Rui Qi

Date of Award

Summer 2019

Document Type

Open Access Dissertation


School of Hotel, Restaurant and Tourism Management

First Advisor

David A. Cárdenas


Due to the intangible characteristics of the service product, the tourism and hospitality industry relies heavily on advertising. This dissertation is composed of three interrelated studies, with the overall purpose to investigate advertising effectiveness within the tourism and hospitality industry from a firm-level perspective. Longitudinal and time-series models were employed to analyze firm-level accounting, finance, and marketing data. Overall, results provided supports for the strategic value of advertising in the airline, hotel, and restaurant firms. The first study’s findings indicate that the economic benefits from advertising expenditures, unlike other expenses, do not expire in the current period. In addition, advertising expenditures are significant strategic investments in intangible assets, providing greater future economic benefits than other assets. There is no significant heterogeneity regarding the effectiveness of advertising expenditures across sub-sectors in the tourism and hospitality industry.

The second study’s results indicate that Hilton’s advertising has a long-term effect on firm market value, beyond the impact of advertising’s influence on sales. Therefore, the branding effect of Hilton’s advertising expenditures on firm value is suggested, which coexists with the advertising’s tangible effect through sales. The long-run positive impacts are significant for Hilton’s advertising through television and the Internet, not through print and outdoor. The third study’s results show that hospitality and tourism firms with more advertising investments use less long-term debt. These results suggest the long-run costs of advertising in the debt market in the hospitality and tourism industry, providing supports for advertising budget allocations. Overall, this dissertation provides empirical evidence for the value relevance and risk relevance of firms’ advertising expenditures in the hospitality and tourism industry.

Available for download on Tuesday, August 18, 2020