Michaela: We need to begin by defining what is meant by ‘managing guests’. Firstly, it means being able to easily manage operational procedures at property and hotel chain level via PMS; and secondly, it means being able to easily sell value-added products and services to customers, e.g. by using CRM systems. If you can do both of these effectively, then you can say that you are successfully managing your guests.

CRM systems are undoubtedly important – they consolidate information about customer equity, such as their spending behavior, personal interests and loyalty schemes – but I would say that it’s not any one system that is the breakthrough technology, but rather the seamless integration of many systems into the existing technological infrastructure – this is the holy grail for the hotel industry. The challenge is that such seamless IT integration is not widely available and most systems work in isolation. Larger hotel chains have been able to develop their own integrated systems to plug the gap in the marketplace, but smaller hotel groups don’t have the resources to do this. The third parties in the supply chain really need to make sure that their systems provide the integration that the industry needs.

Tim: A true hotelier has a passion for taking care of their guests and this passion should extend across all customer touch-points. It’s time to realize that when customers interact with us across all these touch-points, they’re expecting to be remembered and recognized. The OpenTravel Alliance is setting standards for all customer contact and we’ve seen a recent surge in demand for integrated hotel technology systems – put the two together and it’s clear that people are beginning to understand that information needs to shared consistently across not just the hotel chain, but even between the hotel and airline industries.

When I started out in 1980, hotel information was kept in silos and this continued right up to about four or five years ago, when suppliers started to offer integrated solutions. It’s a big breakthrough and it’s been driven by demand – hotels want integrated technology because it helps them differentiate their guest services.

Michaela: Customers and their behavior have definitely changed. What does ‘valuable’ mean? It means loyalty, and loyal customers are now harder to find. Generation Y guests are internet-savvy consumers and they are used to the transparency the internet provides, especially when it comes to checking prices. Guests are less loyal than they would have been two years ago as the rise of price comparison sites has made it much easier to shop around. The selling process needs to be re-aligned to be more customer-orientated; taking into account the fact that customers now prioritize value for money above loyalty. This gives CRM an even bigger role to play in the hotel infrastructure.

Tim: The most valuable customers are the most loyal customers. Loyalty has always been important and hotels will go to a lot of effort to ‘wow’ loyal guests, because the payback is huge. In the recent economy it’s even more important to wow the right guests, as loyal customers can be relied upon to stick with trusted brands when they’re watching their spending habits. A loyal customer will always stay in their preferred hotels when they travel because they know they can trust their money with you. Hotels need to work hard to earn a guest’s trust if they want to get these results and they should focus on providing a totally predictable service. That’s the power of a strong brand – the power to create loyalty through excellent, consistent service.

Michaela: Guests are undeniably becoming more demanding than, let’s say, ten years ago, because the internet is now able to offer much more choice and transparency when it comes to booking a hotel stay. Hotels have always focused on looking after guests – after all, that’s their core business, but now they have to rise to the challenge of looking after demanding guests. For example, guests now expect a hotel’s website to recognize their profile when they make their reservation online, and they expect to be offered tailored packages based on their profile information. Even more importantly, customers also expect price transparency and best rate guarantees. All of this content has the power to convert a prospect into a guest, but it needs to be presented in the right way. If the display of rates is confusing or if the user can’t access their reward program account then they will soon become frustrated and try elsewhere.

Simple processes such as making an online reservation become time-consuming if the booking engine used by the hotel is not optimized to users’ requirements. That’s why h2c’s audit processes include a thorough content check when optimizing a hotels’ performance in the central reservation system. Different guests require different content information and the industry needs to figure out how to provide content via a single source to all connected distribution channels.

Tim: Customers have increasingly more sophisticated personal devices – iPods, smart phones, netbooks, etc – and this is what makes them more demanding. Guests will have invested a lot in their own home entertainment systems and will expect to get the same experience from their hotel as they’d get in their living room. When I was a kid, staying in a hotel was a novelty because the room had a TV with a greater choice of channels than I had at home – and that was the experience for me as a guest, being able to have something I couldn’t have at home. Now, if you went into your hotel room and found they had no flatscreen TV and no Wi-Fi connection, you’d be pretty disappointed. Consumer technology moves fast and it’s an expensive investment for hotels, but customers aren’t going to stop wanting the latest technology in their rooms.

Michaela: Our experience with clients is that social networking sites are being monitored but only a few pioneering hotel chains have implemented social networking strategies. There are plenty of online opportunities available, such as using Facebook to send targeted messages to potential customers, but not many hoteliers are aware of these opportunities or how to take advantage of them. Mobile technology is another valuable distribution channel, especially for targeting Asian customers, but again, hotels are only just beginning to realize its value.

There is a great deal of fear in the market surrounding social networking and review sites – a fear that these sites could negatively affect hotel businesses. H2c is working on addressing these fears and helping hotels turn social networking to their benefit. The industry really needs to be educated when it comes to using social media successfully. Northern Europe in particular has an internet-savvy economy with large online communities – a perfect communication channel for hotels targeting those countries.

Tim: Communicating with guests via social media is no different from using mass advertising or focus groups to communicate with your audience. Every business needs honest feedback from its customers if it wants to improve service, and the hotel industry in particular needs to encourage guests to tell us what they think. Social media is a perfect channel for conversation, not only because of the format, but because of the potential audience size using social media platforms: Facebook added a million customers in only nine months. Why advertise on TV when YouTube could reach a bigger audience?

There’s also the power of peer recommendation. If I’m sitting next to someone on a plane who recommends a certain tourist spot or hotel at my destination, I’m willing to check it out. People trust other people more than they trust an advert on the TV: 78% of people on social networking sites trust peer recommendations, only 14% trust adverts. The rise of mobile devices also means that your audience isn’t necessarily glued to a desktop – 80% of tweets on Twitter are sent via a mobile device so that audience includes people on their way to business meetings and walking round tourist hotspots. Generation Y will be the customers of the future and we need to interact with them on their terms.

I’ve seen a degree of phobia around social media – hoteliers worry about negative feedback, but the truth of the matter is that you’ll never be able to please every customer and there will always be negative comments about you online. Ignoring negative feedback is the biggest risk – if you ignore the online communities you’ll never be able to recover lost customers. Talking to people and asking them what went wrong and asking for a second chance to meet their expectations can turn a PR disaster into a success. Ultimately, we have to embrace social media because it’s not going to go away.

Michaela: Delivering the best guest experience means tracking the customers’ perceptions on a regular basis. Everything moves so fast now that feedback from customers needs to be gathered for every day of their stay – it should be an integral part of their experience. This information can then be fed into the hotel’s integrated systems and used by reservation agents the next time the guest makes a booking.

Another way to improve a guest’s experience is the enhancement of hotel websites and booking process optimization. Most booking engines are not really user-friendly – an assertion confirmed by the very low conversion rates of our industry. The hotel industry converts an average of just 0.5 – 3% of website visitors into actual reservations in Europe. This is because the websites are typically not optimized to trigger immediate action (e.g. a booking); they take too long to load, don’t have pictures of hotel facilities available, and are missing vital information such as a clear presentation of rates. Hotels need to improve their websites and make sure they customize the online experience as much as possible – which relates back to my initial point about the seamless integration of IT systems, which is the key to making all this happen.

Tim: I would pick a technology that was highly integrated and highly personalized around the customer. Hotels need to make sure that they’re easy to buy from: we should offer self-service, we should offer advance check-in, and we shouldn’t make it harder to book by phone than online. Customers like to do business in different ways, and the industry needs to stop trying to dictate to the customer during the process. We need to be more accommodating – customer experiences should be personalized to fit different demographics.

On the control side, and speaking now as a guest wanting a better service, I’d like to see a hotel that offered me the chance to control which room I stay in. I don’t want to be randomly assigned a room, I want to select a room with the view I want. To do this the industry needs integrated technology that makes the booking process a consistent experience across all channels – phone, website, etc. The message really is, don’t force customers to carry out their transactions in the way that’s easiest for you. It’s not about you – it’s about them.