Playing for First Place: An Analysis of Online Reviews and Their Impact on Local Market Rankings

Whereas past research studied the impact of online reviews on a hotel’s image, the present study analyzes the impact of various measures of customer engagement on the local market ranking of a hotel. For these purposes, the researchers collected data on a sample of hotels including the number of reviews, absolute rating (i.e. 1-5 stars), and market ranking (i.e. 1st, 2nd, 3rd place) on TripAdvisor. The authors tested the relationships between number of reviews, market ranking, overall rating and number of booking transactions. Results revealed that the absolute rating of the hotel was a significant factor in determining its market ranking, whereas other elements such as the number of reviews were not. Since the logarithm used by TripAdvisor and other review sites is of a proprietary nature, research that illuminates the relationships between overall rating, market ranking, and number of reviews, helps illuminate scholar’s and practitioner’s understanding of how to improve hotel performance and online image