A modified Functionality Performance Evaluation Model for evaluating the performance of China based hotel websites.

ABSTRACT

As China becomes a member of WTO, her hotel industry will speed up its openness to the world. A natural outcome of such openness will enable the wide use of the Internet and World Wide Web in the industry. On the basis of the modified Functionality Performance Evaluation Model which consists of hotel website dimensions including facilities information, customer contact information, reservations information, surrounding area information and management of website, this research evaluates the content of China based hotel websites, and contrasts the hotel websites' performance among different hotel categories. The research commenced with a focus group discussion to redefine the features of the Functionality Performance Evaluation Model and to rate the importance of the components. Ninety hotels were chosen from different categories. Two investigators conducted the actual performance evaluation. The evaluation scores of the websites were used to compare and contrast the performance among three hotel categories. The results of analysis showed that the websites' performance was poor and that there was no significant difference detected on the website performance scores among the three categories of China based hotels.

1. INTRODUCTION

As the result of China's rapid economic growth and the increasing amount of disposable personal income, travel has become a way of life for most Chinese residents, which in turn, has accelerated the development of China's tourism industry. According to the official report in 2002, the worldwide tourism growth rate experienced 0.6 percent decrease in 2002, but growth continues in East Asia and the Pacific regions, just behind the Americas, which are the number two regarding the global market share. China was at the 5th place among the World's Top 15 Tourism Destinations in year 2000 and 2001 with the highest percentage increase of 6.2 percent in 2001 compared to 2000. Furthermore, China's outbound tourism increases rapidly. In 2002, 16.60 million people traveled abroad for both leisure and business purposes, representing a 36.84% increase compared to the year 2001. Among the travelers, 60.60% of them were leisure travelers with an increase of 44.87% compared to the year of 2001, and 39.40% were business travelers which had an increase of 26.08% compared to the year of 2001 (CNTA, 2002).

With the improvement of living standards and the development of telecommunications, the Internet users in China have increased rapidly. It has been reported by CNNIC (China National Network Information Center) in 2003 that the number of Internet users in China has reached 59.1 million, which was the number 2 country in the world in terms of number of users. The figures show that more and more Chinese have accepted the Internet and use the channel to get information and complete their travel planning. Milne and Ateljevic (2001) stated that the integration of computing and telecommunications would create a global information network based mostly on the Internet. In addition, the Internet, especially the World Wide Web, has had a great impact on the hospitality and tourism industry in recent years. The WWW plays an important role mediating between customers and hotel companies as a place for information acquisition and business transactions.

The hotel industry is now generally accepting the use of the Web for electronic commerce. According to Worldwide Technology Survey, 81% hoteliers worldwide considered to accept bookings over the Web in 1999 (Chung and Law, 2003). In China, more and more hotel managers and owners have realized the importance of Internet use, and have invested heavily to set up their own websites recently. This is to meet international standard, especially with the accession to WTO, the Chinese government encourages companies and organizations to set up websites with a series of policies. With the dramatic increase of websites, computer owners, and Internet users in China, China's tourism and hotel industry have noticed the growing potential market. How to enhance a hotel's image has become more important and urgent. Many companies may be questioning whether their WWW ventures are worth the effort, either economically or strategically (Murphy et al., 1996). In short, companies are trying to make their websites as informative and appealing as possible.

Attracting visitors is an important purpose of using the Internet as a marketing tool. Hoteliers, therefore, should use different strategies to attract and maintain customers in order to meet their different values. However, according to van Hoof and Combrink (1998) and Morrison et al. (1999), although the hotel owners or the managers had realized the importance of using the Internet, their actual behaviors were still limited. Wan (2002) had conducted a study to evaluate the websites of international tourist hotels and tour wholesalers in Taiwan. The research outcomes indicated that 50 percent of the sample hotels and tour wholesalers had established websites, and the variety of information of the user criteria performed the worst. Apparently, the use of the Internet in Taiwan's tourism industry is primarily for advertising, but not for marketing.

Perdue (2001) stated there was substantial evidence that the website quality impacts the image of a company. A website implies doing business on a global level (Huizingh, 2000). To establish a valuable website is a big challenge facing the hotel operators of Mainland China. It would be valuable to know the current situation of China hotel websites. This study, thus, is to evaluate the contents of China based hotel websites by category. Several issues were investigated according to the identified elements of the hotel web sites through this study. These issues included a comparative examination among 3 categories of China hotels. The study provides an evaluation framework for hotel websites and portrays the current situation of China's hotel websites. This study also offers information to the hotel industry by comparatively investigating and evaluating the attributes and application of hotel websites.

Websites are no longer limited to big companies and specific commercial sectors. Companies of any size and in any sectors can benefit from the Internet. However, this is not a guarantee of success to any company having a presence on the Internet. Knowing which customers want to access and their expectations are the crucial factors when starting to consider the feasibility of developing the Internet website for a business (Bell and Tang, 1998). Hotel websites were not only the place where a hotel placed information about its products and services, but it also has a commercial value in terms of profitability.

As the Internet grows and expands, the question for marketers is not merely how to get potential consumers to visit their websites, but also how to keep them involved. Good design is one of the most important factors of a successful website. Wu (2002) pointed out that most of China's hotel websites were only at the stage of advertisement for hotel's introduction and prices, whereas only a few hotels could offer the platform for customers to make reservation directly and transmit financial information securely. For China's hotels, especially the independent hotels, they often do not have professionals to establish good websites. They have noted the importance of having their own websites, but they simply require their EDP managers to design the websites or ask a company to do it without any proper evaluation. According to Huang and Law (2003), most examined hotels in China focus on providing product information, price information and contact information but not spending enough efforts on other components of marketing mix. As a result, 75% of business websites do not meet customers' requirements and need to be redesigned. What these sites lack are the proper contents, user-friendliness, and right presentation of information, so customers can easily locate what they want to find (Evans and King, 1999).

Although many articles have been published about the predicted size and involvement of tourism and hospitality on the Internet, very few studies have looked at the Internet and websites relating to the industry in China. This study is to analyze and measure the importance of the China based hotel website components and evaluate their performance, then to take through comparison study by hotel categories. Moreover, the research provides a guideline which measures the website performance and uses of websites for hotels in China.

2. LITERATURE REVIEW

2.1 The Application of the Internet to the Hotel Industry

Hotels have quickly capitalized the opportunities presented by developments in distribution technology. The hotel rooms were among the first products to be added to the expanded Global Distribution System. In the early 1990s, hotels acted rapidly to take advantage of the potential development of World Wide Web. By the end of 1996, 80% of the world's top hotel chains had established their websites, but the majority of these sites were limited in scope. They only composed of simple text and graphical pages basing on brochures and other publicity materials. They failed to take advantage of the specific features of the websites. In late 1990's, research showed that a "buy direct" option had been provided by the well-known brands because of consumers' increasing expectation. In recent years, many hotels have been using the Web to promote last minute deals--packages at relatively low prices with very short lead times (O'Connor and Horan, 2001).

The Internet marketing is well suited for tourism-related products and services because of their distinctive high-priced, high-involvement, and well-differentiated characteristics (Morrison et al., 1999), and that there are six potential advantages for having a Web presence for hotels: cost reduction, revenue growth, niche marketing, improved customer satisfaction, quality improvement, and addressing other critical business or customer needs, van Hoof and Combrink (1998) conducted a study that shows six major benefits for hotel: exposure of hotel, advertising and marketing, faster and better communication, generating reservation, a good source of information on other hotels, clients and the industry, and saving costs and time. The hotel industry is a fast-changing industry and the Internet certainly has an impact on it. Huang and Law (2003) stated that many hotels in China had already realized the importance of the Internet and had been working hard to establish their own websites. They anticipate that these websites would enhance the hotels' image, attract more customers and promote sales. Gilbert, Powell-Perry and Widijoso (1998) emphasized that the true determinant of using websites was the willingness of customers to book hotel rooms and to search for hotel information.

Travel and tourism comprise a significant share of Internet advertising and e-commerce (Perdue, 2001). According to the Travel Industry Association of America (TIA, 2002), over 39 million Americans booked travel products using the Internet in 2002, up 25% over the year of 2001. Airline tickets continued to be the most frequently purchased travel products online, reported by 77 percent of all online travel bookers, followed by hotel accommodations at 57 percent and car rentals at 37 percent. Moreover, the distribution of these expenditures across travel sectors is changing. In 1996, 90 percent of on-line travel expenditures were for airline tickets. (TIA, 2002).

In the present lodging industry, the web is making great contributions to hotel marketing efforts by offering interfacing with customers. Hotels are striving hard to enhance their websites' interactive capabilities since customers' accessibility to hotel websites increases. They are seeking personalized information, expecting interactive communications with their counterparts, and obtaining new market value, which hotels add onto their products and services (Jeong and Lambert, 2001). The more computer literate the consumers are, the more likely these customers will buy through telematics-based direct channels such as WWW. As the younger generation is much more computer literate than the older generation, they also become active e-consumers. These young travelers are more likely to make use of the Internet and WWW than their parents (Marcussen, 1997). In addition, budget traveling has become a fashion in recent years in China, especially for the young travelers who prefer to get information through the Internet and websites for hotels, tickets, tours and other information (CNNIC, 2003).

Gilbert, Powell-Perry and Widijoso (1998) identified that the web mechanisms were used as the aspects of information, reservation, loyalty program, newsletter, special gestures, feedback, customer service, public relations, value-added services, employee website, channel member website, and customized research. They pointed out that the websites had the potential to be a strategic information center for the hotel industry that would offer features such as electronic brochure, corporate information (press releases, financial reports, company history, company milestones, product and service information), online directory, property information, what's new, virtual hotel tour, special promotions, and language localization selection by the browser.

The number of Internet users has increased significantly over the past few years, in the computer-mediated environment, customers' purchasing decisions on products and services could be determined by their perceived quality of information. Internet users appeared to spend more money, travel by air and stay in a commercial hotel establishment when compared to nonusers. They would like to make an online shopping when the website was innovative, useful, informative, interesting, attractive, concise, clear, fun and/or personal (Jeong and Lambert, 2001).

According to Jung and Butler (2000) as well as Huang and Law (2003), most hotel marketing managers recognized the Internet as a very effective marketing, reservation, and promotional tool. With the changes of their views on the effectiveness of the Internet as a marketing tool over the last few years, they expect that the importance of the Internet as a marketing tool and marketing strategy would become even greater.

Four factors that are critical to website success were identified: (1) information and service quality, (2) system use, (3) playfulness, and (4) system design quality. The designers of sites thus need to ask themselves why people are seeking information and how these demands can be met as communication via the WWW requires the identification of a WWW visitor with a place (Cano and Prentice, 1998).

2.2 Internet and China's Tourism and Hotel Industry

The start of the Internet connection in China started in the year of 1994. In October 1997, the China Internet Network Information Center began to issue statistical reports on the growth of Internet applications in China. In just a few years after that, the Internet has experienced a rapid growth reflected from many aspects including network infrastructure, number of Internet users and others. The Internet Domain Surveys, conducted by CNNIC, have shown that business investment is moving unabated onto the Internet. By the end of year 2002, the number of websites all over China had reached 371,600, a 34.1% increase over the previous year. Among all websites, enterprise websites take the largest proportion of 77.8%, which occupied 4.5% online hotel reservation service among the websites main services (CNNIC, 2003). The phenomenon of organizations setting up their websites to conduct business has also filtered down to the hotel industry.

According to the latest statistics conducted by CNNIC, by June 30, 2002, the number of host computers in China had reached 16.13 million, increased by 3.59 million units in the past 6 months, representing an increase of 28.6%. Compared to the same period last year, it is an increase of 61.0%, and it is 54 times the 299,000 units estimated from the first survey in October 1997. The CNNIC surveys also present the increase rates of host computers that reflect the increase rate of using the leased line is higher than that of dial-up computers and the total number of computers connected to the Internet. This shows that Internet access via the leased line or by other means is increasing with a faster rate although dial-up connection still remains the main channel. The diversification of Internet access will promote the growth of the Internet use in China.

The utilization of computer networks in the tourism industry in China is at the beginning stage. In 1997, the CNTA (China National Tourism Association) went on the Internet, which indicated that China tourism organizations have been aware of the role of computer network in tourism development and taking advantages of the Internet (Zhang, 2000).

Zhang (2000) indicated that the development of China's electronic information industry lags behind that of developed Western countries. Based on the degree of computer utilization and the popularity of computers remaining, the majority of travel services in China still relies on conventional means of communication such as telephones and faxes in business operation.

Huang and Law (2003), however, stated that most of Mainland China hotels mainly focus on providing product information, price information and contact information and typically remain in the stage of 'electronic brochure'. The general features of China based hotel websites are uninformative, unattractive and non-interactive.

2.3 Prior Studies on Hospitality Websites Evaluation

Jeong (2002) carried out a study to evaluate 35 websites in an effort to identify the values that the websites were likely to provide to their customers. Based on the Commercial Web Sites Evaluation Matrix that specified three purposes and four values of commercial websites, companies build their websites in order to provide these three purposes including promotion of product and services, provision of data and information, and processing of business transactions. By using websites, customers obtain four types of values identify timeliness, degree of customization, supporting logistics, and sensational characteristics. Jeong enrolled 70 hospitality students to evaluated 35 websites of chain properties. Results of the study showed that the majority of lodging websites were featuring product promotion, but they were lacking emphasis on motivating potential customers. Jeong suggested that hoteliers should use different strategies to attract visitors.

Liu and Arnett (1999) conducted a research project to measure four critical factors identified as information and service quality, system use, playfulness, and system design quality to website success in electronic commerce (EC). They got an electronic questionnaire survey of webmasters from Fortune 1000 companies. Based on the results, website success in the context of EC is related to four major factors: quality of information and service, system use, playfulness, and system design quality. They stated that organizations that launch websites should be more aware of these factors.

Yip and Law (2002) carried out a study to analyze the information types for the Hong Kong Disneyland that will be opened in year 2005. They collected 198 respondents' questionnaires. According to the results, their suggested attributions for the Hong Kong Disneyland which are homepage information, products/services information, and ticket information and e-ticketing should be listed in the Hong Kong Disneyland website.

Jeong and Lambert (2001) tested a framework to evaluate the information quality of simulated lodging websites. Four propositions were proposed, which were perceived usefulness, perceived ease of use, perceived accessibility, and customer's favorable attitude. According to the findings that of the four constructs of information quality, perceived usefulness and attitudes were found to be the significant indicators to predict the customers' purchase behavior using the lodging websites.

Lastly, Chung and Law (2003) conducted a research study to measure the content of Hong Kong hotel websites and proposed a Functionality Performance Evaluation Model of websites. They developed a conceptual framework of hotel websites components, which consisted of five dimensions with different attributes. The research studied 80 hotel websites for their dimensions of facilities information, customer contact information, reservations information, surrounding area information, and management of website. The findings concluded that the reservations information was rated as the second most important attributes, scored the highest at 57.89 out of 100 was the best among five dimensions. But the most important attribute, the facilities information, scored only 46.21 out of 100 was second of the worst performance. The results indicated that the hotel websites of the higher category hotels were more comprehensive than that of the lower category hotels.

Chung and Law's research was conducted and the evaluation of hotel websites was based on the above five dimensions, attributes concerned for each dimension were identified as follows:

* Facilities information consists 11 website attributes including photos of hotel features, hotel descriptions, hotel facilities, guest rooms facilities, hotel location maps, hotel promotions, virtual tours, restaurant, frequent guest program, meeting planner and employment opportunities.

* Eight attributes are included in Guest Contact Information and they are e-mail address, telephone number, hotel address, facsimile number, online forum feedback form, Frequently Asked Questions, and what's new / press release.

* Reservation information involves room rates, check rates & availability, online & real time reservations, reservations policies, view or cancel reservations, worldwide reservations phone numbers, security payment systems, check in & check out time, special request forms and payment options.

* Surrounding Area Information includes transportation, airport information, main attractions of the city, general information and public holidays.

* Management of websites concerns up-to-date information in the site, multilingual site, site map, search function and links to partners.

Although researchers have investigated different aspects of the performance of hotel websites, the study of China based hotel websites has largely been overlooked in the existing hospitality and tourism literature. This research described in this paper, thus, makes an effort to bridge such a gap.

3. METHODOLOGY

The Internet, and particularly the World Wide Web (WWW), is currently one of the most significant technological developments pertaining to travel and tourism marketing. This study aims at evaluating the performance of star-rated hotels in Mainland China using the Functionality Performance Evaluation Model proposed by Chung and Law (2003) as a tool for evaluating hotel websites. The Functionality Performance Evaluation Model was based on the perception of Hong Kong hotel managers. The applicability might be different with different regions and cultural background. Therefore, the evaluation model was further modified through comprehensive studies and then finally discussed by a panel discussion conducted in China.

In this study, a content analysis was carried out to examine the performance of hotel websites. This method is thus a quantitative means of analyzing qualitative data. A content analysis, as a formal approach to qualitative data analysis, is a way of systematically converting text to numerical variables for quantitative data analysis and it is often used for analysing newspapers and advertisements (Finn, Elliott-White and Walton, 2000). In other words, a content analysis was a technique that had applications in tourism research since its focus on secondary material and media analysis.

In this study, the selection of hotel is based on the following criteria:

* Independent Hotel

This study only focuses on independent hotels both in China.

* Downtown Business Hotels in Major Cities

Internet and WWW technology are mostly used for commercial purpose. This study will only select those hotels that target business and corporate market. Most of those hotels are located in the city center of business cities.

* Hotel Rating by different classification

The hotel industry in China adopts a star-rating system with 5 categories including 1-star, 2-star, 3-star, 4-star and 5-star according to China National Tourism Association. The China star-rating system is similar to the US diamond-rating system, which is all based on facilities, services and amenities (VCTS360.com, 2003; Happytours.com, 2003). This study also concentrated on evaluating the performance of 3- to 5-star ratings. The 1- and 2-star hotels were excluded because of their low visibility on the internet.

* Hotel website Search

To search a proper hotel website according to the aforementioned criteria, the searching process was conducted by the following steps:

* Firstly, the investigators search the hotel websites through the largest China based travel websites www.ctrip.com. The hotels in capital city or the biggest city of each province in China were then searched. Each hotel matched the criteria will be selected after viewing the detailed information of the hotel on the travel sites. Then the URL (Uniform Resource Locator) of the hotel was searched by the international search engine www.google.com.

* Since the investigators cannot find enough websites through www.ctrip.com, more hotels were then searched by the keyword with 'city name+hotel rating' through www.google.com. Each listed independent hotel's URL was entered and viewed; matched hotels were selected until 30 hotel websites for each category were found.

* Finally, a total of 90 hotels were chosen for this study. Each category has 30 samples.

The research process is divided into 4 phases, which is shown in Figure 1.

[FIGURE 1 OMITTED]

As aforementioned, in the original Functionality Performance Evaluation Model, Chung and Law (2003) were to analyze the content of hotel websites. They proposed a conceptual framework that consisted of five dimensions including Facilities Information, Customer Contact Information, Reservations Information, Surrounding Area Information and Management of website. This model covers the major application of hotel websites like propaganda tool, communication tool, marketing & distribution channel, customer service centre, as well as management of websites.

However, the model was completely based on the perception of respondents with hotel background, which might be biased without the involvement of customers. The model evaluated performance based on some dimensions and attributes related to hotel facilities and services, which might not be suitable for different category of hotels. Additionally, the model was proposed in Hong Kong while there might be different results by different focus groups from different cultural and geographical backgrounds. Therefore, this study will improve the model in a couple of aspects. Firstly, the researchers selected the respondents of the focus group from different background like hotel managers, tour operators, technicians and travelers in Mainland China. Secondly, the dimensions and their attributes were validated by the panel members.

3.1 The Evaluation Process

A group discussion was conducted in December 2002 in the city of Guilin, China. Eight respondents including 4 males and 4 females, with background of hoteliers, business travelers, leisure travelers, travel agents, and online reservation managers respectively, discussed and improved the Functionality Performance Evaluation Model and then were required to weight the importance for each website variable.

The participators were asked to weigh the importance for each dimension and attribute according to their perceived information to a hotel websites and the Functionality Performance Evaluation Model. The importance ranking score (weighted score) for dimensions and attributes was both calculated based on the proportion of 100% by the following formula:

[bar]Wsdi: Weighted mean score of each dimension

n: Number of respondents

[W.sub.r]: Weighted score of each dimension by a respondent

(1) [MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII]

[bar]Wsci: Weighted mean score of each attribute

n: Number of respondents

[W.sub.r]: Weighted score of each component by a respondent

(2) [MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII]

subject to: [MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII]

The performance for each attribute was evaluated first by 5-point Judgmental scale according to the performance of attributes (Table 1) by two investigators. Following Wan's (2002) approach, if the two scores given by investigators for each attribute differed by less than 2 points, the average of the two scores was taken as the final rating. If the two scores differed by more than one point, the two investigators evaluated the website again and determined the final rating (Figure 2). The Judgmental system and Judgmental scale are as following:

TABLE 1 WEBSITE'S 5-POINT JUDGMENTAL SCALE

0       1         2           3            4            5

Nil   A few    All key   Key          Key          Key
      attri-   attri-    attributes   attributes   attributes
      butes    butes     plus some    plus all     plus all
      Listed   listed    of sub-      sub-attri-   sub-attri-
                         attributes   butes        butes and
                         listed or    listed       most of
                         some of                   special
                         special                   attributes
                         attributes                listed

[FIGURE 2 OMITTED]

Adapted from: Wan (2002)

Score A: given by Investigator A

Score B: given by Investigator B

The performance score was used to indicate the website performance for dimensions and attributes. After evaluating website performance by the 5-point judgement scale as indicated in Table 1, a performance score was then computed by multiplying the 5-point score with 20, resulting in a 100-point scale score. The calculation is presented in the following approach.

[W.sub.r]: Weighted score for each dimension by each respondent

Wcsi: Weighted score of each attribute

Pji: Performance scale of each dimension

Psi: Performance score of each attribute

Pmd: Overall performance score of a specific attribute

i: attributes (1,2,3 ... n)

(3) Psi = Wsi x Pji x 20%

(4) [MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII]

Then percentage score ([P.sub.s]) was used to indicate the website performance based on the 100-point Judgmental Scale. The percentage score was calculated by the following way:

Ps = Percentage Score Pm = Performance Score

Ws = Weighted Score

(5) Ps = Pm / Ws

Since the performance score of each attribute was calculated within a proportion of 100 percent, the percentage score of each dimension is calculated by:

(6) [MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII]

Finally, the whole website performance score was calculated by the following formula, and a mapping was done using the scale as delineated in Table 2:

O: Overall Score of a website

Wsi: Weighted Score of each dimension

Pmi: Performance score of each attribute

i: dimension (1,2,3 ... n)

odi: Wsi x Pmi/100

(7) [MATHEMATICAL EXPRESSION NOT REPRODUCIBLE IN ASCII]

4. FINDINGS

4.1 Results of the Focus Group Discussion

A focus group discussion was conducted in December 2002. Eight respondents including 4 males and 4 females, with background as hoteliers, business travelers, leisure travelers, travel agents and online reservation managers respectively, were required to weigh the importance for each website variable. All group members were experienced travelers who had previously visited hotel websites. The importance was weighted not only from the hotel operators' point of view, but also from the standpoint of hotel customers.

In the conceptual framework of the Functionality Performance Evaluation Model, websites consisted of five dimensions: 'Facilities Information', 'Customer Contact Information', 'Reservation Information', 'Surrounding Area Information', and 'Management of websites'. Each dimension has its own attributes.

The dimensions were ranked as proportion of 100 percent, and then the attributes of each dimension were ranked by the same method.

The results of the group discussion concerning the importance rating of dimensions and the average weighted score were summarized in Table 3.

Table 3 shows the perceived importance weighted scores, the most important dimensions were 'Facilities Information' and 'Reservations Information' which scored 26.38 and 26.13 respectively, whereas the least important features was 'Surrounding Area Information' which was scored 11.62.

The group endorsed the existing attributes among each dimension listed in Functionality Performance Evaluation Model, and additional attributes were also suggested for some dimensions. The additional components, 'Person to Contact', 'Privacy Policy' & 'Currency Converter', and 'Multimedia' were added to the dimensions of 'Customer Contact Information', 'Reservation Information' and 'Management of websites' respectively.

4.2 Overall Performance of China's 3-star Hotel websites

Table 4 provides a total score on website performance. The total mean score 27.31 out of 100 showed that the websites were rated as poor. Compared to its individual performance, the score indicated that 'customer contact information' was satisfactory with score 45.15. 'Facilities information' and 'management of website' were rated as poor with scores 39.69 and 24.76 respectively. 'Reservation information' and 'surrounding area information' performance were evaluated as very poor with their percentage scores of 12.83 and 6.14 respectively. Comparing to the weighted score, the most important variables 'Facilities Information' and 'Reservation Information' and the least important variables were 'management of website' and 'surrounding area information'. However, the best performers were 'Customer Contact Information' and 'Facilities Information' whereas the worst performers were 'Surrounding Area Information' and 'Reservation Information'.

4.3 Overall Performance of China's 4-star Hotel websites

Table 5 shows the website performance results of China's 4-star hotels. The dimensions of 'facilities information' and 'customer contact information' were performed as satisfactory with their performance mean scores at 40.91 and 43.73 respectively. The dimensions of 'management of website', 'reservation information' and 'surrounding area information' were rated as poor and very poor with the performance mean scores at 31.68, 21.72 and 4.39 respectively. The total score 30.73 out of 100 was rated as poor on overall websites performance. The results showed that the most important variables were 'Facilities Information' and 'Reservation Information' and the least important variables were 'Surrounding Area Information' and 'Management of website'. But the best performers were 'Costumer Contact Information' and 'Facilities Information' and the worst performances were 'Reservation Information' and 'Surrounding Area Information'.

4.4 Overall Performance of China's 5-star Hotel websites

Table 6 illustrates the websites' performance of China's 5-star hotels. The whole websites were rated as poor with the total performance mean score at 31.49. In terms of dimensions, the variable individuals were performed as satisfactory in 'facilities information' and 'customer contact information' with the performance mean scores at 43.66 and 44.22 respectively, whereas 'management of websites' performed poorly with its performance mean score of 32.57 while the 'reservation information' and 'surrounding area information' were rated as very poor with performance mean scores at 19.63 and 8.75 respectively. The results indicated that the most important variables were 'Facilities Information' and 'Reservation Information' and the least important variables were 'Management of website' and 'Surrounding Area Information'. The best performers, however, were 'Customer Contact Information' and 'Facilities Information' whereas the worst performers were 'Reservations Information' and 'Surrounding Area Information'.

4.5 Overall comparison among 3 categories of China Hotels

Table 7 shows the comparison result of websites performance with both dimensions and overall evaluations among three categories of China based hotels. The result indicated that there was no significant difference within groups for all dimensions except 'Management of websites' among three categories of China based hotels. From an overall perspective, there was also no significant difference within groups among these categories.

5. DISCUSSION AND CONCLUSIONS

This research aims at measuring the performance of hotel websites by a comparison evaluation among three categories of China based hotel websites respectively. Based on a proposed website functionality performance evaluation model, a total of 90 hotel websites were measured and analyzed by categories. The evaluation model used consists of five dimensions including facilities information, customer contact information, reservation information, surrounding area information, and management of website with 43 attributes in total.

In summary, the performance of hotel websites is not related the hotels' star rating. There was no significant difference among the three categories of China hotels, in which all categories received poor performance rating. China hotels received a satisfactory performance in the dimensions of 'Hotel Facilities' and 'Customer Contact Information'.

However, poor and very poor performance ratings were received in the dimensions of 'Reservation Information', 'Surrounding Area Information' and 'Management of websites'. This result revealed that China based hotel websites lean toward promotion purpose with introduction and contact method. However, website management such as "updating" was downplayed.

More and more international hotel chains have entered China and compete with China independent hotels. Though there is not much difference between China hotels and International hotels regarding facilities and services, the disparity of Internet application will influence the future competition. Currently, most customers in China still use conventional ways like phone or fax to communicate with hotels whereas many Western customers have been using the Internet for reservations. The rapid development of the Internet and WWW in China will change customer behavior soon. China hoteliers, hence, need to make more efforts for the application of Internet to meet the increasing marketing demands.

5.1 Industrial Applications

After becoming a member of WTO and being the host of 2008 Olympic Games, China will speed up its opening to the world. The Internet will continuously serve as an important medium for interactive communication. The industry could make full use of the Internet to distribute its products, provide customer services, and gain market share by establishing its 'Virtual Hotel' on the web. This paper, however, argues that there does not exist any benchmark for hoteliers and hotel guests to use as a reference when they need to determine the quality or performance of a hotel website. Such a benchmark will help users better understand the overall standing of a specific website, facilitating better decision making. By comparing and contrasting different applications on websites, the China hotel industry could learn how to measure a successful hotel website and use the Internet not only as a promotion tool but also as an interactive communication tool, distribution channel, and customer service center.

As an interactive communication tool, the Internet could enhance communication with customers. The provision of telephone number, fax number, email and address offer contact information only for one-way communications. Hotels, however, could offer interactive methods like online forum, FAQ, feedback forms and news release on the site to realize two-way communications.

Hotels could use this distribution channel to process reservations on the website. Compared to conventional distribution channels like travel agents, tour operators and hotel wholesalers, the Internet can provide hotels a 24-hour opportunity to interface with customers all over the world. Moreover, the Internet can help hotels to save costs for distribution without any commission. From a customer's perspective, an instant confirmation and real time process would be made through the Internet, which is very helpful for customers.

As a customer service center, the provision of more value-added services like surrounding area information could strengthen the customers' understanding and confidence to the hotel and increase the traffic to its site.

Lastly, the management of website is very important. Customers will be tired of a site with unchanging content. A friendly, easy-to-navigate, and well designed website can make the site more attractive. A multilingual site can help hotel market its product globally.

5.2 Future Research

Up to now, people are generally unaware of the importance of website optimization. The website will be useless no matter how powerful its functions are if nobody can find the website from the numerous 'web pages'. Haig (2001) commented that the single most important way to generate traffic is to get a good ranking on the main search engines. Most surveys claim that over 80 percent of people search information online through a search engine and 95 percent of visitors in a website infancy are from main engines. Therefore, the main 'currency' of a site is traffic. It is important to optimize a website when a hotel builds a new website or completely renovates an old one. It is therefore very crucial to consider how the site is indexed and ranked among major search engines through website optimization.

Additionally, performance of usability on a site is also important. Most studies have focused on functionality of websites, but usability is key to a successful website. Usability reflects the relationship between the site and its users and decides the quality of a website that makes it friendly to use, easy to remember, error tolerant, and subjectively pleasing. In order for a website to be more effective, it must allow users to visit and use the website in the best possible way. Usability depends on a number of factors including how well the functionality improves the user's satisfaction and how convenient the website fits a user's needs.

This study is a cross-sectional study and has its limitations. It does not evaluate all relevant factors, which could influence a success of a site. Further research should be conducted from both functionality and usability perspectives.

TABLE 2 WEBSITE'S 100-POINT JUDGMENTAL SCALE

 0-20    Very Poor

21-40    Poor
41-60    Satisfactory
61-80    Good
81-100   Very Good

TABLE 3 PERCEIVED MEAN SCORE FOR DIMENSIONS

Dimension                                   Weighted Mean Score

Facilities Information ([W.sub.d1])         26.38
Reservations Information ([W.sub.d2])       26.13
Customer Contact Information ([W.sub.d3])   18.25
Management of website ([W.sub.d4])          17.63
Surrounding Area Information ([W.sub.d5])   11.62
Total Score *                               100

Remark: 1. Weighted Mean Score was computed by equation 1.

TABLE 4 PERFORMANCE OF CHINA'S 3-STAR HOTEL WEBSITES IN 5 DIMENSIONS

                               Weighted Mean Score   Performance
Dimension                      ([W.sub.di])          Mean Score

Customer Contact Information   18.25                 45.15
Facilities Information         26.38                 39.69
Management of website          17.63                 24.76
Reservations Information       26.13                 12.83
Surrounding Area Information   11.62                 6.14
Overall websites Score               100.00          27.31

TABLE 5 OVERALL PERFORMANCE OF CHINA'S 4-STAR HOTEL WEBSITES

                               Weighted     Performance
Dimension                      Mean Score   Mean Score

Customer Contact Information   18.25        43.73
Facilities Information         26.38        40.91
Management of website          17.63        31.68
Reservations Information       26.13        21.72
Surrounding Area Information   11.62        4.39
Overall websites Score         100.00       30.73

TABLE 6 OVERALL PERFORMANCE OF CHINA'S 5-STAR HOTEL WEBSITES

                               Weighted     Performance
Dimension                      Mean Score   Mean Score

Customer Contact Information   18.25        44.21
Facilities Information         26.38        43.66
Management of website          17.63        32.57
Reservation Information        26.13        19.63
Surrounding Area Information   11.62        8.75
Overall Performance Score      100.00       31.49

TABLE 7. AN OVERALL COMPARISON WITH DIMENSIONS AMONG 3 CATEGORIES
OF CHINA HOTELS

                          3-star              4-star

                                  Std.                Std.
Dimensions                Mean    Deviation   Mean    Deviation

Facilities Information    39.69   9.90        40.91   6.84
Customer Contact          45.15   11.42       43.73   14.20
  Information
Reservation Information   12.83   8.74        21.72   18.16
Surrounding Area          6.14    9.87        4.39    7.55
  Information
Management of             24.76   10.01       31.69   11.17
  websites
The Whole website         27.31   6.64        30.73   8.63

                          5-star

                                  Std.
Dimensions                Mean    Deviation   Sig.

Facilities Information    43.66   12.98       0.311
Customer Contact          44.21   16.81       0.927
  Information
Reservation Information   19.63   22.26       0.122
Surrounding Area          8.75    11.42       0.224
  Information
Management of             32.57   11.08       0.011 *
  websites
The Whole website         31.49   11.06       0.178

Remarks: 1. One Way ANOWA was used.

2. * significant at [alpha]= 0.05

5.3 ACKNOWLEDGEMENT

The authors acknowledge the contributions of all participants in the focus group discussion.

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Kathy Liang, M.Sc., is a senior hotel executive in Mainland China.

Dr. Rob Law, Ph.D. is an associate professor of information technology at School of Hotel & Tourism Management, the Hong Kong Polytechnic University.