A Study on the Determinants of Expenditure in Luxury Hotels: Application of the Tobit Model

The purpose of this study is to estimate the factors influencing the expenditure decisions of guests who have stayed at luxury hotels, focusing on hotel selection attributes, demographic characteristics, and usage behaviors.Specifically, the Tobit model, an econometric method, was employed to identify the determinants of average expenditure per stay.The findings aim to provide foundational data to support the development of segmented services and targeted marketing strategies within the luxury hotel industry.The survey was conducted online using a judgmental sampling method targeting adults aged 20 and above residing in Seoul and the metropolitan area who had stayed at one of six luxury hotels in South Korea (L Hotel, S Hotel, I Hotel, C Hotel, W Hotel, and H Hotel).A total of 394 valid responses were analyzed using SPSS 19.0 and LIMDEP 8.0.The analysis revealed the following: First, Income had a statistically significant positive effect on expenditure at the 1% level, indicating that individuals with a monthly income of 3 to 5 million KRW were more likely to spend more during their stay.Second, Travel purposes such as celebrating anniversaries and engaging in social activities with family or acquaintances also had a positive effect at the 1% significance level.Third, among hotel selection attributes, the 'safety and service' factor had a positive influence at the 5% level, while the 'convenience and leisure' factor was significant at the 10% level.This study is academically meaningful in that it empirically identifies expenditure-related behavior of luxury hotel guests during the unique conditions of the COVID-19 pandemic.The findings are expected to offer practical implications for marketing strategies, demand forecasting, and revenue optimization in the luxury hotel sector.