Monday, October 28, 2013

Marketing & Customer excellence: how could the Indian hospitality industry potentially get to the top of the world...


As I just returned from a 10 days trip though India, I got to stay in various hotel and realized that the Indian hospitality industry holds a very unique key to being the best model in the world. Having worked for a few hotel groups around the world (from Intercontinental to Starwood and Marriott), I couldn’t help myself , everywhere I would check-in, from having my brains in professional mode when it came to customer experience & hotel management : despite a few key areas of improvement, I realized that the hospitality groups in India (Oberoi, Taj, Leela etc...) could potentially possess the most powerful & winning combination of art & science when it comes to Customer satisfaction and could inspire many other service industries (airlines, banking...) in the quest for Customer Service Excellence.
However, at a time of economic pressure , less-than-expected growth in inbound travel, devaluation of the Indian rupee against the US dollar  and room supply overshooting demand, the need for India’s hospitably  industry to better structure & optimize its revenue structure & operations is pressing whilst its inherent superior assets could be better utilized...


 
First, focusing on the assets that have been mastered:

1.    Beauty : they generally own or build /operate magnificient palaces: from a Maharajah palace in Rajasthan  to an utra modern building In Mumbai or a renovated boutique Haveli in Chennai, how many countries can boast so many real estate treasures per km2 ? These gems are generally located in gated areas that offer an oasis apart from the surrounding bustle & hustle. Even for the most recent constructions, there is a clear resolve to reminisce of a past splendor & architecture, sometimes with success, but always with lavish materials & volumes...These groups rarely go stingy on land, marble, flower arrangements,  plush fabrics or antique furniture in a country where these supplies and best artisans are available at a very reasonable cost...

 
2.    The Indian culture of hospitality is a tradition and comes from the heart: based upon the Sanskrit saying “Atithi Devo Bhava  meaning "the guest is God", this fundamental principle of Indhu culture is shown in a number of stories where a guest is literally a god who rewards the provider of hospitality... The word ‘Athiti’ defines the guest as a person who could show up at home without a prior notice or formal invitation and on a day and time of his own choice...This is a defining trait of the Indian identity and still engraved in modern India.
 
3.    the importance of traditional / old-world good manners, dedication & humility : probably influenced by the 200 years British rule, both fair practice of English & sense of proper etiquette are more common among all classes of personnel that in many other countries, let alone other former Commonwealth nations such as Canada, Australia or in Africa...But more importantly, you get the sense that “Yes. Sir”, “certainly” or “You are welcome” are truly meant: that, when anybody addresses you, they don’t -and shouldn’t- feel inferior or demeaned by their show of respect & humility but rather expecting the same from you: it’s a win/win relationship ! Now, try picturing this in France , Mexico or Brazil, or even the USA, you soon realize that the general sentiment & attitude would be quite different, whatever the training & corporate policies in place. Another reason might also be that, for most Indian employees at almost every level, their job in the Hospitality industry is a real career choice and true social accomplishment not a simple gig between two jobs in order to pay the bills... this is probably why it makes sense and is profitable in the long term for Indian based hospitality industry to invest so heavily at every level in training for staff that will generally stay with the company for years or their entire career unless they cross over to the competition... That’s no coincidence that, for instance, The Oberoi Centre of Learning and Development (OCLD) was established almost 5 decades ago and has management training programmes that are considered among the best in Asia and a benchmark for international excellence within the hotel industry.
 

However, despite these very unique qualities, I also found  that beyond these irreplaceable assets in the art of hospitality, some other areas & more technical skills in the science of the trade seem to be missing in action or underutilized...At a time when many Indian joint ventures with Western groups are dissolving under the economic pressure that the country is going through, a pro-active charting & consolidation of these strategic skills could help Indian hospitality groups grow more efficiently by unleashing more profitability and  an optimized customer experience , helping to consolidate what could become the most powerful marketing mix in the global hospitality industry landscape:


 

 

1.    Customer Relationship management:  analytics, technology & marketing utilization: whereas most of American hospitality industry has learned in the past 5 years how to fully harness the power of segmentation & analytics when it comes to identifying the most profitable customer groups & the respective drivers of their satisfaction (rewards, personalized perks, discounts & promotions etc...), it seems that very few of these tools are actually formatted and brought to hotel’s front office employees so that it can inform their interactions with each customer: where is  the Customer Acquisition & retention strategy ? In a market that caters to so many different types of clientele –from experiential travelers who want to experience the country by themselves to segments like MICE , leisure, honeymooners, junket , Adventure or religious tourism...- how do you make sure that you properly identify, target & retain the most profitable / valuable segments , address customer pain points & moments  of truth for each brand while avoiding cannibalization within  the same portfolio...? Where is the Customer loyalty framework for Heritage or value segment customers when it comes to establishing a long term relationship & dialogue with a new guest after their first stay ? Where are the specific offers or advantages that will nurture repeat and brand preference ?  Where are the data related to a customer’s history & profile when it comes to anticipating their personal preferences, habits & expectations so that , whatever the personal memory or talent of some specific staff, they always feel welcomed & recognized as valuable & individual guests rather than a sheep among the herd ? All things that the global Airline industry, rental car or some US-based hotel chains have long scaled in order to maximize revenues & their share of Customer Lifetime Value...For instance, SAS, the Scandinavian airline, which uses its CRM systems to identify all the passengers who are flying on the airline for the first time, build a profile of the customer using social media and other third-party information: when the customer checks in for their flight, they are given a small gift based on what the airline learned about them.” A person whose social media feed indicates an interest in athletics might be given a sports bag, for instance...

 
It’s telling that, after staying as a guest in 10 different hotels belonging to various International chains, I was never exposed nor prompted at no time to enroll (from booking to check-in to after stay...) in any loyalty program or club ! How do you keep the positive memories of my stay alive and capitalize on the magic & unique experience that I just went through ?? Where are, beyond the one email offer for discount to the same hotel (how am I likely to soon return to India from the US and in the same Rajasthan hotel ? ) rather than making me a concrete offer for an hotel on the continent of my residence...?

 

2.    Empowerment/flexibility in decision making: both a result of training but also better suited tools and customer intelligence availability, the capacity of customer-facing managers (food & beverage, Spa, rooms..) to better predict, track & manage specific customer preferences or expectations can make a difference in the efficiency of day to day operations as well as in the delivery of an appropriate experience...But for that to happen, there is also a deeper need for staff & managers to be AND feel empowered so that they can adapt to real time situations or requests and react on the spot - as it is generally the case in European or American hotels- by making the appropriate judgment call without having to go to their direct report below a certain stake level...

That’s where the right balance between established procedures and adaptive judgment /flexibility needs to be taught on the basis of specific examples and situations...This is how junior employees & managers will strive, grow and acquire the customer centric mindset & adaptability that generally help better motivate & incentivize teams but also deliver better customer satisfaction at every level of the organization. There might be a cultural shift & adaptation here for Indian personnel that will only happen with the right user friendly tools but also with the right training...Radisson Hotels were known as one of the first to initiate a full scale employee empowerment by removing the upper layers of hotel management and allowing levels of middle management & front line employees more power in the decision making process: with decentralized management, some selected employees were encouraged to deal with situations using their own initiative and creative thinking with customer satisfaction within a preset amount of budget autonomy, still being held accountable for the bottom line at the end of the day.

 

3.    More assertive brand buzz & leverage of social media: if, as a US based traveler, I have acquired through other countries a distinctive awareness of some of the  top Indian hospitality brands such as Oberoi or Taj, I am stunned by the fact that these global brands don’t seem to be building , as other Luxury , lifestyle or Airline brands regularly do , much exposure & brand equity in European & US markets by conveying the special story of their fine quality & differentiation...and I am not talking about a 1 page featuring a property in a few international magazines, I am talking about a “wow” real media-to-event marketing program with partnerships that tell the tale of the magic & soul of India’s hospitality, there is much to be done either online or offline around that kind of material... Beyond the advertising storyboard, the fabulous profiles of historical properties or destinations could provide an incredible content to a more aggressive P.R. offensive through editorials. Even basic exposure would also make a difference through targeted online display on key travel websites such as Hotels.com, Expedia or Agoda at a time of booking, which I never got.Beyond communications, internet analytics can provide a wealth of customer intelligence that could feed into a refined /pro-active Customer segmentation & loyalty strategy to tailor messages & more personalized offers or packages as well as providing more readily accessible insight for hotel staff in terms of their guest’s preferences or interests (informing them about yoga class, food experiences or local excursions...). When it comes to leveraging the power of social media, I found that very few Indian hotel chains have their own Facebook page to communicate or engage with fans or those could become most active brand ambassadors... While more & more Internet savvy Indians book their hotels online  and India is the second market after the USA in terms of Facebook users with more than 62 millions, nothing seem to indicate that much of the attached analytics are being mined & gathered by marketing hoteliers to complete a customer’s DNA profile  and help design more targeted offers...When it comes to Twitter, many American hotel brands are utilizing the social media channel to reinforce their brand image and to communicate directly with their guests on a more intimate & timely basis. In the USA, Bill Marriott was one of the first CEOs to jump onto the Social Media bandwagon when he started his 'On the Move' blog in 2007...From Starwood to Hyatt or Ritz Carlton, many hotel brands maintain & promote their own Twitter pages to provide concierge services, updates on hotel properties or responses to specific questions from guests...

 

Last but not least, I found -maybe telling of the digital maturity of India’s hotel chains – that very few, even five star – of the hotels still don’t offer the basic courtesy of complimentary in-room first 30 mn for their guests to check their emails whereas it has long become, like cable TV or A.C., a commodity & necessity in the rest of the world for most business travelers...

In conclusion, with the current slowed growth that it is going through, maybe it’s time for India’s hospitality industry to rethink some of its strategic skills & upgrade its approach & tools when it comes to their Customer strategy, Service Excellence & delivery. It will be even more crucial to the growing trend of Internationally-branded, mid-scale offerings and value segment  which are more & more required by both domestic and international travelers...For that to happen, the best of traditional Maharajah style hospitality will have to incorporate an innovative 21st century strategy & its marketing tools that the population of Modern India & the digital age have already adopted.

If that happens, India’s hospitality industry might be in a position to become the most qualitative, competitive & efficient on the planet...!