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HSMAI Foundation Releases Findings of Second Resort Best Practices Study on Customer Relationship Management and Loyality

  • 07.27.06
As a follow up to its hugely successful comprehensive study on Internet marketing and distribution, the HSMAI Resort Marketing Special Interest Group (SIG) has completed its second intensive initiative, this one on customer relationship management (CRM) and customer loyalty.

Customer expectations, demand for control, the power of perception and declining loyalty were among the hot issues addressed in the revealing study that tracks one of the most important issues for resort marketers today.

Among the most valuable and applicable aspects of the report are “Eight Building Blocks” along with 35 examples in the form of best practices specifically for resorts to illustrate how each can be deployed.  They are:

  • Customer Data
  • Customer Profiling
  • Service Experience
  • Group Sales & Call Center Applications
  • Loyalty & Retention
  • Direct Marketing
  • Interactive Dialogue
  • Keeping Score

“Rather than focus on what is not done, though, it is far better for each resort to set its sights on what it can do and slowly, gradually construct the foundation with each building block, one at a time until the structure is able to deliver on the CRM promise,” said Cindy Estis Green, managing partner, The Estis Group, and author of the report.

Specifically, the report offers a series of recommendations for those looking to embrace CRM more fully.  It offers in-depth explanations and actions, steps, goals and objectives on important issues such as:

  • The internal audit process
  • Establishing realistic goals and timeframes
  • Setting priorities
  • Getting the data right
  • Not getting hung up on the technology
  • Staying current on CRM techniques

“This initiative provides an ongoing opportunity to move our industry forward as we continue to explore ways to capture valuable information from our guests beginning with the initial purchase through their time at the resort and beyond the visit,” said Barry Brown, director of sales and marketing, Sanibel Harbour Resort & Spa, and chairman of Best Practices, HSMAI Resort Marketing Special Interest Group.

“The intent of these reports is to hone in on a topic that is critical to hospitality and travel marketers and use the best resources available to present a thorough, well-researched and informative study that will be an influential tool for success,” said Robert A. Gilbert, CHME, CHA, president and CEO of HSMAI.

Additionally, among the findings pertaining to “Marketplace Trends: CRM and Customer Loyalty” are as follows:
(1) Consumer Sophistication - Consumers are bombarded with information constantly.  They also seek out information now that it’s become more readily available through online venues.  They are generally more aware of travel choices and they know how and where to find out more.  They expect to be treated as knowledgably as they feel they are and they don’t want to find they know more than a customer contact agent about a product or service they may want to buy.
(2) Demand for Control - Consumers don’t expect to find limited timeframes for asking questions, solving problems, making a purchase or revising a purchase.  They want to use a telephone, PC, PDA, cell phone or visit a bricks and mortar location representing a company with which they interact.  They want to have all questions answered, they want autonomy to customize their purchase to meet their needs, and they may also want to have their communication customized.
(3) Proliferation of Options - The number of choices for many products and services seems to have expanded exponentially.  Part of this perception is that information on all products and services is so much more accessible through online channels that the number appears to have grown.  It could be that the number of options any one customer can learn about is much greater, even if the absolute number may not have grown as much as it seems.  Either way, the perception is what the consumer is responding to, and it is this perception that a hospitality marketer has to address.
(4) Declining Loyalty - Perhaps in response to the plethora of choices, perhaps a function of the fast moving information flow in which we make decisions, a consumer’s loyalty is declining.  Forrester cites a marked decline in loyalty amongst U.S. hotel bookers over the last three years of tracking.  Consumers are seeking new and interesting experiences, they know they can search for better values for any hospitality product and it all adds up to a weakening in the relationships between hotel and guest.

The study was conducted through two primary sources: extensive interviews with participating resort executives and their vendors, and secondary research of CRM and loyalty practices both within and outside of hospitality.

Almost all resorts surveyed described their CRM focus in terms of on-site customer service.  Their marketing tools were viewed as a separate function (only some saw their databases and direct marketing as elements of a CRM strategy) and finance/accounting was rarely mentioned, if at all.

CRM may include a range of applications, from loyalty/retention and sales programs, to product optimization, to name a few.  These applications may require strong technical support or they may be procedures developed and delivered by customer-oriented staff.  They can be highly structured or they may be intended to create an emotional connection to a customer.  When done right, they will do all of these things.  Management will dynamically direct the team to continue to evolve in response to customer requirements as needed, whether it’s to improve operations, finance or sales and marketing.

The Resort Best Practices Initiative participants were: Atlantis, Paradise Island, The Breakers, The Broadmoor, Colonial Williamsburg, El Cid, The Greenbrier, Hershey Resorts, The Homestead, Hyatt Hill Country, Kiawah Island Golf Resort, Mauna Lani Resort, Oglebay Resort, Outrigger Resorts, Pinehurst, The Reefs, The Sagamore, Sanibel Harbour Resort & Spa, South Seas, Steamboat Resort and Ski Company, Turtle Bay Resort, Watercolor Inn and Resort, Westin Kierland Resort and Wild Dunes.

While the full report is available to sponsors and will be on sale to the public after May 7, 2007, the fall issue of HSMAI’s Marketing Review will publish an executive summary. 


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