An Alternative Hotel Pricing Technology: Hedonic Price Model for Pricing Beach Resort Revenue in Thailand.
Keywords:
pricing, hotel pricing technology, physical attribute, location, Thailand, hedonic price modelAbstract
Two classical methods for pricing the average daily rate (ADR), ADR Rule of Thumb Method and Discounted Cash Flow Analysis Method have some limitations. The aim of this research is to find the determinants of average room revenue and to propose an average daily rate prediction model of beach resorts in Thailand using a hedonic price method, as an alternative pricing technology. Three groups of independent variables are identified from a literature reviews and verified by experts: resort rating, physical attributes, and location attributes. Average daily rate is the dependent variable of the prediction model. The study finds that a log–log multiple regression model with 11 determinants is the best prediction model and the variables with highest effect on average daily rate are, in descending order, star rating, being located on Samui or Phuket Islands, spa availability, and international brand availability. The research findings are useful for investors or developers, government authorities, and academics.
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