In the ever competitive and evolving hotel sales landscape, the value of repeat guests cannot be overstated. Recent studies of leading hotels have reiterated that gaining a new guest booking costs anywhere from five to eight times more than that of retaining an existing guest. Building a well thought guest retention strategy can earn you a significant amount of revenue in the long run while providing other key benefits.
However in an increasingly complicated environment of OTA’s, non-traditional hotel offerings, growing competition, and multiple channels of instant feedback and online reviews, it has become taxing for hoteliers to differentiate their offerings while building a customer retention strategy that will maintain guest satisfaction levels required to keep guests excited about coming back.
These 8 guest retention revelations have been specifically strung together to get your hotel on its way.
The methods may vary for different sized and types of hotels but the core principles are the same, start by listing and prioritizing past guests based on metrics such as recency, frequency and monetary value.
This will create the foundation for your guest categories and help you easily target sub-segments by importance and behavior, some examples include: guests who booked last year vs last month (recency), guests who have only stayed with you once vs guests who return every holiday season as well as those we spend €1000 vs those who spend €10 000.
Once this exercise is complete you will have identified your VIG’s (Very Important Guests), which in most cases would equate to: guests who stayed with you recently, spent well, and have a history of returning. These are the types of quests who will refer and grow your hotel's reputation by word of mouth and should be considered as brand ambassadors.
We all know by now CRM stands for customer relationship management, however id like you to think of it as a customer remuneration miner for this exercise and you will soon understand why, but before we get down to the gold, let's discuss some housekeeping rules that will keep your data clean and relevant, giving you a better foundation for your sales strategy.
It's a tedious and often ignored exercise to periodically review your databases (eg. once per quarter or even every Spring - If you're the Spring cleaning type), remove / merge duplicate entries, add missing fields and correct spelling errors, in the process you will already start to identify opportunities in this step, but the real magic is still to come.
A pro-tip and grassroots approach to any CRM methodologies is to have data validation and process in place on first time entry.
In the previous point we discussed what I like to call ‘Customer Remuneration Miner’, well now that you've identified solid leads in your clean and well kept database, it's time to grab your shovel and put on your hard-hat.
Create targeted campaigns and offers based on previous preferences and behaviors such as: guests who always request early check-in, those who enjoy your in-stay breakfasts, the more you know the better, a very well targeted offer could look something like this: free shuttle service and early check-in for a VIG (Very Important Guest) who is a business traveler that arrives on the first flight in monthly for sales meetings. Your only two limitations here are your creativity and available information.
Business travelers make up the bulk of most hotels repeat bookers, and those that have figured out ways to make these stays more convenient and exciting for their business travelers by creating an environment that is comfortable and personalized, which suggests you know the guest and having them back at your hotel is like having a relative visit.
A winning formula almost always includes experiences that build community, relationships and most importantly a sense of home, which even the smallest gestures such as greeting guests by name and offering services based on their preferences can go a long way. By understanding what is motivating a repeat booking you can double down on the good and eliminate unnecessary efforts.
Your hotel loyalty or rewards program should not only be designed to entice guests to keep returning but most importantly add value and enhance your guest’s experience. Remember while loyalty points may offer more monetary value to a guest, a customized incentive may be far more motivating and add more personal touch.
Simply ask yourself: Which is more motivating to you – points on a card that will eventually (maybe) add up to a free room for one night, or a free coffee every morning of your stay. While loyalty points may offer more monetary value to a guest, a customized incentive may be far more motivating and add more personal touch.
As you offer repeat incentives, keep track of them in your CRM to see which ones guests acted on. As you associate these incentives with your guest booking personas, you’ll start to see what motivates repeat bookings for different audience members and be able to further focus your efforts.
A hotel recently received a negative review stating that the transport to and from the airport to the hotel was a nightmare as local taxi services were unreasonably priced and although the experience at the hotel was in order they were unlikely to stay there again. The hotel responded by thanking the guest and mentioning that due to the feedback they now offer a complimentary shuttle service, needless to say the guest ended up rebooking and the hotel has since seen an increase in bookings directly from guests arriving on local and international flights.
Guest feedback is not only a powerful way to improve your offering; it’s a potentially huge motivational tool for future stays when acted upon. Use guest feedback to personalize your outreach and create trust with your guests. Note any feedback you receive in your CRM, so that when you reach out in the future you can customize your message. An email saying “we know you loved the rooftop garden during your last stay” shows that you listened to the guest and care about what makes their stay special.
Once your guests arrive, everything you do should be about serving and accommodating their specific wants and needs with gracious, personalized attention. Good old-fashioned customer service will always remain as one of the best retention strategies. According to a study done by MCD Partners, 74% of travelers reported interest in substantial proactive involvement from hotels during their stay in order to make their visits better. The better you are at providing a great experience for your VIGs, the more likely they will be to return.
Identify your VIPs before their stay, and make sure your staff are aware of their wants and needs ahead of time. Greet them by name, put their favorite beverage in their room, or leave a list of the best Italian restaurants in the city on their desk – these small gestures won’t take much time, but will go a long way towards creating a strong relationship with your most valuable guests.
Adding gamification such as ‘UpsellGuru’ allows guests to upgrade their rooms, and add amenities through a proprietary bidding system which enhances their overall guest experience by personalizing their stay and ultimately increases the revenue of the hotel. The upselling system adopts a real feel of gamification by utilizing a slider to adjust the bid which although maintains a minimum and maximum price gives the booker control over the personalization of their stay within their preferred budget.
These 8 guest retention revelations should have set you off on the path to better guest satisfaction and highlighted ways to retain your base while growing and scaling your brand, keeping your guests feeling valued and understood, so they keep coming back to your hotel time and time again.
Now that you know how to retain your guests it's time to turn the page and start your upselling journey, with UpsellGuru increasing your hotel revenue goes hand in hand with enhancing your guests experience by given them an exciting opportunity to upgrade rooms and add services pre-arrival and during their stay.
Find out more about UpsellGuru here.