A closer look at defensive strategy

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Source: (Business2community)

Over the years things have changed a lot in the hotel industry. Instead of putting the product in the spotlight, nowadays it is all about the customer. Customer is king! Where it all began with customer relationship management, things moved to the next level : customer engagement management. It is not just ‘a relationship’ anymore, it is all about engaging with your customer. (Peelen & Beltman, 2013) But the question is, how do hotels operate when they eat, sleep and breath around the customer? We are taking a closer look at strategy..

According to the theory of Treacy & Wiersema (1996) we can divide three kinds of strategies. The first one is operational excellence. A hotel that employs this strategy is ahead of its competitors by matching price, quality and the ease of purchase perfect together. The second strategy is called product leadership. Here it all revolves around innovating and renewing products. The last strategy is all about the customer, called customer intimacy. This strategy consists of building up a relationship with your customer and taking all of their individual wishes in mind. (Peelen & Beltman, 2013)

A hotel that chooses for customer intimacy implements a defensive strategy. According to Peelen & Beltman a defensive strategy focuses on maintaining and returning customers. Nowadays hotels are innovating all kinds of aspects to improve the customer satisfaction. This in order to increase the number of repeaters. Looking at some examples will clarify the way hotels are implanting a defensive strategy.

CitizenM is a innovating hotel chain with hotels in, inter alia, Rotterdam, Amsterdam and London. The hotel concept mainly focuses on making it visitors as easy as possible. They maintain a 1 minute check in/out, 24/7 food and drinks and a lobby that feels like coming home. They also have their own community with ‘citizens’. People who become a citizen in their community have different profits. For example, they get discounts and welcome drinks at arrival. The citizen community is a clever way to maintain the current customers. On the other side it can also attract new customers. (CitizenM, 2016)

Another example in the hotel industry is RIU Hotels & Resorts. The well-known hotel chain has several luxury hotels and resorts all over the world. They attend a similar formula where people can join the ‘RIU class programme’. People receive a pass where they immediately get indentified as a regular customer. With the RIU pass people save points on every vacation they go. These points can be hand in for discount on their next vacation. This is also a clever way to maintain your current customers. (RIU Class, 2016)

The conclusion is that customer intimacy as a defensive strategy, can really help hotels to maintain their current customers. The examples have shown us different ways to do this. They do not only stimulate customers to return, but it can also be a very good way to attract new customers. So hotel industry.. keep defending!

Bibliography

Business2community. Strategy. http://www.business2community.com/content-marketing/5-key-elements-successful-content-marketing-strategy-0947654.

CitizenM. (2016). Retrieved September 15, 2016, from https://www.citizenm.com/

Peelen, E., & Beltman, R. (2013). Customer relationship management. Pearson.

RIU Class. (2016). Retrieved September 15, 2016, from RIU Hotels & Resorts: http://www.riu.com/nl/riu-class/index.jsp

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