New Consumer Behavior: A Review of Research On eWOM and Hotels
New Consumer Behavior: A Review of Research On eWOM and Hotels
New Consumer Behavior: A Review of Research On eWOM and Hotels
a r t i c l e
i n f o
Keywords:
Electronic word-of-mouth
Online reviews
Impacts
Hotels
a b s t r a c t
This study aims to gather and analyze published articles regarding the inuence of electronic word-ofmouth (eWOM) on the hotel industry. Articles published in the last ve years appearing in six different
academically recognized journals of tourism have been reviewed in the present study. Analysis of these
articles has identied two main lines of research: review-generating factors (previous factors that cause
consumers to write reviews) and impacts of eWOM (impacts caused by online reviews) from consumer
perspective and company perspective. A summary of each studys description, methodology and main
results are outlined below, as well as an analysis of ndings.
This study also seeks to facilitate understanding and provide baseline information for future articles
related to eWOM and hotels with the intention that researchers have a snapshot of previous research
and the results achieved to date.
2013 Elsevier Ltd. All rights reserved.
1. Introduction
Advances in information technology and the introduction of
new methods of communication have led to increasingly signicant changes in consumer behavior. These changes have produced
a shift in focus in companies marketing strategies and business
administration, especially in the hotel industry.
Purchase decision processes are composed of several variables
that inuence consumer choice for certain products and services.
Customers might choose a hotel based on its location (for instance,
close to an airport, tourist location, or downtown), brand name,
various facilities (such as swimming pool, golf course, and spa and
tness center), service quality, price, loyalty program, and quality
ratings by past guests. Any or all of these would enter into the customer choice mix (Verma, 2010). Atmosphere and design could be
added to the set of variables.
One of the factors evaluated in the consumer decision-making
process is word-of-mouth (WOM), dened by Harrison-Wallker
(2001) as informal, person-to-person communication between a
perceived noncommercial communicator and a receiver regarding a
brand, a product, an organization, or a service. Dickinger and Basu
(1994) dene WOM as a volitional post-purchase communication by
consumers. Most of the studies analyze WOM as a factor that, to
a greater or lesser degree, inuences consumers in choosing products and services. Yoon and Uysal (2005) consider that WOM is one
42
II
Impacts of eWOM
I
Generating
Factors
Consumer
Perspective
Company
Perspective
43
Table 1
Review-Generating Factors.
Author(s), publication
year
Title
Description
Methodology
Main results
Critical incidents in
tourism: failure,
recovery, customer
switching, and
word-of-mouth
behaviors
Measuring guest
satisfaction and
competitive position in
the hospitality and
tourism industry
Determinants of the
intention to participate
in rm-hosted online
travel communities
and effects on
consumer behavioral
intentions
Snchez-Garca and
Currs-Prez (2011)
Building a model of
commitment for
Generation Y: An
empirical study on
e-travel retailers
44
Table 1 (Continued)
Author(s), publication
year
Title
Description
Methodology
Main results
Vacationers and
eWOM: Who Posts,
and Why, Where, and
What?
Service
Quality
Failure and
recovery
Customer
Satisfaction
Customer
Dissatisfacti
on
Helping
companies
E-wom
Helping
other
vacationers
Sense of
Community
Belonging
Prepurchase
expectations
Social
Identity
45
Table 2
Impacts of eWOM.
Author(s), publication
year
Title
Description
Methodology
Main results
Electronic
word-of-mouth in
hospitality and tourism
management
A Storytelling
Perspective on Online
Customer Reviews
Reporting Service
Failure and Recovery
Wen (2009)
Ye et al. (2009)
Small accommodation
providers and UGC web
sites: perceptions and
practices
Residents as travel
destination
information providers:
an online community
perspective
46
Table 2 (Continued)
Author(s), publication
year
Title
Description
Methodology
Main results
Verma (2010)
Customer Choice
Modeling in Hospitality
Services: A Review of
Past Research and
Discussion of Some
New Applications
Online information
search strategies: a
focus on ights and
accommodations
Helpful Reviewers in
TripAdvisor, an Online
Travel Community
Online questionnaire. A
convenience sample was
obtained from a large Las
Vegas resort hotel. A sample of
781 travelers was analyzed.
Grounded Theory (abbr.GT)
qualitative-explorative
research methodology
approach (Glaser, 1978, 1998;
Glaser and Strauss, 1967;
Strauss and Corbin, 1990).
Literature review and online
survey. Data are derived from
352 respondents belonging to
MSN groups and are analyzed
using structural equation
modeling.
Papathanassis and
Knolle (2011)
Travelers social
identication and
membership behaviors
in online travel
community
The role of
cybermediaries in
reputation building
and price premiums in
the online hotel market
Analysis of information
supplied by past guests
through the OTAs
Dickinger (2011)
The trustworthiness of
online channels for
experience- and
goal-directed search
tasks
47
Table 2 (Continued)
Author(s), publication
year
Title
Description
Methodology
Main results
Loureiro and
Kastenholz (2011)
Corporate reputation,
satisfaction, delight,
and loyalty towards
rural lodging units in
Portugal
Consumers responses
to ambivalent online
hotel reviews: The role
of perceived source
credibility and
pre-decisional
disposition
Travel planning:
searching for and
booking hotels on the
internet
Gretzel, 2010; Arsal et al., 2010; Black and Kelley, 2009; Vermeulen
and Seegers, 2009; Litvin et al., 2008).
To a greater or lesser extent, it has been observed that all the
studies consider the inuence of reviews (WOM or eWOM) in the
decision making process. Xie et al. (2011) argue that electronic
word-of-mouth (eWOM) is prevalent in todays lodging market and
has potential to inuence consumers decision making. Litvin et al.
(2008), in the same line, point out that interpersonal inuence and
word-of-mouth (WOM) are ranked as the most important information source when a consumer is making a purchase decision. These
inuences are especially important in the hospitality and tourism
industry, whose intangible products are difcult to evaluate prior
to their consumption.
Research demonstrates that valence of eWOM has a strong
impact on product valuation and purchase decisions. Vermeulen
and Seegers (2009) argue that positive as well as negative reviews
increase consumer awareness of hotels, whereas positive reviews,
in addition, improve attitudes toward hotels. They maintain that
these effects are stronger for lesser-known hotels. Their study even
suggests that positive reviews have a positive impact on consumer
behavior, whereas negative reviews have little impact, although
this does not mean that negative reviews are harmless. On the other
hand, Sparks and Browning (2011) explain that consumers seem to
be more inuenced by early negative information, especially when
48
Decision
making
process
Perceived
trustworthi
ness /
Credibility
Book
intention
Hotel
comparison
E-wom
Hotel/ Brand
Awareness
Risk
reduction
Product
acceptance
Loyalty
marketing actions on specic segments) and the possibility of generating a price premium, among others.
Ye et al. (2009) in their study showed that positive online
reviews can signicantly increase the number of bookings in a
hotel, and the variance or polarity of WOM for the reviews of a hotel
had a negative impact on the amount of online sales. The results
further suggested that a 10% improvement in reviewers rating can
increase sales by 4.4% and a 10% increase in review variance can
decrease sales by 2.8%.
Loureiro and Kastenholz (2011) argue that corporate reputation
plays a signicant role in the customers perception of service performance capability, therefore leading to a reliable representation
of the service in the customers mind. Jun et al. (2010) add that the
heterogeneity of accommodation services increases uncertainty in
decision making; therefore, individuals need to evaluate various
attributes of information and use diverse information sources (e.g.,
direct accommodation websites, destination ofcial websites, customer review websites).
Consumer behavior and new technologies lead to an increased
market transparency (Toh et al., 2011; Jun et al., 2010; Verma,
2010; Wen, 2009) that could create opportunities and risks for the
companies. Verma (2010) argues that potential market offerings
in the hospitality industry have grown increasingly complex due
in large measure to advances in information technology. This situation allows customers to compare and strategically assess the
relative costs and benets of different alternatives. In this regard,
Wen (2009) cites OConnor and Frew (2004), pointing out that close
relationships between customers and suppliers web sites can reduce
the danger of substitution and help to insure long-term protability.
He emphasizes that the essence of creating a strong relationship
bond with the customers is to consider how customers make online
purchases and what factors inuence their online purchase intentions.
Another factor highlighted by studies refers to loyalty. In customer research, the term customer loyalty is often measured by
indicators like the intention to continue buying the same product,
intention to buy more of the same product, and repeat purchase
(behavioral measures) or willingness to recommend the product to
others (attitudinal indicator, reecting product advocacy) (Loureiro
and Kastenholz, 2011). The studies indicate that eWOM can inuence loyalty. However, the degree of impact that eWOM can have
on clients who are already loyal is not evidenced, nor are the differences that can exist between impacts on loyal clients and impacts
on rst-time users of the product/service.
Fig. 4 summarizes the main impacts of eWOM from the company
perspective.
From the company perspective, the impacts of eWOM could
be classied as opportunities, because if the companies analyze
and manage these impacts properly, they can obtain competitive
advantages in their business (Dickinger, 2011; Hills and Cairncross,
2010; Ye et al., 2009). Otherwise, the companies would be affected
by the negative impact on consumers.
Analysis of this information can allow improvements in the
quality of the products/services, the identication of needs and the
implementation of new policies (Loureiro and Kastenholz, 2011;
Jun et al., 2010). The interaction that can be generated with consumers facilitates the solution of potential problems, as well as
familiarization with client proles and needs.
Positive comments can enhance the market reputation of the
company as well as the possibility of obtaining price premiums
(Yacouel and Fleischer, 2011), thereby improving results and
positioning. On the other hand, negative comments can reduce consumer interest in the products/services offered by the company,
which can affect its price competitiveness and prots.
The eWOM is a signicant source of information for companies
and increasingly inuences their marketing strategies (Jun et al.,
49
Generating
loyalty
E-wom
Customer
interactions
Response
and
recovery
Online
reputation
comparison
Focus on
target
communica
tion
Specific
Marketing
Strategies
4. Final considerations
4.1. In general
Within the lines of research established in the present study,
Review-Generating Factors and Impacts of eWOM, considered from
consumer and company perspective, studies were identied analyzing the effect of gender and age (32%) and the valence of reviews
positive, negative or neutral (64%), as well as issues related to
trustworthiness and loyalty (68%). The decision making process is
another recurring theme in the studies (64%).
Research evaluating eWOM seeks to understand behaviors and
motivations in order to respond properly to them. Normally, studies
analyze factors such as: who generates reviews, why they are generated, what motivates consumers to write reviews, what impacts
reviews have on consumers and companies and how reviews affect
results and purchase intention.
Although technology can increase the accuracy of results, some
studies lack precision considering the various variables involved,
i.e. they do not identify all the factors that motivate a hotel reservation or the weight of each factor. However, in a general way, these
studies can identify some effects on behavior according to gender, age, loyalty and trust and/or distrust of the recommendations,
among others.
In this study, it was possible to identify some relevant issues
that are highlighted because of their recurrence and importance in
the research analyzed. It should be noted that some factors may
have been studied more in depth than others, and also that several
important issues may have been found in the same article.
50
comments? What aspects contribute to the generation of comments in different nationalities?); by income level (Are there
differences in the generation of comments related to consumer
income level?), by travel types (Are there different inuences on the
generation of comments in leisure travel versus business travel?)
by category of hotels (Are there differences in the number of comments generated considering the categories of hotels?) among
others.
51
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