Reviews, Ratings and Hotels – Learning from research studies
How are reviews, ratings and pricing influencing consumer booking behavior today? There are some interesting studies about that, as you can read in the SAS hospitality industry blog in full lenght. We give you a short summary right here:
Thanks to the increase of user generated content (UGC), consumers have more information than ever before as they evaluate a hotel purchase. Here are some interesting points you can learn from new studies about the customer decision-making today (focused on leisure travel):
- Reviews are the most powerful value indicator for consumers.
- Competing on price alone is not a winning strategy.
- Good reviews are not (always) a license to charge more.
- It’s hard to overcome “bad” UGC.
- Reviews and price are the most important influencers of choice.
- Negative reviews remove you from the choice set.
- Lower price or higher ratings do not overcome the impact of negative reviews.
- Consumers only notice high ratings and rankings.
Today it is more important than ever to have a good understanding of where you sit in the market on reputation and price and to be aware of your hotel’s business strategy, before making any pricing decisions.
Only with a good reputation, you will have increased pricing power – assuming you are clearly better than the competitors in the market.
Yes, it is important to get more reviews!
Consumers “believe” the UGC more when there is more of it. Therefore, hotels should work to increase the number of reviews posted across all types of review sites.
Yes, you should respond to (negative) reviews – but you should know how:
There seemed to be a relationship such that hotels responding to negative reviews had better performance (ADR, RevPAR, Occupancy).
But still it seems that “over-responding”, or not being genuine, however, can do as much damage as the negative review itself. You should be quite careful here, more research has still to be done in this area.
Read the full article here
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