Investigating Pricing Decisions in the Hospitality Industry Using the Behavioral Process Method

ABSTRACT This pilot study explored the utility of a behavioral process technique in assessing the attributes service providers deem most important when pricing a hotel room. Prior studies in the Israeli hospitality industry reveal that brand name, star rating, location, and number of rooms are all assets that can predict price. However, tracing the processes of individual decision makers' pricing strategies was not addressed in past research. The technique we used tracks item by item information acquisition to address this issue. Decision makers estimated the market price of a hotel room after sequentially revealing market information about competing hotels. The order of information search and the price estimate were measured.

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