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Exploring Costs and Tools in the Seven-Step Guest Journey

18 January 2024
The exploration in the blog post "Decoding Hotel Expenses: Understanding Costs Through the Guest Journey" laid a foundation for understanding how costs impact each stage of the guest experience in the hospitality industry. However, the complexity and depth of these costs warrant a closer, more detailed examination.
This blog post provides an in-depth analysis of the costs associated with each phase of the guest journey. It will meticulously break down the financial layers from the moment of inspiration to the post-stay phase, where loyalty is established. This detailed analysis aims to reveal the subtleties of financial management at each step, highlighting the potential for a significant impact on a hotel's profitability and ability to delight guests.
The post aims to offer a comprehensive exploration, providing readers with nuanced insights and actionable strategies. It is designed to equip hoteliers with an enhanced understanding of optimizing financial performance while continuously elevating the guest experience. This piece is not merely a continuation but an expansive deepening of knowledge to transform hotel cost management perspectives.
Before proceeding, please read "Decoding Hotel Expenses: Understanding Costs Through the Guest Journey" to better understand the subject.

Cost categories

In the previous post, we looked at the three primary cost categories pivotal to a hotel's financial health: Customer Acquisition Cost (CAC), Cost of Goods Sold (COGS), and Operating Expenses. These categories are allocated to each step in the seven-step guest journey as high, moderate, or low. Let's start by taking a look at the allocation to each step.

Customer Acquisition Cost (CAC)

Here's a summary of how Customer Acquisition Cost (CAC) is allocated across the different steps of the guest journey:
  1. Inspiration:
    • CAC Allocation: High. This stage involves substantial investment in marketing and advertising to spark the interest of potential guests. It includes costs for brand awareness campaigns, social media advertising, and other forms of outreach aimed at inspiring travel.
  2. Research:
    • CAC Allocation: High. Continued investment in marketing is crucial as potential guests explore destinations and accommodations. This includes maintaining an engaging and informative online presence, SEO efforts, and targeted advertising to keep the hotel top-of-mind.
  3. Shop and Book:
    • CAC Allocation: High. This phase sees significant costs related to booking platforms and final marketing efforts. Costs include commissions paid to online travel agencies, booking engine maintenance, and promotions to encourage bookings.
  4. Prepare:
    • CAC Allocation: Low. The customer has already been acquired by this stage, so direct acquisition costs are minimal. However, there may be minor expenses related to pre-arrival communications to enhance the guest's anticipation and satisfaction.
  5. In-House Experience:
    • CAC Allocation: Low. The focus at this stage is on delivering the service, not on acquisition. CAC is minimal as efforts are directed towards ensuring an exceptional stay, which can indirectly influence future acquisitions through positive experiences and word-of-mouth.
  6. Share and Review:
    • CAC Allocation: Moderate to High. Post-stay efforts to encourage guests to share their experiences and leave reviews can be considered part of CAC, as these actions enhance reputation and influence future guests. This may include follow-up communications, review incentives or social media engagement.
  7. Remember and Return:
    • CAC Allocation: Moderate. Efforts to encourage repeat visits, such as targeted email campaigns, loyalty program promotions, and personalized offers, are part of CAC. These strategies are focused on maintaining a relationship with past guests to foster loyalty and repeat business.
In summary, CAC is heavily concentrated in the early stages of the guest journey (Inspiration, Research, Shop, and Book) and transitions to maintaining customer relationships and fostering loyalty in the later stages. This strategic allocation of CAC throughout the guest journey helps ensure a balance between attracting new guests and retaining existing ones, contributing to the hotel's overall profitability and success.

Cost of Goods Sold (COGS)

Here's a summary of how the Cost of Goods Sold (COGS) is allocated across the different steps of the guest journey in a hotel:
  1. Inspiration:
    • COGS Allocation: Very Low. During this phase, direct costs related to goods or services are minimal as the potential guests are only inspired to travel, and no actual hotel services are utilized.
  2. Research:
    • COGS Allocation: Very Low. Similar to the Inspiration stage, minimal direct costs are involved since guests are only researching and have not yet availed any services from the hotel.
  3. Shop and Book:
    • COGS Allocation: Low to Moderate. Some direct costs begin to occur, primarily related to reservation handling and the use of booking systems, although these costs are relatively minor compared to later stages.
  4. Prepare:
    • COGS Allocation: Moderate. This stage involves preparation for the guest's arrival, including stocking up on necessary supplies, room preparation, and other direct costs associated with getting the hotel ready for the guest’s stay.
  5. In-House Experience:
    • COGS Allocation: High. This is the phase where COGS is at its peak, as it includes all direct costs associated with the guest's stay – such as room amenities, food and beverages, housekeeping, and any other guest-specific services.
  6. Share and Review:
    • COGS Allocation: Low. Direct costs in this phase are minimal since the guest has completed their stay. However, minor costs might be incurred in managing feedback platforms or customer service channels for reviews and responses.
  7. Remember and Return:
    • COGS Allocation: Low. In this final stage, direct costs are limited and mostly pertain to communication efforts to re-engage past guests, such as through email marketing for special offers or loyalty programs.
In summary, COGS in a hotel is mainly concentrated in the In-House Experience stage, where the guest directly consumes the bulk of goods and services. Other stages of the guest journey incur minimal to moderate COGS, depending on the operational costs, and are still preparation and engagement required for prospective and returning guests. Understanding this allocation is crucial for hotels to manage their resources effectively and ensure profitability.

Operating Expenses (OE)

Here's a summary of how Operating Expenses are allocated across the different steps of the guest journey in a hotel:
  1. Inspiration:
    • Operating Expenses Allocation: Moderate. While this phase focuses on attracting guests, operational costs, such as maintaining a solid brand image and supporting marketing departments, are still involved.
  2. Research:
    • Operating Expenses Allocation: Moderate. Costs include maintaining an informative and appealing online presence, like website operations and customer service support for queries.
  3. Shop and Book:
    • Operating Expenses Allocation: Moderate. This stage involves expenses related to the operation of booking systems, customer support, and possibly technology upgrades to ensure a seamless booking experience.
  4. Prepare:
    • Operating Expenses Allocation: Moderate. Preparing for a guest's arrival incurs operational costs like staff training, inventory management systems, and administrative tasks to ensure readiness.
  5. In-House Experience:
    • Operating Expenses Allocation: High. This phase is the most cost-intensive, involving expenses for running the hotel's day-to-day operations, such as staff wages, utility bills, ongoing maintenance, and general administration.
  6. Share and Review:
    • Operating Expenses Allocation: Moderate. Post-stay operating expenses include managing the hotel’s online presence, handling customer feedback, and maintaining customer relationship management systems.
  7. Remember and Return:
    • Operating Expenses Allocation: Moderate. Costs here are associated with maintaining loyalty programs, marketing for repeat stays, and ongoing customer relationship management efforts.
In summary, Operating Expenses in a hotel are consistently present throughout the guest journey, with the intensity varying based on the nature of activities at each stage. The highest expenses are typically incurred during the In-House Experience due to the comprehensive operational activities required to maintain the hotel's services and facilities. Managing these expenses effectively across stages is crucial for the hotel's smooth operation and overall financial health.

The difference between CAC and OE

It isn't easy to analyze CAC and OE from an operational and strategic perspective if the definitions are not 100 percent clear. There are two ways to clarify the differences.

Variable or fixed costs?

One way is to classify the costs as variable or fixed. CAC is the variable cost for acquiring revenue, and OE is the fixed cost or the capacity cost to acquire revenue.
  1. Customer Acquisition Cost (CAC):
    • Nature: CAC refers explicitly to the costs of acquiring a new customer. This includes all expenses directly related to marketing and sales efforts that lead to attracting a guest to book a stay at the hotel.
    • Examples: Advertising campaigns, promotional offers, commissions paid to booking sites, costs associated with SEO and digital marketing, sales team expenses, and costs for marketing tools and software.
    • Focus: The primary focus of CAC is on the conversion – turning potential guests into actual guests. It's a metric often used to assess the effectiveness and efficiency of marketing and sales strategies.
  2. Commercial Operating Expenses:
    • Nature: These are broader and include all ongoing costs required to run the commercial aspects of the hotel business, not just those tied directly to acquiring new customers.
    • Examples: Staff salaries (beyond the sales team), ongoing maintenance of sales and marketing infrastructure, costs associated with general market research, brand-building activities not directly tied to immediate sales, general administrative expenses related to commercial operations, and technology upkeep costs for systems supporting sales and marketing.
    • Focus: The focus here is on sustaining and supporting the overall commercial operations of the hotel. These costs are necessary for the day-to-day functioning of the commercial side of the business.

Key Differences

  • Direct vs. Indirect Costs: CAC is more about the direct costs tied to acquiring each new customer, while commercial operating expenses encompass a more comprehensive range of indirect costs that support the commercial infrastructure of the hotel.
  • Short-Term vs. Long-Term: CAC often has a more immediate and short-term focus (i.e., acquiring new customers for the upcoming season), whereas commercial operating expenses include long-term investments in brand building and maintaining operational capabilities.
In summary, while there's some overlap between CAC and commercial operating expenses, they serve different roles in cost analysis. CAC is a more targeted measure focusing specifically on the cost of acquiring new customers. In contrast, commercial operating expenses cover the broader, ongoing costs of maintaining and supporting the hotel’s commercial activities. Understanding the distinction between these two types of costs is crucial for effective financial planning and resource allocation in the hospitality industry.

Allocation of resources

Another way is more strategic, where all resources, including sales and marketing personnel costs, are considered a Customer Acquisition Cost (CAC) rather than general operating expenses. This aligns with a more direct method of attributing costs to revenue generation activities. Let's explore this in detail:
  1. Sales Personnel Costs as CAC:
    • Rationale: The primary role of sales personnel in a hotel is to directly generate revenue by acquiring new customers. This includes reaching out to potential clients, negotiating deals, managing corporate accounts, and actively pursuing leads to convert them into bookings.
    • Impact on CAC: Including sales personnel costs in CAC provides a more accurate picture of the investment required to acquire each customer. It ties the cost directly to the revenue-generating activity, making it easier to assess the efficiency and effectiveness of the sales team.
  2. Marketing Personnel and Activities as CAC:
    • Rationale: Marketing efforts in a hotel are directly aimed at attracting new guests through various channels. This encompasses advertising, digital marketing, social media campaigns, promotional events, and other initiatives designed to raise awareness and interest in the hotel.
    • Impact on CAC: By categorizing marketing expenses, including personnel costs, as part of CAC, it becomes clearer how these efforts contribute to attracting new guests. It helps in evaluating the ROI of different marketing strategies and channels.

Broader Perspective

  • CAC as a Comprehensive Measure: In this approach, CAC is seen as encompassing all expenses directly tied to the generation of new business, which includes the salaries, commissions, and related costs of sales and marketing personnel.
  • Strategic Decision-Making: Understanding that sales and marketing efforts are direct revenue drivers can aid in more strategically allocating resources and budgeting in these areas. It can also help set more accurate performance targets for sales and marketing teams.
In conclusion, viewing sales and marketing personnel costs as part of CAC is a strategic approach in hospitality finance. It underscores the direct connection between these roles and the hotel's revenue generation, allowing for a more focused analysis of how these investments translate into new customer acquisition. This perspective can lead to more informed decisions about resource allocation and strategy in hotel companies.
Now, let's take a closer look at each step of the guest journey, uncovering the costs and tools involved and providing insights on optimizing these for the benefit of both the guests and the hotel. Whether you're a seasoned hotelier or new to the industry, this journey will provide valuable insights into the intricate workings of a successful hotel operation.

Step 1/7: Inspiration

Understanding the First Spark of Travel

The guest journey begins long before a reservation is made. It starts with inspiration, that initial spark that ignites the desire to travel. In this digital age, inspiration can come from many sources, and understanding these can help hoteliers tap into potential guests' desires effectively.
Generally, generic hotels can skip this step and should refrain from investing anything in this stage. Attracting travelers to a destination is the job of a destination marketing company. Hotels can join the efforts and should work closely with the destination marketing company. Only very few “destination” hotels could benefit from investing in this stage.

The Role of Digital Influence

In the era of social media, platforms like Instagram, Facebook, Pinterest, and TikTok play a significant role in inspiring travel. Stunning images, captivating videos, and engaging content from content creators can lure travelers into dreaming about their next getaway.

Costs Involved:

  • Content Creation: High-quality photography, videography, and writing to showcase the destination and its surroundings.
  • Social Media Management: Tools for scheduling posts, analyzing engagement, and managing multiple social media accounts.
  • Influencer Partnerships: Collaborating with influencers and content creators to reach a broader audience.

Tools and Strategies:

  • Engaging on Social Media: Regularly posting high-quality, inspiring content about the destination and its location.
  • Leveraging User-Generated Content: Encouraging guests to share their experiences can serve as authentic and persuasive content.
  • Press Communications: Utilizing digital platforms for press releases and media outreach.

Word of Mouth and Traditional Media

While digital platforms are powerful, traditional sources of inspiration like word of mouth, magazines, and travel blogs still hold considerable sway. Publications like National Geographic or blogs like Your World Tour can influence decisions significantly.

Costs Involved:

  • Advertising in Magazines and Blogs: Costs associated with placing ads or features in travel-related publications promoting the destination.
  • Building Relationships with Travel Journalists and Bloggers: Hosting media stays, organizing press trips, etc., to promote the destination.

Tools and Strategies:

  • Networking with Travel Writers and Bloggers: Building relationships for potential features and reviews.
  • Community Engagement: Encouraging and facilitating word-of-mouth recommendations through exceptional service and experiences.

Conclusion of Step 1

The Inspiration phase is crucial as it sets the tone and expectations for traveling to a destination. It's about creating a compelling narrative that showcases the destination's uniqueness and captures the essence of the experience waiting for the visitor. By investing in quality content, engaging actively on social media, and fostering positive word-of-mouth, destinations can effectively plant the seed of travel in the minds of potential visitors.
In this digital era, a well-crafted Inspiration phase can significantly expand a destination's reach and appeal. However, balancing the costs and the expected return on investment is essential. Employing the right partnerships, strategies, and tools can help achieve this balance, ensuring that the destination attracts new visitors and builds a foundation for a memorable and satisfying visitor experience.

Step 2/7: Research

Navigating the Path of Exploration and Decision-Making

Once inspired, potential guests move into the research phase. This is a critical juncture where they start delving into specifics: destinations, accommodations, activities, and costs. Understanding and optimizing this phase is crucial for hoteliers to convert interest into bookings.

The Digital Landscape of Travel Research

In today's digital world, travelers extensively use online resources to research their trips. This step is about being visible and appealing when potential guests seek information.

Costs Involved:

  • Search Engine Optimization (SEO): Ensuring your hotel's website ranks high in search engine results for relevant keywords associated with the destination.
  • OTAs: Ensure that your hotel is on the OTAs since many potential guests start their search here to understand the supply of different types of hotels at the destination.
  • Digital Advertising: Pay-per-click campaigns, display ads, and retargeting ads to capture the attention of potential guests.
  • Online Presence Maintenance: Regular updates to your website and listings to keep information accurate and engaging.

Tools and Strategies:

  • Google My Business: A crucial tool for managing your hotel’s online presence on Google, including search and maps.
  • Metasearch Management Tools: Hotels must manage their presence on metasearch engines, which aggregate data from various booking sites.
  • OTA Management: Hotels must manage their presence on OTAs and ensure the right and updated content.
  • Content Marketing: Providing valuable content on your website and blog to attract and engage potential guests considering travel to the destination.

Leveraging Feedback and Comparison Sites

Travelers heavily rely on feedback from others and comparison sites to make informed decisions.

Costs Involved:

  • Reputation Management: Monitoring and responding to reviews across various platforms.
  • Partnerships with Comparison Sites: Costs associated with listing on sites like Kayak, Trivago, and Google Hotels.

Tools and Strategies:

  • Review Platforms: Engaging with guests on TripAdvisor and Google Maps to manage and improve your hotel's reputation.
  • Comparison Site Optimization: Ensuring your hotel's information is up-to-date and attractive on comparison sites.
  • Engaging with Travel Blogs and Forums: Building relationships with travel bloggers and participating in relevant online forums.

Conclusion of Step 2

The Research phase is all about visibility and engagement. Hotels must be present and active where potential guests are looking. Investing in SEO, maintaining a solid online presence, and effectively managing your reputation on feedback and comparison sites can significantly increase the chances of converting researchers into bookers.

Step 3/7: Shop and Book

The Crucial Phase of Making Choices and Commitments
Travelers enter the Shop and Book phase after researching and zeroing in on their preferences. This is where they compare prices, analyze options, and make bookings. For hotels, this stage is about capturing the sale and ensuring potential guests choose their property over others.

Balancing OTA and Direct Bookings

Online Travel Agencies (OTAs) like Expedia and Booking.com play a significant role in this phase, but it's essential for hotels also to encourage direct bookings.

Costs Involved:

  • OTA Commissions: Fees paid to OTAs for each booking they facilitate.
  • Website Maintenance: Costs associated with keeping the hotel’s website functional, up-to-date, and user-friendly.
  • Price Competitiveness: Ensuring rates are competitive while still profitable.

Tools and Strategies:

  • Booking Engines: Utilizing tools for seamless booking experiences on the hotel’s website.
  • Conversion Optimization Tools: Implementing solutions to improve direct booking rates.
  • Rate Parity: Maintaining consistent pricing across all platforms.

Enhancing Direct Booking Experience

While OTAs provide visibility and volume, direct bookings offer higher margins and greater control over the guest experience.

Costs Involved:

  • Digital Marketing: Targeted campaigns to drive traffic to the hotel’s website.
  • Loyalty Programs: Implementing and managing loyalty schemes to encourage direct bookings.
  • Customer Relationship Management (CRM): Tools to personalize guest interactions and foster loyalty.

Tools and Strategies:

  • User-Friendly Website Design: Ensuring the hotel’s website is easy to navigate and book.
  • Personalized Offers: Using data to create tailored promotions for potential guests.
  • Effective Use of CRM: Employing systems for targeted communication and offer management.

Conclusion of Step 3

The Shop and Book phase is a delicate balance of leveraging OTAs' reach while encouraging more profitable direct bookings. By optimizing the booking process, engaging with potential guests through personalized offers, and maintaining competitive yet profitable pricing, hotels can effectively convert interest into confirmed bookings.

Step 4/7: Prepare

Facilitating a Smooth Transition from Booking to Arrival

The Prepare phase is pivotal in the guest journey, bridging the gap between booking and the actual stay. During this time, guests are planning their arrival and stay details. For hotels, this phase is an opportunity to establish a relationship with the guest, offer additional services, and set the stage for a memorable experience.

Personalized Communication and Experience

Effective communication in this phase reassures guests and opens doors for personalized experiences and upselling.

Costs Involved:

  • Communication Channels: Investing in tools for efficient and effective guest communication.
  • Training Staff: Ensuring your team is skilled in customer service and upselling techniques.
  • Developing Personalized Experiences: Costs associated with creating and offering bespoke services.

Tools and Strategies:

  • Communication Tools: Utilizing platforms to manage guest communication across various channels like email, SMS, and WhatsApp.
  • Guest Portals and Apps: Implementing a guest portal or hotel app to provide information, take requests, and offer additional services.
  • Pre-Arrival Upselling: Using tools to offer room upgrades, special amenities, or unique experiences before guests arrive.

Importance of Guest Preparation

Assisting guests in their preparation enhances their experience and streamlines operations upon arrival.

Costs Involved:

  • Resource Allocation: Allocating staff and resources to manage pre-arrival interactions and requests.
  • Technology Investment: Costs of implementing and maintaining guest-facing technologies.

Tools and Strategies:

  • Customized Communication: Sending tailored information about the hotel, local area, and available services.
  • Early Check-In/Check-Out Options: Offering flexible options for added convenience.
  • Local Recommendations: Providing guests with dining, activities, and transportation suggestions.

Conclusion of Step 4

The Prepare phase is integral to the guest journey, setting the tone for the upcoming stay. By investing in practical communication tools and strategies and offering personalized experiences and upselling opportunities, hotels can significantly enhance guest satisfaction even before they set foot there. This proactive approach fosters a sense of anticipation and excitement for the guests and establishes a foundation for a smooth and enjoyable stay.
Adequate preparation is about more than just avoiding potential problems; it's about creating a seamless and personalized experience that begins long before arrival. By understanding and managing the costs and tools involved in this phase, hotels can ensure guests feel valued, informed, and excited about their upcoming stay.

Step 5/7: In-House Experience

Elevating the Guest Experience through Service and Technology

The In-House Experience is where the guest directly interacts with the hotel and its services. This phase is crucial as it's the physical manifestation of all the promises made during the previous steps. It's a time to impress, engage, and ensure guest satisfaction.

Integrating Technology for Enhanced Experience

Incorporating technology into the guest experience can significantly elevate the level of service and convenience provided.

Costs Involved:

  • Technology Implementation: Investing in intelligent room technologies, digital displays, and guest-facing apps.
  • Maintenance of Technological Tools: Regular updates and maintenance of hardware and software.
  • Training Staff: Ensuring staff are well-versed in using and troubleshooting the technology.

Tools and Strategies:

  • Smart Room Technologies: Utilizing tools for controlling room environment and entertainment systems and offering digital concierge services.
  • Check-in Software: Implementing self-check-in solutions to streamline the arrival process.
  • CRM Systems: Using CRM platforms to personalize guest interactions and manage preferences.

Prioritizing Exceptional Service

The essence of the in-house experience still revolves around traditional hospitality values - exceptional service and attention to detail.

Costs Involved:

  • Staff Training and Development: Investing in continuous training to ensure high service standards.
  • Quality Maintenance: Regular upkeep and enhancement of on-site services and amenities.
  • Guest Support Services: Providing 24/7 support and assistance to guests.

Tools and Strategies:

  • Personalized Guest Interactions: Using insights from the data stored about the guests in the hotel PMS to tailor interactions and services to each guest.
  • Efficient Communication Channels: Ensuring guests can access support and services via WhatsApp, chatbots, or in-room tablets.
  • Continuous Feedback and Adaptation: Encouraging and acting on real-time guest feedback to immediately address any issues and improve the ongoing experience.

Enhancing Experience through On-site Amenities

The availability and quality of on-site amenities significantly affect the guest's overall experience.

Costs Involved:

  • Amenities Upkeep: Ongoing maintenance and upgrades of amenities like pools, gyms, spas, and dining facilities.
  • Environmental Comfort: Costs of ensuring optimal room conditions, including heating, cooling, and lighting.
  • Housekeeping and Room Maintenance: Regular and thorough cleaning and maintenance of guest rooms and public areas.

Tools and Strategies:

  • Seamless Integration of Services: Ensuring all on-site services and amenities are easily accessible and well-coordinated.
  • Attention to Detail: Focusing on the finer aspects of the guest experience, from room aesthetics to personalized touches.
  • Sustainable Practices: Incorporating eco-friendly practices that align with modern guest expectations and environmental responsibility.

Conclusion of Step 5

The In-House Experience is the heart of the guest journey, where all pre-arrival expectations meet reality. By leveraging technology to enhance convenience and personalization about meeting expectations and maintaining a strong focus on traditional hospitality values, hotels can create memorable experiences that resonate with guests. This phase is about meeting and exceeding expectations, ensuring guests leave with positive impressions and a desire to return.

Step 6/7: Share and Review

Harnessing the Power of Guest Feedback and Advocacy

After their stay, guests enter the Share and Review phase. This period is critical as guests reflect on their experiences and share them with others, both offline and online. This stage allows hotels to extend the relationship beyond the stay, manage their reputation, and leverage positive experiences to attract future guests.

Emphasizing the Importance of Reviews and Social Sharing

Guest reviews and social media sharing are powerful influencers in the hospitality industry.

Costs Involved:

  • Reputation Management: Monitoring and responding to reviews across various platforms.
  • Social Media Engagement: Actively engaging with guests who share their experiences online.
  • Customer Feedback Systems: Implement and manage systems to gather and analyze guest feedback.

Tools and Strategies:

  • Review Platforms: Utilizing tools to monitor, analyze, and respond to online reviews.
  • Proactive Social Media Interaction: Engaging with guests on platforms like Facebook, Instagram, and X, encouraging them to share their experiences.
  • Post-Stay Communication: Following up with guests through email or messaging to thank them, gather feedback, and encourage reviews.

The Ripple Effect of Word-of-Mouth

Positive experiences can lead to word-of-mouth recommendations, which are invaluable for a hotel's reputation and future bookings.

Costs Involved:

  • Guest Relationship Management: Maintaining communication with past guests to encourage repeat visits and referrals.
  • Marketing Campaigns: Leveraging positive reviews and testimonials in marketing materials.

Tools and Strategies:

  • Leveraging Positive Experiences: Showcasing good reviews and guest stories in marketing and social media.
  • Referral Programs: Implementing referral incentives to encourage guests to recommend the hotel to friends and family.
  • Continued Engagement: Staying connected with guests through newsletters, special offers, and loyalty programs to foster a sense of community and belonging.

Managing Negative Feedback Constructively

Addressing negative feedback effectively is crucial for reputation management and continuous improvement.

Costs Involved:

  • Response Management: Time and resources dedicated to addressing and resolving negative feedback.
  • Service Recovery: Costs associated with compensating dissatisfied guests and rectifying issues.

Tools and Strategies:

  • Constructive Response Protocols: Establishing a system for timely and empathetic responses to negative reviews.
  • Analyzing Feedback for Improvement: Using negative feedback as a tool to identify areas for improvement and training.
  • Follow-Up Actions: Ensuring that guests who had a less-than-ideal experience are followed up with to demonstrate commitment to service excellence.

Conclusion of Step 6

The Share and Review phase is crucial in shaping the hotel's reputation and influencing future guests. By actively managing guest reviews, engaging with guests post-stay, and leveraging positive and negative feedback, hotels can build a strong reputation, encourage repeat business, and attract new guests through word-of-mouth. This phase is about turning guests into advocates and using their experiences to improve and grow continuously.

Step 7/7: Remember and Return

Cultivating Loyalty and Encouraging Repeat Visits

The Remember and Return phase is the final but ongoing stage of the guest journey. It focuses on keeping the hotel top-of-mind for guests after their stay, encouraging them to return and become loyal brand advocates.

Building Lasting Relationships with Guests

Post-stay engagement is critical to fostering loyalty and securing repeat business.

Costs Involved:

  • Customer Retention Programs: Designing and implementing loyalty programs and initiatives.
  • Targeted Marketing Campaigns: Creating and running marketing campaigns aimed at past guests.
  • Data Analysis and Management: Analyzing guest data to tailor future communication and offers to new guests within the same target audience.

Tools and Strategies:

  • CRM Systems: Utilizing platforms for managing guest data and personalizing communication.
  • Personalized Marketing: Leveraging tools for targeted email campaigns based on guest preferences and history.
  • Loyalty Programs: Designing incentive programs that reward repeat bookings and referrals.

Encouraging Repeat Visits

The goal is to make guests feel valued and inclined to book again despite slim chances. Less than ten percent of guests staying in a hotel on a given day have stayed there.

Costs Involved:

  • Special Offers and Discounts: Providing exclusive deals to encourage repeat bookings.
  • Customized Communication: Costs associated with creating and sending personalized messages and offers.
  • Guest Feedback Integration: Incorporating guest feedback into service improvements and marketing strategies.

Tools and Strategies:

  • Exclusive Promotions: Offering past guests exclusive access to special rates, upgrades, or packages.
  • Segmented Communication: Tailoring communication based on guest profiles and past behaviors.
  • Engagement through Memories: Sharing nostalgic content or reminders of their previous stays to rekindle their positive experiences.

Turning Guests into Brand Ambassadors

Happy guests can become influential promoters of the hotel.

Costs Involved:

  • Referral Programs: Implementing and managing referral incentives for guests.
  • Community Building: Engaging with past guests through social media, events, or clubs.

Tools and Strategies:

  • Social Media Engagement: Creating a community feeling by engaging with guests on social media, sharing updates, and inviting them to exclusive online groups or events.
  • Brand Ambassador Programs: Encouraging satisfied guests to share their experiences and offer them incentives for bringing in new guests.
  • Continued Personalization: Maintaining the personal touch in all interactions, even after the stay, to make guests feel uniquely valued.

Conclusion of Step 7

The Remember and Return phase is crucial for building a sustainable and successful reputation. By investing in targeted marketing, hotels can increase the likelihood of turning satisfied guests into brand ambassadors. Personalized communication, exclusive offers, and focusing on creating lasting relationships are critical strategies in this phase.
Through effective use of the hotel PMS, loyalty programs, and personalized marketing tools, hotels can keep themselves at the forefront of guests' minds, ensuring that their property is the first choice when the time comes for their next trip.
This concludes our exploration of the seven-step guest journey in the hotel industry. Each step, from Inspiration to Remember and Return, presents unique opportunities and challenges. By understanding and effectively managing the costs, tools, and strategies at each phase, hoteliers can create a seamless and memorable experience for their guests, fostering loyalty, satisfaction, and business success.

Conclusion and Key Takeaways

Synthesizing the Seven-Step Guest Journey for Hotel Success

As we conclude our exploration of the seven-step guest journey, it's clear that each phase plays a vital role in shaping hotel guests' overall experience and satisfaction. From sparking initial interest to nurturing post-stay relationships, every step offers unique opportunities for hotels to excel and make a lasting impression.

Recap of the Seven Steps

  1. Inspiration: Capturing potential guests' imaginations through engaging content and strategic social media presence.
  2. Research: Ensuring visibility and appeal during guests' information-seeking phase with effective SEO and online presence.
  3. Shop and Book: Balancing OTA use with direct bookings, emphasizing user-friendly booking experiences.
  4. Prepare: Personalize communication and offer tailored services to set the stage for a great stay.
  5. In-House Experience: Utilizing technology and traditional hospitality to provide exceptional service and comfort.
  6. Share and Review: Encouraging and managing post-stay feedback to enhance reputation and attract new guests.
  7. Remember and Return: Fostering loyalty and repeat visits through personalized engagement and incentive programs.

Key Takeaways

  • Comprehensive Approach: Each step requires a tailored strategy and an understanding of the unique needs and opportunities it presents.
  • Investment in Technology and Personalization: The hotel PMS, smart technologies, and personalized marketing tools are crucial in enhancing guest experiences and building relationships.
  • Balancing Digital and Traditional Elements: While technology is critical, traditional hospitality values like personal service and attention to detail cannot be overstated.

The Impact on Business Success

Effectively managing these aspects of the guest journey can enhance guest satisfaction, increase loyalty, and, ultimately, greater business success. Satisfied guests are more likely to become repeat customers and brand advocates, leading to positive word-of-mouth and stronger online reviews, which are invaluable for attracting new guests. Moreover, hotels can achieve a more efficient and profitable operation by understanding and optimizing the costs and tools involved at each stage.

Further Considerations for Hoteliers:

  • Continuous Improvement: The guest journey should be continually evaluated and updated based on feedback and changing market trends.
  • Guest-Centric Approach: Always prioritize the guest's perspective and experience in decision-making processes.
  • Data-Driven Decisions: Utilize guest data and analytics to make informed decisions and tailor services more effectively.

Final Thoughts

The seven-step guest journey is a comprehensive framework that underscores the complexity and interconnectedness of various aspects of the hospitality industry. By meticulously managing each phase, hoteliers can create a harmonious and enriching experience for their guests. The key is to blend technology and personalization, balancing innovation and hospitality's timeless essence. In doing so, hotels enhance guest experiences and cement their place in a competitive industry, achieving sustained growth and success.