The Relationship of Sales and Marketing Expenses to Hotel Performance in the United States

Abstract

While hotel organizations are investing considerable sums of money for marketing at the unit level, research investigating the relative benefits of the different areas where those funds can be invested is lacking. This exploratory study endeavors to fill that void. Since different types of hotels have differing operating characteristics, this study examines marketing expenditures for various hotel tiers, using the Smith Travel Research chain scale categorizations. The study finds that marketing expenditures have differential effects according to the type of hotel and the particular type of marketing expenditure. These analyses explore implications of various types of marketing expenses on both hotel unit revenue and profitability.