RESEARCH @ BI: Customer strategy for hotels
It is not easy to please everybody. This also applies to hotels that live from as many satisfied customers as possible. Even though the guests are very different, they are often treated the same.
Hotels often fight a very aggressive battle to attract new customers by offering reasonable special rates. At the same time, regular guests often find that they do not receive any preferential treatment.
"Customer loyalty is not always rewarded. It can lead to dissatisfaction, and hotels risk losing some of their most profitable guests," warns Associate Professor Line Lervik Olsen at BI Norwegian School of Management.
Study of hotel guests
Together with Professor Tor W. Andreassen at BI Norwegian School of Management and Professor Michael D. Johnsen at the School of Hotel Administration at Cornell University, Lervik Olsen conducted a comprehensive study of 689 Norwegian hotel guests at an international hotel chain.
The researchers were concerned with charting differences in customer satisfaction among hotel guests, in relation to the strength of their relations to the hotel.
Are regular hotel customers concerned with the same issues as incidental overnight stays?
The results were published in an award-winning article in international academic journal Managing Service Quality (MSQ). The researchers were awarded MSQ's 2009 outstanding paper of the year award for this work.
The trio of researchers find that hotel guests' experience of happiness or disappointment has a great impact on whether the guest is satisfied with the stay or not. The price and quality of service are means used by hotels to affect guests' feeling of joy or disappointment.
It is easiest to please regular customers
In their assessment, customers with strong relations to the hotel, regular customers, balance their experience of price and quality associated with the stay. If the hotel's quality meets expectations, the price may actually be a source of joy for the customer.
It is much easier for customers with weak relations to the hotel to be disappointed with the stay, and they often identify faults with the quality of the services delivered.
"It is easier to please guests with strong relations to the hotel than incidental overnight stays," states Line Lervik Olsen, based on the study.
The dissatisfaction experienced by guests with weak relations with the hotel has a stronger effect on their (lack of) satisfaction than the positive emotions produced in regular guests.
Different treatment of types of guests
The study shows that it is not enough for hotels to distinguish between business travel, and the holiday and leisure market.
It is also smart to divide guests into groups in relation to the strength of their relations with the hotel, and to customize the service offering according to the different groups.
For guests with weak relations to the hotel, it is a matter of focusing on quality, in order to remove causes of disappointment and discontent. It is also important to take extra care of the regular customers, so that they remain happy, content and loyal guests.
Less effort is required to keep a profitable regular customer than to participate in the price war for the most fleeting customers.
Reference:
Johnson, Michael D., Line Lervik Olsen & Tor W. Andreassen (2009): "Joy and disappointment in the hotel experience: managing relationship segments” published in Managing Service Quality (MSQ) Vol. 19 No. 1. The article won MSQ’s outstanding paper of the year 2009 award.
Feedback:
Send your comments and questions regarding this article by E-mail to 
