Application of revenue management practices to the theme park industry

Revenue management (RM) has been an essential strategy to maximize revenue for many capacity-limited service industries. Considering the common industry characteristics of traditional RM industries, the nature of the theme park industry suggests potential for enhancing revenue by exercising a variety of RM techniques. This study suggests practices for theme park operators for successful RM application. In addition, this study examines how customers perceive RM practice in the theme park industry compared to a traditional RM industry, hotel industry. The findings indicate that customers seem to perceive RM practice in the theme park industry as relatively fair practices as similarly perceived for the hotel industry. The findings are encouraging for the theme park industry because a relatively similar level of its customers’ perceived fairness of the RM practice compared to the hotel industry suggests that adoption and implementation of the RM practice has great potential to become successful as it has been in traditional RM industries, such as hotels.     

Influences of consumer characteristics on fairness perceptions of revenue management pricing in the hotel industry

Fairness perceptions play an important role in customers’ behavior, and this study explores which consumer characteristics influence fairness perceptions of revenue management (RM) pricing in the hotel context. To examine such differentiating characteristics, the study conducts a logit analysis by comparing two groups: one group of customers who consider hotels’ RM practices to be fair and the other group considers the practices to be unfair. The findings provide an opportunity for hotel managers to identify customers’ particular characteristics that affect customer's perceptions of the fairness of hotels’ RM pricing practices.     

Do reward programs truly build loyalty for lodging industry?

Hotel brands have sought numerous ways to build the relationship with their customers. Inspired by the airlines’ success, most major hotel chains have developed loyalty programs that reward customers for repeat business. However, the effectiveness of reward programs has been questioned. To explore reward programs’ potential to alter normal patterns to behavior, this research investigates how the timing of rewards affects customer loyalty for hotels and whether the effectiveness of these reward structures is moderated by customer satisfaction. This research also examines whether customer's value perception of loyalty program truly affect brand loyalty or program loyalty. In order to test the research framework, a 2 × 2 full-factorial, randomized, between-subject experimental design was conducted. In total, 209 respondents participated in the study. The results indicate that immediate rewards are more effective in building a program value than delayed rewards. Moreover, the value of loyalty program affects customer loyalty only through program loyalty to the extent that the program provides value to the customer. Finally, satisfaction plays an important moderating role on reward timing. Delayed rewards work better than immediate rewards only if customers are satisfied with hotel experience. In contrast, the immediate rewards in the dissatisfied experience become effective in their capacity to invoke customer loyalty.     

The influence of customer brand identification on hotel brand evaluation and loyalty development

Hotel firms have increasingly recognized that branding strategies constitute a strategic weapon to secure a competitive edge in the global hotel industry. To extend current understanding of hotel brand management, this study investigates the role of customer brand identification in the formation of hotel brand loyalty. This study contributes to the literature by establishing that customer brand identification is an indirect predictor of hotel brand loyalty through its three known antecedents. Results suggest that while the customer may identify with a particular hotel brand, hotel loyalty still depends on the customer's positive evaluation of factors relating to service experiences. However, as consumers’ identification with a hotel brand affects their evaluation of these factors, hoteliers should leverage customers’ brand identification to engender positive consumer evaluation of the hotel brand and, ultimately, increase brand loyalty.     

Enhancing customers’ brand loyalty via branded hotel apps

Many hotels have launched their own branded mobile applications to develop relationships with customers. Yet, research examining the benefits of branded hotel apps on brand loyalty is scant. The current research investigates the role of branded hotel apps on brand loyalty through customer engagement and brand trust in the hotel industry, based on uses and gratifications theory. Results identified cognitive and social benefits of the branded hotel apps positively influenced customer engagement and brand trust. Hedonic benefits positively influenced customer engagement and they indirectly influenced brand trust through customer engagement. Both customer engagement and brand trust positively influenced brand loyalty. Moreover, mediation effects of customer engagement and brand trust were identified. Results highlight how branded hotel apps serve as a facilitator of brand loyalty, providing theoretical and managerial implications.     

“货币补偿”总是最优策略吗?——高星级酒店不同服务失误归因下的情境研究

酒店服务的异质性和顾客需求的多样性使得服务失误在所难免。服务补救成为酒店修复服务失误,赢得顾客口碑和再次光顾的重要举措。在酒店管理实践中,货币补偿颇受管理者青睐,通常被作为应对服务失误的首要选择。然而,货币补偿是否为服务失误发生时的最优选择?文章以高星级酒店为研究背景,对服务失误进行情境设计,检验不同失误归因下货币补偿和非货币补偿的补偿满意度差异。数据分析结果显示:酒店因素导致的服务失误情境下,相比货币补偿而言,非货币补偿具有更好的补偿效果;其他顾客因素和顾客自身因素导致的服务失误情境下,货币补偿与非货币补偿间没有显著效果差异。此外,补偿满意度对顾客信任、重购意向与口碑有显著正向影响。     

心理契约违背对饭店顾客忠诚的影响——服务补救策略的调节效应

针对服务企业普遍面对的服务补救低效与顾客忠诚保持的挑战,文章基于心理契约与前瞻性服务补救理论,构建了顾客心理契约违背、服务补救和顾客忠诚间关系的分析框架,实证分析了心理契约违背对顾客忠诚的作用机理,并检验了服务补救策略对这一关系的调节效应。通过对262名饭店顾客的问卷调查,采用回归分析法处理数据,研究结果表明:心理契约违背两个维度与饭店顾客忠诚两个维度均呈显著负相关关系,顾客心理契约违背程度越高,顾客忠诚度越低;服务补救在心理契约违背与饭店顾客忠诚的关系中起到部分调节作用,即当企业服务出现失误而使顾客感知心理契约违背发生时,如果能采用恰当的服务补救策略,可以降低心理契约违背对顾客忠诚的负面影响。     

Government and social trust vs. hotel response efficacy: A protection motivation perspective on hotel stay intention during the COVID-19 pandemic

Based on protection motivation theory (PMT), this study conceptualizes a research framework to explain and examine customer intentions regarding hotel stays during the COVID-19 pandemic. Data were collected from 700 U.S. consumers via a crowdsourcing website in July 2020. Structural equation modeling was used to analyze the collected data for testing proposed hypotheses. The analytical results showed that the level of threat perceived by customers significantly reduced their intention to stay at a hotel. On the contrary, individual customer response efficacy significantly enhanced their intention to stay at a hotel. Additionally, both government and social trust, as well as hotel response efficacy, were found to significantly increase hotel stay intention by mediating the effects of threat perception and individual response efficacy. To the best of our knowledge, this study is one of the first attempts to apply PMT to explain customer hotel stay intentions during the COVID-19 pandemic.     

Value Creation

Abstract

The most essential theory of loyalty marketing is that a small increase in loyal customers can bring a significant increase in profitability to a business. Recently, businesses in various industries have turned single-brand loyalty programs into corporate-wide loyalty programs across different brands. The purpose of the study was to examine the effect of strategic alliance on customer loyalty in the hotel industry. Results of the study indicate that there is a positive relationship between strategic alliance and customer loyalty, and that value-creation from strategic alliance is only one element in the decision-making process of loyal customers. Managerial implications, limitations, and recommendations for future research were discussed.     

Investigating emotional commitment towards a region and a hotel brand

This study examines emotional commitment, brand identification and place attachment’s role in hotel brand loyalty and subsequent behavioral intentions. Data for the study stemmed from 823 quantitative and qualitative responses to an online questionnaire by Finnish customers of a Finnish hotel chain. K-Means cluster analysis identified three customer commitment levels, which along with qualitative comments enhance understanding emotional commitment and its role in hotel brand loyalty. A specific place, Lapland, in the hotel’s brand name helps extend place attachment and introduce the concept of brand identification with Lapland’s geographic region. The customer cluster most emotionally committed to the hotel brand also reported the strongest commitment to the Lapland region.     

A Study on the Moderating Role of Alternative Attractiveness in the Relationship Between Relational Benefits and Customer Loyalty

ABSTRACT

The purpose of this study was to investigate the moderating role of alternative attractiveness in the association between relational benefits (confidence benefits, social benefits, special treatments) and customer loyalty in hotel restaurants in South Korea. Data were collected from 250 hotel restaurant customers.

The data was analyzed using moderated regression analysis and subgroup analysis. The research findings are as follows: First, confidence benefits and special treatments positively affect customer loyalty. Second, alternative attractiveness has a homologizer moderating effect on the relationship between relational benefits and customer loyalty except for confidence benefits. At the end of the paper, theoretical contributions, managerial implications, limitations, and future research directions are discussed.     

Investigating the importance of positive hotel design

Despite customers’ attention to well-being, scant research has examined the role of positive hotel design to enhance customers’ well-being and brand evaluations. Derived from the positive design framework and Stimulus-Organism-Response model, this study investigated effects of positive design factors on customers’ responses in the context of the hotel industry. Findings from this study identified that corporate social responsibility to environment, escapism, and compatibility positively influenced customers’ well-being; whereas, only escapism and compatibility influenced self-brand connection. Both well-being and self-brand connection led to customers’ brand loyalty. Results provided suggestions to hotel managers in developing meaningful customer experiences through the lens of positive design.     

Customer loyalty: the future of hospitality marketing

For many years hospitality firms have believed that the goal of marketing is to create as many new customers as possible. While hoteliers believed it was important to satisfy the guests while they were on the property, the real goal was to continue to find new customers. This constant search for new customers is called conquest marketing. In the future, conquest marketing will not be sufficient. Instead firms need to practice loyalty marketing or retention marketing. The authors believe that this will be the successful wave of the future in hospitality. The goal of this paper is to present a framework for understanding customer loyalty. We do this first by examining the economics of loyalty. We then define loyalty and explain the difference between frequency programs and loyalty programs. We also show why satisfaction does not equal loyalty. We then introduce the Loyalty Triangle^©, which provides a framework for building customer loyalty. Each leg of the Loyalty Triangle^© is then examined in-depth, including examples of how hotel companies use the Loyalty Triangle^© to develop strategy. Next we present ways to measure the success of loyalty programs. Finally, we present future research issues.     

Designing lifestyle hotels

Art creates irreplaceable added value and serves as a source for satisfying the spiritual needs of hotel customers. To provide customers with memorable services, hotels not only need to continue improving their services (exploit), but also have to design artistic new services (explore). Thus, customer willingness to return to the hotel could be increased, enhancing customer loyalty. However, few hotels simultaneously implement these two types of trade-off activities (i.e., exploitation and exploration). According to the ambidexterity perspective, this study applied a case study approach to investigate the process through which hotel operators design lifestyle hotels. Moreover, this study involved constructing an operational framework that adopted art as the basis for differentiation. The research results revealed that in introducing art concepts into a hotel service system, hotels operators must attach a high level of importance to several key activities, including hiring a full-time executive artistic manager in the top management team to engage in innovation, integrating local culture and the natural environment into the design of an artistic servicescape, catering to customers’ needs, and adopting high-performance human resource practices. These activities enable hotels to enhance their service capability in simultaneously implementing the two mutual trade-off activities, specifically designing new artistic services (explorative innovation) and continually improving their services (exploitative innovation).     

Effects of service quality and food quality: The moderating role of atmospherics in an ethnic restaurant segment

This study empirically examined not only the relationship between perceived quality and satisfaction/loyalty, but also the role of customer perceptions of atmospherics in an ethnic restaurant segment. Specifically, this study, using hierarchical regression analyses, investigated the direct effects of service quality and food quality on customer satisfaction and loyalty as well as the moderating effect of the perception of atmospherics, in Korean restaurants. As expected, this study showed that service and food quality have positive and significant effects on customer satisfaction and loyalty. This suggested that, similar to other restaurant segments, employee service and food are of great importance for ethnic restaurants as well. Verifying the moderating role of atmospherics, however, this study found that good employee service can be more effective for increasing the satisfaction and loyalty of customers with a low perception of the atmospherics compared to those with a higher perception. Further, providing quality food is particularly critical for creating customer satisfaction in ethnic restaurants where atmospherics are not satisfactory. More detailed findings and implications are also discussed.     

Drivers of Customer–Brand Relationship Quality: A Case of Mainland Chinese Hotel Loyalty Program Members

Hotel chains should understand the effectiveness of the benefits offered by their programs and the influence of customer relationship management (CRM) initiatives of individual hotels because of the high operating costs of loyalty programs and the risk of creating an affinity to the rewards they offer rather than to the brand itself. This study determines the effect of the satisfaction of hotel loyalty program members on the benefits they receive, and the CRM efforts of individual hotels on the quality of their relationship with the brand. The sample was drawn from mainland Chinese customers because of the growing importance of the Chinese tourism market. Results reveal that program benefits have no significant effect on the quality of the relationship of the member with the hotel brand. The communication of the program to its members and the customer orientation of individual hotels are the key determinants of relationship quality.     

Gender,loyalty card membership,age, and critical incident recovery: Do they moderate experience-loyalty relationship?

The study examines the critical role of customer experience in determining hotel brand loyalty and the moderating role of gender, loyalty card membership, age, and critical incident recovery in this relationship. Based on a sample of 408 hotel guests and employing structural equation modeling approach, dimensions that comprise ‘customer experience with hotel brands’—hotel location, hotel staff competence, hotel stay, and ambience, hotel website and social media, and guest-to-guest experience—are found to have relative effects on hotel brand loyalty. The results contribute to hospitality realm by suggesting the moderating effect of gender, loyalty card membership, age, and critical incident recovery on customer experience-loyalty relationship. Implications for managerial practice and theory are discussed together with limitations and further research directions.     

Using machine learning and big data for efficient forecasting of hotel booking cancellations

Cancellations are a key aspect of hotel revenue management because of their impact on room reservation systems. In fact, very little is known about the reasons that lead customers to cancel, or how it can be avoided. The aim of this paper is to propose a means of enabling the forecasting of hotel booking cancellations using only 13 independent variables, a reduced number in comparison with related research in the area, which in addition coincide with those that are most often requested by customers when they place a reservation. For this matter, machine-learning techniques, among other artificial neural networks optimised with genetic algorithms were applied achieving a cancellation rate of up to 98%. The proposed methodology allows us not only to know about cancellation rates, but also to identify which customer is likely to cancel. This approach would mean organisations could strengthen their action protocols regarding tourist arrivals.     

BayesRec: Personalize search ranking with customer attribute-level willingness-to-pay using heterogeneous booking choice data

The ongoing travel restrictions owing to the COVID-19 shutdown continue to impact the hospitality sector. This pause on travel has led to a bigger regime shift in the customer's preferences for hotel selection. Therefore, this study aims to help understand customers’ evolving preferences by assessing the customers’ attribute-level willingness-to-pay (WTP) to tailor the booking experience. Furthermore, the study accounts for customers’ behavioral heterogeneity and decision choices while estimating WTP. The proposed approach utilizes multi-stage online modeling: (i) Segmentation to create behavioral customer cohorts; (ii) Hierarchical Bayesian modeling to estimate customer-level WTP; and (iii) Multi-criteria decision optimization to rank-optimize the hotel alternatives by leveraging the assessed attribute-level WTP. This continuous assessment provides personalized hotel recommendations and enhances customer’s booking experience, thereby allowing hotels to accelerate revenue recovery and aid in proactive demand generation for the next wave of travelers in a post-COVID economy.     

The impact of customers’ prior online experience on future hotel usage behavior

Service experience model stipulates the importance of service experience in increasing satisfaction, price acceptance, revisit intentions, etc. It has been extensively tested and validated in hotel management studies. However, the online service experience which, in these days, precedes the physical service experience has not be considered together in most hotel service experience studies. In hotel management literature, studies on online experiences are largely segregated from physical service experience model. In this study, prior online experience model is proposed which includes online experience preceding the physical service encounter, and a survey is administered. Result indicates the strong influence of online experience as a leading construct of the service experience model in hotels. Online experience strongly conditions the customers’ perception of physical service experience and, also, provides good ground for price acceptance. Interestingly, the influence of physical service experience on price acceptance seems to be rather alleviated with online experience, indicating the important role the online experience plays in managing customer perception on hotel service experience. Hotel management needs to pay close attention to their customers’ online experience beyond simple esthetics as the online experience seems to influence all the subsequent components of hotel service model.