Personalization. Some hoteliers might roll their eyes at the term – and with good reason.
NB: This is an article from Roomdex, one of our Expert Partners
The industry loves to talk about it, but it has been very hard to achieve. Why? It is really a 2-part problem. First, you need to know what the guest will want, and second, you need to have the operational bandwidth to deliver it.
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Historically, real personalization has only happened at the most luxury hotels who deal with repeat VIP guests.
Can new technology really deliver what was once considered only obtainable and deliverable by luxury hotels? If you take a closer look at ABS, the answer is, “Yes.” Attribute-based Selling (ABS) is positioned as a way to sell hotel rooms differently. But what it really does is provide a vehicle for hotel stay personalization – and the benefits for hoteliers are significant.
Is personalization really possible for most of the hotel industry?
For luxury hotels, one distinguishable feature that has set them apart from their peers is the level of personalization and customization they offer their guests.
Luxury hotels use two techniques to deliver personalization. The first is simply the effort to accommodate guest requests through extreme flexibility. Raffles Singapore, famous for their butlers, offers guests a “Pillow Menu.” So, now you can sleep on just the right pillow for you. Instant “personalization.”
The second technique is the collection and recording of meticulous stay records that are referenced to prepare for returning VIP guests. If a certain guest requested extra towels every time they stayed in the past, the hotel may provide them even before they are requested on the next stay.
Why can’t I get the same level of personalization at a small boutique hotel in Washington, DC as I do at Raffles? Most likely, the boutique hotel doesn’t enjoy the percentage of repeat customers that Raffles does. And then, there is probably not enough personnel on staff to record, review and act upon each stay record.
Okay then, why can’t I get the same level of personalization at the Poughkeepsie Courtyard Marriott as I do at Raffles? Marriott certainly has the ability to record guest requests. The answer could be that they think they don’t have the variability in product (e.g., no pillow menu!), and they don’t have enough staff to deliver the service variations.
The barrier to hotel stay personalization always comes down to two problems: Labor (collecting and acting upon requests) and Product (having enough stay product variation to provide a “personalized” experience). This is why hotel automation software that uses ABS is so important to delivering the best experience to your guests. ABS instantly gives you the means to create a “new” product array and it provides the means to collect and act upon guest request – with no staff labor required. ABS delivers the same type of guest personalization for your hotel that has previously only been reserved for the top luxury hotels. How? Let’s look into how ABS works in practice.
Understanding Attribute-Based Selling (ABS)
At its core, ABS is a way of unbundling hotels services and room product into smaller units, allowing hotels to sell every room feature independently of one another, each one with their own inventories – and optional costs (If you are a luxury hotel, don’t focus on the “selling” part. Prices can always be set to zero, or “Yes!”).
Instead of the traditional method of offering rooms by room type, a hotel separates out its room inventory and allows guests to pick and choose the features they most value through a self-service mobile (or desktop) interface. So instead of buying a Junior Suite, the consumer can choose a stunning view, a larger room, a higher floor level, a Jacuzzi, a Balcony, a Park View etc.
Immediately the first problem of hotel personalization is solved. If you can’t personalize a stay experience for your guest because A) you don’t know the guest, or B) you don’t have the staff to ask them, then ABS is your answer. It provides the automated interface for guests to tell you what they want. And with deep, 2-way integration into the PMS, there is no labor required to make record of it.
“But we have no Pillow Menu,” you say. Do not fear. ABS is a room-level merchandising product. Hidden in your room type bundles are not only features that individual guests may have a strong love for (e.g., the balcony, the sitting area, the jacuzzi, the fireplace, the kitchenette, etc.), but also features that guests commonly request (e.g. a room on a high floor, a room with a particular view, a room away from the elevator). These attributes are also room products that have value to your consumers. While ABS WILL entice your guests to move up to a room that meets their desires, it also derives revenue from (and can guarantee) these special “upgrades” within the guest’s reserved room type.
ABS is a revelation because it solves both the Labor and the Product problems that come with hotel stay personalization. And it can be used in reservation acquisition or in post-reservation upselling (or “request guaranteeing,” if you don’t want to charge a price.).
ABS for guest satisfaction
A study by Cornell University found that for every point increase in guest satisfaction score (measured on a scale from 0-100), there was an estimated increase in revenue of $10 million per year. When guests are satisfied, they tend to be more loyal and not only are they more likely to return but also recommend it to others. Clearly, being able to give your guests what they want, will increase their overall satisfaction. And of course, what do customer want now more than ever? Control. They want personalization, and the ability to customize.
Guest expectations are evolving, and the hotel of tomorrow needs to be prepared to meet them,
said Mike Chuma, Vice President, Marketing & Enablement and Engagement, IDeaS. The growing challenge facing the industry, on both sides of the front desk, is the lack of control guests have over many aspects of the hotel experience. ABS is the solution to this problem and the future of hotel booking. By embracing a booking strategy that offers room prices based on individual elements, guests are offered freedom of choice and hotels are awarded higher revenue.
The future of personalization involves ABS
The calculus is very straight-forward.
- Today’s consumers have an expectation of the ability to personalize products and services through a digital interface. So that means “personalization” is no longer an abstract requirement for most hoteliers.
- Hoteliers that don’t run a business model that supports niceties like a “Pillow Menu” will have to figure out how to transform their current property investment into a flexible product offering. No, just offering breakfast isn’t going to cut it.
- Current labor availability and costs make it a challenge for any hotel to execute on personalization data gathering and service execution, so automation tools are the only way out.
- The answer is Attribute-based Selling. ABS provides hotels of any type the means to provide a personalization program. It helps you unbundle your room product into new, merchandisable pieces that can either add new revenue or fulfill VIP/Loyalty rewards. ABS collects direct and proven guests interests and desires, guarantees their fulfillment, and writes it all to the PMS without the hotel manager having to find someone on staff to do it.
And it works for the hotel business owner as well. All customers currently using the ROOMDEX ABS solution have positive results. Initial figures revealed the number of upsell purchases increased by 36%. 55% of guests upgraded to a higher room category via ABS; 32% of all ABS upsell revenue was directly attributed from upsells within the same room category, and 45% of all guests purchased two or more features or room attributes via ABS. It drives ADR and RevPAR.
Plus, you can set the whole program up in an afternoon! ABS is one technology that enhances both guest experience and revenue. That is real ROI.
