CUSTOMER RELATIONSHIP MANAGEMENT AND ITS RELEVANCE TO THE HOTEL INDUSTRY

A few years ago CRM became one of the big marketing buzz words. It was identified as the key strategy to the future success of any business. Manage your customer relationships and you were guaranteed a prosperous future! Many people thought that this was simply stating the obvious and believed that of course they already managed their customer relationships, while others viewed it as yet another fad that would come and go, but make a few 'consultants' a lot of money in the meantime! In fact many large business have evolved on the back of CRM because of the need for software for the customer database, the need for a method of communicating with this database, increasingly electronically, and the need for sales force automation. All of the large software companies and large consultancies offer a range of CRM solutions.

But what precisely is CRM? It's objective is clearly to build profitable customer relationships. But at what point in the relationship and in what way? And what is its relevance to the hotel industry?

Essentially you are trying to develop a comprehensive picture of your customers needs, expectations and behaviours by gathering information from every point of contact that you have with them. And then you want to take initiatives that demonstrate to the customer that your understanding of their needs is better than your competitors and that you are in a far better position to meet their needs than anyone else. Hotels are in a very strong position to build up this picture. Thanks to the software installed in most hotel operations you know precisely what every guest did during every moment of their stay with you. In fact it starts even before then. You know how and when they made their reservation and hopefully you know the purpose of their stay with you. You know their address and thus how far they are travelling. You also know what rate they are paying and whether they are eligible for any form of corporate rate and their length of stay. And during the stay you know which room they stayed in, what in-room movies they watched, what food and drink they consumed where and when, what usage they made of the telephone and laundry and what time they checked out. You have the potential to use this information to both drive business and to make the guest feel very, very special each time he stays with you.. There is time or a cost involved in doing this, but if you want a profitable long-term relationship with the customer it is a worthwhile investment.

Hotels typically make far too little use of the information available to them in their own PMS system. I suspect that this is because the PMS system is in the domain of the Operation and thus 'outside' the area of responsibility of Sales & Marketing. And far too rarely does a hotel make use of the Guest History to make the individual guest feel very special and very welcome. The only exceptions being five star or very small private hotels who seem to appreciate that giving the guest the impression that you have remembered and care about the things that matter to him (even if you simply pulled it up from the PMS) will buy you guest loyalty. CRM is almost about providing superior service at every point of contact with the guest because you have established a picture of his behaviour.

For example, if the only thing I ever drink out of my in- room mini-bar is the still mineral water, how wonderful if the next time I check in I'm asked if I would like a couple of large bottles in my room each day. Of course I will be charged for them, but you have made me feel very special, I will certainly be telling a lot of people about this 'lovely touch' and you will have bought my loyalty for many years to come.

CRM has another totally different angle in hotels in that the customer and the guest are usually two completely different people. The scenarios described above relate to the guest. But what about the decision maker, influencer, booker or even booking agent? They may never stay with you but they are responsible for generating hundreds or thousands of room nights each year. Neither relationship is more or less important than each other. They are different and need managing by different people in a different way. Managing the customer relationship (as opposed to the guest) is the clearly the responsibility of Sales & Marketing. Systems such as Fidelio Sales & Catering have enabled hotel sales teams to manage these relationships intelligently and professionally. The system even makes them aware of bookings and enquiries received from these clients. But many hotels totally overlook the marketing opportunities that these relationships present. There may be 100,000 customer contacts set up in such a system, only a fraction of whom will be called upon by a sales person, so you need to use marketing to reach the rest of them. And this is where technology allows you do this in a very targeted, timely and cost-efficient way. E-mailings can be handled in such a way that the recipient doesn't know that anyone else has received it, that the message offers them benefits that appear uniquely tailored to their needs and that makes them feel that you genuinely care about their business. You are showing them that you wish to develop a meaningful relationship with them.

CRM is not just a fad. It is here to stay for the simple reason that positive customer experiences create loyalty and in turn create brand value. And strong brands are the ones that survive in tough times.

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