Should Hotels Respond to Negative Online Reviews?

Abstract

The purpose of this study was to determine whether it is beneficial for service providers, such as hotels and restaurants, to respond to online negative reviews, and (a) whether company reputation is moderated by the number of negative versus positive reviews and (b) whether the underlying issue is attributed to controllable versus uncontrollable factors. To test the hypotheses, a 2 × 2 × 2 quasi-experimental design was utilized. Respondents were asked to imagine that they were planning a trip to New York City, were searching online for a hotel near Times Square, and were provided with several reviews. The results indicate, in general, that company reputation is adversely affected as the number of negative to positive reviews becomes greater. When service failures pertain to controllable factors, management responses can mitigate the adverse effects of negative reviews. When service failures stem from uncontrollable factors, company reputation is not adversely affected, and thus a response from management might not be necessary. A follow-up study examined whether the type of response matters. Findings revealed that an apology with assurance versus an apology with correction action is equally effective.

Management Response to Online Customer Reviews in Distribution Channel: A Perspective of Manufacturers

“…Specifically, some important characteristics of management response, including the total number of management responses, the length and response time, have a positive relationship with hotel financial performance [35,36]. Besides, management responses can mitigate the effect of negative reviews on brand or firm evaluations [25,31] and improve firms' online reputation by increasing hotel ratings [24].…”

An Investigation into Management Response to Negative Online Reviews in Hotel Operations

“…Furthermore, in their attempt to assess the influence of OLRs, some researchers (Li et al, 2015; Banerjee and Chua, 2016; Liu and Park 2015; Radojevic et al, 2015) used web crawlers in order to quantitatively determine how third party platforms use algorithms to rate hotels as to service quality, value for money and customer satisfaction. Others (Kusumasondjaja et al, 2012;Rose and Blodgett, 2016), created hypothetical settings where customers were asked to imagine planning a trip and then provided with several reviews in order to measure the effect these may have on their travel choice behavior. Witnessing such a growing need of information on part of potential travelers as well as increasing concern to hotel operators, the main aim of this research is to investigate the degree of attention management has assigned to monitor online consumer generated content and how this process is handled on its part.…”

“…Xie et al, 2016); not much research has addressed the issue of assessing the effectiveness of hotel marketers' response to OLRs(Rose and Blodgett, 2016). As a matter of fact, hoteliers have been criticized in not making enough investment in online reputation management (ReviewPro, 2014) despite the academic guidance that research has presented Lee et al, (2012).…”

Guest preferences for service recovery procedures: conjoint analysis

“…The extent of successful recovery depends on the type of failure (Lewis and McCann, 2004;Noone and Lee, 2011;Wirtz and Mattila, 2004), severity/magnitude (Lewis and McCann, 2004;Sreejesh and Anusree, 2016), stability (O'Neill and Mattila, 2004), and controllability (Rose and Blodgett, 2016). In a service failure context that does not involve monetary costs to the consumer, consumers may prefer psychological compensation, a good recovery process, to receiving compensation (Wirtz and Mattila, 2004).…”

“…For controllability, in the context of online reviews, Rose and Blodgett (2016) examined the effects of type of failure and response on negative reactions. They found the type of failure and response mattered to guests' negative reactions; when service failures are viewed controllable, management responses can mitigate the adverse effects of negative reviews.…”