How positive guest experience impacts a hotel’s revenue?
Guest experience is the culmination of a series of interactions and services offered by a hotel to its guests. Being a part of guest facing industry, hotels must offer top class services to their guests. Converting a guest to a “happy-guest” has a chain reaction of positive actions.
Happy guests become a hotel’s brand ambassadors. They write positive feedback across online review sites. They share their experience with friends and family. Thus, they influence potential buyers’ booking decision, too. Moreover, positive experience makes a guest loyal to the hotel brand. Apart from recommending the hotel to others, a loyal guest comes back to the property, thus helping the hotel generate more revenue (at zero further acquisition cost). In short, quality guest experience creates happy guests and in turn, happy guests do create happy hotels ($).
However, a negative guest experience can just do the opposite.
Unhappy guests would no doubt write negative reviews. This impacts a potential guests booking decision. Sample this — almost every guest reads online reviews before booking a hotel. 80% of them take reviews quite seriously. While 71% of them appreciate management response, around 86% would have a positive impression on a hotel that responds to bad reviews in appropriate manner. Hotels must understand that defensive reaction to bad reviews with negativity will have catastrophic consequence of unspeakable proportion. It has already happened in the past. Here is how a hotel ruined its reputation by penalising negative reviews. In short, a negative guest experience is a hotel’s nightmare.
Benefits of having happy and loyal guests
Happy guests are always good for your hotel’s health. With a mere 1% increase in reputation score, a hotel can increase it’s ADR around 7%. Additionally, this would also lead to a 1.4% increase in occupancy rate. The list of benefits of having satisfied guests does not end here. There is more to it — according to the 2017 smart decision guide to hotel guest experience management, a hotel can witness 97% increase in its revenue and profit if its guests are happy. Moreover, positive experience helps a hotel reduce sales and operating cost by nearly 80%. And most importantly, it is always 6 to 7 times more expensive to acquire a new guest than retaining one by offering best services.
It is all about well managed guest experience to earn their loyalty
The location, grandeur, quality of food, amenities, and cleanliness of a property etc are no doubt some of the most important aspects of a hotel when we talk about guest experience management. But, it is not only a tastefully decorated room which makes a guest happy. It is not only a fine dine restaurant offering delectable food that attracts a guest. Rather, it would not be absurd to say that offering faster and personalized services to guests throughout their stay is quite critical, too. To be noted here, hotels must work relentlessly to earn loyalty of their guests.
Know your guests better to serve them better
Start with in-depth and detailed guest profile. Keep collecting minuscule information about your guests’ choice, likes, dislikes from across various hotel interaction points — reservation, front desk, concierge and room service etc. Understand their pattern of room booking, choice of alcohol and newspaper etc and make sure that you offer them the same during their next visit before they ask. This would make them feel special and they will fall in love with your hotel brand and spend more too.
Loyalty programs — make it more guest-friendly
Offer your repeat guests the right loyalty points through flexible loyalty programs. Do remember that your guests will be happy if you allow them choose from wide-range of reward points. For example, don’t force them to redeem their points while buying something from your hotel. Instead, help them redeem their points while buying a movie ticket, or a flight ticket or even a bottle of wine.
The firm focus on offering top notch customer experience is vitally important in hotel industry. This means that hotels must become ‘guest-centric’ by offering personalized service. Their every decision should revolve around their guests’ requirements. Gaining customer loyalty at every stage of guest life cycle — pre-booking, post-booking, check-in, during the stay, and post-stay should be the goal for a hotel. In short, engaging guests and exceeding their expectations are two most important factors hotels to earn unwavering guest loyalty in order to increase revenue.
