Abstract
Advertisement and price cues are important sources of information that influence tourists’ service expectations, particularly in the case of newer, less-established hotels. However, it is not clear if such hotels benefit from promising more or less through their advertisements; or price high or low through their price cues. Extant research is also uncertain about the role of culture in moderating the impact of advertisement and price cues on expectations. Using an experimental setup with 218 tourists from three different countries, this study finds that a newer hotel is likely to be better off by offering more service promises through its advertising and high price cues to its prospective visitors. The results suggest that culture influences how tourists process advertising cues but has no influence on price cue influence. The study provides insights for managers on how to develop a segmentation strategy using the cultural profiles of tourists.
Highlights
Imagine for a moment that you are planning to book a hotel for your holiday
Chen and Gursoy (2000) find that the French tourists utilize proprietary communication channels such as promotional materials of hotels or airlines as principal sources of information as compared to the German tourists who uses third party communication channels such as independent travel guides. This indicates that the effects of advertisements carried out by newer hotels are likely to create a higher impact among their prospective high power distance tourists in developing service expectations
Hofstede (1985) in his study on the inter-relationship between national and organizational value systems argues that countries can be grouped based on their scores on uncertainty avoidance and power distance, and people in such groups’ exhibit similarities in their value system. He suggests that people from low uncertainty avoidance and high power distance cultures view an organization as a “family.” this study argues that such individuals tend to integrate with the organization more and rely on the marketing signals offered by such organizations largely in their decisionmaking
Summary
Imagine for a moment that you are planning to book a hotel for your holiday. It will be your first visit to the destination in question and you decide to search the internet to find a hotel for your vacation. The second objective of this study is to understand how newer hotels should manipulate their advertising (many or few promises) and price (high or low) signals to influence the service expectations of their prospective visitors based on their cultural values in the pre-purchase decision making stage. Chen and Gursoy (2000) find that the French tourists (high power distance individuals) utilize proprietary communication channels such as promotional materials (brochures) of hotels or airlines as principal sources of information as compared to the German tourists (low power distance individuals based on Hofstede’s scores) who uses third party communication channels such as independent travel guides This indicates that the effects of advertisements carried out by newer hotels are likely to create a higher impact among their prospective high power distance tourists in developing service expectations. This leads to a nonchalance attitude towards the marketing signals offered by such organizations
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