Abstract
In spite of the growing importance of product diversification strategy and the existence of varying degrees of product diversity in the US casino industry, research of the effect of product diversification on firm performance has been sparse. By examining the impact of the degree of product diversification on both financial market- and accounting-based firm performance of sampled US casinos and complementarities between products, this study attempts to fill the gap in the hospitality literature. Results of this study show an inverse U-shaped relationship between the degree of product diversification and firm performance and complementarities between gaming business and food and beverage (F&B) business. These findings suggest that US casinos take into account both costs and benefits associated with product diversification, and consider F&B operations more preferentially as a supplementary business when implementing product diversification strategy.
| Original language | English |
|---|---|
| Pages (from-to) | 409-421 |
| Number of pages | 13 |
| Journal | International Journal of Hospitality Management |
| Volume | 30 |
| Issue number | 2 |
| DOIs | |
| Publication status | Published - Jun 2011 |
Bibliographical note
Funding Information:This research was supported by The Institute of Management Research in Seoul National University.
Keywords
- Casino industry
- Complementarity
- Firm performance
- Product diversification