The heavily fragmented hotel industry, embracing the changes in their guests’ use of electronic devices, has spent considerable resources to incorporate electronic commerce (e-commerce) practices. The extant literature offers inconclusive findings with regard to the effect of e-commerce on firm performance, especially when firm size is considered. Given the high fragmentation of size in the hotel industry, understanding its role in the deployment of e-commerce could result in substantial benefits for both hotel firms and consumers. Using the financial performance of 689 observations of over 110 hotels during 2007–2012, this study finds that e-commerce expenses positively impact firm performance, and that firm size moderates the relationship between e-commerce expenses and firm performance.
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