Baltic Journal of Economic Studies 154 Vol. 11 No. 3, 2025 This is an Open Access article, distributed under the terms of the Creative Commons Attribution CC BY 4.0 1 Ivane Javakhishvili Tbilisi State University, Georgia (corresponding author) E-mail: Katsitadze.nana@tsu.ge ORCID: https://orcid.org/0000-0002-7870-1291 2 Ivane Javakhishvili Tbilisi State University, Georgia E-mail: Natalia.kharadze@tsu.ge ORCID: https://orcid.org/0000-0002-5800-0957 3 Ivane Javakhishvili Tbilisi State University, Georgia E-mail: Giorgobiani.maia@tsu.ge ORCID: https://orcid.org/0000-0001-9328-7239 DOI: https://doi.org/10.30525/2256-0742/2025-11-3-154-165 ATTRIBUTE FACTORS INFLUENCING CUSTOMER OVERALL SATISFACTION IN HOTEL SERVICES – EXAMPLE OF GEORGIA Nana Katsitadze1, Natalia Kharadze2, Maia Giorgobiani3 Abstract. The present research focuses on measuring service quality and customer satisfaction in the hotel industry. The aim is to identify overall satisfaction with hotel services in Georgia and the factors influencing it. This issue is of particular pertinence, given its impact on both the image of the country as a tourist destination and the prospects for guests returning from their travels with a sense of satisfaction. This is of particular significance for Georgia, which is currently engaged in efforts to consolidate its position within the global tourism market. The study utilised statistical data from official organisations, as well as ratings reflecting the overall satisfaction of guests surveyed using modern technology on the Booking.com portal. Qualitative factors were grouped into 6-7 sub-components impacting satisfaction, which were formulated by sharing the concept of popular models. The research has utilised the results of a survey of confirmed guests in 137 hotels located in the city of Tbilisi and mountain resorts (8,874 respondents). The results were processed using the SPSS statistical software package. A comparative analysis of hotel cluster groups was conducted, which revealed that local hotel brands have competitive strategies, such as their uniqueness, and different customer attitudes towards quality components of different categories of hotels. This was reflected in the high satisfaction with family hotels in this segment, despite their low ratings in certain (predominantly technical) components of quality. It is noteworthy that interest in mountain resort brands is growing; therefore, family hotels, which make a significant contribution to the sustainable development of regional tourism, require support from the state through different approaches, such as raising knowledge of the area and regulatory incentives. It is evident that the limitations imposed by the research have precluded an assessment of the weighted significance of the impact of the indicators – quality factor groups – on the hotel's rating. This is a subject that requires further study. Keywords: customer satisfaction, service quality, SERVEQUAL, HOLSERV. JEL Classification: L15, L29, M19, Z32 1. Introduction In the contemporary global context, characterised by dynamic processes and systemic changes, issues pertaining to the enhancement of service quality assume even greater significance. These developments encompass the processes of globalisation, internationa- lisation of business, and the escalating competitive environment. The selection of tourist destinations by various markets is increasingly influenced by the quality of tourism services, particularly those provided by hotels. In nations where tourism and the hotel sector represent significant sources of budgetary income, it is imperative to scrutinise the emerging challenges confronting these sectors in maintaining and enhancing service standards (Katsitsdze & Natsvlishvili, The Role of State Regulation and Policy in Tourism Development: The Case of Georgia, 2020). One such country is Georgia, which has successfully developed its tourism sector in recent years. It now aims to attract high-spending international visitors by prioritising the development of high-quality tourism products (Georgian National Tourism Administration&Ministry of Economy and Sustainable Development, 2025). In 2024, the number of international tourist visits was 7,368,149 (+30.3%) (National Statistics Office of Georgia, 2025). In the same year, international travel Baltic Journal of Economic Studies 155 Vol. 11 No. 3, 2025 revenues amounted to 4.4 billion USD, representing a 17.3% increase on the previous year. It is evident that the predominant proportion of international visitor expenditure was allocated to accommodation, constituting 36.4% of the aggregate spending. During the same period, the number of guests accommodated by hotels and hotel-type establishments increased by 1.2% to reach 5.0 million, representing a notable rise in comparison to the previous year (Bochorishvili, Mamrikishvili, & Okropiridze, 2025). A significant proportion of hotel guests in Georgia were international visitors, accounting for 60.2% of the total. The level of satisfaction experienced by international visitors upon their return from travelling in Georgia is notably high. The mean satisfaction score is 4.45 on a 5-point scale (geostat). According to official data, 2,435 economic entities engaged in hotel services were operating in Georgia in 2023. A total of 49 chain-type, individual, and management companies are currently operating within Georgia's hospitality sector, overseeing the management of 13 international and local hotel groups. In this context, 27 companies are representative of international chain hotel brands, while 23 are of local origin (Georgian National Tourism Administration, 2024). With regard to the variety of accommodation options available, the Georgian market is predominantly characterised by small and medium-sized family hotels, which account for a total of 1,275 units. This is followed by hotel companies, which operate 1,218 units, and guest houses, which number 454. As is the case on a global scale, there has been an increase in the demand for alternative accommodation options, such as apartments and hostels. These have competed with traditional hotels in recent years (geostat). The hotel industry, like any other consumer-oriented business, has suffered significant financial losses as a result of the pandemic. Georgia's tourism industry has shown signs of recovery; nevertheless, recent observations indicate the emergence of several notable trends. As of the first quarter of 2025, tourism revenues stood at 826.0 million USD, marking a 2.3% year-on- year increase. Notwithstanding a 17.2% year-on-year decrease, Russia retained its status as the primary source of tourism revenue in Q1 2025, accounting for 17.2% of the total revenue (Bochorishvili, Mamrikishvili, & Okropiridze, 2025). It is important to acknowledge the instability of the aforementioned market, which is attributable to specific circumstances. The present circumstances indicate the imperative for the diversification of the provenance of international tourists. In this particular context, it is incumbent upon the government to implement targeted measures, including the promotion of Georgia as a tourist destination (Katsitsdze & Natsvlishvili, 2020). Notwithstanding the challenges posed by external factors, including the pandemic and regional conflicts, the Georgian hotel market continues to be regarded as attractive by foreign investors (Galt & Taggart). It is evident that both local and international hotel chains are engaged in a concerted effort to extend their operations into the budget sector and regional areas, with a particular emphasis on mountain resorts (geostat). The majority of hotels in the Georgian market, whether they are locally or nationally branded, or unbranded, operate based on self-assigned star ratings. Accordingly, they are not subject to internationally recognised certification systems standards, such as HOTEQ 500 (HOTEQ-500, 2025). It must be outlined that the international standard ISO 9000 (22483:2020, 2020), shaping the grounding principles and phraseology of quality management, is not meant to ensure the delivery of the declared level of quality. This situation poses a significant challenge for local businesses, who must compete with international franchise organisations. Given the aforementioned factors, the country must be sufficiently prepared for the issues associated with tourism development. Taking these steps will ensure that local businesses are well-prepared to compete effectively in the international market while fostering sustainable growth in the sector (Bakhtadze, Aladashvili, Sartania, & Tushishvili, 2024). In light of the aforementioned findings, the objective of the present study was to evaluate the extent to which the Georgian hotel industry is able to satisfy the contemporary demands of consumers. The theoretical and methodological underpinnings of this study are firmly rooted in scientific principles, drawing upon classical and contemporary theoretical and methodological frameworks and concepts pertinent to the formation and evaluation of service quality, including within the hotel industry. The database utilised for this study encompasses data from the Georgian National Tourism Administration and the National Statistics Service, in addition to scientific publications by Georgian and international scholars in the field of the hotel industry. Moreover, the research drew upon data obtained from electronic surveys of verified guests on the Booking portal, thus serving as a reliable secondary source of information (booking.com). The data obtained were processed using the SPSS software package. The following procedures were employed during the analysis: cross-tabulation analysis, correlation analysis and the chi-square test. 2. Literature Review In a highly competitive environment, traditional management approaches and systems can quickly Baltic Journal of Economic Studies 156 Vol. 11 No. 3, 2025 become obsolete. The technologies employed by hotels may also become outdated over time (KINGI, 2015). It is evident that service quality and customer satisfaction are more reliable determinants of successful hotel management. "The evaluation of customer satisfaction is a primary goal for any service firm that would like to survive in this increasingly competitive market." (Wadongo, Odhuno, & Kambona, 2010) Services are defined as the outcome of direct interactions between economic entities, namely, between those who produce and those who consume. As previously stated, customer relationship mana- gement (CRM) represents a foundational element within the service industry, constituting an overarching strategy that aims to obtain, retain, and foster long- term co-operation with customers (Gronroos, 2015). Moreover, it facilitates the organisation's capacity to address issues pertaining to customer loyalty and commitment, in addition to the comprehensive quality of its operations ( Jain, Jain, & Dhar, 2007) The term "satisfied customer" does not refer to satisfaction with the quality of the service process itself. Customer satisfaction is a multifaceted concept, with numerous factors contributing to its formation. A comprehensive understanding of customer satisfaction entails an examination of the emotions and perceptions experienced by the customer during their interaction with the product or service (Oliver, 1999). The discrepancy between the customer's expectations prior to receiving the hotel service and the service that is actually provided is a pivotal factor in determining the level of satisfaction (Bolton & Drew, 1991). It is therefore evident that satisfaction is a subjective concept, which is formed by an individual's internal perception, based on their personal experience of the service received (Kotler & Amstrong, 2018). Although guest satisfaction and service quality are not synonymous concepts, they nevertheless reinforce one another. A substantial body of research has demonstrated that service quality can serve as a significant asset in achieving customer loyalty, enhancing the reputation of hotel companies, reducing operational costs, and optimising business efficiency (Tat Y. & Raymond, 2001). Customer satisfaction is widely regarded as a primary indicator of business performance and the attainment of objectives. Customer relationship management (CRM) has been demonstrated to contribute to the enhancement of operational quality in a variety of ways, including the assurance that companies evaluate the effectiveness of their customer service. In order to achieve this objective, it is incumbent upon hotels to identify the needs of their customers and to plan strategies to meet those needs (Abdullateef, Mokhtar, & Yusof, 2010). Conceptual Foundations of Hotel Service Quality. In addition to its material aspects, the quality of hotel service is also defined by numerous social factors that derive from the unique characteristics of both the guest and the personnel providing the service. Consequently, the evaluation and management of service quality remains a significant challenge for practitioners. As posited by Philip Crosby, a seminal figure in the realm of quality management, the "cost of quality" should not be regarded as an absolute measure of work completed. Rather, it is a tool that highlights areas where corrective actions are necessary to address existing defects. It is also widely acknowledged that he is the originator of the well-known phrase, "Quality is Free", which underscores the concept of a rapid return on investment through quality improvement (Crosby, 1979). Philip Kotler offers a widely accepted definition of quality and provides the following insights in the context of the hotel industry's development (Kotler, Philip; Bowen, John T.; Baloglu, Seyhmus, 2021): • Firstly, it is imperative to establish a clear definition of the term "quality". This is defined as "the features and characteristics of a product or service" that contribute to customer satisfaction. This includes attributes such as the absence of defects or deficiencies. These attributes further enhance the customer's overall experience and perception of satisfaction. • Secondly, the concept of quality can be analysed from both a technical and a functional perspective. The term "technical quality" is employed to denote the tangible elements of the service, which may be considered to include the physical facilities, equipment, and other material resources provided by the hotel. The concept of functional quality is predicated on the manner in which a service or a product is delivered. In this study, Edmundas Jasinskas and his co-authors adopt a similar standpoint to that of Philip Kotler, conceptualising the service process through the prism of two core dimensions: the tangible and the intangible. In their view, when assessing service quality, it is important to distinguish and consider the following factors: the technical element of the service, and the service delivery process, are both of paramount importance. Consequently, the service provided by the hotel's personnel constitutes a functional element of quality assessment, which may include factors such as the staff 's attentiveness to guests, the level of interest and respect shown, a warm and welcoming attitude, and the ability to respond quickly and effectively to force majeure situations, et cetera (Boulding, Kalra, Staelin, & Zeithaml, 1993). The concept of functional service quality, presented by Edmundas Jasinskas and his co-authors, encom- passes both material (technical service) and functional ( Jasinskas, Streimikiene, Svagzdiene, & Simanavicius, 2016) (the process of delivering the product or service) aspects of service quality assessment in the hotel Baltic Journal of Economic Studies 157 Vol. 11 No. 3, 2025 industry – can be further expanded to include social dimensions, such as staff attitudes toward customers and cultural elements (Mattila, 1999). Evaluation Indicators of Hotel Service Quality. The specific characteristics of a service product highlight the importance of research conducted by scholars worldwide, particularly in identifying the key determinants of service quality. J. Flanagan introduced the "critical incident technique" in the last century as a way of assessing service quality by analysing customer satisfaction levels (Flanagan, 1954). Nevertheless, the method has been the subject of criticism on account of its high level of subjective attitude, insofar as it represents merely the user perception and is devoid of a scientific approach to measurement. In the context of evaluating service quality within the hotel industry, the SERVQUAL instrument has been extensively utilised in empirical research as a means of identifying the factors that influence service quality (Parasuraman, Zeithaml, & Berry, A Conceptual Model of Service Quality and Its Implications for Future Research, 1985). As posited by Khutson et al., the quality of service may be subject to variation when a hotel caters to diverse segments, countries, and regions, each exhibiting unique characteristics. An examination was conducted on the utilisation of the SERVQUAL instrument, culminating in the formulation of a novel service quality measurement scale, designated LODGSERV. This scale is predicated on five pivotal dimensions: reliability, assurance, responsiveness, tangibles, and empathy (Knutson, Stevens, & Fumlto, 1990). In the following years, Getty and Thompson developed the LODGING QUALITY INDEX (LQI) (Getty & Thompson, 1994) based on the basic structure of SERVQUAL (Parasuraman, Zeithaml, & Berry, 1988). Min et al. conducted an examination of the extant methodologies employed for the purpose of evaluating service quality within the hotel industry. Utilising the SERVQUAL framework as a foundation for their research endeavours, they have developed a novel scale, designated as HOLSERV. The researchers' findings indicated that service quality is represented by three dimensions: employee behaviour, tangibles, and reliability. In the course of the study, it was determined that factors related to employees were the most significant determiners of overall service quality (Min, 1997). Following a series of adaptations, the SERVQUAL scale was utilised in numerous empirical studies to assess hotel service quality. This scale has since become the most widely employed instrument for measuring hotel service quality and investigating the impact of service quality on customer satisfaction. 3. Methodology The concept of quality has consistently influenced the selection of methods and techniques for evaluating them. Typically, these methods relied on quantitative quality indicators. Using electronic customer survey tools in the hotel industry ensures a significantly larger volume of customer feedback is collected, which can then be processed and analysed to improve service evaluation and enhancement. The rapid development of the Internet and social media has fundamentally transformed the manner in which modern companies conduct business, perform research, manage operations, and control their activities. The manner in which communication and interaction with customers is conducted has undergone significant transformation. In the contem- porary era, the Internet is undergoing a new phase of development, characterised by the sustained growth and evolution of social media platforms. These platforms are utilised by individuals for the purpose of sharing information, ideas, perceptions, experiences, and insights (Belch & Belch, 2020). Having grown up in an environment saturated with information technologies and with the ability to access information almost instantly, the modern generation of consumers is more flexible when it comes to making decisions (Katsitadze, Kharadze, & Pirtskhalaishvili, Baltic Journal of Economic Studies, 2025). Furthermore, the propensity of these customers to rapidly alter their booking decisions engenders a "depth of booking" that is minimal, thereby heightening the risk of attrition and the consequent loss of revenue for hotel companies. It has been determined through consumer content research that the majority of individual consumers turn to Online Travel Agency (OTA) platforms (e.g., Booking. com, Expedia.com, Airbnb, and Tripadvisor) for the purpose of selecting accommodation, with travellers basing their decisions on price and reviews written by others. In this context, hotel ratings have become a significant factor in assessing the quality of a hotel and influencing the buyer's decision. In addition to serving as a mechanism for quality assessment for hotel companies, open-source feedback platforms have also evolved into a tool that influences the opinions of prospective customers and fosters heightened competition within the industry. The study utilised ratings reflecting the overall satisfaction of individual hotels from guests surveyed on the Booking.com portal using modern technology, and quality factors grouped into six to seven subcomponents, which were built by sharing the concepts of popular models (SERVQUAL, LODGSERV, HOLSERV, and (LQI)). As the largest player in the online travel agency (OTA) market, Booking.com is an international travel Baltic Journal of Economic Studies 158 Vol. 11 No. 3, 2025 platform that effectively connects millions of travellers with major global hotel chains and independent hospitality operators of all sizes. Available in 43 languages, the platform features over 28 million accommodation listings, all supported by verified guest feedback. To ensure the relevance and accuracy of the reviews, only those submitted by guests within three months of their departure from the hotel are considered. Guests may submit reviews either digitally or as written comments. Each review includes a rating on a scale from 1 to 10, reflecting the guest’s overall satisfaction with the services and benefits received. The scale is typically labeled as follows: 1 – Bad, 2 – Very Poor, 3 – Poor, 4 – Disappointing, 5 – Satisfactory, 6 – Pleasant, 7 – Good, 8 – Very Good, 9 – Superb, 10 – Exceptional. The rating score is indicative of the overall satisfaction of guests, which is the perception of the overall benefit received from the hotel. The evaluation of the latter is conducted independently of the evaluation subcomponents, and it is not calculated as the arithmetic mean of their sum. The methodology facilitates the ranking of the most significant factors influencing quality assessments, including those that indicate the necessity for investment in modernisation, renovation, or other targeted actions aimed at enhancing the quality of specific aspects of hotel services. A salient feature of this methodology is its capacity for continuous monitoring of changes in the dynamics of quality indicator assessments over time. The objective of the study was to evaluate the degree of guest satisfaction within the Georgian hotel market, with a particular focus on both urban areas, such as Tbilisi, and mountain resorts, including Bakuriani, Borjomi, and Gudauri. The study also sought to identify the factors that influence guest satisfaction and the range of accommodation facilities involved. In order to achieve this objective, evaluations derived from an electronic survey of visitors, conducted via the Booking portal, were utilised. The utilisation of the information provided is substantiated by the inherent nature of the data, as exclusively verified guests are entitled to complete the electronic questionnaire, which is administered through an online programme integrated into the portal. This approach is designed to guarantee the validity of the responses obtained and to facilitate the collection of a substantial number of responses from a diverse sample of respondents. The collection of comparable data via paper-based surveys poses significant challenges for researchers, given the substantial financial and human resources required. A total of 132 hotels participated in the study, with a total of 8,874 guest reviews collected from these hotels, based on data from March 2025. The study focused on the following categories of accommodation facilities for the analysis of guest evaluations collected through electronic questionnaires: City Hotel 5* National Brand (Tbilisi) – 8 hotels; City Hotel 4* National Brand (Tbilisi) – 17 hotels; City Hotel 3* National Brand (Tbilisi) – 11 hotels; City Hotel 5* International Brand (Tbilisi) – 11 hotels; City Hotel 4* International Brand (Tbilisi) – 9 hotels. City Hotel 3* International Brand (Tbilisi) – 6 hotels; Mountain Resort Hotel 5* (Georgian Region) – 10 hotels; Mountain Resort Hotel 4* (Georgian Region) – 13 hotels; Mountain Resort Hotel 3* (Georgian Region) – 11 hotels; Guesthouse (Tbilisi) – 18 hotels; Guesthouse (Georgian Region) – 18 hotels. In order to achieve the objective of the study, it was necessary to utilise exclusively the rating data of guests of the participating hotels that had been posted on the platform. The primary rating score allocated on the platform is that of guests' overall satisfaction, as it demonstrates their evaluation of the discrepancy between the benefits received from the hotel and the value offered. The primary rating score is allocated independently of the sub-components and does not directly reflect the evaluations of specific aspects such as staff, comfort, free Wi-Fi, facilities, value for money, cleanliness, and location. The sub-components mentioned in this study as factors impacting service quality and customer satisfaction express the tendency of the factors grouped in these components to influence specific hotels. This was considered sufficient for the purposes of this study, since its subject was not to identify these factors concerning specific hotels. Moreover, the identical rating system (ranging from 1 to 10 points) was employed for the subcomponents. The rating criteria were grouped as follows: 1.0 to 4.4 points (combined ratings: Bad, Very Poor, Poor, Disappointing); 4.5 to 6.4 points (Satisfactory, Pleasant); 6.5 to 7.4 points (Good); 7.5 to 8.4 points (Very Good); 8.5 to 9.4 points (Super); and 9.5 to 10.0 points (Exceptional). Results of staff evaluation: The highest satisfaction rates with staff (ranging from 9.5 to 10) were recorded among hotels as follows: City Hotel 5* National Brand (Tbilisi) at 75%, followed by City Hotel 4* National Brand (Tbilisi) at 70%, and Mountain Guesthouse (Georgian Region) at 64.3%. The lowest satisfaction rates within this range were observed at the 5* Mountain Resort Hotel (Georgian Region) and the 4* Mountain Resort Hotel (Georgian Region), both of which had a satisfaction rate of 10% (see Chart 1). The satisfaction indicators for comfort, within the 9.5 to 10 range, are as follows: City Hotel 5* National Brand (Tbilisi) shows the highest satisfaction rate at Baltic Journal of Economic Studies 159 Vol. 11 No. 3, 2025 75%, followed by City Hotel 4* National Brand (Tbilisi) at 47.1%. In comparison, the satisfaction index for the same hotels regarding staff was 70%. Hotels categorised as Mountain Resort Hotel 3* (Georgian Region) received no ratings within this comfort range (0%). City Hotel 5* International Brand (Tbilisi) also showed a relatively low satisfaction rate in this component, at 40%, while City Hotel 4* International Brand (Tbilisi) recorded a satisfaction rate of just 9.5%. This lower satisfaction in the comfort component can be attributed to the higher expectations for comfort in international hotels (see Chart 2). High satisfaction with free Wi-Fi, comfort, and staff within the 9.5 to 10 rating range, was distributed as follows: City Hotel 5* National Brand (Tbilisi) led with 50%, followed by Mountain Resort 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0% 90,0% 100,0% . City Hotel 5* International Brand (Tbilisi) City Hotel 5* National Brand (Tbilisi) City Hotel 4* International Brand (Tbilisi) City Hotel 4* National Brand (Tbilisi) City Hotel 3* National and International (Tbilisi) Mountain Resort Hotel 3* (Georgian Region) Guesthouse (Tbilisi) Mountain Resort Hotel 5* (Georgian Region) Mountain Resort Hotel 4* (Georgian Region) Mountain Guesthouse (Georgian Region) 0,0% 0,0% 9,5% 0,0% 0,0% 0,0% 0,0% 0,0% 0,0% 0,0% 80,0% 25,0% 61,9% 29,4% 47,1% 45,5% 41,7% 90,0% 75,0% 35,7% 20,0% 75,0% 28,6% 70,6% 52,9% 54,5% 58,3% 10,0% 25,0% 64,3% Chart 11 Hotel Categories * How would you rate the staff of the hotel? Cross-tabulation 7.5-8.4 8.5-9.4 9.5-10 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0% 90,0% 100,0% . City Hotel 5* International Brand (Tbilisi) City Hotel 5* National Brand (Tbilisi) City Hotel 4* International Brand (Tbilisi) City Hotel 4* National Brand (Tbilisi) City Hotel 3* National and International (Tbilisi) Mountain Resort Hotel 3* (Georgian Region) Guesthouse (Tbilisi) Mountain Resort Hotel 5* (Georgian Region) Mountain Resort Hotel 4* (Georgian Region) Mountain Guesthouse (Georgian Region) 10,0% 0,0% 28,6% 0,0% 35,3% 0,0% 33,3% 0,0% 41,7% 0,0% 50,0% 25,0% 61,9% 52,9% 52,9% 100,0% 33,3% 90,0% 41,7% 78,6% 40,0% 75,0% 9,5% 47,1% 11,8% 0,0% 33,3% 10,0% 16,7% 21,4% CChhaarrtt 22.. Hotel Categories * How would you rate the comfort of the hotel? Cross-tabulation 7.5-8.4 8.5-9.4 9.5-10 Baltic Journal of Economic Studies 160 Vol. 11 No. 3, 2025 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0% 90,0%100,0% . City Hotel 5* International Brand (Tbilisi) City Hotel 5* National Brand (Tbilisi) City Hotel 4* International Brand (Tbilisi) City Hotel 4* National Brand (Tbilisi) City Hotel 3* National and International (Tbilisi) Mountain Resort Hotel 3* (Georgian Region) Guesthouse (Tbilisi) Mountain Resort Hotel 5* (Georgian Region) Mountain Resort Hotel 4* (Georgian Region) Mountain Guesthouse (Georgian Region) 30,0% 0,0% 23,8% 0,0% 0,0% 0,0% 0,0% 30,0% 0,0% 0,0% 60,0% 0,0% 57,1% 5,9% 0,0% 0,0% 8,3% 50,0% 58,3% 7,1% 0,0% 75,0% 9,5% 64,7% 35,3% 72,7% 33,3% 10,0% 41,7% 42,9% 10,0% 25,0% 0,0% 29,4% 64,7% 27,3% 58,3% 10,0% 0,0% 50,0% Chart 3 Hotel Categories * How would you rate the value for money of the hotel? Cross-tabulation 4.5-6.4 6.5-7.4 7.5-8.4 8.5-9.4 9.5-10 Hotel 5 (Georgian Region) with 30%. The "Super" satisfaction range (8.5 to 9.4) also yielded noteworthy results: City Hotel 5* National Brand (Tbilisi) received 70%, and City Hotel 4* National Brand (Tbilisi) received 66.7%. In contrast, the lowest satisfaction rates within the high satisfaction range (9.5–10) were recorded for the following hotel types: Mountain Resort Hotel 3* and 4* (Georgian Region) – 0%; City Hotel 3* (both National and International brands, Tbilisi) – 5.9%; and Mountain Guesthouse (Georgian Region) – 7.9%. It is evident that the diminished satisfaction levels with regard to Wi-Fi service in mountainous regions and lower- category hotels are not attributable to managerial indifference. Instead, they are indicative of a strategic emphasis on optimising customer satisfaction through theprovision of competitive prices while conco- mitantly reducing operational expenses, particularly those associated with technical services. Satisfaction with value for money, within the high rating range (9.5–10), appears particularly favorable across several hotel categories. City Hotel 3* National and International (Tbilisi) recorded a satisfaction rate of 64.7%, followed by Guesthouses in Tbilisi at 58.3%, and Mountain Guesthouses (Georgian Region) at 50%. In contrast, Mountain Resort Hotel 4* (Georgian Region) and City Hotel 4* International Brand (Tbilisi) recorded no ratings in this range. Only 10% of guests rated City Hotel 5* International Brand (Tbilisi) and Mountain Resort Hotel 5* (Georgian Region) as "Exceptional" in terms of value for money (see Chart 3). These indicators highlight the strengths of the budget segment within the hotel market, which are directly reflected in the guests’ overall satisfaction, as expressed in the rating (overall customer satisfaction) scores (see Chart 4). Regarding the question "How would you rate the value for money of the hotel?" for City Hotel International Brands, the data reveal the following distribution: City Hotel 5 International Brand (Tbilisi) received ratings in the 4.5–8.4 range from 90% of respondents, with only 10% assigning the highest score (9.5–10). For City Hotel 4 International Brand (Tbilisi), 89.5% of respondents rated value for money within the 4.5–8.4 range, while no ratings fell into the 9.5–10 category (see Chart 3). The findings of this study indicate that guests perceive international brand hotels to be overpriced in relation to the services provided, as evidenced by the lower value-for-money satisfaction ratings. With regard to cleanliness (ratings of 9.5–10), City Hotel 5* National Brand (Tbilisi) reached a high threshold of 75%, followed by City Hotel 4* National Brand (Tbilisi) at 58.8%. It is worthy of note that budget hotels in this category generally received higher cleanliness assessments than their international brand counterparts. Conversely, guesthouses exhibited the lowest ratings in this category, yet these remained within the "Very Good" range (7.5–8.4%). These outcomes underscore the imperative for enhancement in this component, given the substantial rise in consumer expectations for cleanliness as a pivotal aspect of the hotel product. The location of the hotel received high ratings (9.5–10) across all categories, with over 33% achieving this range. Notably, the highest rating was given to Mountain Guesthouses (Georgian Region) at 64.3%, followed by City Hotel 5* National Brand (Tbilisi) at 62.5% and Mountain Resort Hotel 5* (Georgian Region) at 60%. The robust performance exhibited by mountain hotels in this category can be attributed to the Baltic Journal of Economic Studies 161 Vol. 11 No. 3, 2025 inherent natural appeal and scenic beauty of Georgia's mountainous regions. In a similar vein, the elevated ratings assigned to both international and national 5-star city hotels in Tbilisi are indicative of a deliberateand effective location strategy that has been successfully implemented by these hotel categories. With regard to the question of overall customer satisfaction (as indicated by ratings of 9.5–10), guesthouses in mountain resorts achieved a higher satisfaction rate of 57.1% compared to 4- and 5-star resort hotels in the same regions (see Chart 4). This outcome can be largely attributed to the lower prices offered by guesthouses, as well as the high ratings for staff performance. In such establishments, guests often interact directly with the host, who is an owner and works as a staff member as a rule. This close communication fosters a more private experience, where Georgian hospitality plays a significant role in raising guest satisfaction compared to that in branded hotels, which reflects low professional qualification. It is also important to note that personnel assessment in many mountain hotels is comparatively low, which demonstrates a broader issue related to the availability of highly qualified staff in regional areas. Within the highest satisfaction range (9.5–10), the most favourable ratings were recorded for City Hotel 5* National Brand (Tbilisi) at 62.5% and Mountain Guesthouses (Georgian Region) at 57.1%. The overall satisfaction rate of guesthouses was found to be 57.1%, which is a noteworthy result. In contrast, City Hotel 4 International Brand (Tbilisi), Mountain Resort Hotel 3* and Mountain Resort Hotel 4* (Georgian Region) recorded no ratings in this top satisfaction category (0%). In particular, in mountainous regions, in the context of Georgia, guesthouses compete with Mountain Resort Hotel 3* and Hotel 4* in important components of quality, like staff and comfort. Even guesthouses, which have an overall quality rating of 28.6% in the 9.5–10 range, and 64.3% in the 8.5–9.4 range, while 4-star mountain resort hotels have ratings in the same ranges of 0% and 75% (see Chart 4). Whilst the ratings are, in essence, elevated, they do not engender admiration among guests. There are issues with the Wi-Fi in the mountain guesthouses, but these do not have a significant impact on the overall rating of the establishments. It is evident that a similar predicament would be equally as vexing in the context of a city hotel, given that the demographic of guests patronising Tbilisi hotels is predominantly comprised of business tourists. The results of Facilitise's evaluation are compelling, with National Brand hotels outperforming inter- national branded hotels of the same class in the rankings. In this regard, recent research on Georgian hotels, along with innovations, identifies an environment with Georgian cultural elements (Katsitadze, 2018) as one of the strategic priorities of National Brand hotels, which, unlike the standard environment typical of international brands, is thrilling for guests. The City Hotel 5* (National Brand) has received an average guest rating of 9.5-10 points. A significant proportion of guests, amounting to 60%, have awarded them a "Very Good" rating in this category. However, it is evident that they have not succeeded in impressing their guests. 0,0% 10,0% 20,0% 30,0% 40,0% 50,0% 60,0% 70,0% 80,0% 90,0%100,0% . City Hotel 5* International Brand (Tbilisi) City Hotel 5* National Brand (Tbilisi) City Hotel 4* International Brand (Tbilisi) City Hotel 4* National Brand (Tbilisi) City Hotel 3* National and International (Tbilisi) Mountain Resort Hotel 3* (Georgian Region) Guesthouse (Tbilisi) Mountain Resort Hotel 5* (Georgian Region) Mountain Resort Hotel 4* (Georgian Region) Mountain Guesthouse (Georgian Region) 0,0% 0,0% 4,8% 0,0% 0,0% 0,0% 0,0% 0,0% 0,0% 0,0% 60,0% 0,0% 42,9% 11,8% 23,5% 27,3% 0,0% 40,0% 33,3% 0,0% 20,0% 37,5% 33,3% 58,8% 70,6% 72,7% 66,7% 50,0% 58,3% 42,9% 10,0% 62,5% 0,0% 29,4% 5,9% 0,0% 33,3% 10,0% 0,0% 57,1% Chart 4 Hotel Categories * What is the customer's overall satisfaction? Cross-tabulation 4.5-6.4 6.5-7.4 7.5-8.4 8.5-9.4 9.5-10 Baltic Journal of Economic Studies 162 Vol. 11 No. 3, 2025 The research has determined that, in the category of research objects, the majority of the hotels and hotel- type enterprises operating in the Georgian market today (including both official and unofficial ones, which are presented on the Booking.com website) are not rated 1-4.5 points, but rather are rated in the 4.5-10 range of the rating scale. Of these, the price indicator fell within the range of 4.5-6-4, which demonstrates that consumers believe that prices for guests in Georgia are high, and this is predominantly the case for international 4- and 5-star branded hotels. It is evident that guests have expressed a high level of satisfaction with the quality of Georgian hotel service. This is evidenced by the higher than average satisfaction levels recorded (see Table 1, 2). This can be attributed to guests' dissatisfaction with high prices, particularly for international brand hotels. Table 1 Hotel Categories * What is the customer's overall satisfaction? Cross-tabulation What is the customer's overall satisfaction? Total 4.5– 6.4 6.5– 7.4 7.5– 8.4 8.5– 9.4 9.5– 10 Total Count 1 6 32 68 25 132 % within hotel categories .8% 4.5% 24.2% 51.5% 18.9% 100.0% Table 2 Hotel categories * What is the guest’s overall assessment of the service quality? Cross-tabulation What is the guest's overall assessment of the service quality? Total 7.5–8.4 8.5–9.4 9.5–10 Total Count 13 90 29 132 % within hotel categories 9.8% 68.2% 22.0% 100.0% consistently receive high ratings for their staff (9.5- 10 points, 96%). Therefore, correlation analysis was employed to ascertain the strength of the relationship between the variables. The findings indicate a medium- level correlation between the variables (.584**), as illustrated in Table 4. Identifying the different advantages in various segments has shown that there is no single, universal, strictly defined approach or formula that can guarantee success in providing benefits to hotel guests. Hotel management strategies vary depending on the tourist destination and business model, but one principle remains unchanged: an emphasis on the customer. At this stage, the objective of the research was not to identify the reasons for the low or high importance of a single factor included in the hotel service quality indicators, to implement further management actions for a specific hotel, or to control or reform service delivery procedures. The aforementioned method is achieved through the semantic analysis of the collected information for specific services. This process necessitates the selection of an appropriate methodology, which is then offered to the hotel business, the subject of further research. Table 3 Correlations сhi-square tests Value df Asymptotic significance (2-sided) Pearson chi-square 54.661a 8 .000 Likelihood ratio 59.699 8 .000 Linear-by-linear association 44.658 1 .000 N of valid cases 132 a. 9 cells (60.0%) have expected count less than 5. The minimum expected count is .02. Table 4 Correlations How would you rate the staff of the hotel? What is the customer's overall satisfaction? How would you rate the staff of the hotel? Pearson correlation 1 .584** sig. (2-tailed) .000 N 132 132 What is the customer's overall satisfaction? Pearson correlation .584** 1 sig. (2-tailed) .000 N 132 132 **. Correlation is significant at the 0.01 level (2-tailed). As a result, the first hypothesis is confirmed. Hypothesis 2: The customer's overall satisfaction is significantly influenced by the variable "How would you rate the comfort of the hotel?" The following hypotheses were formulated during the research process: Hypothesis 1: The variable "How would you rate the staff of the hotel?" has a significant influence on the variable "What is the customer's overall satisfaction?" Hypothesis 2: The customer's overall satisfaction is significantly influenced by the variable "How would you rate the comfort of the hotel?" Hypothesis 3: The customer's overall satisfaction is significantly influenced by the variable "How would you rate the value for money of the hotel?" It is important to acknowledge the findings of the chi- square test, which indicate a high statistical correlation between the variables at the 0.01 level (P<0.001) (see Table 3). It is noteworthy that hotels that achieve the highest overall satisfaction level (9.5-10) also Baltic Journal of Economic Studies 163 Vol. 11 No. 3, 2025 Table 5 Chi-square tests Value df Asymptotic significance (2-sided) Pearson chi-square 74.360a 8 .000 Likelihood ratio 66.276 8 .000 Linear-by-linear association 47.132 1 .000 N of valid cases 132 a. 7 cells (46.7%) have expected count less than 5. The minimum expected count is .17. In order to test this hypothesis, the chi-square test and correlation analysis were employed. The findings of the chi-square test demonstrate a highly statistically significant correlation between the variables at the 0.01 level (P<0.001) (see Table 5). It is evident that hotels which have received the highest overall satisfaction ratings (9.5–10) have concurrently achieved elevated scores for comfort (9.5– 10 points, 80%). Furthermore, correlation analysis was conducted in order to assess the strength of the relationship between the variables. The findings indicate a moderate correlation between the variables, with a correlation coefficient of .600 (see Table 6). Table 6 Correlations What is the customer's overall satisfaction? How would you rate the comfort of the hotel? What is the customer's overall satisfaction? Pearson correlation 1 .600** sig. (2-tailed) .000 N 132 132 How would you rate the comfort of the hotel? Pearson correlation .600** 1 sig. (2-tailed) .000 N 132 132 As a result, the second hypothesis is confirmed. Hypothesis 3: The customer's overall satisfaction is significantly influenced by the variable "How would you rate the value for money of the hotel?" In order to test the aforementioned hypothesis, cross-tabulation analysis was employed, incorporating the chi-square test in addition to correlation analysis. The findings of the chi-square test demonstrate a highly statistically significant relationship between the variables at the 0.01 level (P<0.001) (see Table 7). It is evident that hotels which have received the highest overall satisfaction ratings (9.5–10) have also been awarded high ratings for value for money (9.5–10 points, 76%). Moreover, correlation analysis was utilised in order to evaluate the strength of the relationship between the variables. The findings indicate a robust correlation between the variables, with a correlation coefficient of (714) (see Table 8). Table 7 Chi-square tests Value df Asymptotic significance (2-sided) Pearson сhi-square 100.296a 16 .000 Likelihood ratio 99.410 16 .000 Linear-by-linear association 66.871 1 .000 N of valid cases 132 a. 15 cells (60.0%) have expected count less than 5. The minimum expected count is .02. Table 8 Correlations What is the customer's overall satisfaction? How would you rate the value for money of the hotel? What is the customer's overall satisfaction? Pearson Correlation 1 .714** Sig. (2-tailed) .000 N 132 132 How would you rate the value for money of the hotel? Pearson Correlation .714** 1 Sig. (2-tailed) .000 N 132 132 **. Correlation is significant at the 0.01 level (2-tailed). 4. Conclusions The hotel business has been experiencing rapid growth in conjunction with the development of tourism in Georgia, as is evident in the country's related sector. The phenomenon has also been shown to have significant demographic and social implications for the country, as well as considerable economic importance. While the competition has reached a high level, the number of accommodation facilities of various categories is constantly increasing, with new offers emerging. The local hotel industry has entered into a competitive environment with international and luxury hotel brands, which have recently begun to actively evolve in the budget market. In this context, it is evident that non-financial indicators of the hotel, such as service quality, ultimately lead to customer satisfaction and an increase in customer value perception. This represents the optimal solution in a competitive environment. In the scientific community, customer opinion is widely regarded as the most significant indicator in the assessment of service quality. However, the scientifically recognised quality control methods are laborious and expensive, rendering them impractical for comprehensive use, especially for small businesses. Baltic Journal of Economic Studies 164 Vol. 11 No. 3, 2025 In the contemporary era, the advent of modern information technologies has rendered feasible the implementation of novel methodologies for the acquisition of customer ratings on the quality of hotel services, predicated on an electronic collection of data. For this reason, the Booking.com platform was utilised for the study (8,867 guest reviews surveyed in 132 hotels of different categories). The findings of the research indicate that prices in the Georgian hotel market are elevated. A content analysis of the data revealed that prices for services provided by international brand hotels are notably high. In accordance with the initial hypothesis, the guest's perception of the high value of hotel services is influenced by the staff. A content analysis revealed specific segments where this indicator was significantly higher, namely in national hotels and mountain resort guesthouses, which is an indication of customer satisfaction with the social interaction with the staff. The second hypothesis revealed that national brand hotels and mountain resort guesthouses were the most satisfactory. The present study therefore examined the relationship between overall satisfaction and quality-related factors that influence it, as well as the strength of the connection between these factors, accommodation facility types, and hotel categories. This analysis enabled an assessment of tourists' satisfaction with hotel services in specific destinations, namely Tbilisi and the mountain resorts of Georgia. The research has confirmed that international hotels operate at higher prices than domestic hotels, despite having lower ratings in many components than national hotels of the same category. The analysis indicates that the primary consumers of the Georgian hotel market are international guests. These guests utilise strong brand equity; however, they also have fewer satisfied guests, precisely because of high expectations. While guests in Georgian hotels tend to express satisfaction with the staff, certain deficiencies have been identified, particularly in regional hotels. This predicament necessitates governmental intervention to promote awareness within this domain. It is evident that consumers have been the recipients of increased attention, a more affable demeanour, and a greater degree of individuality as a consequence of Georgian hospitality in national accommodation facilities. It is evident that guests generally express satisfaction with Georgian hotel services. This assertion is substantiated by the observation that hotel services constitute a significant proportion of the travel satisfaction indicator in Georgia. A limitation of the study is that the weighted value of each indicator (value for money, quality factor groups: staff, comfort, free Wi-Fi, facilities, cleanliness, and location) was not calculated in the overall assessment for each hotel. This constitutes the subject for future research. References: Jain, R., Jain, S., & Dhar, U. (2007). CUREL: A Scale for Measuring Customer Relationship Management Effectiveness in Service Sector. Journal of Services Research, 1–23. 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