How do hotel managers react to rating fluctuation?

Rating fluctuation is inevitable for hotels listed on hotel booking platforms, which induces potential consumers’ perception of uncertainty and risk. Managerial response is expected to be effective in enhancing the interaction between hotels and consumers. However, how hotel managers react to rating fluctuation remains unclear. In order to fill this gap in the literature, we collect customer reviews and managerial responses from a leading hotel booking platform and build a panel dataset (hotel*month). The empirical results suggest that (1) rating fluctuation induces more managerial responses and requires more response time; (2) upscale hotels are more likely to conduct frequent and timely responses when facing rating fluctuation; and (3) hotels tend to respond more frequent and timely once rating fluctuation is observed by a larger audience. This study concludes by presenting theoretical contributions to the literature and practical implications for operators of hotel booking platforms and hotel managers.