The legacy syndrome and hoteliers' ability to unlock new revenue streams from personalization


Amid the travel industry's retail transformation that aims to strike the sweet spot between profit and customer-centric experiences, hoteliers are experimenting with different unbundling and re-bundling strategies and techniques. In the quest to fulfil as many guest needs as possible and increase share of wallet, hoteliers are also partnering with third parties to expand the products and services they can offer. But packaging insourced and outsourced offer components while delivering a seamless and personalized, yet consistent, brand experience across customer touchpoints is challenging.

"Service excellence" is the cornerstone to acquiring and retaining customers. Getting the edge on the competition through service excellence requires people, organizational designs, operational processes, and technology to all come together in lockstep. And this is where the industry's legacy syndrome often gets in the way of enabling personalized and profitable customer experiences.

A wedding anniversary between heaven and earth

My wife and I recently purchased a packaged holiday to celebrate our wedding anniversary, which included flights and our stay at a 4-star resort in Cancun. The package also included bundled activity add-ons at the resort with the option to include further unbundled ancillaries. While our experience with the airline was excellent that changed once we got to the resort. Let's break it down.

 1. Unbundled off-property add-ons - ground transportation

One of the unbundled ancillaries the resort offered was transportation from the airport to the property. As I was shopping around, I found that the service came at a 20% premium compared to competing services. However, as I tried to book an alternative service, I was shocked at how unresponsive, and at best slow, chatbots, phone calls, and emails were to making any sort of progress. In many cases, I received no response and in most cases I had to repeat the same basic form information several times with the same provider. I soon came to realize that the 20% premium the resort was charging would let me overcome these challenges and happily paid the extra money. The whole process was fast and simple. Upon arrival, a well-groomed driver picked us up and took us away in a luxury car, with an array of cold beverages. The driver spoke clear English and engaged in entertaining conversation. While the shuttle service was delivered by a third party, it embodied the luxury resort's brand and was completely in line with our service expectations.

 2.Bundled and unbundled on-property add-ons

Our arrival at the resort exuded customer service excellence. From concierge greeting right through to our room, everyone seemed to know we were celebrating our anniversary. Upon entering our room, we instantly found products we had pre-purchased waiting for us. Cherry on top, there were also a variety of complimentary products in recognition of our special occasion, including a special beach-side table reservation at one of the resort´s restaurants. It seemed that things couldn´t get much better. And they didn´t

While the resort's central reservation system recognized our special occasion, the rest of the property's siloed systems did not. While our beachside table was amazing, neither the maître nor the waiters acknowledged our anniversary. In fact, it wasn't until the day after when it came up during a brief conversation that things personalized. And yes, a musician treated us to a dedicated song at our table and the complimentary dessert was great, but it came a day too late. The "WOW" factor had simply gone. Who knows how things would have turned out with a little more systems integration and communication between staff.

 3.Off-property activity add-ons

A few days into our trip, we visited the concierge office to search for "things to do" on- and off- property. What we hoped would be a relatively quick and smooth process ended up taking close to two hours, most of which consisted of listening to the concierge make a myriad of unsuccessful phone calls. Once we settled for an activity that was actually available, an invoice had to be raised and paid separately. And once we actually got to the venue, the service provider was unclear what we had purchased and if we had paid. Him not speaking English nor us Spanish didn't help and the whole process was frustrating. Despite narrowly making it back on time to the resort to catch the last dinner service, it was clear that the activity facilitated by the resort did not live up to the expected 4-star standard. And the irony is that over dinner one of the guests sitting close to us mentioned that her group had enjoyed a series of on-site activities that we would have chosen in a heartbeat over what we actually ended up doing off-property. If only the resort had had a simple form at booking requesting our likes and dislikes and a system that could connect the dots, they could have proactively offered us relevant activities, saving us a whole lot of time and frustration.

Moral of the story

While unbundling and re-bundling enable personalized guest experiences and increased revenues in hospitality, having the right systems in place that can connect the right data points is critical to enabling new retailing practices. Doing this within a hotelier´s own ecosystem is challenging enough given the legacy syndrome. But seamlessly integrating partners and establishing congruous service levels with a property's brand proposition is equally important to delivering a consistent customer experience across touchpoints. Delivering "service excellence" involves cutting through the people, organizational, and operational verticals. A modern technology platform is the glue to bringing a new retail era to life for hoteliers and unlocking new revenue streams from personalized guest experiences by connecting customer data with dynamically packaged offers and selling them consistently across channels.

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