The influence of e-word-of-mouth on hotel occupancy rate

Giampaolo Viglia, Roberta Minazzi, Dimitrios Buhalis

    Research output: Contribution to journalArticlepeer-review

    127 Downloads (Pure)

    Abstract

    Purpose - Online consumer reviews have become increasingly important for consumer decision-making. One of the most prominent examples is the hotel industry where consumer reviews on websites, such as Bookings.com, TripAdvisor and Venere.com, play a critical role in consumers’ choice of a hotel. There have been a number of recent studies analyzing various aspects of online reviews. The purpose of this paper is to investigate their effects in terms of hotel occupancy rates.

    Design/methodology/approach - This paper measures through regression analysis the impact of three dimensions of consumer reviews (i.e. review score, review variance and review volume) on the occupancy rates of 346 hotels located in Rome, isolating a number of other factors that might also affect demand.

    Findings - Review score is the dimension with the highest impact. The results suggest that after controlling for other variables, a one-point increase in the review score is associated to an increase in the occupancy rate by 7.5 percentage points. Regardless the review score, the number of reviews has a positive effect, but with decreasing returns, implying that the higher the number of reviews, the lower the beneficial effect in terms of occupancy rates is.

    Practical implications - The findings quantify the strong association of online reviews to occupancy rates suggesting the use of appropriate reputational management systems to increase hotel occupancy and therefore performance.

    Originality/value - A major contribution of this paper is its comprehensiveness in analyzing the relation between online consumer reviews and occupancy across a heterogeneous sample of hotels.
    Original languageEnglish
    Pages (from-to)2035-2051
    Number of pages17
    JournalInternational Journal of Contemporary Hospitality Management
    Volume28
    Issue number9
    DOIs
    Publication statusPublished - 10 Oct 2016

    Keywords

    • Hotel industry
    • EWOM
    • Online marketing
    • Pricing
    • Hotel performance
    • Occupancy rate

    Fingerprint

    Dive into the research topics of 'The influence of e-word-of-mouth on hotel occupancy rate'. Together they form a unique fingerprint.

    Cite this