| Article ID: | iaor200970776 |
| Country: | United Kingdom |
| Volume: | 8 |
| Issue: | 5 |
| Start Page Number: | 469 |
| End Page Number: | 473 |
| Publication Date: | Nov 2009 |
| Journal: | Journal of Revenue and Pricing Management |
| Authors: | Walker Thomas M |
| Keywords: | discounts |
In 2004, Mark Lomanno of Smith Travel Research, together with Linda Canina and Cathy Enz, Cornell University, published what has proven to be an influential paper titled 'Why Discounting Doesn't Work: The Dynamics of Rising Occupancy and Falling Revenue Among Competitors'. The paper concludes that hotels discounting more aggressively than their competitors achieve a comparative occupancy premium, but that the increase does not offset the room rate sacrifice, eroding Revenue Per Available Room (RevPAR) compared with competitors. This paper tests the argument's soundness in terms of data reliability and methodology. If the authors' case is flawed, hotels according it undue credence could be hurt.