Can inconsistent media coverage increase hotel survival? The bright side of controversy

Abstract

Purpose The impact of a mixture of positive and negative media coverage on long-run hotel survival remains unknown. This paper aims to investigate how the mixed positive and negative media coverage, namely, inconsistent media coverage, influences long-run hotel survival. Design/methodology/approach A yearly panel data set covering 792 news-reported hotels in Guangdong province of China, over the period 2010–2020, is analyzed using an inconsistency analysis framework consisting of text mining and survival analysis. The estimates of exponential models on the same observations and Cox estimates on alternative observations are used for robustness checks. Findings The inconsistency calculation method proposed here can measure the controversy degree well. There exists a U-shaped relationship between inconsistency of media coverage and hotel longevity, and hotel survival is significantly reduced only when the degree of inconsistency is within the range of 17.8%–53.6%. The U-shaped relationship is moderated by negative hotel image and by online media coverage on hotel operation strategy topics. Practical implications This study provides suggestions for hotel managers to use media coverage inconsistency to increase long-run hotel survival in the digital era. Originality/value To the best of the authors’ knowledge, this paper is one of the first to investigate long-run hotel survival factors from the perspective of media coverage inconsistency. It also proposes a method to calculate the degree of media coverage controversy, which helps to quantify the relationship between the degree of inconsistency and hotel survival.

A Literature Review on the Financial Determinants of Hotel Default

“…Another sub-filter regarding study relevance is the exclusion of ex ante bankruptcy risk assessments that do not deal with actual bankruptcies or a measure of financial distress, where the aim is to project a future potential credit profile for hotels (Gallo et al 2018;Matejić et al 2022;Špiler et al 2022;Vivel-Búa et al 2018). Studies dealing explicitly with the going concern issue (Fernández et al 2018;Zhai et al 2015) and a recent study where the only financial metric, the initial injected capital, which can be considered a balance sheet item, was not promoted in the final model (Yuan et al 2023), are excluded too. In total, the in-depth screening filter removed 25 studies.…”