New research from Expedia Group and Unabashed Research shows that independent hotels can more effectively compete with their branded counterparts with price and guest ratings carry more weight than brand value as key attributes to hotel property selection.
Unsurprisingly, the study of more than 900 general population consumers, shows that price is by far the most influential driver of hotel selection, as consumers prioritise value above all else when allocating their travel budgets. Promotions and discounts that represent a real value to the customer is an almost guaranteed way to get hotel shoppers’ attention and have them select a property, says the study.
“While consumers want the best deal on travel bookings, their individual selections ultimately reflect their values,” explains Abhijit Pal, head of research, Expedia Group. “The consumer searching for a budget accommodation will look for the best value within their constraints, while someone with more disposable income may prefer a luxury option and be willing to pay more per night, but not more than they have to.”
The research shows that guest ratings also have a strong influence on consumer selection, with a 72% chance that any consumer will value guest ratings higher than hotel brand, according to the study. In fact, it shows consumers are willing to pay more for higher guest reviews, and considerably more so than for more premium brands. Participants overall were willing to pay more for a hotel with higher guest ratings: 24% more for a 3.9 rated hotel versus a 3.4 rated hotel, and 35% more for a 4.4 rated hotel versus a 3.9 rated hotel.
“Peer, or guest, ratings have essentially levelled the playing field for independent hotels, as more potential guests seek out third party endorsements for hotel properties they are considering,” says Mr Pal. “Independent hotels today can compete on a global scale with brands because distribution and technology enable them to compete, and quality is within their control.”
The research shows that hotel brand did still carry a slight advantage over other attributes, including remodel callouts, room image and hotel ratings (stars). Premium brands showed more influence on selection, with travellers rewarding those brands with some average daily rate (ADR) premium, but not nearly to the extent that superb guest ratings do, according to the study.
A recent Cornell University report, looking at over 95,000 reviews and ratings for independent high-end properties, found that the key drivers in customer satisfaction remain service and room. It suggested that hoteliers should “focus on the operational areas that speak volumes about service and room, such as appropriately friendly service throughout the property, as well as the quality of beds and ensuring a good night’s sleep for the guest”.
Put simply, this study highlighted that “the traditional lodging service that delivers a good night’s sleep in a clean, well-functioning room, together with availability of an excellent breakfast, remains central to customer satisfaction.”
In Expedia’s study, while room image, hotel brand, star ratings, guest ratings, recently remodel tags, and price were identified as just a few of the key attributes that travellers and buyers use to select hotels, some of the lesser ranked, lower importance features still can help sway decision making when combined with strong features on other attributes.