Price, reviews, ratings and the business traveler: Hotel pricing in a social world
Now that online reviews and ratings are widely available at the point of purchase, consumers have access to a new source of information to inform their purchase decisions.
Understanding how consumers use this information (alongside price) to make a purchase decision will help hoteliers better price and position their product in an increasingly competitive marketplace. This is the question that we set out to answer in a series of studies on different consumer segments in the hotel industry.
Recently, we published the results of our studies on leisure travelers, establishing that, while leisure travelers prefer to pay the lowest possible price, they do rely heavily on reviews (to a lesser extent both ratings and TripAdvisor rank) and will not select a hotel that has negative reviews, no matter how low the price.
These results reinforced the importance of paying attention not only to a hotel’s reputation and price, but also that of the competitors in the market.