Industry Update
Opinion Article30 September 2016

Do hotel managers’ responses to TripAdvisor reviews boost revenue? It depends.

By Karen Xie, Professor at Daniels College of Business

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New research from the University of Denver's Daniels College of Business finds that hotel managers can improve their revenue per available room when they respond to online reviews on TripAdvisor, but specifics are critical. The research, "Monetizing Managerial Responses on TripAdvisor: Performance Implications across Hotel Classes," is forthcoming in Cornell Hospitality Quarterly.

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"Above-average and luxury hotels in particular benefit from managerial responses in longer length and provided by frontline managers," says Karen Xie, assistant professor of hospitality management at DU's Knoebel School of Hospitality Management. "Our research showed that full-service, midmarket economy and budget traveler hotels benefit from executives' responses. In addition, the speed of responses is important for full service and above-average hotels, and conciseness of responses is critical to budget traveler hotels."

The researchers analyzed 7,979 managerial responses and 51,801 online reviews on TripAdvisor, which were matched with the financial performance data (revenue per available room) for 2,652 hotels in 427 cities in Texas over 26 consecutive quarters from 2005 and 2011. Their advice is summarized in this chart:

"This study provided important yet specific implications on how hotels can benefit from different types of managerial response strategies according to their product characteristics (i.e., hotel class)," Xie says. Xie's co-authors are Linchi Kwok, assistant professor at the Collins College of Hospitality Management at California State Polytechnic University, Pomona, and Wei Wang, assistant professor of information management at Huaqiao University in Quanzhou, China.

Karen Xie

Karen Xie is an assistant professor at the Fritz Knoebel School of Hospitality Management, Daniels College of Business. Her research/teaching interests focus on the use of technology and data analytics to solve business problems. Her recent research projects examine business strategies enabled by technology, innovations of sharing economy platforms, managerial intervention in social media, and digital marketing and customer conversion using large-scale but granular data.

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