PRICE SENSITIVITY AND BOOKING PATTERNS: UNDERSTANDING CONSUMER PREFERENCES IN DESTINATION HOTELS

Abstract

This research explores how factors like price sensitivity, how far in advance bookings are made, seasonal trends, and discount promotions affect the way customers book hotels. By combining survey responses from 275 people with historical booking data, the study examines how strategic pricing can balance maximizing revenue and keeping customers happy. The research shows that price sensitivity is of significant effect on frequency of booking and from where one books. The price-sensitive individuals will book from OTAs and search for discount offers, whereas others who are indifferent about the prices will book from the hotels themselves and remain loyal to specific brands. However, the study also found that practices like dynamic pricing (where prices change based on demand), personalized offers, and loyalty programs can increase both revenue (as measured by RevPAR) and guest satisfaction. It underlines the significance of transparent pricing and being in good health with OTAs, providing hands-on tips for hotel managers to optimize their pricing strategies. Although the research is limited to a smaller number of participants and a geographic locality, it nevertheless provides intriguing insights into how customers act when they reserve hotels in well-known places. It further provides a foundation for more research into how pricing effects can drive customer loyalty and a hotel’s profitability in the long run.