Microsoft Word 2007 ichrie conference Proceedings Final-Final 06-06-07. doc

MANAGERIAL IMPLICATIONS 
The effects of traveler reviews on consumers’ perception of a hotel product and on their judgmental 
confidence also provide interesting managerial implications. For consumers who hold original positive belief about 
the hotel, after reading non-diagnostic traveler reviews, even though they will still stick to their original disposition 
in making purchase decisions, their judgmental confidence decreases. For consumers who have a tentative belief of 
not booking, traveler reviews only serves to reinforce such decisions, and their judgmental confidence associated 
with this decision is boosted by extra information supplied by the traveler reviews. The implications for the lodging 
industry are that bad “word-of-mouse” has a double-whammy effect on already discouraged consumers and weakens 
the judgmental confidence of the consumers who plan to purchase. Similarly, for consumers who haven’t made up 
their mind, facing non-diagnostic traveler reviews, they will “filter” through the reviews and assign more weight to 
negative information. With the extra information supplied by traveler reviews, which is perceived as overall 
negative, the undecided consumers may reach their threshold of judgmental confidence --- confidence of not 
booking. 
In summary, our results suggest that traveler reviews can be a powerful form of “word of mouth”, 
especially so when it is negative. Given the easy access to such information, the impact of traveler reviews on 
consumer purchase decisions can not be ignored.