An investigation of hotel room reservation : what are the diverse pricing strategies among competing hotels?

In the age of e-tourism, the Internet makes hotel room rates more transparent to customers. It is widely known that hotel room rates fluctuate frequently. However, no prior study has been conducted to investigate the pricing strategies of competing hotels. To address this deficiency, the current study examined this issue. Findings indicate that hotel room rates are low and steady during early reservation period (e.g., 2.5 months). However, during the last 10 days before the check-in date, hotel room rates fluctuate the most, indicating that hotels are currently adopting diverse pricing strategies. Results also show that the best reservation time period to obtain the best available rate is 30–20 days of advance purchase. Moreover, last-minute offers rarely exist among the investigated hotels. These findings can provide hotel managers with insights about effective pricing strategies and strategic management, enabling them to inform the customers about the best reservation time period to obtain optimal room rates.