...3(2): 297 – 316 (2009) ISSN 1823 - 836X Linking CRM Strategy, Customer Performance Measures and Performance in the Hotel Industry NOR AZIAH ABU KASIMa* AND BADRIYAH MINAIb b Graduate School of Management, Universiti Putra Malaysia Faculty of Economics and management, Universiti Putra Malaysia a Customer relationship management (CRM) has been increasingly adopted because of its benefits of greater customer satisfaction and loyalty, which in turn, leads to enhanced financial and competitive performance. This paper reports on a study that examines the relationship between CRM strategy and performance and determines whether the use of customer performance measures plays a mediating role in the relationship between CRM strategy and performance. This study contributes to the limited literature on CRM strategy since little is known about the use of CRM strategy and customer performance measures and their relation with performance in the hotel industry in Malaysia. Data were collected through a questionnaire survey of hotels in Malaysia. Hierarchical regression analyses on a sample of 95 hotels revealed that only the information technology dimension of CRM strategy has a significant and positive effect on performance. In addition, the hypothesis concerning the role of customer performance measures as a mediator was supported. Keywords: Customer relationship management strategy, customer performance measures, hotels, performance, mediator. JEL Classification Codes: M41,...
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...CRM IN HOTEL INDUSTRY WELCOMGROUP MAURYA SHERATON Customer Service is now more fashionably called Customer Relation Management. ITC Maurya Sheraton has been following an unstructured form of CRM with a narrow focus of serving the customer well and in a most efficient manner. The concept of Customer Relationship Management has a broader focus of not only serving the customer but also creating the customer and retaining him for measurable and substantial returns. CRM is a vast subject where the concept of one to one marketing is supported by Database Marketing. MAURYA SHERATON DEFINES CRM AS “Customer Relationship Management is a process of managing customer relations in an organized way”. They aim at managing “each moment of truth” that is experienced by the customer. According to Mr Hariharan there are various contact points where the hotel comes in direct contact with the customer which are known as ‘Touch points’ in the CRM language. These touch points are considered important as there is direct interaction with the customer and they provide valuable input to the hotel. The input provided by the customer has to be captured in such a way that it becomes information and can be used by various processes within the hotel. This can be done with the help of technology and the aim is that whenever there is a customer interface with any of FIELD PROJECT CRM IN HOTEL INDUSTRY those processes they are able to use that information...
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...the value of a brand in the lodging industry? Hilton Hotels Corporation is a global hospitality company. Perhaps it is the most recognizable name in the lodging industry. Hilton offered significant recognition and customer traffic with their advertisements, programs and electronic distribution systems. The company is responsible for delivering the guest experience on property and abiding by the brand standards. Brand values have a lot to do in lodging industry. For instance two companies selling similar product at a same price. Yet people tend to buy one product more. If the question is why the answer is brand value of the product. There are various aspects that determine a brand value. This can be quality, premium price, higher market share or even a positive image. In the case of lodging industry, once the customer have a bitter experience with the service they are never going to come back to stay at the same place anymore. The brand value in this industry is more over attained through word of mouth. If a customer gets a quality service obviously he will recommend the place for his known one’s too. That’s how a strong brand image is built in lodging industry. The brand should create values in customers mind by helping to assure them of a uniform level of quality. Then the customer becomes loyal to the brand. 2. Evaluate the performance of the Customers Really Matter initiative to date. The nervous system of Hilton Hotels Corporation was a comprehensive and...
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...MANAGEMENT INFORMATION SYSTEM ANALYSIS ON THE PAST AND THE FUTURE OF HILTON HOTELS Spring Semester, 2015 1. EXECUTIVE SUMMARY In this report we analyze Analysis on the past and the future of Hilton Hotels. The first part of the report concentrated on the literature review about Hilton Hotels’s background, followed by analysis of the past and the future of Hilton Hotels in the second part. In order to create linkages, we chose the core related their strategy in Hilton Hotels like OnQ and Customers Really Matter (CRM). 2. LITERATURE REVIEW Hilton was the most internationally recognizable name in the lodging industry, in large part due to the role that the Hilton family had played throughout its history. The company went public under the name Hilton Hotels Corporation in 1946, with a portfolio of 15 properties in 11 states. A strong commitment to economies of scale was made in 2000 with the acquisition of Promus Hotel Corporation, a transaction that pushed Hilton close to the 1,700 properties mark. Promus Corporation originally incorporated as Holiday Inns of America in 1954, focus on franchising and managing brands after selling its Holiday Inn division in 1990. In 2005 Hilton Hotels bought back Hilton International, bringing about 400 Hilton properties into the fold. Organic growth also continued, and in September 2006 Hilton announce the opening of the 1,000th hotel in North America since the acquisition of Promus. Poised to break the 3,000 properties mark, with a presence...
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...Hilton Hotel Corporation The Hilton Hotels Corporation, one of the leading international companies in the hospitality industry started with a humble beginning in 1919, when Conrad Hilton bought the first of what would later become an international chain of hotels and resorts, revered by competition and valued by customers, for the high quality of hospitality and leisure services provided as well as original hotel and travel concepts presented. With an international portfolio of 9 hotel brands that extends to up to 79 different countries worldwide, the Hilton hotel corporation has more than 3,400 hotels spanning the globe and approximately 22 million guests across all nine brands owned by Hilton. The goal Hilton aspires to achieve however is to be the first choice of guests, team members and owners alike, the paramount global hospitality company, which is reflected solidly within the company’s core values which are the drive of the corporation’s team members. H HOSPITALITY I INTEGRITY L LEADERSHIP T TEAMWORK O OWNERSHIP N NOW (Hilton worldwide, 2009) Through creating exceptional guest experiences, Hilton was able to ensure that each customer is made to feel valued. Challenges However, with an increasing number of competitors in an aggressive and quite competitive market, A diverse number of properties in 79 around the world, each with unique cultural norms and traditions and a changing hospitality market, due to the increasing bargaining power customers...
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...Hilton core business: Hilton Group of hotel is one of the renowned names in the lodging industry. With close to 3000 properties and 500,000 rooms in 78 countries, it is among the top most brands in the hospitability sector. It is a brand management company, catering to the needs of millions of travellers around the globe. With about several billion dollars of real estate invested in Hilton brand of hotels, it offers distinct products across a whole range of consumer segments. Being a brand management company, Hilton hotels own many properties and also franchises its brand name to the property owners who chooses to invest with them. While offering its brand, Hilton wishes to create a unique standardized experience for all the customers across the world. At the same time, Hilton offers property owners an immediate recognition, more footfalls, advertisements and other branding benefits so as to have the best guest experience associated with the Hilton Hotel Brand name. Hilton competitive advantage lays on both its size and diversification as it is present in almost all the segments of the industry. Unlike their competitors who are either big but less diversified or are diversified but lack presence in all segments, Hilton brands offer whole gamut of products in all segments. As per my analysis Hilton hotel is mix of both sales oriented and market oriented firm with the belief of putting customer needs first. Their Customer Really Matter initiative and the subsequent OnQ program...
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...Hilton Case Executive Summary As the most recognized brand name in the lodging industry, Hilton is a diversified cooperation for its strong presence in all segments of hotels, casinos and vacation ownership. In terms of organizational strategy, Hilton Hotels Corporation relies on its scale, gaining members through its loyalty program and continuously expanding its hotel network. Beginning with acquisition of Promus Hotel Corporation, It now owns, manages, or franchises a portfolio of brands which includes Waldorf-Astoria Collection, Conrad International, Hilton Hotels, etc. With the focus of Customer Really Matter strategy, Hilton Hotel Corporation has invested much in CRM since 2002 aiming to build a broad customer base and the premier global hospitality business. Hilton Hotels Corporation considers customer as the most important component of their business, so they developed objectives to build a close long-term relationship with their customers. To provide consistent and outstanding service to its customers, the CRM initiative was primarily focus on its four categories of Best Guests: members of Hilton Honor program, 4+, Fast Rez members and local VIPs. Hilton achieves this tight relationship through recognition, personalization, service recovery, and customer analysis. Refer to the endnotes ix and x, the net revenue per call is a measure of efficiency of call center and that the conversion ratio measures how many calls were “closed” turning callers into bookers...
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...MANAGEMENT IN HOTEL INDUSTRY BY DATA MINING TECHNIQUES MIRELA DANUBIANU, VALENTIN CRISTIAN HAPENCIUC Mirela DANUBIANU, Lecturer Ph. D. Eng, Ec. “Stefan cel Mare” University of Suceava Valentin Cristian HAPENCIUC, Associate Professor, Ph.D. Ec. “Stefan cel Mare” University of Suceava Keywords CRM, data mining hotel industry 1. Introduction It’s a fact that a successful company not only put customers first, but put customers at the center of the organization because the changes in customer behavior determines unpredictable profitability and may be the cause for inefficient marketing planning. The main goal of CRM is the capability to handle customer interaction across different channels and functions, for building loyal and profitable customer relationships. Although cost cutting and competitive pricing strategies may attract customers from competitors, in many services industries price advantages are not a sufficient reason for customers moving between suppliers. In these situations successful competitive strategies include developing strong relationships with customers and cross-selling them other services. Data mining - techniques for exploration and analysis of large quantities of data in order to discover meaningful patterns and rules - helps businesses sift through layers of seemingly unrelated data for meaningful relationships, where they can anticipate, rather than simply react to, customer needs. 2. An overview of CRM Customer Relationship Management (CRM) is an enterprise...
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...Marriott International is the current leader in the hotel/lodging industry. Founded in 1927, by J Willard Marriott, and his wife Alice, it had its beginning as the first A&W Root Beer franchise. By 1957, Marriott made a historic move into the hotel industry, opening their first hotel in Arlington, Virginia, under the management of their son, Bill Marriott. (Marriott International, 2015). Between 1957 and 1985, the Marriott Corporation had expanded into Mexico, began providing lodging for the cruise industry, and debuting the first Courtyard hotel. Between 1986 and 2011, they acquired several more hotels, including Fairfield Inn, Residence Inn, Renaissance, Executive Stay, and 49% of the Ritz-Carlton Hotel Company. By 2012, Marriott had added an additional five hotels after acquiring Gaylord Hotels Brand, bringing the current number of properties owned by the corporation to 4,300, in 81 countries (Marriott International, 2015). Most of its current properties are franchised, with the Marriott family owning about 30% of the corporation (Yahoo Business). Marriott International, Inc. is one of the leaders in lodging, and is currently headquartered in Bethesda, Maryland. They have made their mark worldwide, as operator, franchisor, and licensor of hotels and timeshare properties. Under its current model, the hotels are typically franchised, rather than owned. “At year-end reporting, in 2014, of the total number of hotels available worldwide, Marriott operated 41 percent...
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...Relationship Management CRM is a customer service management database that holds guest information and then can tell you what the guest’s likes and needs are. This is best used to anticipate a guest’s preferences before they arrive for a stay at your hotel. A true CRM is based more on recognition of the guest than on rewards that can be given to that guest (Nyheim, et al, 2005). A true CRM program is all encompassing when it comes to the information on any individual guest, from check-in to marketing. A CRM is best used when all aspects of the hotel staff are trained in its use. The information in the CRM comes for history with the guest, staff observances, and guest interactions with all touch pints within the hotel. With all the information gathered on a regular basis, the staff can look at the guest’s folio to find what their references are. This helps to prepare the staff for that guest’s arrival. With today’s reliance on the internet and social media the CRM helps hotels to now market to an individual rather than a mass group of people (Nyhiem, et al, 2005). The CRM allows the hotel to keep information on each guest. By using this information the management team can be better prepared to try and keep a repeat customer by showing the client that they care what the guest thinks and how to go about making them feel relaxed and welcome. References: Nyhiem, P. D., McFadden, F. M., & Connolly, D. J. (2005). Technology strategies for the hospitality industry. Upper Saddle River...
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...With most competitors moving ever faster, the race will go to those who listen and respond more intently”. -Tom Peters, Thriving on Chaos Chapter 1: Conceptual Framework for CRM What is Customer Relationship management? Before we begin to examine the conceptual foundations of CRM, it will be useful to define what is CRM. A narrow perspective of customer relationship management is creating a team relationship among sales, marketing, and customer support activities within an organization. Another narrow, yet relevant, viewpoint is to consider CRM only as customer retention in which a variety of after marketing tactics is used for customer bonding or staying in touch after the sale is made. Shani and Chalasani define relationship marketing as “an integrated effort to identify, maintain, and build up a network with individual consumers and to continuously strengthen the network for mutual benefit of both sides, through interactive, individualized and value-added contacts over a period of time”. The core theme of all CRM and relationship marketing perspectives is its focus on co-operative and collaborative relationships between the firm and its customers, and/or other marketing actors. CRM is based on the premise that, by having a better understanding of the customers’ needs and desires we can keep them longer and sell more to them. Growth Strategies International (GSI) performed a statistical analysis of Customer...
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...PICCOLI CHEKITAN DEV op yo Hilton Hotels: Brand Differentiation through Customer Relationship Management In early 2008, Hilton Hotels Corporation was poised for tremendous global growth—with an aggressive goal of opening 1,000 hotels in North America in five years and 1,000 hotels in the rest of the world in ten years. The company had just been taken private by the Blackstone Group1 for a reported $26 billion, a 32% premium over the $32.05 share price the day prior to the announcement. The takeover announcement by Blackstone clearly framed the road ahead: “Blackstone intends to invest in the Hilton properties and brands globally to enhance and grow the business for the benefit of owners, franchisees, and customers... This transaction is about building the premier global hospitality business.” tC But growth would not be easy in the highly competitive global lodging business. Challenges in this market historically included access to capital, high levels of employee turnover, and difficulty achieving standardization typical of service delivery operations. Improving service delivery and consistency across the family of Hilton brands had been the major focus of the Customers Really Matter (CRM) strategy that the firm launched in 2002. With five years invested in CRM, the Blackstone acquisition provided the opportunity to evaluate the results to date and to devise an action plan going forward. Hilton Hotels’ Background Do No Hilton was perhaps...
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...Page 1 Introduction…………………………………………………… Page 2 Literature Review…………………………………………….. Page 3 – 4 History and Development of CRM………………………..... Page 4 – 5 CRM in Action………………………………………………... Page 6 – 7 CRM and Competitive Advantage…………………………. Page 7 – 9 Implementations Considerations and Recommendations. Page 9 Conclusion……………………………………………………. Page 10 References…………………………………………………… Page 11 – 13 Abstract For our research paper, we’re going to focus on customer relationship management and how it plays a role in a company’s consumer base and profits. The cycle of CRM is primarily divided into four parts which are marketing, sales, support, and feedback. We’re going to look into detail at all four of these components and how they correlate with one another from an organizational aspect. We’re going to be looking at CRM through the eyes of the seller, the person behind the counter. We want to know how this information technology helps the organization and in what ways does its performance project competitive advantage. There are many different systems of CRM such as operational CRM which focuses primarily on the marketing, sales, products, and services of the company. Another system is analytical CRM which focuses primarily on the database and how the management uses it to make important decisions for the company. According to scholars, “Analytical CRM involves using firms’ data on its customers to design longitudinal models of choice over the breadth of the firm’s products...
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...Hilton Case Executive Summary As the most recognized brand name in the lodging industry, Hilton is a diversified cooperation for its strong presence in all segments of hotels, casinos and vacation ownership. In terms of organizational strategy, Hilton Hotels Corporation relies on its scale, gaining members through its loyalty program and continuously expanding its hotel network. Beginning with acquisition of Promus Hotel Corporation, It now owns, manages, or franchises a portfolio of brands which includes Waldorf-Astoria Collection, Conrad International, Hilton Hotels, etc. With the focus of Customer Really Matter strategy, Hilton Hotel Corporation has invested much in CRM since 2002 aiming to build a broad customer base and the premier global hospitality business. Hilton Hotels Corporation considers customer as the most important component of their business, so they developed objectives to build a close long-term relationship with their customers. To provide consistent and outstanding service to its customers, the CRM initiative was primarily focus on its four categories of Best Guests: members of Hilton Honor program, 4+, Fast Rez members and local VIPs. Hilton achieves this tight relationship through recognition, personalization, service recovery, and customer analysis. Refer to the endnotes ix and x, the net revenue per call is a measure of efficiency of call center and that the conversion ratio measures how many calls were “closed” turning callers into bookers...
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...Name of Sales Professional Interviewew 1) What is the Sales Job Title and Description? Nuqleo Regional Sales Manager for Latin America & Caribbean at Accvent, LLC. Oscar works in the information technology industry and specializes on requirement analysis, development of business plans, process flow, business process, and performance measures. 2) What are the top three (3) job responsibilities for the sales person? Training: Oscar travels throughout Latin America and Caribbean not only to meet with clients but to provide the necessary training on products to the staff of 12 sales managers he oversees. Customer Breadth: Oscar utilizes every opportunity to expand his client portfolio. Line Gross Profit: it’s all about how much money you are making the company. Oscar has to keep his team motivated to sell and keep a close eye on the numbers. 3) What is the structure of the compensation for the sales person? Is there an upside opportunity? What are the downsides? Oscar’s compensation is 80-20. His income is $100,000 per year of which 80% ($80,000) of it, is his salary and the remaining 20% (20,000) is similar to a bonus and it is calculated according to his sales performance. The downside is that if he does not meet the bottom line, he won’t get the 20% bonus. Also, he has to travel three weeks out of the month and it’s difficult to balance family time. The upside opportunity is that there is an accelerated compensation, if he exceeds his sales goals where according to the amount...
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