Managing Status in the Hotel Industry

Abstract

Based on an examination of published material dealing with status, the authors propose that certain characteristics set some hotels apart as statusworthy properties, while others are not-even though their operations may be just as upscale and high quality. The chief points of status include the following: Status symbols must be socially desirable and scarce; people are happy to pay premiums to secure status recognition (Veblen effects), and discounting may undermine the scarcity and social desirability of a product or service; quality is important in status expression; status symbols must be recognized by a specific population, although that population may not necessarily be large; because quality and money are no longer particularly scarce, understated taste and genuineness are modern status ideals; being the original is key to status positioning; and status symbols are dynamic and change with fashion. These principles of status seem at least in part to explain the rise of Four Seasons hotels to a top-status position in their markets. The specific cases of the New York and Boston properties show an unwillingness to compromise core principles and product attributes (e.g., by discounting or curtailing food service).