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by Georges Panayotis

Where does one draw the line between knowing the habits of customers in order to provide individualized and personalized service and invading their private lives and personal behaviors? 

 

This question constantly stirs up marketing managers at hotel groups during the conception of CRM software and their use. They know perfectly well that there is a boundary that must not be crossed in order to respect the confidentiality of certain information and that a questionnaire about personal preferences should not feel like an inquisition. It is always the customer himself who decides to give the information he feels is necessary – and sufficient – for improving his stay.

But what is happening as community sites make a massive irruption into the hotel universe? Hoteliers are increasingly losing control over these sites and these new actors, with their vast means in terms of IT, are more mercantile than marketing oriented. Big Data is tomorrow’s black gold, commented one careful observer of the evolution of the IT sector. Gathering this information is a priority for Web giants to feed an immense data reservoir where bank data, consumer habits, personal preferences, right down to little secrets revealed by purchases all converge with no real guarantee of confidentiality.

There is no guarantee that the channels are sealed and that the network will not create an extremely precise profile of each internet user-consumer, and of hotel clients in particular. What could the hotelier’s responsibility be with respect to his spied-on client whose information he voluntarily – or not – provided to feed databases? Will this client be allowed to attack the hotel for invasion of privacy?

For how long will hoteliers accept the harvesting of their information that constituted the wealth of their business? When they open their PMS, they accept the risk of losing some of their property’s value. Recently booking sites have recommended another nearby property to clients during the reservation process. The spread of geographic positioning adds an additional threat.

Moreover, we have recently seen in the news that it is also relatively simple for a commando of determined hackers to get into the computers and data bases of the biggest networks. Between the intentional use of information about clientele to pinpoint their personality and make enticing offers to them, and the risk of violating their private universe, one might be right to fear a veritable virtual aggression that is equivalent a home invasion.

Internet users are beginning to be concerned, and are becoming aware of how the information trail they leave behind them at each site they visit is used. The code of ethics, the rigor of the methodology, the transparency of samplings are all neglected to the benefit of turning data to profit.

Hotel informatics remained limited to management and finance and did not join the marketing movement at the right moment. Marketing teams are also guilty of being slow to understand the importance of customer data management to shift to tailor-made stays and to maintain a permanent and personalized connection. The risk is that other actors will develop the tools necessary for exploiting the information. After losing much of the online distribution battle and letting a large share of the contents of their CRM leak out, perhaps hoteliers have learned not to lose control over marketing and will resume product innovation.

About Georges Panayotis

Georges Panayotis is President of MKG Consulting. Born in a family of hoteliers for three generations, Georges Panayotis, 51, left Greece at the age of 18 to pursue his studies in Political Sciences and to obtain his Master in Management at the French University of Paris Dauphine. He then joined the Novotel chain, which will become the Accor Group, to manage the International Marketing Division. After developing specific marketing tools for the hotel industry, he left the group in 1986 to start his own company, MKG Conseil, now MKG Group. In twenty years, the group has become the European leader in studies and consulting for the Hospitality industry. The company employs over 70 people in four departments: marketing studies, database, quality control and trade press, with two publications HTR Magazine and Hotel Restaurant Weekly. The company helped the development of over 2,000 hotels in France and in Europe, with offices in Paris, Cyprus and London. Georges Panyotis is the founder of the Worldwide Hospitality Awards and the Hotel Makers Forum, and the author of several publications on Marketing and Operations in the hotel business, He is a regular consultant for several television channels, among which Bloomberg Television, and radio networks.

Contact: Georges Panayotis

g.panayotis@mkg-group.com

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