Customer-relationship management (CRM) has played an integral role in hotel operations for decades. Since the early days of basic loyalty programs and email marketing, operators have leveraged CRM tools to find new and better ways to identify target audiences, upsell services, and personalize and enhance the guest experience.
“CRM is where all back-end systems come alive, integrated, and managed to engage with customers,” says Tony Krajewski, senior partner, Customer Marketing Practice, Deloitte Canada in Toronto. “It is a crucial platform in creating the guest experience. It helps create more personalization in the way of delivering the right messages and offers through the right channels to the right people.”
The pandemic effect
CRM is not a standalone proposition in today’s omni-channel world. Since the start of the pandemic, especially, operators had to rely more on digital channels to communicate with and attract customers, whether through their own websites, or third-party travel services.
“The pandemic was a transformation for hospitality,” says Tanya Pratt, vice-president Strategy and Product Management at Oracle Hospitality in Toronto. “Guests had expectations to be able to engage with a hotel wherever they were in whatever medium they chose. Businesses, in turn, were having to leverage the consumer data they had more than ever to understand their needs, wants and preferences. With that we saw a rise of different technologies that existed before being pushed to the forefront, including the use of CRM.”
Before the pandemic touchpoints were balanced across digital, in-person, social media, and booking interactions, says Krajewski. “The pandemic, however, changed the level of competition. Operators saw the need to make their CRM strategies work so much better. Any organization that had not built out their digital channels had to make a mad scramble to get it done.”
Tying it all together
Tight integration has become a critical success factor, he adds. “What we are seeing is CRM, property management, booking, and loyalty systems all being packaged together.”
A central data repository plays a central role in allowing the connections between different channels and touchpoints that a customer might use, he explains. “All those touchpoints need access to the same data,” he adds. “All systems need to integrate with one another and exchange the correct type and amount of data between them [for CRM to understand what people need].”
Consolidation of data is one thing, he adds. “But you also want to be in as many places as possible to create scale and profitability. With integration you can use that information in the best way possible to create personalization.”
An independent approach
Large-scale integrated platforms do require considerable investment, making it that much more challenging for smaller operations, notes Pratt. “Traditionally it has been harder for smaller independents to get that level of integration. But [operators of all sizes] very much want CRM to support your entire ecosystem They need to have continuous engagement, before, at the time of purchase, at arrival and departure. Closing the loop for the guest journey is huge.”
Drake Hotel Properties has long faced the integration challenge in its CRM strategies. This year it has taken a major step forward in tying its systems together to improve its CRM capabilities, says Ana Yuristy, Chief Services Officer. “Big chains have huge platforms that do all sorts of cool CRM things.”
Until recently, the hotel had been working back and forth between separate booking tools, POS, and front-desk PMS to gather and integrate guest data. “We’ve always gone with best-in-breed solutions for each, but it was always a challenge lacing them together to determine guest preferences and conduct even simple email communications,” explains Yuristy.
She says the company’s different lines of business have always been rich sources for data. “But we didn’t have the ability to cross pollinate versus having one centralized CRM system to pull it all together.”
Adding to the challenge is that the Drake’s three properties (The Drake in Toronto, along with The Drake Devonshire and Drake Motor Inn in Prince Edward County) are distinct destinations that travellers choose for very specific reasons. By fully integrating the three properties through a single CRM strategy, Yuristy believes they can increase revenue opportunities to expose their guests to all their properties within the collection.
“That is one of our goals for 2023. We see opportunities for customer data mining with our direct booking and other systems to engage in some creative cross-pollination for our Prince Edward County properties, such as holiday parties or executive retreats for our Toronto regulars.”
With today’s competitive landscape and growing customer demand for personalization, CRM innovation will continue to play a role in hoteliers’ futures. “Organizations are trying to push through the next boundary to connect to the customers inside that they know and those outside the internet to draw them in,” says Pratt.
Krajewski says he is already seeing innovation being applied to digital channels through artificial intelligence (AI) and machine-learning tools. “That is the next evolution where hotels can differentiate themselves. We expect to see more automation in the way of chatbots and text services, for example.”
Today, there are AI tools that can track conversations as they happen and pop-up recommendations to agents in real-time to suggest offers that might benefit the customer. “This is being widely deployed at the really large chains such as Marriott,” he says.
AI capabilities could also automatically switch chatbot conversations to a live person if the technology is unable to answer their questions. “It can all occur seamlessly without the customer knowing,” says Krajewski.
Capabilities at this level may be out of some operators’ reach for now, but Krajewski believes solutions will be more accessible and cheaper in the near future. “It will become a down market in time. Of course, the changes will keep coming. That’s a big part of what we love about the industry.”
BY DENISE DEVEAU