ENTER2017 eTourism Conference presentation

1. ENTER 2017 PhD workshop Slide Number 1
EXPLORING DAILY DEALS AS A DISTRIBUTION
CHANNEL AND A POTENTIAL DRIVER OF
HOTEL PERFORMANCE
Author: Miha Bratec, FELU
Supervisor: Tanja Mihalič, FELU
FELU, University of Ljubljana, Slovenia
Miha.bratec@ef.uni-lj.si
http://www.ef.uni-lj.si

2. ENTER 2017 PhD workshop Slide Number 2
To Deal or not to Deal!?
• Definition of DDs (Berezina et al, 2016):
• DDs are a novel form of heavily discounted intermediaries selling
distressed inventory to customers who previously agreed to
become members of the channel.
Useful for:
• Targeted intermediation (Berezina et al, 2014,
Berezina et al, 2016; Dev & Piccoli, 2013)
• Pricing differentiation (Berezina et al, 2016; O’Grady, 2014)
• Sales stimulation (Sigala, 2014; Cassia et al, 2015)
• Seasonality mitigation (Cassia et al, 2015)
• Yield generation (O’Grady, 2014)
But:
• Conflicting evidence over their usefulness to boost performance
(Gupta & Keiningham, 2012; Dholakia, 2011)
• Evaluation of DDs’ success only vaguely defined (Berezina et al,
2016)
• No study testing DDs’ impact on other distribution channels nor on
hotel profitability available

3. ENTER 2017 PhD workshop Slide Number 3
Motivational Rationale
• Hands-on experience in the field of digital distribution
• Business relevance of the topic
• Discrepancies between the business reality and existing
academic inquiry

4. ENTER 2017 PhD workshop Slide Number 4
Field, Purpose and Approach
• Hotel digital distribution
• Set to analyse the implications of DDs within the
digital distribution and answer basic questions
remaining unanswered by the state-of-the-art
scientific inquiry and practitioners.
• Exploration of a real life multi-disciplinary business
problem

5. ENTER 2017 PhD workshop Slide Number 5
Field, Purpose and Approach (continued)
Action research paradigm, or paradigm of praxis
(O’Brien, 1998; Lashley, 2000; Kaše, 2016):
•Research problem = Actual problem
•Should result in action to overcome particular problems 2 goals: solve a
problem and contribute to science
•Aims at developing holistic understanding
•Can include all types of data-gathering methods
•The choice of the method is led by the question that is being addressed

6. ENTER 2017 PhD workshop Slide Number 6
Purpose, Aims, Structure

7. ENTER 2017 PhD workshop Slide Number 7
LQ1: Why is there a need for a special discounted
channel in the hotel digital distribution landscape?
•Literature review focusing on:
•Is it really new?
•What does it add?
•What does it change in the market?
•What are its implications for:
• Hoteliers
• Customers

8. ENTER 2017 PhD workshop Slide Number 8
LQ2: How successful and useful are the DDs
as a distribution channel when compared
to the OTAs?
• Evaluating the managerial use of DDs: what, when, why, how…
• Using OTAs, the longer established & (over)dominant distribution
channels as a benchmark
• Can the DD success be evaluated with similar metrics as the OTA
performance
• Can DDs become a serious competitor to OTAs in terms of their
distribution power?

9. ENTER 2017 PhD workshop Slide Number 9
LQ2 Methodology:
• Qualitative survey
• Semi-structured interview with 10-15 hotel managers from Slovenian,
Croatian, Hungarian & Austrian hotels
• Thematic analysis of data using NVivo software
• Outcome: Rich data uncovering the main attributes and drawbacks of
DDs channels when benchmarked against the OTAs. Insights on
current use, perceived usefulness & problems of using DDs and
evaluating their performance.

10. ENTER 2017 PhD workshop Slide Number 10
LQ3: How does the use of DDs impact other distribution
channels and consequently also hotels’ profitability?
• Solving the practical problem which includes characteristics of:
• OTA’s Billboard Effect (Anderson, 2009)
• Sales stimulation (Sigala, 2003)
• Push and pull function (Boon et al, 2012)
• Channel conflict (Myung & Bay, 2009; Tan & Dwyer, 2011)

11. ENTER 2017 PhD workshop Slide Number 11
LQ3 Methodology
• Pure action research, or as per Gumesson (2000) ‘the most demanding
and far reaching method of doing case study research’
• working together with the hotel’s revenue management and sales team:
scheduling interventions and observing the changes while recording the
performance (prior, post and long-term) in the hotel’s PMS, website and
OTA analytics.
• Combined use of quasi experiment and case study approach
• Seeks to measure causal relationship between the use of DDs and:
• performance of hotel’s website (visitors & sales)
• performance of hotel’s OTA listing (Booking.com
visitors & sales)
• hotel’s financial performance (KPIs: Occupancy
levels, ADR, RevPAR, GOP)

12. ENTER 2017 PhD workshop Slide Number 12
Contribution

13. ENTER 2017 PhD workshop Slide Number 13
Dilemmas...How to improve...
• Lack of theoretic foundations… more a consultancy than a PhD
project… Seeing the problem through the glasses of a
practitioner…
• Lack of clear discipline…
• Aims not set precisely enough…
• Existing PhDs covering similar topics all using grounded theory
approach from which my comitee discourages me…

14. ENTER 2017 PhD workshop Slide Number 14
Dilemmas...How to improve...
asist. Mag. Miha Bratec
Faculty of Economics,
University of Ljubljana
E-mail: miha.bratec@ef.uni-lj.si