Determinants of customer loyalty and purchasing behavior for full-service and limited-service hotels

This study investigated factors that influence consumer purchasing decisions for two hotel segments: full-service and limited-service. Results from an online survey indicated that full-service hotel guests were more likely to be reward program members and be emotionally attached to their preferred brand. Price was the most important factor for limited-service guests’ purchase decisions, while both price and utility were important for full-service guests. Limited-service guests had lower switching costs, that is, they required less of a discount to switch to a non-preferred brand than full-service guests. The findings have implications for hotel pricing and marketing strategies.

► An online survey compared patrons of full-service and limited-service hotels.
► Full service guests are more often reward members and belong to higher tiers.
► Full service guests have greater commitment to their preferred brand.
► Hotel choice is influenced most strongly by price, utility, brand, and amenities.
► Limited-service guests are more susceptible to discounts offered by competitors.