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Lessons from the Field
A Common Sense Approach to Success in the Hospitality Industry
By Dr. John Hogan, CHA MHS CHE, August 20, 2008

Ways to Identify and Build Repeat Guests


 

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By Dr. John Hogan CHE CHA MHS
August 21, 2008
There are only two ways to get a new customer: 1. Solicit a new customer any way you can. 2. Take good care of your present customers, so they don't become someone else's new customers.  Ed Zeitz
The book “In Search of Excellence” in the early 1980s by Tom Peters and Robert Waterman presented numerous examples and statistics on the need to pay real attention to the customer’s needs and wants.  This was a paradigm shift at that time, when customers in many industries were forced to choose from what was being offered to them, which was not necessarily what they were seeking.

The hotel industry has made adaptations over the past twenty five years with market and product variations.  Most of the brands are currently focusing at least one initiative on customer service, but in these days of economic uncertainty, a reminder of the basics of customer service can be an amazing refresher for many hotel staff.

The following are offered for consideration in that refresher:

1. Focus on existing customers. This is critical, especially at a time when demand is lessening in various markets.  If a hotel’s efforts are focused primarily on acquiring new customers, existing customers will feel that from the staff and consider options. Think of advertisements for any product that is only offered to “New Customers”.  You may have had that residential cable service at your home for the past five years and today “new” customers are offered a value or incentive far better than what you receive.  How do you feel about that service? 

2. One of the leading causes of the high turnover of hotel sales managers isn't necessarily the economy - it's often ignored syndrome of customer attrition. The difference between a satisfied customer and a loyal customer is the first might return to your hotel again and might refer others, while the loyal customer will return again and will tell others about your hotel and its’ service.  What are the messages that your sales team is delivering? What does your marketing plan say about existing customers?

3. Stress value and guarantees.  There is no doubt relating to the success of the Hampton Inn brand industry leading 100% Satisfaction Guarantee.  Every customer has their own preferences or definitions of value, but when your staff communicates the hotel’s sincere commitment to meeting those preferences and needs, the customer/guest is impressed enough to become a repeat guest.  I am not suggesting a “me-too”  approach on how to communicate and deliver that commitment, but value and concerns must be there for sustained success.

4. A key point in training is to calculate and leverage the lifetime customer value. For example, if a guest stays 3 nights per month @ a rate of $150 per night, the monthly gross revenue is at least $450 or $5400 annually.  While that may not seem like a huge number, when one calculates the number of existing customers that might be in this category (say 50 customers) , the value of the existing customers is has now grown with those 50 customers to more than $250,000 annually. These 50 customers do not need to be wooed or convinced to choose your hotel but they do need to feel appreciated and valued.  Nearly all successful infomercials and other business models are based on repeat sales and word of mouth testimonials. 

5. In an age when the cost or magnitude of  mass communications makes it difficult to attract new customers, keeping the existing customer is so fundamentally obvious.  With the technology available to create a simple or sophisticated CRM or guest history, there is no reason to ignore this. 

6. Look at your hotel and its operational practices through your customer's eyes … and you might be shocked at what you see.  A simple illustration is found at every front desk.  When someone approaches the desk, do they hear the question “Checking in??”  or something more hospitable, such as “welcome” or "We've been waiting for your arrival!”   Which sounds more inviting and personal? The approach should be personal, but it does not require much more than a little bit of creative staff team brainstorming and paying attention. "Have a Nice Day" tired expressions don't work anymore.

7. Rebuild all of your operational practices around your customer's real needs and desires. Your customers have changed over the last ten years. Have you? 

8. Invest in your capital improvements each year to improve loyalty, not just satisfaction. Assess which aspects of customer satisfaction drive retention as well as those which do not.

9. Segment your customers for improved retention.  Remember the expression : “different strokes for different folks”, which means as people may choose their preferred swimming stroke, hotel customers also have their own preferences.  A corporate traveler has different needs than a youth sports team.  The resurgence of women’s’ floors is not the same as the “Lady Sheraton” rooms or suites offered a generation ago, but are targeting the unique needs of the professional woman traveler today that has become a major segment.  What do your customers want?  Are they receiving it?

10.  Make the interaction with your customers real and personal – after all, people conduct business with people.    Stanley Marcus,  the co-founder of luxury stores Neiman – said it very clearly  -  Consumers are statistics. Customers are people. 


Feel free to share an idea at johnjhogan@yahoo.com anytime or contact me regarding consulting, customized workshops or speaking engagements.  Autographed copies of LESSONS FROM THE FIELD – a COMMON SENSE APPROACH TO EFFECTIVE HOTEL SALES can be obtained from THE ROOMS CHRONICLE  www.roomschronicle.com and other industry sources. 

All rights reserved by John Hogan.   This column may be included in an upcoming book on hotel management.

John Hogan’s professional experience includes over 35 years in hotel operations, food & beverage, sales & marketing, training, management development and asset management on both a single and multi-property basis.  He holds a number of industry certifications and is a past recipient of the American Hotel & Lodging Association’s Pearson Award for Excellence in Lodging Journalism, as well as operational and marketing awards from international brands.  He has served as President of both city and state hotel associations.

John’s background includes teaching college level courses as an adjunct professor at three different colleges and universities over a 20 year period, while managing with Sheraton, Hilton, Omni and independent hotels.  He was the principal in an independent training & consulting group for more than 12 years serving associations, management groups, convention & visitors’ bureaus, academic institutions and as an expert witness.  He joined Best Western International in spring of 2000, where over the next 8 years he created and developed a blended learning system as the Director of Education & Cultural Diversity for the world’s largest hotel chain. 

He has served on several industry boards that deal with education and/or cultural diversity and as brand liaison to the NAACP and the Asian American Hotel Owners’ Association with his ongoing involvement in the Certified Hotel Owner program.  He has conducted an estimated 3,100 workshops and seminars in his career.  He served as senior vice president for a client in a specialty hotel brand for six years.

He has published more than 350 articles & columns on the hotel industry and is co-author (with Howard Feiertag, CHA CMP) of LESSONS FROM THE FIELD – a COMMON SENSE APPROACH TO EFFECTIVE HOTEL SALES, which is available from a range of industry sources and AMAZON.com.  He resides in Phoenix, Arizona and is finalizing his 2nd book based on his dissertation –     The Top 100 People of All Time Who Most Dramatically Affected the Hotel Industry.

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Contact:

Dr. John Hogan, CHA MHS CHE
johnjhogan@yahoo.com

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Also See: Principles for Success As a Hotel Manager - Maintaining Relationships Throughout the Organization / Dr John Hogan / August 2008
Principles for Success As a Hotel Manager - Part four: Communicating with Clarity and Candor / Dr. John Hogan / July 2008
Principles for Success As a Hotel Manager - Part three: Using your management style effectively / Dr. John Hogan / July 2008
Principles for Success As a Hotel Manager - Part Two: Motivating the Team / Dr. John Hogan / July 2008
Principles for Success As a Hotel Manager Part One: Understanding the Organization / Dr. John Hogan / July 2008 
Updating Hotel Marketing and Sales Strategies Mid Year NOW Is Essential / Dr. John Hogan / June 2008
Don’t Underestimate the Impact of the Hotel Sales Office / Dr. John Hogan / June 2008
Factors for Successful Interviewing Potential Hotel Sales Candidates / Dr. John Hogan / June 2008
The Importance of Meaningful Sales Team Job Descriptions / Dr. John Hogan / May 2008
For Hotels with Limited Service, Fewer than 100 Rooms - How Do You Determine if You Need a Person Dedicated to Selling / Dr. John Hogan / May 2008
Extending Your Sales Team or Make Travel Agents A Regular Part of Your Sales Programs / Dr. John Hogan / May 2008
Finding Business Leads Can Be Easier Than You Think / Dr. John Hogan / May 2008
Understanding the Differences Between Marketing and Sales / Dr. John Hogan / April 2008
Identifying Your Customers / Lessons from the Field A Common Sense Approach to Success in the Hospitality Industry / Dr. John Hogan / April 2008
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