Labelling and Differentiation Strategy in the Recreational Housing Rental Market of Rural Destinations: The French Case

Abstract

In France the rural recreational housing rental market is composed of two parts: the market for ‘non-labelled’ lodgings and the market for ‘labelled’ lodgings. Two national federations with branches in each region of France manage the labelled segment. In this article the hedonic price approach is developed (a) to assess the labelling premium in the recreational housing rental market of rural destinations in France and (b) to examine the two federations' differentiation strategies. The author uses a database for the Aveyron region for the summer season of the year 2002. The data for labelled lodgings are drawn from catalogues produced by the labelling federations, and the information for non-labelled accommodation was gathered from local tourism information brochures. The study reveals that labels are indeed valued positively by the market. The labelling premium can reach ₠129 per week in the peak season. Moreover, environmental variables (such as the population density of the commune in which the lodging is located) are the key variables of differentiation in the labelled lodgings market. The results can assist federation managers in defining labelling and pricing strategies. They also point to some new directions for public initiatives to encourage the development of this type of accommodation in rural destinations.

Keywords

rural tourism hedonic method labels service differentiation rural France

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