IMPACT OF REPUTATION ON REVENUE MANAGEMENT AT HOTELS
Tomofumi Uetake, Ikuko Sasaki, Akimichi Aoki
DOI: 10.35666/25662880.2017.3.235
UDC: 338.48.2[640.418:006.83](52)
Abstract: Recently, revenue management has become more common in all types of hotels, because of the rise of Online Travel Agents in Japan. Moreover, in response to the spread of the Consumer Generated Media, reputation (word of mouth) such as numerical online rating and textual online review has begun to exert a big influence on hotel conversion rate and room rate. When formulating their sales strategy, hotels must consider not only factors such as the facilities, brand, competitors, and sales channels but also their reputation. This paper examines the impact of reputation on revenue management practices at hotels using questionnaire survey and interview survey. We concluded that the reputation plays the following three roles for the hotels; (1) A indicator used to improve their facilities and services, (2) Open communication tool between customers and hotels, (3) KPI to review their sales strategy. In addition, reputation affects not only the conversion rate but also the room rate directly. Therefore, in order to implement revenue management successfully, revenue managers should regard reputation as a major KPI.
Key words: Revenue Management, Reputation, Hotel, Consumer Generated Media, Word of Mouth