Giampaolo Viglia

The influence of e-word-of-mouth on hotel occupancy rate

Purpose Online consumer reviews have become increasingly important for consumer decision-making. One of the most prominent examples is the hotel industry where consumer reviews on websites, such as Bookings.com, TripAdvisor and Venere.com, play a critical role in consumers’ choice of a hotel. There have been a number of recent studies analyzing various aspects of online reviews. The purpose of this paper is to investigate their effects in terms of hotel occupancy rates. Design/methodology/approach This paper measures through regression analysis the impact of three dimensions of consumer reviews (i.e. review score, review variance and review volume) on the occupancy rates of 346 hotels located in Rome, isolating a number of other factors that might also affect demand. Findings Review score is the dimension with the highest impact. The results suggest that after controlling for other variables, a one-point increase in the review score is associated to an increase in the occupancy rate by 7.5 percentage points. Regardless the review score, the number of reviews has a positive effect, but with decreasing returns, implying that the higher the number of reviews, the lower the beneficial effect in terms of occupancy rates is. Practical implications The findings quantify the strong association of online reviews to occupancy rates suggesting the use of appropriate reputational management systems to increase hotel occupancy and therefore performance. Originality/value A major contribution of this paper is its comprehensiveness in analyzing the relation between online consumer reviews and occupancy across a heterogeneous sample of hotels.

Turning ideas into products: subjective well-being in co-creation

New services, like fabrication spaces, 3D printer rentals and virtual marketplaces, have made it easier for empowered consumers to co-create innovative products without almost any involvement of traditional companies. Adopting a consumer-grounded view, this work takes a step forward from the existing service literature by investigating the link between psychological motives and happiness in co-creation. Specifically, the study measures how community affiliation, personal growth and utilitarian motives are predictors of subjective well-being (SWB). The results illustrate that community affiliation and personal growth motives predict high scores of SWB, while utilitarian motives do not. In addition, empowered consumers who co-create with others are happier than consumers who create alone. This indicates that direct interactions are not only a powerful platform for service co-creation, but are also predictors of SWB. We discuss the implications for traditional companies and for decision makers regarding the benefits offered by digital fabrication services.

Entrepreneurial overconfidence and its impact upon performance

A hubris theory of entrepreneurship suggests that financial forecasts are often informed by the use of heuristic methods prone to overconfidence. While overconfidence can be advantageous during the start-up phase, it is also linked to overoptimistic forecasts, non-optimal outcomes and firm failure. This article uses a data set from 203 micro and small firms operating in North West Italy where overconfidence is measured as the difference between budget estimates and actual results for earnings before interest, taxes, depreciation and amortization (EBITDA), owner equity and borrowing costs. These measures are employed to identify the extent of overconfidence by entrepreneurs in their financial forecasts and to analyse any relationship between overconfidence and the characteristics of the entrepreneur and the firm. A probit analysis is employed to investigate any association between overconfident financial forecasts and subsequent firm failure. The results are consistent with the hypotheses, suggesting that the majority of entrepreneurs are prone to overconfident budgetary forecasts that are directly associated with firm failure. Such overconfidence is mitigated by an entrepreneur’s level of educational attainment and the use of budgetary controls.

Personal or Product Reputation? Optimizing Revenues in the Sharing Economy:

The emergence of peer-to-peer platforms, known as the sharing economy, has empowered people to market their own products and services. However, there are information asymmetries that make it difficult to evaluate the reputation of the seller a priori. This article examines how sellers have to enhance their personal reputation to optimize revenues. The study proposes a revenue model where, given a frontier that depends on the shared assets, the maximization of revenues depends on reputational factors of the person and of the product. An empirical validation of the framework has been conducted in the context of Airbnb, a popular sharing economy travel platform. The sample comprises 981 establishments across five European cities. The findings suggest the crucial importance of personal reputation along with some distinctive reputational attributes of the product itself. These results emphasize the role of trust and personal branding strategies in peer-to-peer platforms.

Beyond chemistry: The role of employee emotional competence in personalized services

Purpose This paper aims to investigate how employees’ emotional competences affect customers’ responses in the context of emotional-driven and personalized services. Specifically, it proposes a model to analyze the influence of employees’ emotional competence on rapport, trust and loyalty toward the service employee and the company. Design/methodology/approach The empirical context to validate the proposed theory is the fitness realm. The sample comprises 296 clients from fitness personal training services. Data collection was carried out by means of personal surveys in three relevant fitness clubs in the city of Barcelona (Spain). The study uses partial least squares to test and validate the proposed theoretical model. Findings Employee emotional competence (EEC) directly affects personal loyalty, trust toward the service employee and rapport. However, higher levels of emotional skills are not significantly associated with loyalty toward the company. The results also suggest that trust significantly enhances loyalty. Interestingly, high levels of rapport between the service worker and the employee could even damage the level of loyalty toward the company. Originality/value Prior research documents that emotional intelligence enhances diverse positive customer outcomes, especially in emotionally charged interactions. Nonetheless, few studies have focused on analyzing how customers’ perceptions about services employees’ emotional skills are determining their attitudes and behavioral intentions. This study provides evidence on employee’s influences on consumer behaviors and outcomes, with a specific focus on EEC. It also sheds light on the unintuitive impact of customer employee rapport on loyalty toward the company.

Information Technology in Hospitality Education

This chapter explores the disruptive effects of the most recent technological innovations on the hospitality industry. The authors analyze the educational implications of these disruptions and discuss a series of curricula enhancements to be included in the students’ offer, and they argue that these challenges be addressed through strong relations between education and industry; this cooperation should lead to the development of specialized courses that make future managers capable of leading projects. Educators must stay up to date on developments and trends and modify the contents and methods of education accordingly, integrating analytics and social media in teaching, as well as developing solid partnerships with universities around the globe to favor students’ intercultural exchanges and to improve best practices in education.

When co-creation pays: stimulating engagement to increase revenues

Purpose Customer willingness to pay (WTP) was initially set out to estimate the perceived value from a purchasing experience. However, purchasing decisions have changed as value co-creation has become increasingly applied in the hospitality industry. In adopting a service-dominant (S-D) logic lens, this paper aims to empirically test how co-creation impacts WTP through customer engagement (CE). Design/methodology/approach The context for the empirical analysis is the Chinese market, one of the largest online purchasing markets that has been significantly transformed since the proliferation of co-creation. The study is a within-design online experiment with 488 Chinese participants. The analysis makes use of mediation models to evaluate the proposed mechanisms behind co-creation, CE and the moderated role of frequency of stay, and their impacts on WTP. Findings The data confirm the hypothesised positive impact of value co-creation on customer WTP. This impact is fully mediated by CE, i.e. CE is the mechani...

Can snacking be healthy? A comparison between coeliacs and health conscious food consumers

Healthy eating is often substituted by easily accessible snack foods that are high in saturated fat, as well as salt and sugar. By uncovering consumer’s expectations towards healthy food, this work proposes the design of a new product - healthy snack bars - as an alternative to unhealthy snacks. Based on a sample of adult coeliac and health conscious people, our study breaks consumers’ expectations down into a set of themes, which represent the ideal product’s objective and subjective features. The empirical study combines two qualitative methods (free word associations and collage creation) and a questionnaire in an explorative setting to retrieve conscious and unconscious feelings of consumer’s decision making. The findings suggest that taste and social inclusion are the characteristics of an ideal healthy snack bar for coeliacs, while self-indulgence is the most salient theme for health conscious consumers. We discuss the implications of these results in terms of nutrition and development of a new product.

Correlation Between Anomalies and Theories of Mental Accounting

Several consumer choice models account for anomalies in consumption-payment decisions. We consider four models, namely, Prelec and Loewenstein 1998 double-entry model, Thaler 1985 double-comparison model, Baucells and Hwang 2014 reference price adaptation model, and Koszegi and Rabin 2006 reference dependent model. We observe that these models make distinct predictions regarding how different anomalies ought to be related or unrelated. In a controlled experiment we elicit the participants tendency towards five anomalies, namely, the sunk-cost effect, the reluctance to trade, the flat-rate bias, the preference for pre-pay, and the preference to be post-paid. The observed correlation between anomalies across individuals is consistent with the prediction of Baucells and Hwang 2014 and, to a large extent, with that of Prelec and Loewenstein 1998. The evidence is partially consistent with Thaler 1985, and we find little support for Koszegi and Rabin 2006. The results suggest that the speed of adaptation of reference prices to current price information is a key explanatory factor.