Hotels and hotel companies have a lot to gain by doing a better job of customer experience management. In a study titled “The Business Impact of Customer Experience, 2012,” Forrester Research reports companies in the hotel industry stand to achieve more revenue benefit from improving customer experience than companies in any of the other 11 industries they examined. The revenue gains are driven by incremental sales from existing customers, revenue saved by lower churn (loss of customers) and new sales driven by word of mouth.
CEM is about creating value for customers in the form of experiences. A customer experience is a private event consisting of an intellectual or emotional response to one or more of the stimuli generated by a product or service offering. CEM goes beyond creating one or two entertaining experiences—say, placing photographs of movie stars on the wall—to creating a comprehensive strategy for managing the customer’s experience at every point where he or she interacts with the offering.
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Kevin Holt |
Customers interact with an offering before, during and after they consume it. In the case of a hotel guest, the pre-consumption interactions include visiting the hotel’s website, being called on by a salesperson and booking the reservation through the call center. Consumption-related interactions have to do with interacting with the facility and staff during the guest’s stay at the hotel. Post-consumption interactions include follow-up calls, satisfaction surveys, mailings, etc.
At the tactical level, the first step in practicing CEM is to create a customer journey map. A journey map details along the horizontal axis each of the points at which the customer interacts with the offering before, during and after consumption. The vertical axis is used to identify the people, systems and parts of the offering the customer interacts with at each point. The result is a matrix in which each cell consists of a touch point.
The next step is to identify the stimuli generated by the offering at each of the touch points. A stimulus is anything perceived by one, or some combination, of the five senses—sight, sound, smell, taste and touch. For a hotel, it includes the appearance of the staff, the tone of voice of the person answering the phone, the smell of the guestroom, the feel of the furniture and the taste of the food.
Once you’ve inventoried all the things a customer sees, hears, touches, tastes and smells at a particular touch point, you’ll want to design the experience you intend the customer to have at that point. There are two fundamental types of experience—functional and emotional.
Functional experience
A functional experience has to do with whether a certain function is provided and how well it is performed. An example of a functional experience in a hotel is transportation. Does the hotel offer the transportation function? If so, how well does it perform the function with respect to things such as the hours and frequency of operation? A second example of function and performance in a hotel would be whether a hotel offers multiple ethnic cuisines (function) and, if so, the number and quality of the cuisines it offers (performance).
Emotional experience
Emotional experiences have to do with how the stimuli emanating from a person or object make a customer feel. There are hundreds of emotions, most of which fall into one of eight families—anger, sadness, fear, disgust, shame, surprise, enjoyment and love. The goal is to engineer experiences that eliminate or minimize the first five families of emotion and maximize the emotions in the last two families. One can be pleasantly or unpleasantly surprised, so the emotion of surprise is something that is maximized or minimized, as the case may be.
Most companies—including hotel companies—fail to manage emotional experiences with the same rigor they manage the functional aspects of their offering. And that spells opportunity. Continuously searching for innovative ways to generate positive emotional experiences has great potential for gaining competitive advantages. It helps to use the frameworks and tools that are available to carry out the search.
CEM doesn’t stop with the tactical steps outlined above. There are also strategic issues to consider, including positioning, platforms, measurement, governance and culture. CEM can—and should—be extended beyond individual product-service offerings to customers’ experience of the entire company and its brands.
Kevin Holt is the president of Co.Innovation Consulting, a lodging industry strategy and innovation consultancy. The company uses cutting-edge methods and technology to help hotels and industry organizations gain competitive advantage. Its services include hotel market studies, market segmentation studies, and design research and workshops and innovation initiatives pertaining to competitive and innovation strategy, B2B sales strategy, lodging concept design, service and customer experience design, and performance improvement. For more information, go to www.coinnovationconsulting.com. Or you can contact Kevin by calling 602-510-8080 or emailing kholt@coinnovationconsulting.com.
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