The Different Types of Guests You Can Expect in a Hotel and How to Deal With Them

Guests come in all different shapes and sizes, and it’s important to understand what type of guest you’re dealing with in order to ensure you are giving them tight best service according to their needs.

Classifying the different types of guests

There are different ways of classifying hotel guests based on:

  • The purpose of their visit
  • Origin
  • Size of the group
  • Age group

Purpose

Depending on the purpose of their visit, they could be classified as:

Tourists:  The most common type of guests are tourists. According to the National Travel and Tourism office, more than seventy five million tourists visited the U.S. in 2016. Travel and tourism is a major contributor to the GDP with a total contribution of more than one trillion dollars in 2015. Not only is tourism important for local and national economies around the world, it is also a major contributor towards the global economy. According to Statista, tourism contributed over seven trillion dollars in 2016 to the global economy.

About 60% of people travel for leisure that can include sightseeing, recreation, visiting or other non-business activities. Leisure travelers that included both international and domestic travelers spent $660 billion in 2014 in the U.S.  The travelers are price sensitive, focused on getting the best hotel experience and expect to be made to feel at home.  Tourists can include a group of friends, families or group tours where the package includes tours and accommodation and one or all of the meals at times.  The recent trend also highlights the popularity of travelling solo.

Business travelers:  About 40% of guests are business travelers, according to a report from the American Hotel and Lodging Association (AHLA). While tourists usually travel in groups or with families, business travelers often travel alone. These are not as price sensitive as tourists and may be willing to pay more for the convenience and location of the hotel. The business traveler is also concerned about how well the hotel handles messages, conferences or meetings. Internet speed, computers, free Wi-Fi are some of the features that the business traveler is looking for.

Delegates and conventioneers: Attending seminars, trade fairs, conferences, delegates and conventioneers can be in groups or could include a solo traveler.

Health tourist: The recent focus on health and relaxation has led to the advent of the health tourist looking to rejuvenate with yoga, spa, meditation or other natural and holistic healing methods. According to a HVS report, 17 million travelers in 2014 were focused on ‘health and wellbeing’, and 40% of these were regular travelers. The “wellness tourists” are willing to spend 130% more than the average traveler according to an estimate.

Size matters!

Depending on the size of the group, they could be classified into:

Families: Families could be looking for a short break with a weekend getaway or could be in for a long and relaxed summer vacation. More often than not, the families include kids of all age groups and child friendly facilities are what they are looking for.

The solo traveler:  The solo traveler can be a business traveler or an adventure tourist. He or she could also be a VIP or an important international delegate.

Origin

Depending on their origin, guests can be classified as domestic or international travelers. The other way of classifying the guests could be on the basis of their age group. The Millenials are expected to account for 50% of travelers to the U.S. by 2025. This group is comfortable with technology and look for convenience in terms of keyless doors, internet of things, robot room service and much more. The elderly of course need facilities that cater to their special requirements.

Prevention is better than cure!

No matter what the origin, purpose or size, guests expect to be treated as priorities and want to get the most out of their stay in the hotel. Anticipating the needs of each type of guest and making the necessary arrangements beforehand will minimize complaints to a large extent. As in everything preventing complaints is better than dealing with them!

Some basic amenities that the hotel must provide obviously include a convenient check in and check out procedure, cleanliness, quick response to queries or complaints, pleasant dining experience and courtesy of the staff.

Tourists expect the convenience of a hotel pick up for their day tours while wanting to taste the local cuisines. Business travelers expect quick and efficient service, good internet speed and Wi-Fi among others.

Dealing with difficult guests

It may not be possible to anticipate every need of different types of guests and some guests are more demanding and hard to please. Dealing with angry customers requires patience and loads of training! Experts recommend using the following strategies to handle difficult customers:

Listen to the customer: It is important to lend a patient ear while the customer is voicing the complaints. Interrupting or not paying attention can make the situation worse. Allow the customer to explain at length the nature of the problem. The idea is to focus on the problem and not the person. If possible, lead the guest away from the area where there are other guests within earshot. If the problem is genuine, contacting the relevant staff to address the issue immediately is the best way to deal with the situation.

Resolve the issue in their favor: There are some difficult to please guests who are not satisfied with any resolution. Statistics show that 70% of the guests return to a hotel where a former complaint was resolved in their favor.  Providing a positive experience with a free upgrade, breakfast or dinner offers great return on investment in the long run as the guests are likely to not only revisit but recommend the hotel to others.

Ask for a solution: An irate guest may not be satisfied or appeased with a free upgrade or meal offer. If nothing else works with the angry customer, asking him or her for a solution to the problem politely could be the best way to deal with such difficult guests.  Once you fulfil the guest’s request, following up on the issue will make the guest feel special and valued. According to an estimate, 12 positive experiences are needed to compensate for one negative issue that is unresolved.

 

 

 

 

 

 

 

 

Engage Guests with Loyalty Programs

A loyalty program, as you might already know, offers discounts to regular customers when they choose to make purchases again.

Does this make sense in the hospitality industry?

One might be tempted to think that this translates into a loss of revenue. And in the short run, it does. But the hospitality industry is not something that will fold up if it doesn’t meet its quarterly or short-term goals. It is there for the long term. So it makes sense to have a loyalty program for your guests.

How the numbers stack up

The hospitality industry is largely fragmented, with a mix of both upscale and budget properties, as well as everything in between. So there is really no one-size-fits-all. Every loyalty program must be tailored according to the clientele as well as the size of the property.

A few case studies might help you understand how loyalty programs work in the industry.

  • The InterContinental Hotel Group, or IHG for short, had 92 million customers enrolled into their loyalty program (‘IHG Rewards Club’) by the end of 2015. This marked a 10% increase from the previous year, which saw 84 million signing up.
  • The Ritz-Carlton is part of the Marriot group, so both hotel chains have a combined rewards program. Those who sign up can use their points earned at either chain. It had 49 million such customers at the end of 2014. This figure jumped by 10.2% in 2015 to reach 54 million.
  • The Hilton had 51 million enrolled into their HHonors program in 2015, which was 15.9% higher than the previous year.

Those who are members of the program can expect a 30% discount in 11 chains across 102 countries when they book directly.

  • The biggest gainer was Wyndham Hotels and Resorts. Their figure in 2015 was 45 million, up from 32.2 million. This corresponds to a 39.7% change.

Notice anything interesting? The number of people who enroll into loyalty programs is increasing.

But this does not mean all of them will take advantage of the points they have accumulated. In fact, the highest that loyalty scheme members actually make use of is 50%. Both the Marriot-Ritz Carlton and the Hilton saw this, as well as Starwood, with the Hyatt clocking only 31%.

So your potential losses may not be as high as you think. Far from it, it may be to your advantage.

Hotels offer reward points on the amount of dollars spent, not for the number of nights stayed. The psychology behind loyalty programs is that the more points a customer or guest receives, there is more incentive to redeem them. This pushes him/her to make more purchases than he/she normally would. Since the points earned can be applied to only part of the booking / purchase, there is still a profit to be had, even with the discounted price. From the customer’s point of view, this pushes him into making more purchases, effectively starting off a cycle.

“On average, a hotel guest enrolled into a loyalty program spends $41 more per night.”

Cornell University, which discovered this fact, also found that loyalty program customers result in 50% more revenue to hotels than who are not enrolled into loyalty schemes. This explains why all major and small hotels are trying to get their loyal customers to be more active.

‘Discounted’ pricing on room bookings is not always discounted. It applies only when customer choose to book directly. The difference between this and booking sites can at times be as high as 20%. So when you offer a 30% discount, you stand to make a loss of 10%. But this is more than offset by the additional purchases the customer makes, and so you end up earning more money at the end of the day.

A lack of ‘personalization’ is the number one complaint of all customers. It can make a lot of difference to them when they don’t have to provide all their booking details again. If you want to truly set up a loyalty program that will see activity, consider co-branding your loyalty card with services that hotel guests are most likely to use – like car rentals and airline tickets. That is to say, points earned on how much they spend with you also gets them discounts with these services (and further points as well).

A new customer costs seven times as much to acquire than a loyal / returning customer. So loyal customers are your best bet. They spend 67% more than new customers as well.

The Importance of Brand Loyalty

Brand loyalty is the ultimate dream for every hotel, as well as the most difficult challenge to overcome. At a time when there is so much competition, with each hotel vying with each other for popularity in terms of their services and amenities, it is very hard for hotels to actually capture the hearts of their guests and make sure that they become brand loyal. Impressing a guest with great services is one thing. But to make them stay, and want to return is another altogether!

Brand loyalty has the element of emotion in it. This means that the guests actually ‘love’ the hotel so much that even when offered better alternatives, they would still prefer to stick to the hotel brand they are loyal to.

Often, hotels fail to create brand loyalty because they do not appeal to this ‘emotional’ element of their relationships with their guests. This achieved when hotels stop seeing the guests as simply customers, but as part of their family. When this perspective is what guides the hotel’s policies and facilities, the seeds of brand loyalty are sown in the hearts of the customers.

Brand loyalty is always spoken of in terms of emotions and feelings because the strongest motivator behind human behavior is emotion. It is this factor which distinguishes man from other animals. As such, the core idea that must guide every decision that the hotel makes should be that they have to touch their guests’ hearts, not just their minds. Capturing the mind does not have a permanent effect because the guests can shift their loyalties other hotels easily. This is more difficult to do than it sounds! But it is definitely not impossible to achieve.

Here are some practices that can help create brand loyalty towards you:

  • Tailor-made, personalized service

Wants and needs have become so complex today that people have highly specific needs. If you can identify these needs and offer services which show that you have taken the trouble to make your guests feel special, it can do wonders for your hotel. Even very simple gestures such as offering a complimentary cake of a flavor that the guest likes on her birthday (provided the guest is staying at your property on that day, of course) can be a wonderful gesture.

 

  • Going beyond what is needed

Your only way to get an edge over your competitors is if you offer services that go beyond what would usually be expected of you. For example, reaching the guests’ luggage to their rooms is what they would expect of you. However, giving them a complete list of flight timings even (if you know they are planning on flying next) even without them asking is to go beyond what is required.

 

  • Avoid turning down requests as much as possible

Turning down a guest’s request is a big taboo in the Hotel Industry. It is always a better idea to give in to certain extra requests by the guests, provided it is not very unreasonable. There may be emergency situations that can create needs for the guests that your hotel policy does not allow. In such cases it is always a good idea to give up rigid adherence to hotel policy and thinking from an emotional perspective. This is a sure way to creating brand loyalty towards you.

 

  • Extreme patience and cheerfulness

No matter how cranky and annoying a guest is, the fact is that as long as they are on the property, he is your responsibility and is the prime reason for your hotel’s business. Although it can be very trying at times, under no circumstances, except when absolutely necessary can the hotel staff be mean, sarcastic, or rude to the guests. Even if a point has to be repeated over and over again, it should be – with a cheerful demeanor. This will not go unnoticed.

 

  • Focusing on relationship-building rather than profit maximization

A number of hotels, as well as other businesses, make profit their prime focus. Business meetings with profit as the focus can lead to decisions that are fraudulent and unethical. Although this may generate a lot of profit in the short term, it is a sure way to create a disastrous future for the hotel.

On the other hand, when building relationships is the focus, profit making is slow but steady and permanent.

 

  • Treat employees well

The ultimate way to make sure you create brand loyalty is to treat your employees well. A happy workforce will ensure a happy crowd of guests. And a happy crowd of guests will generate a lot of goodwill towards your hotel. If you take care of your employees well, they will gladly go an extra mile for your guests.

 

 

How important is Customer Lifetime Value to your brand?

How absurd is it that I’ve been treated better as a new customer than as a loyal member? What do I mean by that? Well the attention and service I received as an occasional customer is incomparable to the way I was treated after I became a loyal member. It’s so absurd that I canceled my membership just to be recognized as a new customer again. And it’s a shame, because these companies lost so much potential revenue by missing the opportunity to reap the benefits that a loyal customer can bring.

The potential revenue that a customer will generate during the lifetime of doing business with you is called customer lifetime value. In general, CLV is an important metric for businesses who need to understand how much they want to spend on bringing in new clients, and how much exciting clients can bring in. If you are looking to improve retention rates in your business, the CLV is your most crucial metric.

By calculating CLV you can find out important information which can help you decide how to allocate your resources for marketing, customer retention and other areas so you can get the best possible return for those resources. For example: you can use CLV data to help build more accurate and detailed customer personas. Customer lifetime value helps you spend advertising and marketing dollars wisely, so eventually you get the highest profit to your company.

Products and services may be easy for competitors to copy, but a company that is good at creating customer loyalty is less vulnerable to attacks from competitors; and brand loyalty is much more difficult to copy.

So don’t just focus on bringing new clients in. Focus on the ones you already have. They could be the key to the success of your future.

The Value of a Happy Guest

Common knowledge tells most business executives that happy customers are the best customers. In fact, there’s even a slogan for it: “The customer is always right.” But how much value does a satisfied guest actually bring to a business? There have been numerous studies done on this exact topic, and the results are pretty impressive.

Happy Guests Drive Sales

When a guest is satisfied, they’ll come back. Obviously, this means more revenue for the company. However, until now, there was no quantifiable way to judge how much more these guests will spend. A study by the Harvard Business Review states that it’s much higher than previously estimated: Customers who have great experiences spend roughly 140 percent more than customers who have poor experiences. Experiences were ranked on a scale of 1 to 10, and the numbers work on a sliding scale – the higher the satisfaction rating, the more the customers spend. The largest jump happened when customers were most satisfied. At a level 9 rating, customers spend about 1.9 times more than those with a level 1, 2 or 3 experience.

Happy Guests Are Repeat Customers

Studies also show that happy guests tend to be repeat customers. After all, why would they go somewhere else when they had a great experience at the last place? This is obviously represented in the sales figures above, but it has another benefit as well: It’s much cheaper and easier for a business to retain customers than it is to find new ones. The White House Office of Consumer Affairs states that it costs 6 to 7 times more money to attract a new customer than it does to retain an existing one.

How Do Businesses Know If Guests Are Happy?

The statistics speak for themselves: Happy guests are valuable. But how do executives know if the guests are happy? It may be harder than you think. Ruby Newell-Legner, a customer satisfaction expert, states that businesses only get feedback from 4 percent of dissatisfied customers. What happens to the other 96 percent? Well, 91 percent of them never come back. However, that doesn’t mean they aren’t telling others about their experience. Though only 4 percent will tell the company, over 13 percent tell 10 to 20 other potential customers. In addition, for every negative guest experience, it takes seven to 12 positive ones to make up for it. That’s why companies need to be proactive and prevent negative guest experiences in the first place.

Handle Dissatisfied Guests Before They Leave

Obviously, all negative experiences aren’t preventable. The next best action is to handle the situation before the guest ever leaves the premises. This will require regular monitoring to ensure guests are happy, and it will also require standard procedures for handling complaints. It may sound like a lot of trouble, but it’s much easier today than it was in the past. Thanks to technology, there are numerous ways to keep track of guest complaints, so personnel can remedy the situation immediately. There are also ways to track satisfied guests, giving hotels an opportunity to further increase revenue.

Final Thoughts

It’s clear that a happy guest is incredibly valuable to any business, and that may be even more true for the hospitality industry. Hotels that strive for high customer satisfaction should implement a strategy for finding dissatisfied guests and solving the problem before it affects the company’s reputation and bottom line.