Social Media Significantly Influences Online Consumer Purchasing Intention in the Hotel Industry

We live in an era where it’s all about sharing. Whether it’s a picture, a story, an experience or an opinion, everything is posted and thrown into the digital world. Nowadays there are numerous of social media platforms that, let’s be honest, take up a lot of our time. With billions of posts on a daily basis, what does this mean for the hotel industry and its (potential) clients?

Social media has become such an important marketing tool lately that hotel groups have extended their staff with groups of employees whose sole task is to manage the hotel’s social media accounts. This means creating and posting content, replying to comments and increasing the audience by following and interacting with potential clients.

It’s very important that the employee behind the social media account represents the hotel’s image in a correct way, since social media is an engaging platform and could easily change the attitude consumers have towards the brand (Peelen & Beltman, 2013). Friendly replies and the ability to handle a joke usually do the trick and make people grow more fond of your brand. The use of humour however might be tricky as there is a fine line between a joke and an insult, as you can see in the example below.

Retrieved from TheJournal.ie (The Journal, 2015)

Retrieved from TheJournal.ie (The Journal, 2015)

This post had been shared a lot and created a lot of controversy. While many people loved the hotel for its response, others thought they took it too far (The Journal, 2015). A person that laughed at the response will have a positive attitude towards the hotel and might be more inclined to book with them, whereas a person that thought the hotel took it too far has most probably been put off and does not want to be associated with the brand in any way.

While what is mentioned above is something that the organisation can control, there is of course also a lot of content out there that the hotel group does not have any influence on. How many times have you scrolled down your timeline only to stumble upon a bunch of holiday pictures from your friend, turning you extremely jealous, making you wish you were there? This is called user-generated content (Peelen & Beltman, 2013) and can be extremely helpful for hotels. Through social media and with the help of pictures, reviews and experiences, consumers might be able to convince potential clients to book with the hotel. It is therefore also no surprise that social media is often the place where the purchasing process begins (Peelen & Beltman, 2013). A customer sees or reads something and starts dreaming about their next holiday, preferably at your hotel.

With this said, it is important to mention that we should not underestimate the influence social media has on consumer behaviour. One mistake and it’s only a matter of time before the whole world knows about it. But to end on a more positive note, this of course also works the other way around: one perfect response and you will be loved by many!

References

Peelen, E., & Beltman, R. (2013). Customer Relationship Management. Pearson.

The Journal. (2015, February 26). Dublin hotel tells Ed Sheeran fans to stay in homeless shelters if not happy with its price. Retrieved from The Journal: http://www.thejournal.ie/dublin-hotel-homeless-shelter-1962021-Feb2015/

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The Effect of Loyalty Programmes on Marketing Campaigns

As explained in a previous blog (The Road to Loyalty) it is essential for businesses to have loyal customers. One of the tricks used to gain these customers is to offer loyalty programmes where the hotel offers the customer all sorts of benefits in order to gain their loyalty in return. With many different visitors staying at a hotel the question remains: who is worth targeting?

When it comes to hotels business travellers can be seen as the target group that is most interested in a loyalty programme. This is because they are returning visitors and are most likely to stick to a certain hotel chain as they are familiar with its products and services. 65% of business travellers are already part of a hotel loyalty programme (Hoang, 2014).

While not all business travellers are worth targeting and not all the customers that are part of a loyalty programme are as loyal as you would want them to be, one should find a way to find out which customers are of most value to the company. To market to your most loyal customers in an effective way, the RFM model can be used. It helps to analyse purchase behaviour by recency, frequency and monetary value to determine what kind of offers work for what type of customers (Statical Concepts, n.d.). This way one can ensure to target the right set of customers who are most likely to respond to your marketing campaign. It makes sense that based on RFM the set of customers that are worth targeting will mostly be business travellers.

RFM can be a helpful tool if you wish to keep your customers in or to move them up on the customer pyramid. This approach makes sense for a hotel group as it’s much more beneficial for them to try to keep the customers than to constantly try to gain new ones. Once customers are part of a loyalty programme, hotels will have an insight into who their guests are, what they like, and where they are from (McEvilly, 2015). In terms of marketing this saves a lot of money. The customers are in and their wishes, needs and behaviour are known.

While RFM shows you which customers are of most value to your company, one should keep in mind not to overflow them with information and offers as this can put even a loyal customer off. Of course, the RFM model will also show you a set of customers that have the potential to become one of your most loyal guests, but aren’t quite there yet. Personalised marketing campaigns based on the information that is available can help to give these customers the final push. After all, customer retention is key in order for a hotel to be successful.

References

Hoang, A. (2014). Understanding the Difference Between Business and Leisure Travellers. Retrieved from E-Marketing Associates: http://www.e-marketingassociates.com/understanding-differences-business-vs-leisure-travelers/

McEvilly, B. (2015, June 9). Why Loyalty Programmes are Good for Hotels. Retrieved from HospitalityNet: http://www.hospitalitynet.org/news/4070567.html

Statical Concepts. (n.d.). Recency Frequency Monetary Modeling (RFM). Retrieved from Statical Concepts and Analytics Explained: http://statisticalconcepts.blogspot.nl/2010/03/recency-frequency-monetary-modeling-rfm.html

Steps to Customer Journey Mapping

To deliver the best service possible it is essential to analyse every step of the customer experience. A customer journey mapping strategy enables hotels to identify the desires and expectations of each guest and provide appropriate services at each touchpoint during their stay. It is about knowing what happens to the hotel guest, how it makes them feel and how to react (Dent, n.d.).

The first step to customer journey mapping is to identify customer personas. What kind of guests stay at the hotel and what value do they bring? This could be for example families, business travellers or couples. Consequently, the customer journey map won’t be the same for each of these type of guests due to different touchpoints of interest (Dent, n.d.).

The second step is to identify the steps in the journey of the different personas. These steps will reveal the touchpoints effecting the customer experience as well as their relative importance. The image below shows the customer journey map of hotel guests.

Retrieved from CMSWire.com (Abraham, 2013)

Now these steps have been identified it is important to put yourself in a customers’ shoes. For example, during check-in a business traveller might wonder what the WiFi password is, so he can check his emails. The hotel should react to this by providing the password during check-in. The business traveller should not have to ask for this information.

The next step is to determine the customers’ value. How can each segment add value to the hotel group? Research has shown that business travellers make more loyal guests than leisure travellers. 65% of business travellers are part of a hotel loyalty programme and therefore add more value to the hotel than leisure travellers that are proved to be more price sensitive (Hoang, 2014). Other ways to add value could be the likelihood to recommend or driving additional revenue by purchasing extra services, such as a room service (Dent, n.d.).

Furthermore, the customer experience should be consistent through all channels used by the hotel group (Dent, n.d.). This means for example that the mobile version of the hotel’s website should be as user-friendly as the desktop version.

If done properly, customer journey mapping can help a hotel group to determine which touchpoints are the most important from a customers’ point of view. It will show what is going well, where improvements are needed and where to invest in solutions to enhance the customer experience, increase revenue and grow brand loyalty (Dent, n.d.). After all, a happy customer is a happy company.

References

Abraham, J. (2013). Journey Mapping Helps Organize Around Your Customers. Retrieved from CMSWire: http://www.cmswire.com/cms/customer-experience/journey-mapping-helps-organize-around-your-customers-020795.php

Dent, J. (n.d.). Customer Journey Mapping: A Walk in Customers’ Shoes. Ascend.

Hoang, A. (2014). Understanding the Difference Between Business and Leisure Travellers. Retrieved from E-Marketing Associates: http://www.e-marketingassociates.com/understanding-differences-business-vs-leisure-travelers/

The Road to Loyalty

Many businesses strive for loyal customers, but what exactly is this? What is important when it comes to loyalty? According to Peelen & Beltman (2013) loyalty is “a deeply held commitment to rebuy or repatronise a preferred product/service consistently in the future, thereby causing repetitive same brand or same brand-set purchasing, despite situational influences and marketing efforts having the potential to cause switching behaviour.” In the hotel industry this means: to make sure customers rebook at the same hotel chain at the same or a different destination.

Loyalty can be created by earning the customer’s trust. When there is trust in a relationship, customers are willing to take more risks. Their feelings of insecurity and doubt are gone. At the same time trust can lead to a higher level of commitment in the relationship.
Commitment can be defined as “an enduring desire to maintain a valued relationship”. Additionally, there are three levels of commitment: structural, moral and personal (Peelen & Beltman, 2013). Looking from the perspective of a luxury hotel group personal commitment is where the aim should be. Personal commitment can be defined as “the desire someone displays to continue a relationship.” The relationship is felt internally and originates from a personal choice (Peelen & Beltman, 2013).

Customers should book the hotel because they enjoy staying there, not because they feel like they have to. However, one can play around a little bit with this. Many hotels nowadays offer loyalty programmes as an attempt to get customers to rebook with them over and over again, because it will give them certain benefits in return. A good example of one of these loyalty programmes is the Starwood Preferred Guest programme by Starwood hotels. Benefits of this programme are:

  1. Access to a wide variety of Starwood hotels
  2. Earn Starpoints that can be used
    1. For a free stay or an upgrade
    2. For redeeming frequent flier miles on over 30 participating airlines
    3. To go to music, sport, or cultural events
    4. To give it to charity
  3. Use of SPG app, which can be used to enter your room (no key necessary), to check your starpoints balance and to check upcoming stay details and elite status.
  4. Around the clock assistance by the SPG team

(Starwood Hotels, 2015)

Another essential aspect to gain loyalty is frequent communication on various communication channels. Four Seasons for example has introduced Fan Fridays on Facebook as a tribute to their customers. Customers can send in their photos every week of which the best one will be chosen and posted onto the Four Seasons Facebook account (Four Seasons Hotel & Resorts, 2015). While there is no actual price involved, customers still feel appreciated and recognised.

In addition, personal contact is very important when building commitment. One should make sure that it’s easy for customers to be helped, through both a real person and technology. They will be more committed to a company if they feel they are getting the attention they want and need.

In short, one can say customers are more likely to become loyal when there is understanding, benefits, efficiency and proper communication. Piece of cake, right…?

References

Four Seasons Hotel & Resorts. (2015). Four Seasons Hotels & Resorts. Retrieved from Facebook: https://www.facebook.com/FourSeasons

Peelen, E., & Beltman, R. (2013). Customer Relationship Management. Pearson.

Starwood Hotels. (2015). Preferred Guest Programme. Retrieved from Starwood Hotels: http://www.starwoodhotels.com/preferredguest/index.html

Engaging Your Customer Like a Hilton

In a modern, globalised world with fierce competition, it is very important for a business to engage with its customers in order to turn them into loyal customers. There are several arenas to engage in with your customers. One of them is for example, through digital channels (Peelen & Beltman, 2013). Imagine you’re going to London and need a place to stay. You go to Booking.com and there they are: hundreds of accommodation providers trying to convince you that their product offers the best value. There is so much, maybe even too much, to choose from, so it is essential for a business to differentiate itself in order to stand out from the competition. Within the hotel industry you often only get one chance to prove yourself and to build a (long-lasting) relationship from there. You want your guests to come back, to stick to your hotel group regardless of the destination they are going to and you want them to recommend and convince others to stay at your hotel as well. So, what is a good practice to do this?

When looking at Hilton for example, the first thing you notice when clicking on their website is that it asks you to select a language. There are over 20 languages to choose from, making the product very accessible. The website also changes when selecting different languages based on where each market segment is most likely to go to (Hilton Hotels & Resorts, 2015). Information is relevant and for the customer therefore, maybe also more personal.

Furthermore, Hilton makes use of the omni channelling technique where multiple channels can be used in order to connect with the organisation (Raconteur, 2014). Bookings can be made online, through the mobile app, but also by telephone. Different phone numbers are provided based on what a person is inquiring about, saving both the customer and organisation time. Contact by email is possible too, but phone numbers seem to stand out on the contact page of the website. This makes sense, because a phone call is more personal, direct and efficient (Hilton Hotels & Resorts, 2015). Customers can be helped much quicker, improving the customer experience.
On social media, Hilton is also available and addressable. Negative comments for example are tackled with a quick and friendly response, offering solutions for customer’s products if possible (Facebook, 2015). Understanding your customer at all times is key.

Another great asset from Hilton, if not the best in regards to customer loyalty, is the Hilton Honours programme. This is a programme allowing customers to save points when booking a hotel or making use of transport and other services/partners that are affiliated with Hilton. The saved points can be redeemed to get discounts on your next stay with Hilton, transport services, shopping, one-of-a-kind experiences and much more (Hilton, 2015). This is of course a clever trick to increase your customers loyalty.
A sense of the so-called calculative commitment has been created, which can be important in a relationship (Peelen & Beltman, 2013). If the customer were to book with a different hotel chain next time, the earned points would go to waste. And what about FOMO (fear of missing out) on those cool one-of-a-kind experiences? No one wants that – better book with Hilton again!
Of course, there is also a sense of affective commitment here as the programme makes you feel appreciated and welcome. As quoted on their Facebook page: ‘the more you stay, the more you get’. And don’t we all want more?

In short, by offering personalised information and contact, multiple communication channels to choose from, and a special honours programme, Hilton has been able to add extra value to their product in the eyes of their customers. Consequently, the customers add value in the form of (extra) purchases and recommendations.

References

Facebook. (2015). Hilton Hotels & Resorts. Retrieved from Facebook: https://www.facebook.com/Hiltonhotelsuk?brand_redir=125762892900

Hilton. (2015). Retrieved from Hilton HHonors: http://hhonors3.hilton.com/en/index.html

Hilton Hotels & Resorts. (2015). Customer Support. Retrieved from Hilton Hotels & Resorts: http://www.hilton.com/en/hi/customersupport/index.jhtml?xch=1666021316,wq7DV6gWQ8NVk1qMwvHzyCW8yGlGphHTBZ3vyx6zy8hhd4wlbs3K!893407656!1442488374964&cid=OM,HH,RedesignV1A7,Footer

Hilton Hotels & Resorts. (2015). Home. Retrieved from Hilton Hotels & Resorts: http://www3.hilton.com/en/index.html?ignoreGateway=true

Peelen, E., & Beltman, R. (2013). Customer Relationship Management (second edition). Amsterdam: Pearson Education Benelux BV.

Raconteur. (2014). Customer Experience and Loyalty. Retrieved from Customer Experience and Loyalty: http://np.netpublicator.com/netpublication/n54494776