Innovative value-based price assessment in data-rich environments: Leveraging online review analytics through data envelopment analysis to empower managers and entrepreneurs

Boccali, F., Mariani, M. M. ORCID: https://orcid.org/0000-0002-7916-2576, Visani, F. and Mora-Cruz, A. (2022) Innovative value-based price assessment in data-rich environments: Leveraging online review analytics through data envelopment analysis to empower managers and entrepreneurs. Technological Forecasting and Social Change, 182. 121807. ISSN 0040-1625 doi: 10.1016/j.techfore.2022.121807

Abstract/Summary

This work introduces, develops, and empirically applies an innovative approach aimed at assessing selling prices based on the value perceived by the customers, as measured by electronic word-of-mouth (eWOM) in the guise of online reviews. To achieve this aim, it applies a constant return to scale Data Envelopment Analysis (DEA) approach where the price is the input, and the value attributes are the outputs measured through eWOM in the form of online reviews. We empirically apply the model to the hotel sector by considering both the prices and the service attributes (i.e., staff, location, cleanliness, comfort, facilities and free wi-fi) of 364 hotels based in two leading Italian tourism destinations: Milan and Rome. Our findings suggest that online review analytics can be suitably embedded into analytical models to assess prices. The index developed innovatively supports value-based pricing by means of online review analytics and it is easy-to-perform, and parsimonious as it is based on widely available information on the Internet.

Item Type	Article
URI	https://reading-clone.eprints-hosting.org/id/eprint/105852
Item Type	Article
Refereed	Yes
Divisions	Henley Business School > Leadership, Organisations, Behaviour and Reputation
Publisher	Elsevier
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