Search

The main purpose of this study was to examine the influence of related product diversification on the competitiveness and revenue generation potential of individual hotels. For this purpose, a conceptual model was proposed for related product diversification based on a combination of revenue management and price differentiation strategies, including third-degree price differentiation, rate fencing, product versioning, product bundling, and value-based pricing. The conceptual model was empirically tested in the Jordanian hotel industry using questionnaire data covering the period 2016-2018. The data were obtained from a sample of 128 individual star-rated hotels and examined using principal component analysis followed by hierarchical multiple regression analysis. Overall, the results provided solid evidence supporting the proposed conceptual model. The results showed that the five strategies underlying the conceptual model significantly and positively affect hotel property-level competitiveness, both separately and in combination. These strategies can be merged and coordinated into two underlying interrelated strategies, namely, product nonphysical diversification and product physical diversification. Greater competitiveness (higher revenue generation potential) can be achieved when the two underlying strategies are applied jointly than when applied separately. Individual hotels that actively and jointly use these two strategies can accommodate a wide range of customers with different needs and budgets, thereby increasing their average occupancy rates, while also effectively leveraging thirdand second-degree price differentiation, thus raising their average room rates, and, ultimately, achieving higher RevPARs than their direct competitors. Based on these findings, several recommendations were formulated to improve the competitiveness and revenue generation potential of individual hotels, particularly those operating in challenging and highly competitive markets. [ABSTRACT FROM AUTHOR]

The present study aimed to investigate the revenue implications of implementing a comprehensive dynamic pricing strategy in the hotel industry. To this end, the study proposed a conceptual framework that depicts the comprehensive dynamic pricing strategy as a composite concept combining dynamic pricing and value-based pricing along with a set of supporting tactics, including fenced pricing, product versioning, opaque pricing and bundled pricing. Principal component analysis was used with multiple regression analysis to identify the main components of the comprehensive dynamic pricing strategy and verify the impact of their implementation on the revenue performance of a sample of 131 Jordanian hotels during 2014-2016. The empirical results strongly supported the hypothesis that hotels that actively implement dynamic value-based pricing strategies and their supporting tactics achieve significantly higher RevPARs than those that do not actively implement these strategies and tactics. Accordingly, a set of recommendations were proposed to help hoteliers implement the comprehensive dynamic pricing strategy effectively. [ABSTRACT FROM AUTHOR]