Sanghoon Cho is Assistant Professor of Business Analytics, Texas Christian University, USA.
Our findings can provide hoteliers with new insights on the effect of online reviews and review sentiment on hotel demand and serve as a valuable resource when incorporating the effects of their own and their competitors’ reviews into pricing strategies and other marketing activities.
Pelin Pekgün is Dean’s Fellow and Associate Professor of Management Science, University of South Carolina, USA.
Additionally, if the hotel’s prices are perceived as high, they may see a larger drop in bookings as a result of more negative reviews or its competitors’ more positive reviews. Hotel managers must evaluate their review scores in conjunction with their prices and incorporate review scores into their marketing strategies. Although most hotel chains employ sophisticated dynamic pricing, we are seeing some initial movement toward incorporating nonprice data into pricing decisions. Our study provides empirical evidence to support the significance of the interplay between reviews and prices, and it shows that this might change by consumer segment and review content.
Ramkumar Janakiraman is Professor of Marketing and Distinguished Moore Fellow, University of South Carolina, USA.