A Study on Dynamic Pricing of Hotels on Consumers’ Purchase Intention Based on Prospect Theory and Regret Theory

Faculty of International Tourism and management, City University of Macau, Macau, 999078, China

^* Corresponding author: T24091115342@cityu.edu.mo

Abstract

In the context of intense hotel competition and complex consumer behavior, the traditional static pricing model has been difficult to provide a more efficient solution for hotel pricing. In this paper, by combining prospect theory and regret theory, the dynamic pricing strategy of hotels is studied in terms of consumers’ psychology, and consumer behavior. Through the survey and analysis, older consumers are more sensitive to gains and losses than younger consumers and are also more likely to experience regret. Occupation also has an impact on consumers’ willingness to buy, with civil servants and entrepreneurs being more sensitive to gains and losses compared to other occupations. Differences in income levels are also an important factor influencing consumers. The analysis shows that the high-income group exhibits a stronger focus on dynamic price changes compared to the low-income group, a difference that also suggests variability in consumption habits due to different incomes.