A project report on

Analysis of Online Reviews for Hotel and

Vacation Booking

Submitted by

RITIK

Maharaja Agrasen Institute of Technology,

Sec-22 Rohini, New Delhi – 126102
 Introduction

With the rapid development of information technology in hotel booking context, it’s no doubt that
several hotels consequently enhance the needs of integrating information technologies into their
overall business operations. A good example of combination of IT and business operations in
overall hotel industry would be third-party online hotel booking sites. Prior to the emergence of
third-party online hotel booking sites, consumers would have to directly contact a department of
hotel reservation by phone. However, the emergence of third-party booking sites
(makemytrip.com, Booking.com, TripAdvisor, Trivago etc.) give consumers various options
before making a reservation. As third-party online booking sites have become sophisticated, they
have been transformed into a range of mobile platforms such as on smart phones (Android, iPhone,
Blackberry, etc.) or tablet PC (iPad, etc.). For example, consumers can use mobile devices to book
accommodation using mobile apps via a smart phone. The mobile platform has made hotel booking
much easier, since the booking is completed on third-party online booking sites itself and users are
not redirected to a hotel’s website. Thus, an improved mobile experience for hotel booking
enhances value for the consumers and increases online bookings. The online users review about
goods and services have become more important because they influence on other consumers and
are a very important information source for decision support. The user control can provide an
experience of empowerment and an enriched sense of satisfaction with the outcome of choice.
Consequently, the current project sought to contribute to the field of knowledge by discovering
and quantifying the impact of online reviews on hotel and vacation bookings.

The aim of the project is to understand and analyze online reviews, what motivates an individual
to book a hotel and the key factors that help in deciding which hotel to choose. We will also be
taking a look at what impact does online reviews have on the individual’s intention to make a
booking and which online booking site they trust the most.
 Methodology

For this project, I performed an online survey to analyze online reviews. The online survey
consisted of questions from prior studies which have proven their validity and reliability. The
current project features a sample of responses collected via google forms. The relevant information
from the survey broadly includes -
• how often reviews are posted online
• how does online reviews influence the customers decision making
• hotel ratings and factors while making a reservation
• online travel/hotel booking site used most

Most of the questions were anchored on a five-point Likert-type format, and respondents rated
from 1 (strongly disagree) to 5 (strongly agree). Some questions, the respondent had to choose
from multiple options as per their choice. The survey contained 13 questions and by voluntarily
participating in the study, respondents were notified via mobile or email message that contained
participation instruction and a hyperlink to access the online survey.

A total of 75 respondents participated, and this study finally obtained 74 valid questionnaires after
eliminating problematic answers. The collected data consisted of 73% male and 27% female respondents
aged 18–74 years old, with average age of 24.45 years.
Also as shown in figure below, 44.6% respondents had either no booking experience or make just
a single booking/year. Respondents with more than one online booking experience amount to
55.4% in total of which 41.9% make 2-4 bookings/year, 8.1% make 5-6 bookings/year and 5.4%
made more than 6 bookings/year.
 Results and Analysis

After having implemented the above methodology, we have got the following results of our survey
that was conducted –
According to the primary research, we can see that only 18.9% people claim to write online reviews
of their hotel vacations stays. The rest of the respondents either didn’t write reviews of their stay
(36.5%) or sporadically wrote them (44.6%). On further questioning the respondents on how often
they write online reviews of their stays/visits/vacation, we can see that 32.4% people don’t write
online reviews of their stays/visits/vacation and using weighted average, the rating came out to be
2.28 which is in line with the secondary research that people rarely write online reviews of their
stays/visits/vacation.

Now on to the next part of the project where we will be analyzing the role of online reviews in a
customer’s decision making of making a reservation for their hotel stay/vacation.
With the help of secondary research, we identified the three KPIs which would have most
affected consumer perception. These are number of online reviews, accessibility of reviews, and
credibility of reviews. We asked the general public to rank them in order for their perception with
5 being the best and 1 the worst. With the help of weighted average, we found out that although
the public was divided over their views on different KPIs, Credibility of reviews was calculated to
be the most significant KPI followed by accessibility and number of reviews.

On the basis of the above parameters, we have analyzed that 59.5% respondents strongly agreed
that the do look at online reviews before making a booking. Only 2.7% respondents choose that
they didn’t take a look at online reviews, thereby showing that maximum number of people do
look at online reviews before making their bookings.

Similarly, majority of the respondents (89.1%) were either likely (45.9%) or very likely (43.2%)
to make a booking if the hotel/place has positive reviews and is being promoted well and
recommended by other tourists as well. This suggests that positive reviews play a major role in the
decision making of the customer.
Keeping up with the trend shown above, the maximum respondents (81%) were either likely
(37.2%) or very likely (43.2%) to make a booking if the hotel/place has a greater number of
reviews. Hence, a greater number of reviews, greater the chance of booking that place/hotel.

Hotel ratings also play an important role in making a customer to decide to book a specific hotel. It can be
seen that even though if a hotel has a higher rating, the negative reviews do impact the bookings made as
only 4.1% of the respondents will be booking a hotel. Also, it can be seen that 44.6% of the respondents
had a neutral stand, i.e., they either do not read online reviews or weren’t impacted by the negative reviews
due to the hotel’s brand name and high rating

Along with brand value and high ratings, Price, Location and Hotel Rooms are also some of the
key factors that consumers look at while making a booking. From the figure below it can be seen
that majority of the respondents choose Price (90.5%), followed by Location (85.1%), followed
by Good Ratings(83.8%) and Hotel Rooms (78.4%).
Hence, it can be said that Price, Location and the quality of rooms provided by the Hotels go hand
in hand with the Hotel’s good rating.
Now, moving on the last but the most important aspect of online reviews; the online travel sites
and how much the customers trust them.
The results from the survey shown below, we can see that majority of the respondents prefer using
MakeMyTrip (84.9%) followed by Goibibo (43.8%) at a distant second. Trivago is the third most
preferred site (41.1%) with Booking.com at fourth (37%). The rest of the online reviews showed
a divided opinion amongst the respondents.
We can also see that even though some online travel sites were really popular amongst the
respondents, there is still an issue with how they are perceived and trusted by the respondents.
Only 23% of the respondents would choose to agree (10.8%) and strongly agree (12.2%) with
online reviews over a recommendation given to them by known ones. The weighted average of the
overall responses was 2.6, which is in line with the survey and response given by the respondents.
 Discussions and Findings

Based on our findings, this project has analyzed the subsequent research contributions. First, as
per to our results, we have found that positive online reviews play the most significant role in
online hotel booking context since an individual may book a hotel online when they perceive
benefits of more reasonable price, location and higher quality of hotel. Also, if more people start
writings online reviews of their hotel stay and vacations, it gives the consumer better perception,
a larger pool of reviews to decide from, builds trust towards the reviews posted online and also
increases the possibility of people looking at them.
We also found in this project that consumers prefer to rely on online reviews to build trust by
reducing the online uncertainty associated with intangibility about a hotel. Therefore, hotel
companies should be aware that gathering online reviews is an important determinant for gaining
customers’ trust toward hotels.
Second, we have also found that both trust toward third-party online booking sites such as
MakeMyTrip, Goibibo, Trivago etc. and trust towards hotels have had significant effects on
individuals’ intention to book. Also, while value and trust appear to be particularly important
determinants of online hotel booking, it is meaningful for hotel industry to understand the factors
that promote consumers’ booking intentions. These factors are mainly Price (discounts, deals,
value of money etc.), Location, Good ratings and the quality of Rooms within the Hotel.
Thirdly, the type of online reviews posted also has an impact on the individual’s intention of
booking a place/hotel. We found that positive reviews go a long way in making the consumer book
a place/hotel. The hotel should also try to work on the negative reviews and build on them so that
they don’t interfere with the individual’s intention to book. Also, if the hotels/places are being
recommended by the person’s friend/relative/known ones they assist in making the person to book
that certain hotel/place. Hence, the online reviews should also focus on recommendations as they
improve the individual’s overall ability to book.
 Conclusion

The project contributes to the hospitality industry and literature by providing and brief overview
of the overall impact of online review on Hotel and Vacation bookings. We have been successfully
able to finish the aim of the project and analyzed the impact of online reviews on the person’s
intention to book.
The results revealed that the number of online reviews play an important role in affecting customer
behaviour. This study established that an individual’s intention to make a booking are significantly
affected by the nature of online reviews, price, location, good ratings and quality of hotel rooms.
Additionally, recommendations and honesty are important antecedents of trust in an online review.
The study’s results also revealed that the nature of online review posted significantly affects
customer trust and customer intentions to book a hotel online. Interestingly, the results also show
that customers seem to trust a few online booking sites more than others, suggesting that brand
value and high ratings as a key factor affecting customer trust.
 Learnings during the Project

The project has been a great learning curve for me personally. Through this project I have been
able to learn and understand the basic customer needs and trends in the hotel industry. I also had
the opportunity to do literature review of various research papers based on the topic of my project.
Through this project, I also had the opportunity to conduct a survey for my project which helped
me to study the topic in depth and gather the views of various other people. I also gained
knowledge about the Likert scales, what will be the KPI (Key performance indicator) for this
project, and basics of market research. This was a great opportunity for me to gain knowledge
about how online reviews work, how are they perceived by the consumers and nuances of the
travel and hospitality industry.
 Limitations

Despite having both research and practical implications in our study, it is appropriate to point out
the limitations associated with our project.
Firstly, our data does not have any cross-cultural consumer behavior. Hence, future study on this
project needs to collect a larger dataset with broader participation of different cultures.
Second, different types of consumers, hotels and third-party sites might be considered for future
research. The respondents of the conducted survey may not be reflective of many different types
of “consumers” in this study and broad generalization should not be made.
Thirdly, due to the parsimonious model in predicting individual’s intention to book through online
reviews, we did not examine how individual’s bias towards a certain hotel brand or the reviews on
the hotels own website may lead to change in intention to book.
In addition, the information provided by the survey conducted may not be accurate as there might
be discrepancies in the responses given by the respondents. Though measures has been taken to
reduce that effect, there should be more detailed information on data collection and detailed
characteristics of respondents for the future study.
Consequently, all hotels and third-party sites are also assumed identical in this study. Hence,
different hotels, third-party sites or price may also be effective in intention to book for future study.
 References

Anderson, C. K. (2012). The Impact of Social Media on Lodging Performance. Cornell Hospitality Report,
12(15), 4–11.
http://www.budigitalhub.com/sites/default/files/white_papers/HotelsSocialMedia.pdf

Anderson, E. W. (1998). Customer Satisfaction and Word of Mouth. Journal of Service Research, 1(1), 5–
17. http://doi.org/10.1177/109467059800100102
Benckendorff, P.J.; Sheldon, P.J.; Fesenmaier, D.R. Tourism Information Technology; Centre for
Agriculture and Bioscience International (CABI): Wallingford, UK, 2014. [Google Scholar]

Chevlier, J., &Mayzlin, D. (2006). The effect of word-of-mouth on sales: Online book reviews.
Journal of Marketing Research, 43 (3), 345-354.

Cox, C., Burgess, S., Sellito, C., &Buultjens, J. (2009).The role of user-generated content in
tourists’ travel planning behavior.Journal of Hospitality Marketing & Management, 18,
746-764.

Dipendra Singh, E. T. (2015). Hotel Online Reviews and Their Impact on Booking Transaction Value. XVI
Annual International Conference. [Google Scholar]

Duan, W., Gu, B., &Whinston, A. (2008). Does online reviews matter? – An empirical
investigation of panel data. Decision Support Systems, 45 (4), 1007-1016. [Google
Scholar]

Eva Martin-Fuentes, C. M. (2020). The more the merrier? Number of reviews versus score on TripAdvisor
and Booking.com. International Journal of Hospitality & Tourism Administration, 21(1), 1-14.
Retrieved from [Google Scholar]

Law, S. W. (2017). Leveraging Online Reviews in the Hotel. In Z. Xiang, & D. R. Fesenmaier, Analytics in
Smart Tourism Design - Concepts and Methods (pp. 235 - 252). Springer. [Google Scholar]
Mogelonsky, L. Hotel Llama: Essays in Hotel Marketing and Management; Author House: Bloomington,
IN, USA, 2015. [Google Scholar]

Provider of Hotel Reservation and Distribution Technology Improves Service to Customers by 13%,
Reduces Costs 35%. NTT Data, 2012. Available online: https://us.nttdata.com/en/-
/media/nttdataamerica/files/resource-library-pdf/provider-of-hotel-reservation--distribution-
technology-improves-service-to-customers-by-13-reduces-c.pdf
Seo Yeon Kim, J. U. (2017). The Effects of Perceived Value, Website Trust and Hotel Trust on Online
Hotel Booking Intention. Mobile Technology and Smart Tourism Development.
https://doi.org/10.3390/su9122262

Team, T. Who Will Benefit from Travelzoo’s Hotel Booking Platform and How. 2 May 2014.
https://www.forbes.com/sites/greatspeculations/2014/05/02/who-will-benefit-from-travelzoos-
hotel-booking-platform-and-how/#49214c7423ed

Zhang, Y., & Va´squez, C. (2014). Hotel’s responses to online reviews: Managing consumer
dissatisfaction. Discourse, Context and Media, 6, 54–64.