that have informative knowledge	4.36	.645
concise messages on advertisements draw favourable consumer response	4.42	.620
Persuasive information will stimulate consumers to learn more of the product or service	4.12	0.81
Overall mean	4.38	0.650

Source: (Research data, 2015)

On statement that it is easy to understand information in advertisements interests the customer the respondents generally agreed to the statements with M (4.56) and standard deviations SD (0.54) as indicated. Transparent information in advertisements develops brand favourability M (4.43) and SD (0.633). I am drawn towards adverts that have informative knowledge M (4.36) and SD (0.64). Concise messages on advertisements draw favourable consumer response M (4.42) and SD (0.620). Persuasive information will stimulate consumers to learn more about the product or service M (4.12) and SD (0.81). The overall mean for the responses was 4.38. This implies that; it is easy to understand information in advertisements,transparent information in advertisements develops brand favourability, customers are drawn towards adverts that have informative knowledge, and that concise messages on advertisements draw favourable consumer response.

4.8 Factor Analysis

Factor analysis was used to identify underlying variables, or factors, that explain the pattern of correlations within a set of observed variables. Factor analysis is often used in data reduction to identify a small number of factors that explain most of the variance observed in a much larger number of manifest variables. According to Lu et al. (2007) factor analysis seeks sets of factors that can account for all common or unique variances in a given set of variables. Any item that fails to meet the minimum criteria of having a factor loading value of 0.5 is rejected.It enabled to identify separate dimensions and further permits understanding as to what extent the construct is explained by each dimension Hair et al., (2006). The analysis was conducted to each and every individual latent construct. The KMO value measures the sampling adequacy and the interpretive adjectives for the Kaiser-Meyer-Olkin Measure of Sampling Adequacy are: in the 0.90 as marvelous, in the 0.80's as meritorious, in the 0.70's as middling, in the 0.60's as mediocre, in the 0.50's as miserable, and below 0.50 as undesirable. All the values for the variables considered in this study met the minimum factor loading value ofabove 0.5 hence none of the variables was rejected.

4.8.1 Multi-media Factor Analysis Results

The factor analysis results of multimedia advertisement, indicated that the KMO was 0.731 and the Bartlett’s Test of sphericity was significant (p<.05). The Varimax rotated principle component resulted in one factor loading. Multimedia advertisement variable explained 59.301 % of variance with Eigen values larger than 1, as indicated in table 4.6.

Table 4.6: Multi-media factor analysis

Component
1
Videos on websites improves the interactivity of online advertisements with the consumer	.812
I respond favourably to animated colours, text and graphics on websites	.734
Multimedia features improves the customer involvement with their brands	.828
Animation features improves the design and interactivity of online advertisement	.722
Animation enhances the presentation of the content	.749
KMO = .731; Bartlett's Test of Sphericity = .000 Eigen value = 1.00 Percentage of variance Explained = 59.301

Extraction Method: Principal Component Analysis.

1 component extracted.

4.8.2 Picture Advertisement Factor Analysis Results

The picture advertisement factor analysis results had KMO of 0.747 and a significant (p<.05) Bartlett’s Test of Sphericity. The varimax rotated principle component applied resulted in two factors loading that explained 58.941 % of the variance. All the statements conformed to the set limit of 0.5, as indicated in table 4.7.

Table 4.7: Picture advertisement factor analysis

Component
1	2
Images make online advertisements appear more attractive	.597
Pictures that are easily understood stimulate consumers to learn more about the product	.710
Pictures in online advertisements will persuade consumers to click on the advertisement.	.933
Image features like colours, shape &size create a positive feeling towards the products or service	.679
Pictures help generate favourable consumer response to the brand of the product or service	.724
KMO = .747; Bartlett's Test of Sphericity = .000 Eigen value = 1.00 Percentage of variance Explained = 58.941

Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization.

a. Rotation converged in 3 iterations.

4.8.3 Content Advertisement Factor Analysis Results

The KMO for content advertisement was 0.768, with a significant Bartlett’s Test of Sphericity (p<0.05). The varimax rotated principle component applied resulted in two factors loading that explained 65.108 % of the variance. All the statements conformed to the set limit, hence no statement was rejected, and the results are presented in table 4.8.

Table 4.8: Content advertisement factor analysis

Component
1	2
Easy to understand information in advertisements interests the customer	0.63
Transparent information in advertisements develops brand favourability	.865
I am drawn towards adverts that have informative knowledge	.863
concise messages on advertisements draw favourable consumer response	.525	.626
Persuasive information will stimulate consumers to learn more about the products or service	0.56
KMO = .768; Bartlett's Test of Sphericity = .000 Eigen value = 1.00 Percentage of variance Explained = 65.108

Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization.

a. Rotation converged in 3 iterations.

4.9 Correlation analysis

Correlation analysis is a technique of assessing the relationship between variables: Thus, the study analysed the relationships that are inherent among the independent and dependent variables. The results regarding this were summarized and presented in Table 4.9.

Table 4.9	Correlation Results

CustormerSatisfaction1	COA	POA	MOA
CustormerSatisfaction1	Pearson Correlation	1
Sig. (2-tailed)
COA	Pearson Correlation	.208**	1
Sig. (2-tailed)	.001
POA	Pearson Correlation	.430**	.071	1
Sig. (2-tailed)	.000	.282
MOA	Pearson Correlation	.644**	.070	.462**	1
Sig. (2-tailed)	.000	.287	.000
N	231	231	231	231

**. Correlation is significant at the 0.01 level (2-tailed).

Source: (Research data, 2015)

Findings revealed that Multimedia advertising was positively and significantly associated with customer satisfaction (r = 0.644, ρ<0.000) indicating 64.4% positive relationship with customer satisfaction. Secondly, Picture Advertising was also positively and significantly correlated to customer satisfaction with (r = 0.430, ρ<0.000) showing that Picture Advertising has 48.86% positive relationship with customer satisfaction.

Lastly, content online advertising was also found to be positively correlated with customer satisfaction (r = 0.208, ρ<0.001). An indication of 21% positive relationship with customer satisfaction, content online advertising is also expected to influence customer satisfaction by 21%.

4.10 Multiple Regression Analysis

Prior to multiple regression analysis, the researcher conducted the tests to confirm whether the variable conform to the assumptions of regression model.

4.10.1 Assumptions of Regression Model

Testing of regression assumptions was conducted to ascertain the extent in which the data meets the assumption. Violations of assumption can result in biased estimates of relationships (biased standard errors), and untrustworthy confidence intervals and significance tests (Chatterjee & Hadi, 2012).

There are four assumptions of multiple regressions; the assumption of normality, the assumption of independence, the assumption of homoscedasticity, and assumption of linearity (Osborne and Waters, 2002).

Test of Normality

A normal distribution is assumed for many statistical procedures. Shapiro-Wilk (W) is the most robust method recommended for testing normality for small and medium samples of up to n = 2000. For large samples, Kolmogorov-Smirnoff test is recommended, for a given variable, W should not be significantly different from normal (Steercamp and Van, 1991).

The Shapiro-Wilk test results were; customer satisfaction 0.574, multimedia advertisement 0 .269, picture advertisement was .531, while content advertisement was 0.655. Since the p value for all the variables was more than 0.01, therefore the null hypothesis was not rejected; hence the errors are normally distributed.

Table 4.10: Tests of Normality

Kolmogorov-Smirnova	Shapiro-Wilk
Statistic	df	Sig.	Statistic	df	Sig.
Customer satisfaction	.160	16	.200*	.955	16	.574
Multimedia advertisement	.292	7	.072	.889	7	.269
Picture advertisement	.165	8	.200*	.932	8	.531
Content advertisement	.267	7	.142	.942	7	.655

Lilliefors Significance Correction

Test of linearity

Testing of linearity is necessary because, correlation, regression and other members of the general linear model assume linearity.Linearity means that the amount of change or rate of change, between scores on two variables is constant for the entire range of scores for the variables. Graphical method was used to examine the linearity of the data. From figure 4.1, the scatter plots indicate that the variance is distributed uniformly along the normal curve.

Figure 4.1	Linearity Plot

Figure 4.2:	Linearity Plot

Test of Multicollinearity

Multicollinearity test was carried out to establish if one or more predictor variables in a multiple regression model are highly correlated so that one can be linearly predicted from the others. Variance Inflation Factor (VIF) and coefficient of correlation between variables was used to test Multicollinearity. Table 4.11 results showed that the entire variable had VIF which were greater than 1 and less than 10 (Haire et al., 2006). Hence it was concluded that there was no multicollinearity. Also, all the coefficients of correlation were less than 0.8 in table 4.11 as recommended by Haire et al., (2006).

Table 4.11: Multicollinearity results

Model	Collinearity Statistics
Tolerance	VIF
1	(Constant)
MOA	.776	1.288
POA	.765	1.307
COA	.781	1.019

Source: (Research data, 2015)

Test of Homoscedasticity

Homoscedasticity refers to the assumption that the dependent variable exhibits similar amounts of variance across the range of values for an independent variable. Homoscedasticity means the relationship under investigation is the same for the entire range of independent variables. Lack homoscedasticity is shown by higher errors in some portion of range as compared to others. From the findings, the spread of predicting variables are along the normal plot, indicating that the dependent variables exhibit equal amount of variance across the values of the dependent variables.

Figure 4.3:	Scatter Plot for Homoscedasticity

4.10.2	Model Summary

Table 4.12 illustrates the model summary of multiple regression model, the results showed that all the three predictors in model (multimedia online advertising, picture in online advertising and content in online advertising) explained 58.6 % percent variation of customer satisfactionmeaning that there are other factors that explain 41.4%.

Table 4.12	Model Summary

Model	R	R Square	Adjusted R Square	Std. Error of the Estimate	Change Statistics
R Square Change	F Change	df1	df2	Sig. F Change
1	.705a	.598	.586	.33889	.598	41.928	3	127	.000
a. Predictors: (Constant), COA, MOA, POA
b. Dependent Variable: Customer Satisfaction

Source: (Research data, 2015)

4.10.3 Analysis of Variance

The ANOVA indicate the extent in which the data fit into the regression model. The ANOVA results were significant (F = 5.655, P = 0.001) indicating that the data fit into the model.

Table 4.13: ANOVAa

Model	Sum of Squares	df	Mean Square	F	Sig.
1	Regression	4.204	3	1.401	5.655	.001b
Residual	56.258	227	.248
Total	60.462	230

a. Dependent Variable: Customer Satisfaction

b. Predictors: (Constant), MOA, COA, POA

4.10.4 Coefficients

The coefficient indicates the extent in which each independent variable contributes to the change in the dependent variable. Content online advertising (COA) was significant (β = .152, p = 0.019), picture online advertisement (POA) was significant (β = 0.073, p = 0.015), also multimedia online advertisement (MOA) was significant (β = 0.160, p = 0.028) as indicated in table 4.14

Table 4.14 Coefficientsa

Model	Unstandardized Coefficients	Standardized Coefficients	t	Sig.
B	Std. Error	Beta
1	(Constant)	2.389	.478	5.000	.000
COA	.173	.073	.152	2.359	.009
POA	.098	.097	.073	1.006	.015
MOA	.101	.045	.160	2.214	.008

Dependent Variable: Customer Satisfaction

By entering the results into the regression model, the model for the study was;

Y= 2.38 +0.160 X1+ 0.073 X2+ 0.152 X3+ε…………………………………. (i)

4.10.5Test of Hypotheses

Rule of the thumb when accepting or rejecting a hypothesis is accept or fail to reject a hypothesis when p-value is more than α and reject a hypothesis when p-value is less than α. For this study α = 0.05 and will be compared with p-values applicable to the stated hypotheses as below (Sekaran, 2003).

Hypothesis 1(H01) stated that there is no statistically significant relationship between multimedia online advertising and customer satisfaction. Findings showed that multimedia online advertising had coefficients of estimate which was positively associated to customer satisfaction and had a significant effect basing on β1 =0.160 (p-value = 0.008) which was less than α = 0.05). The null hypothesis was rejected and it was concluded that multimedia online advertisinghas a statistical significant effect on customer satisfaction. Study provides insight on how to design ads, apps on multimediaadvertising networks firm’s business strategies.

Hypothesis 2 (H02) stated that there is no statistically significant relationship between picture in online advertisement and customer satisfaction. However, research findings showed that picture in online advertisement had coefficients of estimate which positively associated to customer satisfaction and had a significant effect basing on β2= 0.073 (p-value = 0.015 which was less than α = 0.05) hence the null hypothesis was rejected and it was concluded that picture in online advertisement has a statistical significant effect on customer satisfaction.

Hypothesis 3 (H03) stated that there is no statistically significant relationship between content in online advertising and customer satisfaction. However, research findings showed that content in online advertising had coefficients of estimate which is positively associated to customer satisfaction and had a significant effect basing on β2= 0.152 (p-value = 0.009 which was less than α = 0.05) hence the null hypothesis was rejected and it was concluded that content in online advertising has a statistical significant effect on customer satisfaction.

Table 4.15: Summary

Null hypotheses	Level of significance (0.05) (Regression)	Results of the study
H01: Multimedia advertisement has no significant effect on consumer satisfaction	(p-value = 0.008)<0.05	Rejected.
H02: Online advertisement Pictures has no significant effect on consumer satisfaction	(p-value = 0.015), <0.05	Rejected.
H03: Content advertisement has no significant effect on consumer satisfaction	(p-value = 0.009), < 0.05	Rejected.

Source: (Research Data (2015)

CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS

5.0 Overview

This chapter summarizes and presents the research findings, from the study. It has been organized to provide a concise summary of the study findings, conclusions, policy recommendations and recommendations for further research. The discussions are based on the research objectives of the study.

5.1Summary of Findings

The main purpose of this study was to establish the effect of online advertising features on customer satisfaction in selected five-star hotels in Nairobi County, Kenya. The trust for the study was to determine effect imposed by the features of online advertising features which are Multimedia, picture on customer satisfaction. The results indicated that the customers were satisfied with the products and services of the hotels. This is evident by their responses; majority of the customers agreed that; the hotel service is better than my expectation, if they came back they will stay at the hotel, they will also recommend the hotel to those who seek their advice. Most customers responded that they are happy with their choice to stay in the hotel, and were contented with the product and services offered by the hotel.

5.1.1 Multimedia Advertisement on Consumer Satisfaction

The first stated objective examines the impact of multimedia in online advertising on customer satisfaction. The descriptive statistics results indicated that; multimedia online advertisement improves customers’ satisfactions since; videos in the websites improve the interactivity of online advertisement, it improves customer involvement with the brand, also animation enhances the presentation of the contents.

Multimedia online advertising was found to have a coefficient of estimate which was positively associated to customer satisfaction and had a significant effect basing on (β1 =0.160, p-value = 0.008) which was less than α = 0.05). The null hypothesis was rejected and it was concluded that multimedia online advertising has a statistical significant effect on customer satisfaction. Research findings concur with those of (Tsang and Tse, 2005) who established that consumers respond favourably to animated colours, text, and graphics on websites, and therefore advice companies to develop digital video advertisements to increase consumer involvement with their brands. Similar findings were presented by (Yoo et al., 2004), who established a significantinfluence of technological developments involving plug-ins, JAVA script, Flash, and streaming media on customer satisfaction. Digital video can be in the form of streaming video, gaming, or music video (Rosenkrans, 2009). Similar findings were presented by (Yoo et al., 2004).

5.1.2 Pictures Advertisement on Customer Satisfaction

Based on the results of second objective it reveals that there is strong evidence to assert that there is a significant influence of pictures in online advertisement on customer satisfaction. The overall mean for the statements on use of picture in online advertisement was 4.33, this indicate that; images make online advertisement appear more attractive, pictures are easily understood by potential customers and stimulate the consumers to learn more about the product, it also persuades consumers to click on advertisement. The findings further indicate that, image features like colours, shape and size creates a positive feeling towards the product or service, it also helps generate favourable consumer response to the brand of product or service.

Regression analysis confirmed the same, research findings showed that picture in online advertisement had coefficients of estimate which positively associated to customer satisfaction and had a significant effect basing on β2= 0.073 (p-value = 0.015 which was less than α = 0.05) hence the null hypothesis was rejected and it was concluded that picture in online advertisement has a statistical significant effect on customer satisfaction. The study agrees with (Taylor et al., 2008) who pointed out that Pictures and images can make advertisements appear more attractive to potential customers. Research has shown that the average person spends about 30 seconds on a webpage before clicking onto another site; hence, pictures that take more than 15 seconds to download may not reach their audience (Adam, 2003). In fact, Kumar (2008) found that pictures are more effective than content in capturing consumers’ attention in online advertising.

5.1.3 Content Advertisement on Customer Satisfaction

The last objective illustrates a statistical significant relationship between content in online advertising and customer satisfaction. The study established that it is easy to understand information in advertisements,transparent information in advertisements develops brand favourability, customers are drawn towards adverts that have informative knowledge, and that concise messages on advertisements draw favourable consumer response.

Content in online advertising provides consumers with written information about products and services. There was a significant effect on online content advertisement on customer satisfaction (β2= 0.152, p-value = 0.009) which was less than α = 0.05 hence the null hypothesis was rejected and it was concluded that content in online advertising has a statistical significant effect on customer satisfaction.The study agrees with (Merwe and Bekker,2003; Rosen and Puriton, 2004) in which they established that online content advertisement influence customers to purchase product andservices. According to online Publishers Association (2008), 66% of online consumers do remember advertised messages on content websites and are likely to develop brand favourability. Nevertheless, it has been found that companies that focus solely on content may attract a smaller number of potential customers (Armstrong, 2001). Adam (2003) found that advertisers focus on delivering concise messages on banners which draws favourable consumer responses. Online advertising that focuses on content generally uses simple, static text because it loads faster than pictures and multimedia files (Moses, 2009). For example, Google focuses on content by using plain html format to maintain the basic ethos of its sites (Kotler and Armstrong, 2010; Adam, 2003).

5.2 Conclusion of the Study

The results of this study have useful implications on the use of multimedia advertisingin bringing information about hotel products to the customers, to promote their services and to advertise their products all over the world. Most hotels have developed websites where their products and services are advertised.

The study established that multimedia online advertisement has significant effect on customer satisfaction by improving the interactivity and customer involvement with the brand it also enhances the presentation of the contents.

The study demonstrates a positive influence in incorporating pictures advertising as the study shows a strong influence in forming a favourable attitude toward brand and loyalty. This finding encourages advertisers to increase their efforts regarding the Pictures feature in online advertisements thus influencing customer satisfaction.

Content feature in online advertisement was found to have a major impact on customer satisfaction. The reasons are; it is easy to understand information in advertisements,advertisements develop brand favourability, customers are drawn towards adverts that have informative knowledge, and that concise messages on advertisements draw favourable consumer response.

Based on Kano classification on trade-off situation in multiple criteria decision making, it states that if two product criteria cannot be promoted simultaneously due to technical or financial reasons, the criterion with the greater influence on customer satisfaction should be enhanced first. From the study results, multimedia had the highest impact on customers’ satisfaction, followed by content advertising and picture advertisement was the least.

5. 3 Recommendation of the Study

The study findings indicated that online advertisement features; multimedia, pictures and contents affects customers’ satisfaction. Based on above findings, the researcher made the following recommendations;

Multimedia online advisement was found to have significant effects on customer satisfaction. The hotels should therefore enrich their online advertisement using multi-media features, such as animations, digital video features that improves design and interactivity and also increase consumer involvement with their brands.

The use of picture in online advertisement was found to enhance customers’ positive attitude toward brand. Pictures can be used in online advertisement to attract customers to the brand. The hotel management should therefore enhance competitiveness in the market by using pictures in their websites.

The study established that content online advertisement has significant effect on customer satisfaction, since informative information attract the attention of the customers, and makes them have favorable attitude towards the brand. The hotels should therefore incorporate informative contents about their brand in the online advertisements.

5.4 Areas for further studies

A similar study to be carried out in all five-star hotels in Kenya in order to allow for generalization of the results. A study to be conducted on effects of television advertisement feature on customer satisfaction in hotel industry.Also a study can be conducted on effects of other forms of advertisement like bill boards, branding and event sponsorship on customer satisfaction.

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APPENDIX I: CUSTOMER QUESTIONNAIRE

Dear respondent

I am a postgraduate student from Moi University, in the School of Business and Economics. I am carrying out a research study on “Effect of Online advertising features on Customer satisfaction in selected five-star hotels in Nairobi County, Kenya.”Any information you give is purely intended for academic purposes and will be handled with utmost confidentiality. Your contribution, participation and co-operation will be highly appreciated.

Thank you for your assistance.

Carolyne Kiprop

SBE/PGM/013/12

Please tick where appropriate:

SECTION A: Demographic Information.

Gender

a) Male [] b) Female [ ]

2. Age bracket

18-30 years [ ]

31-50years [ ]

Over 50 years [ ]

Marital status

Single [ ] Married [ ]

Separated [ ] Divorced[ ]

Widowed [ ]

Please indicate the name of the hotel you are staying in

SECTION B: Specific information on customer satisfaction

What the level of agreement with the following statements isas pertains to customer satisfaction at this hotel?

STATEMENT	SD	D	U	A	SA
CS1	The hotel service is better than my expectation
CS2	I will come back again to stay at the hotel
CS3	I would recommend the hotel to those who seek my advice
CS4	The hotel has good first and last impression
CS5	Overall, I am satisfied with online based advertising

SECTION C: Specific information on online advertising

Multimedia in online advertising

STATEMENT	SD	D	U	A	SA
M1	Videos on websites improves the interactivity of online advertisements with the consumer
M2	I respond favourably to animated colours, text and graphics on websites
M3	Multimedia features improves the customer involvement with their brands
M4	Multimedia features that build thematic connections with the brand invoke a positive influence on consumer attitude
M5	Animation enhances the presentation of the content

Pictures in online advertisement

STATEMENT	SD	D	U	A	SA
P1	Images make online advertisements appear more attractive
P2	Pictures that are easily understood stimulate consumers to learn more about the product
P3	Pictures in online advertisements will persuade consumers to click on the advertisement.
P4	Image features likecolours, shape&size create a positive feeling towards the products or service
P5	Pictures help generate favourable consumer response to the brand of the product or service

Content in online advertising

STATEMENT	SD	D	U	A	SA
C1	Easy to understand information in advertisements interests the customer
C2	Transparent information in advertisements develops brand favourability
C3	I am drawn towards adverts that have informative knowledge
C4	concise messages on advertisements draw favourable consumer response
C5	Persuasive information will stimulate consumers to learn more about the products or service

Appendix II: NAIROBI CBD MAP