Everyone’s in the Hospitality Business, Every Day

In today’s competitive market, the customer experience is everything — and not just in the hospitality industry. From the very first impression until the customer walks out the door, there are countless opportunities for making their experience memorable.  As part of eCornell’s Keynote webcast series, customer service expert Elizabeth Martyn from Cornell Hotel School joined eCornell’s Chris Wofford for an interactive discussion on understanding the customer mindset, how to exceed expectations — and even when offering guests a warm cookie might backfire.

What follows is an abridged version of that conversation. Watch the full keynote here.

Martyn: I feel like I always have to tell people that I’ve never actually worked in a hotel, which throws people off a little bit when we start talking about hospitality. But I take a broader view and believe that hospitality is really everywhere. If you have clients, or customers, or patients, or anyone who buys anything from you, you’re really in the business of providing a service and therefore you’re in the business of hospitality.

Wofford: The two of us were talking a little bit about the modern tech-savvy consumer and their expectations.

Martyn: I think whenever I start to talk about these things, I ask people to think about themselves. Because I know I’m one of these people. I’ve got my phone attached, I’ve got my computer ready. And whether you’ve thought about it or not, we’re all becoming really highly trained by our devices and by technology to have information at our fingertips. You expect that you’re going to be able to get everything done on your phone. Now, not everyone prefers to do it on their phone, don’t get me wrong. Some people are more traditional. They want that phone call or they want to do it on their computer.

But that’s where we’re moving to, because we’ve been trained that we’re always going to get exactly what we want, and there’s so much on our phones that we can use to make it exactly how we want it. But it’s not like we’re all issued the same phone with the same apps or the same email provider. Everybody can pick and choose what’s going to work for them and to create a digital experience that reflects who they are as a person. But now that we’re so used to having this thing that’s like attached to our bodies all day, every day, these ideas, preferences and expectations start to come out of the digital experience and into everything else that we participate in.

The second that your organization or your business doesn’t have a digital experience that allows people to get at those commonly asked questions with key information, or your digital information is out of date, that starts creating some conflict really quickly because now people feel disappointed. Because if other companies can do it, why can’t yours?

Wofford: As service providers, the next question that comes up is: well, what can we do about that? How do we manage these expectations?

Martyn: Start by paying attention to the questions people are asking. If you’re hearing the same question over and over, you should be thinking, “Whoa, this is a trend. We have an opportunity here.”

Wofford: If something comes up time and time again, it should really be searchable information on your website, right?

Martyn: Exactly. You should be thinking about how to make it more present on our homepage, whether that’s in the FAQs or the About section. You want to have that information available. I think a lot of service organizations tend to make the mistake of thinking that high-quality service is high-touch service. The second that you make the mistake of thinking that the only way to provide high-quality service is to force me to interact with someone on your team, you’re missing the mark because that might not be my preference.

You want to offer a choice by putting things online for the people who are going to go to your website and navigate there. It should also be easy to get ahold of someone who’s going to talk to me and engage with me maybe over the phone or in person, if that’s my preference. But you don’t want to choose for your consumers what’s going to be best for them. No one likes being told what they like.

Wofford: I really relate to that. Sometimes when you’re out to dinner and the server has come to you twenty times unnecessarily, it gets to be a little bit much. I understand that it comes from a genuine place of wanting to help, but it can be a little much. Now, let’s take on the idea of establishing operational systems. When you come to an organization and start working with a hospitality group, how do you get everybody up to speed and on the same page?

Martyn: You cannot climb the mountain the first time you ever go on a hike. It’s really important to identify your core problems and tackle those first. What can you put in place right away that will impact at least some guests?

Oftentimes, it’s an issue of bandwidth. You can’t see really great solutions if you’re behind the curve all the time. So start with a triage approach and identify the fast and easy things that will impact some folks and give you a little more space to start to then tackle the next, maybe more sophisticated, version of this solution. Don’t feel like you have to solve everything perfectly right away.

Wofford: What are the greatest opportunities that you can see with technology being able to help?

Martyn: I think it’s so easy to think that technology is going to solve it. That’s really not the right viewpoint. The viewpoint should be about how it supports us and supports anyone who’s interacting with our clients, our customers or our guests.
We talked about getting information up on your website, making your FAQs more available. What are those common questions that you’re hearing several times a day on the phone or over email? You need to get that information more quickly into the hands of your consumer so they can find it and move on with their day. That way, your frontline teams have more time and space to provide really meaningful interactions to the guests who really need it rather than anxiously trying to rush them through the conversation because there are ten people in line or the email inbox is filling up. You want your workers to feel like it’s acceptable and appropriate to take more time to work through those more complicated solutions. So it’s not only solving problems, but also making those investments to grow the relationship between your organization and your consumers.

Wofford: How do you see big data and analytics helping face-to-face interactions?

Martyn: You have to understand who the person is you are interacting with. Can you get a jump on some of that through the use of profile information? Does this person have a family? Are they a single business person? Where are they based? The faster I can get at that, the more sophisticated my engagement with them is going to be.

But there’s one thing I want to caution everyone against – and I feel very strongly about this – and that is that I’m a different person every time I interact with your brand. I am not the same person from my first purchase to my last. Travel’s a really great way to illustrate this. I’m a very different person with different needs and different expectations when I’m traveling alone for business than when I’m traveling with my husband for a getaway. It’s still me, so my profile’s going to say all the same things, but what I’m looking to get out of the service interaction really shifts depending on the context of my trip.

Wofford: What’s the takeaway on that?

Martyn: I think that’s one of the values of human interaction. The thing that’s emerging out of all the technology advancements is that there is still a very, very important place in the world for the human-to-human component of service delivery. And that’s true regardless of what industry you’re in. So, how do you take out all the perfunctory pieces?

Checking in or checking out of a hotel is a classic example. The process can be very perfunctory, focused only on the room number, the key, getting the customer to sign the waiver. But what if that interaction could be about something else entirely, and the room key and the waiver signature and the credit card are more like afterthoughts? What would be most helpful for the guest to have a wonderful stay? If there’s one thing the property could do for them over the next two days, what would it be? In my case, when I’m a business traveler, I might say that it’s providing bottled water. When I’m with my husband, I might say it’s letting us decide when housekeeping should come.

Wofford: Let’s say you’ve inherited staff who have worked for twenty plus years under one brand and they now find it difficult to follow a new training plan under a rebranded hotel. What do you do?

Martyn: Change is so hard for everyone. I think with all things, everybody wants to be a little bit in control. As an employee that means they want to know what their job is, how to do it well and how to do it in a way that is well respected. What’s really hard about what you’re going through is you have new expectations that maybe haven’t been completely explained to your team. And you’re probably sitting there going, “But I’ve said it ten times.” But that doesn’t mean that they’ve understood it or that they’ve bought in.

Companies have things like mission, vision, and values that help explain why they are doing the things that they are. In your re-flag situation, the answer can’t just be because the new brand says: “This is what we do.” If that’s the answer, or if that’s how it’s presented, there’s no incentive for employees to make an emotional investment into that adjustment.

Hypothetically, let’s say you re-flagged because the hotel wasn’t performing financially under the old brand. It’s important to explain that you were at risk of closing and ended up moving brands to better align with where you’re located, what your amenities are or whatever, so that you can keep the hotel financially viable and keep everyone employed. That’s a level of trust and transparency that also helps people understand why are they being subjected to this change. But how do you gain an emotional buy-in? And how do you work toward understanding what’s important to people in terms of what they’re really looking to get out of their job? Those are really two critical components in driving any change.

Wofford: What do you feel is more important, recruiting new employees or continuing to train existing ones?

Martyn: People say that you can’t train attitude. I actually don’t believe that. I believe training is incredibly valuable. I think that so often folks get written off as not caring or having a bad attitude, but I feel like you cannot say that that’s the case if you haven’t talked to them about the issue. I like to say “No one’s trying to be the worst.” It’s a bit sarcastic, but it means that until you feel 100 percent confident that you’ve sat this person down and explained what they’re doing, how it impacts other people, or how it’s being perceived, you can’t know that they are aware the problem exists. Until you’ve told them what they’re doing is wrong, you can’t assume that they know it.

My experience with a lot of training is that there are some people who are terrific with guests. I’m sure you have your rock stars and your people are amazing and everyone feels the love when they work with them. But if you ask them, “What did you do with Mr and Mrs So-and-So to make them so happy?” They’re going to give you a really bland answer because they don’t know what they’re doing. They’re just being themselves and fortunately for them it is perceived really well by the people to whom they’re providing service. But for people who don’t have that innate ability and want to do their job well, someone has to tell them. And some of the things that I think often go untrained are the things that don’t fall into the book of standards.

I’m sure at your property you have standards or guidelines about how you do certain things, what the rules are, how often you reach out to guests, how you communicate with them, or how many rings are allowed before you pick up the phone. All of that stuff oftentimes is documented. That’s like the ‘what’, the technical aspects of delivering your service. But the part that’s a lot harder is the ‘how’, which is actually what service excellence training is all about.

Wofford: What are your thoughts on maintaining an appropriate level of guest service when much of your staff is provided by third-party employment agencies? There are conflicting loyalties in terms of employment and focus.

Martyn: A lot of people have this, and if you have any kind of third-party contracts, or you have a management group interacting with an ownership group, it can be very, very complicated. But it goes back to what we were talking about before: getting people to understand the ‘why’.

Now, there could be a situation in which you are giving one set of directions and then the other manager that the employees technically report to is directly contradicting you, and that’s tricky. But that’s a technical piece that you have to work out between the two managers to make sure that the messaging is really consistent.

What is helpful is to make it less subjective and not about one person’s opinion versus another’s, because there’s not one person on this planet who isn’t going to say that their opinion is better. That’s just human nature. So you need to make it more objective by creating a rather vanilla, opinion-free approach to the decision-making process.

So with your different stakeholder groups, I would encourage you to go back and figure out those things that everyone is in alignment on. Maybe it’s financial incentives, maybe it is about guest experience. Once you figure out what the common point of departure is, you start to look at every situation and scenario through that common lens.

Wofford: How do you communicate metrics to frontline staff and turn it into something actionable?

Martyn: First off, hopefully everyone out there is measuring their guest experience. If you’re not, make sure you’re collecting those post-experience surveys. Consumers around the world are well trained, so there are pretty reasonably high response rates. So if you’re not yet doing a post experience survey, that’s a huge opportunity for you.

So, how do you take that information and make it into something real? Something I’ve seen done really effectively is figuring out a way to provide accolades to the people who are your stars. You might have to write questions into your survey like, “Was there any member of our staff who was particularly helpful to you?” Once you start getting that information, make a point of celebrating that Anna got three comments this last month or Sean was mentioned five times. So first off, make it personal. The scores themselves are hard to connect with and quite frankly, they’re really arbitrary benchmarks. We can’t even be sure they’re interpreting our questions correctly. But if you start to look at your qualitative data, your open-ended questions, then you have this opportunity to really raise up employees that are doing well.

Wofford: Do you have an example of a recent service interaction that really blew you away, that we could sort of look to as an example to follow?

Martyn: You know, I really see a lot of examples of great customer service, but for me I’m not really looking for some sort of special gesture. I don’t want anything comped. I don’t want a complimentary dessert. I really don’t want any of those things because so often they are a sign that the basics were not well executed. The best experience for me is when everything just happens. I don’t need anything special. I just want to pay for the thing or service that I wanted, and it all just happens smoothly so that I can pay my bill and leave. That is truly the best experience. As soon as you get into talking about ‘surprise and delight’, which is a common industry term, or these ‘above and beyond’ gestures, they actually don’t hold a lot of value for me.

So often, these gestures are nice and thoughtful, but they’re not really what I want. As an example, let’s say I’m unexpectedly delivered a cheese tray. Well, okay, that’s nice, but I’m not hungry now and I’m checking out at six am tomorrow, so I’m not going to eat it. I think it’s so hard to get gestures right in a way that’s actually very meaningful and relevant to the individual because what they need at any given time is constantly shifting. For me, I’d really rather have that energy and time invested in just doing what I originally asked for extremely well.

Wofford: Do you have any thoughts and strategies on first impressions?

Martyn: Picture this. You’ve just driven eight hours with your children and they were crying for the last hour of the journey. How do you feel when you get to that hotel? Do you feel great? No, you feel exhausted and at the end of your rope. The same could be said after a day of air travel or even a long day of work. So you’ve got a guest who is coming into what’s supposed to be this restful thing or happy thing. But so often we as guests are carrying our own baggage, or maybe we really need to use the restroom because we haven’t stopped for hours. Whatever. Then you arrive and you’re given the check-in information, the Wi-Fi password, and all that. So the guest is already feeling tired and overwhelmed and the warm cookie just isn’t going to be as effective as it would be when the guest is relaxed, isn’t lugging around their 50-pound bags and so on. Then all of a sudden the cookie would create a much larger impression because the guest has more bandwidth to absorb it.

So I would say that it’s important to really think about those first impressions. There is so much already going on during that arrival experience, so how can you take the non-necessary things out of the experience so it feels less overwhelming?

Wofford: Has your research revealed any meaningful generational differences when it comes to employees delivering amazing guest experiences?

Martyn: The research I’ve done hasn’t focused on that directly, but I can offer some of my impressions. I think generationally, what is different, goes back to the beginning of our conversation, when we talked about identifying ‘the why’. Why should I care? What’s in it for me? That’s what’s really different generationally.

Your oldest group and cohort in the workforce might not be super comfortable with tech but they have a ton of experience. They used to think customer service just meant smiling, and now you’re trying to tell them it’s all these other more sophisticated things. You have to be able to really help them understand how the changes that you’re recommending are actually going to impact the guests. Oftentimes that group in particular is so emotionally invested in the guests. They just want them to have the best time. They are so committed to that, so you have to be able to connect the dots for why that’s important.

The younger employees are going to find the tech part so easy. They’re really flexible and nimble and they want to learn. They have a different ‘what’s in it for me’ reason to adjust what they’ve already been told. On the other hand, the younger employees might need help making better connections with the guest base, who might not be just like them. Trying to better communicate with 40, 50 or 60-year-olds can be a struggle because those people aren’t like them. So although I don’t have formal research on this, what I would recommend is kind of stepping back and thinking about the different groups in your workforce and what’s important to them in terms of feeling satisfied with their job and like they’re doing the right thing and then helping to connect the dots between what you’re asking of them and the values that they hold, because they could be very different based on generation.

Wofford: Beautiful advice. A big thanks to Elizabeth for joining us today.

Why I’m Quitting Online Shopping This Year

This holiday shopping season presents another mega-consumption opportunity that will separate successful retailers from the rest of the pack as the list of 2017 store closures and anticipated 2018 store closures continues to grow. Six weeks from now, consumers across the country will have demonstrated to retailers – with their dollars – just what exactly it is that they are looking for as the new shopping economy takes hold.

My money, literally, is with any retailer that’s willing to give me a memorable in-store experience.

Since the massive influx of online shopping, the world of what is known as “differentiated goods”, or products that vary significantly from retailer to retailer (think clothing, home wares, gadgets), has largely lost sight of the fact that these products require some type of experience or interaction to actually confirm the purchase. Basically this means that I, as a consumer, need to feel the material, try on the size, see the color/pattern, or physically test out the gadget in person before actually deciding to keep that product in my life.

recent study by PwC confirmed that only 3% of in-store clothing purchases result in returns, while a whopping 25% of online purchases are returned. The numbers tell the story loud and clear – a live interaction with the product is critical for sales retention and retailer success.

But why did shoppers abandon brick and mortar stores in the first place? When online shopping came, well, online, it caused a seemingly overnight and massive disruption in the sales of consumer goods. With revenue shifting away from brick-and-mortar stores, retailers panicked, and like a herd of sheep, they all made the obvious choice: they cut costs. Personnel were let go, wages reduced, and turnover was rampant. Then came the natural consequence of those decisions: terrible shopping experiences in dirty, cluttered, and understaffed stores manned by stressed-out, poorly trained, and inexperienced salespeople. No rational person would subject themselves to that horror show when you could sit on your couch and order the same goods online. So you and I, and everyone else in America, did just that – we stayed home.

Fast forward a decade, and I am not alone in having grown tired of the order-and-return circus that is online shopping. Some savvy brands are finally recognizing this growing consumer frustration and starting to tackle the problem by revamping and reinventing the in-store experience. The most widely known for this is Best Buy, who overhauled their store experience and pricing strategy to do precisely what Amazon cannot – give you an opportunity to look, hold, examine, and discuss their tech gear before hauling that massive box into your living room or wrestling the new mouse out of a clam-shell package that’s more difficult to break into than Fort Knox. Best Buy has realized what consumers already know – online shopping is exhausting and can be ridiculously ineffective for certain goods.

Best Buy’s strategy isn’t just marketing fluff. Earlier this month my husband and I headed to our local Best Buy to check out their inventory for a new computer monitor for our home office. What we encountered was a great selection, multiple salespeople who could speak specifically about the monitors we were looking at (I was truly shocked) and the realization that ordering online would’ve been a disaster since we use a funky space for the office. The in-person evaluation completely changed our plan and allowed us to get something that was the right size and scale for our home – there was value in the in-store experience. Not to mention, it was such a relief to have a fun, enjoyable, and actually helpful and productive visit to a brick-and-mortar store.

Retail shopping has a lot of life and legs in the new economy, as people are burned out after getting burned by shopping online. The future of brick-and-mortar retail (I’m looking at you, clothing stores) is the “showroom” or “gallery” shopping concept. At a showroom, consumers go to a retail location to experience products and then place orders while in-store. Bonobos has already proven the value of their Guideshop model through their acquisition by Walmart, and even Amazon is opening bookstores just to encourage you to download titles to your kindle while you browse. Showrooms offer an opportunity to combine the best of all of shopping elements: excellent service by knowledgeable staff, a comfortable in-store experience, and the opportunity to fully test, try on, and evaluate products with the convenience of shipping directly to your home.

By focusing on the experience of shopping, rather than the transaction of shopping, retailers can bring customers back to brick-and-mortar. This holiday season I’ll be rewarding those retailers that are trying – even if not always succeeding – to deliver a high quality in-store experience. Best Buy has already won my business and my money; what remains to be seen is which other retailers will rise to the occasion, reinvest joy and value in the in-store experience, and ultimately survive in the new shopping economy.

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Why Branding is Dead, and Why Mindset Is Your Only Hope In the Future

There was more content created online in the last two years than was created in all of the prior 2000 years. Every conversation, tweet, and piece of content is a part of your brand image, and impacts a prospect’s experience with your brand.

The future success of your brand relies on you being able to provide and manage a positive experience across over 60+ marketing channels, 24 hours a day. Simple branding no longer works; the only sustainable way to consistently provide a positive experience to your prospects is by understanding Mindset.

Salesforce.com’s Mathew Sweezey explains why the modern digital landscape has killed the traditional concept of branding, and why Mindset is your only hope for building a consistent brand in the future.

Mathew Sweezey is the Head of B2B Marketing Thought Leadership for Salesforce.com. A consummate writer, he authors a column for Clickz.com on marketing automation, has been featured in publications such as Marketing Automation Times, DemandGen Report, Marketing Sherpa, ZDNet, and is the author of Marketing Automation for Dummies. Mathew speaks more than 50 times per year around the world at events such as Conversion Conference, Dreamforce, SugarCon, and to companies including Microsoft, Investec, NetJets, and Restaurants.com, to name a few.

Psychographic Segmentation – What Is It and Why You Need To Use It

No two people are created equal, and no two customers are identical. Market segmentation is a must for any company that wants to maximize its reach. Even within a specific niche, segmenting enables you to reach different sections of society, giving you inroads to more customers and increasing the loyalty of those consumers.

Demographic Segmentation

The most common form of segmenting is breaking down a population by demographics. For example, men might get a different message than women, and older customers would receive a different style of marketing than younger consumers. On the surface, this is a great way to differentiate between groups of customers who are fundamentally different and cannot be reached via identical means.

However, while demographic segmentation does have its place in marketing, it’s not the most efficient way to segment. To really find out the divisions in your marketplace, you have to dig a little deeper. After all, there’s more to people than their age or gender. Behaviors and attitudes are far more important in terms of creating customer profiles and identifying ways to reach groups of people.

Psychographic Segmentation

Psychographic segmentation takes the traditional forms of segmenting and goes well beyond the barriers that once existed. As the name suggests, psychographic segmentation ventures into the various ways that people think and feel about the world around them.

The more you understand a population, the better you’ll be able to market to this group. Psychographic segmentation allows you to develop new insights based on questions you might never have considered. For example, you can learn whether your customers value price or brand name, and you can also see how different discounts affect buying behavior.

The sky’s the limit with psychographic segmentation, but the deeper you try to go with market segmentation, the more diminishing returns you’re likely to receive. For instance, sending out surveys to determine consumer behavior only works if you get a high response rate and your customers tell the truth. Psychographic segmentation also requires frequent maintenance and updating of customer profiles. After all, demographics rarely change, but people’s attitudes change frequently.

In spite of some flaws, psychographic segmentation is easily the most effective and incisive way to understand your customers and give them the personal touch that’s necessary to retain their business. To learn more about psychographic segmentation and other market research tools, check out eCornell’s Marketing Strategy Certificate. This online program offers in-depth training on:

  • Marketing strategy, marketing research and analysis
  • Applied tools such as segmentation, targeting, positioning, and strategic pricing
  • Brand management and brand equity
  • Promotion strategies

Get more information on our Marketing Strategy Certificate.

Finally! How To Close the Sales-Marketing Gap With Social Media

User-generated and brand-generated content on social media are great for bringing value to the customer relationship, but ultimately you’ll want to encourage a transaction. If your audience is engaged but you’ve failed to produce a desired result or a transaction, then it’s time to revisit your social media marketing strategy.

According to Forrester Research, US marketers are projected to spend $16.2 billion in social media advertising by 2019, which can inadvertently drive customers away from the point of transaction if done incorrectly.

You don’t own your customer on social media. You are only renting your space on platforms like Facebook, Twitter, Instagram, Youtube, and Pinterest. It’s time to reclaim ownership of your content and see true ROI from your marketing efforts.

In this informative session, Hashtagio’s Alicia Whalen explores how the marketing mix has shifted in the age of social media, and we’ll look at how a poorly executed social media plan can inadvertently direct a customer away from the path to purchase. You’ll learn how to close the gap between social media and sales and enjoy true ROI from social media marketing.

UPDATE: It was a great session > Watch it here.

 

 

Account-Based Marketing & the Future of B2B Demand Gen

Account-based marketing (ABM) is shaping up to be the biggest revenue driver for B2B sales right now. While ABM as a business strategy has been around for quite some time, emerging technologies and new ways of looking at customer data have enabled it to become the go-to B2B strategy right now.

ABM is a red-hot topic in business, but many sales and marketing departments are still surprisingly unclear about why and how ABM works. So we’ve assembled a team of expert panelists to look closely at ABM and discuss its implications for the near and distant future.

In this 45-minute video panel discussion, we’re joined by three leading experts on account-based marketing: Engagio’s Jon MillerMaria Pergolino from Apttus, and Craig Rosenberg, aka the Funnelholic, from TOPO. So don’t miss this video; it’s essential viewing for B2B marketers and sales teams.

And there’s more! We covered a lot of territory in the video, but I highly recommend these resources from our panelists:

Determine Your Customer Lifetime Value

Marketing is all about maximizing a customer’s financial contribution to your brand. The more a customer spends on your products or services, the better it is for your bottom line. But there’s more that goes into a customer’s value than a big purchase here and there. We’ve taken the formula for determining your customer’s lifetime value from our certificate in Data-Driven Marketing to give you a sneak peek into the Ivy League strategies we can offer to enhance your marketing campaign.

Customer Lifetime Value Equation

You can use a simple equation to determine exactly how valuable a customer is to your overall success as a company. By figuring out the customer lifetime value (CLV) for your top customers, you’ll be able to see just how much each contributes to your revenue goals.

The customer lifetime value calculation consists of three distinct parts, which are multiplied to give you a quantifiable figure that shows a customer’s overall worth. Use this formula to see how your top customers shape up or to analyze a specific segment to see how certain customers can become more valuable.

Average Spend

The first part of the equation is simple. How much does a given customer spend, on average, when he or she patronizes your business? This number can be easily calculated through any sort of internal database you may have. You can also help to drill down to the individual customer by using customer loyalty cards or personalized website logins for online purchases.

Repeat Sales

Knowing how much a customer spends is only valuable if placed in the right context. A customer who spends $1,000 for a one-time purchase is less valuable than someone who spends $100 each month over the course of a year. While you obviously want a customer to spend as much as possible, the frequency with which a customer shops is just as important. Furthermore, frequent visits show a measure of loyalty that can’t be quantified by looking solely at a customer’s average expenditure.

Retention Time

Let’s face it, there’s no such thing as a lifelong customer. You’d be foolish to expect a customer to stick around forever. But you can figure out how long the average customer supports your business and apply that to the general population. Again, the longer the retention time, the better off you are, but some businesses aren’t based around lengthy periods of retention. For example, a store that specializes in baby merchandise won’t be able to retain customers for as long as a store that targets adults.

When you multiply all three of these elements, you end up with a figure that can be used to represent a customer’s lifetime value to your business. This amounts to the present value of future cash flows, so you may end up getting more out of customers than you expect. In any case, customer lifetime value is a great tool to use as you attempt to identify and target your most important customers.

Alternate Calculations

The calculation described above is just one way to calculate CLV. Other formulas incorporate additional factors, such as acquisition costs, direct mailing costs, and your company’s margin rate.

If you’re interested in learning more about CLV and other marketing concepts, consider the Data-Driven Marketing certificate program offered by eCornell. You’ll learn about the elements that comprise customer lifetime value, as well as how it can best be used as part of a comprehensive marketing campaign.

How to Write Market Positioning Statements

Your organization is gearing up to launch a new product or service, or enter a new market. You’re on the marketing team. You’re familiar with the details of these new endeavors; you know your customers. Where do you start? (The following guide is an excerpt from my Marketing Strategy certificate.)

Start with the positioning statement.

A positioning statement is a concise description of your target market as well as a compelling picture of how you want that market to perceive your brand. Though it may read like something from your promotional materials, your positioning statement is an internal tool. Every product and marketing decision you make regarding your brand has to align with and support your positioning statement. A good positioning statement is a guidepost for your marketing efforts. It helps you maintain focus on your brand and its value proposition while you work on market strategy and tactics.

Guidelines for Good Positioning Statements

What makes a good positioning statement? Here are six keys to keep in mind:

  1. It is simple, memorable, and tailored to the target market.
  2. It provides an unmistakable and easily understood picture of your brand that differentiates it from your competitors.
  3. It is credible, and your brand can deliver on its promise.
  4. Your brand can be the sole occupier of this particular position in the market. You can “own” it.
  5. It helps you evaluate whether or not marketing decisions are consistent with and supportive of your brand.
  6. It leaves room for growth.

Template for Writing a Positioning Statement

Here’s a basic template for writing a positioning statement:

For [insert Target Market], the [insert Brand] is the [insert Point of Differentiation] among all [insert Frame of Reference] because [insert Reason to Believe].

  • The point of differentiation (POD) describes how your brand or product benefits customers in ways that set you apart from your competitors.
  • The frame of reference (FOR) is the segment or category in which your company competes.
  • The reason to believe is just what it says. This is a statement providing compelling evidence and reasons why customers in your target market can have confidence in your differentiation claims.

The wording of your positioning statement doesn’t have to match this template exactly, but to be effective, it must contain the five main components in brackets above. Occasionally, a positioning statement will contain a point of parity, when it is central to a product’s positioning.

Above all, your point of differentiation, frame of reference, and reason to believe must be meaningful, important, and convincing to your customers, not just to your company.

Examples of Great Positioning Statements

The following positioning statement was used by Amazon.com in 2001, when it sold books almost exclusively:

For World Wide Web users who enjoy books, Amazon.com is a retail bookseller that provides instant access to over 1.1 million books. Unlike traditional book retailers, Amazon.com provides a combination of extraordinary convenience, low prices, and comprehensive selection.

Our fictitious company, Underfoot Industries, has decided to pursue two target markets: schools and light commercial customers. These are distinct market segments whose customers rate their needs differently, so the company must develop two positioning statements:

For schools, the Underfoot Industries EverAwesome line is the strongest, most durable carpet among all commercial-grade carpets for organizations on a budget, because it is made using our patented SteelTwist technology. The EverAwesome line features Underfoot Industries’ patented technology for producing high-strength, low-wear carpets. Underfoot named its production technology “SteelTwist” to appeal to customers, such as schools, who place a very high value on carpet strength.

For today’s appearance-conscious business, the Underfoot Industries EverAwesome line is the carpet that stays new-looking longest among all commercial-grade carpets. Our patented technology produces durable, low-wear carpet whose lifetime cost is 40-80% lower than other brands. The brand name “EverAwesome” tells customers: “This carpet looks great, AND it will last a long time.”

If this guide to market positioning statements has helped you guide your marketing strategy, I highly recommend you learn more about the Marketing Strategy certificate I teach through eCornell. It covers communicating the value of your brand in more detail as well as marketing research and analysis, distribution strategy, decision-making, and new media marketing.

Update: Thanks to the immense popularity of this post and all the great feedback we have received, we created a free Market Positioning Statement generator. Simply plug in a few pieces of information, hit submit and get your statement in 30 seconds! It’s time to take your business to the next level- check it out here.

Mastering the Hotel Marketing Ecosystem at the Property Level

Today’s hotel visitors have never been more connected. With multiple devices and countless online resources to consult during each phase of the guest lifecycle – from the point they make their booking decisions to well after they check-out – travelers’ hotel expectations have shifted.

Long gone are the days when the hotel marketing tactics were all deployed pre-stay and offline. Today, easier access to guest preference data, past purchase behavior and social media profiles has made the hotel marketing discipline a multi-phase and multi-channel practice that requires involvement from many different key stakeholders at the brand and hotel-property level.

In this webinar, Greg Bodenlos, social media and digital marketing hospitality consultant, walks us through this complex hotel marketing ecosystem. In the process, Greg reveals strategies and tactics for mastering the innumerable amount of hotel marketing priorities. The following are just a few of the questions that will be addressed:

  • What are the most important marketing focus areas at the property level?
  • How has the definition of hotel marketing evolved in the hospitality industry?
  • Where should hotel marketing live in the overall hotel operation ecosystem?
  • Who are the various key stakeholders to involve in hotel marketing initiatives?
  • What new hotel marketing challenges are on the horizon?

Greg Bodenlos is a passionate hospitality marketing consultant and HSMAI leader based in Boston, Massachusetts. With a passion for digital trends, social media and innovation – and over five years of hotel and technology work experience – Greg possesses a unique perspective on the hospitality digital marketing landscape. Playing digitally-focused marketing roles at the destination resort, luxury independent property, and now city center hotel has allowed Greg to play an active role in shaping hotel marketing best practices at the property-level as well as help bring hoteliers closer to creating more meaningful, personalized travel experiences for their guests. It was in his marketing role at Revinate – a SaaS start-up in Silicon Valley that designs and develops technology to improve the guest experience – where Greg was able to help hoteliers and academics better understand the power of leveraging consumer intelligence to drive better service and maximize revenue streams across the entire guest lifecycle.

Greg is a proud graduate of Cornell University’s School of Hotel Administration and has been featured as a hotel marketing expert on National Public Radio. Greg has been featured as a contributor in Crowdcentric Media’s Social Media Week New York blog, eCornell’s Blog and HotelMarketing.com, as well as played a co-authored role in an award-winning piece for Cornell University’s Center for Hospitality Research with Chris Anderson entitled Best Practices in Search Engine Marketing and Optimization.

Greg can be reached by phone at +1 781 686 2177, email at gregbodenlos@gmail.com, on Twitter @gregbodenlos or LinkedIn.

Price Positioning Strategies

Learn the merits and drawbacks of five price positioning strategies and use our price positioning worksheet to experiment with your own pricing strategy.

The Internet has dramatically changed hospitality pricing. Its speed and transparency have removed most barriers between customers and suppliers. With OTAs like Hotwire, Orbitz, and Hotels.com, you no longer need be an industry insider to find the best pricing to suit your needs. Yet, hotels and restaurants still need to make pricing decisions; these new challenges simply up the ante. Today, we’re looking at five price positioning strategies, explaining their merits (and drawbacks), and providing examples. When you’re done reading, download a free price positioning worksheet to experiment with your own pricing strategy.

The Price-Value Matrix

Many factors will influence your prices, including your competitors’ rates and products. As the name implies, your goal is to develop a pricing strategy that places your brand and its products in a certain position relative to your competition. One way to visualize this is the price-value matrix (right).Price Positioning -- The Price-Value Matrix

The position of your products within this matrix is a function of your brand proposition, your competitors, and your pricing objectives. Are you looking to maximize short-term revenues or profit? Are you seeking higher profit margins in a luxury market with sporadic sales? Do you need to differentiate more to penetrate the market? Or, is your business in survival mode?

Once you identify your pricing objectives, plot your prices and those of your competitors on the price-value matrix. At a glance, you’ll see how your pricing lines up with your objectives. If your rates need tweaking—either because they “say” the wrong things about your brand relative to competitors, or because they’re undermining your pricing objectives—consider using the following strategies to position your rates or prices more appropriately.

Price Positioning Strategies

Skim

This strategy clearly positions your company above the rest; it tells consumers something is special (i.e., worth paying more for) about your products. For example, look at the prices The Old Homestead restaurant has set for their steaks and chops. We can smell the fried onions and seared, aged prime meat already. We can envision the long white aprons of the wait staff and the impeccable table side service. To skim, set your prices higher than the competition does in order to “skim off” customers who are willing to pay more. This strategy can be highly profitable, but be careful: Though high prices imply high quality for many customers, it’s still critical that they understand why they’d pay more to stay or eat at your establishment.

Match

This strategy puts your pricing on par with the competition, but not necessarily for all rates. To match, set one rate comparable to your competition and another slightly higher. This allows you to stay competitive for a larger pool of customers, yet doesn’t undercut the competition.

Surround

Price Positioning Strategy - SurroundThis strategy positions your first room type as the cheapest in the market, but offers your rooms with better options at a price that’s close to your competitors’ first available rates. Hence, you’re “surrounding” the middle market, hoping to capture customers willing to pay in those ranges. For example, look at Sizzler’s $16.99 sirloin steak and lobster special.

Outback Steakhouse offers a similar item for $24.99, but uses a filet and includes two sides instead of one. Outback also offers a 6 oz. sirloin steak for $10.99. This strategy allows Outback to attract customers looking for an inexpensive steak dinner, while offering customers willing to pay more, well, more, but at a price far shy of Ruth Chris’s smallest filet steak at $35.

Undercut

By undercutting your competitors’ rates in some categories, you can potentially attract more customers. To undercut, offer a price that’s comparable to your competition and another that’s lower. Take this example from the hotel industry.Price Positioning -- Undercut

Both hotels are located near a major airport, both have the same star ratings and amenities. But look at their airport parking packages for 14 days free parking plus a room: $359 versus $189.  These hotels had very similar best rate rooms, but one has chosen to undercut their competition on this package, likely in hopes of driving more cost-conscious travelers their way.Price Positioning -- Undercut

Price Positioning -- Penetrate

Penetrate

Being the low-priced option in your market has benefits and drawbacks. The strategy is primarily designed to get people in the door and in seats. For new establishments, low prices often seem the best way to entice consumers to try their products. But this strategy also can depress market prices, lower margins, and set a poor precedent as your business grows. Do your prices reflect how consumers value your hotel or restaurant? Here’s what consumers see as they peruse online hotel options; those using penetration pricing certainly stand out.

Set Your Own Price Positioning Strategy

Price Positioning WorksheetHere’s an exercise taken directly from my eCornell course series New Media Marketing for the Hospitality Professional. This example illustrates the outcomes of five pricing strategies if your competition is charging $79.

Now, download your free price positioning worksheet here.

Though pricing can be a complex issue, this simple, effective tool provides an excellent start.