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.     

Optimizing Room Capacity and Profitability for Hong Kong Hotels

This study estimates optimal guestroom capacity for the Hong Kong hotel industry during 2010–2013 using a single-period inventory model. Using Hong Kong hotel operational data for the period 2000–2009, we identify an issue of serious overcapacity of Hong Kong hotels for 2010–2013, the severity of which ranges from 30.6 to 40.7% above the optimal hotel guestroom counts derived from our study. We further estimate an optimal advertising budget as a percentage of total revenue (3.78%) in maximizing profitability. Attention is called for stakeholders to carefully reexamine existing and future hotel development plans and work on pushing up future room demand. The implications of our study are also discussed.     

Theoretical,empirical, and operational models in hotel location research

This paper aims to review past literature on hotel location models and evaluate the state of the art, as well as set out future directions. This study divides hotel location models into three major categories: theoretical models, empirical models, and operational models. Four theoretical hotel location models are reviewed and discussed, including the tourist-historic city model, the mono-centric model, the agglomeration model, and the multi-dimensional model. Based on previous literature, six empirical models and three operational models of hotel location are elaborated. Furthermore, some challenges related to hotel location studies are discussed, and future research directions are provided. In particular, we advocate the development of more sophisticated hotel location models and the use of Geographic Information System (GIS) in hotel location analysis.     

Guest satisfaction in independent and affiliated to chain hotels

In the hotel sector, two basic organisational forms can be distinguished, independent and chain-affiliated, which reflects in the entities' management processes and in the dimensions of the hotel service. Guest satisfaction is the determinant of and the secret to success in the hotel industry, nevertheless the comparison of customer satisfaction of both operational models is scarce. The main goal of this work is to determine whether those differences exist, considering the geographical scope and size of the chain in linked hotels. Customer satisfaction was analysed in 404 four and five-star hotels, measured through the hotel ratings from online travel agent Booking.com, in two tourism destinations in Spain using the Rasch Measurement Theory. Results obtained indicate that the superiority in customer satisfaction of one of these management forms shows for specific dimensions of the service provided.     

Assessing holiday satisfaction of Australian travellers in Vietnam: An application of the HOLSAT model

The hotel business model has been diversified in response to the various needs of consumers. Many previous studies focused on the alteration factors of the hotel business model from the consumer's point of view. Although it is one of the factors that affect alteration of the hotel business model, the manager's perspective is also an important alteration factor. This article emphasizes that it is necessary to consider not only the consumer side, but also the management side based on two approaches of the strategy theory: the positioning approach and the resource-based approach.

Surveys were conducted by mail in order to gather information regarding what managers in Japan consider to be important components of a hotel. As a result, “location” was found to be the most important component, followed by “annex facilities” and “deployment system”. Once the components were ordered according to their relative importance, a strong relationship was found between the managers' preferences and the characteristics of “syukuhakusyutai-type” hotels, which are ‘direct management’ (DM) hotels located usually in the city. In Japan, the number of “syukuhakusyutai-type” hotels has recently increased, therefore capturing the spotlight in the hotel industry. However, the results of this research are not compared with those of much previous research conducted on hotel choice attributes, because the measured variables differed significantly.     

The causality examination between demand uncertainty and hotel failure: A case study of international tourist hotels in Taiwan

The hotel business is highly sensitive to economic cycles, as the industry faces high frequency and high fluctuation of uncertainty over the demand for lodging services. Without a thorough consideration on the issue, hotels may undergo a business crisis. This research therefore investigates the influence of demand uncertainty on hotel failure by using the operation data of international tourist hotels in Taiwan during 1995–2008. The analysis applies two stages of estimation. The first stage employs a first-order autoregressive model, AR(1), to model lodging demand uncertainty. The second stage estimates the likelihood of hotels’ failure by using a logit model. The results are supportive to determine that the demand uncertainty causes hotel failures.     

Association meeting planners’ loyalty to hotel chains

Many associations alternate the location of their annual convention. Hotel chains can have a significant advantage over independent hotels in that respect due to their network of properties across the country and the consequent potential for cross selling. This study explores the relationship between association meeting planners and hotel chains, with a particular focus on loyalty issues. It investigates meeting planners’ reasons for being loyal to a specific hotel chain and their future intentions. Hotel practices, features, and benefits that planners regard as important in developing loyalty to a chain are identified. Performance ratings for these attributes are then established, and contrasted with importance ratings, highlighting opportunities for hotel chains to improve relations with loyal planners.     

Modeling a green supply chain in the hotel industry: An evolutionary game theory approach

Despite extensive discussion of environmental management for hotels, little research has been done on the hotel industry’s green supply chain management. This study uses the evolutionary game approach to examine the generation of green behaviors and a green supply chain by hotels. Results show that most hotels do have an incentive mechanism for green growth; hotels with green behaviors are more profitable than those that are not. Furthermore, governments and hotel customers are critical in the “greening” of traditional hotel supply chains. The findings can assist governments in formulating effective environmental policies, provide a theoretical avenue in governing green practice, and guide stakeholders to understand the formation and evolution of green development in the hotel industry.     

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.     

An exploratory analysis of hotel selection factors: A comprehensive survey of Tehran hotels

The selection of residence location in different countries is of high priority and significance for tourists. The selection of the most appropriate hotel entails a rather complicated decision-making process. A comprehensive hotel selection model can empower the hotel managers, the tourists, and the tourism industry to make decisions based on more effective indicators of high quality services for a higher rate of satisfaction. The purpose of this research is to deeply explore the broad literature and to identify the most significant hotel selection indicators and factors in Tehran hotels and to present a comprehensive model through an exploratory factor analysis of the extracted indicators so as to provide the managers and tourists with a firm ground for making better decisions regarding the indicators of hotel selection. Promenade and comfort, security and protection, network services, pleasure, staff and their services, news and recreational information, cleanliness and room comfort, expenditure, room facilities and car parking were identified as the main hotel selection factors of Tehran hotels. Afterwards, another factor analysis has been done in order to extract the next hidden set of factors within the aforementioned factors which return two main factors of “Hotel Comfort Factors” and “Hotel Compensatory Factors”. Following the creation of the final model and based on the intrinsic vagueness of decision making in the process of selection, a set of fuzzy membership functions for the extracted factors has been provided. The intention has been to provide the expert system and decision support system developers and users with a set of practical indicators in order to help them design and implement realistic systems based on the deeply studied indicators and factors of hotel selection. Such supportive systems can be directly presented to the tourists requesting a mechanism for selecting the most appropriate hotel but lacking enough information about the important indicators and factors and also to the managers of hotels who are trying to make strategic decisions regarding the most optimized investments on the indicators of selecting a hotel. Considering the priorities of tourists, hotel managers, entrepreneurs and investors in the hotel industry require deep investigations and studies for which this paper provides a firm basis.     

Cost Efficiency and the Choice of Operation Type: Evidence from Taiwan's International Tourist Hotels

This study investigated the endogenous relationship between the differences in cost efficiency and hotel owners' choices of either remaining an independently operated establishment or joining an international chain. We applied observations of 72 international tourist hotels in Taiwan from 1997 to 2008 to a simultaneous equations model with qualitative and limited dependent variables. The study results suggest that joining international chains significantly improves cost efficiency. We also found that net gains from improving both cost efficiency and hotel location are the two foremost determinants for an owner's decision to join an international hotel chain.     

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).     

A comparison of destinations’ impacts on hotel rates

The impact of destinations’ attributes on hotel rates in different locations has been insufficiently compared the existing literature. This study sought to apply the hedonic pricing method to measure and compare how room prices are affected by factors that are both external and inherent to hotel companies. After collecting nearly all the data regarding hotel features that consumers can use to make choices about accommodations on the TripAdvisor website, different models were developed for each city and season. The results suggest that hotels in Barcelona are more dependent on external conditions than hotels in Madrid are. In addition, hotels in both cities are more affected by external conditions during the high season. This paper discusses these and other results, as well as their implications.     

Making innovation happen through building social capital and scanning environment

Both new service development and existing service improvement are critical tools for hotels to gain competitive advantages, but pursuing new services while simultaneously improving existing services is difficult for hotel managers. The success of highly proactive hotel managers has been credited to their ability to change the environment effectively, and such managers may be able to lead hotels to resolve the trade-off dilemma and deliver better services. To elucidate the contributions of proactive managers in making innovation happen, this study explored two key activities that hotels may undertake when prompted by the proactive managers, namely, environmental scanning and social capital building. The process involved in developing new services and improving current services was examined using empirical data collected from the general managers of 226 hotels in Taiwan. The results confirm that environmental scanning and social capital fully mediate the relationship between proactive personality of managers and capacity for service innovation as well as service improvement of hotels, indicating that hotel managers with a proactive personality are helpful at implementing innovation.     

A performance evaluation model for international tourist hotels in Taiwan—An application of the relational network DEA

This research utilizes relational network data envelopment analysis to construct a model to analyze the efficiency and effectiveness of international tourist hotels (ITHs) in Taiwan. The different production processes within the hotel are evaluated, as well as the relationships between efficiency, effectiveness, and overall performance. Finally, based on the results, we recommend ways of enhancing the overall performance of the hotel industry in Taiwan.     

Marketing strategies for hotels

The aims of this article are to investigate the application of hotel marketing strategies by independent vs group (chain) hotels and to investigate comparatively the performance — along a number of criteria — of these two types of hotel organisation.The study presents in detail the main stages in developing a hotel marketing strategy and a taxonomy of the 9 major strategies available for hotels, discussing their features, characteristics and when appropriate for application.Any meaningful analysis of hotel marketing should be based on the marketing strategies employed by the individual establishment and group/chain organisation. No doubt effective selling of hotels' products and services depends to a large extent on the marketing strategies selected. As the market for hotels' services is dynamic and accompanied by rapid changes in the environment due to uncertain economic conditions, increased competition, advancement in technology, and inflation, increased attention will be given by hotels in the future to the selection of an appropriate marketing strategy.     

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.     

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.     

Attractiveness of municipalities in South-Western Poland as determinants for hotel chain investments

The selection of a location for a hotel is a decision of paramount importance, and requires a consideration prior to any investment being made. The choice of an appropriate location can meet demand, contribute to the local economy and aid guest satisfaction. This article attempts to identify the principal factors determining the location of hotels belonging to a chain. The data cover a period from 2000 to 2009 in three municipalities in the Lower Silesian, Opole and Silesian Voivodeships in Poland. The results indicate that the following factors were crucial for investors; namely, land prices, level of economic development, and the degrees of internationalization and urbanization at the site.     

Outsourcing and role stress: An empirical study of hotel spa managers

Hotel owners and managers are increasingly outsourcing their spas to specialist firms that oversee the spa's operations and personnel. In such spas the assume the role of boundary spanners as they are responsible for overseeing the operational relationship between the hotel and spa companies. In this role, they are responsible for trying to satisfy the hotel and spa companies’ often contradictory expectations while also often adhering to two sets of operating guidelines. As a result, they may experience different levels of role conflict and role ambiguity than spa managers who oversee spas managed by the hotel. The results of a questionnaire completed by 166 hotel spa managers from spas managed by hotels and those managed by third parties found greater levels of these role stressors in managers of outsourced hotel spas. Based on these findings, research suggestions and managerial implications are discussed.