An Empirical Analysis of Hotel Chain Online Pricing Strategies

Analysing the online pricing practices of hotels in Hong Kong

“…Research outcomes indicated that differences in segmentation and differential pricing did exist in hotels in the United States. Similar to this present study, O'Connor (2002O'Connor ( , 2003 checked the online prices of the top hotel brands that were published in mid-2000. Using a voice system and five online channels, the studies found that the majority of hotel brands used multiple online channels, and that most hotel companies offered multiple rates on each channel.…”

“…Having reviewed prior studies on the selection of channels (Inkpen, 1998;Law, 2000;O'Connor, 2002O'Connor, , 2003Shaw, 2002), a total of seven distribution channels were selected. In addition to the models presented in the previous section, this paper classified hotel distribution channels into the two broad classes of direct and indirect distribution channels.…”

“…However, the studies found that pricing practices were neither clear nor logical, nor was there consistency in terms of the room rates offered by the channels in the high-end market. Although the findings were of some interest, O'Connor's (2002O'Connor's ( , 2003 studies did not clarify the data collection period and only five sets of alternative dates were used for data collection. Such a small set of collected data might produce biased results, which would mean that the data cannot offer any insights about online pricing practices in general.…”

“…Hoteliers, however, do not seem to know how to apply online pricing to achieve such a goal (Enz, 2003;O'Connor (2002O'Connor ( , 2003. The increasing number of online distribution channels is making it difficult for hotels to control their inventory, even as customers consider that good deals or lower prices can be obtained from online distribution channels (Enz, 2003).…”

Do Low Price Signals Influence Online Purchases of Tourist Accommodation Services? The Moderating Role of Gender

“…First, because according to Akerlof, the Internet is a market "for lemons", in which information asymmetry hinders the assessment of purchase options and the price to be paid (Fernández, González & Prieto, 2010). Second, because hotel chains create multi-channel strategies resulting in paradoxes and contradictions between the options available for tourists in the physical and online environments, increasing consumer price sensitivity (O'Connor, 2002). Third, because consumers attempt to obtain information and signs of quality to assist them in reducing their purchase risk and to help them to make the most efficient purchase decisions (Diehl, Kornish & Lynch, 2003;Beldona, Morrison & O'Leary, 2005).…”