Market study looks at holiday resort CRM & loyalty

Customer expectations, demand for control, the power of perception, and declining customer loyalty are among the key marketing issues examined in a new study of CRM and customer loyalty in the holiday resort market.

The study by the Hospitality Sales & Marketing Association International (HSMAI) Resort Marketing Special Interest Group concluded that there are eight 'building blocks' that resort marketers need to address in their customer loyalty and CRM initiatives:

1. Customer data;
2. Customer profiling;
3. Service experience;
4. Group sales & call centre applications;
5. Loyalty and retention;
6. Direct marketing;
7. Interactive dialogue;
8. Keeping score.

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

Recommendations
Specifically, the report offers a series of recommendations for resort marketers seeking to embrace CRM practices, covering 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.

Key findings
Among the study's main findings:

• 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.
   
• Demand for control
  Consumers don't expect to encounter 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 any company with which they deal. They want to have all their questions answered, they want the ability to customise their purchase to meet their needs, and they may also want to have their communications customised.
   
• 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.
   
• Declining customer loyalty
  Perhaps in response to a plethora of available choices, consumer loyalty in the sector is declining. Consumers are seeking new and interesting experiences, they know they can search for better value for any hospitality product, and this all results in a weakening in the relationships between hotels or resorts and their guests.

Experience is not everything
The study was based on interviews with resort executives and their vendors. Almost all resorts 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 and accounting was rarely mentioned.

But CRM can include a range of applications, from loyalty, retention and sales programmes to product optimisation to name just 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. Indeed, if done correctly, they can achieve all of these goals at once. But management need to dynamically direct staff to continue to evolve in response to customer requirements, whether that's to improve operations, finance, or sales and marketing.