Effects of innovation and marketing capabilities on service excellence and hotel performance

Abstract

This study analyzes the influence of three key factors: speed of innovation, innovation capability, and marketing capability on service excellence and hotel performance, with a specific focus on the mediating role of brand communication capability. A quantitative research design was employed, and data were collected from September to October 2024 in Indonesia through electronic surveys distributed via Google Forms. The sample comprises 440 respondents, consisting of hotel staff and guests who have stayed in 3- to 5-star hotels in Indonesia. These respondents were selected for their firsthand knowledge and experience with hotel services and marketing practices, ensuring the relevance of insights into the studied variables. The data were analyzed using SmartPLS version 4.1.0.8, applying the Partial Least Squares Structural Equation Modeling (PLS-SEM) approach. The results reveal that the speed of innovation significantly affects both innovation capability (β = 0.551) and marketing capability (β = 0.413). Innovation capability (β = 0.327) and marketing capability (β = 0.432) positively influence brand communication capability, which in turn affects service excellence (β = 0.534) and hotel performance (β = 0.621). The model explains 28.6% of the variance in service excellence and 38.6% in hotel performance. These findings underscore the strategic value of integrating innovation and marketing efforts, with brand communication capability serving as a key lever for enhancing service excellence and performance in the hospitality industry. Hospitality businesses should invest in speeding up innovation processes and refining marketing practices, as these efforts significantly enhance brand communication capability, leading to improved service quality and competitive performance in the market.