SELECTING SUSTAINABLE LUXURY: AN EMPIRICAL STUDY OF CUSTOMER'S CHOICE OF HOTELS IN DELHI
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International Journal of Civil Engineering and Technology (IJCIET)
Volume 10, Issue 01, January 2019, pp. 1176–1185, Article ID: IJCIET_10_01_108
Available online at http://www.iaeme.com/ijciet/issues.asp?JType=IJCIET&VType=10&IType=1
ISSN Print: 0976-6308 and ISSN Online: 0976-6316
©IAEME Publication Scopus Indexed
SELECTING SUSTAINABLE LUXURY: AN
EMPIRICAL STUDY OF CUSTOMER’S CHOICE
OF HOTELS IN DELHI
Shweta Mathur
PhD Scholar, Amity School of Hospitality, Amity University Uttar Pradesh, India
Dr Kavita Khanna
Assistant Pofessor, Amity School of Hospitality, Amity University Uttar Pradesh, India
Dr Sanjeev Kumar Saxena
AGM, HRD, Jaypee Palace Hotel and Convention Center, India
ABSTRACT
The paradigm shift of hospitality businesses to Sustainable Development is
spurring hotels to be scrupulous in their operations, products, services, and activities
that impinge our planet, its people, and profits. The study focuses on assessing the
influence of Sustainable approach of 15 Luxury chain hotels in Delhi on customer’s
selection of a hotel as a contribution to holistic sustainability. This study would help
reveal dominant factors that can help identify sustainable choices that will lead to the
development of Sustainable Business Model. The Analysis reveals two vital facts that
can help bring about a radical change in hotel business model in meeting
sustainability goals. First, the study shows that customers are primarily not concerned
with the sustainable impact on their choices. Second, the study identifies the
parameters that can impact sustainability positively through the development of a
Business model.
Key words: Business Model, Customer’s Selection, Luxury Chain hotels, Delhi,
Sustainable attributes and practices, Sustainability
Cite this Article: Shweta Mathur, Dr Kavita Khanna and Dr Sanjeev Kumar Saxena,
Selecting Sustainable Luxury: An Empirical Study of Customer’s Choice of Hotels in
Delhi, International Journal of Civil Engineering and Technology (IJCIET) 10(1),
2019, pp. 1176–1185.
http://www.iaeme.com/IJCIET/issues.asp?JType=IJCIET&VType=10&IType=1
1. INTRODUCTION
Sustainable development is the new driver of innovation in today’s competitive landscape. As
travel and tourism industry is witnessing a phenomenal growth in terms of tourism receipts
globally by around 200% and by 900% (from $ 2,582 Million to $ 23,111.00 Million) in India
alone, in the past two decades[1]. Since hotel and tourism relies on resources from the society
http://www.iaeme.com/IJCIET/index.asp 1176 editor@iaeme.comShweta Mathur, Dr Kavita Khanna and Dr Sanjeev Kumar Saxena
(talent, employment, culture, infrastructure etc).It’s growth directly influences the
environmental and economical ecosystem of the society. While a growth in Hotel and
Tourism generally leads to a long and short term economical gains to the society however
studies have suggested that this growth if not given the right direction can also lead
environmental and societal woes. In the long term adverse environmental impacts coupled
with increasing competition the market can lead to permanent damage that can bring the
growth to a screeching halt or lead to negative growth
Currently, both tourism service providers and consumers portray a common behaviour of
environmental advocacy and protectionism. In recent years there has been a lot of research
done on the toll the commercial tourism sector takes on our environment and society. The
hospitality industry which is the largest constituent of the former is one of the major
influencers.
The main goal of the hotel industry is to cater to the needs of the guest and provide a
comfortable stay. Typically business and profit margins are related to how well they are able
to achieve this goal. This leads to less focus on the sustainability and environmental aspect of
the hotel.
In fact there are stiff challenges to overcome in order to implement sustainable features
with a guarantee that it will be successful, education is an important part of the process, and
without it, the program will not work. There are a number of misconceptions, and educating
managers, staff, and guests on the importance of sustainable development can make for a
more successful program. Guests who are concerned about the environment also have to be
educated on which hotels are truly taking steps to become more sustainable and which one is
just green-washing. The industry can be more successful when it targets not only the eco-
traveller but also the average hotel guest, it can do this by providing all the luxuries that they
expect but also be environmentally conscious in doing so.
To target sensitized travelers leading hotel brands have launched ‘Planet 21 in Action’ of
Accor, ‘Green Engage program’ of Intercontinental Hotel Group (IHG), ‘Sustain responsible
operations’ of Marriotts, LightStay , a digital platform by Hilton hotels amongst many others.
Though, it is needed to intrinsically incorporate sustainability management and performance
monitoring in a true sense in lines of the 17Sustainable Development Goals (SDGs) to end
poverty, protect the planet and ensure prosperity for all as part of a new sustainable
development agenda[2].Investments in latest SMART technologies such as HVAC systems,
energy saving devices and regular maintenance schedules for improvements in indoor air
quality and acoustic and thermal comfort by hotels resulted in minimizing guest complaints
and enhancing the guest's experience during their stay.
This paper is therefore centred on the objective to measure the impact of sustainable
attributes and practices on customer’s selection of hotels in Delhi and to present a sustainable
hospitality business model for Luxury hotels. For the purpose of building a radical
understanding of the research area, an exhaustive number of publications were reviewed by
the researcher revolving around the keywords of the research topic as below:
1.1. Concept of Sustainable Development
The scope of this paper revolves around the term ‘Sustainable Development’[3] in its three
dimensional construct of Triple Bottom Line (TBL) integrating the environmental, social and
economic sustainability for future generations[4-7], using Triple bottom line as a measure for
customers awareness in hotel selection. The concept of ‘Sustainability’ is central to the
ideology of hospitality industry[8], such as IHCL[9] and ITC hotels[10] have profoundly
integrated environmental and social sustainability of TBL in their corporate philosophy in the
http://www.iaeme.com/IJCIET/index.asp 1177 editor@iaeme.comSelecting Sustainable Luxury: An Empirical Study of Customer’s Choice of Hotels in Delhi
form of, EARTH (Environment Awareness & Renewal at Taj Hotels)[11] and ‘Well-being
Out of Waste’ (WOW) respectively.[12]
1.3. Attributes of Hotel Selection
Buying behaviour of guests of luxury hotels is associated on the attributes of security,
dependability, service quality, convenience, and reputation [13-18]. International hotel brands
like Starwood, Hyatt and Fairmont have exemplified awards and recognition as significant
selection factors [19].
The hotel guests are environmentally sensitized and opt for sustainability conscious
hotels, though are reluctant to pay an additional price to support their services [20- 23]. Millar
& Baloglu [24] opposed the previous researches revealing that the guests are willing to bear
the premium pricing. A cognition rating of the travellers showed minimal awareness of
environmental concepts [25]. It is also noted that the hotel rating websites such as Trip
Advisor, Trivago, Expedia and others do not include sustainability practices while rating the
hotels but this has been contradicted by showing the proclivity of travelers towards eco-
conservation [26].
It is found that the subject of hotel selection criteria has been overemphasized by the
erstwhile scholars and investigators, albeit they have not devoted much of their attention to
consider studying the importance of sustainable attributes and practices and its consequent
implication on hotel selection.
1.4. Integration of Sustainable Development in Hospitality Business Model
A scientific Review of Literature on successful Business Models in Hospitality Industry
summarized the key factors to gain the competitive advantage and improve enterprise
performance [27,28,29]. These are Customer Relationship Management, Internal Marketing,
Innovation, technology, Value Proposition and Empowered employees. However, we
proposed a reinterpretation of the sustainable hospitality business model based on our
study.
Thus, on the basis of gaps identified through the literature review, this study provides the
following hypothesis:
H1: There is a significant impact of sustainable attributes and practices on customer’s
selection of a Hotel
H2: There can be a Sustainable Hospitality Business Model for Luxury hotels.
2. METHODOLOGY
The scope of this paper includes assessment of the guest’s selection of a hotel for their stay
based on identification and estimation of the sustainable attributes and practices respectively
adopted by luxury chain hotels in Delhi, including Value propositions under three dimensions
of sustainability. Delhi is selected for this study, as the city is reported the most visited city in
India, and has ranked 21st in the world, according to the ‘Top 100 Cities Destination
Rankings’ report released by Euro monitor International – the global business intelligence and
market analysis company. It is speculated to enter top ten by 2025 when it is expected to
attract 18.8 million Foreign Tourist arrivals. Thus, the findings of this study would be the
representative of India[30].
2.1. Sampling
A study reported 90 percent of foreign tourists and 41 percent of domestic tourists arriving in
Delhi opted to stay in Luxury hotels in Delhi [31]. Thus,15 luxury chain hotels were
http://www.iaeme.com/IJCIET/index.asp 1178 editor@iaeme.comShweta Mathur, Dr Kavita Khanna and Dr Sanjeev Kumar Saxena
identified for the study, out of a list of 17 Luxury (five star and five star deluxe) hotels
(eliminating two Independent hotels) approved by Ministry of Tourism, Govt. of India
website in June 2016 (Table1).
Table 1 List of Luxury Chain Hotels in Delhi
S.No Hotel Group Hotel Name
1. Jaypee Group Jaypee Siddharth
2. The Leela Group The Leela Palace New Delhi
3. Piccadily hotels Pvt. Ltd Piccadily Hotel
4. Accor Group Novotel Aerocity New Delhi
5. Eros Group Shangri-La Eros New Delhi
6. Starwood Le Meridien New Delhi
7. Bharat Hotels Ltd The Lalit New Delhi
8. ITC ITC Maurya
9. IHG Crown Plaza, Mayur Vihar
10. IHCL The Taj Palace Hotel
11. Apeejay Surendra group The Park New Delhi
12. Carlson Rezidor Radisson Blu, Dwarka
13. Marriott Intl. JW Marriott, Aerocity
14. Hyatt Hyatt Regency New Delhi
15. ITDC The Ashok
Source: Ministry of Tourism, Government of India, 2016
Table 2 Demographic Variables of the Respondents
Factors Options No. of Percentage (%)
Respondents
Gender Male 130 35.6
Female 235 64.4
Age < 20 years 29 7.9
21-30 years 132 36.2
31-40 years 159 43.6
41-50 years 27 7.4
51-60 years 18 4.9
>61 years - -
Qualification Senior secondary 14 3.8
Higher 0.8
secondary 3 2.2
Diploma 36.7
Graduate 8 51.0
Post Graduate 134 5.0
PhD. 186
20
Purpose of Stay Business 124 34.0
Leisure 156 42.7
Events 30 8.2
Conferences 48 13.2
Others 7 1.9
Length of stay 1-3 days 267 73.2
4-6 days 76 20.8
7-9 days 18 4.9
>10 days 4 1.1
http://www.iaeme.com/IJCIET/index.asp 1179 editor@iaeme.comSelecting Sustainable Luxury: An Empirical Study of Customer’s Choice of Hotels in Delhi
The sampling population represented a mix of guests who were staying in sampled hotels
or had stayed with them. A survey methodology was chosen because it was deemed to be the
most efficient way of reaching a large number of respondents. This study used a self-
administered, close-ended questionnaire with ordered choices of 16 selection criteria that
include services, Marketing and Promotion and Sustainable attributes and practices to mark
the most preferred selection criteria. An online questionnaire was prepared and circulated
amongst travellers who used the communities on Facebook and Whatsapp. The questionnaires
were also emailed to a set of contacts at random. Out of 372 distributed questionnaires, usable
questionnaires were returned by 365 guests.
2.2. Data Analysis
Majority of the questions relating to the research objectives were made on a bipolar Likert
scale of five pre coded items, as this is adapted from previous researches to test the
comparability. The statistical tools used in this study were percentages, Spearman's rank order
correlation and ordinal regression to focus on the strength of the relationship between
selection variables and to ascertain causal relationship and trend between all 16 selection
variables and one dependent variable of sustainable attributes and practices. The analysis of
the survey results combined with the statistical applications (IBM SPSS 20.0) allowed the
researcher to draw conclusions regarding the objectives of the study is produced.
2.3. Reliability Analysis
The data collected through the survey was tested for reliability using Cronbach’s alpha, that
shows internal consistency reliability of .958 for the composite scores of 16 items used that
denotes a reliable variance.
3. RESULTS
Table 3 Spearman’s Rank Correlation Matrix on the influence of sustainable attributes and practices
on customer’s selection of a hotel
Spearman’s Correlations
1 2 3 4 5 6 7 8 9 10 1 12 13 14 15 16
1
1 Brand
2 Reputation .48**
3 Social media .15** .23*
*
Reviews.
Eg.TripAdvisor
ratings
4 Pricing -.1 .10* .08
5 Recommendations .19** .33* .21** .16
* **
from others
6 Previous .07 .15* .07 - .1
*
Experience .04
7 Convenience or - - - .12 .1 -
Location .16** .13* .21** *
.08
8 Reward Programs .12* .28* .20** .19 .37 .1 -.04
* ** **
9 Package Deal .13* .27* .32** .14 .18 .06 .07 .58
* ** ** **
* * **
1 Environmentally .13 .35 .26 - .17 .14 . .52 .46
* ** ** ** **
0 and Socially .05
Friendly
1 Hotels should be .18** .18* .07 .24 .28 .07 -.13* .09 - -
* ** **
1 undertaking .06 .0
sustainability 3
initiatives
http://www.iaeme.com/IJCIET/index.asp 1180 editor@iaeme.comShweta Mathur, Dr Kavita Khanna and Dr Sanjeev Kumar Saxena
1 Sustainability .18** .33* .14** - .21 .09 .16** .43 .40 .3 .0
* ** ** **
2 practices of any .05 6* 8
*
hotel enhance your
stay in the hotel
1 sustainability .11* .25* .12* .07 .1 .02 -.09 .32 .41 .3 . .21*
* ** **
3 practices do not 4* *
*
override your
considerations of
price
1 sustainability .07 .13* -.03 .19 .08 - .19** .26 .17 .2 .0 .30* .51
** ** **
4 practices do not .02 3* 5 * **
*
override your
consideration of
convenience
1 consider .32** .26* .31** - .16 .17 -.06 .35 .39 .4 .1 .39* .31 .23
* ** ** ** **
5 sustainability .02 1* 2* * ** **
*
initiatives of a hotel
while booking
1 consider a hotel .31** .35* .29** - .20 .08 -.08 .52 .50 .5 .1 .46* .36 .36 .67
* ** ** **
6 based on the .02 4* 1* * ** ** **
*
certifications
NOTE: N=365, ** .p< 0.01, *.p< 0.05
Table 4 Ordinal Regression Model Fitting Information
Model -2 Log Chi- Df Sig.
Likelihoo Square
d
Interce 926.901
pt
Only
Final 707.137 219.764 51 .000
Link function: Logit.
Table 5 Ordinal Regression- Goodness-of-Fit
Chi-Square Df Sig.
Pearson 2642.123 425 .000
Deviance 703.666 425 .000
Link function: Logit.
Figure 1 Column Chart of Crosstab of Customer’s selection criteria and Purpose of Visit
http://www.iaeme.com/IJCIET/index.asp 1181 editor@iaeme.comSelecting Sustainable Luxury: An Empirical Study of Customer’s Choice of Hotels in Delhi
Figure 2 Sustainability Business Model For Luxury Hotels
Factors Influencing Dimensions of Sustainability (Triple Bottom Line)
Hospitality Business Environmental Social Economic
Model
Value Proposition *Energy Conservation *Empowered *Increased Revenue
*Water Conservation employees *Cost Reduction
*Waste Management *Community welfare *Competitive
& Development advantage
*Social welfare
Value Creation *Certifications *Internal Marketing *Customer
*Green Teams *Talent Management Relationship
*Innovation *Skill Development Management
*Awards & *Donations *Technological
Recognitions Development
*Innovation
*Leadership
Value Capture *Engagement of Stakeholders
*Extra Value through collaboration
4. DISCUSSION OF FINDINGS
The non-parametric correlation test was applied as the data was collected through random
sampling which was representative of the population of guests of luxury chain hotels in Delhi.
The Correlation Matrix suggest that the p-value is statistically significant. However, there
exist a weak relationship between 16 selection variables and sustainable attributes and
practices. There are certain selection variables are negatively correlated to sustainable
attributes and practices namely, Pricing, Brand, Previous experience, Convenience or
location, reputation, social media reviews, Sustainability practices of any hotel enhance your
stay in the hotel, sustainability practices do not override your considerations of price. In order
to predict the behaviour of the dependent variable ‘impact of sustainable attributes practices’
on hotel selection by customers, an ordinal regression test was applied. The goodness of fit
Model shows statistically significant results 0.05. Thus our model fits the data and the factors
are able to fairly predict the customer’s preference of selection criteria. Pseudo-R square
statistics explains 49.0% of the variance explained by the independent variable. Therefore,
there is no significant relationship between the sustainable attributes and practices and
customer’s selection of a hotel for their stay in luxury chain hotels of Delhi. Also (Fig.1)
http://www.iaeme.com/IJCIET/index.asp 1182 editor@iaeme.comShweta Mathur, Dr Kavita Khanna and Dr Sanjeev Kumar Saxena
indicates the selection criteria is mostly considered by the customers staying for the purpose
of leisure in hotels followed by business.
The Sustainable Hospitality Business model (Fig 2) is adapted from the previous studies.
It suggest that Hospitality chains must orient their services and practices around three
dimensions of Environmental, Social and Economic sustainability that conforms with the
factors of Value Proposition, Value creation and Value capture in the Business Model.
5. CONCLUSIONS
This study while suggesting the Sustainable Hospitality Business model brings out the
paradoxical results that on one hand we see the Luxury segment of hotel guests believe in
sustainability issues and are interested to be a part of this sustainable movement but on the
other hand, it does not get reflected in their engagement with sustainable efforts while making
a choice of a hotel for their stay. The results clearly indicate poor influence of sustainable
attributes and practices on hotel’s selection by the guests of the sampled chain hotels. The
influence of Package deal shows a positive influence on their choice of hotel. However,
involvement in socially responsible activities of these hotels garners the least influence on the
guests. Hence the study indicates the need for a mainstream behaviour change of hotel guests.
Mainstreaming of sustainability will be achieved through hotel companies fully incorporating
these issues into their business models as developed in this research that minimize the
negative impacts and preferably have positive impacts - on the global or local environment,
community, society or economy.
In addition, there is also a clear benefit to the business in the form of reputational,
commercial and investment benefits as well as benefits for the community and the
environment. The hotels may use social media and other opportunities to educate their guest’s
on their sustainability driven business ideology as well as their products and services to build
brand awareness and increase revenues. This paper suggests ‘Cause-based marketing’ as an
effective means of presenting sustainable actions and social passion with the target audience.
The results of this paper are limited to the luxury chain hotels of Delhi, hence it may not be
generalized with other segments of hospitality trade, though it would be interesting to draw a
comparison of the findings across other hotel categories and across other related businesses.
The research findings reveal a high degree of concern for sustainability that is not integrated
into customer’s selection of hotels based on the sustainable actions of hotels. The research
results can be used by hotel managers in order to improve and adopt sustainable strategy in
their marketing policy to create a pull effect using sustainable attributes as their USP and
differentiating factor for attaining leadership through responsible Business.
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