CRM: A Hotelier's Guide, part 2 — The expert view

CRM is about curation of the entire customer lifecycle — from her first trip to her last. True CRM includes a plan for every interaction with the traveler, whether the interaction is initiated by the guest — such as a visit to a hotel website, a call to a reservation desk, or the entire in-stay experience — or is the result of outreach by the hotel through email, social media, direct mail or other means. CRM is about intentional communications where the offer reflects customer behavior and expressed needs. It is based upon real-time, dynamic analysis of guest profile information, behavioral situations and market data. CRM is about both automated and human-driven action steps, tactics, and communications.

Why is CRM important for hotels?

Hotels are in the business of taking care of guests, but despite this the industry has always had a “transactional” mindset – treating every booking and stay as if it were the very first. Channel management and optimization have, until recently, been about trying to manage the costs of booking and reducing dependency on third parties. This approach ignores the actual customer — the hotel selection and booking process, the reason for travel, and how the trip is being financed.

While hotels take care of their guests during their stay, they do very little to take care of the relationship with the customer over the long term. There are few differences between the guest experience of the new versus returning guest. Between stays, there is little interaction between hotel and guest and what does take place is often impersonal, untargeted, and ineffective. By contrast, OTAs recognize that attracting and retaining customers is critical to success, so they leverage technology to create aggressive customer relationship management programs over the entire customer lifecycle.

What is the relationship between CRM and direct bookings?

Once a hotel has attracted a new guest, the goal is twofold: secure future stays and influence the choice of booking channel to drive the highest rate at the lowest transaction cost. In general, direct channels deliver the highest yield for repeat bookings and present the most rich opportunities to influence brand perception.

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