Travel Reference
In-Depth Information
response: A concept
W.A.N. Wan-Salman & S.M. Radzi
Faculty of Hotel and Tourism Management, Universiti Teknologi MARA, Shah Alam, Malaysia
ABSTRACT: This paper is intended to conceptualize the price fairness evaluation of the room rate
offered by the hotel distribution channels. Generally, the hotel distribution channels consist of two things,
namely the direct (hotel websites) and indirect channels (hotels'intermediaries). Apart from that, the exist-
ence of the customers' emotional response is expected to contribute to this conceptual paper. It is hoped
that this study will contribute to the hotel industry and also the customers in evaluating the room rate
through online method.
Keywords
:
Hotel distribution channels, room rate, price fairness, emotional response
1 INTRODUCTION
challenges, especially with regards to room pricing
or rates in the market (Myung, Li & Bai, 2009).
According to Lim and Hall (2008), the main issue
concerned is involving the inconsistency of the
room price offered by both direct and indirect
channels. Furthermore, the difference that exists in
terms of the room rates between both channels is
actually reflecting the same type of rooms of the
particular hotel. A few studies that had been con-
ducted on the rate inconsistency (rate disparity)
matters and the results indicated that the disparity
is still exists (Demirciftci, Cobanoglu, Beldona &
Cummings, 2010; Lim & Hall, 2008; Toh, Raven
& DeKay, 2011). Not only that, those studies that
had been done on the rate (dis) parity were looking
at the organizations' perspectives rather than the
customers as the purchasers themselves. This has
raised another issue, in which Gazzoli, Kim, and
Palakurthi (2008) highlighted that the rate dispar-
ity will lead to the negative perception by the cus-
tomers and at the same time will create the matters
concerning to the price fairness.
Studies pertaining to the price fairness in hospi-
tality industry have been done by various authors,
among them were Choi and Mattila (2009), Tay-
lor and Kimes (2010), and Heo and Lee (2011).
However, the above mentioned studies are only
reflecting the perception of the price fairness as the
outcome. Although there are few studies that had
been done beyond the fairness as an outcome, such
as customers' loyalty (Hwang & Wen, 2009), cus-
tomers' response behavior (Ahmat et al., 2011), and
behavioral intention (Kim & Mattila, 2011), so far
there were no studies pertaining to the customers'
evaluation of price fairness and emotional response
Nowadays, the development of technology, espe-
cially the internet has helped the hotel industries
promoting their facilities in their properties. In
addition, the internet has assisted the customers
in viewing the room rates and at the same time
making the room reservation easier than before.
Traditionally, the hotel room rates can be disclosed
and reserved by using telephone call, facsimile, and
even by mail. According to O'Connor (2003), the
traditional method is considered as ineffective and
sometimes costly for both parties, which are the
customers and the hotel organizations. He further
noted that since then, the price has become as an
important element in the online pricing method.
Generally, hotels had been practicing the web
based pricing in order to survive in the business.
In other words, hotels that promote the room rate
through their websites are acting as the direct
channels of distribution. Apart from that, due to
the high degree of perishability in selling the room,
hotels have also taken the alternatives promoting
their rooms through their intermediaries or also
known as indirect channels (e.g.; expedia.com,
booking.com, and, agoda.com). In addition, this
has created an option for the customers purchas-
ing a hotel room via online method regardless of
any means of distribution. As stated by Lim and
Hall (2008), online purchase is easier, faster and
more convenient to the customers especially when
they want to select for the best bargains for a hotel
room.
Despite the utilization of the indirect chan-
nels in selling the rooms, hotels encountered some
Search WWH ::
Custom Search