International Journal of Hospitality Management 39 (2014) 29–40 Contents lists available at ScienceDirect International Journal of Hospitality Management jo u r n al homep age: www.elsevier.com/locate/ijhosman Competitor set identification in the hotel industry: A case study of a full-service hotel in Hong Kong Ibrahim Mohammed, Basak Denizci Guillet ∗ , Rob Law School of Hotel and Tourism Management, Hong Kong Polytechnic University, Hong Kong Special Administrative Region a r t i c l e i n f o Keywords: Competitor identification Competitive set Corporate identity Hong Kong a b s t r a c t Despite the importance of competitor identification in the hotel industry, the process of identifying competitors remains unclear to industry practitioners. This study aimed to provide further insights on the frameworks that can be used by industry practitioners to identify competitors. The objectives of this study were to describe the managerial procedure for competitor identification adopted by a full-service hotel in Hong Kong and to evaluate the outcome of this procedure by comparing the competitor set identified by the managers with those independently identified by the hotel’s guests. Applying a descriptive research design involving interviews with the top management of the hotel and a survey with the hotel’s guests, the findings revealed that the managers followed a three-step process to identify their competitors, namely: (a) defining the corporate identity of the hotel; (b) scanning the market for potential competitors, and (c) matching and choosing hotels with similar corporate identities. Furthermore, a close match was found between the competitors identified by both the managers and the hotel’s guests, indicating that the managerial approach to the competitor identification was reflective of the customers’ perspectives. A significant contribution of this study is that it has unveiled an additional framework for competitor identification which suggests the need for corporate marketers and industry practitioners to pay critical attention to corporate identity management. © 2014 Elsevier Ltd. All rights reserved. 1. Introduction Virtually every industry in today’s business world is charac- terized by a degree of competition, and the hotel industry is no exception. Like many other industries, competition in the hotel industry arises mainly from the existence of a large number of hotels offering substitutable products (Matovic, 2002). Scarce data available on the global supply of hotels and hotel rooms show that, the number of rooms supplied by hotels and similar estab- lishments has been growing. According to a report by Mintel (as cited by hotelanalyst.co.uk), the global supply of guestrooms by hotels and similar establishments was estimated to be around 20.1 million in 2008 with an estimated annual growth of 2.2% over the last five years. A similar report by Smith Travel Research (STR) Global (cited by hotelanalyst.co.uk) also revealed that the estimated size of the global hotel industry (excluding similar establishments) was in the region of 11 million rooms as at 2009. Consistent with the global growth trends, there has been a rapid growth in the ∗ Corresponding author. Tel.: +852 34002173. E-mail addresses: ibrahim.mohammed@connect.polyu.hk (I. Mohammed), basak.denizci@polyu.edu.hk, hmbasakd@polyu.edu.hk (B.D. Guillet), rob.law@polyu.edu.hk (R. Law). size of the Hong Kong hotel industry in the recent decade. Within thirteen years, the number of hotels increased more than 100%, from 95 hotels in 2000 to about 211 in 2012 while the supply of hotel rooms expanded by almost 82%, from 36,749 to 67,394 (Information Services Department of HKSAR, 2000, 2012). During the same period, the absolute numbers of rooms sold per day gen- erally rose (except for 2001, 2003 and 2009, the years for 9/11 terrorist attack, SARS disaster and global financial crisis respec- tively) with occupancy rates hovering between 70% and 89% and averaging around 85%. Given these flurry growth rates, the Hong Kong hotel industry has been characterized by a problem of over- capacity (Tsai and Gu, 2012) with the attendant result being a more competitive market structure. As the Hong Kong hotel industry continues to battle with competition, hotel managers have become more interested in competition issues, particularly, how to identify competitors for effective and meaningful analysis. Economics and business literature have emphasized the importance of competitor iden- tification in a competitive business environment and the adverse consequences of identifying wrong competitors have also been well-documented (see Clark and Montgomery, 1999; Baum and Lant, 2003). Yet, little is known about managerial process of competitor identification (Clark and Montgomery, 1999). To highlight this gap, hospitality researchers (e.g. Kim and Canina, http://dx.doi.org/10.1016/j.ijhm.2014.02.002 0278-4319/© 2014 Elsevier Ltd. All rights reserved.