Are Your Customers Asking For A Divorce Or Are They ‘Feeling The Love’

According to a new study released by CMO Council entitled “The Leaders in Loyalty: Feeling the Love from the Loyalty Club“, 54 percent of the consumers surveyed let it be known that thanks to the barrage of irrelevant messages, low value rewards, and impersonal engagements, they aren’t feeling the love.  In fact, they are thinking of asking for a divorce.

The study suggests “The reality of today’s loyalty landscape is that too many rewards, points or perk programs out there are still only as sophisticated as those early trading stamp programs.  They dish discounts and free stuff to repeat buyers and gather about as much insight from the customer as those first shopkeepers exchanging place settings for swollen stamp books.”

So how does your brand’s loyalty program stack up against #1 American Express?

While you ponder that question let’s look at key indicators that customers didn’t like about loyalty programs.

• Too much spam and junk email topped the list of negatives at 44 percent
• Too many conditions and restrictions at 38 percent
• Rewards that lacked real value at 37 percent

Other prevalent complaints included members having a hard time redeeming points or rewards, program membership lacking value, and communications and services not being personalized or target specifically for members.

If you intend to have a successful loyalty program you must understand key customer requirements like “personalization”, “individualization” and “value”.  Today, customers are looking for greater rewards that “earn” their business and while they are open to “perks” what they really want is to be embraced and know by the business they patronize.

It’s About Product Positioning And Not All About Price!

I talk to Sales Managers at hotels on almost a daily basis and one of their most commonly asked questions is “What will it take for us to win this piece of business?”

“Well you can lower the rate to $99, give me a 1 per 20 comp, waive the attrition, and throw in the Presidential Suite for me and the family for the week!”

OK, let’s get serious and break down the question to its simplest form.

“What will it take” are four words that should send a chill up the spine of every customer who is posed the question.  Why?  Because it’s “old school inside the box sales 101”.  It’s “let’s go down the price path” which gives you and the customer nothing more to discuss than price point.

Now close your eyes…take a deep breath…exhale…and repeat this sentence…“What do I need to know that will allow us to provide you with the best deal possible?”  Now open your eyes.  See, you feel much better now don’t you?

“What do I need to know” are words that say “I need to find out what you’re really looking for so I can best position and offer that’s a win-win”. 

You see it’s about product positioning and not all about price.  Here are some thoughts that will help you to position your product and close more deals.

Find attributes about your hotel that your customer can hang his hat on.  You need to find deliverables that inspire, motivate, and encourage the customer to seriously consider you as a candidate for the short list or a contract.  Remember that “price” is only one part of the equation.  If your hotel can’t stand up and deliver after the contract is signed, price means nothing.

Here is how Boca Raton Resort positions their resort…”Designed by legendary architect Addison Mizner (I don’t have a clue who this guy is), Boca Raton Resort, The Waldorf Astoria Collection (that’s selling sizzle) has reigned as an icon of elegance for more than 80 years (that’s staying power, reliability and consistency).  Today, the resort remains faithful to its glamorous past (here’s the hook), but radiates a vibrant new energy (not a musty 80-year old resort on the beach) and offers infinite amenities to provide each guest with the perfect getaway” (there’s something here for everyone). 

If you’re the ABC Airport Hotel, you still have attributes that are particular to your market niche IF you take the time to look for them with a new attitude.

Let us examine an analytic model of competitive market equilibrium in the presence of switching costs?  But seriously you need to understand your competitive set and the perceived “switching cost” for a customer.  Switching costs or switching barriers are terms used in microeconomics, strategic management, and marketing to describe any impediment to a customer’s changing of suppliers.  This is essentially what you are dealing with every time you sell against your competitive set.

Reinvent the customer experience.  There are so many things that have changed in this world over the past 12 months and those changes have directly or indirectly impacted both you and your prospective customer.  What’s important to your customer today may not be the same thing that was important to him 12 months ago.  Look for those signs, rethink the customer experience, and take advantage of it.

Position your product relative to the market leader in your competitive set.  Publicly or to prospective customers, always put your hotel on the same level as the market leader in your competitive set.  It elevates your hotel in terms of customer perception and allows you to sell without the need to “look over your shoulder”.

Find support for your hotel in and outside of your four walls.  Right now there is a customer checking out at your front desk who can attest to the great experience that he had while attending a meeting at your hotel.  Are you in your office pushing paper or out polling a potential army of supporters?  It’s actually kind of a fun exercise especially if you can find someone who is not rushing out the door to catch his next flight.

Are Hotels Blowing Leads?

Michael Ferree, Account Director with Geary Interactive, published an interesting article entitled “How marketers are blowing lead management” on today’s iMedia Connection website. 

Ferree suggests that a study performed by lead management software company Leads360 exposed a number of important facts about performance-marketing and lead management. One important statistic shows that converting a lead is 57 percent lead quality and 43 percent an efficient sales process.  One without the other is not the answer.

So how does this apply to the hospitality industry?  Prospective customers are shopping for a hotel and in many cases they are truly undecided about which hotel best addresses their needs, and they need help deciding. 

All of the major OTAs offer robust hotel information on their websites but don’t give a telephone number where a prospective customer can speak to a hotel representative.  When we placed a random call to a local full-service hotel (their site provided an 888 number which was associated with a call center) there was no one available to take our call and we were prompted to leave a message. 

Call abandoned, blown lead.

The goal is to speak to a prospective customer while they’re interested in being assisted and can potentially be converted into a booking.  Contact speed and professional staff are the two most important factors in managing this initial contact.  A minute later, or in our case three minutes later, a customer will lose interest and give their business to your competitor.

Is The Hotel Industry Prepared For The Tech That Will Carry THEM Forward?

According to panelists at last month’s Hotel Electronic Distribution Network Association annual meeting, future technological advances will need more and more flexibility to handle the demands of hotel owners, operators and guests.

Where have pundits like Vegas.com’s Howard Lefkowitz and Expedia’s Pamela Keenan Fritz been for the past two years and why are they grappling about issues such as “standardization” when this industry lags two to three years behind the TECHNOLOGY curve?

As per Lefkowitz, “We have to look at the whole experience differently from a consumer perspective then look at existing systems and figure out to use those systems a different way.  It’s about figuring out a way to work them together to get out of this commoditization issue.”   

Howard, wake up and smell the coffee.  It’s not about standardization, just yet, it’s about embracing and implementing new technologies and simply giving the customer what he expects and deserves. 

There is a lot of noise out there and it sounds good to your prospective customers IF you can sing their tune and not yours.

Hotel Marketing Trends For 2010

2009 was a very difficult year for hoteliers across the board and the prognosis for 2010 is not much brighter. 

Industry reports show that in 2010, hotels will continue to experience declines in revenue and profits, and the recovery is expected to be slow and painful. According to PKF Hospitality Research, in 2010 hotel occupancy will increase by only 0.4%, while ADR and RevPAR will decline further by 1.5% and 1.1% respectively.

So here are four marketing trends that hoteliers need to adopt in order to compete in these challenging economic times. 

E-mail – There has been a noticeable uptick in e-mail marketing over the past six months because of its cost efficiency and targeting capabilities.  We expect that trend to continue well into the third quarter of 2010.  E-mail provides a verifiable ROI and can integrate with other new media channels including social media and mobile.  The challenge for hoteliers is “inbox overload” and they will have to focus on customer preferences to compete.

Mobile – 2010 is the year that hoteliers must seriously consider making a sizeable investment in mobile marketing.  The ability to target ads on the phone and enable prospective customers to book direct is crucial to increasing traffic and conversions. With mobile phones becoming an increasingly important marketing and CRM channel, improving technology and awareness will soon allow hotel marketers to enhance the hotel guest interaction.

Social Media – Hoteliers experimented with social media like Twitter and Facebook in 2009 and must commit to making a serious effort to move beyond “Fan pages” to offer customer services through social channels.  Social media must be an integral part of their 2010 CRM campaign and begin using it as a dedicated resource for strategic services and direct communication with customers.

Online Videos – Printing and production channels have changed dramatically and going “green” is more than just a buzz word.  Hoteliers must invest in a video production that can be viewed on the hotel’s website to help “influence” a customer’s booking decision and incorporated into YouTube (the second largest search engine just behind Google) and Facebook.