The Interaction Effects of Online Reviews,Brand,and Price on Consumer Hotel Booking Decision Making

Abstract

When searching and booking a hotel online, consumers are exposed to multiple cues such as customer reviews, price, and brand names. This study aims to examine the level of diagnosticity and simultaneous effects of the three important decision cues: online review, price, and brand on consumer quality evaluation and hotel booking intention. Study 1 is a randomized controlled experiment of 2 (high vs. low price) × 2 (positive vs. negative online review) × 2 (familiar vs. unknown brand). Study 2 replicates and extends study 1 by further examining the three cues’ effects on both perceived quality and booking intention, and the mediation effect of perceived quality. The results reveal three-way interaction effects of multiple cues in consumers’ decision processes and indicate that negative reviews have a dominating effect on hotel booking intention, and the level of cue diagnosticity from high to low is as follows: online review, brand familiarity, and price.