The impact of information security breach on hotel guest perception of service quality, satisfaction, revisit intentions and word-of-mouth

Purpose - The primary purpose of this study is to investigate the impact of information security breaches on hotel guests' perceived service quality, satisfaction, likelihood of recommending a hotel and revisit intentions. Design/methodology/approach - Five-hundred seventy-four US travelers participated in this experimental study. The respondents were exposed to one of three different scenarios: "negative", where an information security breach happened in the hotel where a person stayed last and guest information was compromised; "neutral", where an information security breach happened and guest information remained safe; and "positive", where participants were told that the hotel where they last stayed successfully passed a comprehensive security audit, meaning that their guest information is properly handled and secured. Findings - The results of the study revealed a significant impact of the treatments on three of the four outcome variables: satisfaction, likelihood of recommending a hotel, and revisit intentions. Information security breach scenarios resulted in a negative impact on the outcome variables regardless of whether or not the guest's credit card information was compromised. A positive scenario revealed a significant increase in guest satisfaction and revisit intentions scores. Practical implications - The findings of the study provide clear indication that hotel operators must continually strive to keep the sensitive data that is collected from their guests secure, and that failure to do so can have significant negative ramifications on current and future guests. The results also suggest that hotels should openly publicize their achievements in the field of PCI compliance. Originality/value - The study contributes to the body of knowledge on the importance of credit card information security breaches to hotel guest satisfaction and future behavior. To date, this is the only study that has investigated this topic in the hospitality industry, and it therefore makes a significant improvement towards the understanding of the impact of information security breach on hotel guest perceptions and future intentions.