How Social Media will Change Hospitality Compensation Plans

By Michelle Wohl VP of Marketing & Client Services, Revinate | February 10, 2013

On a recent trip to San Diego, I noticed that the hotel I had booked did everything it could to alert me to its social media presence. The pre-stay email encouraged me to follow the hotel on Twitter and Facebook before my arrival to stay abreast of the upcoming goings-on at the hotel and in the local area. When I got to the property, there was a pop-up card at the check-in desk with the hotel's Twitter handle and Facebook page address and one in the guest room as well. This marketing piece encouraged me to share my experiences and get help and information regardless of where I was - - on property or out on the town.

As I stood in line to check-in, I fired off a tweet announcing my arrival and almost immediately I heard back from the hotel. The hotel's tweet welcomed me to the hotel and encouraged me to tweet back should I have any questions or need any assistance. Traditionally, guests have been encouraged to visit the front desk or the concierge for service issues or assistance but this particular hotel understood the changing behavior of many customers and made sure that staff was available, at virtually any time, on all the networks where guests might reach out.

After a great visit to the spa later that day, my masseuse gave me a TripAdvisor card as she said goodbye and encouraged me to write a review about the service. I received another TripAdvisor card from the woman at the front desk when I checked out of the hotel and let her know that I enjoyed my stay. When I got home and opened the post-stay email from the hotel, I was provided with a link to the online review site and encouraged, again, to review the hotel publicly.

From the coordination of these messages and the speed of the hotel's response on Twitter and on TripAdvisor, it was obvious that this particular hotel had embraced social media and staffed appropriately. I reached out to the General Manager to understand how and why he shifted resources to staff for social media and wasn't too surprised to learn that although he is a firm believer in the power of reviews to drive business and social media to 'surprise and delight' connected guests, the biggest driver was the management company who believed so much in the power of user generated comments and social media to influence bookings, that they were starting to reward employees based on the success of the hotel on online review sites and social networks. Hotels in the portfolio that adapt quickly have a lot to gain as bonuses and compensation packages take social metrics into account.

Traditionally, management compensation packages have been based on factors such as market share, financial performance, traditional comment cards or guest satisfaction surveys and staff satisfaction. But what these measurements fail to account for are the factors that are driving real booking decisions today, in the age of the connected traveler, such as TripAdvisor's Popularity Index, online review ratings, management response rates and social media engagement.

Why have social metrics become so critical to management that leaders in hospitality are changing bonus structures to include them? First, the ROI around social media is no longer as elusive as it once was. Many great minds have been studying the effects of social media marketing and the power of online reviews and all signs point to the fact that both make great business sense for the hospitality industry. Bain and Company, for example, recently reported that customers who engage with companies over social media are more loyal and they spend 20 percent to 40 percent more with those companies than other customers do. And Market Metrix has been reporting on the shifting factors that go into consumer booking decisions. Whereas location and price used to be the top factors in booking decisions, online reviews and recommendations are now at the top of the list. Great engagement on social media can drive great benefits for hotels.

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