Mr. Albarran

Guest Service / Customer Experience Mgmt

Comparing Your Service Levels Against Your Competitor's

By Marco Albarran, Founder & President, Remarkable Hospitality, Inc.

As we have been moving through a rough economical situation, we have experienced sluggish growth in ADR, with slight growth in Occupancy Percentages overall. Indicators, as well as recent conversations with hospitality leaders suggest that we will not see 2007 numbers for a few more years (the best case scenario would be two more years), yet, we are starting to see the light at the end of the tunnel, as we cautiously move forward. Many markets are still at a standstill when it comes to new supply (hotels or restaurants entering the market), so no concerns over new competitors should be of major headaches at the moment. This is, in one way, a great opportunity for existing establishments to focus more on working on their service levels as well as their service cultures. The reality of the hospitality market is that it is still under a lot of distress, so this affects the bottom line of any hospitality-based business, naturally. That said, hospitality companies should be focusing on improving its own product, tangible and intangible services, and should also be consistently aware of what the existing competitor is doing as well. Sure, we can always study STAR reports or see how our competitive brands are doing and where our positioning in the market is, for example, yet at the end of the day, what is it that the guys next door are doing, that is either bringing them customers or scaring them away?

There are fundamental service factors that we may have to keep into consideration that we want to ensure that we are, at minimum, up to par with this consistently. For example, the hotel industry lists safety, comfort and security as their main baseline for a viable service model/fundamental service factors.

Based on your property’s segment, positioning and brand, you should always make the time to look into what minimum fundamentals are needed to always meet and be classified as this. There should be an understanding of this as the establishment wants to perform at a service level in which is mostly viewed as from a customer perspective. For example, if the hospitality establishment is an upper-upscale property, or a fine-dining establishment, rated at perhaps four stars or diamonds, they should do not want to attempt to go above or beyond that. You will lose customers because you will set incorrect expectations that will surely show off in customer reviews and now days, in social media sites.

Understand who your competitors are within the brand in which you are operating. For example, in lodging, Smith Travel Research develops a lodging list which classifies most well-known brands, under their respective segment categories. This should be used as a macro/initial tool to determine where your brand falls under and also, first and foremost who your competition is.

Conducting an overview of the local market (typically somewhere along the line of 5-8 miles radius) is an important concept to do as well. Keep in mind that anything beyond this radius may actually be another market which will not have anything to do with the customers you may serve. In markets that may be broader, such as in rural areas like the Caribbean or Central America, may have to do a more extensive study to further understand who may fall into their competitive set, perhaps looking into similar markets in similar islands.

Having identified both the market and the brands in your establishment’s area, it is important to identify direct versus indirect competitors. Typically, a market should exemplify anywhere from 2-4 primary competitors, as well as any secondary competitors. Once this information is established, there will be a good sense of how to commence to understand who we should measure ourselves against in our local area. Always keep in mind that the consumer is the ultimate decision-maker on this as well, and price tends to be a strong motivator, however, quality and value will trump this overall.

With all of this research conducted, it is always important to have a sense of important factors such as how the market is doing rate wise and occupancy wise. Again, we mention these, as these are key factors that will be strongly related to how we can position ourselves. It is reasonable to place rates based on how brands compete in a typical market, yet, sometimes, due to certain demand or economic situations, we may see that we have to strategize and perhaps compete with the secondary competitor.

Typically, the guest in this market favors price and perception of quality, as part of their overall perception of value for where they choose to stay. If this is the case, we need to certainly have outstanding customer service in place in order to retain them.

Brands have also an opportunity (over independent operations) to see how they rank in customer service against each other in a regional basis, for example (for instance a Holiday Inn in West palm beach versus the one in Ft. Lauderdale, and so on). We can review internally how an establishment is positioned from a guest service standpoint, by seeing regional guest service reports. If one is well aware of these reports, have we ever wondered what are reasons why we continuously rank say, number 3 or number 2, and never number one? Why is it that there is a number one consistently scoring over 90%? What is their secret? Let’s see what we can do in order to find out more:

There will be many ways in which we may seek out certain information from the competitor. It is recommended that perhaps listening to what guests have to say of the competition may help, as to what they did correctly and incorrectly. This is great market information. Also, having the opportunity to see what folks post on social media websites tends to be very effective as well. Although we start the approach strongly, we are not getting a full vision of the total service market painting. There are other items that we should also do. We can also connect with management of the competition at local chamber of commerce meetings and share some ideas, as well as carefully listening to what they are offering at their hotel. Additionally, we can always see what they do in their personal Facebook or Twitter pages should they manage one consistently. What else can we do?

A good sense of gathering an experience of what the competition may also do is to truly have an experience from their operations. We are referring to going through the competitor’s overall reservations experience, the arrival experience from the time we arrive, interaction with the staff initially (feeling and understanding the first impression impact), as well as seeing the overall check in process. The room experience should also be tested and given the type of lodging facility; one should also test amenities, F&B outlets, recreational facilities and social gathering, such as manager hours and also continental breakfasts. Restaurants can certainly seek out similar approaches, from making reservations, the host area experience, seating, cleanliness and full attention of the establishment’s staff, knowledge and sense of urgency.

What should be created is a particular checklist that mainly mirrors what your establishment can be doing to improve the overall service experience. The overall point of this is not to truly conduct a quality evaluation or mystery shop. The main goal is to see why the target audience of a particular market where you may have a hotel/restaurant or any other hospitality entity prefers to patron them and what you as a competitor need to do (service–wise) to capture that audience next time and hopefully in a loyal manner. We are not looking to “spy” on the competition, or “steal” a patron from another area, yet it is reasonable to mention that this particular activity would be a good opportunity and small investment to learn more about the market and how the establishment we own or manage can be always in the number one of number two ranking in a consistent manner. This should also prompt your property and managers to always realize what you can offer your customers that your competitors don't.

The overall question and decision is up to the operator as to how to approach this. Keep in mind that we are dealing with service fundamentals that always have been in play, yet the overall concept is to innovate. Once you have successfully done this, you will certainly understand how to be ahead of the game. You can ask yourself the following question and determine what best works for you as well: Can this study be done by an employee, and would they be noticed immediately, or should this be conducted by a third party outsider with a true understanding of the local market, or at least the understanding of how to learn the market in a manner in which can deliver the proper information that the establishment needs to gather?

At the end of the day, conducting a consistent study like this works to your establishment’s advantage. Your establishment will also have the talented staff its needs to succeed. The study should be conducted consistently and certainly in a customized manner. Always develop a proper guideline which will assist you capture proper information that will be vital in positioning your establishment in a better place.

Marco Albarran is the founder and president of Remarkable Hospitality, Inc., an international consulting, training and educational firm that specializes in assisting hospitality companies to perform successfully by developing and continuously improving service standards. He also serves as a hospitality instructor and subject matter expert for various universities. Before launching Remarkable Hospitality, Inc., Mr. Albarran was with HVS International, working on national and international consulting projects, including market and feasibility studies for proposed and existing lodging facilities. Mr. Albarran can be contacted at 561-542-6326 or malbarran@remarkablehospitality.com Extended Bio...

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