A regional analysis of willingness-to-pay in Asian cruise markets

Abstract

This article tests whether the willingness-to-pay (WTP) of cruise tourists is affected by multivariables, namely regional level variables, socio-demographic variables, cruise perception variables, cruise motivations and cruise preferences. Our research aims to measure the influence of the multivariables on the WTP of cruise tourists, in order to trace the determinants of WTP. Using a censored regression model, the following variables are found to be highly associated with the WTP of cruise tourists: income, education, family structure, occupation, cruise experience, cruise duration and cruise preferences. The results of the modelling not only fill in existing research gaps in the theory of WTP but also shed new light on the comparison of multiple regions in terms of the difference of WTP of cruise tourists. A latent cluster analysis is further conducted to identify market segments with different cruise WTPs, and this knowledge can be used to improve the marketing performance of cruise companies in the growing Asian markets.