Wittenborg Associate Professor Publishes Study on Experience Accounting in Hospitality

11.08.2025

Mats Carlbäck’s Research Highlights Benefits of Customer-Driven Financial Strategies for SMEs

How can small and medium-sized enterprises (SMEs) in the hospitality industry optimise the allocation of their resources by leveraging valuable data generated by their customers’ experiences?

This is the question Wittenborg associate professor Mats Carlbäck sought to answer in the paper ‘Experience accounting to improve strategic decision-making in a rural resort: application case report’. The study, coauthored by Ganna Demydyuk, a PhD student at Leiden University, was recently published in the University of South Florida’s Journal of Global Hospitality and Tourism.

The authors highlight that despite possessing vast amounts of potentially valuable data, many SMEs lack the necessary systems and analytical tools to extract practical insights, leaving them at a distinct disadvantage. This issue is further complicated by the fact that many available information systems are ill-suited to the dynamic nature of the hospitality industry.

These challenges have inspired the development of the Experience Accounting (EA) analytical framework, which has been designed and tested in various hospitality businesses. According to Carlbäck, EA aims to optimise decision-making processes for service intensive industries by aligning cost accounting with customer-perceived value. “By strategically allocating limited resources to activities that provide the greatest benefit, that is, those that enhance customer experience and result in a willingness to pay more, companies can optimise and sustain their profitability,” he says.

The study underlines that Experience Accounting introduces a customer-driven approach to financial decision-making. This sets it apart from traditional accounting systems and offers a real-time, forward-looking framework that enables predictive, value-based resource allocation.

“EA allows for the continuous recalibration of financial strategies based on changing customer preferences, which makes it particularly suited for service-intensive hospitality industries. Additionally, it integrates customer satisfaction metrics into financial controls and links customer experience stimuli directly to revenue generation. In doing so, it transforms qualitative service factors into measurable financial drivers,” Carlbäck explains.

The case study analysed in the paper focuses on a rural, upmarket Swedish resort with a strong emphasis on sustainability. Despite its longstanding market presence and positive reputation for ecological practices, the establishment struggled to generate satisfactory returns.

By adopting the Experience Accounting approach, the company’s total cost structure was reorganised based on a new set of factors identified as contributing to customer value. As a result, management gained a clear understanding of expenditures on different aspects of the business.

During the second phase of the process, the resort conducted a customer survey to gain insights into their perceived value across various aspects of single-experience accounts. Customers were asked to assess the actual value they received and their willingness to pay for enhanced performance. They were prompted to differentiate between the value derived from basic food, culinary finesse, service, facilities and ambiance and indicate how much more they were willing to pay for a meal.

The results showed that customers were already satisfied with the resort’s facilities and ambiance, considering them well-aligned with the costs and resources invested. Therefore, further investment in these areas was deemed unlikely to generate additional value or improve profitability.
However, the perceived value of the current service fell short of expectations, with customers indicating a willingness to pay more for higher quality. Based on the obtained data, the resort was able to make decisions that might not have occurred otherwise, such as postponing planned refurbishment investments and allocating more resources to enhance the service aspect.

Carlbäck emphasises that the Experience Accounting framework can be applied across various hospitality sectors, such as urban resorts and chain hotels, by tailoring it to different business models and operational environments. Additionally, its scalability ensures that EA can be adapted for both small and large enterprises, allowing businesses of all sizes to benefit from its implementation. “This approach allows for real-time adjustments and ensures that businesses remain responsive to customer needs and preferences, thus fostering long-term loyalty and profitability,” the associate professor concludes.