Does advertising spending improve sales performance?. (July 2015)

• Record Type: Journal Article
• Authors: George Assaf, A.; Josiassen, Alexander; Mattila, Anna S.; Kneževic Cvelbar, Ljubica
• Is Part Of: International journal of hospitality management. Volume 48(2015)
• Page Start: 161
• Page End: 166
• Publication Date: 2015-07
• Subjects: Advertising spending -- Sales performance -- Size -- Star rating -- Dynamic frontier modelling; Hotel management -- Periodicals; Restaurant management -- Periodicals; Food service management -- Periodicals; Hôtels -- Gestion -- Périodiques; Restaurants -- Gestion -- Périodiques; Services alimentaires -- Gestion -- Périodiques; Food service management; Hotel management; Restaurant management; Periodicals; 647.94
• DOI: 10.1016/j.ijhm.2015.04.014
• Languages: English
• ISSNs: 0278-4319

Abstract

Abstract: Hotel managers and investors commonly analyze the impact of advertising spending on firm performance. This paper investigates such an impact using a comprehensive framework incorporating the moderating effects of hotel size and star ratings. We estimated sales performance via dynamic, stochastic frontier modelling. Using longitudinal data from a sample of Slovenian and Croatian hotels, we demonstrate that advertising spending has a positive impact on hotel sales performance, and that the relationship strengthens for larger hotels and hotels with higher star ratings. Theoretical and managerial implications along with directions for future research are also discussed.