Corsican study suggests hotel rates not affected by classification
Hotel classification systems, most commonly by number of stars, are widely used in many countries as a guide to the level of facilities and standard of service on offer. According to a UNWTO report in 2015, “hotel classifications can provide useful marketing platforms for individual hotels and for destinations wishing to promote the quality of their offer.” However, there is no worldwide standard for official hotel classification systems. Not all countries have any formal system - in Finland, no classification system is in use and hotels are ranked through customers' reviews posted on websites. In other countries there are informal classification systems provided by private organizations, while in others official classiifcation systems can be statutory(e.g., Belgium, Denmark, Estonia, Italy) or voluntary (e.g. Czech Republic, France, Germany). For any voluntary scheme, hotels must make a judgement as to whether the benefits in terms of increased bookings, or ability to charge a premium due to number of stars awarded, are worth the costs involved in inspections and listing. A Working Paper by Beaumais and Giannoni from the University of Corsica examines whether entering a hotel classification system increases the rates the hotel can charge.
The study assesses a sample of 357 hotels of Corsica, while proposing a novel methodology to appropriately analyze the data. France has a voluntary rating scheme from one to five stars, with the rating granted for five years. The data set includes 67 unrated hotels, along with rated hotels excluding 1- and 5-star hotels due to their very small numbers. The analysis includes 38 possible hotel attributes, along with published off-peak and peak hotel rates voluntarily given by hotel managers to the Corsican Tourism Agency in order to be published on the advertising page of the hotel on the agency website. Using a recursive semi-ordered probit model described in detail in the paper, the authors suggest that in contrast to previous research, classification does not provide any rate premium.
A free text search of the Leisure Tourism database for hotels AND classification finds nearly 300 records, while searching for the terms in the index field de:(hotels AND classification) currently returns 81 results. Maravic (2016) discusses whether Slovenia should have an accommodation classification system, and finds that the majority of respondents support a mandatory classification system, which should be used for informing tourists, and administered by the relevant government ministry. The majority of respondents favour a harmonized European system of hotel classification: Hotelstars. Lupu and Nica (2010) discussed hotel classification systems and reported that the Hotelstars common system had been launched by seven countries, Germany, Austria, Hungary, Switzerland, Czech Republic, Sweden, and the Netherlands. Aguilar Quintana and Henning (2013) consider the development of a common hotel classification system in Europe and whether Spain should join a common system. Talias (2016) discusses the voluntary regulation scheme used in Israel. Nunez-Serrano et al. (2014) ask whether stars are a good indicator of hotel quality, and suggest that there is significant overlapping with regard to levels of quality between adjacent official categories.
Reference
Olivier Beaumais and Sauveur Giannoni (2017). Insiders vs outsiders in the hotel sector: is it worth entering an official classification system? Working Paper TerRA n°06, University of Corsica.