Market orientation in mid-range service,urban hotels: How to apply the MKTOR instrument

This work analyses market orientation (MO) within hotels and its impact on business performance (marketing, economic and financial results). To achieve this, after developing a measurement scale based on MKTOR, a survey targeting senior managers of four-star hotels located in Spain was carried out. The data of the study show that the more market-oriented hotels know their customers and competitors better and that they are more effective at coordinating their actions. This in turn generates a positive and direct effect on customer satisfaction, on the value added for them and on the perceived image of the hotel. Also, perceptions about technological turbulence positively affect the adoption of the MO philosophy and, therefore, its consequences in terms of company performance. Finally, the effects of MO on results would be overvalued if the perception of the impact of the crisis is not taken into account.     

To Ban or not to ban rate parity,that is the question… or not?

Considering the heated debate in the hotel industry about the rate parity clause and the appropriateness of its ban to give rise to rate disparity, this article analyzes the hotel performance that has resulted from the rate parity prohibition established in some European countries, by looking into the market value of the hotels involved. The empirical analysis conducted on a sample of hotel companies trading on the stock exchange in Germany and France shows that the approval of the rate parity ban generates positive abnormal returns. However, an increase in risk is detected. It seems that, while the prospects of greater autonomy to set prices in the hotel industry and stronger competition in the online distribution industry are looked at positively, the hotels will have to deal with a customer’s potential higher perception of price unfairness, less control over its own brand and a greater likelihood of price wars.     

Dual-branded hotels: Resource-based entry strategies in agglomerated markets

Despite the growing importance of dual-branded hotels, research on this trend is lacking. This study investigates the effect of resource-based entry strategies for dual-branded hotels vis-à-vis incumbent market competition on performance. Using a hierarchical linear model, we found that best performance is achieved by dual-branded hotels that pursue a diversification strategy by entering the market with one brand above and one brand below the mode class of the market. Dual-branded hotels can thus achieve competitive advantage by exploiting superior financial resources and tourism destinations are able to gain monetary advantage from resources employed by dual-branded hotels. This study extends current research on dual-branded hotels by investigating entry strategies and contributes to the resource-based view literature by investigating dual-brands’ resource exploitation and resource spillovers in agglomerated markets.     

Higher tourism specialization,better hotel industry efficiency?

This study examines the effects of both specialization in tourism and market competition on the efficiency of the hotel industry. For this purpose, stochastic frontier analysis (SFA) was employed to evaluate the efficiency of the hotel industry on a provincial level in China and to analyze how it is impacted by specialization in tourism and market competition. The results confirm that tourism specialization and market competition exert a synergistic effect on hotel industry efficiency in China. This study finds that tourism development as represented by a high level of tourism specialization by a destination does not guarantee high efficiency in hotels but does enhance the negative effect of market competition on hotel industry efficiency. Significant policy and managerial implications stem from these findings.     

Total quality management, market orientation and hotel performance: The moderating effects of external environmental factors

With the market competition of hotel industry being heated, it is critical that hotels have a breadth of resource and more flexible forms to meet the needs of a changing marketplace. In the past, the relation of total quality management (TQM), market orientation, and performance are equivocal. These mixed results may be due to some factors or not to include the environmental factors. This study adopts the Input-Processing-Output (IPO) concept model to construct all variables research model. The research surveyed samples of 588 and used Structural Equation Model and discriminate analysis for analysis and testing. The results show that TQM positively affects hotel performance. Market orientation positively affects hotel performance. Market orientation has the mediating effect between TQM and hotel performance. External environment factors truly play a moderator between TQM, market orientation and hotel performance, especially when external environment factors greater changes are going to help to build relationship with customer, to enhance hotel performance and further to gain chance of hotel's survival.     

Share repurchases and stock market reactions: Messages from the restaurant industry

It is generally accepted that investors tend to react favorably to share repurchases. However, it is actually not uncommon for investors to underreact to some share repurchases. Recently, a number of restaurant firms have spent huge amounts of internal cash on share repurchases but little is known regarding the market’s underreaction to share repurchases in the restaurant industry. Hence, this study attempted to identify factors that could mitigate market reactions to share repurchases. Analyzing U.S. restaurant firms, this study revealed that growth opportunities, franchising, dividend payments, and spending excessive free cash flows on share repurchases negatively impacted market reactions. However, the negative impact of growth opportunities was weaker for franchise restaurants than for non-franchise restaurants. This study provides useful managerial information regarding the timing of and the amount that can be spent on restaurant firms’ share repurchases.     

Competitive actions and firm performance of hotels in Hong Kong

Drawn on the recent action–reaction perspective in competitive dynamics studies, this paper suggests that not only the number of competitive actions, but also the extent of differences of action portfolios within and between firms are relevant in determining a firm's performance. A distinction of these differences of competitive action portfolios among firms and the corresponding measures to capture these effects are proposed. This study of Hong Kong high tariff hotels confirmed that diversifying a hotel's portfolio of actions, but not too much different from the competitors, would help hotels to achieve higher financial performance in a competitive market.     

Privatization,market competition,international attractiveness,management tenure and hotel performance: Evidence from Slovenia

This paper tests several hypothesis related to the impact of privatization, market competition, management tenure and international attractiveness on the cost efficiency of tourist hotels. We measure efficiency using the innovative Bayesian frontier methodology. The data involve a sample of Slovenian hotels which operate in a highly dynamic environment. From the results, it is clear that hotel efficiency is positively related to privatization and international attractiveness, and negatively related to longer management tenure. No significant link, on the other hand, is found between market competition and hotel efficiency. Further discussions of these findings and related managerial implications are provided.     

An analysis of the relationship between market orientation and business performance in the hotel industry

The purpose of this study was to conduct an investigation into the link between market orientation and business performance in the hotel industry. Data were generated from 63 hotels in Hong Kong. The findings indicated that market orientation is positively and significantly associated with the marketing performance and financial performance of a hotel. The implications of the findings are discussed and the limitations of the study as well as future research directions are addressed.     

The impact of regulation and ownership structure on market orientation in the tourism industry in China

The nature of market orientation and its impact on business performance and other related outcomes have been extensively researched in a range of service contexts including tourism. In contrast, our understanding of the factors that influence market orientation is still limited. This paper reports on a study that contributes to our understanding of the determinants of market orientation within the tourism sector by focusing specifically on the role played by two strategically important variables, namely government regulation and ownership structure. The study analyses two national samples of hotels and travel services in the rapidly growing tourism industry in China. The hotel sector has been open to foreign investment for two decades and has a diversified ownership structure, whereas the travel services sector has been dominated by government owned firms and relatively closed to foreign investment. The results of the survey suggest that of the two new antecedents, only government regulation has a significant role to play in driving market orientation. Internally, access to appropriate managerial and marketing capabilities was identified as a significant predictor of the development of market orientation.     

Exploring asymmetric effects of attribute performance on customer satisfaction in the hotel industry

Understanding the asymmetric effects of attribute performance (AP) on customer satisfaction (CS) is important for the managers in the hotel industry. Although several studies concerning this issue have been conducted, the varies of asymmetric effects across different market segments have not been revealed. To this end, this study aims to explore the asymmetric effects of AP on CS with respect to different market segments, including different types of hotels, different types of travelers and travelers from different regions. Four theories, i.e., expectation-disconfirmation paradigm, three-factor theory of CS, customer delight theory and prospect theory, are adopted to explain the formation of CS from the perspective of different market segments. The penalty–reward contrast analysis (PRCA) and asymmetric impact-performance analysis (AIPA) are used to analyze 1,547,869 user-generated ratings collected form TripAdvisor posted by the travelers from 140 countries concerning 9,596 hotels from 75 capital cities around the world. The results suggest that the asymmetric effects of AP on CS may vary across different market segments, including different types of hotels, different types of travelers and travelers from different regions. In addition, the priorities of hotel attributes for each type of hotel with respect to different types of travelers and travelers from different regions are also analyzed by AIPA. The obtained results will be valuable for researchers to conduct further studies and hotel managers to formulate improvement strategies.     

How do hotels adapt their pricing strategies to macroeconomic factors?

The hospitality industry is naturally highly sensitive to subtle changes in the external environment, and its performance is affected by various external factors. Therefore, hoteliers should carefully monitor the various macroeconomic indicators affecting the market, when making important strategic management decisions. In particular, hotels’ pricing decisions are important because they play a crucial role in the determination of hotel revenue and in the process of profit maximization. In this paper we classify hotels by business model (i.e., chain management, franchise and independent) and analyze how these different types of hotels in Switzerland adapt their pricing strategies to macroeconomic factors (i.e., exchange rate, room supply and market demand). We find that hotels adopting different business models react differently to the same macro shock. Implications of our findings and future research directions are discussed.     

Types of agglomeration effects and location choices of international hotels in an emerging market

When international chain hotels are seeking new locations in which to establish new properties, local knowledge of those locations is essential for success. By incorporating agglomeration and internationalization research, this study investigates how international hotels can acquire that local knowledge from the existing hotels. The study presents two different kinds of hotel agglomerations (same-country-of-origin and higher-differentiation agglomerations) as sources of local knowledge and shows how international hotels might select their locations based on types of agglomerations and their entry strategies. The study employs conditional logistic regression, using a sample of international hotels in China. Results indicate that international hotels, especially those with franchising, are more likely to choose a location where the hotels from the same country of origin are highly located. Because they share the same culture and business practices, new hotel entrants may more easily assimilate the local knowledge that compatriot hotels have accumulated.     

Does Airbnb have a homogenous impact? Examining Airbnb’s effect on hotels with different organizational structures

Although a number of studies have examined Airbnb’s impact on hotels, previous studies have yielded mixed results and are limited in their geographical scope. Additionally, the impact of Airbnb on hotels with different organizational structures has not been previously analyzed. Accordingly, the purpose of this study is threefold: 1) to add to our understanding of the impact of an increase of Airbnb inventory by clarifying previously inconclusive results; 2) to examine the extent to which Airbnb listings affect hotel performance measures in the overall U.S. hotel market; and 3) to investigate the influence of Airbnb on key hotel metrics by elaborating the effect of Airbnb on hotels operated under different organizational forms- chain-managed, franchised, and independent. Our results show an adverse impact of Airbnb on hotel RevPAR and ADR metrics across different organizational structures. However, interestingly, Airbnb listings did not negatively affect occupancy numbers. Theoretical and practical implications are discussed.     

Key drivers of innovation capability in hotels: implications on performance

Innovation capability is critical for the modernization and competitiveness of the hotel industry. This work analyzes the role of hotels' innovative culture, market orientation, and internal marketing as forerunners of innovation capability in hotels, as well as the effect of innovation capability on hotels' performance. The proposed conceptual model is evaluated through structural equation modeling using a sample of 256 Spanish hotels. The results reveal that innovative culture by itself is not a key driver of the hotels' innovation capability. However, internal marketing and market orientation mediate the innovative culture-innovation capability relationship. Innovation capability proves to enhance hotels' market results directly and indirectly through customer equity. Our findings offer hotel managers useful guidance to understand how innovation capability is built within the firm by combining the right organizational culture and practices. Additionally, our study reinforces the financial and non-financial benefits of innovation capability in hotels.     

Does uncertain demand affect service quality?

The purpose of this article is to investigate the impact of demand uncertainty on labor intensity as well as service quality. Theoretical predictions are mixed: on the one hand, risk aversion leads hotels to choose a lower level of capital in response to demand uncertainty, thereby leading to higher labor intensity; on the other hand, the demand-enhancing benefit of service quality may be weakened due to demand uncertainty, thereby leading to a lower service quality decision. Using the data of international tourist hotels in Taiwan, this article shows that demand uncertainty leads to a positive impact on hotels’ labor intensity. In addition, hotels located in markets with a higher degree of concentration, having more diversified revenue sources, or belonging to hotel chains also tend to exhibit higher labor intensity.     

DOES BUSINESS ENVIRONMENT MATTER TO THE DEVELOPMENT OF A MARKET ORIENTATION?

Developing a market orientation is one of the key issues in market‐orientation research. In this study, based on a survey of top managers from 143 Chinese hotels and 72 travel services—two tourism sectors with distinctly different business environments—we explore the effects of environmental conditions on the development of market orientation. In particular we examine whether environmental conditions have a direct impact on the level of market orientation or whether they moderate the relationship between market orientation and its antecedents. We find that the effectiveness of top management emphasis varies under different environmental conditions but that the impact of other antecedents is not influenced by environmental conditions.     

Good but not so great: The impact of chain affiliation on guest satisfaction and guest satisfaction extremeness

Chain affiliation is widespread in the hotel industry. It has also attracted a lot of academic attention. While a large number of studies have examined whether affiliated hotels outperform independent hotels in terms of occupancy, ADR and RevPAR, research on the chain affiliation - guest satisfaction relationship is scarce. In this study, we explore the impact of chain affiliation on guest satisfaction and guest satisfaction extremeness, which is defined as the extent to which a hotel’s guest satisfaction deviates from the industry average. We also examine whether the relationships between chain affiliation, guest satisfaction and guest satisfaction extremeness are contingent on market segments. Using a large sample of 35.000 hotels, we find evidence that chain affiliation increases guest satisfaction, but decreases guest satisfaction extremeness. In addition, the positive chain affiliation - guest satisfaction relationship and the negative chain affiliation - guest satisfaction relationship are stronger in higher quality market segments. Taken together, our findings suggest that chain affiliation is a double-edged sword for hotels, particularly in higher quality market segments.     

Examination of the concept of internal labour markets in UK hotels

This article describes the results of a survey of a sample of UK hotels to gather data on various attributes of the internal labour markets, eg promotion criteria, pay differentials and the ‘openness’ of the internal labour market. The results are used to test the hypothesis that hotels exhibit strong and weak internal labour markets with an increasing level of bureaucracy perhaps being indicative of a stronger internal labour market. Overall the findings would appear to show that formal employee organization within the hotel industry is lacking and that the hotel industry is strongly dependent on the external labour market.     

Change or perish: Examining the role of human capital and dynamic marketing capabilities in the hospitality sector

Many researchers have endeavored to explain which factors contribute to sustainable competitive advantage. Toward this end, this study contributes to the marketing and hospitality management literature by providing empirical evidence on how human capital, dynamic marketing capabilities, and market dynamism influence competitive advantage in the hotel sector. We collected cross-sectional survey data from marketing and sales managers in 165 hotels, along with in-depth interviews in three hotels, based in four Gulf Cooperation Council (GCC) countries, namely, Saudi Arabia, Qatar, United Arab Emirates and Bahrain. The findings reveal that human capital directly, and indirectly through dynamic marketing capabilities, plays a critical role on developing competitive advantage. To contextualize this role, our research reveals that market dynamism moderates the mediated relationship between human capital and competitive advantage via market sensing capabilities. We discuss how the findings offer theoretical and managerial implications for the development of competitive advantage in the hotel sector.