A Study On Role Of Advertisement And

Hospitality Growth

Submitted By
Chhetra Bahadur Rana
PU Registration No. : 066-2-2-01540-2018
Kantipur International College
BHM, Sixth Semester

A seminar report submitted to the Purbanchal University, Faculty of

Management, in partial fulfillment of the Degree of Bachelor of Hotel
Management (BHM).

June, 2022
Kathmandu, Nepal

i
 CANDIDATE DECLARATION

I am Chhetra Bahadur Rana trust worthy certify that the work embodied in
the seminar report entitled, “ ROLE OF AVERTISEMENT ON HOSPITALITY
GROWTH” form of partial fulfillment of the requirement for the Bachelor of
Hotel Management (BHM) under faculty of Management, Purbanchal
University, Nepal.

I hereby declare that the work presented in this seminar report is a genuine work
done originally by me and has not been specifically acknowledged by
references to the author or institution. I shall be ready to bear any of the charges
or penalty if found any copied.

……………………………….

Chhetra Bahadur Rana

Batch 2018

ii
 ACKNOWLEDGEMENTS

In correctly finishing this project, many people have helped me. I would like to
thank all those who are associated to this project.

Primarily, I would thank God for being able to complete this project with
success. Then I will thank our coordinator Mr. Nabin Kumar KC and subject
teacher Mr. Laxman Tandan below whose guidance I realized a lot about this
project. His pointers and directions have helped in the completion of this
project.

Finally, I would like to thank my mother and father and friends who have
helped me with their precious suggestions and training and have been very
useful in a variety of ranges of project completion.

ii
 ABBREVIATIONS

BHM : Bachelor of Hotel Management

HAN : Hotel Association Nepal

AMA : American Marketing Association

iv
 ABSTRACT
Hotel advertising is the title given to a collection of exclusive marketing
techniques, which are used to promote a lodge and its services. This aim of this study
is to ascertain the influence of advertising in hospitality industry growth. With the
help of advertising how hospitality industry can grow positively in the market.
Specifically the study seeks to; to establish the extent to which advertising is used in
hospitality operations and then determine the relationship between advertisement and
hospitality growth.

With so many hotels all competing for the same business, why do some brands
and organizations attract extra company than others? Quality of route performs a role,
however the significance of marketing in the hotel industry is now not to be
underestimated. A strong advertising campaign can propel any manufacturer of any
size into the spotlight in an instant. If you know how to portray your commercial
enterprise in an influential manner in the front of the right audience, your success
story writes itself.

The study recommended that it is important for the hospitality industry to extent
the use of advertising for the positive growth of industry. The study suggested that the
hospitality industry should not negligence the importance of advertising because it is
now one of the important factor for the growth of this industry. And also it is
necessary for the hotel to further research on it in a vast level. It was also concluded
that having the impactful advertisement have at least more than moderate influence in
the competitive advantage in advertise

V
 TABLE OF CONTENT

CANDIDATE DECLARATION i
VIVA-VOCE SHEET ii
ACKNOWLEDGEMENT iii
ABBREVIATIONS iv
ABSTRACT v

CONTENTS
Chapter I - Introduction
1.1 Background of the study 1
1.2 Statement of the study 2
1.3 Objectives of the study 2
1.4 Significance of the study 2
1.5 Profile of the hotel industry in Nepal 3
1.6 Limitations of the study 4

Chapter II - Literature Review

1.7 Definition of Advertisement 5
1.8 Previous literature review 5-10
1.9 Theoretical Framework 11

Chapter III - Research Methodology

1.10 Research Design 12
1.11 Nature and Sources of Data 12
1.12 Study Population and Study Sample 12
1.13 Ethical Consideration 13

Chapter IV - Observation, Data Presentation and Analysis

1.14 Demographic Information 14-17
1.15 Observation and Data Analysis 18-19

Chapter V - Summary of findings, conclusions, recommendations

1.16 Summary of findings 20
1.17 Conclusions 20
1.18 Recommendations 21

Reference 22-23
Appendix 24-26
 LIST OF FIGURES & TABLES

Fig no. Title Page no.

1 Conceptual Framework 11
2 Distribution of respondents by gender 14
3 Distribution of respondents by age group 15
4 Distribution of respondents by hotel visit 16
5 Distribution of respondents by occupation 17
6 Data of survey 18
 CHAPTER - I
INTRODUCTION

1.1 Background of the Study

The hospitality business enterprise is one of the largest and fastest creating
industries round the world. The enterprise includes of a range of sub-sectors which
consist of the lodge sector, restaurant and resort. The tourism and hospitality
enterprise is a vicinity that most international areas round the world try to develop.
The organization has been one of the necessary employers at some stage in the world.
The hotel enterprise being a quintessential phase of the wider hospitality enterprise
occupies an necessary place in the economy of most countries, the industry has been
forecasted to generate 555 billion U.S bucks in profits in 2016.

The hotel industry, being the most visible sector within the hospitality industry, is
experiencing a important setback that threatens the beauty of the region to prospective
investors. Even though a variety of statistics shows that the enterprise has been
growing at an astronomical rate, taking a closer seem at these statistics, one will find
out that the foremost increase in the industry can solely be considered in the chain
operated accommodations and enterprise cooperate segments. Furthermore, the level
of competitions inside the lodge industry has multiplied so a lot in the recent decades,
to the point that it poses a risk not only to new entrants into the industry but also to
those organizations that have been in the enterprise for many years. It is no longer a
secret that many hotels are struggling to keep up with the degree of competitions each
within and outdoor the industry. Only a few resorts are able to preserve the stress and
make a profit in the long run. This has raised a imperative questions such as what
does the future hold for small and medium scale hotels? How can they make a
sustainable profit in the industry? A easy answer to these questions can be located in
the latter phase of this report.

This lookup proposes to examine the role of advertising in hospitality settings,

specifically in the hotel industry. The intention of writing this report is to analyze the
function which advertising plays in the development of hotel industry; the way
advertising has changed the industry and how it can be used to similarly develop the
industry and to create a advantageous brand photograph of a hotel in the minds of the
customers.

1
1.2 Statement of the Study

 What is the Impact of advertisement on hospitality growth?

 How can advertising be used effectively and efficiently to promote a hotel as a
brand?
 What is the contribution of advertising in hospitality growth?

1.3 Objectives of the Study

 To assess the role played by advertising in the development of the hotel

industry.
 To find out how advertising encourage demand in hotel.

1.4 Significance of the Study

 The study helps to know about how advertisement promotes hotel industry .
 This study focuses heavily on creating experiences and relationships with
customers and hotel.

2
1.5 Profile of the Hotel in Nepal

Hospitality industry is an
important feature of global
interdependence. Although the
history of hospitality is very long,
hospitality industry as w e know it
today began to take
a form in the early 1950s and
60s, leading the way for growth
into dynamic industry as
we know today. Modern
hospitality industry’s growth has
moved almost parallel to the
natural outgrowth of
globalization. International hotel
chains were evolved in the
early

3
50s grew in the 60s and, have
been expanding in the following
decades
Hospitality industry is an vital characteristic of international
interdependence. Although the history of hospitality is very long, hospitality industry
as we know it today started out to take a shape in the early 1950s and 60s, leading the
way for growth into dynamic enterprise as we comprehend today. Modern
hospitality industry’s increase has moved nearly parallel to the herbal outgrowth
of globalization. International hotel chains were developed in the early 50s grew
in the 60s and, have been expanding in the following many years.

Hospitality is a segment of existence in Nepali society considering that long back.

However, it used to be the 2nd periodic structure (1962/65) that emphasised on the
want of modern day hospitality industries in the country. The 1972 Tourism Master
Plan reiterated the prefer and value of current resort lodging and tour services for
tourism improvement in the country. To this give up the authorities installed Hotel
Management and Tourism Training Center in 1972 essentially to cater the human
useful resource wishes for tourism and hospitality agency in the country. Similarly
Tara Gaon Culture and Tourism Centre used to be mounted in 1974 for the promotion
of Nepali kind hospitality in the country. Hyatt Regency Hotel of Kathmandu is an
end result of Tara Gaon Development Committee’s (formerly Tara Gaon Culture and
Tourism Centre) noble efforts to establish different Nepali kind motel enterprise in the
country. During the preliminary section of the extend of hospitality industry, Nepal
Industrial Development Corporation invested a large sum of cash for the
establishment of Star Hotels. It ought to no longer be that a complete lot high-quality
and, subsequently did now now not closing long. However, it is the non-public area
that virtually initiated growing the inn organization in the country; and, is persevering
with to lead the sector. Dwarika Hotel is a testimony of Nepali sort architectural
heritage. Pioneer celebrity resorts like Soaltee Oberoi and Hotel de’la Annapurna had
barring a doubt a pinnacle notch contribution in organising and flourishing hospitality
enterprise .

Details : According to HAN ( Hotel Association Nepal )

Number of Hotels in 2019
Star Hotels : 138
Tourist Standard Hotel : 1151
No of Beds : 43999

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1.6 Limitations of the Study

Each and every study has its own limitation. The study subject to following
limitations :

 This study only deals with hospitality industry in Nepal.

 Study is focuses only with the advertising activities practiced in hotel industry.
 The study choose convenience sampling.
 This research study was constrained by inadequate data and information.
Likewise the services can't be inventoried.

Hospitality industry is an important feature of global interdependence. Although

the
history of hospitality is very long, hospitality industry as w e know it today began to
take
a form in the early 1950s and 60s, leading the way for growth into dynamic industry
as
we know today. Modern hospitality industry’s growth has moved almost parallel
to the
natural outgrowth of globalization. International hotel chains were evolved in
the early
50s grew in the 60s and, have been expanding in the following decades

5
 CHAPTER - II
LITERATURE REVIEW

2.1 Definition of Advertisement

Definition of Advertising Leo (2013) defines advertising as a controlled,

identifiable and persuasive communication that is presented via the mass media and
designed to develop product demand and to create a favourable image for a company.
Advertising is a paid form of non-personal presentation of ideas, goods and services
by an identified sponsor with a view to disseminate information concerning an idea,
product and service (Puranik, 2011).
American Marketing Association (AMA) recognizes the term advertising as – any
paid form of non- personal presentation and promotion of ideas, goods and services
by an identified sponsor. This definition mainly explains what advertising is and helps
in distinguishing advertising from other communication initiatives with which it is
often confused. Advertising is not the same as publicity.

2.2 Previous literature review

There are generally three different approaches to investigating the effectiveness

of
advertising expenditures: advertising and sales approach, advertising and profitability
6
approach, and advertising and market value approach.

Advertising and Sales Approach

Linking advertising expenditures with sales is a typical starting point to assess

the
effectiveness of advertising. Systematic relationship cannot be consistently found, and
results of previous studies vary by industry or sub-industry. Building on the Koyck
distributed lag model, Abdel-Khalik (1975) found significant distributed lag effects in
food, drugs and cosmetics, but not in the tobacco or the soap and cleansers industry.
Consequently, different accounting treatments are recommended in different
industries, rather than a uniform accounting policy. Based on a cointegration analysis,
Elliott (2001) found that there is a long-run equilibrium relationship between
advertising expenditures and sales for the food industry, but not for the more specific
soft drinks industry. The industry difference of advertising effects was explained by
the fact that the cointegrating relationship between advertising and sales is more likely
to exist when demand saturation in that industry has not been reached. Based on a
marketing-persistence model, Zhou, Zhou, and Ouyang (2003) suggested the long-
lasting television advertising effects on sales existed for consumer durables, but not
for consumer nondurables. The reason may 10 be that purchasing consumer durables
is a high-involvement decision, which contains more purchasing risks and needs more
information search efforts. Based on the statement from Vaughn (1980) that the
involvement level affects receptivity to advertising, Zhou etal. (2003) concluded that
purchasing durables requires more thinking process, has longterm memory effects,
and builds stronger brand preference.

In tourism and hospitality sub-sectors and related industries, mixed results have
been reported using the advertising and sales approach. While some prior studies
found no effects of advertising expenditures on sales, other studies reported short-
term or longterm effects on sales. From the demand perspective, Duffy (1999) found
no effect of advertising expenditures on inter-product distribution of food
consumption over the period from 1969 to 1996 in the UK's food sector. Herrington
and Bosworth (2016) found there was a lack of relationship between advertising and
sales for restaurant chains from 1984 to 2008. However, Simon (1969) found a long-
run effect of advertising on sales for 15 of the largest-selling liquor brands in the U.S.
from 1953 to 1962. Kamal and Wilcox (2014) found a positive relationship between
advertising expenditures and sales of quickservice restaurants from 1986 to 2007 but
the impacts small. Furthermore, Park and Jang (2012) found advertising expenditures
had a positive short-term effect on sales growth for the restaurant industry from 1995
to 2008. Finally, Assaf et al. (2015) found advertising spending has a positive impact
on sales performance measured by the dynamic stochastic frontier approach for a
sample of Slovenian and Croatian hotels from 2007 to 2012.

7
 However, the advertising and sales approach is plagued with several issues.
Koyck distributed lag model, measuring distributed lag effects of advertising on sales,
is a popular way to investigate the magnitude of the advertising effectiveness (Abdel-
11 Khalik, 1975; Clarke, 1976; Koyck, 1954). However, the distributed lag approach
is
inappropriate in studying advertising effectiveness due to high multicollinearity
between current and past advertising expenditures (Hirschey, 1982; Picconi, 1977). In
addition, there is a potential omitted variable problem in previous studies. Landes and
Rosenfield (1994) found that many existing economic models failed to control for
other firm-specific factors, which could bias the results significantly. Furthermore, the
directions of casual relationship are not clear because the causality may run in both
directions: advertising may affect sales because advertising influences consumers’
preference, and sales may also affect advertising because many firms set their
advertising budget based on certain percentage of sales (Herrington & Bosworth,
2016; Lee, Shin, & Chung, 1996).

Advertising and Accounting Profitability Approach

Rather than just focusing on sales, Hirschey (1982) argues that a firm’s overall
objective in advertising is profit, including increasing sales as well as reducing costs.
Specifically, product advertising moves the potential customers through a hierarchy of
stages toward a final purchase decision, which is directed toward sales. While,
institutional advertising deals with broader stakeholders, it is related to both
increasing sales and reducing costs. As a result, the advertising and accounting
profitability approach has been suggested as a more comprehensive method than the
advertising and sales approach. However, mixed results have been reported in terms
of the relationship between advertising expenditures and accounting profitability.
Erickson and Jacobson (1992) found no evidence that advertising expenditures can
generate supernormal accounting profits, but Graham and Frankenberger (2000)
found advertising expenditures contribute 12 to earnings for more than one year. In
the tourism and hospitality industry, Denizci and Li (2009) found no significant
relationship between advertising expenditures and accounting profitability ratios
including return on equity, return on assets, and profit margin for 17 large tourism and
hospitality firms. The mixed results can be explained by several drawbacks of this
approach, including unadjusted accounting profitability measures and simultaneity
causality problem. Before analyzing the determinants of profitability and especially
the effect of advertising expenditures on profit rates, the profit rates as the dependent
variable must be adjusted (Grabowski & Mueller, 1978). Corrected profit measures
should be constructed because the profit measures under the current accounting
treatment fail to incorporate the value of firm investments in intangible capitals such
as advertising expenditures. The current accounting treatment tends to depreciate

8
tangible assets, while expensing intangible assets, which leads to measurement error
of the accounting profit measures, such as net profit, return on equity, return on assets,
profit margin, etc. The problem of the accounting bias is particularly severe if the
research objective is the role of intangible capitals such as advertising expenditures in
explaining variation of profit rates. As a result, the problem of using unadjusted
profits leads to systematic bias in regression analysis (Heflebower & Telser, 1969).
Furthermore, there is the simultaneous problem of causation between advertising
expenditures and profitability. Advertising expenditures can benefit a firm’s
profitability by differentiating the firm’s products from competitors, while a firm’s
internal funding such as profitability is crucial for determining and financing
advertising expenditures (Erickson & Jacobson, 1992).
Advertising and Market Value Approach

In order to avoid the problems in associating advertising expenditures with sales

or profitability, a better alternative is the market-based valuation approach (Ali Shah
& Akbar, 2008). Based on the efficient market hypothesis (Malkiel & Fama, 1970),
marketbased valuation approach believes that firm’s market value is “the present
value of all expected cash flows from a firm’s assets and, at any given time, reflects
all the available information about a firm’s current and future profit potential”
(Agrawal & Kamakura, 1995, p. 57). Both tangible and intangible factors that have
systematic influences on profitability can be captured by a firm’s market value
(Hirschey & Wichern, 1984). A firm’s market value can be considered as a firm’s
economic profit based on market participants’ valuation of firm stock. Instead of the
accounting profit, firm’s market value is a more accurate dependent variable that can
minimize the measurement error due to accounting bias. Furthermore, there is
potential for advertising expenditures to affect both current and future profitability,
and firm market value as a future-oriented measure of profitability can capture both
the current and future profitability effects of advertising (Ali Shah & Akbar, 2008).
A typical market-based valuation analysis uses the regression model to
investigate the relationship between advertising expenditures and firm market value.
While the independent variables in the model vary from study to study due to
different theoretical frameworks, the dependent variable is often either the firm’s
market value based on stock price, or firm’s market value deflated by some scale
variables. For example, firm’s sales data has been used as deflator to reduce
heteroscedasticity (Han & Manry, 2004). Inaddition, book value was more often used
as deflator in valuation studies (Hirschey,14 1982; Hirschey & Weygandt, 1985).
Tobin’s q, defined as the ratio of market value to replacement costs of its assets by
Tobin (1969), is one typical example of using book value as deflator of firm’s market
value and is often used in tourism and hospitality valuation studies (Denizci & Li,
2009; Hsu & Jang, 2008; Park & Jang, 2012). However, the choice of deflator is
concluded to be one factor that contributes to the inconsistent results of previous
studies (Ali Shah & Akbar, 2008; Agnes Cheng & Chen, 1997). The underlying

9
reason is that selecting a different deflator means hypothesizing different linear
relationship between variables. The advantage of the theoretical framework of this
study is that it avoids the problem associated with deflator selection. Book value and
sales are both included as independent variables based on this study’s theoretical
framework, which is a more effective way than deflating regression variables by a
scale proxy at mitigating coefficient bias (Barth & Kallapur, 1996). Based on a
widelyaccepted valuation theory developed by Ohlson (1995) and the following
market-based valuation model developed by Han and Manry (2004), this study
developed three research hypotheses within the tourism and hospitality industry.
Using advertising and market value approach, Hirschey (1982) found current
advertising expenditures have significant and positive influences on the firm's market
value, suggesting significant future effects (intangible capital) of advertising.
Following Hirschey (1982), the positive effect of advertising on the firm’s market
value was confirmed, using a slightly different approach by regressing Tobin’s q on
advertising intensity, research and development intensity, and control variables
(Hirschey & Weygandt, 1985).
Graham and Frankenberger (2000) also confirmed the positive association
between advertising expenditures and firm’s market value, based on the 15 equality of
a firm’s marketing value and the market value of its net assets (Tobin, 1978).
However, Han and Manry (2004) found a negative association between advertising
expenditures and stock price, which may result from deflator choice or context
difference. In the tourism and hospitality industry, Hsu and Jang (2008) found a
positive relationship between current year’s advertising intensity and intangible value
of restaurant firms measured by Tobin’s q. Following Hsu and Jang (2008), Park and
Jang (2012) found that advertising intensity had both positive short-term and long-
terms effects on Tobin’s q in the restaurant industry. Denizci and Li (2009) also found
that advertising expenditures are significantly associated with Tobin’s q. Finally,
Assaf, Josiassen, Ahn, and Mattila (2017) found advertising has a positive impact on
market value added for restaurant and hotel segments. In sum, previous studies
support the asset value of advertising expenditures on firms’ market values in the
tourism and hospitality industry (Assaf et al., 2017; Denizci & Li, 2009; Hsu & Jang,
2008; Park & Jang, 2012).
From an accounting perspective, if the nature of advertising expenditures is short-
lived expenses, advertising can only benefit the current accounting period and the
effects quickly decays and should be expensed when incurred. If the nature of
advertising expenditures is long-lived assets, the advertising expenditures will benefit
beyond the current accounting period in which the expenditure is incurred and should
be capitalized and amortized over time (Sorter & Horngren, 1962). Accordingly,
Research Hypothesis 1 suggests that the influence of advertising expenditures on firm
market value is higher than the influence of other expenses. This indicates that the
advertising expenditures do not expire totally in the current year like other expenses;

10
instead, they may have future economic benefits for the firm’s market value, which is
the core characteristic of assets.

H1: The average influence of advertising expenditures on firm market value is

significantly higher than the average influence of other expenses in the tourism and
hospitality industry.
In addition, recent literature empirically shows that the overall importance of
brands for consumer decision making differs substantially across types of goods due
to the differences in risk reduction and social demonstrance (Fischer, Völckner, &
Sattler, 2010). Advertising expenditure is a key element of marketing spending and
the major contributor of brand equity (McAlister, Srinivasan, Jindal, & Cannella,
2016). According to information economics theory, consumer’s ability to assess
product quality prior to purchase vary fundamentally across types of goods, and the
guidance they need is higher for experience goods than search goods (Nelson, 1970).
Producers of experience goods advertise significantly more than producers of search
goods, because advertising for experience goods increases sales by increasing the
reputability of brands (Nelson, 1974).
Advertising expenditures are more important for nonmanufacturing firms
thanmanufacturing firms, that have tangible products or technologies that contribute
to the firm value (Ho, Keh, & Ong, 2005). Compared with goods products, services
products rely more heavily on advertising to deliver tangible and differentiating
information about the attributes and benefits of the services to the market, and to build
brand value (Pickett, Grove, & Laband, 2001). Furthermore, as tourism and
hospitality industry provides hedonic services, it has significantly higher advertising
effectiveness on consumer response than utilitarian services such as banking and
insurance due to different cognitive processes and greater need to justify hedonic
purchases (Décaudin & Lacoste, 2018; Kivetz & Zheng, 2017; Stafford & Day, 1995).
At the aggregated firm level, firms with a strong marketing’s influence are more
market oriented, and have better performance (Verhoef & Leeflang, 2009).
Specifically, advertising has a double positive impact on firm value, through
increasing sales and profits and building brand assets (Joshi & Hanssens, 2010).
Based on the information economics theory and previous findings, we propose the
strategic value of advertising expenditures on firm market value in the tourism and
hospitality industry. Accordingly, Research Hypothesis 2 suggests that the influence
on firm market value of advertising expenditures is higher than the influence of book
value. This indicates that advertising expenditures lead to higher firm market value
than the average return of firm value from firm net assets.

H2: The average influence of advertising expenditures on firm market value is

significantly higher than the average influence of book value in the tourism and
hospitality industry.

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 Prior advertising effectiveness research mainly focuses on specific sub-sectors
within the tourism and hospitality industry, yet the big picture of the umbrella
industry is understudied. The tourism and hospitality industry is categorized as a
service industry, providing consumers with an experience as their core product (e.g., a
good night's rest, safe transportation, a nice dining experience, etc.). The product
offered by the tourism and hospitality industry, being intangible by nature, is typically
abstract, perishable, mentally impalpable, non-searchable, inseparable, non-standard,
and non-owned (Lovelock & Gummesson, 2004; Mittal & Baker, 2002). Based on the
contingency theory, the effect of firm’s actions such as advertising on firm
performance are moderated by characteristics of the firm and its marketplace
(Srinivasan, Lilien, & Sridhar, 2011; Zeithaml, Varadarajan, & Zeithaml, 1988). As a
result, Research Hypothesis 3 is to test whether there is heterogeneity among sub-
sectors in the tourism and hospitality industryregarding the effectiveness of
advertising expenditures.

2.3 Theoretical Framework

This study aims to identify the influence of the independent variable of

advertisement on dependent variable of hospitality growth. In fact, this research
examines theoretic relationships between dependent variables and independent
variables.

Advertisement
Hospitality
growth

12
 Independent Variable Dependent Variable

Fig 1: Theoretical Framework

In this framework, there are certain factors influencing competitive advantage of

the hospitality industry. For this study, we have considered different moderator and
mediator variables. We have considered advertisement as independent factor which is
not dependent to any one and hospitality growth is considered as dependent factor
which is directly depend to other factor. Moderator variables like class of people may
affect both advertise and growth of the industry. Whereas mediator variable is
demand create by advertisement which directly affect in the growth of the industry.

CHAPTER – III
RESEARCH METHODOLOGY

3.1 Research Designs

Descriptive research design has been used. A descriptive research aims at

describing the characteristics of the population or phenomenon as exist. The main
objective of this study is to find out the impact of advertisement on hospitality
growth, so this research methodology has followed to meet the objectives of the
research. As the statistical tool diagrammatic and graphical representation, measure of
central tendency and dispersion have used to present the facts and figure.

13
3.2 Nature and Sources of Data.

In order to accomplish the above mentioned objectives of the research, necessary

data will be collected mostly through primary sources. The structured questionnaire
survey will be conducted to record the opinions, perceptions and characteristics of
college students in Kathmandu valley because it is always near its original form and
relatively free from editing, alteration or any form of modification and generalization
attributes. Therefore, it tends to be free from external control, judgment and bias of
others, which often lead to unsound interpretation by the researcher.

3.3 Study Population and Study Sample

Population of this study includes all the hotel costumer of star hotel, total number
of students are changing every day, so there is no exact data in population. Digitally
structured questionnaire were administered to the sample respondents. The
questionnaire will administered to the sampled unit via social media groups and asked
them to fill up the google form. As google form cannot be submitted without
completing each and every response, the response rate was 100%. All together
responses has collected via google form which is 50.

3.4 Ethical Consideration

The consent process shall ensure that individuals are voluntarily participating in
the research with full knowledge of relevant risks and benefits. The respondents has
communicated regarding the purpose of the research, expected duration and
procedures. Participants' rights to decline to participate and to withdraw from the
research once it has started, as well as the anticipated consequences of doing so has
been taken into consideration. In this study no activity has done that would influence
their willingness to participate, such as potential risks, discomfort or adverse effects.

14
 CHAPTER - IV
OBSERVATION, DATA PRESENTATION & ANALYSIS

4.1 Demographic Information

The following pie-chart shows the general information of various demographic taken
during our survey for data collection.

4.1.1 Distribution of the respondents by gender

15
 Figure 2: Distribution of respondents by gender

The above pie chart shows that there is higher percentage of male respondents in
the data collection survey which is 60% than the female respondents which is only
40% in the context of gender.

4.1.2 Distribution of the respondents by age group

16
 Figure 3: Distribution of respondents by age group

The above pie chart shows that majority of the respondents who participated in the
survey were between the age group of 20-30 years representing 80% followed by
below 20 years age group bracket at 13.3% and remaining 6.7% percent were 30-40
years of age group.

4.1.3 Distribution of the respondents by duration of hotel visit

17
 Figure 4: Distribution of respondents by Hotel visit

The given pie chart shows that nearly half of the respondents ( 45.5% ) like
to visit hotel only in occasion time, where as 20.5% respondents visit hotel
frequently, 18.2% respondents visit hotel once a week and remaining 15.9%
respondents like to visit hotel only once a month.

4.1.4 Distribution of the respondents by occupation

18
 Figure 5: Distribution of respondents by occupation

The above pie chart shows that more than half of the respondents which is 68.2%
is students, followed by private job holder (18.2%),government job (9.1%) and
remaining 4.5% were doing thier own business.

4.2 Observation and Data Analysis

The table shows the data’s mean, standard deviation, minimum and maximum result
in the term of 10 question’s answer in the survey by the representatives. The answer is

19
collected in 1,2,3,4 & 5 form which represents strongly agree, agree, neutral, disagree
and strongly disagree.

Question Mean Standard Maximum Minimum

number Deviation
1. 2.05 1.011472651 5 1
2. 2.675 0.944281032 5 1
3. 2.075 1.141018438 4 1
4. 2.875 3.553167601 5 1
5. 2.45 0.875595036 5 1
6. 2.475 0.905467722 4 1
7. 2.3 0.822753351 5 1
8. 2.7 1.066987131 4 1
9. 2.45 0.932325463 5 1
10. 2.25 0.839719123 4 1

Figure 6 of table shows finding of mean, standard deviation, maximum and minimum
from available data.

4.3 Data Analysis :

Qn.1 has got its average mean value 2 which means average answer is agree, similarly
standard deviation is slightly 1 which indicates data are respectively close to the
mean. Whereas maximum and minimum picked answer is 5 and 1 which means
respondents picked the answer between strongly disagree to strongly agree.

Qn.2 has got its average mean value 2.6 which means average answer is agree,
similarly standard deviation is close to 1 which indicates data are respectively close to
the mean. Whereas maximum and minimum picked answer is 5 and 1 which means
respondents picked the answer between strongly disagree to strongly agree.

Qn.3 has got its average mean value 2 which means average answer is agree, similarly
standard deviation is slightly 1 which indicates data are respectively close to the
mean. Whereas maximum and minimum picked answer is 4 and 1 which means
respondents picked the answer between disagree to strongly agree.

Qn.4 has got its average mean value close to 3 which means average answer is
neutral, similarly standard deviation is slightly more than 3 which indicates data are
respectively more spread out . Whereas maximum and minimum picked answer is 5

20
and 1 which means respondents picked the answer between strongly disagree to
strongly agree.

Qn.5 has got its average mean value slightly 2 which means average answer is agree,
similarly standard deviation is close to 1 which indicates data are respectively close to
the mean. Whereas maximum and minimum picked answer is 5 and 1 which means
respondents picked the answer between strongly disagree to strongly agree.

Qn.6 has got its average mean value slightly 2 which means average answer is agree,
similarly standard deviation is close to 1 which indicates data are respectively close to
the mean. Whereas maximum and minimum picked answer is 4 and 1 which means
respondents picked the answer between disagree to strongly agree.

Qn.7 has got its average mean value 2 which means average answer is agree, similarly
standard deviation is close to 1 which indicates data are respectively close to the
mean. Whereas maximum and minimum picked answer is 5 and 1 which means
respondents picked the answer between strongly disagree to strongly agree.

Qn.8 has got its average mean value close to 3 which means average answer is
neutral, similarly standard deviation is slightly 1 which indicates data are respectively
close to the mean. Whereas maximum and minimum picked answer is 4 and 1 which
means respondents picked the answer between disagree to strongly agree.

Qn.9 has got its average mean value slightly 2 which means average answer is agree,
similarly standard deviation is close to 1 which indicates data are respectively close to
the mean. Whereas maximum and minimum picked answer is 5 and 1 which means
respondents picked the answer between strongly disagree to strongly agree.

Qn.10 has got its average mean value 2 which means average answer is agree,
similarly standard deviation is close to 1 which indicates data are respectively close to
the mean. Whereas maximum and minimum picked answer is 4 and 1 which means
respondents picked the answer between disagree to strongly

21
 CHAPTER - V
SUMMARY OF FINDINGS, CONCLUSIONS AND
RECOMMENDATION

5.1 Findings

The research found out that advertising is importance to attached planning on

hotel and tourism industry and study also discovered that the attractive advertisement
really matter customers behavior and their attitude .The researcher discovered that the
hotel does not get more customer through satisfied customer as it ought to be and also
discovered that excessive services is used to entice its customers. The researcher also
discovered that the hotel has no fined period or time of advertisement. The frequency
of advertising depends on the period under consideration and also on the advertising
sequent objectives. The study of data shows that now a day online advertising
marketing influenced more customers rather than other means of advertising. Static
data found that hotel industry should seriously invest their sum of capital in
advertising field also. Research shows that hotel industry should advertise differently
their hotel for different age of group because different they all have different
Perception, concept and mindset. So they must focus their advertise according to their
categories.

5.2 Conclusions

On the basis of the above findings, the following conclusions were made for
advertisement and hospitality industry. The study shows that the applies of
advertisement in hospitality industry improved the efficiency of various department in
the hotel industry. Some of the ways in which advertisement has improved
operational performance in hospitality industry include; increased guest flow,
increased in sales, promotion of the hotel, helps in the brand building of the hotel.
Better advertisement technique gives hotel a good competitive advantage in the
market. Finally the research conclude that effective, meaningful and attractive
advertisement is huge beneficial for the hospitality industry and its growth.

5.3 Recommendation

Based on the findings of the study, the following recommendations are made for an
advertising activity practiced in hospitality industry.

22
 Hospitality industry should not underestimate the importance and power of
advertisement in today’s world.
 There is a conspicuous absence of long-term perspective policy by hotel
industry in the field of advertisement. So, hotel industry should come forward
with a long-term integrated policy in the advertisement field.
 Industry should make their marketing budget count in peak season.
 They should follow the appropriate strategies of advertising according to their
target market.
 The researcher recommends that further research should be carried out to find
out the more underlying factors relating to advertisement and its impact on
hospitality growth.

REFRENCES

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Kim, T., Choi, H., Song, C., & Lee, M. J. (2019). Investigating the

impact of advertising during economic shocks on firm performance

in the hospitality industry. Journal of Hospitality Marketing &

Management, 28(8), 1010-1031.

Chandra, M. (2020). Impact of Advertising and Marketing in Hospitality

Industry. NOLEGEIN-Journal of Global Marketing, 3(1), 35-42.

Qi, R., Cárdenas, D. A., Mou, X., & Hudson, S. (2018). The strategic

value of advertising expenditures in the tourism and hospitality

industry. Tourism Economics, 24(7), 872-888.

Abdel-Khalik, A. R. (1975). Advertising effectiveness and accounting

policy. The Accounting Review, 50(4), 657-670.

Ad Age Datacenter. (2018, June 24). 200 leading national advertisers

2018 index. Retrieved from

https://www.kantarmedia.com/us/newsroom/km-inthenews/us-

adspending-climbs-4-1-essentially-matching-gdp-growth-in-2018.

Agnes Cheng, A. C., & Chen, C. J. (1997). Firm valuation of advertising

expense: An investigation of scaler effects. Managerial Finance,

23(10), 41-62.

Agrawal, J., & Kamakura, W. A. (1995). The economic worth of

celebrity endorsers: An event study analysis. The Journal of

Marketing, 59(3), 56-62.

24
Ailawadi, K. L., Lehmann, D. R., & Neslin, S. A. (2003). Revenue

premium as anoutcome measure of brand equity. Journal of

Marketing, 67(4), 1-17.

Aitken, R., Gray, B., & Lawson, R. (2008). Advertising effectiveness

from a consumer perspective. International Journal of Advertising,

27(2), 279-297.

Ali Shah, S. Z., & Akbar, S. (2008). Value relevance of advertising

expenditure: A review of the literature. International Journal of

Management Reviews, 10(4),301-325. hen, M. H. (2015). Cyclical

effects of advertising on hotel sales, risk and return.

International Journal of Hospitality Management, 46, 169-179

APPENDIX

Dear Respondent, I am doing research to determine the role of

advertisement on hospitality growth. The following questionnaire is a

25
data gathering tool for the study. You are asked to select the choice the
best represents your preferences, and please pay attention to the questions
and assist it to be of high validity. It is intended that the findings of this
study will be used to provide better and more services. The information
supplied will be used solely for research purposes and will be kept strictly
secret.\

Appendix : 1

I am Chhetra Bahadur Rana regular student of BHM 6 th semester of

KIC want to request you to complete the following questionnaire by
providing relevant answer to the question which will help me to complete
my seminar report on the topic of “ Study on role of advertisement on
hospitality growth”.

SECTION A : Demographic Information

1. What is your gender?

a. Male
b. Female
c. LGBTQ

2. In which of the following age group do you belong?

a. Below 20
b. 20-30
c. 30-40
d. Above 40

3. How often do you visit hotel?

a. Frequently
b. Occasionally
c. Once a week
d. Once a month

4. What is your occupation?

a. Student
b. Business
c. Government job
d. Private job
26
SECTION B : Advertisement on hospitality growth

5. Advertisement plays vital role in the growth of hospitality industry effectively.

a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

6. Hotel should invest their capital on advertisement sector.

a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

7. Celebrity face is more impactful for advertising.

a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

8. Advertisement helps in the incremental floe of guest in hotel.

a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

9. Nowadays, online advertising is more effective than others one.

a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

10. Advertising is powerful technique capable of reaching and motivating large

audiences.
a. Strongly agree
b. Agree
27
 c. Neutral
d. Strongly disagree
e. Disagree

11. With help of advertising, it can help to promote hotel culture, moto, theme,
and environmental scene.
a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

12. Advertisement couldn’t attract all age group of people at a time.

a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

13. Advertisement assurance the customer about product and services provided by
hotel.
a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

14. Advertisement persuade the potential customer.

a. Strongly agree
b. Agree
c. Neutral
d. Strongly disagree
e. Disagree

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