The Determinants Affecting to ADR of City Hotels in Thailand

Abstract

          The aim of this research is to identify the difference of the determinants which affect to the ADR (Average Daily Rate) of the hotels in Bangkok and the city hotels in other provinces. Hedonic Price Modeling was applied to analyze the determinants, where ADR was the dependent variable and the independent variables were derived from literature review or suggested by an expert panel. Factor analysis was then adopted to merge the high correlation independent variables. The data from 461 hotels in Bangkok and 335 hotels in provincial city hotels in all regions of Thailand were collected fromwww.agoda.com which is the most popular hotel reservation website in Thailand. The results showed that several determinants are significant in both groups of hotels, e.g. star rating, some hotel facilities, and room size, but there are some determinants being significant only in Bangkok such as location overview, distance to airport, and hotel’s brand. In addition, the distance from CBD (Central Business District) and the hotel’s region is significant only in provincial city hotels. The results can clarify the characteristics of the city hotels in Thailand and can be used in the investment and development decision making of the hotel developers in Thailand. Furthermore, the acquired ADR prediction models for hotels in Bangkok and city hotels in other provinces can provide useful information for investors or developers regarding hotel value appraisal, or pricing hotel’s room rates.