From service engagement to product purchase : cross-buying behavior in hospitality contexts

Purpose: The purpose of this paper is to explore the transformation from service engagement through hotel consumption behavior to subsequent product purchases and identify marketing strategies to facilitate this transformation. Design/methodology/approach: Using a 1.5-year data set of transactional data from a typical hotel firm, the authors examined 4,999 valid purchase events via ordinary least squares regression to test the hypotheses proposed. Findings: Contrary to studies indicating that heavy hospitality users are resistant to external change, the authors found that hotel service engagement (in terms of recency, frequency and monetary value) significantly informed subsequent product purchases. Effects varied based on customized solutions and product purchase channel. Practical implications: Product managers in hospitality should target customers who have recently patronized hotels as well as hotel customers with high monetary value and frequency. Managers can adopt distinct marketing strategies (e.g. customized solutions and purchase channels) to sell hotel customers more products. Originality/value: Prior studies have framed the cross-selling of hospitality services as a vital revenue management strategy from hotel firms’ or frontline employees’ perspectives. However, to the best of the authors’ knowledge, this is the first study to test how hotels cross-sell tangible products by targeting customers engaging in hotel consumption and by examining two major product marketing strategies that may facilitate or hinder this cross-selling process.