Open AccessThe impact of family business strategies on hotel room prices
Author(s) -
Ismael P. Soler,
Germán Gémar
Publication year - 2016
Publication title -
european journal of family business
Language(s) - English
Resource type - Journals
eISSN - 2444-8788
pISSN - 2444-877X
DOI - 10.24310/ejfbejfb.v6i1.5047
Subject(s) - profitability index , family business , business , marketing , cost leadership , investment (military) , empirical research , hotel industry , finance , tourism , competitive advantage , philosophy , epistemology , politics , political science , law
This paper seeks to address the lack of empirical research on family businesses in the Spanish hotel industry. Through a hedonic price model applied to Malaga hotels, this study assessed the impact on hotel room prices of whether or not a hotel is a family business. The results show that, when being a family-business hotel is considered, this has a negative impact on prices of about €10. The results are discussed based on a combined approach of profitability, brand and price strategies, which offers several ways to interpret the research outcomes. A first option is that Malaga family businesses follow a strategy of cost leadership. The second option is heavy brand investment by Malaga family hotels. Another option is that customers consider the family hotels of this destination unprofessional compared with non-family hotels.