Forrester Wave Report
Leslie Stretch, Medallia CEO, and Borge Hald, Medallia Founder, Reflect on Being Named A Leader by Forrester in The Forrester Wave™ Customer Feedback Management Platforms, Q4 2018 Elena:...
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In the hospitality industry, the smallest nuances of a guest’s experience can have big impacts on their overall satisfaction. After a long, hard day of traveling, what seem like little problems have a big impact on how a tired guest feels — and leaves them with a bad impression that impacts their hotel decisions for years to come.
Knowing this, Choice Hotels — a leading hospitality brand with over 6,300 hotel properties worldwide — has instituted an organization-wide focus on customer feedback. After all, how can they hope to delight their guests without knowing what types of experiences guests are looking for? This focus took time and serious effort, but after several years, it’s given Choice’s guest satisfaction a serious boost — and has resulted in tens of millions of dollars in additional revenue as well.
Here are three key ways Choice has made that focus possible.
1) Clearly Show the Connection Between Guest Satisfaction and Financial Success
Choice already knew that unhappy hotel guests would not want to recommend Choice hotels to others. And when the organization took a closer look at this trend, it realized that the there was a direct link with its bottom line, too. By digging into organization-wide guest satisfaction and financial data, Choice found that the 25% of its properties with the highest Likeliness to Recommend (LTR) scores also had higher-than-average Revenue Per Available Room (RevPAR). What’s more, the inverse held true for properties in the bottom quarter of LTR. Intuitively, Choice believed that guest satisfaction was tied to a hotel’s success.
Now, they knew.
The next question became: how, then, to increase LTR?
2) Identify and Hone In on Critical Guest Pain Points
This is where having a customer experience management (CEM) system in place was of huge help. Choice used it to determine which aspects of their guest experience impacted LTR scores the most. And when “room condition” emerged as one of the biggest drivers, Choice knew exactly where to focus their efforts.
Armed with this knowledge, Choice instituted a “Great Room Condition” initiative to help properties make sure their rooms always met guests’ great expectations. Choice began by piloting the initiative in a few properties to confirm their hypothesis — and sure enough, participating properties saw LTR boosts as a result. That gave the company the ability to roll the program out organization-wide, confident participating properties would benefit from it.
Even better, the initiative had a big impact on Choice’s bottom line, as well — over $18 million in incremental revenue was attributed to this success.
3) Proactively Engage the Frontline
Even the best customer experience system is no use if your frontline doesn’t use it. Regardless of the reason, low engagement means that a system won’t drive impact — meaning, for example, staff won’t close the loop with customers. Given that as many as 50% of consumers will abandon a brand when their complaints go unanswered for more than a week, that’s a dangerous trend.
For some time, Choice was facing this dilemma. Only 40% of its properties were using their CEM — not nearly enough to catch complaints as they came in. So Choice worked to drive guest reviews to its own site and alert managers whenever a comment needed their attention. Choice also used its understanding of the LTR/RevPAR relationship to convince skeptical managers to get on board with the system — and even instituted a penalty system for properties that didn’t respond to feedback promptly.
After two years of this approach, over 88% of properties were engaging with Choice’s CEM — far more than their goal of 65%. And engagement wasn’t the only thing to improve. As a result of this renewed focus on closing the loop with customer, conversion rates and revenue per visit on Choice’s website have gone up — trends that are associated with tens of millions in additional revenue.
These aren’t the only ways Choice is empowering its properties with guest voices. it’s also made big strides in how it handles reviews on all-important social sites like TripAdvisor, and in how it aggregates different types of feedback to draw out fresh insights. Like to find out how they did it? Check out the case study below.Photo credit: Images Money