Being a part of the industry, hotel reviews are something I always take with a pinch of salt. Especially those on the extreme ends! However, internet is a place for opinions and if many more people join in the chorus to say negatively about a property, then I would rather give it a miss instead of taking a chance. But does that really make it a bad hotel?
Truth be told, if most people are unhappy with the property, then there must be something wrong with it. Guests are expressing their dissatisfaction as they have had bad experiences. And hotels need to take them seriously. As the first rule of the service industry says customer is the king, and in this age of hyper-internet activity, they rule.
As simple as coffee makers
One of my friends, an ex-revenue manager had a unique experience in a hotel she had worked in. A decision was made to pull out coffee makers from rooms. Management thought it would be cost effective in the long run to cut down the additional task of replacing and stocking this one guest amenity and instead focus on other areas for improvement. There was a café in the lobby and so during the time of check-ins, guests were given a voucher to use at the café. You would think the problem was solved. Well, not quite!
Guests began to leave negative reviews not only on travel sites, but also through the hotel’s internal guest feedback form. It seemed that one amenity affected their entire stay and made them question the worth of the room. To appease guests, rate adjustments had to be made; additionally they were provided complimentary coffee from the café. The hotel’s ranking on TripAdvisor went down sharply because its competitors continued to supply coffee-makers in their rooms and guests felt they were getting more value for their money with the competitor. Another decision was made by the executive team. And coffee makers were back in place. And it worked!
Unknowingly (or maybe not) guests have placed themselves at the decision-making table of the hotel.
Stitching it together
 As revenue management evolves, it is getting away from simple rate management and is now incorporating customer relations and social media into its strategy. The more satisfied guests you have, the more likely the guest is to return and spend more money, as well as recommend you to others. Reputation has a positive correlation with the hotel’s overall Average Daily Rate (ADR) and revenue. It’s time now for the revenue management department to work hand in hand with the marketing team, if they are not already doing that.
A recent survey by Laterooms.com suggests that 90% of travelers would avoid booking hotels labelled as “dirty” in online review sites. Sure, the situation might not be as bad as the guest made it seem, but the hotel cannot prevent the reviewer from expressing his/her opinion. However the beauty of online reputation sites is that most will give the property an option to respond. And it needs to do just that - Respond! More so for negative reviews!
For a hotelier, facing challenges like these can be a nightmare, especially when it hits you out of the blue. Hence, it is essential to take an analytical approach to understand your strengths and weaknesses as per your guests and take a cohesive approach to address these issues. However guests share feedback on various review and travel sites – all this valuable information lay scattered and unstructured. It is here online reputation management tools play a big role in consolidating these guest reviews and presenting them to hotels in structured report formats. Usually, these tools pull guest feedback from various review websites including Qype, Holidaycheck, Yelp, Expedia, Facebook, Twitter etc.
 Data is then compiled together into review reports which include guest details (as it appears on the site) along with their feedback and the rating they provide to the hotel. Hotel reputation management tools like RateTiger Review, uses sentiment analysis to understand the guest’s emotion towards various aspects of the property. Keywords relevant to the properties are then identified and ranked based on their popularity, frequency of mentions and guests’ sentiments towards that category.
 In other words, semantic analysis gives out a snapshot of what’s right and what’s wrong with the property. For the hotel, it serves as a measurement of guests’ perception against intended brand positioning. For the marketing team this analysis provides a key insight into guests’ preference, which will help them customize their promotions to have a direct resonance with customer sentiment. From the operational perspective, you now know the areas you need to address the most. For instance, if a hotel continuously keeps getting comments that their rooms are outdated and uncomfortable; this is an indication to the management to invest in renovation to ensure guest satisfaction, as well as attract new guests. Guest review analysis works hand in hand with rate, occupancy, RevPAR and channel performance to provide hotels with the overall picture, and efficiently use Price Quality metrics to make strategic rate decisions.
Managing your feedback
According to recent studies, one third of consumers will not book a hotel room without first reading reviews first (Laterooms Survey, Nov 2012). Reviews with a rating on 4 - 5 generate more than double the conversion compared to a review with 1.0 – 2.9 rating on Expedia. Hotels that have a higher guest score typically will have better placement on the travel sites. A better placement on the travel site means more bookings. More bookings mean a higher room rate, and eventually higher revenue for the hotel.
Take the example of Slovenia based LifeClass Hotels & Spa, which has experienced a surge in repeat business by developing a post-stay, guest engagement through online guest review websites using RateTiger Review. Each property assesses the information and responds to guest reviews from social channels like Facebook, Yelp, etc along with those associated with sales channels (like Booking and Expedia) multiple times a day. “We have been actively monitoring guest reviews of our properties as well as those of our competitors. RateTiger Review has helped us to respond pro-actively to negative reviews, and address our product offerings,” observed Alen Milosevic. This has resulted in 30% revenue growth in 2012.
What’s more, an improved ranking has a positive correlation with direct booking. For 4C Hotels in London, proactive guest engagement has resulted in a 5% increase in direct booking. “Whenever we see a negative posting, we action a proper investigation to find out what went wrong. We don’t make the same mistakes as before, we are able to identify them and address them,” says Asad Zaheruddin, General Manager at 4C Hotels.
A strong visible position on guest review websites indicate that your Price Quality Index is working well, that will enable you to make the right pricing decisions based on RevPAR performance. This will allow the hotel to flex their rates based on a number of pricing strategies depending on booking levels. However, there are no short cuts. It is an evolving process that has to start today! As we move towards the age of consumer controlled brand conversations, hotels need to integrate customer feedback into their business approach and strategy planning.
Revenue management was always a game of chess and now even more pieces are being added to the board. By staying actively engaged with guests, hotels can ensure a more consistent and loyal base. Are you listening?
- By Udai Singh Solanki, CTO & Managing Director, eRevMax Technologies
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