Room Revenue Research Articles

The Profitable Art of Managerial Responses to Online Reviews: A Justice-Based Investigation of Service Recovery and Firm-Level Operating Performance

ABSTRACT Building on the justice theory, managerial responses (MRs) to negative online reviews are investigated for their service recovery efficacy. MRs (>2,000) for 106 hotels were analyzed for interactional, procedural, and distributive justice and matched with their property-level room revenue, total revenue, and gross operating profit. Service recovery’s importance was empirically demonstrated via a negative association between negative reviews and performance outcomes and a positive association between MRs and performance outcomes. Justice-based MRs revealed differential impacts on performance outcomes: those with interactional justice were most effective in improving profitability. Findings further highlighted product positioning as a moderator. On one hand, interactional justice worked for lower-positioned hotels by being positively associated with total revenue. On the other hand, distributive justice backfired by being negatively associated with total revenue, suggesting that compensation in service recovery does not necessarily add value.

Utilizing Static Pricing to Boost Room Revenue in Archipelago International Indonesia Hotels Group

Purpose: This research examines the implementation of static rates to increase room revenue at Archipelago International Indonesia Hotels Group. While the majority of Archipelago International management considers that dynamic rates are more effective at increasing room revenue, the impact of global economic events such as the Covid-19 pandemic, wars, and earthquakes (force majeure) has been underestimated. Static rates can be used to respond to economic downturns induced by these occurrences, which reduce demand. Research methods: This research uses qualitative research methodologies to assess current practices and offer ideal static rate models. It is supported by three concepts and theories: static rates, room revenue, and hotel management. This research also uses tourism economy and revenue management as theoretical foundations. Results and discussion: The findings highlight suboptimal implementation challenges and propose two models at Archipelago International Indonesia Hotels Group: (1) Static Rates Stand Alone: managed by the channel manager for a minimum two-night stay, beneficial for remote or pre-opening hotels, during low occupancy or economic downturns; and (2) Bundle Packages: combining room rates with other services to increase revenue and promote additional facilities. Implication: These models provide consistent pricing, improved forecasting, and increased brand awareness. Implementing these models can help Archipelago International optimize its revenue plans and financial performance.

The curious case of Hotel King’s Cross

Learning outcomes The learning outcomes of this study are to recall the fundamental concept of revenue management in the hotel industry (remembering); explain the various performance measures used to evaluate room revenue in hotels (understanding); use revenue management strategies to improve room revenue in hotel operations (applying); and examine and evaluate the optimal solution for revenue enhancement, considering factors such as capacity management, duration control and differential pricing (analyzing). Case overview/synopsis This case study delves into the challenges faced by Hotel King’s Cross, a business hotel located in Pune, Maharashtra, in the year 2022. A week before Christmas Eve, Soham Dande, the hotel’s revenue manager, sought a meeting with Rohan Chopra, the director of sales and marketing, to discuss “revenue optimization for the hotel.” During their meeting, Dande mentioned that the hotel had fallen behind its budgeted room sales targets for 2022 across various metrics, such as room booking nights, occupancy percentage, average room rate and revenue per available room. Furthermore, the hotel was trailing behind its competitors. The situation was compounded by the management’s decision to raise the targets for 2023 by 5%–7%, factoring in upcoming events, competitive performance and pandemic-related losses over the past two years. Chopra faced the dilemma of formulating an action plan to achieve the ambitious 2023 targets and establish Hotel King’s Cross as a market leader. Complexity academic level Students undertaking executive development programs and graduate-level courses in non-profit hospitality and tourism management, as well as revenue management courses in the executive MBA, management development and graduate MBA programs, may all benefit from this case study. Supplementary materials Teaching notes are available for educators only. Subject code CSS12: Tourism and hospitality.

How Room Rates Drive Occupancy:

The occupancy rate is a key success indicator for a hotel. It reflects the extent to which rooms are sold in comparison with the total number of rooms available, measured on a daily, monthly, and annual basis. When a hotel aims to maximize room occupancy and room revenue, a well-planned marketing mix strategy is crucial, especially in terms of pricing. Setting the right price is a significant challenge for a hotel: it should not be seen as too cheap or too expensive by consumers, while still providing a profit for the company and not putting it at a disadvantage compared to competitors. Therefore, mistakes in pricing can significantly affect a hotel's occupancy rate.
 This study aims to understand the influence of room rates on occupancy at The Laguna, a Luxury Collection Resort & Spa. The data collection method in this research involves the use of secondary data about prices and occupancy rates. The data analysis techniques used include classic assumption tests, simple linear regression analysis, correlation coefficient analysis, determination coefficient analysis, and t-tests, assisted by the SPSS version 25 software program. The results of this study indicate that room pricing (X) has a significant effect on occupancy rates (Y), as evidenced by a significance value of 0.00, which is less than 0.05, and a t-value of 6.388, which is greater than the t-table value of 2.021. Based on the determination analysis results, room rates have a strong influence of 64.60% on room occupancy, while the remaining 35.40% is influenced by other factors not tested in this study, such as product, service quality, and promotion.

Examining the Effects of Online Travel Agents on Room Revenue

Purpose of the study: This study aims to determine the impact of online travel agent distribution channels on the Revenue Per Available Room (RevPAR) at Aloft Bali Seminyak over two years (2021-2022).
 Methodology: This study employs classical assumption tests, simple linear regression tests, t-tests, and coefficient of determination tests. These analyses were performed using IBM SPSS version 25 software.
 Main Findings: The study found that online travel agent distribution channels significantly influence RevPAR at Aloft Bali Seminyak. The impact, quantified at 59%, is considered strong or high, leaving 41% potentially influenced by factors not evaluated in this study.
 Applications of the study: The findings of this study are applicable in the hospitality industry, specifically to hotel operations and revenue management. Additionally, they can assist online travel agencies in understanding their influence on hotel revenues.
 Novelty/Originality of the study: This study presents novel insights into the substantial influence of online travel agent distribution channels on hotel revenue, specifically RevPAR. It advances existing knowledge by quantifying this impact and opens the door for further exploration of the remaining 41% of unexplained influence.

FAKTOR-FAKTOR YANG MEMPENGARUHI PENDAPATAN HOTEL (STUDI KASUS PASIFIC PALACE HOTEL BATAM TAHUN 2017-2021)

This research aims to find out how much the factors studied are able to influence hotel revenue from rooms that have been handled by room attendants and carried out promotions, as well as to determine the most dominant factor influencing hotel income at Pacific Palace Hotel Batam. The data analysis method used in this analysis is multiple linear regression coefficients. The variables studied that affect hotel income at Pacific Palace Hotel Batam are room cleanliness, room rates, promotion costs, and the number of rooms. This study uses interview and observation methods in obtaining data, while the data used are qualitative and quantitative data. Based on the data analysis conducted, it turns out that the cleanliness of the rooms and the number of rooms are the most dominant factors influencing hotel revenue. The room rate and promotion cost factors are not as dominant as the room cleanliness factor and the number of rooms but together they are able to influence hotel revenue which has been proven through the F test using the SPSS program. The results of this study turned out that at Pacific Palace Hotel Batam the number of rooms is the most dominating thing for existing room revenue.

Flash Sale Promotion to Increase Room Occupancy and Room Revenue at The Royal Beach Seminyak Bali

Purpose: This research aimed to describe the implementation of flash sale promotions and the contribution of flash sales to room occupancy and room revenue at The Royal Beach Seminyak Bali (TRBS). Research methods: The research uses interviews, observation, and documentation studies on the number of room nights per month data and room revenue from flash sales data for the last three years. The data analysis technique used is descriptive statistics processed with Microsoft Excel 2013. Results and discussion: Form of the implementation of the flash sale starts with a communication plan in the form of promotions that are carried out using several platforms such as websites, mobile applications, and social media. During the execution of the flash sale, the discounted price is adjusted to the guest who is an AccorHotels member and not an AccorHotels member. Implication: Implementing the flash sale promotion was quite helpful in increasing room occupancy and room revenue by contributing the third largest reservation with an average donation of 20% for room occupancy and 18% for room revenue over the last three years. Keywords: hotel, flash sale promotion, room occupancy, room revenue.

Implications of Electronic Word-of-Mouth on Hotel Profitability: An Investigation beyond Room Revenue

Interest has been growing in the financial impact of online reviews, an important form of electronic word-of-mouth (eWOM), on hotel performance. Existing research in this area is overwhelmingly focused on the relationship between online reviews and room-related revenue. For a more comprehensive understanding of online reviews’ financial impacts, this study investigates the value of these reviews relative to hotels’ non-room revenue, total revenue and gross operating profit (GOP). To the authors’ best knowledge, this study is the first to link hotels’ online reviews or any form of eWOM to GOP, a firm-level outcome. A panel dataset comprising the annual operating performance of 104 hotels in Asia was assembled and matched with 50,732 TripAdvisor reviews. Analyses indicated that review valence, variance and volume correlated to varying degrees with hotels’ GOP but demonstrated limited association with non-room revenue. Our findings also indicated that online reviews more strongly influenced room revenue and total revenue than non-room revenue and GOP. Overall, the positive effects associated with room revenue demonstrated selective generalizability to GOP. This in turn reflects the insufficiency of relying solely on room revenue indicators (i.e. average daily rate, occupancy and revenue per available room) to fully understand the impact of online reviews.

PENINGKATAN PENJUALAN MAIN COURSE MENU PADA PREGO RESTAURANT THE WESTIN RESORT NUSA DUA – BALI (PENDEKATAN MENU ENGINEERING)

Along with the development of the number of tourist visits, also grows various stars hotels in Bali which causes room revenue is no longer the only large income for the hotel so that there is a need for additional sources of income for the hotel, which is restaurants. This research aims to determine the menu mix and contribution margin, and to find out the menu classification also the efforts made to increase sales volume. This research used analysis method with menu engineering approach. This analysis approach used to assess the popularity and profit of a menu item. The results of this research show 32% of the menu included in the “stars” category, 36% of the menu included in the “plowhorses” category, 4% of the menu included in the “puzzles” category, and 28% of the menu included in the “dogs” category. So, the efforts that should be made such as: maintaining the quality, reducing the portion of the menu, menu placement, up to the menu name change.

Implementation of Advertising and Telemarketing to Increase Room Revenue

Purpose: This study was conducted to determine the application of advertising and telemarketing by a 4-star hotel located in Payangan, Gianyar, Bali, Indonesia and their effect on increasing room revenue.
 Research methods: Data collection techniques used are observation, interviews and documentation. The data analysis technique used is multiple regression analysis which aims to determine the magnitude of the influence of advertising and telemarketing to increase room revenue of the hotel, and processed with SPSS 25. Advertising carried out is in the form of print advertisements through brochures or flyers, newspapers, and magazines, electronic advertisements through the internet and social media, as well as special advertisements.
 Findings: Based on the results of SPSS 25 calculations on multiple determination analysis, it is known that the coefficient of determination is 66.6%, which means that the contribution of advertising (X1) and telemarketing (X2) variables is 66.6% to the rise and fall of room income at the hotel. While the remaining 33.4% is influenced by other factors not included in this study.
 Implication: Partially or simultaneously, the two independent variables have a positive effect on room income.

Strategic behavior for hotel standby upgrade programs: Empirical evidence and pricing implications

AbstractMany hotels have recently started to offer room upgrades digitally after the completion of booking to replace traditional front‐desk upselling during check‐in. Quickly becoming popular for upselling the premium rooms that may otherwise go unsold, standby upgrade—an availability‐based, discounted premium room upgrade—is a prominent example. However, customers, in particular loyalty members, may become knowledgeable about standby upgrades through repeated interactions with this technology, and act strategically, that is, initially choose a standard room with the expectation of being offered a premium room discount through standby upgrades. Consequently, while enjoying the benefits of this program, hotels may face the potential cannibalization of premium sales due to such strategic behavior and need to adjust their pricing accordingly. Using a major hotel chain's 16‐month booking and standby upgrades data, we empirically investigate the existence and extent of strategic customers in the context of standby upgrades. After showing preliminary evidence of potential strategic behavior, we develop a maximum likelihood estimator to estimate the percentage of customers who are strategic. This estimator captures the sequential nature of customer decision‐making for standby upgrades (booking decision, clicking the standby upgrades offer, and requesting an upgrade) through a Sequential Logit Model. We find evidence of strategic behavior in three (out of eight) hotels examined. Considering both a weak‐form and a strong‐form strategic behavior, our estimates suggest that 12%–42% of the loyalty customers act strategically in these three properties. We then propose a new pricing policy to help hoteliers maximize their premium room revenues from direct bookings and standby upgrade requests. This policy recommends a discounted full price, but also a higher standby upgrade price for loyalty customers, which can bring a revenue improvement of up to 19% over a policy ignoring the strategic behavior and 34% over a policy assuming that all customers are strategic—two reasonable benchmarks without an estimate of the fraction of strategic customers. Our research, thus, provides insights for technology managers on the potential customer behavioral challenges that a hotel may face with the adoption of a disruptive digital technology, and how existing policies may need to be adjusted for the technology to be successful.

THE IMPACT OF COVID-19 ON TOURIST HOTEL PERFORMANCE AND TOURISM DEMAND: EMPIRICAL EVIDENCE USING POPULATION-BASED ADMINISTRATIVE DATA FROM TAIWAN

This paper examines the impact of COVID-19 on tourist hotel performance and tourism demand in Taiwan. We use population-based administrative data on tourist hotels and visits with official records of COVID-19 cases to estimate the effect of the disease on the industry. Results show that a 1% increase in the number of confirmed cases of COVID-19 decreased the total revenues, and the room revenues and food and beverage revenues of tourist hotels by 0.33%, 0.47% and 0.26%, respectively. Moreover, the impact of COVID-19 is heterogeneously distributed among tourist hotels of different quality. With respect to mechanism behind the negative effect of COVID-19 on tourist hotel performance, decreases in tourism demand is a driving factor. We find that a 1% increase in the number of confirmed cases of COVID-19 reduces the number of tourist visits by 0.10%.

Analysis of the effect of the promotion mix on room revenue at the Malang Tidar Tourism Hotel

The purpose of this research is to determine the effect of the promotion mix on room revenue and to find out which promotion mix has the most dominant effect on room revenue. This research is expected to be useful for the authors, the Hotel Wisata Tidar, and other competent parties. The results showed that only the personal selling variable had a very significant effect on room income, while the advertising variable had a less significant effect on room income, so this variable was omitted (due to multicollinearity symptoms). The development of Indonesia's tourism world continues to increase from time to time which can be seen from indications of an increasing number of tourists visiting tourist destinations in Indonesia, which are famous for their natural beauty, friendliness of the people, and cultural diversity. Along with these developments, many hotel businesses that provide lodging services and other supporting services have sprung up. Hotel Wisata Tidar as one of the hotels in the city of Malang, also takes part in the development of the hospitality business in Indonesia. In carrying out its operations, Hotel Wisata Tidar also tries to compete as optimally as possible, even though it is still a newcomer. In an effort to promote itself, Hotel Wisata Tidar uses 2 (two) promotional mix media, namely: advertising and personal selling. Based on the above, to find out how far the effectiveness of promotional activities carried out in relation to room revenue earned, this research was conducted. The variables used in this study consisted of 2 (two) variables, namely: the independent variable (advertising and personal selling) and the dependent variable (room income).

Price Sensitivity Measurement: A Yield Management Approach

The purpose of this paper is to investigate and identify the potential revenue losses, at price points determined by price sensitivity measurement, between actual revenue and potential revenue that can be gained, in terms of yield management. A case study was carried out in a 5 star hotel business in Aydın, Turkey. In the study, a questionnaire was conducted to determine price resistance levels, price threshold limits, price sensitivity levels and price perceptions based on the room quality perceptions of the tourists visiting the hotel business. Also, an interview was performed with the accounting manager and the front office manager about the room prices determined. Hotel businesses can determine the optimal price by depending on the quality and value perception of the customers; thus they can use their limited capacity more efficiently so that they can maximize yield. This study showed that the hotel business lost room revenue at all points calculated. The hotel business suffered a potential loss of 35-40% because of the high occupancy rate in July and August. The hotel industry could have room sales revenues much more than the actual room sales revenues, especially if the agency commission expenses can be reduced.

Cloud Based Property Management System in Integration with IoT

Cloud based Property Management System (CPMS) is one of the best data management software that assist in managing the hospitality sector by undertaking reservations, providing discount allocation and handling capacity management for generating revenue, it also assist in gaining the loyalty of guest by communicating with sensors for guest security and comfort using Internet of Things (IoT). Nevertheless the knowledge of employees by being as source of information in hotel Industry, CPMS stores the data in a cloud server in order to keep this data safe. The main objective of this study is to find the association between CPMS with IoT for business and trust perspective. Secondly it focuses on the deployment of sensors and actuators in the infrastructure facilities that are integrated with Property management System (PMS) in luxury hotels, which simultaneously increases the hotel room revenue with consequent future concerns. Thus this investigation provides an effective operational decisions has to be taken by authorities on installation of cloud based PMS that can coordinate with OTA using Application Programming Interface (API) to increase the business with safety and security.

ANALISIS BIAYA BAURAN PROMOSI TERHADAP PENDAPATAN KAMAR DI GRAND MIRAGE RESORT & THALASSO BALI

Promotion is a strategy used to introduce products or services that are owned in order to increase room revenue in hotels. Grand Mirage Resort & Thalasso Bali carries out promotional activities by means of advertising, personal selling and sales promotion. However, in reality the cost of the promotional mix and room income do not go hand in hand, so the main point of this research is how the effect of the promotional mix costs on room income at Grand Mirage Resort & Thalasso Bali and the purpose of this study is to find out how the effect of the promotional mix costs in the form of advertising costs, personal costs selling and sales promotion costs to room revenue at Grand Mirage Resort & Thalasso Bali. The data analysis technique used in this research uses descriptive quantitative analysis techniques through classical assumption analysis methods, multiple regression analysis, t test, f test and the coefficient of determination. The results of the t test indicate that partially the advertising cost variable has a significant effect on room income. Based on the F test, advertising costs, personal selling costs, and sales promotion costs simultaneously have a significant effect on room revenue. Based on the results of the analysis, the variable advertising costs, personal selling costs, and sales promotion costs, the advertising cost variable that has the most dominant influence on room income at Grand Mirage Resort & Thalasso Bali.

호텔업의 수입효율과 결정요인분석

The purpose of this study is to measure the revenue efficiency, and to examine the determinants in the the hotel business, In the first-stage estimation equation of the revenue function, the hotel room price and non-regular workers showed a positive (+) relationship with the revenue, while the subsidiary facility price and regular workers showed a negative (-) relationship. In the second-stage estimation of revenue inefficiency, it was found that the local room share (LRS) and the room usage rate (RU) had a positive (+) effect on the revenue efficiency, while the room revenue ratio (RRR) had a negative (-) effect. In order to improve revenue efficiency in the future, it is necessary to increase the local room share (LRS) and the room usage rates(RU), and the number of users for auxiliary facilities. In particular, in preparation for Covid 19, the convenience, comfort, and safety of hotels preferred by Korean custermers should be rechecked. In addition, hotel rooms, facilities and services will have to be reorganized.

Report on Hotel Revenue and IHG’s Improvement Plan during COVID-19

This report examines the impact of COVID-19 on hotel industries and their management adaptations through the example of an IHG brand hotel. By presenting and analyzing the hotel’s data of 2020, a trend of noticeable decrease in booking and room revenue can be found. This report also illustrates the hotel’s service improvement program, which is used to counter such decrease in its revenues.

The Impact of Conventions on Hotel Demand: Evidence from Indianapolis Using Daily Hotel Occupancy Data

This paper uses daily hotel occupancy data for the Indianapolis metro area from STR to estimate the effect of multi-day conventions on hotel demand. In addition to multi-day conventions, we hand collect data on other major events such as the Indy 500 and major sporting events. Hotel demand is an important part of the economic activity generated by multi-day events because hotel rooms are largely occupied by out-of-town guests and represent new local economic activity. We look at the effect of conventions and other large events in Indianapolis on average daily room rates, revenue per room, demand, occupancy, and total revenue. We find large and statistically significant effects for multi-day conventions on hotel demand with very little evidence of crowding out. A single day of a multi-day convention brings in approximately $928,000 in additional hotel revenue. Our findings contribute to the literature on the economic impact of large events such as conventions and sporting events that attract out-of-town visitors.

How Does the Super Bowl Affect Host City Tourism?

This paper uses a unique dataset containing more than eight years of daily data to examine the effect of the Super Bowl on hotel room rentals, rates, and room revenue in four recent host cities. The findings include (1) the net gain in rentals is considerably fewer than the gross number of rooms rented, (2) benefits are heterogeneous across cities, (3) the areas that benefit are not always those located close to stadiums, and (4) nearly 90% of hotel room revenue gained is because of increased room rates which means concerns about leakages from host cities’ regional economies are salient.