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CRM Technology for Travel:
Data Analytics - Things That Make You Say Hmmm...


By Gregg Hopkins, President and CEO, Libra OnDemand
October 28, 2010

Assigning monetary value to customer data is a concept that few hotel businesses seem to be embracing, although it makes a great deal of sense to do. We treat everything else in our organizations as assets with measurable financial worth: inventory, people, property, etc. But, have you ever sat down and calculated a dollar value for your customer database? What about the monetary value of a specific guest? My guess is that you probably have not.
 
So what would go into such a calculation? You should certainly consider past, current and future earnings for each customer in your database. Then, with a fair degree of certainty, this information will reveal how much revenue you can expect that account, group or guest to spend in the future based on past performance. Over the years, hospitality organizations have “guesstimated” this information when forecasting based on a variety of sales and performance metrics that they track. Rarely has this information been obtained from an easy to access, real time, on demand data source – until now. With the rapidly expanding development of cloud based technologies, hotel organizations now have the ability to examine their customer database and accurately assign monetary value.
 
But, what about risk? The loss of any data that you maintain, particularly if it contains information subject to regulatory control (credit card numbers, etc.) carries a certain amount of risk if that data was ever lost, damaged or stolen. It's the same as if you had inventory lost, damaged or stolen. And, as you accumulate more data, your risk of loss increases. This is why a cloud based solution is so ideal. Take Salesforce.com, for example, the global leader in customer relationship management and cloud computing. Salesforce.com is not only the world’s #1 sales application, but it also utilizes some of the most advanced technology for Internet security available today. So, when you access their site using industry standard Secure Socket Layer (SSL) technology, your customer data is automatically protected using both server authentication and data encryption, ensuring that your information is safe, secure, and available only to registered users in your organization. Your data is guaranteed to be completely inaccessible to your competitors.
 
Here’s another consideration when managing your customer information: many technology vendors actually charge their customers to access their own data. Now, this baffles me. It’s your data so you should not be charged anything additional for using it. It’s not like it’s the vendor’s own proprietary database; most likely, it’s Microsoft, Oracle, SyBase or some other flavor. And, the copy and exporting of that data is not affecting the vendor’s application. Your customer information should be available to you to be freely exported to another system so that it can be analyzed and used more effectively. Or better yet, you should be able to have data exchanged between vendor applications and other external solutions.
 
So, now that you have all this customer data, what do you do with it? Comprehensive data analysis is critical for the Revenue Analyst who, for example, may want to prepare next year’s budget by querying, “What effect do various business sources have on our revenue?” To answer this question they need to examine hotel sales through such sources as online travel agents (i.e. Expedia, Travelocity), GDS, property website, direct sales, 800 number, etc. Then, with these clearly reported statistics, they can determine which sources are most profitable, produce the highest return on investment, and should therefore be accounted for in the future budget and part of the hotel’s distribution strategy.

Knowing all about your frequent customers is also a very important aspect of your overall business success. But, what about those customers that have stopped or decreased the amount of business with your hotel? For example, do you know which one of your frequent, loyal guests has not visited your property in the past six months? An effective CRM should be capable of examining your producing and non-producing accounts and contacts, see those guests, travel agencies, and companies that have changed their stay patterns and buying habits. From those results, you can then create an email campaign to reestablish contact or an action item for your Guest Services or Sales Manager to telephone the customer directly.

A final consideration when analyzing the overall value of your customer and their stay tendencies is to collect the information from various sources (PMS, CRS, activity management systems, etc.). One source is not enough. For example, what if your customer stays in your hotel only a few times a year, but dines in your restaurant three times month? Or, what if they exclusively have treatments in your Spa on a regular basis? Relying on only one data source can really skew the analysis of your customer’s value to your organization. So, having a comprehensive system that brings all that information together is the key.

Things to ponder about your data analytics:
1.     Can your current system assign monetary value to your customer data?
2.     Is your data secure?
3.     Do you have complete and free access to your data?
4.     Are you using all your data to improve your customer relationships?

No doubt that effectively collecting, analyzing and securing all your customer data is as important as ever to your organization’s success. Hmmm…

About Gregg Hopkins
Gregg Hopkins is the President and Chief Executive Officer of Libra OnDemand LLC.  Gregg has over 25 years of experience in hotel management and hospitality technology. He has worked with various enterprise property management and central reservation system providers, online travel agencies, and destination vacation portals.  He has also provided consulting services to hospitality organizations on reservations electronic distribution, technology, e-commerce initiatives, CRM initiatives, marketing, sales strategy, and business development.  Gregg is a subject matter expert on hospitality management systems, electronic distribution, and CRM.  He also participates as a committee or board member of several industry associations.  Gregg can be reached at ghopkins@libraondemand.com.

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Contact:

Gregg Hopkins, CEO
Libra OnDemand
Tel: +1.407.412.9296
ghopkins@libraondemand.com 

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Also See: Social Networking Tool Makes Collaboration Easy For Libra OnDemand Users; Salesforce.com’s Chatter, embedded in Libra OnDemand, boosts CRM efficiency and improves internal communication / October 2010

Libra OnDemand Powers Loyalty Website for Premier Hotels; Leading SaaS CRM solution provides tools to enhance guest relationships / September 2010

Libra OnDemand Announces Two Key Appointments; Leading hospitality CRM company continues growth with addition of Customer Success Manager, Account Executive / August 2010

Libra OnDemand’s Cloud Platform Keeps Sales Bubbling At Miracle Springs Resort; Luxury California convention center resort credits Web-based scheduling application with saving time, closing deals. / July 2010

CRM Technology for Travel: Cloud Technology - What It Is and What It Isn't / Gregg Hopkins / July 2010

Libra OnDemand Powers Premier Hotels’ Loyalty Program Upgrade; Luxury hotel group uses Software-as-a-Service platform to build guest relationships, streamline operations. / June 2010

Libra OnDemand to Showcase Award-Winning SaaS CRM Solution at HITEC 2010; Hotel technology takes to the cloud, as industry-leading CRM provider demonstrates how their innovative suite of Force.com applications saves time and money for hotel clients around the globe. / June 2010

Libra OnDemand Launches New Corporate Web Site on Force.com Platform; New Libra OnDemand Web site leverages the power of Force.com to provide increased functionality and interactivity for hospitality clients / May 2010

Libra OnDemand Personalizes The Surrey’s Guest Data; Actionable data empowers employees at intimate property in Manhattan’s Upper East Side / May 2010

Libra OnDemand CRM Platform Certifies Compliance with Safe Harbor Privacy Framework; SaaS-based CRM technology solution leverages the online privacy protection and data security certification of Salesforce.com / March 2010

Libra OnDemand Selected as Finalist in Force.com Forty Innovation Showcase; Comprehensive suite of hospitality-specific applications consolidates customer information, develops deep profiles and delivers guest satisfaction / November 2009

Libra OnDemand in Full Social Swing with Presence on Facebook, Twitter, and LinkedIn; Hospitality CRM provider encourages hotels to integrate customers' Tweets and Facebook profiles with CRM profiles to obtain a more complete picture of guests' preferences and better tools to market to those guests / October 2009

Libra OnDemand Partnership Brings 'Sulcus OnDemand' CRM to Spain; Based in Barcelona, Sulcus Hospitality Group becomes Libra OnDemand's newest channel partner; Sulcus calls deal win-win for companies, clients and guests alike / September 2009

McLaren International Distributes Libra OnDemand in Asia Pacific; Best of breed technology provider McLaren International will bring leading Customer Relationship Management tools to hotels across the Asia Pacific region / July 2009

Libra OnDemand adds MSI to its Growing List of CRM Channel Partners; New Software as a Service sits on the salesforce.com platform, offering the finest business-analytics tools for Guest Profiling, Loyalty & Rewards, and Sales & Catering / June 2009

Peabody Praises Libra OnDemand as ‘Best’ System to Manage Guest Data; ‘Software as a Service’ sits on the salesforce.com platform, offers the four-star, five-diamond convention center hotel the finest business-analytics tools / June 2009

Libra OnDemand Intros 'Customer Portal' CRM Tool for Pre-, Post-Stay Interaction; Leader in Customer Relationship Management empowers guests to personally control their hotel experience and update their contact info, preferences, loyalty points / June 2009
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