Evaluating the best price guarantee policy in online distribution channels : the case of Hong Kong hotels

Research output: Journal article publicationJournal articleAcademic research

Abstract

E-commerce increases information transparency and creates more price-sensitive customers. As hotels attempt to implement dynamic pricing strategies to remain competitive, maintaining rate parity across different online distribution channels has become more challenging. Consequently, numerous online travel agencies and major hotel groups have extensively adopted the best price guarantee policy. This study bridges the research gap by comparing the best price guarantee policy and room rates offered by different online channels. Empirical findings from the data collected from 123 hotels in Hong Kong and seven online travel agencies suggest that the best price guarantee varies from independent hotels to international chain hotels. Most hotels cannot deliver their promise as they maintain rate parity across channels, and claiming can be difficult under the constraints of the terms and conditions. Managerial implications are discussed, and the limitations of the study are acknowledged.
Original languageEnglish
Pages (from-to)6-10
Number of pages5
JournalInternational journal of hospitality and tourism
Volume5
Issue number1
Publication statusPublished - 2015

Cite this