Hedonic Pricing of Hotel Rooms

When analyzing the operations side of the Regal Carnation Hotel, we thought specific questions could clarify the situation. The first question we posed was “Why would the hotel offer such a low price to customers if they are trying to compete with higher end hotels on their website?” When a hotel wants all the money up front with no possibility of a refund, they’re sending a discrete yet emblematic message to the prospective consumer that would seem to be a prototypical bait-and-switch operation. Because of the remote location, customers wouldn’t be able to verify and match the value of the hotel to the perceived market. Customers commit to the hotel as soon as they set their reservations, and almost undoubtedly they are disappointed and become a subject of a unique case study.

The mission of the hotel is to cater to a professional clientele who is likely to increase the revenues of Amber Inn. These kinds of patrons do not worry about price since most of the times they are covered by the Company they work for and they tend to have a prolonged stay. The necessities of those customers are more regular than the individuals that are on a vacation trip; thus, there is no difficulty to find out what do to. For instance, internet services would suffice those on a business trip whereas those on a leisure trip would worry about entertainment such as live music. Some researchers suggested that, the publicity is unnecessary in determining which hotel to choose. Internet can be a primary factor, as a sales element such as hotels.com. I advise excluding or decreasing ad for almost 4.4 million, lowering the

4. Analysis: Open the Forte Hotel Data (Conjoint, 3 Analysis) data set in My Marketing Engineering, which has competed Steps 5 and 6 in the Tutorial for you. Follow Step 7 in the Tutorial, ((ME>XL==>Conjoint==>Run Analysis) and assess the viability of the four specific hotel concepts that Forte is exploring for the State College area. Base this evaluation on the preferences of a sample of 40 business travelers on that sheet (Exhibit 2) and the cost estimates summarized in Exhibit 3. The base cost to build each hotel room (without the attributes and options listed in Exhibit 3) is expected to be about $40,000 for a 150- to 200-room hotel, regardless of the mix of room

targeted those people who would recognize and appreciate quality lodging and not those who were seeking “cheap sleep”.  Inviting potential guests or individuals who might influence visitor hotel selection to launch parties, swim parties, cocktail parties and other planned events.  Targeting supportive hospitality businesses.  Packages that supported local businesses were developed.

Tourism plays a vital role in economic development in most countries around the world. The industry has not only direct economic impact, but also significant indirect and influential impacts. There is agreement among experts that the travel and tourism sector is the fastest growing of global economy. According to the latest UNWTO World Tourism Barometer, international tourism receipts surpass US$ 1 trillion in 2011, growing about 3.8%up from 2010 (WTO, 2012).

Noone, B. M., & Lee, C. (2011). Hotel Overbooking: The Effect of Overcompensation on Customers’ Reactions t

Hilton Hotels is one of the biggest players in the US lodging industry. It contributes to about 9% of the total rooms in US lodging market. It has presence in over 78 countries with more than 2500 hotels. Lodging industry is highly capital intensive industry, so to reduce capital expenditure Hilton Hotels opted for self-owned Hotels as well as franchising model with the real estate owners. One of the key features of lodging industry is low switching costs for customers. There is very little margin to differentiate from the major competitors in the industry which include Marriott international, IHG, Accor etc.

Another barrier for entry is the high amount of capital needed to come into the industry. In the 2013/2014 Hotel Development Cost Survey they reported that the average cost of a economy style hotel room costs $77,400, compared to a luxury hotel average around $641,00. (See table 1) Due to the high costs of quality rooms in a hotel, there is a lot of capital required to enter into the hotel industry. A lot of money is required for property, employees, and advertising to gain entrance into the industry, which provide a huge barrier of entry into the hotel industry.

The Ritz-Carlton Hotel Company operates within the upscale & luxury hotel industry. While it could be argued that Ritz-Carlton operates in the more broad and inclusive lodging industry, they offer a highly differentiated product and service and therefore find themselves operating in an exclusive industry alongside very few direct competitors, such as Four Seasons Hotels, HongKong and Shanghai Hotels, and Starwood Hotels & Resorts. Therefore when analyzing this industry I will not be including cheap hotels, motels, lodges, or inns, unless to offer potential substitutes to luxury hotels. In order to assess the attractiveness of the upscale & luxury hotel industry, an analysis of the general environment surrounding the industry must be

Chan, ESW & Wong, SCK 2006, ‘Hotel selection: when price is not the issue’, Journal of Vacation Marketing, vol. 12, no. 2, pp. 142-159, (Online Sage).

Now, in 2008, this issue is of even more importance, and less of a device to attract business from the environmentally-aware demographic.Guest involvement in a more green hotel environment has become more apparent with a recent survey in the New York Times found that 16 percent of hotel guests chose where they will stay based on the environmentally-friendly options available to them and the practices of the hotel. A 2007, New York Times article titled, “Enjoy Your Green Stay,” states that green options for hotels have become widespread so quickly because of the rising cost of energy. It should be no coincidence that

Our team chose the hotel industry in the United States for our economic analysis. The hotel business has existed since the earliest times, and has influenced the development of the economy since the founding of this country.

Tourism in France is an important activity, both for the French who choose to spend their holidays, and foreigners who come to stay. Thus, since 1990, France became the first tourist destination in the world. The tourist attraction of France is due to the large number and wide variety of points of interest, diversity of landscapes, the rich cultural and artistic heritage, the temperate climate and ease of access and transport infrastructure, but also the important equipment in the country and varied reception facilities (hotels, amusement parks...). Thus, each department is a French tourist department with several points of interest. France has a rich well known cultural heritage, favored by many sites listed as World Heritage of UNESCO. The French tourism has many different facets and positive economic impacts and France makes every effort to maintain the liveliness of this important asset.

More often than not, the reason why most hotels are costly is due to the fact

Tourism The French define tourism as "the art to satisfy the most diverse aspirations which invite man to move out of his daily universe." The Webster's dictionary defines tourism as "the guiding or managing of tourists; the promotion or encouragement of touring: the accommodation of tourists." Both definitions are apt for tourism. The private sector of tourism includes lodging, food, transportation, recreation facilities, attractions, travel agents, and tour operators. These in turn are supported by a variety of specialized services, such as research promotion and printing. In the public sector, promotion of tourism on behalf of the state or communities is a major activity. In addition, there is the infrastructure of