Location and regionalization patterns of hotel chains: evidence from China

Abstract

Hotel chains shape the industry’s development and competition by locating multiple business units in multiple regions. However, how chain hotels are located and regionalized is severely under-researched. A better understanding of hotel chains’ location and regionalization patterns is key to the studies of the hotel industry, which has been increasingly dominated by chains. Six chains from the emerging economy hotel segment in China were selected, and their location patterns from 2004–2019 were explored through the hotspot detection method. Subsequently, a heuristic method for geographic regionalization based on machine learning was applied to explore the spatial-temporal heterogeneity in the six chains’ dominant markets. The results showed that (1) hotel chains tended to form different spatial distribution patterns, although they adopted the same location strategy; (2) each chain, regardless of size, had one or more dominant market(s); and (3) most chains’ location patterns remained relatively stable during the study period. Our exploratory study contributes to the literature by illustrating hotel chains’ location patterns and their evolution, alongside the development and evolution of their dominant-market regions. It also offers practical contributions by recommending that chain operators develop their location patterns based on their resources and capabilities and try to foster dominant market(s) in which they are absolute leaders.