Signaling effects of branded amenities on customer-based brand equity

Abstract

ABSTRACT Hotels often use branded amenities to upgrade products. However, given the importance, branded amenities are scarcely studied as a tool to manage hotel brands. Signaling theory explains how branded amenities fit into an ingredient branding strategy for hotels. A series of ANOVA were conducted to analyze the effects of branded amenities on hotels’ customer-based brand equity (quality, image, and loyalty) using an experimental design. The results confirm that an ingredient branding strategy is beneficial for enhancing hotel brands. The effects of the ingredient branding on the CBBE vary by economy, midscale, or luxury hotel segments. Midscale hotel brands yield the most potent advantages, while luxury hotel brands offer partial benefits from the strategy. The study provides essential implications for ingredient branding practices in the hotel industry. To achieve maximum benefits of ingredient branding, hotels need enough capacity to grow and minimum levels of CBBE.