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Pick a Card, Any Card, from the CRM Desk

Pick a Card, Any Card, from the CRM Desk

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October 25, 2017
Customer | Relationship Management
Mark Haley

©2017 Hospitality Upgrade
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Get 10 colleagues and business associates in a room and ask them each, 
“What does CRM mean to you?” 
We’ve done it, and can tell you that you will get at least 15 answers from your 10 friends, if not more.  
Prism’s view of the manifold aspects of CRM is that it isn’t a thing. Rather it’s a collection of strategies – and tactics within those strategies – that a hotel company (or other marketer) can use to achieve its business objectives. 
Much like a deck of playing cards has four suits, the CRM portfolio has several broad key strategies. How you put them to work for you depends on the type of relationship you want to build with your guests and how you intend to do it.  
Consider the strategic "suits" in the graphic to the right. That’s not to say there aren’t additional strategies you can use, but these are a fine place to begin. These are the four you most need for success. Most products in the marketplace can and do support multiple strategy suits, but a loyalty program without profile management isn’t going to go very far. E-marketing needs powerful analytics to improve and to truly measure what you’re getting for your efforts.
The dispersal of profiles across many systems in the hospitality industry makes it harder to maintain a single, complete, and accurate view of the guest. Each system (think CRS, multiple PMSs, multiple spa systems and more) stores its own profiles. The result: a fragmented picture of the guest’s activities within the hotel enterprise.  
The ace in this suit is probably the technology and business processes that let you quickly and accurately merge duplicate profiles into a single customer view. “What we have been hearing from our customers and the broader market is the need for a solution that provides highly accurate guest profile deduplication at scale,” said Rich Matthes, product strategist with Amadeus Hospitality. “A human being can do this manually but not at the speed and scale required.”  
Some of these tools are fully automated. But that comes with a somewhat higher risk of making a merge error. Other products offer semi-automated options. They identify probable matches and send them to a human operator. She determines which profile wins and if a losing profile gets merged into it -- or not. This approach takes longer and requires costly labor. It can also lead to a sort of death spiral: As the number of duplicates grows, the effort to find an existing profile and use it for the next booking becomes too great. Instead, the user creates another dupe profile. 
Some systems blend the two approaches, using auto-merge on very strong matches. Weaker matches are flagged and sent to an agent.
Another high-ranking card in the profile management suit is the ability to send the cleansed and de-duplicated (often called householded) profiles back out to hotels for enhanced guest recognition and service delivery. Other cards in the suit include address standardization, address verification and more. 
It can help to distinguish between transactional emails (confirmations, cancellations, thank-yous and survey invitations) and marketing campaign emails that promote a special offer for a soft date or special event.  
Most property management systems (PMS) and central reservations systems (CRS) can send confirmations. But today’s hoteliers have access to a healthy, competitive market of specialist email service providers. It offers robust interfaces to source PMS and CRS systems. Data captured from the source system to generate transactional emails can be stored, standardized, de-duplicated and combined with other details to create a rich profile database.  
This information can help you select guests most likely to respond to an offer. Someone that came on a golf package would probably be receptive to a great offer for off-season golf. Or you could query for “All guests that booked a leisure rate on a January or February weekend in Boston in the last three years” and try to entice them to come back and enjoy the hotel’s indoor pool and its restaurants. The ability to create and exploit this database for marketing campaigns makes the transactional email capability important not just to the suit, but to the whole deck.
More and more hoteliers are broadening their definition of e-marketing to include more than just email. They’re looking for vehicles that will let them interact using whatever channel the guest is most comfortable with. In addition to traditional email, these multi-channel conversations might take place using chat on the brand.com website, WeChat, WhatsApp, Facebook Messenger or other media the guest prefers.
“In today’s global marketplace, local preferences and localization are more important than ever before,” said Kristin Ruble, vice president of consumer marketing at Mandarin Oriental Hotel Group. “If a Chinese guest wishes to interact with Mandarin Oriental using WeChat, and the guest from the UAE prefers to use WhatsApp, then we recognize the need to be able speak with her in the channel and language she prefers.” 
Other aspects of e-marketing probably fall outside the scope of this article. These might include search engine optimization, search engine marketing, pay-per click and re-targeting strategies. 
Guests earn points for stays, often while traveling on business at an employer’s expense. But they can come back on their own time and redeem (or burn) them for free nights. 
As these programs have evolved, other earning opportunities have come to market. In addition to partnership agreements, loyalty program credit cards are also popular. These typically offer points for all money spent on the card, plus a bonus for spending with the hotel company. There may be soft benefits as well. Other redemption options now typically include upgrades, merchandise, gift cards, exchanges with other programs and more. Guests respond well to programs that let them to choose what specific benefits or rewards they receive.
Currently, one big trend among points-based loyalty programs is to simplify redemptions and make them more immediately available and achievable. Guests no longer have to acquire 20,000 points for a free night. Now they can use 10,000 points plus $100 cash to get a $200 room.  
Points-based programs work well for hotel companies with many locations for earning and many popular destinations for burning. Think resort or destination cities like New York or San Francisco. Companies that don’t have extensive resort locations often partner with those that do. For example, Choice Privileges members can redeem points for free stays at Bluegreen Vacations Resorts’ network of properties.
Smaller hotel companies without the vast network of locations often apply a different approach to loyalty. They may play down the points or do without them altogether. Marketers often call these guest recognition or guest engagement programs. Rather than using reward points to drive repeat visits, they capture guest preferences and use them to enhance the visit. These are sometimes stealth initiatives, where the guest doesn’t know he’s in a program and being ranked and rated. He only know he gets recognized at the hotel and his preferences are confirmed and fulfilled. An occasional element of surprise and delight amenities keeps him coming back for more.
Some property management systems have remarkably capable loyalty programs available as an add-on module. These include Maestro PMS from Northwind and Oracle Hospitality’s Opera. Other providers will also market loyalty modules to brands and properties, including Guestware, Cendyn and coming soon, Digital Alchemy.
Loyalty programs, especially points-based models, are expensive. Tracking points requires significant accounting effort. They become a large weight on the balance sheet. This is why they expire. It also helps make the business case for more and simpler redemptions.
How much incremental revenue do your initiatives add?  Which strategies pay off more than others? What promotions generate more bookings? If you aren’t measuring, you aren’t marketing.
Some service providers, like Datavision, are built on robust BI platforms and come out of the box with these capabilities. Digital Alchemy and Clairvoyix offer flexible reporting and analysis tools. Cendyn with Cognos and Infor with Birst integrate horizontal BI tools to leverage those analytical capabilities. 
Operational excellence involves numerous carefully crafted policies and procedures all leveraging guest insight. The goal is to recognize patrons and provide them with a level of service that equals or exceeds the brand’s value promise. It takes a great deal of effort and expense to gather a guest’s personal, booking and spend data in the first place. Then hotels must send it (mostly for marketing purposes) from transactional systems like PMS to the CRM where it’s deduped and cleansed. It gets scrutinized for quality and completeness, and enriched with demographic and psychographic overlays. However, only rarely is the resulting perfected, enriched, ranked, insightful and a single view of the guest fully returned for operational use to those same transactional systems. Technology just isn’t set up for it.
In fairness, the tricky part has been lack of a timely way to share that data with the hotel’s points-of-service delivery systems, like CRS, PMS, spa, table management, etc. In general, the information flow remains one way – into the CRM. There’s good news though -- several CRM vendors are addressing the issue. Springer-Miller offers a solution that can pass fully synchronized and syndicated copies of guest profiles, in near real-time, between the CRM and all the PMSs. It doesn’t matter where the profile was created or modified. 
Others begin at the user interface (UI) level. They let hotel front desk or reservations staff perform semi-automated lookups directly into the CRM using the guest or booking data present on their PMS screens. Depending on the PMS, Travelclick’s Guest Management System can return cleansed profiles to the PMS or embed the CRM data onto or on top of the PMS UI. 
The Cendyn, eNgage product’s UI integration interprets a guest’s profile data in the CRM and offers a tailored spiel for the agent to use at check-in. They might greet the guest with something like this: “Welcome back Mr. Siegel, and how did you enjoy your stay at our sister hotel last month? I see you asked for a dehumidifier during your last stay, can I arrange one for this stay too?” 
The NAVIS Guest Engagement Engine provides real-time guest insights at the CRO terminal. This improves agent productivity and provides a more relevant purchasing experience for the guest.
Even though this technology exists, making the most of it will prove difficult unless users can seamlessly incorporate it into all the operational staff-guest touch points, from voice reservations, to check-in and checkout, front desk and concierge inquiries, and more. Several forward-thinking hotel companies have acknowledged this as a fundamental challenge to address. If resolved, it will create a unique point of guest service differentiation.
VP Marketing and Communications for Sonesta Hotels Scott Weiler uses Guestware to power the Sonesta Travel Pass loyalty program. “One of the best things Guestware does for us is present that profile information to the associate at the front desk, enabling deeper engagement with the guest on arrival and throughout the stay. This is in addition to the points, member-only rates and other benefits of the program to the guest,” Weiler said.
Let’s break down some of the tactics you can use to surprise and delight your guests. First, you need a single view of the guest with accurate name, contact details, explicit preferences and observed preferences. This comes from the profile management and analytics suits. Add to that accurate performance measurements, like total stays/nights, total spend, last stay date/hotel, and how many other properties in the brand the guest has visited. These combine to generate a real-time value-ranking score using a hotel derivation of the classic RFM (recency, frequency, monetary) model. This isn’t the same as a profile linked with a loyalty program. That makes it useful for brands that don’t have them, but still want to value-rank their guests.
You can’t surprise and delight a guest unless you really get to know him. This goes beyond facts like the date of his last visit to include his personal preferences. In the case above, the agent noted that Mr. Siegel asked for a dehumidifier during one of his stays. Most of the time that wouldn’t be noticed or captured in his profile. But at this hotel it did. As a result, each hotel in the brand how has that information.  
Once this syndicated, single-view of the guest exists, hotels can be leverage it for marketing purposes. Smart organizations will share it among all other guest-facing functions so they can deliver those moments of surprise and delight.
There are certainly other CRM strategies a hotel company could choose, but in our experience, the company that masters some of these disciplines and executes well on the others will be well-positioned to maintain a large and growing base of loyal customers advocating for its brand.

To view the CRM Systems Comparison chart, please click here

Counting Cards: La Quinta Inns & Suites

Guest analytics at a grand scale is a challenge. For La Quinta Inns & Suites this means understanding the most profitable way to target over 50 million past guests. Using a complex segmentation scheme that is applied to every past guest requires efficient processing to ensure timely execution of direct marketing campaigns. More importantly, La Quinta requires analytics that go beyond opens and clicks.  The company wants to know actual guest spend at a granular level. It also needs to know the last time a guest stayed at a La Quinta, which property in which city, how much was spent, what day of the week he arrived, the room in which he stayed and numerous other details.
Simple RFM (recent, frequent and dollar spend) scoring is not sophisticated enough for a marketing team that is tasked with driving incremental revenue through a process of targeting millions of “returns” members and non-members alike.   While La Quinta Inns & Suites is in the select service space, its approach to direct marketing and guest analytics is on par with any of the major brands. Another strategy worth noting is its focus on non-loyalty member direct marketing.  Realizing that the aggregate data spend of non-loyalty guests is a significant portion of La Quinta’s total revenue, all guests are analyzed to understand his or her true value to the enterprise, regardless of loyalty membership.  
Vice President of Loyalty Marketing for La Quinta Inns & Suites David Sims said, “Executing direct marketing campaigns to millions of past guests requires a highly efficient marketing automation system with no sacrifice on data quality. Our marketing database is the foundation for all our targeted marketing efforts, and the Clairvoyix database consistently delivers. We get our campaigns out on time and without costly errors. We utilize a sophisticated segmentation scheme that is changing as we apply the knowledge gained from the results of every campaign. Applying an actual dollar spent ROI process across dozens of segments and millions of guests is not possible without our Clairvoyix marketing automation system.”
Guest analytics at a grand scale is a business necessity for all of the major brands. La Quinta Inns & Suites approaches this problem from the ground floor. Build a marketing database with cleansed and deduped guest data, apply a sophisticated segmentation scheme, target market, and the results will speak for themselves.    

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