The effects of Airbnb’s price positioning on hotel performance

This study examined the relationship between the price positioning of Airbnb listings, measured in price difference between a hotel property and the nearby Airbnb listings as well as price dispersion among these Airbnb listings, and the performance of nearby hotels. An exploratory analysis using field data points collected from the Airbnb listings and their hotel counterparts in the metropolitan area of Austin, Texas between Quarter 3, 2008 (debut of Airbnb in Austin) and Quarter 2, 2011 reveals intriguing findings. The entry of Airbnb listings was penetrative to local hotels. However, the price positioning of Airbnb, manifested in higher average price as compared to nearby hotels, as well as larger price dispersion among individual listings, significantly mitigated such penetration. Important theoretical contributions and practical implications for hotels are discussed.     

Importance Performance Competitor Analysis (IPCA): A study of hospitality companies

Although Importance Performance Analysis (IPA) is a popularly used method in many research areas, academics mainly criticise it because of its relative structure and lack of consideration of competitors. In the present study, the author proposes an extended version of IPA, which is called Importance Performance Competitor Analysis (IPCA), to address these shortcomings. The proposed method considers the GAP score, which is obtained by the comparison of an attribute’s importance and the focal company’s performance in the same attribute. Moreover, it uses focal and competing companies’ performance differences score. IPCA offers different strategies for each attribute depending on the quadrant that it is positioned in. Absolute structure and consideration of competitors are the advantages of IPCA. Another characteristic of the IPCA is its simplicity, like IPA, there is no necessity to have advanced level statistical knowledge.     

Weekend vs. midweek stays: Modelling hotel room rates in a small market

Using a hedonic model, we estimate the willingness to pay for different hotel characteristics for a small market environment. We uniquely collected a data set from a meta-booking engine including their detailed customer review ratings compiled from numerous individual hotel search engines. We argue that meta-search engines are well suited to gather prices to be used in hedonic models. In our estimation, we distinguish hedonic models for single room stays during the week potentially relevant for business travellers and double room stays during the weekend intended for leisure. Important determinants of hotel room prices are popularity ratings (derived from customer reviews), the hotel star rating, weeks of advance booking, and certain hotel characteristics such as express checkout, room service, or Internet access. A number of important characteristics such as wellness offers or wireless Internet in the rooms are insignificant pointing to the conclusion that these may be regarded as standard attributes and do not fetch additional economic value in terms of higher consumer willingness to pay.     

Generic dimensionality of hospitality in the hotel industry: A host–guest relationship perspective

The main objectives of this study are to identify the generic facets of hospitality for hotel services irrespective of their star rating, as well as to determine the impact of generic dimensionality on guest satisfaction. The responses of 305 local and foreign hotel guests in a questionnaire survey were analysed using a Structural Equation Modelling technique. The generic facets of hotel hospitality were identified as personalisation, comfort, and warm welcoming. Of the three, only personalisation and warm welcoming contributed significantly to predicting guest satisfaction. This study is aimed at adding to the body of related literature by sharing new insights on how the generic dimensionality of hospitality in its entirety differs from that of upscale hotel hospitality.     

Determinants of consumers’ choices in hotel online searches: A comparison of consideration and booking stages

Using a stated choice experiment, this study uncovers how hotel review- and price-related attributes affect consumers’ formation of consideration sets and hotel bookings based on online search results alongside a two-stage model of consideration and choice. Empirical findings indicate that consumers’ evaluations of certain attributes vary across these stages. During the consideration stage, the listed hotel price, promotional discount, overall rating, review volume, and booking popularity are significant attributes for prospective guests, whereas price disparities across websites are not. Insignificant interaction effects among these determinants imply that in this stage, consumers employ fast-frugal heuristics and a noncompensatory strategy. During the booking stage, listed price, promotional discount, overall rating, and review volume inform consumers’ booking decisions. Furthermore, the interaction effects point to consumers’ adoption of a compensatory strategy in making a final booking decision. Finally, this study concludes with implications for hotel pricing and system optimization of online platforms.     

Predicting Hotel Choice Decisions and Segmenting Hotel Consumers: A Comparative Assessment of a Recent Consumer Based Approach

Abstract

Given the intensified competition to attract today's increasingly discerning hotel guests, it is vital for hotel managers to understand the set or bundle of hotel attributes which are demanded by the potential traveler. Unfortunately, marketing research in hotels is still mainly confined to the analysis of guest-related data collected during registration or from guest comment cards. These data, however, have little merit as predictors of customer behaviour and cannot answer the “what if” questions. In recent and past research in hospitality and tourism, researchers have demonstrated the use of product attributes in predicting consumer preferences and segmenting markets (Bell and Morey 1997; Kim 1996). In undertaking this approach to behavioral study, many researchers in the field have been attracted to use conjoint attribute part-worths, (the judgmentally quantified attribute valuesderived from conjoint modeling. This study attempts to utilize the compositional self-explication model as a reference model to assess the comparative superiority of the conjoint model in predicting client preferences among travelers to Hong Kong. It also seeks to reveal subgroup preference variations by using two segmentation approaches. The overall finding indicated that the most important hotel attribute sought by all respondents is Room Rate, followed by Star Rating, Location, Brand and Room Type. In terms of market segments, the results revealed similar preference profiles among leisure, short-haul and infrequent travelers as one group and business, long-haul and frequent travelers as another.     

Impacts of cruise service quality and price on vacationers’ cruise experience: Moderating role of price sensitivity

In view of the increased interest in cruise vacations and limited study on cruises, the purpose of this study was to shed light on an understanding of cruise vacationers’ evaluations of onboard experiences with cruise lines in North America and their loyalty-formation process. The empirical results revealed that interactional quality and outcome quality were significantly and positively associated with novelty and perceived value which in turn, affected satisfaction and loyalty. In addition, perceived price was a significant and negative predictor of perceived value. The moderating function of price sensitivity showed that novelty was more effective in inducing satisfaction in the low price sensitivity group and it was more effective in enhancing perceived value in the high price sensitivity group. Overall, these results help cruise line operators who observe that cruise vacationers have become more demanding on service quality, price, and value. Practical and theoretical contributions are discussed.     

Corporate brand strategy: Drivers and outcomes of hotel industry’s brand orientation

The MNC resellers are vastly competitive and capital-intensive. Based on the corporate brand orientation, the objective is to investigate how the individual dimensions of hotel industry’s brand orientation can improve a corporate experience and subsequently create superior hotel performance and retailer preferences. A model of the integration of the hotel industry’s brand orientation was tested in a survey conducted among MNC resellers from hospitality industry. Structural equation modelling was applied to gain insight into the various influences and relationships. The research makes two main contributions. It makes a theoretical contribution by classifying the integration of the hotel industry’s brand orientation for hospitality industry and from this extrapolate key suggestions for further study. The continuous evolution and economic influence of the hospitality industry require the application of innovative marketing practices.     

Big data hedonic pricing: Econometric insights into room rates’ determinants by hotel category

This research uses a big dataset of online prices published on Booking.com by three-, four- and five-star hotels located in Madrid (Spain). Data is broadened by other sources, resulting in a rich set of context-, hotel- and offer-based variables. This research aims to determine the impact of these variables on the online room prices set by one representative sample, featuring the total pricing behaviour as well as per hotel categories. The variables considered, their extent and the insight per category represent a novelty and complement the literature on demand forecasting and hedonic pricing, enabling the improvement of optimisation techniques. The models, based on regression analysis with random effects, reveal a significant impact of the variables on room prices and a clearly distinct behaviour for five-star hotels. This research contributes to the scientific community and practitioners by showing the pricing dynamics behaviour of an important urban destination by star rating.     

Business travellers’ hotel expectations and disappointments: A different perspective to hotel attribute importance investigation

Hotel attribute importance studies have a long tradition in hospitality research. This study investigates the issue for business travelers by asking the respondents to state their expectations and disappointments / dissatisfaction in an open question format instead of rating the importance of attributes directly.

The aim of the study is twofold: (1) to learn about expectations and past disappointments of this particular segment to provide additional insight for customizing hotel offers and (2) to investigate whether the findings reported in literature so far are mirrored or not.     

Exploring competitive hotel selection attributes among guests: An importance-performance analysis

This study aimed to explore the hotel selection attributes among local guests in the competitive hotel industry in Korea and to test the role of these explored attributes in building behavioral intentions. A total of seven dimensions, which involved 17 intangible and 16 tangible attributes, were identified. The findings indicated that intangible attributes are relatively more important but offer less satisfaction, whereas tangible attributes provide a higher level of satisfaction than perceived importance. Moreover, the importance-performance analysis grid visually depicted the importance and satisfaction ratings of each attribute demonstrating its strengths and weaknesses. All intangible attributes were significantly associated with intentions.     

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.