Consumers' hotel choice: revising the role of online user-generated ratings

Abstract

With the advent of Web 2.0 and rapid growth of Tourism 2.0 applications, today travellers have access to an enormous volume of online user-generated content in the form of user reviews and ratings for nearly every single commercial travel accommodation facility around the world. Annually millions of travellers read these reviews and check the ratings before selecting hotels. This phenomenon has had revolutionary impacts on the hotel market dynamics as well as travellers’ behaviour in choosing travel accommodation. Constructed based on a pragmatic research philosophy and through a combination of a series of interrelated conceptual and empirical inquiries, this study provides a new multidimensional perspective towards expanding the boundaries of our academic understanding of the nature, mechanism and magnitude of the impact of eWOM on consumers’ choice of hotels. This study provides eTourism academia with a range of significant conceptual and empirical contributions. From a conceptual perspective, this study provides a synthesis of a wide range of academic research in this field and proposes a conceptual framework for multiple cognitive, affective and normative impacts of eWOM on consumers’ choice of hotels. Furthermore, the empirical component of this thesis constitutes a multi-attribute, discrete hotel choice experiment constructed based on a careful analysis of the realistic distribution of hotel attributes in a specific market. Using a pairwise-comparison experiment design conducted based on the PAPRIKA method, this study provides empirical evidence for the impact of even fractional variations of UGC ratings on consumers’ choice of hotels. However, the comparison of the magnitude of the impact of UGC ratings vis-à-vis other attributes suggests that location and price rates may have a relatively stronger magnitude of impact on the hotel choices of an average consumer. The conceptual and empirical contributions of this study bridge part of the gap in our current academic understanding of the magnitude and nature of the impact of eWOM on consumers’ choice of hotels and highlight some important pathways for further academic inquiry in this field. Furthermore, the empirical results of this thesis assist hotel industry stakeholders in devising more effective pricing, revenue management and market segmentation and positioning strategies.