Evolution of Value Proposition in the Hotel Industry
Introduction
Over the last two decades, the hostel industry has undergone numerous transformations due to the shift in customer behavior and preferences. Today, the hotel industry no longer focuses only on attracting more guests but enhancing their experience to build customer loyalty (Baek, Choe & Ok, 2020). Players in the hotel industry have devised different ways of promising to deliver the services that customers want, which is not offered by the competitors. The promise of providing customized services is based on the need to increase customer contentment and options. This essay will analyze how the value proposition in the hostel industry has evolved and changed the guest behavior across different generations.
In response to the stiff competition in the hotel industry, players in this sector have continued to promise their customers high quality and customized services. The value propositions have focused on providing the clients with personalized services that enhance customer experience and satisfaction (Baek, Choe & Ok, 2020). The current hotel customers are not interested in the low pricing or quick service but are more concerned with establishing a long-term relationship that emanates from a wow experience. Consequently, hotels have developed value propositions that are centered on the provision of unique services. The evolution of these value propositions has changed the guest’s behavior over several generations. Today, guests continue to rate hotels using their wallets through the services and products they purchase. As they endeavor to meet the expectations of guests from different generations, hotels have continued to promise their clients personalized services whether on vacation with family or a business trip. As a result, these promises have changed the behavior of guests who now demand more personalized services from the hotels.
The promises given by hotels over the last decade have played a central role in shaping consumer behavior. For instance, the promise of free Wi-Fi and other digitized guest experiences, such as apps, have changed the way guests select hotels when on a business trip or just on vacation. In other words, the adoption of information technology in the hotel industry has changed the way guests have behaved in the last several years. Promising to offer a digitized guest experience does not only result in customer satisfaction but also enables the hotel to manage many aspects of the guest cycle and experience (Morosan, & DeFranco, 2016). The rapid advancement in technology has driven hotels into adopting internet-enabled business models. Today, many hotels post their products and services on online platforms such as social media. Unlike in the past, guests today access the internet and choose the hotel that seems to provide the kind of services that they want or desire.
Using mobile devices, a guest can research, book, check-in, and order services from the hotel (Morosan, & DeFranco, 2016). The evolution of value propositions through the adoption of technologies has resulted in an increased demand for the digital guest experience. Through information technology, customers have increased their awareness of the various services and products offered by different hotels. Today’s consumer expects better services and amenities at a lower price, which hotels package in their value propositions. The promise by hotels to offer better services and amenities such as free Wi-Fi has increased demand for these services (Akbar & Tracogna, 2018). Guests have changed their consumption habits to match the promises made by the hotels. In the last 20 years, several hotels have embraced the “select-service hotel” model, which provides all the services and amenities desired by the customer. The adoption of this model has changed consumer habits because fewer clients today require room-based services because they avoid incurring additional costs. A change in the dining habits of the consumers occurred at the same time as the shift from the full service to the select-hotel service. According to Baek, Choe & Ok (2020), the select-hotel service properties have become the most preferred destination for high-end guests because they provide all the desired services and amenities.
The entry of technology-based companies such as Airbnb in the hotel industry has changed the guest’s behavior (Bashir & Verma, 2016). Through Airbnb, potential customers access and book a distinct hotel destination that provides the kind of services that are not offered by the traditional hotels. Airbnb has disrupted the hotel industry resulting in an unprecedented increase in competition. Airbnb enables facility owners to let out their unoccupied spaces to travelers in different countries in the world. Today, many people either on business or vacation use Airbnb to identify distinct locations that give them a wow experience. The entry of Airbnb coupled with the availability of virtual communities, such as social networks, has played a critical role in shaping customer behavior. Guests can know the services offered by different hotels by visiting various social media platforms.
Conclusion
The players in the hotel industry have made numerous value propositions aimed at attracting more guests and beating the completion. The promises made have centered on providing additional amenities that enhance customer satisfaction and a wow experience to the guests. These promises have changed consumer habits resulting in more guests demanding personalized services that meet their expectations. Hotels have continued to promise extra services and amenities that are not offered by their competitors in the industry. Adoption information technology platforms such as social media and the internet have enhanced the customers’ awareness of the various services offered by hotels. Overall, the behaviors of today’s guests have changed due to the various promises made by hotels that focus on offering the best customer experience and contentment.
References
Akbar, Y. H., & Tracogna, A. (2018). The sharing economy and the future of the hotel industry: Transaction cost theory and platform economics. International Journal of Hospitality Management, 71, 91-101.
Baek, J., Choe, Y., & Ok, C. M. (2020). Determinants of hotel guests’ service experiences: an examination of differences between lifestyle and traditional hotels. Journal of Hospitality Marketing & Management, 29(1), 88-105.
Bashir, M., & Verma, R. (2016). Airbnb disruptive business model innovation: Assessing the impact on the hotel industry. International Journal of Applied Business and Economic Research, 14(4), 2595-2604.
Morosan, C., & DeFranco, A. (2016). Co-creating value in hotels using mobile devices: A conceptual model with empirical validation. International Journal of Hospitality Management, 52, 131-142.