Host-Guest Value Co-Creation and Sustainable Innovation in Small Tourism Businesses: Evidence From Rural Destination Evolution in China

Abstract

This study investigates how host–guest interactions drive sustainable innovation in small tourism businesses (STBs) amid rural destination evolution. Grounded in the value co-creation theory and the tourism area life cycle framework, the research draws on 40 in-depth interviews and field observations (2018–2024) to explore how STBs and guests collaboratively generate innovations. This study indicates that STBs can strategically leverage host-guest interactions to navigate contemporary challenges in various stages of development. Findings highlight the pivotal role of value co-creation—encompassing co-production and value-in-use. Specifically, co-production integrates resources from STBs and guests to foster innovative operational practices, while value-in-use leverages relational dynamics to tailor context-sensitive offerings. These insights challenge passive views of resource-constrained STBs in sustainable innovation. It advances theoretical understanding of businesses’ sustainable innovation, value co-creation theory, and tourism area life cycle framework. It offers practical guidance for STBs and destination management organizations within evolving rural destinations.

Keywords

small tourism businesses sustainable innovation host-guest interactions rural tourism value co-creation theory tourism area life cycle

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