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Article
Publication date: 11 January 2016

Pietro Beritelli and Roland Schegg

Hotel managers are being challenged by the increasing multitude of distribution and sales channels. Online travel agencies (OTAs) in particular generate a great deal of…

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Abstract

Purpose

Hotel managers are being challenged by the increasing multitude of distribution and sales channels. Online travel agencies (OTAs) in particular generate a great deal of uncertainty: Which are the best ones? Which ones offer the best conditions? How many channels are optimal for my hotel? How can I evaluate costs versus benefits? These and other questions concerning the optimal online distribution channel strategy have produced different reactions in practice. The aim of this paper is to challenge the need for an over-optimization of channel strategy by proposing that the consumer, at the end, deals with a network of information presented on one networked environment, including the Web. Hence, the network effect of the numerous online platforms is what drives consumer choice and, finally, bookings.

Design/methodology/approach

A series of multiple regressions with representative samples of hotels in Switzerland from the years 2009, 2010, 2011 and 2012 was performed to estimate the importance of the number of platforms against other independent variables. Additionally, further multiple regressions with samples from the years 2011 and 2012 using the most important platforms (first-tier channels) shows again that the number of platforms is more important.

Findings

The analyses show that the estimated number of online bookings by the respondents in the hotels is a result of the number of channels, not the type of channel. This is particularly true for non-categorized establishments and one- and two-star hotels. The analyses do not confirm the billboard effect, according to which particular platforms (first-tier channels) increase the probability of bookings. Thus, the survival strategy is to maximize share of shelf and to build on interdependencies and network effects.

Research limitations/implications

The study looks only at online bookings. Additional research into the connection between online and offline channels, particularly from the viewpoint of the consumer, will provide further insights. The study looks at the booking volume per channel, not the monetary sales volume or the profit. A study that quantifies not only the volume of bookings but also the total profit or the contribution to profit per channel could quantify the benefits of the multi-channel strategy.

Originality/value

The multiple online channel strategy seems to be the more effective approach to maximizing bookings online, regardless of the platforms chosen. Results of the study challenge the current opinion among practitioners that the multitude of distribution channels forces them to choose among single online channels and, therefore, drives the search for criteria to assess these channels or even to disregard them. The consistent results across 2009-2012 show that even in the turbulent phase of the advent of OTAs in the travel industry, hotels can adopt a winning strategy. Finally, the results suggest that the intermediation of online distribution of hotel beds has approached the condition of perfect competition, causing the OTA business model to be cannibalized.

Details

International Journal of Contemporary Hospitality Management, vol. 28 no. 1
Type: Research Article
ISSN: 0959-6119

Keywords

Article
Publication date: 24 August 2010

Basak Denizci Guillet and Rob Law

This paper aims to examine hotel star ratings on selected third‐party distribution websites, taking Hong Kong hotels as the sample.

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Abstract

Purpose

This paper aims to examine hotel star ratings on selected third‐party distribution websites, taking Hong Kong hotels as the sample.

Design/methodology/approach

Star rating information from 11 online distribution websites was retrieved and analyzed for all hotels in Hong Kong.

Findings

About 60 percent of the hotels were found on at least six of the selected distribution channels, and only 24 percent of the hotels have consistent star rating across different distribution channels. Results of data analysis indicated that consistent star rating becomes more difficult to maintain as the number of distribution channels used increases.

Research limitations/implications

Findings of the study are limited to the selected hotels and electronic distribution channels. Still, the online distribution channels represent some of the most widely used electronic distribution channels.

Practical implications

Findings of this research will be of use to hotel managers and guests for better understanding the standard, in terms of star ratings, of hotels.

Originality/value

Despite the importance of hotel star ratings on consumers and the hotel industry, prior studies in the existing hospitality literature rarely examined the difference of hotel stars. This novel study should, thus, make a meaningful contribution to knowledge development.

Details

International Journal of Contemporary Hospitality Management, vol. 22 no. 6
Type: Research Article
ISSN: 0959-6119

Keywords

Article
Publication date: 1 June 2001

Niels Peter Mols

Explores why some retail banks more than others are vigorous in their promotion of and have been successful in changing their distribution channel structure by introducing…

3664

Abstract

Explores why some retail banks more than others are vigorous in their promotion of and have been successful in changing their distribution channel structure by introducing new electronic channels, such as PC banking and Internet banking. A tentative model is proposed relating a number of variables to the banks’ promotion and successful introduction of the electronic channels. Responses from 60 key managers in the largest retail banks in Denmark indicate that bank size, expected advantages for the customers, attention to the future, senior management support, and willingness to cannibalize existing channels may be important factors in explaining the successful introduction of the electronic channels. Further, the results indicate that different attitudes and perceptions are related to different means of attracting customers to the electronic channels. Finally, discusses the implications for the banks and other firms of adopting the Internet as a distribution channel.

Details

European Journal of Marketing, vol. 35 no. 5/6
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 19 November 2006

Prescott C. Ensign

This paper presents a systematic method for classifying research on international channels of distribution. It is used to examine 79 articles published during an 18‐year…

Abstract

This paper presents a systematic method for classifying research on international channels of distribution. It is used to examine 79 articles published during an 18‐year period (1988‐2005). Based on content analysis, each article is classified by its primary research framework. Two frameworks are identified: (1) structural ‐ based on the economic and organizational aspects of international channels of distribution; and (2) behavioral ‐ based on the exchange relationship between channel members from different national environments. This simple organizing system offers a comprehensive way to analyze scholarship that has emerged in the field. For managers, it can bring the theoretical and practical developments together in an understandable fashion as they seek to interpret and apply research findings. For scholars, it may bring focus to an increasingly complex area of international business and guide future research efforts.

Details

Multinational Business Review, vol. 14 no. 3
Type: Research Article
ISSN: 1525-383X

Keywords

Article
Publication date: 1 July 1978

John Gattorna

Channels of distribution are basic to the marketing strategies of firms, and have been shown to be a key element in the marketing mix. The author here undertakes a…

Abstract

Channels of distribution are basic to the marketing strategies of firms, and have been shown to be a key element in the marketing mix. The author here undertakes a comprehensive review of channels literature, primarily to identify and assess the adequacy of the various mainstream conceptual schemes which have emerged. Economic‐based arguments have largely been at the core of channels literature, although these have been partially offset by the concepts of the organisational and behavioural schools. The author concludes that whereas every conceptual approach reviewed has added something to our cumulative knowledge, no single approach has yet reached a point of adequate conceptualisation based on his own basic criteria. As yet channels literature is mainly descriptive, and has virtually no predictive power.

Details

European Journal of Marketing, vol. 12 no. 7
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 18 May 2020

Amalina Andrade and Karen A. Smith

This paper investigates tourism distribution channels in a small island destination with capacity constraints and contributes to understanding distribution in an emerging…

Abstract

Purpose

This paper investigates tourism distribution channels in a small island destination with capacity constraints and contributes to understanding distribution in an emerging economy. Using the case of Fernando de Noronha in Brazil, the structures and factors underlying channel choice behaviour of tourism suppliers and intermediaries were investigated.

Design/methodology/approach

41 in-depth interviews were conducted with the private sector (tourism suppliers based on Fernando de Noronha and intermediaries, based on the island as well as mainland Brazil) as well as governmental organisations. A stratified purposeful sample was taken to select suppliers and data were examined based on thematic analysis.

Findings

Both direct and indirect distribution channels are used, with limited airline tickets influencing the suppliers' choice of channels in this small island and capacity-constrained destination. Many suppliers focused on relationships with destination-based ground operators. These local intermediaries are important and extremely relevant to small island destinations building an effective business network to connect the destination to geographically distant markets and intermediaries.

Research limitations/implications

Limitations include the absence of air and cruise operators as interviewees.

Originality/value

The paper provides a comprehensive representation of the structures and analysis of tourism distribution channels in fragile small island destinations, specifically, in an emerging country context. This includes emphasising previously unexplored indirect channels of cruise ship operators and supplier's associations.

Details

Journal of Hospitality and Tourism Insights, vol. 3 no. 2
Type: Research Article
ISSN: 2514-9792

Keywords

Article
Publication date: 8 January 2018

M. Claudia Tom Dieck, Paraskevi Fountoulaki and Timothy Hyungsoo Jung

Advances in information communication technologies (ICTs) have changed the tourism distribution channels model, as traditional players continue to disappear or change…

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Abstract

Purpose

Advances in information communication technologies (ICTs) have changed the tourism distribution channels model, as traditional players continue to disappear or change their business model, while new players and channels emerge because of technological developments. Therefore, this study aims to propose a tourism distribution channels model for European island destinations.

Design/methodology/approach

Using an exploratory approach, interviews with 34 tourism stakeholders were conducted at ITB Berlin and WTM London in March 2014 and March/November 2016, and analyzed using thematic analysis.

Findings

The findings revealed that a number of changes have taken place within the distribution channels market over the past six years. The disappearance of incoming travel agents has increased, while new forms of online communication and distribution have appeared. In particular, social media, online review sites and mobile channels play an increasingly important role for hoteliers.

Practical implications

ICTs change the online landscape for tourist distribution in island destinations, and practitioners should make use of new online channels and be aware of disappearing tourism players to remain competitive.

Originality/value

First, this paper provides indications for the increased disintermediation in regard to incoming travel agents within the Cretan hospitality and tourism industry. Second, it investigates the issue of tourism distribution channels using a broad range of key tourism and hospitality players to provide a tourism distribution channels model for future reference. Finally, this study offers implications for the development of distribution strategies for tourism businesses and hoteliers in Crete.

Details

International Journal of Contemporary Hospitality Management, vol. 30 no. 1
Type: Research Article
ISSN: 0959-6119

Keywords

Article
Publication date: 15 June 2015

Gopalakrishnan Narayanamurthy and Anand Gurumurthy

This study aims to understand the structure of downstream network from a supply chain (SC) perspective using a case of an Indian alcoholic beverage manufacturing company…

Abstract

Purpose

This study aims to understand the structure of downstream network from a supply chain (SC) perspective using a case of an Indian alcoholic beverage manufacturing company. In the SC literature, many researchers and practitioners have studied the design of upstream supplier network. Very few studies have documented the design of downstream network comprising distributors, warehouses, retailers, etc. and current study attempts to contribute to this limited literature. In addition, this study also tries to understand the influence of downstream SC, if any, on top management strategies. Finally, it assesses the SC quality using the standard set of factors and provides insights for its improvement.

Design/methodology/approach

Single case study approach has been utilized to understand the configuration of downstream SC. A distillery in southern part of India which distributes a variety of liquor products across the market has been chosen for this study. Different data collection approaches have been adopted to understand the distribution channels prevailing in the market. In addition to the internal documents, semi-structured interviews were conducted with salesmen employed by the distillery for different group of outlets, top management of the distillery, outlet owners and counter sales person.

Findings

Different distribution channels constituting the downstream SC network of the industry in the market studied have been identified to be retails and bars, institutions, clubs, modern trade, maximum retail price and Mysore Sales International Limited. Each of the distribution channels has clearly defined their boundaries for reaching different segment of consumers. Significant influence of the existing distribution channels on strategic decisions such as new product development and pricing were noticed. Interesting inferences were obtained on the relationships existing between the distilleries and different distribution channels. Insights were also gathered on the regulatory role played by the government between the manufacturers and distributors. Few marketing and promotional strategies adopted by companies to strengthen their downstream relationships with distribution channels and, in turn, with consumers have also been discussed. The quality of alcoholic beverage SC has been assessed and was found to perform on par with the set standards of quality in robustness factors and enabling factors. Training factor needs to be further improved by providing salesmen with exposure to best practices. Effort also needs to be taken to improve in the complicating factors, i.e. the testability and time.

Research limitations/implications

This study is limited to the experience of a single alcoholic beverage manufacturer in the Karnataka state in India. SC of alcoholic beverage industry in India varies across states and depends on State Government regulations. Hence, the obtained results and inferences cannot be generalized across the industries and geographies. Future studies can be carried out in different locations across the country to understand the structure and dynamics of downstream SC in this industry. Scope also exists to study how the deficiencies identified in the SC can be improved and how alcoholic beverage firms entering India adapt to the prevailing SC structure. Comparative study of downstream SC of different industries can also be conducted.

Practical implications

Academicians and practitioners can consider this paper as a source to understand the configuration of downstream SC of alcoholic beverage industry. More than that, this study provides a counter-intuitive inference for researchers and practitioners that choice of distribution channels have influence on the strategic decisions such as pricing and product development. Therefore, it becomes necessary to factor in the target distribution channel at the product design phase itself. This study may also help in performing a comparative study of downstream SC – especially the distribution network of different industries and identify best practices that can be adopted across the industries. Application of the standard set of factors from the food SC quality assessment literature have been demonstrated in this study to assess the downstream SC of the alcoholic beverage industry studied. In addition, this study provides several insights by detailing the structure of the SC for other alcoholic beverage manufacturers who are planning to enter Indian market.

Originality/value

According to author’s knowledge, it is believed that this is the first study to report the configuration of downstream SC of the alcoholic beverage industry specifically from India apart from describing their influence on strategic decisions of the company.

Details

Journal of Indian Business Research, vol. 7 no. 2
Type: Research Article
ISSN: 1755-4195

Keywords

Article
Publication date: 1 June 2001

Jennifer Thornton and Lesley White

This research examined the survey responses of 801 financial customers who provided information regarding their usage of, and attitudes towards, financial distribution

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Abstract

This research examined the survey responses of 801 financial customers who provided information regarding their usage of, and attitudes towards, financial distribution channels. The study found that there were distinctive segments within the financial market that had significantly different levels of usage of financial distribution channels. Financial customers were asked to indicate their orientation towards convenience, service, technology, computers, change, knowledge about methods of accessing money, and confidence in using electronic banking. Financial customers’ usage of human tellers, automated teller machines, electronic funds transfer at the point of sale, credit cards, cheques, Internet banking and telephone banking was investigated, and this information was used to determine if relationships exist between customer orientations and the usage of financial distribution channels. Further results and implications of the study for financial services are addressed.

Details

Journal of Services Marketing, vol. 15 no. 3
Type: Research Article
ISSN: 0887-6045

Keywords

Article
Publication date: 19 September 2008

Filipe Coelho and Chris Easingwood

The purpose of this paper is to aim to understand the factors influencing the magnitude of change in distribution channels. Distribution channels are slow to change due to…

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Abstract

Purpose

The purpose of this paper is to aim to understand the factors influencing the magnitude of change in distribution channels. Distribution channels are slow to change due to a number of factors. Yet, the distribution mix is a vital part of a company's competitive position and companies must, therefore, constantly examine their mix of channels to most closely approximate the changing needs of its customers. It therefore is important to look at the factors influencing change in distribution.

Design/methodology/approach

A model of channel change is developed and tested with data from financial services organizations in the UK. In addition to quantitative data, the researchers also collected qualitative feedback.

Findings

The degree of channel change is related to: volatility in customers' needs; the sophistication of the target customer; product sophistication; environmental conflict; volatility in competitors' strategies; scope economies; and company size.

Research limitations/implications

The sample size is relatively modest, although this has not prevented the emergence of significant results.

Practical implications

The results of the study are important for both academics and practitioners. It helps alert practitioners to the factors that affect channel change. For academics, it demonstrates that this complex subject can be researched. It also raises some research issues that might be taken on board in future studies.

Originality/value

This article is one of the first to test a set of hypotheses regarding the drivers and inhibitors of change in distribution systems at the micro level.

Details

European Journal of Marketing, vol. 42 no. 9/10
Type: Research Article
ISSN: 0309-0566

Keywords

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