The importance of psychical arenas in the hotel industry

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Source: (Acuantcorp, sd).

The number of channels is fast growing through the rise of the internet. Nowadays a company can communicate to the customers on every level (Peelen & Beltman, 2013). Is the psychical arena still important in the hotel industry?

The importance of a product or service depends on the importance it gives to the customer and also the number of substitutes. There are two types of personal sales to divide: transactional sales and the ‘complex sale’ (Peelen & Beltman, 2013). The hotel industry offers consultative sales, these are sales within the ‘complex sale’ that is more than just buying the product, the customers need consulting with this kind of service. Buying hotel rooms is important for the customers but there are many substitutes.

Although the sales is not the most important part of the psychical arena in the hotel industry, the actual experience is. Guests come to a hotel, they are going to check in and there is the first need of the psychical arena. The guests need a little of explanation and the hotel room key. The employees can make the stay much more pleasant. The psychical arena is important in the hotel industry to retain guests and make the guests loyal. The most critical aspect that can influence that, is the psychical arena because this is where the experience happens (Peelen & Beltman, 2013).

The 41 hotel is in the top of the TripAdvisor hotels and the general manager explains some aspects they focus on to be on the top and it definitely includes the psychical arena. The first psychical contact starts at the arrival, the employees have to make sure that the welcome is warm and the check-in goes smooth (Hendry, 2013). The way the employees interact with the guests during their stay is very important. Hendry mentioned that the relationship has to be warm and personal. The employees try to anticipate on the guest’s needs, this requires also psychical contact. The employees are aware of personal celebrations so they can do something special for the guest (Hendry, 2013). The last physical contact is at the check-out, so make it a good one!

Hospitality – ‘‘The friendly and generous reception and entertainment of guests, visitors, or strangers.’’, from the Oxford Dictionary (Wang, 2014). Wang says that the hotel experience needs to be created online but also definitely offline.

Although almost everything in the travel industry is becoming online, the hotel experience cannot be a perfect hotel experience without the psychical contact. The orientate process and the after sales can easily be done online but the actual experience in a hotel must be offline. The personal contact between the employees and guests is important for the relationship and an aspect for guests to return to a hotel.

Bibliography

Acuantcorp. (n.d.). couple hotel check in. Retrieved from acuantcorp: http://www.acuantcorp.com/wp-content/uploads/2016/08/couple-hotel-check-in-484378693-small.jpg

Hendry, M. (2013). When guests stay at a hotel what makes for the perfect experience? Retrieved from blog.redcarnationhotels: http://blog.redcarnationhotels.com/we-care/the-secret-of-creating-the-perfect-hotel-experience

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

Wang, W. (2014). The perfect hotel experience: Here’s all you need to know. Retrieved from appnova: http://www.appnova.com/perfect-hotel-experience-heres-need-know/

Creating profit from segmentation and selection

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Source: (Itracmarketer, 2016)

Segmentation is the subdivision of a market into discrete customer groups (Company, 2015). The customers in the same group will react the same way to marketing stimuli and they have the same buying behaviour. Segmentation is used for customers to become more satisfied and loyal to spend more. Not all companies use segmentation in the right way because the customers insights are lacking (Peelen & Beltman, 2013).

For dividing the customers, you can use segmentation criteria. Kotlet and Keller use geographical characteristics, demographic characteristics, socioeconomic data, behaviour, psychographic characteristics or buying motives to divide the customers. There is a guideline for good segmentation solutions, the segmentation has to be measurable, substantial, accessible, differentiable and actionable. It is important to do qualitative research for more insights and make a persona of each segmentation group after. The persona is important because marketers and other employees can see the world through the eyes of the customer (Peelen & Beltman, 2013).

Segmentation is used to find out who the company wants to approach for a certain marketing campaign activity. A theory for finding out who you want to approach is recency frequency monetary value (RFM). Marketers think that behaviour is important to segmentation. Observing historical behaviour seems to be more reliable than other methods for predicting the future purchasing. The RFM method focusses on the frequency and the most recent transaction date in addition to the annual amount spent. Big data is necessary because of the collection of data from various sources. Most of the companies already have this information because these are common aspects to measure. The method works with scores, weighted for their importance. The scores need to be given to the following aspects:

  1. Last purchase date
  2. Purchase frequency
  3. Amount spent

To make this theory clear, you find an example below.

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The conclusion is that companies definitely can create profit through the use of segmentation and selection. The objective of segmentation is that customers become more satisfied and loyal and as a result, the customers will spend more. By using the RFM method, the company can look which division they want to approach. If the company attracts the right division, it will lead to more profit.

This is also for the hotel industry. By using the segmentation criteria, the hotel can choose the division they want to attract and make more specific action towards this group. If the hotels choose the right group to approach their campaign by using the RFM method, they can definitely make more profit.

Bibliography

Company, B. &. (2015). Customer Segmentation. Retrieved from bain: http://www.bain.com/publications/articles/management-tools-customer-segmentation.aspx

Itracmarketer. (2016). Hit your targets: Using data segmentation to increase your bottom line. Retrieved from Itracmarketer: https://itracmarketer.com/wp-content/uploads/2016/01/audiencesegmentation.png

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

 

Customer Journey Mapping in 4 steps

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Resource: (adformatie, sd).

Customer journey mapping is a customer focused method for developing innovative service concepts and the optimization of customer processes and services. It shows where to improve the customer contact to achieve an optimal customer experience across all channels (Bekel, 2015). It describes the experience of the customer during the journey. The journey begins at the orientation and ends when the guests come home. Hotels can identify data by understanding their role in each step and by reacting in the proper way. By following and reacting in the right way, the hotels can improve the customer experience.

A customer journey mapping strategy focuses on the individual travellers. By using this strategy, a hotel can identify the desires and expectations of their guests and give the travellers the products and services they need at every step of the customer journey (Dent, 2013). The guests in a hotel need to be happy and satisfied because 91% will not return after they had a bad experience.

The customers have different expectations at every step of their journey. It is very important to reach the products and services at the right time during this journey. It is getting more and more important to create the experience around the customer.

To create a customer journey mapping strategy, follow the steps below.

Step 1: clear vision on the company

Before making a customer journey map, it needs to be clear as an organization what the company wants, what the company can do and how the company can do this. If the vision is clear, it will lead to more success. Moreover, the character of the company decides how it responds to the needs of the customer.

Step 2: make personas

The hotel needs to make personas. They need to know the type of customer and the value that the customer brings to the hotel. The most important touchpoints during the journey depends on the persona because every persona expects something else from a hotel experience. To have a good overall view, the hotel should make four to seven personas. Dent has four personas: business, leisure, family and special needs.

Step 3: identify the touchpoints in the customer journey

The next step after creating the personas is to identify the touchpoints in the hotel journey from the perspective of the different personas. By doing this, the touchpoints of the customer experience will reveal. For each touchpoint, we identify the different elements within that touchpoint. Consider which type of interaction there could be with the guest at that touchpoint.

The customer journey will looks as following:

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Retrieved from: (CMSwire, 2013).

Step 4: analyse the points of improvement and look for solutions

Write down the points of improvement and look for as many as solutions as possible. After this brainstorming session, see which options are feasible for short-term and long-term objectives.

Customer journey mapping is important because the touchpoints whose are most important to interact with the guests, can be identified. By using this strategy the points whose are going well  become clear and also which can be improved to increase revenue and grow brand loyalty.

Bibliography

adformatie. (n.d.). customer journey to online purchase tools. Retrieved from adformatie: http://www.adformatie.nl/sites/default/files/blog/customer-journey-to-online-purchase_tools_sm.jpg

Bekel, P. (2015). Customer journey mapping in 5 praktische stappen. Retrieved from Frankwatching: https://www.frankwatching.com/archive/2015/02/18/customer-journey-mapping-in-5-praktische-stappen/

CMSwire. (2013). Media. Retrieved from cmswire: http://www.cmswire.com/~/media/fdfd6377487a412ca3681a4c14015500.png

Dent, J. (2013). Customer Journey Mapping: A Walk in Customers’ Shoes. Retrieved from ascendforairlines: http://www.ascendforairlines.com/sites/default/files/article_0.pdf

van Nouhuys, R. (2011). Customer Journey Mapping: klantervaring als inspiratie voor strategie en ontwerp. Retrieved from frankwatching: https://www.frankwatching.com/archive/2011/03/29/customer-journey-mapping-klantervaring-als-inspiratie-voor-strategie-en-ontwerp/

 

 

Distinguish in the hotel industry

One of the greatest challenges in the hotel industry nowadays is the ever-growing number of competitors. Hotel managers are facing a problem: ‘’What can I do to differentiate my hotel from the others?’’ It became a standard for every hotel to offer facilities like a bar, restaurant and room service, this is not considered a luxury anymore. So what is the next step that has to be taken when you are operating in the hotel industry? Of course you can offer a low cost service, and convince customers to spend the night in your hotel for the lowest price (operational excellence). But there is another way to bind the customer to your brand: customer engagement management (Kandampully, 2000). In this article we take a closer look at this essential strategy in the hotel industry.

The understanding customer intimacy was introduced by Treacy  & Wiersema. According to their book ‘Customer Intimacy’ this strategy is one of the three value disciplines that can lead to market leadership (Customer Intimacy, 2016). Develop, build and maintain a relationship with the individual customer is key within this strategy. Every person has different preferences and interests and to expand the involvement of your relationships, you should react to every customer adapting to these preferences. The ultimate goal is to build and maintain a relationship between the brand and the customer. You basically create a ‘have it your way’ feeling for every customer.

Give more than what is expected, is an important principle when you want to create loyal customers. It is all about the customer’s wishes and giving them a certain amount of service they wouldn’t expect in advance. The more you go beyond their expectations, the bigger the chance the customer feels connected to the brand (Wat is customer intimacy?, 2016).

Digitalization is an important trend according to customer engagement management. The newest technology offers the opportunity to genuinely get to know your customers.  You can gather data from the moment the (potential) customer visits your website till the moment they check out in your hotel. This provides a closer look into the wishes and needs of every single customer and in this way an organization can personalize their approach towards the customer.
Because in the end, a hotel succeeds or fails based on the satisfaction throughout the customer’s stay.

In the end, if the customer is likely to think: ‘’Wow, this company truly understands me.’’ You not only reached customer intimacy, but (even better) emotional loyalty with your brand. Emotional loyalty is a psychological preference and affective attachment (Davey, 2014). An emotional loyal customer is more likely to stay loyal to your brand, even if there are potentially better alternatives to choose.

Bibliography

Customer Intimacy. (2016). Opgeroepen op September 18, 2016, van VerduinCRM: http://www.verduin.nl/crm-kennisbank/wiki/bid/159876/Customer-intimacy

Davey, N. (2014, Mei 1). Emotional vs transactional loyalty: Is it more important to win hearts or minds? Opgeroepen op September 18, 2016, van MyCustomer: http://www.mycustomer.com/experience/loyalty/emotional-vs-transactional-loyalty-is-it-more-important-to-win-hearts-or-minds

Kandampully, J. (2000). Customer loyalty in the hotel industry: the role of sutomer satisfaction and image. MCB University Press.

Wat is customer intimacy? (2016). Opgeroepen op September 18, 2016, van Team Loyalty: https://teamloyalty.nl/kennis/wat-is-customer-intimacy/

 

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

Returning customers through automation in the hotel industry

blog1Source: (Cyberspaceandtime)

Normally there are a lot of annoying bits when going to a hotel which may reduce the pleasure of visiting a hotel. For example, the check in cost a lot of time, fortunally there are some hotels who solved this problem. Yotel is one of them, they have an automated check in and out (Yotel). Another hotel that has a automation check in and out is Nordic Choise Hotel, guests can check in prior by using the web or mobile check-in platform. Guests can use their phone as a key for the room (Hopkins, 2011).

In Japan, they opened a hotel called ‘Henn na Hotel’ that is run by robots, entirely. This is the first automated hotel where you enter your hotelroom by facial recognition technology. This way of running a hotel is saving energy and saving costs methode (RELAXNEWS, 2015). Then robots will take care of the room cleaning, transportation of luggage and greeting guests. The creaters have made the robots as human as possible. The robots can blink, breath and make eye contact. Furthermore, they can assess people’s mood by camera’s and microphones (Cuthbertson, 2015). Henn Na hotel calls the concept “The Ultimate in Efficiency.” (Hotel, 2015).

The automation in these hotels ensure returning customers because everything goes quick, it is an environmentally beneficial change and it still has a human aspect because the robots are as human as possible. Customer engagement management is necessary for returning customers. Treacy and Wiersema made a model where de main focus of the company can be seen. They discerned three ‘value disciplines’; operational excellence, product leadership and customer intimacy (Peelen & Beltman, 2013)

These hotels who already use automated techniques focus on operational excellence because it consitutes the smooth running of the company. The automated techniques provide low costs and thus reduce unnecessary costs. They found a combination between price, quality and ease. Furthermore, these companies also have product leadership because they will always try to aim for a new and innovative product. The hotel in Japan is the first hotel runned by robots so they are very innovative. With these new techniques, they amaze the customer with their new kind of method. The last point is customer intimacy, this involves maintain contact with the customer and make sure the guest has a pleasant stay. Because of the new techniques, the guests’ stay will be as optimal as possible and everything costs less time. The robots have human characteristics so they can treat the guests in a human way and the robots will always be kind. This means that there is no sign of grumpy employees.

The conclusion is that automation in the hotel industry is very good for customer engagement management because they score very well on every sphere of the theory of Treacy and Wiersema. The automation will certainly provide a lot of repeat customers.

Bibliography

Cuthbertson, A. (2015). Hotel staffed by humanoid robots set to open in Japan this summer. Retrieved from ibtimes: http://www.ibtimes.co.uk/hotel-staffed-by-humanoid-robots-set-open-japan-this-summer-1487151

Cyberspaceandtime. (n.d.). Your smartphone is your hotel key. Retrieved from Cyber Space: http://cyberspaceandtime.com/Your_smartphone_is_your_hotel_key/Q5qH1cMH0-I.video

Hopkins, C. (2011). First All-Automated hotel opens in Norway. Retrieved from Readwrite: http://readwrite.com/2011/01/21/first_all-automated_hotel_opens/

Hotel, H. N. (2015). Home. Retrieved from Henn Na Hotel: http://www.h-n-h.jp/en/

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

RELAXNEWS, A. (2015). Japan opens hotel run entirely by robots. Retrieved from nydailynews: http://www.nydailynews.com/life-style/japan-opens-hotel-run-robots-article-1.2297588

Yotel. (n.d.). Discover Yotel. Retrieved from Yotel: http://www.yotel.com/en/discover-yotel