Recapping the Effect of Online Reputation on Revenue

Last week, Revinate and eCornell co-hosted a webinar that outlined five ways hotels can improve their online reputation. By measuring their reputation management efforts, involving the entire operations team, and tying compensation rewards to reputation achievements, hoteliers will see improvements in their overall guest satisfaction scores and, in turn, will receive higher review ratings. In case you missed this informative session, you can listen to the recording and view the presentation deck.

As our Cornell University co-host published in a recent study, proactive online reputation has a direct impact on your hotel’s revenue; their Center for Hospitality Research (CHR) report shows that a one-point increase in a hotel’s average user rating on a 5-point scale makes potential customers 13.5% more likely to book that hotel. Moreover, hotels with great online reviews can charge more than those that do not rate as high. Finally, hotels that use social media for service and engage in the space to surprise and delight customers earn more positive guest sentiment scores, which positively effects hotel revenue .

As mentioned during the webinar, eCornell has, in partnership with Cornell’s School of Hotel Administration, developed 14 professional certificates and 38 courses in hospitality management. Among them is the new Hospitality Marketing & New Media Strategies for Revenue Growth. This course in new media marketing, called Marketing the Hospitality Brand through New Media: Social, Mobile & Search, is free and open to all.

Revinate received a number of questions that came in during the session via live Twitter chat that are answered in greater depth here:

How again can property management be awarded bonuses or compensation benefits for better online reputation?

By paying close attention to Revinate‘s guest satisfaction (Gs2) reports, hotels can leverage aggregated hotel review data to set goals for hotel staff to meet across all functional areas. Overall guest sentiment scores, for example, can make a valuable incentive for hotel general managers. Department heads could be awarded bonuses based upon departmental sentiment, while front desk managers could be given goals around response time or social media management. To learn how social media will change hospitality compensation plans, have a look at our blog post on the topic.

What are some ways that hotels can involve their entire hotel team when it comes to online reputation management?

A few ideas that we covered during the webinar included having your front desk employees engage with guests on social media to maintain responsiveness or offering spot bonuses to employees who are recognized by name in online reviews. To ensure that all employees see this feedback, one of our webinar attendees shared that her hotel posts all positive reviews in employee elevators, locker rooms and cafeteria. Ideas like these will guarantee staff involvement and engagement.

Is there any data available that is focused on the limited service or economy hotel sectors? A lot of the studies discussing the relationship between online reputation management and property performance seem to focus on the luxury segment.

While the Cornell Center for Hospitality Research study showed a direct relationship between revenue per available room and online reputation scores, the report did not include the economy segment. Nevertheless, the study showed that revenue grew by chain scale from the top down: A 1% boost in reputation led to a .49% increase in RevPAR at luxury hotels, .74% at upper upscale, .83% at upscale, 1.13% at upper midscale and 1.42% at midscale. Moreover, about 20% of Revinate’s 15,000+ customer base fall into this limited service segment and firmly believe that online reputation is equally, if not more important, in the category.

re-posted via the Revinate blog.