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This study synthesizes existing empirical results about the relationship between electronic word of mouth (eWOM) and hotel performance via meta-analysis. Based on estimates from 25 articles, the average eWOM valence-based elasticity is estimated to be 0.888, whereas the average volume-based elasticity is 0.055. A hierarchical linear model is applied to uncover five factors that explain variations in eWOM elasticities: research setting, data structure, variable measurement, model specification, and research outlet. The estimation results highlight several significant aspects affecting elasticity, such as year of study, geographic setting, panel data structure, data frequency, performance measurement, control of price variable, and function form. Finally, implications are provided for researchers and hoteliers.
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Yang Yang, Ph.D
Assistant Professor
Temple University
1810 N.13th Street, Speakman Hall 304,
Philadelphia, PA 19122, USA
Tel: +1-215-204-5030
Sangwon Park, Ph.D*
Associate Professor
School of Hotel and Tourism Management
The Hong Kong Polytechnic Univeristy
17 Science Museum Road, TST East, Kowloon, Hong Kong
Tel: +852 3400-2262
Fax: +852 2362-9362
Xingbao Hu
Ph.D. Student
Temple University
1810 N.13th Street, Speakman Hall 304,
Philadelphia, PA 19122, USA
Tel: +1-215-204-5030
* = corresponding author
Please cite as:
Yang, Y., Park, S. and Hu, X. (2018). Electronic word of mouth and hotel
performance: A meta-analysis. Tourism Management. 67, 248-260
Abstract: This study synthesizes existing empirical results about the relationship between
electronic word of mouth (eWOM) and hotel performance via meta-analysis. Based on estimates
from 25 articles, the average eWOM valence-based elasticity is estimated to be 0.888, whereas
the average volume-based elasticity is 0.055. A hierarchical linear model is applied to uncover
five aspects that explain variations in eWOM elasticities: research setting, data structure, variable
measurement, model specification, and research outlet. The estimation results highlight several
significant aspects affecting elasticity, such as year of study, geographic setting, panel data
structure, data frequency, performance measurement, control of price variable, and function form.
Finally, implications are provided for researchers and hoteliers.
Keywords: meta-analysis; eWOM effect; hotel performance; hierarchical linear model (HLM)
1. Introduction
It is well known that the intangible, perishable nature of tourism and hospitality products makes
it difficult for consumers to gauge their quality prior to purchase. This phenomenon underscores
the perceived uncertainty in consumers’ decision-making process as it relates to travel, which
fosters a fundamental need to obtain reliable, useful information when considering travel options
(Liu & Park, 2015). With the recent proliferation of social media websites that facilitate the
sharing of travel experiences with others, the role of online consumer reviews has become
increasingly pertinent for the tourism and hospitality industry. A recent report by Mintel (2016)
revealed that consumer review websites have been identified as the second most frequently used
information source apart from search engines (e.g., Google) when travelers are researching a trip.
Service providers have therefore begun to leverage online consumer reviews, also known as
electronic word of mouth (eWOM), as marketing tools by inviting consumers to post their
personal experiences for others (Litvin & Dowling, 2016).
In the same vein, the relationship between online consumer reviews and hotel
performance has gained considerable attention from tourism and hospitality scholars (Schuckert,
Liu, & Law, 2015). Importantly, however, existing research remains largely inconclusive. For
example, while some studies suggest positive effects of eWOM on predicting hotel performance
(e.g., Ogut & Tas, 2012; Ye, Law, Gu, & Chen, 2011), others have found that the influence is
negligible or context dependent (Lu, Ye, & Law, 2014). Although prior research has provided
essential insight into the role of eWOM, a consensus about its utility vis-à-vis the tourism and
hospitality industry is elusive. Thus, the present study argues that the range of research
approaches, settings, designs, data sources, and estimation methods used in earlier analyses may
hinder generalizability (Floyd, Freling, Alhoqail, Cho, & Freling, 2014). For instance, eWOM’s
influence on hotel performance has been found to vary across different hotel classes (Blal &
Sturman, 2014). Using panel data to facilitate sound analyses, Duverger (2013) demonstrated a
non-linear (i.e., inverted U-shaped) relationship between eWOM and hotel performance.
Therefore, the aim of this research is to assess eWOM’s elasticity relevant to hotel performance
by considering five aspects as contextual variables: research setting, data structure, variable
measurement, model specification, and research output.
To fill this theoretical gap in the current literature, this study employs a meta-analysis
method, reviewing 25 research articles related to the tourism and hospitality industry. Meta-
analysis enables the authors to synthesize the literature stream quantitatively and therefore assess
eWOM elasticity as it corresponds to hotel performance (You, Vadakkepatt, & Joshi, 2015).
More specifically, this paper takes into account two separate metrics in measuring eWOM
elasticityvalence- and volume-based approachesto identify contributing factors to the
sizable variation among estimated eWOM elasticities. In this vein, eWOM elasticity refers to
percentage changes of firm performance against percent changes of eWOM consisting of
valances and volumes of review ratings (Floyd et al., 2014; You et al., 2015). This research
considers eWOM as numerical review ratings provided by consumers on travel review/booking
websites (Park & Nicolau, 2015). By doing so, this research represents a pioneering effort to
synchronize the eWOMperformance relationship in the tourism and hospitality literature. Use
of regression-based meta-analysis makes it possible to accommodate and correct potential biases
in previous econometric results objectively (Stanley & Doucouliagos, 2012).
2. Literature Review and Conceptual Framework
2.1 Theoretical background
Online consumer reviews have long been considered important sources of information; they
allow potential customers to assess the quality of a product or service and develop an associated
image (Filieri, 2016). Online reviews play a particularly central role in the hospitality and
tourism industry due to the services’ inherent intangibility and perishability. Indeed, consumers
find it difficult to evaluate the quality of services before actually consuming them (OConnor,
2010; Yang, Mueller, & Croes, 2016). This unique characteristic implies that people experience
significant uncertainty over their choices and, thus, require substantial information in order to
reduce perceived risks and make informed decisions. Dickinger (2011) found that online reviews
posted by other travelers are often thought of as more up-to-date, informative, enjoyable, and
reliable than information from travel service providers.
The prevalence of social media websites has created an environment where people face
information overload when confronted with numerous online consumer reviews. As such, in an
effort to reduce decision-making costs, they tend to rely more on review ratings than textual
comments. In other words, consumers who peruse multiple reviews are likely to focus on the
reviews’ valence and volume, which serve as proxies for underlying product quality (Chaiken &
Maheswaran, 1994) and hotel reputation (Anderson & Lawrence, 2014). Previous studies have
indicated that the valence and volume of online reviews indeed influence tourists’ decision-
making process (Liu & Park, 2015), along with organizations’ pricing strategies and performance
(Xie, Chen, & Wu, 2016). Signaling theory posits that people rely on signals when tasked with
making a judgment that requires balancing uncertainties. Given that most travelers today use
online channels to purchase tourism products, information asymmetry about product quality has
become widespread (Lu et al., 2014). Abrate, Capriello, and Fraquelli (2011) discussed the
importance of quality signals associated with hotel reputation as indicated by star rating and
brand affiliation. Online consumer reviews that reflect and justify users’ attitudes toward
products help readers reduce information asymmetry about product quality and, as a result,
increase their likelihood of purchasing relevant products (Park & Nicolau, 2015). In addition,
online reviews’ perceived effectiveness and reliability reduce search costs for consumers and
enhance sellers’ trustworthiness, which persuades people to pay more for products and ultimately
increases sales (Pavlou & Dimoka, 2006).
The valence of online reviewsthat is, the evaluative direction (positive or negative) of
the review in terms of service experienceis more effective than the midpoint of an individual’s
attitude toward the product (Mudambi & Schuff, 2010). Put another way, one-sided reviews that
clearly indicate the direction of a consumer’s opinion generate more diagnosticity and greater
salience than moderate reviews. The accessibility-diagnosticity model suggests that a piece of
information is perceived as diagnostic when it assists consumers in deeming an alternative
worthy of further consideration (Feldman & Lynch, 1988). In contrast, online comments that do
not help consumers determine whether a product warrants deliberation are not considered
diagnostic (Herr, Kardes, & Kim, 1991). Park and Nicolau (2015) demonstrated that consumers
consistently consider extreme ratings (whether positive or negative) to be more useful and
enjoyable than moderate ratings. Furthermore, people find negative reviews more helpful than
positive comments, as the guidance they receive is likely to reduce loss rather than increase gain
(c.f. Kahneman & Tversky, 1979).
The volume of online consumer reviews underpins the bandwagon effect (see Van den
Bulte & Lilien, 2001). A greater volume of opinions provided by other consumers positively
affects customers’ judgment, regardless of whether the opinions are positive or negative (Babić
Rosario, Sotgiu, De Valck, & Bijmolt, 2016). This phenomenon is tied to herding behavior,
otherwise known as social contagion, where people are likely to mimic others’ situational
behavior in order to reduce their own risk (Banerjee, 1992; Iyengar, Van den Bulte, & Choi,
2011). For purposes of this paper, the greater the number of opinions shared online by existing
consumers, the greater the chance that other customers will become aware of the product;
message repetition attracts consumers’ attention (Duan, Gu, & Whinston, 2008).
2.2 The effects of online consumer reviews on hotel performance in the hospitality and tourism
Numerous studies have empirically examined the relationship between online consumer reviews
and hotel performance. Ogut and Tas (2012) discovered that customer ratings boost hotel
performance and affect hotel room prices (Nieto et al., 2014). Several studies measured hotel
performance by the proxy variable of number of reviews for a property (see Ogut & Tas, 2012;
Ye, Law, & Gu, 2009). Ye et al. (2011) found that a 10% increase in review ratings posted on a
major Chinese online travel agency (OTA) increased online hotel bookings (measured by
number of consumer reviews on hotels) by more than 5%. In a more comprehensive study
investigating 10 major cities (five in Europe and five in the United States), Anderson and
Lawrence (2014) assessed hotel-level word of mouth (WOM) by using ReviewPro’s Global
Review Index. The index is an aggregate of millions of social media reviews in more than 35
languages, from OTAs, review websites, and social media platforms. Results revealed that the
review index positively influenced not only the elasticity of hotel performance but also room
Consistent with the above literature, two elements comprise consumers’ online reviews of
hotelsvalence (i.e., review ratings) and volume (i.e., review number)each of which plays a
distinct role in shaping business performance. For example, a positive valence affects revenue
per available room (RevPAR) in luxury hotels, whereas review volume influences low-tier
hotels’ performance (Blal & Sturman, 2014). However, these results are inconsistent across
studies: Kim, Lim, and Brymer (2015) determined that only valence, not volume, affects hotel
Different from other research, Duverger (2013) focused on a longitudinal panel data
sample (138 hotels with monthly performance) in evaluating the temporal dynamic nature of
market share via online reviews collected from three major OTAs (TripAdvisor, Orbitz, and
Expedia). A positive relationship was identified between average hotel property ratings and the
ratio of a property’s RevPAR to that of the market. Interestingly, the study revealed a quadratic
(i.e., inverted U-shaped) relationship, implying that the effect of review ratings has diminishing
From a methodological perspective, caution must be exercised around the endogeneity of
eWOM. In the hotel industry, managerial expertise contributes to performance in several ways:
hotels with more effective operational management tend to receive high consumer ratings, and
customers will likely prefer to stay in hotels that are operating well. Taken together, these factors
encourage increased bookings compared to hotels with poorer management. To account for
endogeneity in the statistical model, Lu et al. (2014) applied a difference-in-difference approach
by using large panel data (more than 40,000 observations) to eliminate unobservable factors
along with the endogenous effect. They also discussed the importance of considering a
moderation effect associated with hotel scales, which interacts with the relationship between
consumer ratings and hotel performance (see Blal & Sturman, 2014). Several scholars have also
considered other contextual variables involved in review patterns, such as rating variations (Xie,
Zhang, & Zhang, 2014) and hotel features, including operational strategy (e.g., management
response to consumer reviews) and dates of demand between weekends and weekdays (Schamel,
2012). Phillips, Barnes, Zigan, and Schegg (2017) investigated textual review and rating datasets
from 68 online platforms to assess their effects on performance for 442 hotels. Based on the
results of sentiment analysis, they concluded that positive hotel experiences in general have the
greatest impact on hotel demand and revenue.
These research efforts provide valuable information. To develop a better understanding of
the effects of online consumer reviews, however, it is necessary to address the systematic
variation resulting from diverse contextual factors (Blal & Sturman, 2014). It is also plausible
that the multiple research approaches, settings, and data sources utilized in analyses of online
consumer reviews may render generalizable conclusions nearly impossible (Floyd et al., 2014).
Even when studies focus on similar empirical contexts, there are conflicting findings about
eWOM volume and valence. Given the importance of these metrics to the topic at hand, this
study attempts to synthesize extant research on eWOM and compare the elasticities of eWOM
volume and valence to uncover their effects on hotel performance.
2.3 Conceptual framework of meta-analysis
The conceptual model of meta-analysis addresses the following factors related to the varied
effects of online consumer reviews (i.e., eWOM elasticity) on hotel performance: research
setting (i.e., research time, geographic setting, and hotel class); data structure (i.e., panel data,
sample size, and data frequency); variable measurement (i.e., eWOM platform, performance
measures, and elasticity type); model specifications (e.g., omitted variables such as price and
other eWOM, dynamic specifications, functional form, and model complexity); and research
outlet (i.e., journal article; Babić Rosario et al., 2016; De Maeyer, 2012; Floyd et al., 2014;
Purnawirawan, Eisend, De Pelsmacker, & Dens, 2015; You et al., 2015; see Figure 1). The
following section discusses these factors in greater detail.
(Please insert Figure 1 about here)
2.3.1 Research setting
Research time
In line with the expansion of IT technology, more and more travelers have come to embrace
eWOM platforms to familiarize themselves with hotels prior to booking. In previous years, when
eWOM platforms were less popular, eWOM elasticity was small and even negligible. Lewis and
Zervas (2016) found that ratings posted on review platforms became more influential over time
in determining hotel demand, a fact that is explained by these platforms’ growing popularity.
Therefore, the eWOM elasticity of hotel performance is expected to increase over time. Formally,
this research proposes that
H1: eWOM elasticities increase over time.
Geographic setting
Consumers’ cultural background is generally considered an important factor in dictating
information-seeking and purchasing behaviors. Hofstede’s cultural dimensions theory (2010)
suggests that national cultures vary based on the six dimensions of power distance,
individualism/collectivism, uncertainty avoidance, masculinity/femininity, long-term orientation,
and indulgence/self-restraint. This theory has been well applied in the tourism industry, unveiling
that Chinese travelers’ behavior is largely shaped by relatively higher levels of power distance,
collectivism, femininity, and long-term orientation compared to other cultures (Reisinger &
Crotts, 2010). In exploring differences in web communication behaviors between American and
Chinese travelers, Park and Reisinger (2012) discovered heterogeneous behaviors across
information seeking, communication, and transactions. More specifically, Chinese travelers from
highly collectivistic societies tend to use the Internet for social purposes and entertainment, and
they generally perceive higher risks when shopping online. Thus, it is important to assess
geographical contextin this case, whether the hotels investigated are located in China or
elsewhere. These arguments lead to the following hypothesis:
H2: eWOM elasticities are lower with hotels in China than elsewhere.
Hotel classes
Consumers’ online review habits appear to vary by hotel class. Indeed, consumers are more
likely to leave comments when they stay in higher-end hotels versus lower-end accommodations
(Miguens, Baggio, & Costa, 2008). Blal and Sturman (2014) found that eWOM volume appears
to exert positive effects on economy, midscale, and upper-midscale hotels, whereas effects are
negative for upscale and luxury hotels. Furthermore, the star ratings reflecting hotel classes
serve as another signaling factor (Lu et al., 2014). A five-star hotel is thought to provide guests
with high-quality facilities and services, which affects customers’ expectations for service
consumption. Indeed, although a five-star hotel may have negative reviews, consumers are still
confident in anticipating better quality compared to lower hotel classes with higher consumer
ratings. Thus, the following is hypothesized:
H3: eWOM elasticities are higher with low-class hotels than mid- and high-class hotels.
2.3.2 Data structure
Panel data
Longitudinal panel data provide researchers clearer insights into causality while controlling for
potential confounds (Rindfleisch, Malter, Ganesan, & Moorman, 2008). For example, because
panel data generally contain a greater degree of freedom and within-in-unit variation than cross-
sectional data, more meaningful model parameters are likely to be obtained (Baltagi, 2008). As a
result, findings derived from panel data are often considered more informative when inferring a
factual relationship between the variables being analyzed (Floyd et al., 2014). Therefore, the
following is proposed:
H4: eWOM elasticities are different between those studies analyzing panel and cross-sectional
Sample size
There is substantial evidence that a sufficient sample size is essential to achieving acceptable
error in model estimates and to determining error in the parameters being estimated, which is
associated with coefficient variation (Beaman, Huan, & Beaman, 2004). Sample size ultimately
reflects the accuracy and reliability of findings. Therefore, this study argues that an appropriate
sample size is necessary to ensure the accuracy of empirical findings delineating the eWOM
performance relationship. Additionally, sample size can influence the magnitude of estimated
eWOM elasticities. Thus, the following is hypothesized:
H5: eWOM elasticities vary across models using different sample sizes.
Data frequency
A finer level of temporal aggregation of the variable (e.g., a daily rather than monthly, quarterly,
or yearly level of data) used in the empirical model influences eWOM volume and valence
elasticities. Essentially, data aggregation at a coarser level is more likely to dilute variations of
performance as an outcome variable (You et al., 2015). Thus, the following hypothesis is
H6: eWOM elasticities are different across levels of data aggregations across weekly, quarterly,
and yearly formats.
2.3.3 Variable measurement
eWOM platform
It is important to address whether all eWOM communication channels generate equal or
disparate effects (Ya et al., 2015). A large number of studies in tourism and hospitality have
focused on specific eWOM platforms, such as TripAdvisor,,, or Yelp
(e.g., Park & Nicolau, 2015; Xie et al., 2014). Research has also found that disclosure of a
reviewer’s identity increases the perceived usefulness and trustworthiness of online reviews (Liu
& Park, 2015). Comments posted on platforms that offer structured fields for user information
and encourage reviewers to reveal their true identities (e.g., TripAdvisor) are more valuable to
other consumers than information provided on platforms that allow reviewers to remain
anonymous. In this respect, Ya et al. (2015) found that platforms such as community-based sites,
blogs, and online review websites play an important role in eWOM valence elasticities. In
particular, because TripAdvisor is the largest online community for travelers and has a well-
developed eWOM metric system (Levy, Duan, & Boo, 2013), and because many OTA websites
share TripAdvisor’s hotel eWOM metrics, TripAdvisor as a platform can be expected to provide
the largest eWOM effect. These arguments lead to the following hypothesis:
H7: eWOM elasticities are different depending on types of review platforms.
Performance measures
There are two main approaches to measuring hotel performance in studies investigating eWOM
effects in tourism: direct performance measures and proxy measures of performance. The former
(e.g., room nights sold, room revenue, occupancy rate, and RevPAR) is relatively straightforward
when interpreting performance elasticities (see Anderson & Lawrence, 2014). However, due to
restricted access to actual performance data, numerous studies have utilized proxy measures of
performance, such as the number of reviews written on review websites, based on the assumption
that review volume reflects the number of consumers who have experienced a specific product or
service (see Ogut & Tas, 2012; Ye et al., 2009, 2011). Thus, it is important to understand the
influence of different performance measures on eWOM elasticity.
H8: eWOM elasticities are different depending on the type of hotel performance measurement.
Elasticity type
As discussed in Section 2.1, online consumer reviews vary in volume (i.e., the total number of
eWOM units regarding a specific product or service) and valence (i.e., the idea that eWOM can
be positive, negative, or neutral; Liu, 2006). Volume refers to the number of consumers who
have experienced a level of popularity about a product in the market. Hence, it can be expected
that eWOM volume enhances consumers’ awareness of a given product and reduces their
uncertainty about it, which ultimately encourages sales (Chintagunta, Gopinath, &
Venkataraman, 2010).
eWOM valence captures the favorability, sentiment, or polarity of consumer reviews
related to evaluations and reputation of a product or firm. Consumers’ attitudes toward and/or
preferences for a product can be formed, reinforced, or changed by directional consumer reviews
(Kim & Gupta, 2012). Thus, discerning two metrics of eWOM valence and volumemakes it
possible to test the heterogeneity of sales elasticities. Therefore, the following is hypothesized:
H9: eWOM elasticities are different according to the types of elasticities estimated.
2.3.4 Model specification
Price control
Tourism and hospitality services have long been regarded as high-involvement products that
present significant risk, complexity, and price (McKercher, 2016). In addition, people do not
purchase these types of service products as often as they do routine products (i.e., low-
involvement products). As a result, consumers who buy high-involvement products engage in an
extensive problem-solving process that requires significant time and effort as they search for and
review relevant information (Mathwick & Rigdon, 2004). This implies that when consumers
purchase expensive (i.e., high-involvement) products, they are likely to look for reliable and
useful information by depending more on eWOM compared to those who buy inexpensive
products. Moreover, because price is closely associated with other unobservable characteristics
that may influence hotel performance (e.g., location), excluding a price variable can lead to an
omitted variable bias of estimates. Therefore, estimated eWOM elasticities can be expected to
depend on an empirical model’s specifications, including the inclusion or lack of a price measure.
These arguments lead to the following hypothesis:
H10: eWOM elasticities are different between those studies controlling and overlooking room
Because different eWOM metrics (i.e., valence, volume, and valence) capture different aspects
of eWOM effect, disregarding other eWOM metrics in the model may lead to some omitted
variable bias as well. Therefore, the following is hypothesized:
H11: eWOM elasticities are different between those studies controlling and overlooking other
eWOM metrics.
Dynamic specification
It may take time for hotels to internalize the benefits resulting from a positive online reputation;
therefore, some studies specify lagged independent variables in the empirical model (Blal &
Sturman, 2014; Lu, Xiao, & Ye, 2012; Xie, Zhang, Zhang, Singh, & Lee, 2016), especially for
weekly or monthly data. In general, specifying lagged eWOM independent variables can be
expected to result in greater eWOM elasticity of hotel performance.
H12: eWOM elasticities are different between those studies stipulating and overlooking lag of
independent variables and others.
Functional form
There are four typical functional forms in econometric models that estimate eWOM effects on
hotel performance. A log-log form includes the dependent variable (i.e., performance) and the
independent variable (i.e., eWOM valence or volume) in the estimated model as the natural log
of the original variable. A log-lev form refers to the specification that log-transformed only the
dependent variable while leaving the independent variable untransformed, whereas a lev-log
form suggests the opposite. Lastly, a lev-lev form includes untransformed dependent and
independent variables of interest (Floyd et al., 2014). As suggested by previous literature, the
functional form can influence eWOM elasticity (Floyd et al., 2014; You et al., 2015). Formally,
the following hypothesis is proposed:
H13: eWOM elasticities are different according to different functional forms in estimating
eWOM effects.
Model complexity
The number of independent variables indicates an empirical model’s complexity. Because
eWOM valence and volume also reflect some hotel characteristics that shape hotel performance,
omitting these key factors may lead to an “omitted variable bias” (Greene, 2007) associated with
the eWOM elasticity estimate. Therefore, eWOM elasticity can be expected to depend on model
complexity as measured by the number of independent variables in the empirical model. Thus,
the following is hypothesized:
H14: eWOM elasticities are influenced by the number of independent variables being estimated
in research.
2.3.5. Research outlet
Journal article
This research analyzed whether articles were published in research journals and how the research
outlet influences the estimated eWOM elasticities. If such influences exist, they can be explained
by the issue of publication bias, which refers to “the selective publication of studies with a
particular outcome, generally those which are statistically significant, at the expense of null
studies” (Ferguson & Brannick, 2012, p. 120). Publication bias may result in reduced inter-study
variability and inflation of biased mean estimates (Dickersin, 2005), which may potentially affect
estimated eWOM elasticities (Floyd et al., 2014). More specifically for journal publication bias,
this bias indicates that researchers are less motivated to submit manuscripts with non-significant
eWOM effect to journals because editors and reviewers are less likely to accept such manuscripts
(Card, 2015, p. 257). As a result, less significant and non-significant eWOM effects are more
likely to be seen in research from other outlets, such as conference papers and working papers,
which receive less pressure from editors and reviewers. These arguments lead to the following
H15: eWOM elasticities are less in journal articles than other resources.
3. Coding and Empirical Models
3.1 Data collection and coding
A search was conducted for relevant empirical literature investigating the relationship between
hotel performance and eWOM in online reviews by using the Google Scholar search engine,
EBSCO Hospitality & Tourism Complete database, SSRNs eLibrary, and the ProQuest
Dissertations & Theses database. The final search was completed on Dec. 11, 2016. The
keywords used in the literature search included “online rating”, “hotel sales”, “hotel
performance”, “online reviews”, “hotel demand”, and “TripAdvisor”. The references in
identified papers were consulted in a search for further studies. The search was restricted to
English-language materials but was not limited to journal articles.
After the papers were collected, they were screened according to the following criteria:
(1) valence and/or volume metrics of online reviews were used as independent variables, and
hotel performance measures (e.g., revenue, RevPAR, occupancy rate, room nights sold, review
volume as sales proxy) as dependent variables; (2) the studies’ empirical models had no latent
variable with which to measure hotel performance or eWOM metrics; and (3) elasticities were
either provided in each paper or could be clearly derived from the estimated coefficients and
other information. Room rate was not considered as a performance measure; therefore, estimates
using room rate as the dependent variable were excluded. Elasticity was chosen as the effect size
in the meta-analysis for several reasons. First, elasticity has an inherent economic meaning and
has been widely used in meta-analyses of marketing literature (Floyd et al., 2014; You et al.,
2015). Second, many studies in the sample reported elasticity estimates directly without
providing other necessary information to calculate alternative effect sizes, such as t statistics and
partial correlations (Stanley & Doucouliagos, 2012). Third, some elasticity estimates were
obtained from the interactions between eWOM metrics and dummy/categorical variables, which
compounded the challenges of obtaining standard errors and t statistics.
The literature search resulted in a total of 25 papers comprising the meta-sample. This
sample covered a variety of article types, including journal articles (19), dissertations and theses
(2), an academic report (1), a book chapter (1), a conference paper (1), and a working paper (1).
eWOM elasticities that used metrics of variance and ranking were excluded; very few studies
reported them, and the ranking metric is a function of review valence and volume (Rianthong,
Dumrongsiri, & Kohda, 2016). Because studies in the sample used different functional forms in
their empirical models, regression coefficients were transformed into elasticities by using
formulas suggested by Floyd et al. (2014) and You et al. (2015). For the log-log function, the
elasticity is the regression coefficient β itself; for the lev-lev function, the elasticity is β (
and are the mean values of the dependent and independent variables, respectively); for the log-
lev function, the elasticity is β; and for the lev-log function, the elasticity is β. If some
studies failed to report information necessary for the meta-analysis, every effort was made to
contact the authors.
Most studies in the sample presented multiple estimations using different model
specifications and/or different sub-samples. Moreover, they sometimes presented multiple
elasticity estimates based on different eWOM metrics in a single estimation. Therefore, multiple
elasticity estimates were coded from different estimations in a single study. By doing so,
efficiency was improved from the expanded sample size and additional within-study variation
across elasticity estimates (Melo, Graham, & Noland, 2009). The final sample was composed of
a total of 161 valence- and volume-based estimates taken from 25 studies. Apart from elasticities,
15 independent variables discussed previously were also coded to explain variations in eWOM
elasticities. Table 1 presents the coding schemes and descriptions of these variables. In the
research team, two coders recorded and calculated elasticities and the abovementioned
independent variables. After independent coding, the coders verified the consistency of results
and resolved any disagreements by discussion.
(Please insert Table 1 about here)
3.2 Empirical models
Hierarchical linear modelling (HLM) was used to uncover the impacts of various factors on
eWOM elasticities. HLM is particularly suited to modelling data with a nested structure, as in the
case of this dataset: an elasticity estimate is nested in a study. The traditional ordinary least
squares (OLS) regression assumes each observation to be independent from the others; however,
in this data set, different elasticities from the same paper can be correlated with one another. In
this research context, the HLM model can effectively account for within-study error correlations
stemming from unobserved study-specific factors (Edeling & Fischer, 2016), providing more
reliable estimation results. An HLM model is specified as follows:
ij ij i ij
 
 X
, (1)
where i indexes each study, and j indexes each elasticity estimate in study i. In the model,
denotes the jth elasticity estimate in study i, and
represents a set of independent variables.
is the normal error term (as in OLS regression), and
denotes the study-specific
effect that captures unobserved characteristics of the study that remained unchanged across
estimates within the study;
follow an independent normal distribution with a mean of
zero and a variance of
, respectively. The HLM model was estimated by using the
maximum likelihood estimation with the expectation-maximization algorithm, which is expected
to generate asymptotically efficient and consistent estimates (Hox, Moerbeek, & van de Schoot,
4. Results
4.1 Coding results
First, all 161 eWOM elasticities from 25 studies were coded. Most of these studies reported a
positive and significant effect of eWOM on hotel performance. However, some studies found
insignificant effects based on model estimation results. For example, Blal and Sturman (2014)
obtained an insignificant effect of eWOM volume on hotel performance based on 319 hotels in
London, and similar results on this insignificant effect were identified by Kim et al. (2015) from
128 U.S. hotels in a hotel chain. Furthermore, some studies investigated the eWOM effect for
hotels in different classes; therefore, different eWOM elasticities were extracted for them. More
specifically, Anderson (2012) and Anderson and Lawrence (2014) found larger eWOM
elasticities for mid-scale hotels compared to high-end ones; however, Duverger (2013) and Blal
and Sturman (2014) showed that eWOM elasticities are larger for high-end hotels.
Figure 2 shows the distributions of reported elasticity estimates in the data. For all
elasticities (in the upper panel), the mean value is 0.722 with a standard deviation of 0.965. As
shown in the histogram, the majority (92.55%) of elasticity estimates are positive. For valence-
based elasticities (N = 129), the mean value is 0.888 and the standard deviation is 0.999; both are
larger than their volume-based elasticity counterparts (N = 32), which are 0.055 and 0.329,
respectively. These results suggest that a 1% increase in eWOM valence would lead to a 0.722%
increase in hotel performance, whereas a 1% increase in eWOM volume would lead to a 0.055%
increase in hotel performance. As shown in the middle- and lower-panel histograms, compared
to valence-based elasticity, volume-based elasticity covers a narrower range of positive values.
Note that there is an apparent outlier, as indicated in the left tail of the distribution of volume-
based estimates. Further empirical investigation showed that the results would not change if this
estimate was removed; these results are available upon request.
(Please insert Figure 2 about here)
Table 2 presents the descriptive statistics of continuous independent variables in the specified
HLM model. The average data year of the sample was around 2011, and the year ranged from
2007 to 2014. Out of all elasticity estimates, 12.4% were based on Chinese hotel data, and 59.0%
used panel data covering hotel properties over time. A large proportion (58.4%) of the estimated
elasticity stemmed from TripAdvisor-based metrics. Notably, 16.8% of estimates were estimated
by using review volume as a proxy of hotel performance, which may introduce significant
measurement errors. As for variables related to the empirical model specification, 17.4% of
estimates were obtained from a model incorporating a price variable, 23.6% from models using
the lagged value of eWOM metrics as independent variables, 53.4% from models covering other
eWOM metrics, and 39.1% from models in a linear functional form (lev-lev) without log-
transformation of variables. Moreover, the average number of independent variables specified in
the empirical model was around nine. Lastly, 68.9% of elasticity estimates were collected from
journal articles. Table 3 presents the descriptive statistics of categorical independent variables.
Across the sample, 71.43% of estimates were based on a sample of hotels across different classes.
In this research, the sample included a variety of observation frequencies, with month-based
estimates outnumbering quarter-, year-, and week-based ones. As stated earlier, the sample was
dominated by valence-based elasticity estimates, which accounted for 80.12% of all estimates.
The correlation matrix of independent variables was also calculated. Most coefficients were
below 0.5, suggesting the absence of multi-collinearity (Gujarati & Porter, 2010).
(Please insert Table 2 about here)
(Please insert Table 3 about here)
4.2 HLM results
Table 4 presents the estimation results of the HLM models. A series of models was estimated
depending on the type of eWOM elasticities (i.e., the general eWOM elasticity, the eWOM
valence elasticity, and the eWOM volume elasticity). Moreover, because some studies used the
review number to proxy hotel sales, which may yield problematic results, different HLM
specifications were run with and without elasticities from these studies. In Model 1, only a few
estimated coefficients were statistically different from zero. First, proxy_perf had the largest
significant estimated coefficient across independent variables, and using review volume as a
performance proxy substantially inflated the estimated elasticity by 1.343 points. H8 is therefore
supported. Second, this result suggests that volume-based elasticity (elasticity_type = volume) is
0.751 point less than valence-based after controlling for other factors. H9 is therefore supported.
Third, elasticity estimates from the linear function without log-transformation of any variables
were 0.524 point less than estimates from other function forms. H13 is therefore supported.
Fourth, sample size appeared to be negatively associated with estimated eWOM elasticity, and a
larger sample size tended to generate a smaller elasticity estimate. H14 is therefore supported.
(Please insert Table 4 about here)
As shown in Model 1, using review volume as a performance proxy would substantially inflate
the elasticity estimate; therefore, Model 2 was run using the same specification after excluding
27 estimates from relevant studies. In Model 2, the insignificant estimate of year provides little
support to H1. The coefficient of China was negative and significant, suggesting that hotels in
China derive considerably fewer benefits from eWOM valence and volume compared to their
American and European counterparts. This result lends support to H2. For categorical variables,
a positive coefficient indicates a more elastic effect of eWOM in this category compared to the
reference category, and a negative coefficient indicates the opposite. Therefore, a positive
coefficient of class = low indicates that the eWOM elasticity of low-class hotels is significantly
lower than that obtained for the reference category: all types of hotels. H3 is therefore supported.
Moreover, panel_data was estimated to be negative and significant, and the use of panel data
substantially reduced the elasticity estimate by 0.908 point. H4 is therefore supported. Similarly,
as suggested by the results, a larger sample size used in the empirical model was associated with
a smaller calibrated elasticity estimate. H5 is therefore supported. As for data observation
frequency, compared to monthly data (the reference category freq = monthly), weekly data
generated a larger elasticity estimate by 0.306 point. However, the insignificant coefficients of
freq = quarterly and freq = yearly indicated that quarterly and yearly data produced no statistical
difference in the size of eWOM elasticities compared to monthly data. H6 is therefore partly
confirmed. In addition, no empirical evidence was found to support a larger elasticity from
TripAdvisor-based reviews. H7 is not supported by the result. Like Model 1, Model 2 highlights
a smaller size for volume-based elasticity and is 0.776 point less than a valence-based elasticity,
ceteris paribus.
Regarding variables related to model specification, the Model 2 results highlight the
important role of price measures as a control variable in estimating eWOM elasticity. More
specifically, controlling the price measure increased the size of eWOM elasticity by 0.130 point,
suggesting that omitting the price measure leads to a significant downward bias. This result
corroborates H10. However, the use of a lagged eWOM variable and inclusion of other eWOM
variables did not explain the variation of eWOM elasticity in the sample, leaving H12
unsupported. The negative and significant coefficients of linear_function and indep_vars
indicate that the use of a linear functional form (lev-lev) and more independent variables leads to
a smaller elasticity estimate, lending support to H13 and H14. Lastly, the coefficient of
journal_article was insignificant but positive, demonstrating that the magnitude of eWOM
elasticity from journal articles is not statistically different from that of other types of studies.
Therefore, H15 is rejected.
Because valence-based elasticity estimates dominated the sample, Model 3 presents the
HLM results for valence-based elasticities only. Similar to the results of Model 1, online review
volume was found to be a very poor proxy of hotel performance because of the significant and
sizable estimated coefficient of proxy_perf. Therefore, in Model 4, those elasticity estimates that
used review volume to proxy performance were excluded. Model 4 provided similar results to
Model 2, such as negative and significant estimated coefficients of year, China, class = low,
panel_data, lnsample_size, and linear_function. However, some differences were noted. For
example, using weekly data (freq = weekly), omitting price controls (price_control), and
including more independent variables (indep_vars) did not necessarily induce a statistically
different valence-based elasticity estimate.
Model 5 presents the estimation results of volume-based elasticities exclusively. Because
only 32 observations were included, some categorical independent variables had to be omitted,
such as freq and class, to provide more reliable statistical inference of the results. Note that no
studies adopted review volume as a performance proxy in any of the 32 observations. As
suggested by the significant coefficients of year and TripAdvisor, volume-based elasticity was
also found to decrease over time, and volume-based elasticities from TripAdvisor reviews were
significantly larger than others, revealing the central role of hotels’ visibility on TripAdvisor in
spurring performance. Therefore, H1 and H7 are supported for the valence-based eWOM
elasticities. Furthermore, the model specification largely explained variation in volume-based
elasticities across studies. More specifically, including price controls (price_control) and using
lagged eWOM variables in the model (lagged_indep) often led to a larger volume-based
elasticity estimate, whereas incorporating other eWOM independent variables (other_eWOM)
decreased estimates. Another model specification variable, indep_vars, was also estimated to be
significant, and its negative coefficient indicates that including more independent variables
would reduce the size of volume-based elasticity.
5. Conclusion and Discussion
In light of the proliferation of online consumer review websites and the nature of tourism and
hospitality products, eWOM has been recognized as one of the most important information
sources in the industry. It not only affects consumers’ decision-making process but also
influences hotel performance. Hence, several scholars have attempted to estimate the effects of
eWOM on hotel performance (e.g., Xie et al., 2014). Interestingly, their findings have been
inconsistent and inconclusive. This study provides generalizable evidence, demonstrating the
effects of online consumer reviews on eWOM elasticity according to volume- and valence-based
metrics. Specifically, a meta-analysis using an HLM model was applied by synthesizing 25
studies on eWOM elasticity in the tourism and hospitality fields to identify factors explaining
elasticity variation. This research thus offers important and insightful contributions to academics
and practitioners in the tourism and hospitality industry.
This study resolves existing conflicts in the literature and sheds lights on generalized
effects of eWOM volume and valence metrics by accounting for research setting, data structure,
variable measurement, model specification, and research output as five aspects that influence
eWOM elasticity of hotel performance. As a result, this research synthesizes extant research on
eWOM elasticity. To the authors’ knowledge, this is the first systematic attempt to compare the
degree to which eWOM elasticities are different between different measurements. Indeed, the
results of this study revealed that mean eWOM valence elasticity (0.888) is twice as large as its
counterpart (0.417) in the general marketing field as reported by You et al. (2015), highlighting
how necessary it is for hotels to maintain a high eWOM valence level to attract customers. This
result can be explained by the experiential nature of hotel products: no one knows the quality of
the product until consuming it. Customers therefore require supplemental independent reviews to
make a decision and reduce the risks associated with purchase. However, the mean eWOM
volume elasticity (0.055) is lower than its counterpart (0.236) in the general marketing field (You
et al., 2015). One possible explanation is that, as one of the first industries to embrace online
review platforms (Ong, 2012), eWOM valence elasticity is more substantial in the tourism and
hospitality industries than in others. Therefore, effective reputation management may be
especially rewarding for the tourism and hospitality business.
Second, these results underscored higher eWOM elasticity for mid-scale and high-end
hotels, suggesting that these hotels should place high priority on monitoring and managing
eWOM on various platforms in a timely manner. This finding falls into line with Blal and
Sturman’s (2014) and Lu et al.’s (2014) studies. Third, because TripAdvisor-based volume
elasticity was found to be more pronounced than others, hoteliers should motivate their guests to
post reviews on TripAdvisor over other platforms. Hotel managers’ engagement with consumers’
feedback on TripAdvisor is therefore of paramount importance. As shown in Table 2,
approximately 60% of the sample have investigated TripAdvisor as a key platform for their
research. Xiang, Du, Ma, and Fan (2017) have indicated a consistent conclusion that TripAdvisor
has been widely perceived as a premier data source in the hotel industry due to the number of
reviews available, wide distribution of review sentiment, adequate length of consumer reviews,
credibility, and helpfulness. Finally, the results from this regression-based meta-analysis provide
flexible estimates of eWOM elasticity-based, context-specific circumstances. Therefore, hotel
chains and groups can calibrate property-specific eWOM returns based on the characteristics of
each hotel and propose more effective strategies to prioritize reputation management in some of
This study provides some methodological implications and guidelines for researchers
when investigating the eWOMperformance relationship in tourism and hospitality. First and
foremost, it is inappropriate to use review volume to proxy hotel performance/sales in the
empirical model because this results in a biased estimate of eWOM effect, based on this study’s
meta-analysis results. Checking Appendix A, around 30% of articles have considered the number
of consumer reviews to measure hotel performance. Use of indicators that allow researchers to
estimate actual performance, rather than proxy measurements, is suggested. Second, it is highly
recommended that researchers collect panel data to understand the eWOMperformance
relationship, if available. The estimates from panel data (60% of the sample) were found to be
significantly different from others (40% of the sample used cross-section data). Due to several
inherent advantages of panel data, this type of data is particularly useful to understand a causal
relationship. Third, model specification is important to ensure a reliable estimate of eWOM
effect. More relevant independent variablesin particular, the price variableshould be
incorporated into the empirical model to alleviate the potential omitted variable bias. Lastly,
since the results suggested that models using the lagged independent variables do not yield
different results, use of the unlagged independent variables in empirical models is recommended
to keep more observations in the sample. This finding is partially consistent with You et al.’s
(2015) study concluding that the omission of a lagged term did not have significant influence on
valence elasticities.
Some limitations of this study should be noted. First, due to sample size concerns, other
eWOM metrics were not included, such as eWOM variance and online ranking. The estimated
elasticities based on these metrics may present different patterns from those identified here.
Second, eWOM elasticities in non-hotel hospitality settings were not considered. Lastly, since
the standard error of elasticities was not coded due to data limitation, it was not possible to
conduct some formal statistical procedures (e.g., funnel plot, fail-safe N, and standard error
control in regression) to test the issue of publication bias rigorously (Orwin, 1983; Stanley &
Doucouliagos, 2012). Therefore, it is recommended that future studies investigate alternative
eWOM metrics and elasticities in other tourism and hospitality sectors, such as restaurants.
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Figure 1. Conceptual framework of determinants of eWOM elasticity on hotel performance.
Figure 2. Histogram and kernel density of calibrated elasticity from extant literature.
Table 1. Coding scheme and description of independent variables.
Coding scheme
Research setting
midpoint of research period (in year)
time of study
1 = hotel properties in China; 0 = other
geographic setting
1= all types, 2 = low, 3 = mid, 4 = high
classes of hotels sampled
Data structure
1 = panel data; 0 = other
whether data cover multiple time periods
log of sample size in the model
size of data sample
1= weekly, 2 = monthly (reference category), 3 =
quarterly, 4 = yearly
frequency of data observations
Variable measurement
1 = TripAdvisor-based eWOM metric; 0 = other
platform effect of eWOM
1 = number of reviews to proxy hotel sales as a
performance measure; 0 = other
measurement of sales
1= valence-based, 2 = volume-based
type of eWOM elasticity
Model specification
1 = including price or average room rate as a
control variable; 0 = other
omitted variable problem associated with
price measures
1 = specifying lag of independent variables; 0 =
dynamic specification of independent
1 = including other online eWOM measures in
the empirical model; 0 = other
omitted variable problem associated with
other eWOM metrics
1 = linear function form (lev-lev); 0 = other
functional form of the model
number of independent variables in the empirical
complexity of the model
Research outlet
1 = published in a research journal with ISSN; 0
= other
Table 2. Descriptive statistics of continuous independent variables.
Table 3. Descriptive statistics of categorical independent variables.
Variable (category)
class = all
class = low
class = mid
class = high
freq = weekly
freq = monthly
freq = quarterly
freq = yearly
elasticity_type = valence
elasticity_type = volume
Table 4. Estimation results of HLM meta-analysis.
Model 1
Model 2
Model 3
Model 4
Model 5
Elasticity type
class = low
class = mid
class = high
freq = weekly
freq = quarterly
freq = yearly
elasticity_type =
# of observations
# of studies
(Notes: *** indicates significance at the 0.01 level, ** indicates significance at the 0.05 level, * indicates
significance at the 0.1 level. Robust standard errors are presented in parentheses. † indicates that the sample
excludes elasticities using review counts as hotel performance proxy.)
... As the number of travel destination keeps growing, consumers rely more on online resources for information in order to guide them with the choice of destination. As mentioned by Yang et al. (2018), past traveller plays an important role in providing information about travel destination since it is the second most popular source after search engine such as Google. With the popularity of consumer review, the service providers as well as practitioners have begun to maximize the use of online customer review to promote their business by showing positive feedbacks from past travellers called as electronic word of mouth (e-WOM). ...
... Since hospitality and tourism industry are related with services, online review plays an important role as a reliable source of potential traveller. The information from e-WOM has become more popular because the information is more up-to-date, enjoyable, helpful and trustworthy (Yang et al., 2018;Abubakar et al., 2017). The growth of website, blog, and review platform has increased interpersonal interaction among the travellers to share their experience. ...
... Much research has explored e-WOM in the context of tourism industry such as cruise lines (Sun et al., 2021), hotel performance (Yang et al., 2018), emotion tendency (Yan et al., 2018), destination trust (Abubakar et al., 2017) and online trust (Filieri et al., 2015). However, the current research explores on the effect of e-WOM on the choice of destination and the destination focuses on an island. ...
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The main aim of this research is to examine the influences of destination personality and electronic word-of-mouth in the context of destination selection decision-making. It also examines the influence of environmental sustainability on individuals’ sense of satisfaction and the mediating role of satisfaction in the context of destination choice and its subsequent effect on revisit intention. Langkawi’s designation as a UNESCO Geopark underscores its significance in terms of environmental sustainability, which is a primary focus of this study. The findings indicate a significant roles of personality traits of a destination and the electronic word-of-mouth communicated by individuals in decision-making process for selecting a destination. Additionally, the findings reveal that satisfaction plays a mediating role in the relationship between destination selection and the desire to engage in future visits
... An important factor that drives Mobile shopping (m-shopping) is undoubtedly the user generated content or eWOM available to assess products or services that potential users could utilise before making purchase decisions. Previous studies have shown that the volume of eWOM influences a potential customer's inclination to purchase a product (Yang et al., 2018). It is therefore very important for Mobile shopping service provides to motivate their existing customers to provide eWOM as they engage with their Mobile Shopping service. ...
... Thus, based on social exchange theory, personalisation can trigger an obligation to reciprocatewhich in the case of m-shopping app could take the form of deep eWOM providing behaviour. Yang et al. (2018) in fact found eWOM as a reciprocal behavioural outcome in the context of social-shopping m-commerce, though, in their study eWOM was measured as just recommendation behaviour. We therefore attempt to understand the mechanisms through which perceived personalisation is transformed into deep eWOM providing behaviour. ...
Purpose The study aims to look at deep eWOM providing behaviour in m-commerce and attempts to explore its antecedents. Personalisation is proposed as an indirect antecedent of deep eWOM providing behaviour mediated by hedonic and utilitarian value perceptions and personal identification. Design/methodology/approach Based on social-exchange theory, the conceptual model links the study antecedents to deep eWOM providing behaviour. The conceptual model was validated through a multi-country study. A large sample of m-commerce users in the UK ( n = 505), India ( n = 422) and Vietnam ( n = 618) were contacted to collect the data. Data were analysed through structural equations modelling procedure with invariance analysis conducted to ensure that the results from the three samples could be compared. The authors also conducted post-hoc analysis to explore the mediation paths between variables. Findings The study finds support to the conceptual model across the samples from the three countries. Personalisation is found to increase value perceptions – both utilitarian and hedonic – and personal identification which leads to “deep” eWOM providing behaviour across all the three countries. The serial mediation also provides comparable results across the three countries. Originality/value The study contributes to the understanding of deep eWOM providing behaviour – a construct with high practical relevance which has however not been explored sufficiently in current literature. The study also contributes to the literature that analyses the consequences of personalisation in m-commerce.
... This change has enabled customers as well as other stakeholders to post their reviews concerning the product and services consumption experience 24X7. The absence of a standard pattern and its disproportionate implications have piqued the interest of researchers and businesses in online consumer reviews (OCRs) and their implications (Albayrak & Ceylan, 2021;Babić Rosario et al., 2016;Floyd et al., 2014;Hong et al., 2017;Hu & Yang, 2021;Ismagilova et al., 2021;Ismagilova et al., 2020a;Ismagilova et al., 2020b;Li et al., 2020;Moradi & Zihagh, 2022;Purnawirawan et al., 2015;Verma, Prakash Dewani, et al., 2023;Wang et al., 2019;Yang et al., 2018;You et al., 2015). Moreover, their extended reach to a disproportionately larger population at a lightning-fast pace continues to sustain the stakeholders' interest. ...
... Connelly et al. (2011, p. 64) argued that "Individual may also serve as their own insiders when signaling about themselves". Prospective consumers rely on these signals to reduce uncertainties when considering new product purchases (Yang et al., 2018), bridging the information asymmetry between existing and potential customers. Additionally, the valence in OCRs has the potential to makes them more diagnostic, aligning with cue-diagnostic theory (Herr et al., 1991), and providing valuable information that shapes consumers' attitudes and behaviors. ...
As a result of digitalization, consumers have more agency than in earlier times. Consumers now have the ability to express their consumption experiences through diverse online platforms by means of rating or providing written feedback. The ability to effectively decipher online customer reviews (OCRs) holds significant importance for businesses due to its far-reaching consequences. This research aimed to determine if review valence (RV) (the degree to which reviews are extremely positive or negative) was transmitted to purchase intentions via review helpfulness within the framework of signaling theory and cue-diagnosticity theory. The research also examined the presence of negative bias among customers when evaluating the valence of online customer reviews (OCRs) and its signaling ofreview helpfulness. Further, to determine if such an effect occurs within the boundaries of brand equity, an experimental study was conducted sequentially on two products: mobile phones and laptop computers. The study did not find negative bias among consumers concerning the assessment of RV. Further, the study supports an indirect effect of RV on purchase intention through review helpfulness. In addition, the results demonstrate that the referred effect is fully mediated by review helpfulness. Moreover, the results indicate that such an indirect effect is contingent on the brand's equity. The findings indicate that the RV has a significant effect on purchase intentions, particularly when brand equity is low. The study also discusses its managerial and research implications.
The large volume of consumer reviews is useful for online shoppers trying to evaluate products when shopping. However, a section of shoppers does not have the motivation or the skills to analyze these reviews. Star rating and rating volume provide an easy way to evaluate products, at least in the initial stage of purchase decision-making. This research studied how shoppers perceive rating and volume and the influence of these factors on shoppers’ brand image of the product and purchase intention. The study using experiments evaluated the influence of low and high ratings on brand image and purchase intention, followed by the moderation effect of volume on these relationships. The study found a positive relationship among star rating, brand image, and purchase intention. The moderation effect of volume was significant for rating and brand image relationships alone.
Using data from 16,144 peer-to-peer properties in London, we study the impact of the two components of user-generated content – rating and sentiment – on occupancy rate. Our methodology is innovative because, firstly, we control for price variation when estimating these review-occupancy effects and secondly, we estimate interaction and curvilinear effects. We find that sentiment and rating have significant positive effects on occupancy rate; there is some evidence that sentiment and rating interact, one reinforcing the other; for a typical property among those analysed, an outstanding review increases occupancy by a fifth in relative terms. Thus, we interpret these associations as evidence that rating and sentiment signal value, and we estimate the strength of the signal in the peer-to-peer accommodation sector.
Recent advances in ICT has led to changes in the tourism sector, mainly in information dissemination and online reputation. Information no longer flows from suppliers to tourists, being the tourist, simultaneously an information consumer and an information creator or generator based on his tourism experience. Through networks, searches, and metasearch engines tourists can review and rate products and services and can access other users' information. They can access online content before, during, and after the trip. This information serves as a reference to choose the next destination to travel to, being much more influential than that generated by the tourism provider or the destination management office. As a case study, this chapter analyses online reputation of the hotel offer in the city of Porto (Portugal), the second most important city in the country, using information from Known as one of the most well-known search engines worldwide, allows the guests to assess the hotel units they have stayed in, using seven different items, from staff to free Wi-Fi.
Purpose Considering the transition of communicational channels from physical to digital spaces, this study aims to provide a theoretical foundation for understanding engagement in electronic word of mouth (eWoM) among managers and customers in the hospitality and tourism industry. Design/methodology/approach This study uses the four aggregate dimensions, namely, performance expectancy, efforts expectancy, social influence and facilitations condition. Further, this paper uses the 14 second-order themes of the Unified Theory of Acceptance and Use of Technology with a data set that represents elements that can trigger eWoM, both from managers’ and customers’ perspectives. The process of data structuration follows thematic analysis and axial coding techniques. Findings The results of this study show that performance expectancy, facilitation conditions, social influence and effort expectancy all trigger positive eWoM generation in the hospitality and tourism industry indicating customers’ and managers’ perspectives. Originality/value This novel study provides a theoretical foundation and novel propositions for future research work on the role of novel antecedents that can trigger eWoM in the hospitality and tourism industry. This paper also provides a benchmark for practitioners and policymakers in their strategic decisions-making towards improving business performance through positive eWoM.
Post COVID-19 changed the customer’s expectation in the hospitality industry. The purpose of the study is to better understand which factor influences customer positive emotions using the user-generated content during post COVID-19 related to luxury hotels in Goa. We extracted the review of three luxury hotels as a sample from Trip Content Analysis Tool Leximancer was used to analyse the user generated reviews. Analysis process included pre-processing the review, calculating the sentiment of the reviews, subjective words occurrence and co-occurrence and identifying concepts and themes. Themes identified include hospitality, experience, beach, room, service, help desk and property theme. Among these themes, hospitality, experience, beach and room, are related to the positive sentiment reviews influencing customer satisfaction. Service, help desk and property are the negative factors that are seen to result in dissatisfaction of customers. The current study by identifying the most important themes help managers in decision making process to allocate scarce resources in the best way feasible to keep their customers satisfied.KeywordsUser-generated contentLuxury hotelsCustomer satisfactionTrip advisorSentiment analysisGoaPost COVID-19
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Electronic Word-of-Mouth and Consumer Generated Media (CGM) have become important aspects of the hospitality and tourism marketing mix. This research looked at hotel reviews on the CGM review-site TripAdvisor to determine the influence loyalty to a hotel brand has upon postings. From the literature, one would expect brand loyalty to have a positive impact upon a poster's reviews. The findings, however, do not support this relationship. Brand loyalists were found to be neither more or less generous, nor volatile, than were other posters. Implications of these findings are discussed.
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Online consumer reviews have been studied for various research problems in hospitality and tourism. However, existing studies using review data tend to rely on a single data source and data quality is largely anecdotal. This greatly limits the generalizability and contribution of social media analytics research. Through text analytics this study comparatively examines three major online review platforms, namely TripAdvisor, Expedia, and Yelp, in terms of information quality related to online reviews about the entire hotel population in Manhattan, New York City. The findings show that there are huge discrepancies in the representation of the hotel industry on these platforms. Particularly, online reviews vary considerably in terms of their linguistic characteristics, semantic features, sentiment, rating, usefulness as well as the relationships between these features. This study offers a basis for understanding the methodological challenges and identifies several research directions for social media analytics in hospitality and tourism.
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Purpose This study aims to measures the effects of managerial response on consumer electronic word-of-mouth (eWOM) and hotel performance. Design/methodology/approach A sample of 56,284 consumer reviews and 10,793 managerial responses for 1,045 hotels was retrieved from TripAdvisor, along with 30,232 performance records matched to these hotels on a quarterly basis. Findings This study finds that managerial response leads to an average increase of 0.235 stars in the TripAdvisor ratings of the sampled hotels, as well as a 17.3 per cent increase in the volume of subsequent consumer eWOM. Moreover, managerial response moderates the influence of ratings and volume of consumer eWOM on hotel performance. Practical implications This study offers a practical model that enables hotel managers to orchestrate social media marketing approaches and efforts toward an optimal social media strategy. Originality/value This study differs from extant literature that has extensively focused on consumer reviews by providing a new perspective of management intervention in the social media context. By examining the interplay of managerial response and consumer eWOM at the individual hotel level, this study provides empirical evidence of managerial response affecting hotel performance through the increased ratings and volume of consumer eWOM. This study also offers insights into the practical importance of crafting intervention opportunities to cultivate the continued engagement of consumers on social media and increased hotel performance.
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The purpose of the paper is to investigate the influence of market accessibility on hotel prices and how this influence is moderated by various quality-signaling factors, such as online user ratings, “thumbs up” (recommendation) percentage, hotel class, and chain affiliation. Using a randomized sample of hotels in the Caribbean islands, we employ a three-level mixed-effect linear regression model to investigate the plausible relationship between market accessibility and hotel prices. After controlling for unobserved island-level and hotel-level characteristics, the model indicates that in most periods, low market accessibility (high flight costs) leads to lower hotel prices, and this influence is mitigated by well-established positive reputations as represented by the quality-signaling factors. Our findings imply that hotels should work to increase their reputations to help buffer the impacts of inaccessibility. In an effort to increase market accessibility, one course of action is to reduce airport landing taxes and fees.
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Understanding consumers’ needs and wants has been a major source of success for hotel organizations. Notwithstanding, investigating the valence of online reviews and modeling hotel attributes and performance is still a rather novel approach. Using partial least squares path modeling, Swiss country-level data for online reviews from 68 online platforms, together with data from 442 hotels, we test 11 hypotheses. Our research model includes three distinctive areas of the hotel: physical aspects, quality of food and drink, and human aspects of service provision. RevPAR and occupancy are employed as performance metrics. We also test for mediation effects. Results indicate that hotel attributes, including the quality of rooms, Internet provision and building show the highest impact on hotel performance, and that positive comments have the highest impact on customer demand. This study contributes to theories of valence on hotel performance and presents salient implications for practitioners to enhance performance.
The focus of this study is customer behavior during the process of booking a hotel through online travel agencies (OTAs). We developed a stochastic programming model to design the optimal sequence of hotels that enables customers to find hotels at the minimum search cost and maximum utility gained from hotels. The number of available hotels in the sequence was strategically decided to minimize search cost. We considered the multidimensional preferences of customers, including price, star rating, review rating, and reservation price. We collected customer information through a survey and took hotel information from a selected OTA. This information was then used through numerical simulations to test the performance of the modeling approach. The results suggest that hotels with higher utility, review rating, star rating, and price should be ranked in the upper position of the sequence. We highlight an application of the proposed model that can help improve hotel performance in today’s competitive market.
Online consumer reviews (OCRs) are increasingly used by consumers to make informed decisions about tourism-related products. However, there is an increase in concern about the level of trustworthiness of OCRs. As yet, little is known about how consumers assess trustworthiness and untrustworthiness of OCRs. This study aims to fill this gap by using a grounded theory approach based on 38 interviews with users of OCRs. Results show that consumers primarily use cues related to the message content and style and review extremity and valence to assess trustworthiness. Findings indicate that moderating variables such as consumer involvement and experience as well as the type of website affects the way consumers assess trustworthiness. Reviews perceived as untrustworthy are discounted by consumers.
In online markets, Word-of-Mouth (WOM) plays a very important role in shoppers' online purchasing decisions, especially for experience goods. Hotels, as a form of service product, are intangible and cannot be evaluated before consumption, which makes WOM even more important. Several studies focus on the influence of online WOM on business performance. However, little attention has so far been paid to the asymmetric effect of WOM resulting from product heterogeneity in service industries. Hotel products can be classified by star ratings, with their services heterogeneous across different classifications. This study investigates the moderating effect of hotel star rating on the relationship between WOM and sales performance. To address the challenge of missing data, we conduct our empirical study using the difference-in-difference approach. Data about 1,689 hotels were collected from two major online travel agencies in China. We show that both the average rating of online WOM and rating variance have a significant impact on sales, and this effect is significantly moderated by hotel star rating. WOM has more impact on sales for hotels with lower rather than higher star ratings. The findings will help researchers and practitioners to understand more about the asymmetric impact of online WOM on service products.
The purpose of this book is to introduce novice researchers to the tools of meta-analysis and meta-regression analysis and to summarize the state of the art for existing practitioners. Meta-regression analysis addresses the rising "Tower of Babel" that current economics and business research has become. Meta-analysis is the statistical analysis of previously published, or reported, research findings on a given hypothesis, empirical effect, phenomenon, or policy intervention. It is a systematic review of all the relevant scientific knowledge on a specific subject and is an essential part of the evidence-based practice movement in medicine, education and the social sciences. However, research in economics and business is often fundamentally different from what is found in the sciences and thereby requires different methods for its synthesis-meta-regression analysis. This book develops, summarizes, and applies these meta-analytic methods. © T.D. Stanley and Hristos Doucouliagos 2012. All rights reserved.