Building Customer Loyalty in Rural Destinations as a Pre-Condition of Sustainable Competitiveness

Abstract

The paper is dedicated to the issues of rural tourism with regard to the visitor’s loyalty towards the destination in a sustainable development context. Particularly, the findings of the research focused on exploring mutual relations among quality dimensions of the rural destination, overall satisfaction of the visitor, and his or her loyalty towards the destination are presented. A structural model was used to explore the relations among quality dimensions, overall satisfaction, and loyalty in the specific environment of the Czech Republic (inland European country, EU member, until 1989 a socialist country, nearly 93% municipalities with fewer than 3000 inhabitants). The research results allow deeper understanding of the visitor’s behavior and the factors influencing the loyalty towards the destination. The significance order of the dimensions according to their direct influence on the required loyalty towards the destination, i.e., coming back to the destination and spreading positive references to the destination, is as follows: 1. well-being, 2. image, 3. services. We conclude that overall satisfaction directly influences loyalty towards the destination.

1. Introduction and Literature Review

Destination areas carry with them the potential seeds of their own destruction, as they allow themselves to become more commercialized and lose their qualities that originally attracted tourists [1]. That is the reason why destination management should consider future development scenarios in order to ensure a balance between competitiveness and long-term sustainability. In countries of Central and Eastern Europe (including the Czech Republic) the emphasis of the tourism industry is on short term economic growth rather than long sustainability.

Destination is a geographic, economic, and social unit consisting of all the firms, organisations, activities, land areas, and installations which are intended to serve the specific need of the tourist [2]. Different approaches emphasize that a destination is a formal or informal spatial unit in which a number of businesses either formally or informally cooperate to attract tourists by offering a range of experiences grouped together to create a unique product [3]. For many years, the lack of co-operative actions among the tourism stakeholders has created a gap between the potential of tourism development and performance indicators in the CEE countries, including the Czech Republic. Tourism destinations are always in a state of continuous change, and recently there has been growing interest in tourism sustainability as one of the most important sources of the competitiveness of a destination [4]. Competitiveness refers to a destination’s ability to create and integrate value-added products that sustain its resources while maintaining market position relative to competitors [5] and the relative ability of a destination to meet visitor needs on various aspects of the tourism experience, or to deliver goods and services that perform better than other destinations on those aspects of the tourism experience considered to be important by tourists [6].

The World Commission on Economic Development (WCED) has defined sustainable development as: “development that meets the needs of the present without compromising the ability of future generations to meet their own needs” [7] (p. 16). The World Trade Organization (WTO) expands this concept, stating that sustainability includes quality of life for host communities, visitor satisfaction, taking care of the use of natural and social resources addressing the general objective of achieving a level of harmony among the various types of stakeholders involved in the tourism sector and/or interested in the way tourism in their area is managed and developed [8]. That said, it could be argued that the concept of sustainable tourism strives to harmonize issues of economic growth, environmental protection, and social justice. On the other hand, sustainable tourism is a sub-set of both tourism and sustainable development. The key differences between the two concepts relate to scale. Sustainable tourism only refers to the application of sustainability concepts at the level of the tourism industry and the consequent social, environment, cultural, and economic effects, whereas sustainable development operates at a broader scale that incorporates all aspects of human interactions with Earth’s environment [9]. Sustainable development creates the preconditions for sustainable tourism development and tourism can contribute to the sustainable, but also unsustainable development of a destination. The dimensions of sustainability in destinations are: economic, environment (natural), long term destination competitiveness, physical, and human (social-cultural) [10].

The new/renewed interest in the issue of sustainability in the tourism sector can also be seen as a direct consequence of the growing number of tourists whose reason for travelling is to discover the authenticity of the places they visit [11,12,13,14] by interacting closely with local communities with whom they can share a common sense of reciprocity and engagement [15]; aimed at preserving the natural, socio-cultural, economic, and environmental heritage of the destinations they visit [16,17,18,19]. Previous research has highlighted that the quality of the environment directly affects both the profit per visitor, because of tourists’ willingness to pay more to visit pristine destinations, and the resident’s utility function [20]. Therefore, it is of a crucial importance to consider environmentally friendly actions as an integrated part of destination management. It should be even more important in destinations where natural resources create the core of the destination product (e.g., rural areas).

Research on tourism sustainability has been focusing on rural, mountain, coastal, urban, and island areas, i.e., on all types of destinations. The growing interest in economic, social, cultural, and environmental sustainability as one of the most important sources of the competitiveness of a destination is particularly important in the case of rural destinations where tourism is often the main vehicle for economic development, with other sectors typically being unable to offset any downturn in tourism.

In a competitive world, all destinations strive to out-compete each other, often with little consideration of the implications for long-term sustainability. Ritchie and Crouch [4] undertook a comprehensive analysis of competitiveness and sustainability. The model provides the interlinking of elements of the destination system, although it does not provide a theoretical exploration of growth.

Destination managers need to be aware of the resources that provide the destination with opportunities to build on areas of comparative advantage, how these may be developed into a competitive advantage, and ensuring ongoing competitiveness. However, as Dwyer and Kim [6] caution, “competitiveness is a complex concept because a whole range of factors account for it”. The importance of competitiveness is that it enables a destination to create value-added products enabling them to maintain or improve their market position relative to competition [5] (p. 239). As Prideaux et al. [21] (p. 15) note “competitiveness in its most basic form is the ability of a destination to identify its key selling propositions, identify markets that are likely to purchase these propositions, create a market space where these products are able to be purchased, identify change and future threats, and have a the ability to maintain the process over a long period of time in a manner that is both environmentally and economicaly sustainable”. Ritchie and Crouch [4] add that unless a destination is sustainable, competitiveness is illusory. Destination management, apart from other key functions, should concentrate on resource stewardship that contributes to high quality products and boosts the visitor’s experience. A unique experience may become a pre-condition of building customer loyalty.

Many empirical studies confirm that quality and customer loyalty contribute to increasing company profits (e.g., [22,23]). In tourism studies, Baker, Crompton [24], for instance, examined the relationship between quality, satisfaction, and behavioural intentions and confirmed the hypothesis that perceived quality has a major influence on subsequent customer behaviour. Other studies in tourism found that tourist satisfaction directly influenced destination loyalty [25,26,27]. Some studies revealed an indirect relationship [28,29], while the others found that satisfaction exerted both direct and indirect influence on destination loyalty [30,31].

The following

Table 1. Current loyalty studies.

Authors	Destination	Methodology	Main Conclusion
Ribeiro et al. [32]	Island destination	SEM	Results indicate that visitors’ feeling welcomed and sympathetic understanding directly influence loyalty.
Gonzalez et al. [33]	Island destination	The discriminant analysis	There are no significant differences in the perceptions of young residents according to gender.
Sangpikul [34]	Island destination	SEM	In the case of island destinations, beach attraction is not the only factor contributing to tourist loyalty but people and safety are also essential components to retain loyal tourists.
Han et al. [35]	Spa tourism destination	SEM	Quality and value were found to have a critical role, and other study constructs were identified to act as direct/indirect driving forces of loyalty intentions. In addition, a mediating role of affect, satisfaction, and desire was found. Moreover, a moderating impact of culture (individualism vs. collectivism) on the loyalty formation was identified.
Albailty, Melhem [36]	United Arab Emirates	PROCESS model tool	Researech confirmed the importance of novelty-seeking and destination image in predicting tourist satisfaction in a destination and destination loyalty.
Verma, Rajendran [37]	Cultural heritage site	SEM	The results revealed that historical nostalgia had a significant positive effect on the perceived value, satisfaction, and tourists’ destination loyalty.
Yolal et al. [38]	Urban tourism	SEM	This study shows that differences exist between the two groups of visitors—first time visitors value cognitive attributes more and rely more on cognitive evaluation.
Iordanova [39]	Linz, Austria	Composite loyalty index	The findings reveal that the better the image, the higher the composite loyalty. Specifically, a destination’s affective image is more influential on tourists’ loyalty than a destination’s cognitive image.
Kim, Malek [40]	South Korea	Descriptive statistics, confirmatory factor analysis, SEM	The findings confirmed the influential role of self-congruity and destination image on destination loyalty.
Wang et al. [41]	Car tourism	PLS-SEM	The results show that perceived value and satisfaction are direct antecedents of destination loyalty. Above all, perceived value and tourist satisfaction mediate the relationship between destination image and loyalty.
Moral Cuadra et al. [42]	Border tourism	Structural analysis	It has been found that there is significant relationship between service experience in a destination and loyalty to the destination.
Wu [43]	Global destination	Fuzzy-set Qualitative Comparative Analysis (fsQCA) and SEM	Findings from the research sample support the argument that destination image, consumer travel experience, and destination satisfaction are the key determinants of destination loyalty.

indicates that this topic is constantly attracting the attention of the scientific community and summarizes significant recent studies exploring loyalty to the destination of the past two years.

Loyalty can be evaluated according to the customer’s intention to repeat the service purchase or his or her visit to the destination or according to his or her willingness and the level of spreading recommendations and positive references about the firm, product, or destination [44]. In connection with loyalty, some authors speak about the lower sensitivity of customers to price changes and to the willingness and greater confidence to buy other products/services of the same company as well. Gaining a long-standing loyal customer is a process of continual learning and recognizing all the possible wishes and desires of the consumer. It is a dynamic process that should not be limited and finished by the phase of “the sale of product/service”. If the rate of the customer’s stay with the company increases, the company’s profit rate increases as well.

The following text is dedicated to the issues of rural destinations with regard to the visitor’s loyalty towards the destination. Particularly, the findings of the research that focused on exploring mutual relations among quality dimensions of the rural destination, overall satisfaction of the visitor, and his or her loyalty towards the destination are presented. Nowadays, the customer of tourism is moving in a highly competitive environment where fulfilling his or her expectations, i.e., satisfaction or non-existence of complaints, does not necessarily mean immediate loyalty. Atkinson [45] claims that only one out of ten dissatisfied customers complains about the provided service. The other nine customers, if their problem is not settled in time, leave for competitors. On the other hand, these nine dissatisfied clients are impressed when the service provider promptly solves the problem to their satisfaction. Finally, the originally dissatisfied client can change into a satisfied and ideally loyal one. The mutual relations among satisfaction, perceived quality, and loyalty invoke research interest and they are the subject of long-term discussions among experts, e.g., [24,25,46,47].

Zeithaml et al. [48] warn that many practitioners and service providers, as well as some authors, tend to interchange the terms of satisfaction and quality. Nevertheless, research confirms that these two concepts have to be considered separately. These authors define service quality as a component of customer satisfaction (other components are the quality of products and the price). The customer’s satisfaction is generally perceived as a broad concept, whereas the quality of services concentrates especially on the dimensions of services. In their model, Zeithaml et al. [48] include not only the key dimensions of service quality and relations to customer satisfaction, but they also approach customer satisfaction as an indispensable presumption for reaching the required loyalty of the client; at the same time, they do not disregard the significant influence of situational and personal factors of the client.

The main aim of the paper is to research the validity of selected mutual relations that proceed on the structural model of Zeithaml et al. [48] on the level of rural destinations in the specific environment of the Czech Republic. The country is an inland European country, an EU member, until 1989 a socialist country, and consists of nearly 93% municipalities with fewer than 3000 inhabitants [49]. The research results allow the deeper understanding of the visitor’s behaviour and the factors influencing the loyalty towards the destination and thus contributing to the long-term competitiveness and sustainable development of rural areas.

2. Materials and Methods

Primary data that were necessary for meeting the research objectives were gained by online and face to face questionnaire surveys among the visitors to rural destinations in the Czech Republic by quota sampling (gender, age).

Table 2. The structure of research sample.

Characteristics	Sample Structure, n = 775
Gender	Male	50.5%	Female	49.5%
Age	18–23 years	11.3%	51–60 years	14.2%
	24–30 years	17.4%	61–70 years	13.8%
	31–40 years	14.3%	71 and more	12.6%
	41–50 years	16.4%
Education	primary	21.8%	higher	28.5%
	secondary	49.7%

describes the sample structure. The respondents (n = 775) had experienced staying in some of the rural areas of the Czech Republic (current or no older than two years).

The conducted research and the following factor analysis revealed six dimensions representing the quality of the rural destination: services, image, transportation, well-being, information/communication, and attractions/experiences. The 19 destination quality factors used in factor analysis (see

Table 3. Quality dimensions of rural destination.

Dimension 1: Services
F3	Accommodation
F4	Food
F5	Social and experiential events
Dimension 2: Image
F2	Cultural monuments
F17	Uniqueness of destination
F16	Overcrowding of the destination
F11	Image of the place
Dimension 3: Transportation
F6	Availability of transportation to the destination
F7	Local transportation
Dimension 4: Well-being
F15	Destination cleanliness
F14	Sense of security
F12	Level of prices of services and goods in the destination
F13	Level of personnel quality in tourism services
F10	Friendly acceptance by the locals
Dimension 5: Information/Communication
F9	Information and communication prior to arrival
F8	Availability and quality of information
Dimension 6: Attractions/Experiences
F1	Natural attractions
F18	Additional infrastructure
F19	Respecting sustainable development of the destination

) were chosen on the basis of the theoretical and scientific research and models related to quality destination [50,51,52,53] as well as our own previous qualitative and quantitative research adapted to the Czech tourism environment [54].

The structural model was used to explore the relations among the quality dimensions of the destination, overall satisfaction, and loyalty. This model presumes the significant direct influence of individual dimensions on the overall satisfaction and loyalty of the customer and at the same time, the significant direct influence of satisfaction on the loyalty towards the destination. As Oppermann [44] mentions, loyalty is defined according to the customer’s intention to repeat his or her visit to the destination and according to his or her willingness to spread positive references concerning the visited area. The explanatory latent variables correspond with the dimensions of quality, the indicators of which are manifest (directly measurable) variables that correspond with the quality factors pertaining to the given dimensions. Standardized regression coefficients between quality dimensions and quality factors express the relationships between them. The validity of these relations is quantified by Crombach alpha. Latent variables for which the Crombach alpha values did not reach 0.7 were removed from the model [55]. The explained latent variables are satisfaction and loyalty. SmartPLS software was used for quantification of the model. The significance of paths coefficients between individual latent variables was tested by the means of bootstrapping on the 5% significance level. The insignificant ways were removed from the model in order to simplify the model and to interpret it more precisely.

3. Results and Discussion

Figure 1 presents the structure of statistically important relations among the dimensions of destination quality, overall satisfaction with the destination, and the loyalty towards the destination. The basic model presumed that the dimensions of quality are indicated by all 19 research factors from Table 3. However, some dimensions do not meet the condition of the minimal Crombach alpha value (if it is not “0.7”) and this means that there is not the appropriate correlation between some manifest variables and the relevant latent variable. This can be caused by an insufficient diversity of answers among the respondents. The following factors were removed from the model (Figure 1): F5 (dimension 1); F16 (dimension 2); F6, F7 (dimension 3); F18, F19 (dimension 6).

The original model presupposed that the loyalty towards the destination is also directly influenced by the overall satisfaction with the destination. This impact was confirmed and proved to be the most important (the path coefficient 0.652), which was expected due to the tight relation between satisfaction and loyalty and that minor differences should become evident due to the different influence of the quality dimensions of the destination.

The model presented in Figure 1 clearly shows that dimension 4 (well-being) was identified as the most significant one. This dimension has the largest impact on satisfaction and concurrently it is also the most influential in loyalty towards the destination of all the dimensions. This fact corresponds with the results mentioned by Meng et al. [56]—as well as with the results of the previous research of the authors [57]—where this dimension was evaluated as the most important from the viewpoint of evaluating the destination quality factors’ significance by the visitors themselves. All the relevant factors (F15, F14, F12, F13, F10) stayed in the model as significant indicators of this dimension, which proves the fact that all the factors have an important impact on creating the dimension of well-being.

Another important dimension is dimension 1: services that is indicated by the factors of accommodation (F3) and food (F4). Factor 5 was removed as an indicator of this dimension to achieve higher reliability of the model (see methodology). This dimension has almost comparable influence on satisfaction as the dimension of well-being; nevertheless, its impact on loyalty is distinctly lower. This fact can be explained by the tight link of this dimension to specific accommodation facilities, which on one hand influences satisfaction in the destination, but on the other hand it is only a partial component of the complex destination product. Loyalty is connected with the destination as a whole and the relation to the accommodation facility does not have to be that strong, as in the future there will probably be many alternative accommodation facilities.

The third dimension in the order of influence on overall satisfaction is image. Factor F16 was removed from its indicators because it was found to be insignificant. It would be interesting to explore the relation of this factor (overcrowding of the destination) in the frame of the dimension of well-being. The importance and influence of image is confirmed by Middleton and Clarke [50]; Eklof [58]; Coban [59], and Gajdosik and Smardova [60]. From the viewpoint of the influence of this dimension on loyalty, a higher impact was proved here than in the case of the previous dimension 1: services.

Dimension 5: information and communication showed a direct influence only on satisfaction. Concerning loyalty, the influence is only indirect by means of evaluating the satisfaction with the destination. So, we can assume that the indicators of this dimension are important especially during the first visit to the destination. The following dimension 6: attractions/experiences, that is represented by only one quality factor (natural attractions), exhibits similar relations, i.e., rather small but direct influence on satisfaction only. The last dimension 3: transportation was completely removed from the final model due to its unimportance; in other words, no significant influence on satisfaction nor loyalty was revealed. This fact corresponds with the previous research of the authors [57].

The significance order of the dimensions according to their direct influence on the loyalty towards the rural destination is: well-being, followed by image and services. When comparing these obtained quality dimensions with the similar research aimed at the urban type of the destination [61], congruence can be found in the dimensions of service, image, transportation and well-being, where the quality of the provided services in the dimension of services, followed by the dimension of image, appears to be the most significant for visitors to urban destinations.

4. Conclusions

While academics have long recognized the importance of sustainability, particularly in rural areas where natural features represent an important resource, the endorsement of growth as a key indicator has often resulted in tourism development that does not meet the needs of the surrounding environment. This is despite an emerging consensus that unless areas visited by tourists are sustainable in the long term, visitor numbers will decline as the quality of the experience deteriorates. That is why the models that aim at identifying the key success factors leading to visitors’ satisfaction and loyalty are the core interest of research of the quality aspects of different types of tourism destinations. In the present paper, we highlighted the approach towards building customer loyalty in rural destinations within the sustainable competitiveness framework.

The research findings aim at providing a more detailed view of mutual relations and links that model the visitor’s loyalty towards the rural destination; they deepen the knowledge of consumer behaviour of visitors/participants of tourism in rural areas. In conclusion, we can state that the direct influence of the overall satisfaction on loyalty towards the destination was proven (in agreement with Assaker, Vinzi, O’Connor [62] and Kim and Brown [27]). The order of the dimensions according to their direct influence on the required loyalty towards the destination, i.e., coming back to the destination and spreading positive references to the destination, is as follows: 1. well-being, 2. image, 3. services. The direct influence of other research dimensions on loyalty was not proven. Nevertheless, when exploring loyalty in tourism, the impact of different segmentation characteristics of respondents must not be neglected. The authors intend to research these relations in the future; considering the results’ dependency on the particular destination would be interesting as well.

As rural areas have an important asset contributing to their competitiveness in the market—unspoilt natural areas—sustainable development should be a priority. The decline in ecosystem complexity of natural areas could lead to a weakened position in the highly competitive globalized tourism market. Destinations that rely on natural environment as their main “pull” factor will be likely to suffer as the quality of ecosystems declines. From the destination marketing point of view, customer loyalty is an important factor contributing to the sustainable competitiveness of rural destinations as an important element of customer behaviour in tourism. Therefore, it is recommended as the objective of further research. The proposed model can be tested within frameworks of different types of destinations where different variables can play significant roles with specific implications for destination policy makers and destination management organisations.

The research findings contribute to broadening the current theory and studies of destination quality that reflect contemporary environmental development; supplying theoretical frameworks of destination quality dimensions, as well as contributing to better understanding of behavioral mechanisms in rural areas. From a practical point of view, the findings can be used by destination managers and tourism service providers to support their customers’ loyalty and to increase the quality of management to improve their competiveness. In common practice, the results revealing the key dimensions and the quality factors for tourism participants can also be used for creating effective communication strategies.

In similar areas (CEE countries), the revealed key destination quality dimensions and factors can simplify the practical application of scientific methods (e.g., SERVQUAL or Importance-Performance Analysis). The results can also serve as input data for these methods, enabling the evaluation of the current qualitative level of rural destinations.

The uniqueness of the presented research lies in the linking of the traditional marketing concept of understanding the visitor’s behaviour and the factors influencing loyalty towards the destination with the sustainable tourism principles.