Advance booking across channels: The effects on dynamic pricing

doi:10.1016/j.tourman.2021.104341

Tourism Management

Volume 86, October 2021, 104341

https://doi.org/10.1016/j.tourman.2021.104341 Get rights and content

Under a Creative Commons license

open access

Highlights

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Ninety days in advance, OTAs undercut any other channel's price.
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Thirty days out, the rates offered by hotel websites, OTAs and GDSs are aligned.
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Hotel websites had their lowest price level on the arrival day.
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Hotel size appears to have an influence on the general effects of advance booking and channel type.

Abstract

This research analyzes the effects of advance booking and channel type on hotel rates. While this relationship has been addressed in the literature, most studies take a partial approach by focusing only on one distribution channel or one destination. This study fills this gap by analyzing the price dynamics for four channels and multiple destinations. The data set consists of 39,363 bookings for 1085 hotels over 27 consecutive months. We used two-stage least squares to solve potential endogeneity issues, and the results proved that distribution channel, hotel type and hotel size have an influence on the effect of advance booking on hotel rates. Critical managerial implications are discussed.

Graphical abstract

Keywords

Advance booking

Distribution channels

Hotel websites

OTAs

Pricing

Omnichannel

Cited by (0)

Enrique Bigne is Professor of Marketing in the Department of Marketing, School of Economics, at the University of Valencia, Spain. He chairs the Digital Marketing Research Group at the University of Valencia. His research interests are in advertising, neuromarketing, and tourism marketing destinations.

Juan Luis Nicolau is the J. Willard and Alice S. Marriott Professor of Revenue Management in the Howard Feiertag Department of Hospitality and Tourism Management in the Virginia Tech Pamplin College of Business.

Edu William is an adjunct professor (PhD) and Head of Master in Tourism Degree at University of Las Palmas de Gran Canaria. His main research focus is the digital transformation in tourism, connecting strongly with the industry through the transfer of knowledge and venture building.