Asymmetric preference in hotel room choice and implications on revenue management

Lorenzo Masiero, Bing Pan, Cindy Yoonjoung Heo

Research output: Contribution to journalArticle

13 Citations (Scopus)

Abstract

In selecting a hotel room, guests evaluate specific room characteristics. After their stay, these characteristics are used as reference levels in deciding which hotel room to stay in the future. According to prospect theory, the gains (i.e., upgrade or improving) and losses (i.e., downgrade or worsening) with respect to the reference level are perceived differently by individuals. In particular, losses are weighted more than gains. This research investigates the asymmetric preference in hotel room choice by performing a stated choice experiment among the guests of a hotel in Hong Kong. A mixed logit model is estimated by deriving different coefficients for improving and worsening conditions, and attribute-specific cluster analyses are performed to identify those segments with similar preferences. The results confirm the validity of reference-dependent specification in hotel room choice and provide insights for revenue managers in relation to their aim to maximize revenue for repeat guests.

Original languageEnglish (US)
Pages (from-to)18-27
Number of pages10
JournalInternational Journal of Hospitality Management
Volume56
DOIs
StatePublished - Jul 1 2016

Fingerprint

experiment
Revenue management
Asymmetric preferences
Hotels
loss
attribute
Revenue
Coefficients
Prospect theory
Mixed logit model
Choice experiment
Upgrade
Managers
Hong Kong
Stated choice

All Science Journal Classification (ASJC) codes

  • Tourism, Leisure and Hospitality Management
  • Strategy and Management

Cite this

@article{99ab478ea08344118f15899c89792740,
title = "Asymmetric preference in hotel room choice and implications on revenue management",
abstract = "In selecting a hotel room, guests evaluate specific room characteristics. After their stay, these characteristics are used as reference levels in deciding which hotel room to stay in the future. According to prospect theory, the gains (i.e., upgrade or improving) and losses (i.e., downgrade or worsening) with respect to the reference level are perceived differently by individuals. In particular, losses are weighted more than gains. This research investigates the asymmetric preference in hotel room choice by performing a stated choice experiment among the guests of a hotel in Hong Kong. A mixed logit model is estimated by deriving different coefficients for improving and worsening conditions, and attribute-specific cluster analyses are performed to identify those segments with similar preferences. The results confirm the validity of reference-dependent specification in hotel room choice and provide insights for revenue managers in relation to their aim to maximize revenue for repeat guests.",
author = "Lorenzo Masiero and Bing Pan and Heo, {Cindy Yoonjoung}",
year = "2016",
month = "7",
day = "1",
doi = "10.1016/j.ijhm.2016.03.009",
language = "English (US)",
volume = "56",
pages = "18--27",
journal = "International Journal of Hospitality Management",
issn = "0278-4319",
publisher = "Elsevier Limited",

}

Asymmetric preference in hotel room choice and implications on revenue management. / Masiero, Lorenzo; Pan, Bing; Heo, Cindy Yoonjoung.

In: International Journal of Hospitality Management, Vol. 56, 01.07.2016, p. 18-27.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Asymmetric preference in hotel room choice and implications on revenue management

AU - Masiero, Lorenzo

AU - Pan, Bing

AU - Heo, Cindy Yoonjoung

PY - 2016/7/1

Y1 - 2016/7/1

N2 - In selecting a hotel room, guests evaluate specific room characteristics. After their stay, these characteristics are used as reference levels in deciding which hotel room to stay in the future. According to prospect theory, the gains (i.e., upgrade or improving) and losses (i.e., downgrade or worsening) with respect to the reference level are perceived differently by individuals. In particular, losses are weighted more than gains. This research investigates the asymmetric preference in hotel room choice by performing a stated choice experiment among the guests of a hotel in Hong Kong. A mixed logit model is estimated by deriving different coefficients for improving and worsening conditions, and attribute-specific cluster analyses are performed to identify those segments with similar preferences. The results confirm the validity of reference-dependent specification in hotel room choice and provide insights for revenue managers in relation to their aim to maximize revenue for repeat guests.

AB - In selecting a hotel room, guests evaluate specific room characteristics. After their stay, these characteristics are used as reference levels in deciding which hotel room to stay in the future. According to prospect theory, the gains (i.e., upgrade or improving) and losses (i.e., downgrade or worsening) with respect to the reference level are perceived differently by individuals. In particular, losses are weighted more than gains. This research investigates the asymmetric preference in hotel room choice by performing a stated choice experiment among the guests of a hotel in Hong Kong. A mixed logit model is estimated by deriving different coefficients for improving and worsening conditions, and attribute-specific cluster analyses are performed to identify those segments with similar preferences. The results confirm the validity of reference-dependent specification in hotel room choice and provide insights for revenue managers in relation to their aim to maximize revenue for repeat guests.

UR - http://www.scopus.com/inward/record.url?scp=84963930749&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=84963930749&partnerID=8YFLogxK

U2 - 10.1016/j.ijhm.2016.03.009

DO - 10.1016/j.ijhm.2016.03.009

M3 - Article

AN - SCOPUS:84963930749

VL - 56

SP - 18

EP - 27

JO - International Journal of Hospitality Management

JF - International Journal of Hospitality Management

SN - 0278-4319

ER -