Increasing Online Hotel Bookings with the Application of Promotional Cues : A Scenario-Based Experimental Study

Abstract: Background: Promotional cues are commonly applied on online travel agency websites. The most common cues were identified to be scarcity, popularity and pricing, which are said to increase consumers’ perception of scarcity, popularity and price and following enhance consumers’ booking intention. There is an increasing interest in promotional cues’ impact on booking intention in the online booking context, however, the results are not coherent as well as previous studies have looked only into intention to book. By applying the theory of planned behavior model to measure booking intention, new theoretical insights regarding promotional cues and booking intention should be given. Furthermore, this should help hotel suppliers to increase booking intention on the own hotel’s website. Purpose: The purpose is to explain how promotional cues found on online hotel booking sites impact the relationship between (1) perceived scarcity, (2) perceived popularity, (3) perceived price and consumers’ booking intention, by using the theory of planned behavior model. Method: This study has taken a deductive approach with quantitative data collection methods. By using a between-subjects experimental design, a fictional online hotel booking scenario was created. In total, data from 379 respondents were collected with a web-based survey. Thereby, respondents were assigned to six different groups (three treatment groups and three control groups). With conducting a manipulation check, it was identified that the perceived pricing group did not show a significant difference between control group and treatment group, however, perceived scarcity and perceived popularity did. For the analysis a correlation and regression analysis were conducted. Several t tests were conducted to find significant differences between diverse variables. Conclusion: A positive moderate relationship was found between perceived scarcity and booking intention, when applying scarcity cues. Furthermore, implementing popularity cues, led also to a moderate positive relationship indicated between perceived popularity and booking intention, however, the relationship was not as strongly correlated as when applying scarcity cues. Thereby, implementing scarcity and popularity cues is an effective tool to increase bookings, however, only to a small amount. Hence, it is important to also pay attention to the other factors influencing booking intention and simply using the cues as support to increase the number of booking.