This document deals with the fact that hotel revenue manager adjust the price of the room depending if the hotel is full or not. That means customers cannot know the price of the room. But if guests don't know what those rate-changing rules are, they tend to think of them as being unfair.
the new center of hospitality research says that hotel guests are more likely to think a rate setting practice is fair when they know how the rules work.
Taylor, who is a marketing analyst for the Venetian Resort Hotel Casino, conducted this study for his senior thesis at the Cornell School of Hotel Administration, where Kimes is the Singapore Tourism Board Distinguished Professor in Asian Hospitality Management.
“We know that hotel customers accept the idea that hotel rates will change, but we don’t know when guests will think of those rate changes as being fair,” said Kimes. “We tested three factors that we thought would influence guests’ perceptions of fairness—type of trip, amount of information, and hotel brand class, in this case either five-star or three-star. Of those three factors, only familiarity with the rate rules had a strong effect on perceptions of fairness.”
As a result of this strong indication that guests want to know the rules, Taylor and Kimes suggested that hotel revenue managers focus their efforts on increasing guests’ familiarity with their pricing practices. While this does not necessarily mean publicizing all of a hotel’s rate fences, hotels could post the conditions for a particular rate class on its website, and indicate ways for guests to lock in a particular rate (typically, by booking far in advance). In the current environment, Taylor and Kimes suggest that reservation agents and front-desk clerks can explain differential rates and their associated conditions, thus shifting the guest’s focus away from simply asking for a discount.
Download the study, “How Hotel Guests Perceive the Fairness of Differential Room Pricing,” at Cornell University
