The Revinate Blog

The Facebook Factor Part One: What Fandom Means to Hotels & Restaurants

Stock valuation concerns notwithstanding, it is generally agreed that Facebook will reach 1 Billion users in 2012.  There is simply no denying the company’s star power in the social media landscape.  After spending time to adopt the new timeline format, hotels and restaurants are looking to Facebook to drive business, brand equity, and word-of-mouth marketing.  In this two part article I will talk about what Forrester research calls “The Facebook Factor” and discuss how the world’s most ubiquitous social media site can deliver for the hospitality industry.

Forrester Research reccently released a report called The Facebook Factor (April, 2012), where compelling numbers show the impact of Facebook fandom on brand interactions and sales.  While this report focuses only on four companies; Best Buy, Walmart, Research in Motion, and Coca-Cola, there is widespread applicability to the hospitality industry. 

The reason to have a customer become your fan is logical because they see your posts on their timeline without having to visit your Facebook page.  However, this report drills deeper into three specific benefits of fandom and quantifies the responses of fans vs. non-fans.  When surveying Facebook fans, the report shows dramatically higher purchases made, consideration of the product, and the likelihood to recommend products to others, as you can seee below.

 

Fandom’s influence on purchase

Hospitality businesses that benefit from heavy repeat business are in the best position to take advantage of a Facebook fan’s likelihood to purchase.  According to Forrester, 79% of Best Buy fans purchased within the past 12 months of the survey.  Non-fans who were surveyed only purchased at a rate of 41%.  Being a fan of your business nearly doubles the chances that a customer will book.  This proves that targeted promotions can drive business quickly. The real-time delivery of marketing messages via Facebook can drive value in your fan relationships and business when you need it most.  Hotels will want to consider their average booking windows and the location of many of their fans, before launching promotions.  Restaurants may have more flexibility to drive business during slow-demand periods using Facebook promotions.  For any business, however, it is important to consider your engagement-to-marketing balance with fans.  If you bombard customers with offers and never engage them with information or entertainment, you may begin to lose fans. 

Fandom’s influence on consideration

Interacting with Facebook fans mean that your business will stay in your customers’ sphere of consideration both for repeat business and recommendations.  Reminder advertising seeks to keep a product in the mind of the consumer once it is already familiar.  This can be done in a highly targeted and inexpensive way through Facebook and other social media channels.  Updates, anecdotes, and interactions from a hotel or restaurant will keep fans thinking about your business and remembering their experience with you.  When they have another need for your restaurant or hotel, they will be more likely to come directly to you, and less likely to consider competitors. 

For hotels, there is an additional advantage to this type of loyalty.  Customers are less likely to book via an online travel agency when they have a relationship directly with you.  This reduces booking costs and the chance that a competing property could lure your customer away.  When the average booking through an OTA costs a hotel between $40 and $120 and a direct booking cost between $2 and $6, the savings from having a customer directly loyal to you are clear.  Facebook fan bookings can be more profitable than other customer segments and you can offer direct book promotions to maximize this advantage.

Facebook Fandom and recommendations

While all three brand interactions surveyed by Forrester are important to hospitality, recommendations tend to be the most useful to our industry.  A report by HMSAI reports that WOM (word-of-mouth) is the top factor in a business traveler’s decisions about hotels and restaurants.  In that report 67% stated that they get guidance from co-workers who have visited the area and 60% say they consult business contacts in the area when planning travel.

Even when hotels or restaurants are unlikely to see a customer again within a short period of time, recommendations can be a powerful marketing force.  Our industry now survives or thrives on word-of-mouth marketing and Facebook fans can become your best salespeople.

According to Forrester’s survey of over 10,000 US adults, 62 to 83% of fans were likely to recommend the brands tracked.  For example, 74% of Facebook fans of Best Buy were likely to recommend the retailer vs. 38% of non-fans.  This evidence about the level of recommendations by fans is very enlightening and shows without question the value of social media engagement.  Savvy hotels and restaurants can experience a snowball effect, where continued interaction with Facebook fans drives new business from recommendations, which then builds more fans. 

Earning Fans and keeping Fans

The most effective way to earn a Facebook Fan is to provide a great stay and/or meal.  Forrester warns against advertising solely to get fans on Facebook rather than appealing to current customers to become fans. It is important to realize that a company’s Facebook fans “have an affinity to the brand, not necessarily as a result of being a Facebook fan.”   The best fan base is created by customers who have experienced your hospitality.  They will be more engaged, more invested, and more likely to repurchase, consider, or recommend your hotel or restaurant.  Fans that follow you because you put forward a special offer to become a fan are more likely to end their fandom as soon as they have redeemed the offer.  The most valuable fans are grown naturally through great service combined with social media integration. 

Once you have gained a fan, the fundamentals of good social media interaction apply.  Provide value to your fans through information, entertainment and engagement.  Allow your fans the ability to upload photos and stories about their time at your hotel or restaurant.  This not only helps your fans feel connected to each other, but humanizes your business.  Customer relationships that grow through fan interactions are very persuasive to other potential customers.  Consider treating your fans like members of an elite club, not necessarily with perks, but with attention, engagement, and sharing.

When you gain a Facebook fan the cost benefits, relationship benefits, and word-of-mouth benefits are clear.  Repeat customers are cheaper attract, cheaper to maintain, and more likely to foster more business.  Social media sites like Facebook provide an unparalleled avenue to engage with those customers and keep them loyal.  The Facebook Factor is alive and well for the hospitality industry and hotels and restaurants should continue to take notice. 

The next step: Brand Advocacy

Turning a Facebook fan into a brand advocate will deepen the benefits of high customer involvement.  In part two of this article we will look at brand advocacy for hotels and restaurants.  Stay tuned to learn how to turn ordinary fans into brand champions who will promote and market your business in surprising ways and provide excellent insight into how to attract new customers. 

Why Customer Service and Social are Linked

American Express recently published the American Express Global Customer Service Barometer and the results show why it is so important to provide great customer service on social platforms. While the report isn't tailored to the hospitality industry, it's a great source of data for hotels and restaurants wondering whether to devote resources to social media.

For one, the report says, "consumers who have used social media for service tell significantly more people about their service experiences, and say that they'd spend 21% more on companies who deliver great service - compared to 13% on average." In other words, if you can wow your socially savvy guests doing what you do best - providing great service - they will tell others.  How can you identify your socially active guests? Monitor foursquare, Twitter and Facebook for any check-ins or mentions of your hotel. Revinate users can easily monitor these mentions in real-time using the Revinate dashboard, and even click through to the person's Twitter or Facebook page, if public, to learn more about him/her. As soon as you catch a mention or check-in, respond to the guest to show that you're listening and responsive to feedback or service issues over social media.

We have amassed great stories from hotel clients that have quickly resolved service issues over Twitter and turned an annoyed customer into a loyal guest that tells others about the high level of service he/she experienced at the hotel. Hyatt Regency Chicago, for example, monitors conference hash tags in the hotel for any facilities issues and responds immediately, wowing the conference attendees and followers with swift action. And it's not just complaints that you want to monitor. Four Seasons comes to mind as a hotel client that has had incredible (public) results sending amenities up to guests' rooms as an extra show of gratitude and service when they receive a check-in or tweet.

In addition, the American Express report shows that "consumers who have used social media for service in the last year are willing to pay a 21% premium at companies that provide great service." So rather than thinking about the expense of monitoring social media for service issues, you can think of it as an investment in your sales programs as happy, socially engaged customers are willing to spend more with you.

Read the whole report here.

 

Revinate and Clarabridge Partner to Bring World-Class Customer Feedback Analysis to Hospitality Industry

Today, Revinate announced a partnership with Clarabridge, Inc, the global leader in text and sentiment analytics driving Customer Experience Management (CEM). Together, Clarabridge and Revinate offer an integrated solution to provide hospitality professionals with customer insight from social media activity, critical to marketing, operations and resource allocation.

Online customer reviews and social media feedback, categorized as unstructured data, traditionally come from disparate sources and are difficult to comprehensively aggregate and analyze. Revinate’s sentiment analysis solution, powered by Clarabridge, arms the hospitality industry with an intuitive, enterprise-grade solution that automatically monitors and analyzes unstructured content. Delivered in real time, critical voice of the customer data bolsters service recovery, training, and operational improvements.

“The growing importance of online reviews in consumer purchase decisions makes it more critical than ever for hotels and restaurants to pay close attention to issues raised by guests,” said Jay Ashton, Co-Founder and CEO of Revinate. “The hospitality industry has always been dedicated to providing a great guest experience; learning from, and acting upon, guest feedback is crucial to boosting sales and loyalty. With Clarabridge, Revinate can easily sift through the social media chatter and transform sentiment into actionable strategies.  This partnership strengthens Revinate’s ability to help hospitality companies to monitor, manage and improve their businesses through intelligent analysis of customer data.”

While Clarabridge has been working with many of the world’s largest hospitality brands for years, the partnership with Revinate means that even more regional, property and brand-level teams will have access to Clarabridge’s powerful sentiment technology. David C. Kloeppel, President and Chief Operating Officer at Gaylord Entertainment, says, “It’s exciting to see the partnership between Clarabridge and Revinate. As a long-standing customer of both companies, we recognize the power that the combined solution will give our STAR employees and we believe that loyalty will increase as we better understand our guests’ needs and provide a more tailored experience.”

“Revinate has proven itself to be the leader in hospitality reputation management, through listening and proactively engaging the Voice of Customer (VoC) as a critical initiative,” said Sid Banerjee, CEO of Clarabridge. “Members working on the front lines have exclusive access to customers on a daily basis and prove an invaluable resource to improve operations. We look forward to the synergies this partnership will provide for our hospitality customers and all organizations seeking to improve their reputational and operational posture.”

About Revinate

With user generated content and reviews increasing in both number and importance, hotel and restaurant owners and operators have a simple choice: either ignore the cacophony of social media and hope for the best or proactively track and manage what is being said online in a way that deepens customer relationships, strengthens brands and boosts revenue. If you opt for the latter, then Revinate’s user-friendly software platform, custom-designed for the unique needs of the hospitality industry, is an irreplaceable tool. Revinate’s powerful technology monitors all of the important social media venues – including Twitter, Facebook and TripAdvisor – and provides instant alerts whenever your property or brand is mentioned. With information comes power: in this case, the power to please a disgruntled customer, monitor the competition and set yourself apart when it comes to guest satisfaction and loyalty. Based in San Francisco, Revinate counts the world’s leading hospitality brands as clients. To learn more, please visit www.revinate.com

About Clarabridge

Clarabridge is the leading provider of sentiment and text analytics software for customer experience management. Clarabridge enables Global 1000 enterprises to achieve a universal understanding of their customers by automatically collecting, classifying, scoring sentiment and analyzing qualitative data found in voice of the customer feedback channels. Insights extracted result in improved marketing, product/service offerings, operations and customer service across an organization. Clarabridge customers include AOL, B/E Aerospace, Betfair, Charming Shoppes, Inc., Choice Hotels, Dell, E.ON, Expedia, Fidelity Gaylord Hotels, Intuit, J.D. Power, L’Oréal, Marriott International, Nissan, PetSmart, QVC, Inc., Sage North America, Santander, United Airlines, Unilever, Walmart, Walgreens and Wendy’s International. Clarabridge is privately held with offices in Reston, Va. and London, U.K. For more information, visit www.clarabridge.com or on Twitter: @clarabridge.

 

Kempinski Hotels Selects Revinate as Social Media Solution

San Francisco, CA – February 14, 2012—Revinate, the new standard for guest satisfaction for the hospitality industry, today announced that Kempinski Hotels S.A. has partnered with Revinate across its portfolio of 71 luxury hotels in the Middle East, Africa, Asia and Europe.  The global rollout of Revinate is happening in-line with Kempinski’s new social media strategy to ensure that success can be tracked and measured.

Kempinski property and corporate staff will be using the software platform to both manage the properties’ online reviews and drive new business and loyalty with Revinate’s social media solution. In addition, General Managers and the Corporate Operations Department will be using Revinate’ GS2 Reports as part of their management reporting, ensuring that social media and online reviews will become operationalized, much like traditional guest satisfaction.

Kempinski selected Revinate after an in-depth, multi-vendor evaluation process. Revinate won the business based on its comprehensive, multi-language review coverage and its rich feature set. Alexander Noak, Corporate Manager Digital Strategy at Kempinksi Hotels S.A. explains, “I was looking for a way to differentiate ourselves from our competitors and we can do that through our reviews. Of all the tools we looked at, only Revinate provides a solution that allows us to use our online reviews to influence conversion. Revinate’s Social Buzz makes it quick and easy to select and post quotes from reviews on our own sites to ensure that our shoppers have trusted guest feedback to give them confidence in their booking decisions with us.”

Kempinski Hotels S.A. is an exciting new partnership for Revinate, who is already viewed as the gold standard in online reputation management for hospitality in North America. Marc Heyneker, Co-Founder and VP of Sales says, “With our recent addition of comprehensive global review coverage in all languages, Revinate is now actively expanding its services to address the needs of international customers. Having a large, well-established luxury brand like Kempinski select Revinate is a great testament to our solution’s strength and value overseas, and helps pave the way for our future growth across global markets.”

About Revinate:

With online guest-generated travel reviews increasing in both number and importance, hotel owners and operators have a simple choice: either ignore the explosion of social media and hope for the best or proactively track and manage what is being said online in a way that deepens customer relationships, strengthens brands and boosts revenue. If you opt for the latter, then Revinate’s user-friendly software platform, custom-designed for the unique needs of the hospitality industry, is an irreplaceable tool. Revinate’s powerful technology monitors all of the important social media venues – including Twitter, Facebook and TripAdvisor – and provides instant alerts whenever your property or brand is mentioned. With information comes power: in this case, the power to please a disgruntled customer, monitor the competition and set yourself apart when it comes to guest satisfaction and loyalty. Based in San Francisco, Revinate counts the world’s leading hospitality brands as clients. To learn more, please visit www.revinate.com.

How 'Real' is Online Reputation Management

Just how real is online reputation management? According to a press release issued by Willis in October, hotels can now get insurance to guard against the effects that bad PR can have on their bookings. The release reads, "To help protect hoteliers from losses as a result of such adverse publicity, Willis Group Holdings the global insurance broker, in conjunction with Lloyd's of London underwriter Kiln, has created a policy aimed at limiting the financial fallout from negative PR."

The release goes on to say, "Laurie Fraser, Global Markets Leisure Practice Leader for Willis said: "In the extremely competitive hotel industry, reputation accounts for approximately 30-40 percent of a business's overall worth. Therefore, damage to reputation, which spreads virally through social and other media channels, can have a significant financial impact. Our product is designed to tackle both the actual loss of revenue and the costs of containment."

Of course the best way to prevent a PR disaster is to monitor your online reputation so you're aware of murmurs before they become screams. Using Revinate, a hotel can see every tweet, tagged photo or video, public Facebook post or blog entry about your property in real time. These notifications become your best defense against a potentially harmful story that has the power to be retweeted and shared. Adress the issue immediately with the guest and you can circumvent the need for disaster recovery later.

The Broader Value of Social Media

Revinate has many people across the world that genuinely believe in our product and want to see the platform become a standard at their property, brand or management company. But, when these people aren’t the decision makers in the purchasing process, we need ammunition, especially when social media is run by someone who doesn’t fully understand its potential and thinks of things in terms of hard ROI.

So, when Bain & Company published a report called, “Putting social media to work,” and included a call-out box, titled “Making the business case for social media,” my attention was piqued. Here is what one of the best consulting firms has to say about social media:

Many companies struggle to calculate an ROI on their investment in social media. And without confidence in clear returns, have difficulty securing the funds needed to scale their efforts. Companies that most successfully make the business case for social media use a two-pronged approach.

First, they set clear business objectives for using social media at each step across the customer corridor. They run small, contained pilots, carefully tracking returns to demonstrate whether further investment is warranted. For example, if the objective is to generate leads, the same metrics and measures used to assess the effectiveness of other marketing vehicles can be deployed to gauge the success of a social media pilot campaign. If the objective is to boost customer service, the effectiveness can be measured by service resolutions, relative cost and productivity, call avoidance and the ratios of detractors converted to promoters.

Second, companies further build the case by considering the broader value of social media. They articulate the value of engaging their customers where they are increasingly spending time and consider the real business value that authentic engagement can create. Again, customers who engage with companies over social media are more loyal and they spend 20 percent to 40 percent more with those companies than other customers do. Social media platforms are becoming increasingly important for companies to engage with, delight and retain their best customers.

I spend a lot of time on Facebook, Twitter, review sites and location-based services seeing how hotels engage with guest and prospects. I am always pleased when I see a connection being made, whether it’s a tweet welcoming a guest who has virtually checked in, a response to a service request or just a Facebook post about what to do in the local area. Why? Consumers really value these interactions because it shows that there are brands out there that care about more than a transaction and are willing to take the time to get to know their customers.

And, of course, there are real benefits for hoteliers of engaging with guests on social media. Engaged customers not only spend more, but they share experiences with their networks. So if you surprise and delight a loyal guest, he is likely to share that experience with others. And everyone knows how powerful a referral is in the hospitality business. According to Market Metrix, referrals and recommendations drive more bookings than either location or price.

If you adjust your mindset and think about the ‘broader value of social media’ as Bain & Company suggests, what ideas do you have for engaging with guests?  Is there a loyalty reward you can offer a guest that checks in using foursquare, or some tips you can offer a twitter user who tweeted that he’s looking for restaurant suggestions in your area? Jump in. Engage. See where it goes.

Cornell Study Details Pre-Booking Research

A new Cornell University study provides some interesting stats about how much research goes into booking a hotel room. The study finds that "some travelers spend enormous time researching hotels online. On average, hotel consumers made twelve visits to an OTA's website, requested 7.5 pages per visit, and spent almost five minutes on each page before booking."

What are they reading? Reviews. Make sure that you're providing fresh content by encouraging reviews and responding publicly to reviews that might negatively impact your reputation.

The study also discusses the benefits of being listed on third-party websites operated by online travel agents.  The study shows that "a hotel's listing on Expedia increased total reservation volume—not including reservations processed through Expedia itself." Calling the phenomenon the 'billboard effect', he suggests using marketing budget to pay commissions on OTAs since it's driving bookings on the hotels' own Web sites.

Read the whole study here.

Proof that no one reads anymore

The truth is that we're all scanners. We skim a Web page to figure out what a company does rather than read the details. We agree to terms of service without reading the terms. We sign contracts without reading the fine print. I say this to make myself feel better for missing the Revinate mention in my favorite new book, The Thank You Economy, by Gary Vaynerchuk.

Yes, I did blog about the book here and here. I even made a joke about him working for Revinate. I also tweeted out thoughts as I read, applauding when I got to the chapter about our client, Joie de Vivre Hotels. Had I read that chapter just a *little* more closely, I would have seen this on page 172:

"To help keep tabs on how well its social media efforts are working, the company relies upon daily updates and a scorecard system from Revinate, which monitors and manages online reviews and social media sites exclusively for hotels. It also pays close attention to TripAdvisor consumer reviews and ratings. It should come as no surprise that as of the first quarter 2010, two-thirds of the Joie de Vivre hotels were listed in TripAdvisor's top ten for their geographical area."

File this in 'egg on my face.' but also HUGE!!

Google Places with Hotpot

Last month Google rolled out Hotpot, a new review and recommendation service that brings together user generated content and social features. Whereas other review sites simply allow users to post and read reviews, Hotpot learns what you like based on your personal tastes and preferences and helps you discover other places you might like. Tightly integrated with Google Maps, Hotpot will recommend new places to try once you have rated places and added friends.

 

Google Hotpot is almost game-like. It starts by showing you businesses by category that you go through and rate so it can begin to understand what you like. You give the business an overall star-rating and can then provide a 'tip' and more sub-ratings. When searching for a new business, you can go to Google Maps to see what your friends have to say. According to Google, "Your Google Maps search results will be prioritized according to your preferences. Then you’ll see explanations from friends, so you can find the right place for you."

 

I have been fascinated with the time and effort people take to write hotel reviews as it's in sharp contrast to the way many social networks are training us to think.  For example, we are updating our facebook status with one or two sentences and tweeting in 140 charaters and less. If this service takes off and steals traffic from review sites and OTAs, I expect hoteliers will miss the depth of data they get from online reviews today. But only time will tell.

 

Hotel Me by Kukunu

I just added the Hotel Me (beta) application on Facebook and asked my friends where I should stay next week when I go to Miami. As I was doing it, I couldn't help but wonder why I was using an app to do something that I could just as easily do directly on Facebook and Twitter. Granted, the point of the application is to help me book the travel after I have received suggestions, but I'm not sure I would book that way. I would likely take the suggestions and then double check reviews on TripAdvisor and then check Orbitz or Kayak to make sure I can get the best deal.

It's a good thing I didn't rely on the results. One friend simply commented on the post, rather than pressing the 'Click here to suggest' button. Her comment was, "There's the one they keep featuring in Burn Notice." The other did press the button but didn't want to share her personal information so instead she left me this comment, "I wrote out a whole recommendation and pressed "post", but the app wouldn't allow it cuz I didn't want to give them permission to access my friends list and my personal info. Too bad for them."

Looks like Hotel Me is an app I won't be using any time soon. Is anyone else using it and having better results?