Academic journal article International Journal of Marketing Studies

Tourist Preferences and Cost Efficiency of International Tourist Hotels in Taiwan

Academic journal article International Journal of Marketing Studies

Tourist Preferences and Cost Efficiency of International Tourist Hotels in Taiwan

Article excerpt


This paper analyzes the effects of tourist nationality sources on international tourist hotels' (ITHs) cost efficiency in Taiwan and the factors affecting a tourist's choice of a hotel. The data envelopment analysis (DEA) approach is used to compute cost efficiency scores of 61 ITHs in Taiwan during 1998-2007. The number of Asian, North American, Japanese, and local tourists has significantly positive effects on cost efficiency, but the number of overseas Chinese has a negative effect on cost efficiency. The number of tourists of other nationalities has no influence on cost efficiency. Generally, most tourists in Taiwan prefer a larger, older, and closer-to-airport hotel. This study also finds that the chain system, the number of scenic spots surrounding hotels, and the ratio of individual tourists all significantly improve the cost efficiency of ITHs in Taiwan.

Keywords: tourist preferences, nationality sources, cost efficiency, scenic spots, international tourist hotel

(ProQuest: ... denotes formulae omitted.)

1. Introduction

The demand for recreational traveling has increased quickly as local people's income as well as the number of foreign visitors increase all over the world. According to the prediction of World Tourism Organization (UNWTO), the average annual growth rate of tourists from 1995 to 2020 is 6.5% in East Asia, which is the second highest growth rate in the world. The Asia-Pacific market is forecasted to grow from 195 million person-visits in 2010 to 397 million in 2020. The tourism industry not only brings in huge foreign exchange income, but also provides job opportunities in the tourism sector as well as many other industries. According to the World Travel & Tourism Council (WTTC), global tourism expenditures will increase from USD 4.21 trillion to USD 8.61 trillion. Moreover, the total contribution of travel and tourism to global employment, including jobs indirectly supported by the industry, is forecast to rise by 2.3% per annum from 258,592,000 jobs (8.8% of total employment) in 2011 to 323,826,000 jobs (9.7% of total employment) by 2021.

Taiwan's global travel and tourism competitiveness ranking moved up to 43rd in 2009 from 52nd in 2008, according to the latest survey report released by the World Economic Forum (WEF). The WEF-drawn Global Competitiveness Rankings are based on the Travel and Tourism Competitiveness Index (TTCI) and covers 133 economies around the world. Taiwan placed ninth in the TTCI's Asia-Pacific rankings, trailing behind Australia, Singapore, Hong Kong, New Zealand, Japan, South Korea, Malaysia, and Thailand, but placed one notch ahead of China. Taiwan's higher TTCI global ranking in 2009 could be attributed to its increased number of hotel rooms and car rentals as well as a surge in its creative industries' exports. However, despite an improved ranking in 2009, Taiwan fell far short of the 30th place it held in 2007 when the WEF released TTCI rankings for the first time. Taiwan's major competitors include China, which moved up in the 2009 rankings to 47th from 62nd in 2008, and South Korea, which remained in the 31st spot.

In Taiwan the number of visitor arrivals increased by about 2.74 million from 2001 to 2010. The grand total of foreign exchange in Taiwan's tourism industry has grown from USD 3.991 billion in 2001 to USD 6.816 billion in 2009. As the same time, the demand for accommodations in Taiwan has also risen quickly. The number of ITHs rose from 44 hotels in 1985 to 70 hotels in 2011. As the hotel is one of the most important industries in Taiwan, it is worth paying more attention to the evaluation of hotel operation efficiency, which intensifies competition in hospitality industries. Facing increasingly fierce competition, how to enhance productivity and use resources more effectively are now critical issues for hoteliers.

The number of foreign visitors to Taiwan has also been increasing continuously. According to statistics of the Taiwan Tourism Bureau (TTB), the number of visitor arrivals hit 5,567,277 in 2010, or 26. …

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