Effects of perceived value on satisfaction and revisit intention: Domestic vs. international tourists

Abstract

Despite the availability of a considerable body of research examining large-scale hotels, small-scale accommodations like traditional guesthouses have been overlooked. Using the hierarchy of effects model, this paper seeks to investigate and compare the effects of perceived value dimensions (e.g. functional value, emotional value, and social value) on the satisfaction and revisit intentions of domestic and international tourists. Drawing upon quantitative data collected from guests of selected traditional guesthouses in the heritage city of Kashan, Iran, this study employed partial least squares, structural equation modelling, and multi-group analysis to test several research hypotheses. The findings of the study revealed significant differences in the effects of emotional and social values on satisfaction and the direct and indirect effects of social value on domestic and international tourists’ revisit intentions through satisfaction. The results, therefore, emphasised the importance of functional and emotional values for international tourists, with the social value being more important for enhancing the satisfaction and revisit intentions of domestic tourists. Significant theoretical contributions and practical implications are provided in the conclusion section of the study.

Keywords

Perceived value functional value emotional value social value satisfaction revisit intention traditional guesthouses Iran

Introduction

Hotels are impacted by rapid changes in the behaviours, preferences, expectations, and purchase decisions of their guests. Guest satisfaction is a critical measure of a hotel's activities and is viewed as an indicator of good performance in hotel marketing research (Lee et al., 2020). Guest satisfaction is crucial due to its significant effects on market share and profits (Liao et al., 2021). Given its influence on revisit intentions and recommendations, guest satisfaction is key in determining the success of a hotel's marketing strategies (Barthélemy et al., 2021). Consequently, tourism and hospitality scholars have become increasingly interested in the factors that influence guest satisfaction (Kim et al., 2020). Previous studies investigated the effects of hotel attributes, guest beliefs, sociodemographic characteristics, and perceived value (Li et al., 2020; Rasoolimanesh et al., 2016). Perceived value is one of the most frequently studied drivers of satisfaction and revisit intention and enjoys high explanatory power (Rasoolimanesh et al., 2020). Although the importance of perceived value dimensions (namely, functional value, emotional value, and social value) have been discussed frequently in the literature, the difference between their effects on domestic and international guests has received very little attention from researchers.

One important characteristic of hotels is that their guests are often sourced from many different countries. Previous studies showed considerable variation in the drivers of tourist behaviours and satisfaction (Iordanova and Stylidis, 2019; Mechinda et al., 2009). Bonn et al. (2005) compared international and domestic tourists and found major differences in their perceptions. Understanding the differences between the drivers of satisfaction and revisit intention in domestic and international tourists can enable hotels to devise effective strategies based on their target market. Domestic and international tourism play a key role in generating hotel revenue (Mechinda et al., 2009). However, little is known about the impact of value dimensions on domestic and international tourists’ satisfaction and behavioural intentions. Furthermore, available research is limited to small-scale homestays or specialist accommodations like traditional guesthouses. These houses are largely dependent on repeat business and word-of-mouth marketing, so customer satisfaction and revisit intention play a crucial role in their success (Agyeiwaah, 2020). Accordingly, to address the gap in the existing literature, this study aims to examine the differences between the direct impacts of value dimensions on domestic and international guests’ satisfaction and revisit intention. The study also aims to investigate the differences between the indirect effects of value dimensions on domestic and international guests’ revisit intentions through satisfaction.

The findings of this study are expected to enrich the literature on traditional guesthouses by investigating the influences of value dimensions on guest satisfaction and revisit intention. Furthermore, the results are projected to contribute to the existing body of research by demonstrating the differences between the roles of functional value, emotional value, and social value in shaping the guest satisfaction and revisit intentions of domestic and international guests in the relatively overlooked context of small-scale or specialist accommodations. From a practical perspective, understanding the drivers of satisfaction can empower traditional guesthouse managers to effectively implement appropriate tactics to maximise guest satisfaction. The findings of this study are expected to provide useful insights for traditional guesthouse managers seeking to gain a better understanding of the values of both domestic and international tourists. Elucidating these values may help traditional guesthouses tailor their services and products to match the expectations of tourists, which provides a key competitive advantage in a competitive market.

Literature review

Theoretical framework

This study employs the hierarchy of effects model (HEM), originally developed by Lavidge and Steiner (1961) to be used as a predictor of customer behaviour. HEM encompasses cognitive (thinking), affective (feeling), and conative (behavioural) domains (Pérez and Del Bosque, 2015). The cognitive domain describes the customer's values and beliefs, whereas the affective domain describes the customer's sense of affection and emotional responses to a particular product or brand. The behavioural domain is based on the first two domains (Pérez and Del Bosque, 2015). Lavidge and Steiner (1961) originally described the cogitative domain in terms of ‘image advertising’, suggesting that this domain influences the customer's emotions and affections toward a brand based on the mental image the individual has of that brand, with subsequent emotions influencing the customer's behaviour (Pérez and Del Bosque, 2013). More recent studies have described HEM as a ‘cognitive-affective-conative’ model, or as a theory that aims to conceptualise destination or brand image, satisfaction, and customer loyalty (Agapito et al., 2013; Del Bosque and San Martín, 2008). These domains have been described by Agapito et al. (2013: 472) as ‘what one knows and thinks about an object (cognitive), how one feels about it (affective), and how one acts using this information (conative)’. According to the HEM paradigm, perceived value (as articulated in the current study) describes the cognitive domain, satisfaction describes the emotional and affective domain, and revisit intentions mirror the conative domain.

Perceived value

Consumers and marketers have long voiced an interest in clarifying the role of value in the formation of purchase or consumption decisions (Lovelock et al., 2015). Value appears to be a significant factor, capable of providing a competitive advantage in an increasingly fierce marketplace (Lovelock, 2001). The concept of perceived value has its roots in theories of consumer behaviour and represents ‘the consumer's overall assessment of the utility of a product based on perceptions of what is received and what is given’ (Zeithaml, 1988: 14). Perceived value represents the interchange between perceived benefits and perceived costs (Lovelock et al., 2015). Previous studies indicated that perceived value might be a superior predictor of repurchase intentions, surpassing either satisfaction or quality (Zhang et al., 2020). Perceived value precedes satisfaction and the formation of behavioural intentions (Ahn, 2020; Zhang et al., 2020). In recent years, perceived value has been the subject of considerable academic attention due to its ability to predict tourist behaviour (Rasoolimanesh et al., 2020). Previous research has operationalised perceived value as a unidimensional construct (i.e. functional value). Perceived value is, therefore, an independent measurable concept. When viewed as a multidimensional construct, however, perceived value is believed to be comprised of multiple dimensions; each dimension exerts a unique effect depending on the context (Rasoolimanesh et al., 2016). The tourism literature has favoured the multidimensional construct, which is often believed to be better at explaining the behaviour of tourists. Drawing upon the theory of consumption values (Sheth et al., 1991), previous studies of value in tourism have focussed on functional, social, and emotional value dimensions (Jamal et al., 2011; Rasoolimanesh et al., 2016). According to the theory of consumption values, functional value is defined as ‘the utility that is perceived to possess on criteria salient to its physical or functional purposes’ (Sheth et al., 1991: 32). Social value is ‘derived from its association with one or more distinctive social groups’ (Sheth et al., 1991: 38). Emotional value, on the other hand, is ‘derived from feelings or affective states’ (Sheth et al., 1991: 50). In the context of this study, the theory of consumption values is utilised to measure the perceived value of traditional hotel guests, both domestic and international.

Functional value

Functional value refers to ‘the perceived utility acquired from an alternative's capacity for functional, utilitarian or physical performance’ (Jamal et al., 2011: 7). To measure various aspects of functional value, Sánchez et al. (2006) divided the perceived functional value of travel agencies into four dimensions: (a) functional value of agencies (i.e. installations), (b) functional value of contact staff (i.e. professionalism), (c) functional value of tourist packages (i.e. quality of purchased service), and (d) functional value relative to price. Rasoolimanesh et al. (2016) adopted these dimensions of value and measured tourists’ perceived functional value of homestays based on price, host, service, and establishment perspectives. Accordingly, perceived functional value is a second-order construct with four dimensions in this study. The association between functional value, satisfaction, and revisit intention has been confirmed in the service sector (An and Han, 2020; Lee et al., 2011; Rasoolimanesh et al., 2020; Sánchez et al., 2006).

Previous studies have found a significant relationship between country of origin and tourists’ satisfaction level and behaviours (Cheng et al., 2019; Liu et al., 2019). Unlike domestic tourists, international tourists tend to be more culturally and economically diverse (Liu et al., 2019). These differences result in unique perceptions, levels of satisfaction, and tourist behaviours (Liu et al., 2019). As such, if international tourists’ expectations differ from those of domestic tourists regarding the provision of services by hotels and their personnel, international tourists’ ideas of functional perceived value might, accordingly, differ from those of domestic tourists. International guests, who might be accustomed to receiving a higher quality of service from hotels in their home countries, might expect a commiserate level of service at a tourist destination hotel. Therefore, they may be less satisfied and less inclined to develop return intentions compared with domestic tourists whose expectations might be more parochial. In general, the service quality expectations of guests depends on their previous experiences of hotel services, and these prior experiences result in the formation of distinct perceptions of functional value. Furthermore, international and domestic tourists may differ regarding the importance of functional values in shaping satisfaction and revisit intentions, with these differences being the product of different travel motivations and service expectations (Rutty and Scott, 2016). Travel distance and cost might also influence the expectations of tourists. International travel, which involves travelling far distances with quite high travelling costs, can result in greater expectations of service quality. Thus, international tourists tend to have higher expectations. In line with HEM, the difference in perceived functional value leads to different rates of satisfaction and revisit intention. Accordingly, the following hypotheses are developed for this study:

H1. The effect of functional value on satisfaction is significantly different in domestic and international tourists.

H2. The direct effect of functional value on revisit intention is significantly different in domestic and international tourists.

H3. The indirect effect of functional value on revisit intention through satisfaction is significantly different in domestic and international tourists.

Emotional value

Emotional value refers to ‘the utility derived from the feelings or affective states that a product generates’ (Jiang and Kim, 2015: 312). According to a previous study by Rasoolimanesh et al. (2016), emotional value has been measured as a second-order construct with two dimensions (i.e. novelty and hedonism). Tourists’ evaluations of tourism products and services are influenced by emotional drivers (Rousta and Jamshidi, 2020). Emotional value is an important driver of satisfaction and behavioural intention in the context of tourism and leisure (Ladhari et al., 2017). According to Lee et al. (2011), tourist satisfaction and behavioural intentions are not only cognitive but also emotional. Lee et al. (2011) found that emotional value plays a more important role than functional value in shaping tourist satisfaction and behavioural intentions. Several subsequent service studies have confirmed the influence of emotional value on customer satisfaction and behaviour (An and Han, 2020; Rasoolimanesh et al., 2020).

According to Iordanova and Stylidis (2019), country of origin does not only influence tourists’ perceptions in the cognitive domain but also affects them emotionally. International and domestic tourists have different experiences and, therefore, their emotional level is expected to be different. Following HEM, a different emotional level results in a different level of satisfaction and return intentions. Also, familiarity influences individuals’ emotional responses to their experiences. Familiarity with a visited location elicits an emotional response, unlike the cognitive response, which is associated with a visit to an unfamiliar location (Stylidis et al., 2020). This emotional response, in turn, influences the tourists’ behaviour (Mechinda et al., 2009), as well as the degree of attractiveness they attribute to their location (Reid and Reid, 1994). Baloglu (2001) found that the more familiar a tourist with a destination, the more likely he/she cultivates positive images towards the location. Similarly, Stylidis et al. (2020) found a positive association between familiarity, destination image, and loyalty. As domestic tourists are more familiar with the services of traditional hotels in their country, they have different expectations and feelings (compared to international tourists) in response to their experiences of these hotels (Mechinda et al., 2009). Moreover, considering their cultural differences, international tourists might expect their stay at a traditional hotel to be a more attractive and unique experience in comparison with domestic tourists. Accordingly, the following hypotheses are developed:

H4. The effect of emotional value on satisfaction is significantly different in domestic and international tourists.

H5. The direct effect of emotional value on revisit intention is significantly different in domestic and international tourists.

H6. The indirect effect of emotional value on revisit intention through satisfaction is significantly different in domestic and international tourists.

Social value

Another dimension of perceived value that has received considerable attention as of late in hospitality research is social value. Social value is ‘the utility derived from the product's ability to enhance social self-concept’ (Cassia et al., 2015: 250). The perception of social value is derived from the tourist's feeling of being connected to others through their use of a service (Hur et al., 2013). Social value is a salient factor in shaping the travel decisions of tourists (Beall et al., 2020; Moran et al., 2018). The influence of social value on tourists’ behaviours, such as travel intention, revisit intention, and loyalty, has been proven in the literature (Dedeoğlu, 2019; Moran et al., 2018; Rasoolimanesh et al., 2020).

The association between social value, satisfaction, and revisit intention has been demonstrated in the hospitality literature (Dedeoğlu et al., 2016; Rasoolimanesh et al., 2020). As highlighted by Iordanova and Stylidis (2019), the tourist's perceived social value is influenced by the tourist's country of origin. International tourists travel greater distances and often stay for longer periods than domestic tourists (Rutty and Scott, 2016). Moreover, international tourists are more likely to interact and communicate with other tourists, residents, and hotel staff. Consequently, international tourists’ perceptions of social value will differ from those of domestic tourists, who stay for shorter periods. According to Yuksel (2004), travel distance and time lead to behavioural differences between international and domestic visitors. As such, it is expected that the influence of perceived social value on satisfaction and return intentions is different in international and domestic guests. Consequently, the following hypotheses are developed:

H7. The effect of social value on satisfaction is significantly different in domestic and international tourists.

H8. The direct effect of social value on revisit intention is significantly different in domestic and international tourists.

H9. The indirect effect of social value on revisit intention through satisfaction is significantly different in domestic and international tourists.

Satisfaction and revisit intentions

The revisit intention of tourists and guests is an overriding driver of actual revisit behaviour and plays a key role in achieving success in hotels (Xu et al., 2021). Revisit intentions involve a ‘visitor's judgement about the likeliness to revisit the same destination’ (Chen and Tsai, 2007: 9). Previous tourism studies have reported that satisfaction is a key driver of revisit intention (Xu et al., 2021). Tourist satisfaction refers to ‘a positive perception or feeling that tourists develop by engaging in a certain tourism activity’ (Kim & Park, 2017: 178). Previous positive travel experiences result in a positive emotional response (e.g. feelings of happiness), which influences the individual's future revisit intentions (Chen and Tsai, 2007; Lee et al., 2011). Empirical studies (Loi et al., 2017) have reported a significant relationship between tourist or guest satisfaction and intentions to revisit a particular destination in the future.

Kozak (2002) found that the tourists’ country of origin and their degree of satisfaction are positively correlated. The cultural background of tourists has a significant effect on their level of satisfaction and behaviour (Cheng et al., 2019). In addition, distance (or travel time) between the country of origin and destination is another factor that might influence the satisfaction–revisit intention relationship. In effect, tourists are more likely to revisit destinations that are closer to where they live (Iordanova and Stylidis, 2019). Consequently, satisfaction among international tourists may not result in the formation of revisit intentions when the destination is regarded as too distant or costly to revisit. As such, the relationship between tourist satisfaction and revisit intention is influenced by the tourist's cultural background and distance from home. Accordingly, there exist differences between international and domestic tourists regarding the satisfaction effect on revisit intention, thus leading to the following hypothesis:

H10. The effect of satisfaction on revisit intention is significantly different in domestic and international tourists.

Figure 1 shows the proposed conceptual framework of the study. The framework incorporates functional value, emotional value, social value, satisfaction, and revisit intention. The associations between these concepts are compared among domestic and international tourists.

Figure 1.

Conceptual framework.

Methodology

Study area

A quantitative research design has been employed to achieve the research objectives of this study. A survey questionnaire is, therefore, used to collect data from the respondents, i.e. the guests in two traditional guesthouses, including Ehsan Guesthouse (Khoone-e-Ehsan) and Noghli House (Khoone-e-Noghli) in Kashan, Iran. The selected traditional guesthouses are among the most popular hotels in Kashan for domestic and international visitors. Ehsan Guesthouse is Kashan's first historical house converted into a cultural guesthouse, offering visitors an exceptionally convenient environment mixed with traditional values and cultures (irantraditionalhotels.com). The second guesthouse, Noghli House, which dates to the Qajar dynasty (1789–1797) is known for its magnificent sculptures and is one of Kashan's first traditional guesthouses. Both guesthouses are recognised by the Iranian national tourism administration, are listed in the country's National Heritage List (Rasoolimanesh et al., 2019), and are recognised as being among the best traditional lodging choices in Kashan. Kashan is a historic city in the centre of Iran with a complex history dating back to 6000 BCE (UNESCO, 2017). Kashan is home to a rich cultural heritage, including numerous historical buildings. Three sites in Kashan have been added to the UNESCO World Heritage listing (UNESCO, 2017), and Rasoolimanesh et al. (2019) reported that 323 tangible elements and nine intangible assets have been inscribed as World Heritage Sites. Kashan is also home to a unique architectural style that is reminiscent of Iran's ancient customs and traditions. Many of Kashan's historical homes were restored recently; some of them have been converted into traditional hotels and guesthouses, thus offering the tourist a truly unique and culturally enriching experience.

Data collection

In this study, a questionnaire was formulated based on several instruments, which were used in previous studies. Four items are used to measure perceived functional value: establishment (5 items), service (3 items), host provider (4 items), and price (4 items). Two dimensions of perceived emotional value are also measured, including novelty (3 items), hedonic (3 items), and perceived social value (5 items), in keeping with Rasoolimanesh et al. (2016) and Sánchez et al. (2006). Additional items to measure satisfaction (3 items) and revisit intentions (3 items) have been adapted from Chen and Chen (2010) and Chen and Tsai (2007). Participants were asked to specify their level of agreement with question items using a 5-point Likert scale with anchors ranging from 1 (Strongly Disagree) to 5 (Strongly Agree). The questionnaire has been translated into the Persian language (i.e. Farsi), then back-translated into English to confirm the meaning of items used for domestic tourists (Gannon et al., 2019). International tourists completed the English-language version of the questionnaire. The questionnaire has been validated by interviewing five local experts to corroborate the questionnaire constructs and statements. After that, a pilot test has been conducted with 30 international and domestic tourists from one of the selected guesthouses. Moreover, considerable efforts were made to fine-tune the research instrument by removing or rewording several items (refer to Appendix 1 for the adapted items and the mean value of each item).

Data from the selected traditional guesthouses were collected for 12 months (from Sept. 2018 to Sept. 2019) to ensure that high- and low-season guests were surveyed. Guests were informed about the study while checking out of their hotel. Those guests who expressed a willingness to participate were subsequently provided with the questionnaire. Therefore, the sampling method that has been implemented in the study is the convenience sampling method. A total number of 1500 guests from two guesthouses were asked to participate in the study. The questionnaire, however, was administered to 316 guests only. The response rate was 21%, with 169 (53.5%) being domestic tourists, and the remaining 147 (46.5%) being international tourists.

Table 1 shows the profile of the respondents. From a total of 316 respondents, 50.6% were males and 49.4% were females. Moreover, 18.3% of the respondents were between 15 and 25 years old, 38.3% were between 26 and 35 years old, 25% were between 36 and 45 years old, 9.8% were between 46 and 55 years old, and 8.2% were 56 years old or above. Regarding the respondents’ qualifications, the majority (79.1%) have a diploma or an advanced degree. Approximately 53.5% of the survey respondents were domestic tourists, whereas the remaining 46.5% were international tourists. For their visit, 59.8% of the respondents travelled to Kashan to visit the region's historical buildings and heritage, whereas 31.6% travelled to Kashan to spend their vacation in the city.

Table 1.

Profile of respondents.

Characteristics	Frequency	Percentage (%)
Gender
Male	160	50.6
Female	156	49.4
Age (Years)
15–25	59	18.7
26–35	121	38.3
36–45	79	25
46–55	31	9.8
56 and above	26	8.2
Level of Education
Primary school or no formal education	26	8.2
Secondary school	37	11.7
Certificate/Diploma	134	42.4
Degree or higher	116	36.7
Purpose of visit
Visiting friends and relatives	0	0
Visiting historical buildings and heritage	189	59.8
Enjoy beautiful nature	16	5.1
Business/Mission/Work	7	2.2
Education (Conference, School)	0	0
Holiday/Vacation/Leisure	100	31.6
Others	4	1.2

Data analysis

In this study, PLS-SEM and SmartPLS3.2.8 software was used to analyse the data and compare the path coefficients of the two groups using multi-group analysis (MGA) (Ringle et al., 2015). PLS-SEM was also used to assess both the measurement and structural models, with MGA being used to compare the direct and indirect effects of the perceived value dimensions on the satisfaction and revisit intentions of domestic and international tourists. PLS-SEM is a non-parametric form of SEM and, therefore, it is more appropriate when conducting an MGA (Hair et al., 2017; Henseler et al., 2016). Using the measurement invariance for the composite (MICOM) approach, the measurement invariance was evaluated prior to MGA and hypothesis testing (Henseler et al., 2016; Md Noor et al., 2019; Rasoolimanesh et al., 2019). For MGA, two non-parametric approaches were employed, including Henseler's MGA and the permutation test (Rasoolimanesh et al., 2017). The framework of this study includes both formative and reflective constructs, which indicate the preference of application of PLS-SEM (Hair et al., 2017).

Previous studies suggested that a minimum sample size of 100 is required for PLS-SEM analysis (Reinartz et al., 2009). Moreover, G*Power indicated that a minimum of 103 sample size is required to provide a power of 0.80 for analysis (Faul et al., 2009). Therefore, the sample size of each group in this study is considered adequate for performing the analysis.

Results

Assessment of the measurement model

The final framework of this study includes two second-order reflective-formative constructs: functional value and emotional value; and three reflective constructs: social value, satisfaction, and revisit intention. Functional value, as a second-order construct, includes four dimensions, which are reflective constructs: establishment, service, host provider, and price, whereas emotional value comprises novelty and hedonic dimensions. A two-stage approach has been employed to establish the second-order constructs to assess the measurement model of the preliminary framework, which includes nine reflective constructs (Md Noor et al., 2019; Rasoolimanesh et al., 2019). To assess the measurement model of these nine reflective first-order constructs in the first stage (i.e. establishment, service, host provider, price, hedonic, novelty, social value, satisfaction, and revisit intention), their reliability and validity were assessed (Ali et al., 2018; Hair et al., 2017). To establish reliability, the outer loading of the items for each reflective construct should be higher than 0.5, and the composite reliability (CR) and rho-A for constructs should be greater than 0.7 (Ali et al., 2018; Hair et al., 2017). The average variance extracted (AVE) should be higher than 0.5 to establish convergent validity (Ali et al., 2018; Hair et al., 2017). Table 2 illustrates the results for domestic and international tourists. The outer loadings for both groups are greater than 0.5 for all items associated with the constructs. The value of CR and rho-A were found to be higher than 0.7, while AVE was higher than 0.5 for all constructs in the first stage, thus confirming acceptable reliability and convergent validity for the two groups in the study (Hair et al., 2019).

Table 2.

Results of assessment of measurement model for first order constructs.

Construct / Associated items	Outer loading		CR		rho-A		AVE
Construct / Associated items	Domestic	International	Domestic	International	Domestic	International	Domestic	International
Functional value _ Establishment			0.885–0.881		0.856–0.858		0.607–0.598
FE1	0.789	0.877
FE2	0.824	0.784
FE3	0.837	0.776
FE4	0.706	0.674
FE5	0.732	0.741
Functional value _ Service			0.868–0.818		0.794–0.778		0.687–0.602
FS1	0.866	0.875
FS2	0.775	0.775
FS3	0.843	0.663
Functional value _ Host provider			0.876–0.921		0.835–0.891		0.639–0.744
FH1	0.697	0.808
FH2	0.844	0.878
FH3	0.831	0.884
FH4	0.818	0.879
Functional value _ Price			0.890–0.850		0.851–0.774		0.671–0.587
FP1	0.830	0.729
FP2	0.871	0.785
FP3	0.840	0.846
FP4	0.730	0.694
Emotional value _ Novelty			0.915–0.896		0.886–0.833		0.782–0.742
EN1	0.821	0.863
EN2	0.907	0.855
EN3	0.921	0.865
Emotional value _ Hedonic			0.913–0.917		0.858–0.866		0.607–0.787
EH1	0.875	0.874
EH2	0.878	0.907
EH3	0.893	0.880
Social value			0.883–0.913		0.841–0.901		0.603–0.679
SOC1	0.721	0.820
SOC2	0.776	0.803
SOC3	0.824	0.802
SOC4	0.834	0.876
SOC5	0.720	0.817
Satisfaction			0.889–0.931		0.833–0.891		0.729–0.817
SAT1	0.745	0.897
SAT2	0.898	0.910
SAT3	0.909	0.905
Revisit intention			0.947–0.918		0.918–0.867		0.857–0.788
INT1	0.922	0.887
INT2	0.920	0.889
INT3	0.935	0.886

Note: See Appendix 1 for the names of the items.

While it is necessary to establish discriminant validity to confirm the distinction between the constructs in the framework, various criteria can be applied for the assessment (Hair et al., 2019). The literature suggests that the most conservative approach for the assessment of discriminant validity is the heterotrait-monotrait (HTMT) ratio (Henseler et al., 2015). Thus, the HTMT criterion has been applied to assess discriminant validity for domestic and international tourists. Discriminant validity is established after ensuring that the HTMT value for all constructs is less than 0.9 (Henseler et al., 2015). As illustrated in Table 3, the results of discriminant validity assessment showed a proper value of HTMT_.90 for all constructs for both the domestic and international tourists.

Table 3.

Discriminant validity (HTMT_.90 criterion).

Constructs	Establishment	Host provider	Service	Price	Novelty	Hedonic	Social value	Satisfaction
Domestic tourists
Establishment
Host provider	0.832
Service	0.748	0.618
Price	0.794	0.763	0.852
Novelty	0.748	0.678	0.672	0.758
Hedonic	0.456	0.542	0.614	0.698	0.792
Social value	0.542	0.747	0.649	0.751	0.682	0.820
Satisfaction	0.549	0.558	0.727	0.765	0.794	0.862	0.867
Revisit intention	0.641	0.496	0.671	0.640	0.679	0.731	0.602	0.885
Establishment
International tourists
Host provider	0.868
Service	0.824	0.666
Price	0.743	0.651	0.846
Novelty	0.793	0.721	0.645	0.698
Hedonic	0.736	0.688	0.654	0.802	0.893
Social value	0.650	0.612	0.570	0.687	0.873	0.837
Satisfaction	0.785	0.589	0.716	0.744	0.878	0.910	0.735
Revisit intention	0.728	0.563	0.578	0.759	0.786	0.843	0.678	0.883

In the second stage, functional value and emotional value were established as second-order formative constructs using the scores of the associated dimensions from the first stage (Md Noor et al., 2019; Rasoolimanesh et al., 2019). Establishment, service, host provider, and price established functional value, whereas the novelty and hedonic dimensions established the second-order emotional value construct. Therefore, the framework for the second stage of this study includes two second-order formative (i.e. functional and emotional value) and three reflective (i.e. social value, satisfaction, and revisit intention) constructs. To assess the formative constructs, the multicollinearity using variance inflation factor (VIF) and significance of outer weights should be checked (Hair et al., 2017). The VIF should be lower than 5 and the outer weights should be significant to establish an accepted measurement model for formative constructs (Ali et al., 2018). The results of the assessment of the measurement model in the second stage showed that the VIF of items for functional value and emotional value was acceptable for both formative constructs and the two groups of tourists. Moreover, the outer weights for the items of the two formative constructs were significant. Therefore, the results showed that the measurement models for the first and second stages were acceptable.

Moreover, it has been quite essential to establish measurement invariance because of the application of MGA in this study to compare the path coefficients for domestic and international tourists. Henseler et al. (2016) recommended the MICOM approach for PLS-SEM. To do so, however, we need to assess: (a) configural invariance, (b) compositional invariance, and (c) equal means and variances (Md Noor et al., 2019; Rasoolimanesh et al., 2019). Table 4 provides the results of MICOM, which established partial measurement invariance, thus permitting MGA.

Table 4.

Results of invariance measurement testing using permutation.

Constructs	Configural invariance (Same algorithms for both groups)	Compositional invariance (Correlation = 1)		Partial measurement invariance established	Equal mean assessment			Equal variance assessment			Full measurement invariance established
Constructs	Configural invariance (Same algorithms for both groups)	C = 1	Confidence interval (CIs)	Partial measurement invariance established	Differences (Domestic - International)	Confidence interval (CIs)	Equal	Differences	Confidence interval (CIs)	Equal	Full measurement invariance established
Functional value	Yes	0.999	[0.998, 1.000]	Yes	−0.150	[−0.220, 0.226]	Yes	0.395	[−0.448, 0.432]	Yes	Yes
Emotional value	Yes	1.000	[0.999, 1.000]	Yes	−0.029	[−0.221, 0.216]	Yes	0.062	[−0.292, 0.288]	Yes	Yes
Social value	Yes	0.999	[0.997, 1.000]	Yes	0.033	[−0.220, 0.219]	Yes	−0.087	[−0.269, 0.263]	Yes	Yes
Satisfaction	Yes	0.999	[0.999, 1.000]	Yes	−0.195	[−0.221, 0.215]	Yes	0.222	[−0.342, 0.338]	Yes	Yes
Revisit intension	Yes	1.000	[1.000, 1.000]	Yes	−0.166	[−0.221, 0.219]	Yes	0.491	[−0.378, 0.363]	No	No

Assessment of the structural model and hypothesis testing

Table 5 displays the results of MGA and hypothesis testing to compare the direct and indirect effects of functional, emotional, and social values of satisfaction and revisit intentions between domestic and international tourists. We employed two non-parametric approaches to test for multi-group differences and to compare path coefficients between groups: bootstrap-based MGA and the permutation test (Rasoolimanesh et al., 2017).

Table 5.

Results of hypothesis testing.

Hypothesis	Relationships	Path coefficient		Confidence interval (95%) Bias corrected		Path coefficient Difference	P-value difference		Supported
Hypothesis	Relationships	Domestic	International	Domestic	International	Path coefficient Difference	Henseler's MGA	Permutation test	Supported
H1	FV → SAT	0.109	0.224	[−0.020, 0.264]	[0.090, 0.357]	0.115	0.826	0.366	No/No
H2	FV → RINT	0.243	0.133	[0.116, 0.384]	[0.000, 0.278]	0.110	0.176	0.368	No/No
H3	FV → SAT → RINT	0.067	0.105	[−0.011, 0.152]	[0.035, 0.201]	0.037	0.693	0.564	No/No
H4	EV → SAT	0.458	0.673	[0.332, 0.569]	[0.518, 0.821]	0.215*	0.968**	0.067*	Yes/Yes
H5	EV → RINT	0.185	0.244	[0.040, 0.334]	[0.007, 0.487]	0.059	0.637	0.714	No/No
H6	EV → SAT → RINT	0.284	0.314	[0.185, 0.403]	[0.202, 0.461]	0.031	0.619	0.778	No/No
H7	SV → SAT	0.319	−0.015	[0.202, 0.433]	[−0.150, 0.110]	0.334	0.001***	0.002***	Yes/Yes
H8	SV → RINT	−0.195	0.021	[−0.321, −0.071]	[−0.113, 0.163]	0.216	0.979**	0.054*	Yes/Yes
H9	SV → SAT → RINT	0.197	−0.007	[0.118, 0.295]	[−0.077, 0.049]	0.205	0.000***	0.002***	Yes/Yes
H10	SAT → RINT	0.619	0.467	[0.468, 0.749]	[0.288, 0.631]	0.152	0.124	0.284	No/No

Note1: * p < 0.1, ** p < 0.05, ***p < 0.01.

Note2: In Henseler's MGA method, the p value lower than 0.05 or higher than 0.95 indicates at the 5% level significant differences between specific path coefficients between two groups.

Note 3: FV = functional value, EV = emotional value, SV = social value, SAT = satisfaction, and RINT = revisit intention.

Table 5 and Figure 2 validate the results of the assessment of the structural model for both international and domestic tourists. The results revealed insignificant differences between domestic and international tourists for the effect of functional value on satisfaction (H1) and the direct and indirect effects of functional value on revisit intention through satisfaction, respectively (H2 & H3). The results showed that the effects of emotional value on satisfaction differ significantly between domestic and international tourists (H4), with the effect being stronger for international tourists. However, there are no significant differences between the direct and indirect effects of emotional value on revisit intention for domestic or international tourists (H5 & H6). However, the effect is slightly higher for international tourists. Table 5 illustrates significant differences between the effects of social value on satisfaction in domestic and international tourists (H7), which is quite stronger for domestic tourists. The results showed a negative and significant direct effect for social value on revisit intention, whereas the indirect effect of social value on revisit intention through satisfaction is positive and significant, thus indicating a competitive mediation role for satisfaction between social value and the revisit intentions of domestic tourists. The direct and indirect effects of social value on revisit intention for international tourists are insignificant. The differences in these direct and indirect effects for domestic and international tourists are significant. Consequently, the results supported (H8 & H9). The effects of satisfaction on revisit intentions are strong and positive for both domestic and international tourists and, therefore, the difference between the two groups is not significant (H10).

Figure 2.

Results of structural model assessment for international and domestic tourists.

Discussion

This study aims to investigate the effect of perceived value on the behavioural intention of tourists who opt for smaller accommodation providers, such as traditional guesthouses. Drawing upon the HEM, this study investigated the effects of perceived value on satisfaction and revisit intentions among domestic and international tourists in traditional guesthouses. The data analysis showed that functional value had a positive and significant effect on satisfaction and revisit intentions (i.e. directly and indirectly) for international tourists, whereas functional value only had a significant effect on revisit intention for domestic tourists. The results for international tourists are consistent with those of previous studies (Liu et al., 2019). These findings are also consistent with HEM because the international tourists enjoyed the price, establishment, and service quality of traditional guesthouses in Kashan. These traditional guesthouses are established in authentic, historical buildings and, therefore, the sub-dimensions of functional value (e.g. establishment and service) provided tourists with authentic and memorable experiences (Jamal et al., 2011; Sánchez et al., 2006; Sheth et al., 1991), which improved their satisfaction and return intentions.

Moreover, the low cost of staying in traditional guesthouses for an international tourist is an important sub-dimension of functional value. This price differential, compared with a domestic tourist, increased the international tourist's satisfaction and revisit intentions (Jamal et al., 2011; Rasoolimanesh et al., 2016; Sánchez et al., 2006). This is particularly important as the perception of price is an important antecedent to satisfaction. The findings of this study showed that emotional value has a positive effect on the satisfaction of guests in traditional guesthouses in Kashan. Also, the attention to emotional value has a direct effect on the revisit intentions of both domestic and international tourists. These findings are consistent with the premise of the HEM, which indicates that values and beliefs influence behaviour (Lavidge and Steiner, 1961; Pérez and Del Bosque, 2013). The findings are consistent with several previous results (Ladhari et al., 2017; Lee et al., 2011) attesting that emotional value influences how one perceives their experiences, which, in turn, shapes tourists’ satisfaction and revisit intentions. Hotels, which provide what is essentially a hedonic service, are linked to the emotional responses of guests, thereby underscoring the need for accommodation providers to create positive emotional bonds with their guests. Emotional value is a significant driver of hotel guest loyalty, purchasing decisions, and competitive advantage (Dedeoğlu et al., 2016). Hotel guests who feel emotionally connected to a hotel will eventually engage in more word-of-mouth communication and have greater revisit intentions. This finding is supported by Dedeoğlu et al. (2016), who reported that emotional value is the most effective value dimension for the revisit intentions of tourists.

Moreover, the findings for both domestic and international tourists showed that satisfaction plays a significant role in mediating between emotional value and revisit intention, which is consistent with several previous studies (e.g. Gill et al., 2007). The only significant difference between domestic and international tourists in the obtained results is the effect of emotional value on satisfaction. The effect of emotional value on satisfaction and revisit intention, both directly and indirectly through satisfaction, has been stronger for international tourists, which emphasises the importance of this perceived value dimension in increasing the satisfaction and revisit intentions of international tourists. Emotional value includes hedonic and novelty sub-dimensions. The results, therefore, confirmed the importance of hedonic and novel experiences among international tourists (compared to domestic tourists), leading to the perception of greater value and improving satisfaction and revisit intentions.

In contrast to functional and emotional values, the effects of social value on satisfaction and revisit intentions are significant and stronger for domestic tourists compared to international tourists. Social value refers to the guest's interactions with the guesthouse staff and the local community. The results confirmed the value of interactions between the domestic tourists, the guesthouse staff members, and the local community, thus underscoring the importance of the social value dimension of perceived value in enhancing the satisfaction and revisit intentions of domestic tourists. In line with the findings of this study, previous studies emphasised the role of culture and destination familiarity in increasing tourists’ satisfaction, experiences, and revisit intentions (Mechinda et al., 2009; Stylidis et al., 2020). Domestic tourists found it easier to communicate with the residents and enjoyed fluid interactions with the local culture compared to international tourists (Iordanova and Stylidis, 2019; Mechinda et al., 2009). Therefore, the effect of social value on improving the satisfaction and increasing revisit intentions is greater for domestic tourists than international tourists.

Additionally, there was a strong and significant satisfaction effect on the revisit intentions of both domestic and international tourists. Previous studies have found satisfaction to be an important precursor in the formation of revisit intentions (Chen and Chen, 2010; Cheng et al., 2019; Ladhari et al., 2017). Therefore, satisfaction strongly affects both domestic and international tourists. There are also a few discernible differences between these two groups, which are expected in light of the available literature.

Conclusion

Theoretical contributions

This study provides several significant contributions to our understanding of perceived value among tourists and its relationship with satisfaction and future behavioural intentions among domestic and international tourists. Moreover, the findings of this study provided useful insights into the guest evaluation of perceived value, satisfaction, and behavioural intentions in the context of small-scale accommodation establishments, such as traditional guesthouses, which have until now been overlooked in hospitality literature.

While service quality and customer satisfaction have been widely discussed in the literature, few studies have explored the role of multidimensional measures of tourist perceived value. Perceived value constitutes a key strategic variable for the explanation of post-consumption behaviour among tourists, and exploring tourists’ perceptions of value provides a better understanding of how tourism experiences are formulated. This study has shown that incorporating a multidimensional perceived value construct (inclusive of functional, social, and emotional value) with tourist satisfaction and revisit intentions into a single model not only highlights the importance of perceived value but also elucidates a more rigorous understanding of their effects on tourist satisfaction and revisit intentions.

Additionally, this study provides a unique theoretical contribution to the research literature by comparing the effects of the perceived value dimensions on satisfaction and revisit intentions in domestic and international tourists, whereby major differences were found among different dimensions. According to the results, the influence of functional value on satisfaction and revisit intention is not significantly different among international and domestic tourists. Although emotional value is a paramount driver of satisfaction and revisit intentions among international and domestic tourists, its influence on the satisfaction of international tourists is significantly higher than local tourists. Finally, the influence of social value on both satisfaction and revisit intention is significantly different between international and domestic tourists. These findings highlight the importance of investigating the differences between the drivers of international and domestic tourists’ behaviours and decisions.

Practical implications

The findings of the study have several practical implications for traditional guesthouse owners and managers. First, these findings showed that the level of tourist satisfaction is a function of emotional value, particularly as the former relates to repeat business. Because emotional dimensions are often a key source of value derived from the experiences of tourists, guesthouse owners and hotel managers should emphasise emotions and feelings that will create value for customers, such as imparting new knowledge and crafting memorable experiences for tourists. The latter is critical as it influences the future behavioural intentions of tourists. This is particularly important for international visitors given the role of cultural differences, whereby a traditional hotel can provide the international tourist with a unique and authentic experience. Traditional guesthouses can improve the experiences of their guests and gain a competitive advantage in the international market by focussing their products and services on these aspects.

Second, the findings of this study supported the important role of functional perceptions of value in explaining visitor satisfaction and behavioural intentions of international tourists as compared with domestic tourists. This highlighted the need to better understand the expectations of international tourists in service provision, with international tourists, comparing the quality of the services provided against the standards in their country of origin. Understanding the connection between tourist behaviour, consumer culture, and subsequent customisation strategies can effectively guide managers in designing more improved hotel experiences for guests, thus reinforcing their intention to revisit and recommend visiting the place by spreading word-of-mouth.

Finally, the results showed that social value has a greater effect on the behavioural intention of domestic tourists. Given the size of the domestic tourism market in Iran and the seasonality of Iranian tourism, destination marketing organisations and lodging/accommodation providers need to consider this market. Therefore, hotel managers should increase the frequency and quality of their interaction between tourists and the local community by providing packages, which aim at enhancing the guests’ satisfaction and increasing their revisit intention. Iran has recently experienced some advances in information and communication technology, in addition to deepening internet penetration. Taking advantage of these trends, destination marketing organisations and accommodation providers should look forward to generating social media content. The results also revealed that visits to recommended destinations via social media platforms or friends can positively affect tourist satisfaction and destination perceived image. The development of social media content by guesthouse managers should result in positive visitor commentaries, which contributes to shaping the perceived image of future visitors.

Limitations and future research directions

This study had several limitations. First, because data was derived from only two traditional guesthouses in Kashan, Iran, attempts to generalise these findings to other contexts might be challenging. Second, like most previous studies, this study limits the concept of behavioural intentions to favourable viewpoints (e.g. revisiting) to simplify the process of explaining the behavioural intentions of customers. Other behavioural intentions, such as word-of-mouth or intention to recommend, were not investigated in this study. Moreover, the effects of unfavourable behavioural intentions (e.g. intention to complain) or price sensitivity have not been investigated. Therefore, further studies might explore the development of a multidimensional construct, which includes other behavioural intentions as well as unfavourable perspectives.

Like previous studies, this study adopted the social, functional, and emotional dimensions of perceived value. Future research might extend the investigation to develop and validate a measurement scale for perceived valuet that is inclusive of epistemic and conditional value. Further studies might also investigate the integrated framework of influencing factors on satisfaction and revisit intentions in other accommodation establishments, thus expanding the scope of the framework beyond simply traditional guesthouses. For instance, a study comparing small-scale accommodation providers and large-scale hotels might be conducted to provide further invaluable insights into the topic.

Moreover, a cross-national study in which the results are compared between different contexts, which can lead to generalizability, is recommended. Furthermore, individual characteristics (e.g. age, gender, income, and culture) may be critical determinants of tourist associations among perceived value, satisfaction, and revisit intention. Hence, further studies might investigate these determinants as moderating factors.

Footnotes

Acknowledgements

The authors would like to extend their appreciation to the Ministry of Education, Malaysia to fund this paper under the Fundamental Research Grant Scheme (FRGS), 2019 (Grant no. FRGS/1/2019/WAB12/TAYLOR/02/1) that makes this paper possible.

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This work was supported by the Ministry of Higher Education, Malaysia, (grant number FRGS/1/2019/WAB12/TAYLOR/02/1).

ORCID iD

S. Mostafa Rasoolimanesh

Appendix 1. Adapted items to measure constructs with mean value

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