African Journal of Business Management Vol. 6(2), pp. 493-500,18 January, 2012 Available online at http://www.academicjournals.org/AJBM DOI: 10.5897/AJBM11.

1085 ISSN 1993-8233 2012 Academic Journals

Full Length Research Paper

Comparative study on different viewpoints of luxury brand equity based on the luxury resort hotel in Taiwan and Macao
Jui-Ying Hung1, Feng-Li Lin2* and Wen- Goang Yang3
Department of Senior Citizen Service Management, Chao-Yang University of Technology, No. 168, Jifeng E. Rd., Wufeng District, Taichung, 41349 Taiwan, R. O. C. 2 Department of Accounting, Chaoyang University of Technology, Taichung, Taiwan. NO.168, Jifong E. Rd., Wufong Township, Taichung, 41349, Taiwan, R. O. C. 3 Department of Leisure Service Management and Department of Marketing and Logistics Management, Chao-Yang University of Technology, No. 168, Jifeng E. Rd., Wufeng District, Taichung, 41349 Taiwan, R. O. C.
Accepted 11 October, 2011
1

Adopting the concept of luxury experience brand equity and customer orientation in the luxury resort hotel industry is very important. Furthermore, the study is based on the first gap of SERVQUAL model which points out that the first of the five major lags in the service industry is the expectation lag between the consumers and the industry managers. The study focuses on luxury resort hotels industry located in Taiwan and Macao and analyzes the viewpoints, awareness of the consumers, consumers engaged in the industry, and civil service and academia. The research result shows that consumers and managers in Taiwan have different interests when it comes to luxury brand equity, while the situation in Macao is quite the opposite. One reason is that hotel owners in Macao can cope with the environmental changes and psychological changes. The government, along with academic institutions, tries to recognize potential problems early on. Some of these may include pattern change in consumption and changes in consumption intention. Key words: Luxury resort hotel industry, brand equity, experience. INTRODUCTION The hotel and tourism industry takes pride in providing customer-oriented services. In recent years, the service industry has associated itself with brand equity and the brand theory, which has gradually become a trend for scholarly discussion. Since Cobb-Walgren et al. (1995) applied Aakers (1991) brand equity evaluation model to discuss about the hotel industry, it has widely aroused scholars research interests and attention on brand equity. Although studies indicate that perceived quality is not an important indicator for the consumers in evaluating the hotel industry, it is still an important factor in breaking through the rigid mindset adopted by the domestic and overseas scholars in conducting brand equity studies. So far, they have only discussed about brands which have provided tangible products since the 1980s (Aaker, 1991; Chen, 1996; Farquhar, 1989; Kamakura and Russell, 1993; Keller, 1993; Trevor, 1998). There are only a few literatures and empirical studies related to brand equity at home and abroad to date (Bery, 2000; Cobb-Walgren et al., 1995; Keshav, 1999; Lassar et al., 1995; Sharp, 1995), primarily because the data collection and research design are difficult throughout the course of the study process conducted in the service industry. While the current practical field has focused on the construction of brand equity and has attached importance to the industrial

*Corresponding author. E-mail: fenli@cyut.edu.tw. JEL classification: L83, M16.

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era with strategic ideology and the consumers involvement, empirical research seems to have a slight lag with the industrial practice operations. For this reason, this study will explore and construct the brand equity model focusing on luxury experience through logical, innovative and integrative research design. The industrial development of luxury image emphasizes that what consumers own or value is not the functional value of tangible products, but is a kind of self extension value brought by the consumption process and ownership (Michael and Neil, 2003; Nueno and Quelch, 1998; Vigneron and Johnson, 2004). Service organizations brand equity especially depends on consumers brand evaluations (Besharat, 2010). The luxury consumption does not even have the so-called concept of ownership or proprietorship, but only a kind of experience, memory and feeling (Danziger, 2007; Kerr, 2005; Michael et al., 2003). This conceptual demand happens to coincide with the characteristics of tourism; service and experience are key factors influencing the industrial development. Therefore, if we can discuss about luxury resort hotels from the industrial perspective (industrial characteristics and management direction) and the consumers perspective (consumers awareness and brand equity), and analyze whether there is an identification lag between each other, thus, providing relevant research results or offer business strategies for future enhancement and improvement, to serve as a reference for the industrial practitioners and researchers, the result will be an invaluable and significant reference for future development of the operational process in the entire industrial field. Research purpose It is the common awareness and consensus of industrial practitioners to emphasize the business model of customer orientation (Dunlap et al., 1988; Saxe and Weitz, 1982), but there has always been a lag between the product or service appeal designed by the practitioners from the perspective of the consumer and the consumers identification from actual consumption (Parasuraman et al., 1988). This is the key factor in influencing the consumers evaluation of the enterprises. Even though the purchase satisfaction survey done by consumers is often used in the practical field to examine the performance of the enterprise service or taken as the reference for the future improvement, this action is only a singular remedy. By applying academic theory and model design, and conducting continuous interviews about the development direction and characteristics with the industrial, public servants and academic experts, and having discussion about the consumers awareness based from actual consumption, all these can form a circular and repeatable identification feedback process to shorten the lags. It is

critical use for the dependence between practical field and academic research, and is also the main research goal of this study. LITERATURE REVIEW Service brand equity Brand equity is a dynamic way of thinking. The aspects and angles of discussion it covers also keep the concept broad. Discussing and measuring the brand equity with only a general standard cannot fully acquire the brand equitys importance, and it ignores the basic existing values and principles of brand equity that focuses on development rather than maintenance. Through the meaning, characteristics and promise of the brand, it can be known that brand is a kind of text or figure that is unique and identifiable. This is used to convey the manufacturers maintenance of the source, quality, credit and equities of their products, and allow the consumers to easily distinguish them from the other similar competitive products or service. Since formation of the brand concept is to effectively make comparisons between all kinds of tangible products through the identification of their attributions, competitiveness or performance, therefore, enterprises need to focus on the marketing strategy, the advertisement or the image of the brand spokesman, in which the brand image of the enterprise can be improved drastically and positively. In addition, this kind of brand relationship has also been a research trend in brand equity study since the year 1990 and has since become a consensus research model. Although, for the service-based brand, due to its variability and intangibility and its big gap between brands in the same industry, academic literature of brand characteristics related to this industry is still in its initial development stages. As to the subjects related to brand equity, many scholars have proposed relevant definitions and evaluation perspectives based on different viewpoints since 1980. Actually, these literatures related to brand equity are mostly for the brand equity identification of the consumers received from the enterprises advertising media, marketing programs, spokesman and publicity, but not from actual consumption. In the past, the empirical subjects are mainly the consumption of tangible products, and the consumers final goal to own the products. Thus, for the consumers, the non-functional brand equity is an additional value but not a key factor in influencing his evaluation of the brand equity. In academia, it was only after Aaker (1991) developed the systematic and overall brand equity dimensions that the study of brand equity was promoted and emphasized. However, the literature on brand equity in the service industry is very sparse (Berry, 2000; Padgett and Allen, 1997; Sharp, 1995), especially for literature dealing

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Table 1. Induction of brand equity and service brand equity.

Parameter Developed decade Key points

Brand equity Early 1980s The brands providing tangible products Yes

Service brand equity Late 1990s The brands providing intangible service or mainly focusing on experience. No. Relies on feelings felt during the service process, as well as the feeling and lasting memories produced after consumption. Still in its initial development stage, and relative studies are all based on the basic model of brand equity. There is still no common concept model available.

Ownership

Development

Has already formed the consensus brand-equity schema (Aaker, 1991; Keller, 1993)

specifically with the hospitality industry as the main empirical subject (Bailey and Ball, 2006; Cobb-Walgren et al., 1995; Slattery, 2003; Yu, 1999), or studies based on service brand equity that refer to luxury experiences. de Cherbatony et al. (2005, 2006) explored the ways that service brand values are communicated to both staff and customers. Therefore, Chang and Liu (2009) explored consumer preference and purchase intention impacts brand equity. This study aims to develop brand equity through luxury experience. On the other hand, the construction of brand equity or evaluation perspectives is based on service that is mainly considered as intangible service. Therefore, the focus of brand equity is taking the nonfunctional additional value or extensive brand equity as key evaluation points (Table 1). This research will therefore classify the brand equity perspectives with luxury experience. Traditional brand equity perspective (Aaker, 1991; Keller, 1993) is considered as the basic functional value composition factor of the brand equity in the service industry. Previous studies on brand equity measurement can be classified into customer-based brand equity (CBBE), where the value of the brand is determined by customers associations with a product brand and corporate brand equity (CBE), where the value of the brand is determined by stakeholders associations toward a corporate brand. Numerous ways of measuring consumer-based brand equity have been forwarded (French and Smith, 2010; Shamma and Hassan, 2011). Asri (2011) states that brand awareness, brand association and perceived quality directly and indirectly affect brand loyalty in the constructs of customer-based brand equity between the countries. As to the extensive non-functional value, evaluation factors for discussion about the luxury resort hotels brand equity will be further constructed after summarization of the literatures combining the luxury resort hotels industrial characteristics with the concept of experience.

Construction of luxury experience brand equity Ohmae (2006) mentioned in his book The M Society, that luxury and experience are two strongly relevant concepts because luxury is a kind of non-functional value created by surpassing tangible products, and a kind of self realization through which consumers try to surpass or escape from the daily living environment. It is also a kind of transformation produced by consumers self extension or empathy. However, that statement cannot make luxury tangible, it is only after the consumer has experienced the process by themselves, can they transform the relevant memories, atmosphere and feelings into inner awareness to achieve its extensive effect. The experiential economy is a kind of creative industry, a transition economy type formed since the 1980s, after western countries experienced the global economic crisis; it is also a new consumption development trend. The major content of experiential economy is that enterprises can form distinguished and unique market segments through providing good and impressive consumption experience. This ultimate goal happens to coincide with the content of brand equity, and it will greatly contribute to this study in identifying the experience value that can be included in brand equity. As to the relative research of the value created by experience, the three development stages and discussions of Sheth et al. (1991), Holbrook (1994) and Mathwick et al. (2001) are considered. Sheth et al.s (1991) are valued the most and holds the idea that in the process of consumption choice, a concept model of multiple consumption value functions will be formed through different social interaction, exchange and consumption; this will serve as the main basis of discussion. Sheth et al. (1991) have also developed the customer value and marketing choice model which divided the customer value into five categories: function value, social value, emotion value, epistemic value and conditional value. The consumers decision-making process may be influenced by any of the mentioned categories. In other

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Intrinsic value Extrinsic value

Playfulness Consumer return on investment Active value

Aesthetics Service excellence Reactive value

Figure 1. Experience values proposed. Source: Mathwicka et al. (2001).

categories. In other words, besides the products function value, the consumers decision making process is also influenced by internal and external environment, such as emotion, and peer group. Lastly, Mathwick et al. (2001) added that during the consumption experience, consumers can directly access it through product attributes and service performance, or achieve the consumers consumption goal through the interaction process. According to the framework of consumers self-oriented experience value types proposed by Holbrook (1994b), Mathwick et al. (2001) concluded the experience values as following these aspects: playfulness, aesthetic, consumer return on investment (CROI) and service excellence (Figure 1). Mathwick et al. (2001) also applied the experiential value model to the survey of online and catalogue shopping, in which they discovered that experience value can be used effectively to predict the consumer preference, and that common online consumers return on investment can predict the online shopping preference, which significantly influences the consumers purchasing intention in the future. Previous researchers (Blattberg and Deighton, 1996; Hyun, 2009) defined customers equity as the total of the discounted lifetime values summed over all of the firms customers. Customer equity attempts to measure customer relationship value based on not only a customers current profitability, but also the customers long-term profit value. As to the consumers of catalogue shopping, besides the return on investment, artistic value can also effectively predict the catalog purchase preference and their future purchasing intention. Baker (2006) found out that consumers would achieve the feeling of experience value through the following four aspects: participation degree in the market (including the joint participation of the service personnel and other consumers), degree of achieving the goal through market, controllability of goal or demand (including the decisive right produced through a certain way) and sense of belonging (consumers sense of belonging in specific groups or categories). Keeping in mind that Sharp (1995) and Yoo et al. (2000) were the first ones to combine the products with the concept of brand equity (Aaker, 1991; Blackson, 1992; Chen, 1996; Kamakura and Russell, 1993; Keller, 1993; 1998; Park and Srinivasan, 1994) and developed it towards the research direction integrating the professional service and brand equity, in summary, the research takes professional service as its main subject, which focuses on intangible assets owned by enterprises,

including internalized items (such as business operation, enterprise image, technology), as well as the enterprise foundation in the market (such as the customer loyalty, brand/enterprise image, customer awareness, and so on). In general, empirical research objects related to the concept of experience value are mostly from the service industry, emphasizing on the service process design or making consumers have mental extensive identification through brand-building. This idea is similar to the background of the experience-based LBE to be constructed in this study. It also provides important reference for this study in adopting relative perspectives of experience value proposed by Mathwick et al. (2001). This research will use basic extrinsic value and extensive intrinsic value to construct the basis in evaluating luxury resort hotels brand equity (Hung, 2008). Basic extrinsic value This is the basic but necessary value that the consumers get through this brand (including business organization connection, brand awareness, brand loyalty, and brand personality). The brand equity construction of this research object (luxury resort hotels) is to combine the customer-based brand equity (Aaker, 1991; Chen, 1996; Keller, 1993) and the characteristics of the hotel industry, including their main products and service, which are prone to have basic extrinsic value. Extensive intrinsic value After the experience process, compare the consumers awareness of the brand with the expected mental extensive value obtained through the brand, which includes the following: identification of the luxury brand, experience value, uniqueness and other factors. This kind of value may vary with the consumers identification, the brand image built by the practitioners, or brand evaluation obtained through relative media by other reference groups. Thus, when constructing relative evaluation indicators, we cannot use precise perspectives or indexes to fully illustrate, but only taking consumers identification as the main reference.
RESEARCH FRAMEWORK This research mainly aims to study the similarities and differences of awareness of the luxury resort hotels in Taiwan and Macao

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Consumer viewpoint

H1

Expert viewpoint

Luxury brand equity

Figure 2. Conceptual framework.

Table 2. Profile of respondents.

Survey area Taiwan The Lalu (Sun Moon Lake) Hotel Royal Chiao Hsi Fleur De Chine Landis Resort Macao ALTIRA MGM Macao Wynn Macao The VENETIAN Macao

Extending questionnaire number 430 100 185 111 34 440 20 56 58 308

Effective number 426 96 181 115 34 425 20 53 55 297

Effective ratio (%) 99.07 96 97.84 96.52 100 96.59 100 94.64 94.83 96.43

between its consumers and the managers engaged in the industry, public service and academia. To research current luxury experience brand equity model in Taiwan and Macao through different perspectives, and whether it has overcome the first lag (identification lag between the consumers and the practitioners) based on the SERVQUAL model proposed by Parasuraman et al. (1985), to provide a standard for the business strategic planning or development promotion of the related industries Figure 2). The following hypothesis is hypothesized: H1: Different viewpoints are significantly different in forming the identification of the luxury resort hotels brand equity. This research distributed 430 copies of questionnaires in Taiwan and 440 copies of the same questionnaires in Macao, during April 1 to July 31 2010. The response rate was 95.07 and 93.18% respectively (Table 2). To ensure construct validity of the measurement variable for each factor, we used confirmatory factor analysis (CFA) based on the critical values of test statistics proposed by Joreskog and Sorbom (2000).

effect, brand innovation and brand distance). While the research result indicates that each evaluation variable can disclose the form of the luxury brand equity for more than 56.3%, this means that luxury brand equity studied in this paper can be well predicted and constructed through any of them (Table 3). By ranking the average value of the luxury brand equity composition perspectives according to their importance, the researcher found out that consumers in Taiwan generally pay attention to the non-personal identification (extrinsic) perspective, such as identified top quality, while in Macao, people mostly focus on personal identification (intrinsic) perspective. In addition, it can be known from the decisive variable sets of each component that consumers in Taiwan is often influenced by the basic extrinsic perspective when evaluating luxury resort hotels, while consumers in Macao primarily depend on the extensive intrinsic equity. SUGGESTIONS AND CONCLUSION This discuss determines whether the consumers and experts in Taiwan and Macao have different viewpoints towards the awareness of the luxury resort hotels (H1); the focus discussed in this study. Additionally, its practical and academic value is verified. Reviewing the overall research design in this paper, it uses the expertise viewpoint to construct the judgment

THE LUXURY BRAND EQUITY FORMED BY THE CONSUMERS VIEWPOINT According to the five evaluation variables which have significant influence on the entire model of the luxury brand equity, this discuss will respectively explore the degree of influence in the composition of luxury brand equity (price premium effect, perceived supreme quality, market uniqueness, search cost reduction, brand by extension

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Table 3. The decision variables effect on each concept and relative importance.

Concept Taiwan Price premium effect Perceived supreme quality Market uniqueness Search cost reduction Brand extension effect Brand innovation Macao Price premium effect Brand distance Market uniqueness Search cost reduction Brand extension effect Brand innovation
1

Stepwise regression result Y=0.371X5+0.241X7; R2=0.612; F=103.22 2 Y=0.323X5+0.271X1; R =0.563; F=84.57 2 Y=0.418X7+0.357X5+0.311X1; R =0.719; F=78.52 2 Y=0.281X1+0.214X4+0.193X7+0.157X2; R =0.648; F=47.19 2 Y=0.354X5+0.288X1+0.247X4; R =0.581; F=32.77 Y=0.317X7+0.275X3+0.236X6; R2=0.674; F=92.31

Relative importance 5 (3.95) 1 (4.52) 4 (4.01) 3 (4.25) 2 (4.44) 6 (3.89)

Y=0.322X7+0.317X1+0.186X5; R2=0.732; F=134.67 2 Y=0.451X7+0.356X3+0.276X1+0.204X4; R =0.635; F=121.93 2 Y=0.367X7+0.333X3+0.241X6+0.110X1; R =0.729; F=76.54 Y=0.235X1+0.215X7+0.190X4+0.113X3; R2=0.651; F=156.21 2 Y=0.279X5+0.202X6+0.195X3+0.151X4; R =0.744; F=53.75 2 Y=0.437X7+0.321X3+0.176X1; R =0.687; F=107.29

5 (4.03) 6 (3.97) 2 (4.51) 4 (4.16) 1 (4.67) 3 (4.38)

brackets entries in the average value of each question, and the formation of the relative importance of each variable degree X1: brand awareness, X2: brand loyalty, X3: organization connection, X4: brand personality, X5: perceived brand luxury, X6: experience value, X7 : industry uniqueness; Y: measurement concept.

indicators of the luxury resort hotels, which is then taken as the basis in choosing subjects from Taiwan and Macao. Based on the literature review and interview results, it constructs the brand equity model of luxury experience and designs questionnaires and conduct tests on the consumers of luxury resort hotels selected in this research. It analyzes and verifies the relative data step by step according to the research hypothesis. Furthermore, it compares the experts and consumers awareness of the luxury resort hotels in Taiwan and Macao to know the variables that make up a luxury brand equity and the consensus degree of the luxury hotels between consumers and practitioners. Analysis of the awareness status of consumers and managers in Taiwan Consumers and experts in Taiwan have significantly different awareness status about luxury resort hotels, among which the biggest difference in awareness is produced by two indicators: consumers awareness is higher than general standard of price /value ratio (effectiveness of price premium) and advantageous geographic location and scale of operation (effectives of brand extension). Actually, when consumers in Taiwan make consumption decision in luxury resort hotels, they have generally accepted the price paid for the luxury products or service, while the price forming the value conversion effect during the actual experience process is not absolutely important to them. Experts think that the advantage in geographic location and scale of operation are not important indicators in

forming consumer awareness of luxury resort hotels. However, because the customer has serious information asymmetry with the related data for luxury resort hotels, this means they spend a lot in luxury resort hotels but what they obtain from it is only the experience, feeling, and memory, which is intangible, personal, as well as physical and mental improvement without substantial ownership. Therefore, consumers are usually cautious with their consumptions but are attracted to spend on luxury resort hotels due to brand, operation team, investment group, excellent service, traffic accessibility and other determinants of concept and information (Table 4). Analysis of the awareness status of experts and consumers in Macao Based on Table 5, consumers and experts in Macao have consistent awareness of the luxury resort hotels. This may be because the experts in Macao design the business operation and service content of the luxury resort hotels around customer service (even the planning and development of the tourism industry in Macao), integrating consumers expectation and interests to the hotels main development with emphasis on creation, innovation and sustainability as the development goal. MANAGERIAL IMPLICATIONS Expert viewpoint It is a basic concept for enterprise operation that enterprise image and operation strategy should be combined

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Table 4. Perceived luxury brand equity comparison between expert and consumer in Taiwan.

Concept

Decision variable Perceived supreme quality Brand extension effect Search cost reduction Market uniqueness Price premium effect Brand innovation

Luxury brand equity

Consumer viewpoint (a) 4.09 4.17 3.32 3.62 3.60 4.00

Manager viewpoint (b) 3.85 3.43 3.12 3.82 4.04 3.94

F 2.530 5.932 2.573 2.651 3.395 1.959

Scheffs post hoc comparison (a)>(b) (a) > (b) (a) > (b) (b) > (a) (b) > (a) -------

Table 5. Perceived luxury brand equity comparison between expert and consumer in Macao.

Concept

Decision variable Brand extension effect Market uniqueness Brand innovation Search cost reduction Price premium effect Brand distance

Luxury brand equity

Consumer viewpoint (a) 4.14 3.35 4.17 4.11 3.33 3.69

Manager viewpoint (b) 4.06 2.94 4.07 3.84 4.14 3.57

F 0.622 2.948 2.770 2.264 3.089 1.031

Scheffs post hoc comparison ------(a) > (b) (a) > (b) (a) > (b) (b) > (a) -------

combined with the consumers demands. Because enterprises usually regard this concept as slogan and vision, their final strategy or output design are all restricted by limited resources, economic benefit or environmental pressure, leading the enterprises to a tumultuous direction.Moreover, experts in Taiwan think that designing operation strategy based on the consumers viewpoints and expectation reflects the realization of customer service, while experts in Macao are prone to meet the consumers demands with systematic management methods. This is primarily because consumers still need to experience luxury passively through the luxury experience model designed by the practitioners. Therefore, luxury resort hotels should play three roles simultaneously, namely as service providers, designers of luxury experience and as cultural educators. Luxury is considered a social trend in the improvement of a consumers quality of life, it involves diverse and complicated perspectives and meanings. It is not only a product of social status or money gain but a new luxury movement which can provide richness in life and emotion, as well as broadening our mindset. Consumers viewpoint According to the luxury brand equity model constructed in this research, it can be obviously seen that consumers in Taiwan and Macao are both aware that brand loyalty and brand individuality have insignificant influence on their awareness of the luxury brand equity. For common enterprises, brand loyalty is a key factor to maintain the

consumers source and improve their performance; this factor does not have important influence on the consumers awareness of the luxury brand equity. This factor instead, may be caused by the industrial characteristics, namely, what the luxury resort hotels emphasize in its operation strategy and the enterprise image of breaking out of daily routines or being able to have a unique and amazing experience. However, the consumers interest in this kind of unique experience differs, thus making them prone to try different luxury resort hotels (different brands, locations and experiential designs) but at the same time, this does not increase the consumption frequency in the same location. This result suggests that luxury resort hotels should attach importance to conceptual basis like creation and innovation to develop their flexibility and adaptive ability of the entire service design and strategy making. As a result, the consumers desire of fulfillment in their consumption experience is met. With regard to the luxury brand equity construction of the luxury resort hotels, consumers attach more importance to the extensive intrinsic equity perspectives and relative variables (awareness of the luxury brand, experiential value and industrial individuality). This result is different from the relative research results in previous studies of brand equity. This is an important finding because this researchs primary subjects are luxury resort hotels; consumers evaluation of this brand depends on the experience process. During the short experience process, consumers experience genuine feelings and form interminable memories if they find the environment designed by practitioners, stimulating. All these characteristics are entirely different from the brand equity

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mainly found in tangible products or in industries with tangible products and warranty period. Therefore, for enterprises or operators focusing on service and experience, they should try to delve into the intrinsic or unique perspectives of brand equity thus making the brand better suited to the consumers real needs and desires. Comparison of the consumers and managers awareness of luxury resort hotels After making a comparison of the experts and consumers awareness of luxury resort hotels in Taiwan and Macao, the research indicates that the awareness level in Taiwan is relatively higher. This may be because practitioners of luxury resort hotels in Taiwan do not always change according to the consumption model or conduct synchronous strategy surveys and revise service process when consumption errors and other internal or external situation arises. In addition, the Taiwan market has no driving force for improvement and pressure of competition which can be attributed to the absence of famous, international hotel chains. On the other hand, the difference in awareness level of the consumers and managers in Macao about the luxury resort hotels is very minimal. This may be because that people engaged in the industry; public service and academia are practical partners and do their own duty to develop the tourism industry in Macao. Since engaging in the gambling industry, Macao has attracted famous, international hotel chains to invest and build hotels with brand individuality, providing options to consumers who are always seeking for a variety of luxury experience. It also stimulates all hotels to create incomparable visual impact to the best of their abilities. Customer equity is a key measure of customer relationship value, which is a critical determinant of the long-term value of a luxury resort hotels (Gupta et al., 2006; Hyun, 2009). As a conclusion, luxury resort hotels are all involved in a competitive relationship. They gain popularity through their brand image or operational team but all hotels maintain their business pattern (which does not encourage price war), thus creating the foundation of luxury hotels sustainable development through the industrial cluster effect.
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