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Research in Hospitality Management Volume 7, 2017 - Issue 1
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Original Articles

Price, exclusivity and luxury: Exploring London’s luxury hotels

Andy HeyesStenden Hotel Management School, Leeuwarden, The NetherlandsCorrespondence[email protected]
&
Conrad LashleyStenden Hotel Management School, Leeuwarden, The Netherlands
Pages 17-26 | Published online: 01 Oct 2017

Abstract

Luxury is commonly said to be in the eye of the beholder. It typically relies upon the comparison with the given norms, and reflects the consumption patterns of society's economic elite. Research into the luxury retail industries have grown in popularity over the past two to three decades, with little research being conducted into luxury hotels and variations between them. It is traditionally suggested that three features work with one another; as price increases, levels of exclusivity and luxury also increase. Luxury hotels are said to be built on the same premises. The quality of the tangible and intangible offer is greater than the norm. The aim of this investigation was to critically explore the relationships between the constructs of luxury, price and exclusivity within hotels. Three hotels in the city of London were selected to take part in this small-scale, multi-method investigation, with specific attention being dedicated to each of the three hotels’ top suites. All hotels and rooms were defined as luxurious, and service levels were similar, yet each of the three hotels charged £5 000, £15 000 and £22 000 per night for their top suite. The three hotel suites used in this investigation suggested a negative correlation between the relationship of price and luxury, and a positive relationship between price and exclusivity. These findings suggest that a hotel room that is more expensive does not necessarily mean it is correspondingly more luxurious. Further research is recommended to examine the proposition of the concept called conspicuous pricing (similar to that of prestige pricing) used as a method chosen by hotels within the pricing strategies, as well the possibility of conducting similar research within different geographical locations to compare and contrast the three constructs (luxury, price and exclusivity) under different cultural environments.

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