Ethical dilemmas as a result of the impact of revenue management on hotel guest behavior

Abstract

Hotel revenue management brings significant financial benefits, but on the other hand, it can lead to a deterioration in guest perceived fairness. Certain pricing manipulations, dynamic price optimization, and changes in reservation terms aim to maximize a hotel's financial performance. However, such practices can negatively impact the non-financial aspects of customer relationship management, such as perceived value, customer satisfaction, and loyalty. Price discrimination as one of the revenue management techniques is often closely linked to a hotel guest's perceived fairness. Additionally, inventory management techniques like capacity constraints and overbooking can have adverse effects on guest satisfaction. Hotel managers are aware of the risks associated with guest dissatisfaction and, therefore, seek to identify and define strategies to prevent and mitigate their negative consequences. The goal of this paper is to gain insight into the potential consequences of implementing revenue management techniques and emphasize the need for defining preventive measures and plans to reduce and eliminate guest dissatisfaction.

Keywords

• revenue management
• perceived fairness
• hotel guest behaviour