Pushing Value in the Hotel Industry

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Introduction Hospitality industry is a fluctuating industry. One of the reasons is that because it is an industry that depends highly in seasonality period (Font, Penalva & Sampol, 2011). Seasonality according to Butler cited in Weidner (2006) is “the temporal imbalance in the phenomenon in tourism”. In hospitality industry, seasonality can be illustrated as in a period of time, hotels will be facing its peak season where there will be high occupancy and in another period of time, it will face low season where there will be lower occupancy. The hospitality industry also fluctuates as the result of global economic crisis (Kapiki, 2012). The financial crisis in 2008 could be one of the examples that can serve as a significant reason why hotels manager should always be ready and able to find a way to maintain the hotel business during tough economy times. After the economic slowdown in 2008, it was recorded that the average hotel room rate around the world was 14% cheaper in 2009 than the room rate in 2008 (Kapiki, 2012). This has later caused a decrease in the revenue earned by many hotels. Although lowering the price of the rooms can attract guests to book the room during the tough economic times, it is not an efficient strategy to be implemented in long term. Many strategies can be implemented for hotels to sustain its business and there are seven strategies proposed in the case study for hoteliers to apply during the economic crisis. “Pushing value instead of lowering price” is selected to be evaluated further in this study. Price Price, according to Oxford Dictionaries (2014), is the amount of money paid or given to obtain certain products. Products, in this case, include both goods and services (). In hospitality industry, pr... ... middle of paper ... ...fluences in the European Hospitality Industry. A Case Study of A Four Star Hotel in Spain, Germany and England” MA European Tourism Management. http://www.du.se/pagefiles/5053/vosslawrence.pdf‎ [accessed 26 April 2014]. Wagner, N. (2014) ‘The Advantages of Word-of-Mouth Marketing’ Chron. http://work.chron.com/advantages-wordofmouth-marketing-3567.html [accessed 25 April 2014]. Weidner,S. (2006) ‘Seasonality in Tourism: A Review of Seasonality of Hotel Accommodation in New Zealand’ Grin. http://www.grin.com/en/e-book/122991/seasonality-in-tourism-a-review-of-seasonality-of-hotel-accomodation-in [accessed 29 April 2014]. Wilkening, D. (2009) ‘Add Value, Don’t Lower Rate’ Hotel Interactive. http://www.hotelinteractive.com/article.aspx?articleid=14405 [accessed 6 April 2014]. Williams, C., et al. (2003) Service Quality in Leisure and Tourism. Buswell Wallingford: CABI.

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