Hospitality business models, customer well-being and trust: the mediating role of competitive service advantage

Abstract

Purpose

This study aims to examine how hospitality consumers of different generations appraise competitive service advantage (CSA) of service providers, based on providers’ business models and value propositions, particularly, how these perceptions influence consumers’ purchase intention, subjective well-being and trust in service provider.

Design/methodology/approach

This study used a 3 × 4 between-within online scenario-based experimental design (business models: traditional, collaborative, shared; value propositions: innovation, marketing, service production, recovery) using equal and randomized assignment to experimental conditions. Following equal quota-based randomized sampling, three generations were examined (n = 180): baby boomers, Generation Xers and millennials. Multivariate analysis of variance and PROCESS macro were used to analyze the data.

Findings

Hospitality consumers perceived value propositions from providers with different business models inversely based on their perceptions of firms’ CSA, subjective well-being and trust. CSA amplified the outcomes and served a mediating role for purchase intention, subjective well-being and trust. Different outcomes were based on generational cohorts.

Practical implications

Customer perceptions of firm’s unique competitive position should be managed holistically by combining business models, value propositions and generational cohorts to ensure customers’ purchase intention, trust and subjective well-being. CSA should be communicated to customers differently based on generational membership.

Originality/value

This study deepens knowledge of CSA, specifically from the consumer level of analysis. The key contribution is the role of CSA as a mediator for hospitality business models and customer-related outcomes of purchase intention, subjective well-being and trust. This study brings forward consumer subjective well-being as a potential goal for hospitality firms.

Citation

Shulga, L.V., Busser, J.A. and Bai, B. (2021), "Hospitality business models, customer well-being and trust: the mediating role of competitive service advantage", International Journal of Contemporary Hospitality Management, Vol. 33 No. 9, pp. 3040-3064. https://doi.org/10.1108/IJCHM-09-2020-1033