How to Utilize Feedback Information to Secure Repeat Customers
By Richard D. Hanks, Chairman and President, Mindshare Technologies
Chances are you're familiar with early 20th-century Italian economist Vilfredo Federico Damaso Pareto. Doesn't sound too familiar? Perhaps the "Pareto Principle" rings a bell?
Maybe you recognize it as the "80/20 rule." Pareto discovered that 80 percent of the land in Italy was owned by 20 percent of the population. That ratio seemed to manifest itself in other areas too, and today is widely adopted by businesses as a rule of thumb in many areas. For example, more often than not, roughly 80 percent of your sales will come from 20 percent of your client base.
For the lodging industry, this is a critical rule. Your loyal customers will look for your brand in every city they visit. If you really treat them right, they will go out of their way to find your hotel, even if it's in an inconvenient location.
The random, one-time transient guest is certainly critical, and a strong way to improve REVPAR is to put heads in beds. But, getting them to return over and over again is the best way to increase long-term profits.
The question then is: what turns a one-night resident into a frequent guest? You may think you have the answer within your existing operations - nice beds, clean rooms, friendly staff, tasty menu, etc. These are all important, but there may be something else your guests are looking for, something more subtle. Find out what that is, and they'll keep coming back.
Acquiring Customer Opinions
Your customers hold the key to your success in their opinions. No matter what improvements you make, if it isn't what they're looking for, it's for naught. Over my many years as a senior executive in the lodging business, I have witnessed numerous innovative lodging programs searching for a customer sponsor. This of course, is backwards. It's the customer need that should drive our response.
The truth is it's fairly simple and inexpensive to acquire customer feedback. Automated systems are a major improvement over comment cards or verbal surveys, because they give the customer a private forum in which to express their likes and dislikes. By offering a reward - such as frequency points, a small discount, or a chance to win a free stay - all of your guests have incentive to offer feedback, not just the disgruntled ones.
A great benefit of implementing automated feedback is the chance to create a database of responses that can, in turn, be used to discover commonalities and trends. It's not cryptic - what your customers enjoy and/or want to see improved is made obvious in graphs and charts. You don't need to be an expert in CRM technology to understand exactly what your customers are thinking and what trends are developing.
The best benefit of automated feedback is the ability to access responses in real-time and act accordingly. Instead of waiting for information to be compiled and processed, you can immediately walk over to your clerk and tell her that the customers think she's doing a fantastic job, or get a repairman to fix a leaky faucet pronto. Some systems will let you create alerts that will notify you instantly to certain customer responses, so you can take action at once.
Give Them What They Want
With your feedback data in hand, the things you need to do to create repeat customers will be obvious. As mentioned before, their answers will be illustrated in easy to read charts and graphs. Regardless of the type of feedback received, you need to be ready to act upon what your customers are saying.
It could be long-term negative feedback that you need to improve on. You're probably aware of equipment deficiencies such as squeaky beds or loud air-conditioners. These you can be made aware of immediately, but some other problems may not reveal themselves until you can see them mapped out over the course of a week or even a year. Either way, you're going to be aware of every issue guests have with your hotel, and will be able to make things right. After all, if you don't fix a customer's complaint, there's no chance of making them one of your loyalists.
The fact is, that "20 percent" will consider your hotel a second home and will expect to feel as such when in your premises. This is where automated feedback can really come in handy, as this emotion typically doesn't revolve around obvious improvements like soft beds or cable television. While a comment card may reveal that the customer felt your staff wasn't friendly enough, a deeper probe into their thoughts may reveal the customer didn't feel at home because there weren't smiles or the staff didn't address him/her by name. Something that may seem so trivial could be critical for earning repeat business.
Emphasize the Positive
Positive feedback reveals your strengths and what you need to continue to emphasize. These responses are just as important as negative feedback because you'll get a clear picture of what separates you from competitors in the customer's mind, and in turn you can make sure every guest has the same experience.
Sometimes they've already fallen in love with your hotel, but just want to be rewarded for their loyalty. Create a rewards program that gives back to them for their loyalty. It'll help you build a database and make it simple to discover who your "20 percent" are. Plus, consumer buying patterns have consistently shown that they will spend more if there are rewards after certain milestones.
Besides helping retain your current customers, acting on positive responses is a great way to keep staff and increase morale. In turn, negative feedback lets you pinpoint exactly where more training is needed, or when you may need to take immediate punitive action against a staff member.
Put the Information to Work
Earning repeat business is not easy. In truth, making improvements and reiterating best practices requires a daily commitment to each and every customer and their feelings. You may discover a need to revamp your training practices, or your food and beverage service. These are the types of decisions not easily instituted by hotels. But if your customers demand it, you need to do it. If you don't, they'll find somewhere else to spend their business trips and vacations.
The key to earning repeat business is communicating with your customers. Fortunately, this is the easy part. Modern technology (combined with a little incentive) makes gathering and sorting responses from customers simple and affordable. You won't have to waste time guessing what some hand-written note on the back of a comment card means. Some of these automated feedback systems also offer respondents the chance to leave a verbal comment, which n my experience are some of the most revealing parts of the surveys.
You'll have an army of information at your fingertips, clear as day. You'll know exactly what you need to do get a robust amount of "20-percenters" occupying your rooms and driving up your revenues and profits. After all, to get them coming back again and again is as simple as giving them what they want.
Richard D. Hanks is President of Mindshare Technologies. Mr. Hanks has been a senior executive of several Fortune 500 companies and several start-up ventures. He is on boards of corporations, universities, and foundations. His experience spans multiple industries and disciplines, including as an adjunct professor at Cornell. He is a teacher/speaker at trade, academic, and professional gatherings. He is also the author of "Delivering and Measuring Customer Service". He obtained his bachelor's degree from Brigham Young University and his MBA from Northwestern University. Mr. Hanks can be contacted at 801-263-2333 or firstname.lastname@example.org Extended Bio...
HotelExecutive.com retains the copyright to the articles published in the Hotel Business Review. Articles cannot be republished without prior written consent by HotelExecutive.com.