Budget hotel performance based on customers’ perspective and competitive strategy

Abstract

For tourists, the speed and ease of access to tourist sites is an important factor when traveling. This prompts the concept of an affordable and comfortable hotel (budget hotel). The study aims to analyze the impact of competitive strategy and dimensions to hotel performance. The dimensions of competitive strategy consist of brand image, human resources, information technology, and service quality, all of which are taken into consideration for this study. Hotel performance is measured by a single dimension namely from the customer’s perspective (customer-based performance). Data is collected and processed from 200 budget hotel consumers in the Island of Bali, which is considered a national tourism parameter in Indonesia. The data processing tool employed is SEM (Structural Equation Modeling). The study found a positive effect of competitive strategy and its dimensions, namely brand image, human resources, information technology, and service quality toward hotel performance. Furthermore, information technology is found to be the strongest factor affecting hotel performance. However, brand image is the most important factor in the competitive strategy dimension of budget hotels. For further research, it is suggested to research hotel performance using multiple performance measurements.