Evaluating the impact of mega-sporting events on hotel pricing strategies: the case of the 2014 FIFA World Cup

Albert A. Barreda (Department of Hospitality Leadership, Missouri State University, Springfield, Missouri, USA.)
Sandra Zubieta (Carrera de Administración Hotelera, Universidad San Ignacio de Loyola, Lima, Peru.)
Han Chen (Department of Nutrition, Dietetics, & Hospitality Management, Auburn University, Auburn, Alabama, USA.)
Marina Cassilha (Carrera de Administración Hotelera, Universidad San Ignacio de Loyola, Lima, Peru.)
Yoshimasa Kageyama (Department of Hospitality Leadership, Missouri State University, Springfield, Missouri, USA.)

Tourism Review

ISSN: 1660-5373

Publication date: 19 June 2017

Abstract

Purpose

This study aims to examine the impact of a mega-sporting event “2014 FIFA World Cup” on hotel pricing strategies and performance.

Design/methodology/approach

The present project examines the host regions’ response to the 2014 FIFA World Cup which was established by the variance in the main hotel key performance indexes: occupancy, average daily rate, revenue per available room (RevPAR) and supply. Using data gathered from STR, this research distinctly shows how the Brazilian host regions reacted to the World Cup.

Findings

Results suggest that the key performance indicators of Brazil’s lodging sector reacted differently to the World Cup. Although all hosting cities experienced significant RevPAR growth because of the increase in hotel room rates during the event, the supply and occupancy performed differed from each city.

Research limitations/implications

Research is limited to the case of hotel performance at the country level for mega-events. The study focused on the reaction of revenue managers in the Latin America context. Other contexts may generate different results.

Practical implications

The study helps revenue managers to examine how the FIFA World Cup travel demand affected pricing strategies and revenue management practices in the Brazilian hotel sector in areas undergoing seasonal growths in overnight tourism. This study serves to inform hoteliers and practitioners about revenue management pricing strategies to improve hotel performance during mega-sporting events.

Social implications

This study reveals that the benefits brought by a mega-event are not always translated into strong hotel revenue performance. This study highlights an important but understudied research area of revenue management pricing strategies and the effect of mega-sporting events in the hotel sector. This study contributes to the literature as one of the few investigations to benefit hotel pricing strategies and overall revenue performance.

Originality/value

This study is one of the few studies about exploring the reaction of revenue managers during the execution of a mega-sporting event. The value of the present study lies in the fact that the authors extend previous studies examining the impact of the most important sporting event in the hotel industry at the country-level perspective. This study serves to inform hoteliers and practitioners about revenue management pricing strategies to improve hotel performance during mega-sporting events.

Keywords

Citation

Albert A. Barreda, Sandra Zubieta, Han Chen, Marina Cassilha and Yoshimasa Kageyama (2017) "Evaluating the impact of mega-sporting events on hotel pricing strategies: the case of the 2014 FIFA World Cup", Tourism Review, Vol. 72 No. 2, pp. 184-208

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DOI

: https://doi.org/10.1108/TR-02-2017-0018

Publisher

:

Emerald Publishing Limited

Copyright © 2017, Emerald Publishing Limited

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