Mr. Verma

Social Media & PR

Social Media: Meeting the Guest (More than) Halfway

By Rohit Verma, Executive Director, Cornell Center for Hospitality Research

Co-authored by Glenn Withiam, Executive Editor, Cornell Hospitality Quarterly

Social media are here to stay, and hospitality industry operators and executives must find ways to engage their guests via social media, even if the specific applications change over time. Social media offer a tremendous opportunity for staying in greater touch with customers, strengthening brands, and improving sales. The key is to respond appropriately to guest comments and requests in social media forums, that is, to meet the guest at least halfway.

A study recently conducted by the Center for Hospitality Research (CHR) examined the current preferences and usage of the internet and social media for travel searches by some 2,830 business and leisure guests in the United States. Going forward, the study should be expanded beyond U.S. borders, but we believe that this gives a reasonable representation of customers’ general use of social media. If you would like to read the study for yourself, it’s available at no charge from the CHR (chr.cornell.edu): “How Travelers Use Online and Social Media Channels to Make Hotel-choice Decisions,” by Laura McCarthy, Debra Stock, and Rohit Verma.

One key finding stood out. The study found a dividing line between the way business travelers search for hotels and the leisure travelers’ search. Business travelers are most likely to choose a hotel that is recommended they their company. Beyond that, however, many of business travelers use search engines or online travel agents for their hotel search. Leisure travelers said that personal recommendations from friends and families is still their chief source of information, followed by travel-related websites, search engines, and OTAs.

Looking at those findings, you may be wondering what happened to social media. The answer seems to be that once both business and leisure travelers have gathered information about potential hotels, both groups of travelers use the internet and social media to make a booking decision. This includes visiting the brand website, OTAs, and TripAdvisor. Late in the decision process, the respondents tended to land on the brand websites or go to an OTA, where they can book their room.

As you can see, even though corporate recommendations figure strongly in business travelers’ information gathering, and though leisure travelers still listen to their family and friends, the internet figures heavily in travelers’ booking decisions. The use of social media for information gathering and booking decisions can only expand. At the same time, the hotel industry’s presence on the social media presents at best a mixed picture. Speaking at the 2010 Cornell Hospitality Research Summit (CHRS), Peter O’Connor, professor of information systems management at the Essec Business School, highlighted both the danger and opportunity inherent in social media. As a starting point, O’Connor pointed out that people are always talking about the hotel industry—an assertion supported by the Cornell study that we just discussed. Much of that conversation has moved to the internet, and he estimates that well over two-thirds of internet content will be created by consumers and users within the next three years.

His summer 2010 analysis of the hotel industry’s presence on top social media outlets shows that the hotel industry has the opportunity to do much more with social media. Looking at Facebook, Flickr, Twitter, and YouTube, O’Connor found that seven of the top 50 hotel brands could not be found at all on those four sites. On the other hand, several brands are well represented on several of those sites. He found that Marriott has large presence on Twitter, for instance, Hyatt Regency recorded the most activity, and Holiday Inn had the most “likes” on Facebook. He concluded that Best Western has the strongest social media presence overall, as judged by its consistency across the channels, followed by Hilton and Marriott. Perhaps most telling, O’Connor found that many chains’ presence seems to waver. Some chains jump into a channel, he found, but then fail to maintain a presence. O’Connor concluded by suggesting that It is critical for the hotel industry to change how it sells to consumers.

Reinforcing O’Connor’s point about consumers’ participation in social media, Lorraine Sileo, vice president of research at PhoCusWright, reported that 600 million people (equal to 10 percent of the world’s population) is on Facebook. More to the point, she added that 66 percent of travelers are on Facebook, and Facebook referrals are far more likely to convert into bookings than are referrals from travel review sites. These are reasons that hotels should make themselves as visible as possible on social media sites. So far, she concluded, the social media statistics apply mostly to leisure travelers or to business travelers who are arranging their own itineraries, a finding that is reflected in the study we presented at the beginning of this article. As a concluding point, she noted that 90 percent of her survey respondents aged 18 to 24 said they are on Facebook.

In addition to building a relationship with your guests, the internet and social media allow hotel operators to gain valuable consumer and market analysis. In another CHRS presentation, Stuart Greif, vice president and general manager of global travel and hospitality practice for J.D. Power and Associates, pointed to the extensive information that customers share on the web. Based on J.D. Power and Associates’ Web Intelligence capabilities, Greif suggested the hospitality marketers think of social media and internet commentaries as a focus group comprising millions of travelers.

To understand the context of consumers’ comments, an analyst can simply note the number of conversations about a particular topic. The trick, he said, is to get through the buzz into a deeper level of analysis. This can include consumer analysis, brand and product analysis, market and trend analysis, and innovation analysis. Consumer analysis allows marketers and operators to better understand consumers’ behavior, including where they like to stay. Brand and product analysis analyzes customers’ comments about specific brands. For this, Greif suggested that hotels target customers and focus on their views. For market and trend analysis, hoteliers can gain information needed to understand guests’ feelings regarding what they like and dislike about a particular hotel or practice. Finally, innovation analysis allows operators to see what is new. For example, one trend is that travelers can now just pick up their mobile device and go, rather than planning and booking in advance. Because of that trend, Greif suggested that hospitality operators need to invest in mobile apps and determine how to expand services offered online.

Although customers do use social media to find hotels for booking rooms, social media sites are also useful for monitoring a brand and driving traffic to a hotel’s website. Anil Aggarwal, CEO of Milestone, suggested that hotel operators must connect with guests on the five types of internet sites that they use. Those are brand sites (including Starwood and InterContinental Hotel Group apps), search engines (notably, Google, Bing, and Yahoo), email in response to promotions for deals and gateways, travel sites (such as TripAdvisor), and social media (most particularly Facebook).

One important step that hotels can take with social media is to participate as an information provider. Properly done, this will drive traffic to the hotel’s website. He emphasized that the content must be useful. Merely offering promotions is insufficient, and perhaps will turn off potential guests. Aggarwal said that a hotel could offer tips of the day, restaurant suggestions, local weather, insider tips, and deals that emphasize value. Ramada, for one, built a Facebook quiz that allowed users to determine which of its brands fits their personality. That increased Ramada’s web traffic by 300 percent. A hotel in Hawaii earned a great response by posting the “Top ten things that only locals know,” and another Hawaiian hotel posted a Flickr album for “SurferBeachHotels,” which received 28,000 views. The hotel simply posted its pictures online and used a good descriptor.

Other examples of international hospitality chains’ approaches to social media include Hilton Worldwide. As explained by Kevin Jacobs, Hilton’s senior vice president for corporate strategy and treasurer, over 80 percent of guests travel with a mobile device and 40 percent use it to search travel. So, mobile apps make sense. Hilton’s mobile apps have seen more than 340,000 downloads and guests used them to book well over 100,000 room-nights in 2010, with revenue up 200 percent.

McDonald’s is another firm that is making heavy use of social media. According to Steve Levigne, vice president, U.S. strategy and insights, McDonald’s started its social media strategy almost two years ago, partly in recognition that McDonald’s has lots of buzz. The McDonald’s Facebook page has 3.1 million fans, and its Twitter account has over 50,000 followers. This allows McDonald’s to engage its customers and integrate customer insights into its brand. McDonald’s invites customers to participate in discussions about satisfaction and about new concepts that it is considering for chain-wide rollout.

Another firm that engages is customers is Royal Caribbean International, as explained by Adam Goldstein, CEO and president. RCI’s comprehensive approach to building relationships includes social media interactions that figure heavily in the engagement process, particularly with loyal guests. Among other practices, RCI monitors guest emails, corrects issues as quickly as possible, and then responds to the guest with the disposition of any problems. Goldstein maintains his own blog, although some customers are incredulous that the CEO would take the time to do such a thing. (One thread involved a debate regarding whether Goldstein himself writes his blog. He does.) In addition, RCI has posted YouTube videos, called webisodes, of its new flagship, Oasis of the Seas, which have recorded over 700,000 hits. This level of engagement allows loyal customers to go beyond advocating for the brand so that they participate in developing the brand.

In conclusion, the examples presented here are intended to give you a sample of ideas for ways that your operation can engage guests using social media. Most critically, the interaction must fit your brand and be genuine. No matter what the medium, hypocrisy and insincerity are quickly exposed. So, although Professor O’Connor was surprised that seven of the top 50 world hotel chains were not represented on social media, that decision not to participate may make sense, if those chains have not yet determined an appropriate message. Eventually they, too, will find a way to establish their presence. With careful consideration of their customers, every firm can engage their guests to enhance their loyalty and eventually build a group of advocates for their brand.

This article was co-authored by Glenn Withiam. Mr. Withiam is a graduate of Cornell University, and is executive editor of the Cornell Hospitality Quarterly (CQ) as well as director of publications for the Cornell Center for Hospitality Research (CHR). In addition to producing the CQ and numerous reports, Mr. Withiam has edited books on hotel management contracts, internal control, hospitality training, quality service, and the forthcoming Cornell School of Hotel Administration on Hospitality: Cutting Edge Thinking and Practice, published by John Wiley and Sons.

Rohit Verma, Ph.D., is Professor of Operations Management and Executive Director for The Cornell Center for Hospitality Research. Prior to joining Cornell faculty, Mr. Verma was the George Eccles Professor of Management, David Eccles School of Business at the University of Utah. He has also taught MBA and executive development classes at several universities around the world including DePaul University, Chicago, IL, University of Sydney, Australia, Norwegian School of Logistics, Norway, Helsinki School of Economics, Finland, and Indian School of Business, India. Mr. Verma can be contacted at 607-255-2688 or rv54@cornell.edu Extended Bio...

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