What does the new ‘customer relationship’ mean in the hotel industry?

“Everyone talks about it, nobody really knows how to do it, everyone thinks everyone else is doing it, so everyone claims they are doing it” – David Laniado.

Traecy and Wiersema (1996) introduced the classic three value-disciplines model which explains that companies can choose to excel in either operational excellence, product leadership or customer intimacy (Peelen and Beltman, 2002). It becomes clear that most hotel chains focus on this last value-discipline. But what exactly is it and how can hotels strive to do this? What does ‘the new customer relationship’ mean?

Customer intimacy is about building, as a supplier, a long-term relationship with your customers. Everything is designed around the customer. The individual wishes of the customer count (Peelen and Beltman, 2002). A part of customer intimacy is creating memorable experiences. These experiences need to be unique and personalized. Customers need to know they matter beyond the money they pay for their stay (Ritz-Carlton, 2016).

So how is the hotel performing with this customer intimacy value-discipline? The GI Insight 2013 Customer Intimacy Index gave insight in the performance of the hotel industry in relation to the customer intimacy value discipline. The index approached people from different age-groups in the UK and asked in relation to communication of hotel chains whether they felt “being treated like a total stranger” or “as if they know me like a close friend”. Surprisingly, the outcomes of the research showed that too many people felt being treated like a total stranger.

So how should hotels then build relationships? You don’t want to bother your customers with immense questionnaires which ask too much personal information. At the same time you don’t want to be perceived as creepy when you know too much information they did not give to you personally. In order to create that one specific memorable moment, hotels need to move from thinking of customer service as a transactional activity to a personalized customer service. Without any personal or emotional connection, hotels will never be able to connect with customers (Ritz-Carlton, 2016).

The hotel chain “Ritz-Carlton” and their “Ritz-Carlton Destination Club” is the perfect example of excelling in the customer intimacy value-discipline. This hotel chain really gives customers the feeling that they matter. Ritz-Carlton personalizes services with the help of special employees, which they call Member Experience Concierges (MEC). These concierges design specific member experiences by diving deep into the messages send and received via various channels and seek out the details that will assist them in providing a surprise and “a feeling that I matter” to specific members.

Let’s look at an example of what they are doing so good. Not long ago there was a family that was travelling for the first time to a certain destination. The MEC of Ritz-Carlton hotels exchanged many e-mails with this family by which they learned a lot about them. They found out their son was going to celebrate his birthday at this destination and that his favourite sport was football. Based on this they created a personalized soccer-tournament on this birthday, after which he received the match-ball with many autographs. The smile on his face couldn’t be swept away for the next days. Next to that the MEC found out that his dad made a reservation at a sushi restaurant for that evening. And guess what? The Birthday Boy’s favourite food was sushi. The MEC arranged a special plate for the boy. He was blown away by the surprise, just as the rest of the family (Ritz-Carlton Leadership Centre, 2016).

The MEC of Ritz-Carlton is the example of staff who is responsive to the expressed and unexpressed wishes and needs of guests. It is not enough anymore to only send personalized e-mails or smile to the customer all day. It goes a lot further. We cannot just be interested in the customers anymore. We need to be, so called, “customer obsessed”.


Bibliography

Customerfirst (n.d.), “Van Customer Intimacy naar Customer Obsession in 2016”, Retrieved 13 September, 2016, from http://customerfirst.nl/nieuws/2015/12/van-customer-intimacy-naar-customer-obsessed-in-2016/index.xml

GI Insight, (2013), The 2013 Customer Intimacy Index

Peelen, A., Beltman, R., (2002), Customer Relationship Management

Van Belleghem, S., (2014), “Niet meer kiezen tussen operational excellence en customer intimacy”, Retrieved 13 September, 2016, from http://www.marketingfacts.nl/berichten/niet-meer-kiezen-tussen-operational-excellence-en-customer-intimacy

Wood, A., (2013), “Hoteliers need to do more to develop customer intimacy”, Retrieved 13 September, 2016, from http://www.hotel-industry.co.uk/2013/12/hoteliers-need-to-do-more-to-develop-customer-intimacy/

Ritz-Carlton Leadership Centre (2016), “The value of personalized customer service”, Retrieved 14 September, 2016, from http://ritzcarltonleadershipcenter.com/2016/07/the-value-of-personalized-customer-service/

Ritz-Carlton Leadership Centre (2016), “Creating Magnetic Connections with Customers Without Crossing the Line”, Retrieved 14 September, 2016, from http://ritzcarltonleadershipcenter.com/2016/06/creating-magnetic-connections-with-customers-without-crossing-the-line/

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