Rex S. Toh

Selling rooms: hotels vs. third-party websites.

Hotels have a variety of internet distribution channels to help them sell rooms, including sites that have come to be called online travel agents (OTAs), or third-party websites, but the cost of using these intermediaries is considerable. This article examines how hotels can sell room inventory while maximizing net room revenues—chiefly, by steering customers to their own sites, rather than to the OTAs. Even though hotels want to sell rooms via their own channels, the hotel industry relies heavily on efficient and convenient OTAs to sell rooms. Based on eleven interviews (nine hotels, one third-party website, and one airline), we recommend the following ways to strengthen sales on hotels’ websites: maintain a best-rate guarantee, optimize the website for search engines, mine data from customer profiles to provide custom offers, retain premium rooms for sale on the hotel website, offer discounts or other promotions to customers who book on the hotel website, offer incentives for returning guests who book on the hotel website, avoid giving loyalty points for OTA bookings, and enrich the hotel’s website with information. Because the ability to offer low prices is a chief advantage of OTAs, many hotels have promoted price parity as one strategy for attracting customers. The results of tracking room rates of 13 hotels posted by third-party websites and hotels over a 17-week period demonstrated, however, that room rate parity is rare, even though all selling parties espouse such parity. Parity generally was found only for smaller hotels. The study also found that room rates fall as the date of arrival approaches, and it became clear that individual properties in a hotel chain follow the chain’s overall pricing strategy.

Frequent-Stayer Programs: The Demographic, Behavioral, and Attitudinal Characteristics of Hotel Steady Sleepers

This study, based on the results of a survey of hotel guests, describes the extent and operational nature of frequent-stayer programs and examines the statistical profile of hotel guests. Differential demographic, behavioral, and attitudinal characteristics of steady sleepers are provided, and some marketing implications for the hotel industry are identified.

From manual to electronic road congestion pricing: The Singapore experience and experiment

This study reviews the efforts of Singapore to curb road congestion through restraints on motor vehicle ownership as well as user fees. In particular, it traces the history of the famous Area Licensing Scheme (ALS), and then discusses its shortcomings, also the need for Electronic Road Pricing (ERP), its advantages and disadvantages and the technology involved in this state of the art system. This paper identifies important research questions to be addressed in connection with the first full-scale adoption of ERP.

Tourism and Trade: Cointegration and Granger Causality Tests:

This study uses Singapore data to examine cointegration and causal relationships between trade and tourist arrivals. This was done with respect to ASEAN, the United States, Japan, the United Kingdom, and Australia. We discovered that, contrary to the findings of others done with data from Australia, cointegration between tourism and trade exists but is not common. Granger causality is even rarer. Nevertheless, we found a strong link between business visits and imports, because businesspeople who intend to export must visit the host country. Conversely, imports encourage the exporters to visit their markets to strengthen trade ties. Business travelers appear to be selling rather than buying, because business arrivals Granger-cause imports but not exports. We also found no correlation or Granger causality within integrated trading blocks, because their integrated economies do not allow them to be treated as trading partners in the traditional sense.

Travel Planning: Searching for and Booking Hotels on the Internet

A survey of 249 leisure travelers at four hotels in Seattle, Washington, finds overwhelming use of the internet for searching and booking hotel rooms, although a noticeable percentage still make telephone calls to book rooms. Eight of ten respondents used the web for a hotel room search. Of this group, 67 percent continued online to make their booking (on either the hotel’s page or a third-party site), 26 percent made telephone calls, and the remainder used travel agents or walked in to book rooms. Earlier research indicates that the personal contacts (notably by phone) are aimed at negotiating a price lower than that found online. For those booking electronically, hotel websites were used most commonly by this group of respondents (37 percent), following by third-party sites (30 percent) and opaque auction sites (25 percent). In contrast to studies from the early 1990s, this study found that women have surpassed men in information search activities. Also, those who purchased hotel rooms online trended toward being younger, having higher incomes, and purchasing more room-nights than those who used traditional distribution channels. Although the study findings cannot be generalized because of the sampling procedure, it is clear that a substantial number of travelers use the internet for search only, and then book another way (usually by phone). Women conduct much more research regarding potential hotels and rates than do men. Hotels’ own websites remain the first choice for booking rooms, but opaque auction sites are almost as popular as regular third-party sites. For this sample, Priceline and other similar sites accounted for 25 percent of all bookings. Finally, even those travelers who did not use the internet for any purpose in connection with their hotel stay still had a relatively favorable opinion of the concept of online booking.

Hotel Room-inventory Management An Overbooking Model

Abstract The gentle art of overbooking can be augmented with a carefully constructed computer model— but human expertise will always be necessary.

A Travel Balance Approach for Examining Tourism Area Life Cycles: The Case of Singapore

This article reviews the product life cycle and its extension to the tourist area life cycle (TALC) concept and its operationalization, proposes an alternative travel balance approach (TBA) based on changes in net travel balances, and then calibrates the TALC and TBA models with tourism statistics from Singapore. Using the TBA as a preferred alternative to the TALC, the proposed model suggests that Singapore is about to enter the decline stage, based on computations of income and price elasticities of demand, as well as the level of economic development. The authors then outline the advantages of the TBA model over the TALC and conclude with the hope that their model will be empirically validated with tourism statistics from other countries.

Loyalty Programs Airlines Outdo Hotels

Compared to hotel frequent-guest programs, airline frequent-flyer programs have gained not only more membership but greater penetration of key groups of travelers, notably, business travelers and high-income, high-frequency travelers. Based on a survey of 287 guests at nine hotels in Seattle, Washington, airline loyalty programs have gained considerably greater awareness among travelers than have hotel programs. One-third of the leisure travelers in this survey reported that they were not aware of hotel loyalty programs (even though they were staying in a hotel). The study found that travelers who join both hotel and airline loyalty programs are also the most frequent travelers. By far, the proportion of travelers who join airline frequent-flyer programs exceeds that of those who have joined hotel frequent-guest programs. Perhaps most critically for hotel programs, the surveyed guests would prefer to receive airline miles for their hotel stay than to receive hotel points.

The multiplier effect: Singapore's hospitality industry

Abstract Singapores relatively high tourism multiplier makes tourism an invaluable part of that countrys economy.

Two-Stage Shift-Share Analyses of Tourism Arrivals and Arrivals by Purpose of Visit: The Singapore Experience

This article first uses the Esteban-Marquillas extension of the shift-share approach to analyze the growth of visitors to Singapore, measured against the benchmark countries of Thailand, Malaysia, and Hong Kong. Second, it modifies the extended model to analyze the growth of four of Singapore’s tourism sectors (holiday travel, business visits, business and pleasure visits, and transit stops). This two-stage shift-share approach allows the authors to determine how it is performing relative to its benchmark competitors, where Singapore’s tourism industry is specializing, and where it is competitive. The authors found that Singapore is very much like Hong Kong and is becoming less competitive relative to Thailand and Malaysia. Also, growth appears to be slower in the holiday and business and pleasure markets and faster for business visits and transit stops.