Customer Service Management for Tourism and Hospitality - Assignment

CUSTOMER SERVICE
MANAGEMENT FOR
TOURISM AND
HOSPITALITY

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Different components of CRM model that a Hotel could follow................................................1
...........................................................................................................................................................
TASK 2............................................................................................................................................6
Application of CRM model to The Pig Hotel.............................................................................6
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
This study is based on customer service management. It refers to practices and strategies
which the hospitality industry use in order to interact with their customers. Customer service
management helps in improving the services provided to customers and this assist the company
in retaining their customers. This case study will include The pig hotel to apply the CRM model
in order to engage customers in the daily activities. This assignment will define about the
customer relation management and its various components. It will also discuss about CRM as
business strategy in a hospitality sector to interact with customers. This study will discuss about
staff retention and various benefits of implementing CRM in The pig hotel.
TASK 1
Different components of CRM model that a Hotel could follow
Definition of CRM
Customer relation management refers to the organisation relationship with their
customers in order to increase their customer base in the market. Company in order to satisfy
their customers demand regarding the products and services have to interact with them .
Customers relationship management includes various strategies which helps in maintaining the
healthy relationship with the customers. Customer relation management helps in identifying
various needs of the customers which helps in designing the product according to their taste and
preferences.
Overview of IDIC model of CRM
IDIC model of customer relationship management was developed by Peppers and Rogers
in 2004. This model of CRM was developed to suggest companies about four action which they
have to perform in order to build relationship with the customers (Chathoth and et.al.,
2016) .This model of customer relationship management consist of 4 actions which organisation
have to follow to retain their customers. They are:
1. Identification: This action of IDIC modal suggest the company to identify its
customers in order to build an understanding about their products and services in
the mind of their consumers.
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2. Differentiation : Differentiation include that the company must differentiate its
customers in order to identify which are valuable to firm in present and those
which are important for future. This action assists the firm in identifying about
various potential customers and their demands.
3. Interaction : Interaction with customers help the organisation in identifying
various expectation of the customers with company and their issues related to
existing product line of the firm which the enterprise must improve in order to
attract more customers.
4. Customization : Customization refers to modification which are required to build
interaction with the customers (Kandampully, Zhang and Bilgihan, 2015).
Customization helps the company in ensuring that the expectation of the customer
are met by customizing the offer and communication.
Importance of the components of IDIC model for successful CRM
IDIC model of customer relationship management helps in building a good connection
with the customers by using various components of IDIC model.
 The components of model help the organisation in successful implementation of
customer relationship management by identifying various customers of their
products and services and also identifying the potential customers for the hotel or
hospitality sector.
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Illustration 1: IDIC model
(Source :The IDIC Model, 2017)

 The components of the model which helps in successful CRM includes
identification, differentiation, interaction, customization which helps in building
strong relationship with the customers (Aryee and et.al., 2015).
 Differentiation helps the company in successful customer relationship
management by differentiating the customers on the basis of existing customers
and potential customer's in order to find out the demands of their customers which
assist organisation in designing the products according to the demand existing in
the market.
 Customization helps the hotel in successful CRM by building a relationship with
customers using offer and communication for satisfying consumers regarding the
products and services delivered by the hotel.
 Components of CRM includes sales force automation, customer service,
marketing, lead management etc.
Benefits of using CRM in hospitality industry
CRM assist the hotel and various sectors of hospitality industry in retaining its various
existing and potential customers (Cook, 2017). Customer relationship management provided
various benefits to hotel industry such as :
 CRM assist the hotel in retaining its customers by satisfying them with their expectations.
 Customer relationship management provide benefits to hospitality industry by increasing
the share of category spend .
 CRM also assist the hotels in providing various services to its customers by identifying
their demands.
 CRM also assist the business in developing various business strategies which help the
organisation in improving its communication channels, marketing strategies to attract
more customers etc (Gursoy, Cai and Anaya, 2017).
 CRM helps the hotel in improving their customer support services.
Theories of Effective CRM
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Relationship marketing theories : It includes three types of relationship marketing which
consist of database marketing, interaction marketing and network marketing. Database marketing
is related to use of technology in order to attract customers and fulfil their demands regarding
various products and services offered by the organisation. It is an internal marketing used by the
company. Interaction marketing which involve interaction with the individuals to promote the
products and services of the firm ( Dhar, 2015). Interaction marketing is related to external
marketing. Relationship marketing theory is bases on two aspects : 1. Market based 2. Network
based.
Customer relationship management theory involve justice theory which consist of
relationship marketing and customer focusing. Justice theory is based on trust, satisfaction and
loyalty which must exist between organisation and customers. Justice theory consist of
distributive theory, interactional theory and procedural theory (Subramanian, Joshi and
Deshmukh, 2018). Distributive theory means the perspective of the customer regarding fairness
of outcome. Interactional justice is related to fairness of the interpersonal interaction in decision
making. Procedural justice is related to fairness in the process to build strong customer
relationship.
Effective CRM approach
Customer relationship management in order to build strong relationship with the
customers focus on integrated approach of CRM in order to look beyond the fragmented
approach of CRM. Fragmented approach of CRM is the one which is related to each functional
group which are implementing their portion independently (Aryee and et.al., 2017). Fragmented
approach of customer relationship management lacks vision and strategy. Integrated approach of
customer relationship management is based on the system vision which matches the goals and
abilities that are link with organisation business strategy.
The integrated approach of customer relationship management assist the firm in
increasing their overall operational efficiency and also helps in improving the automation
process. Integrated approach provide assistance to the hotel and other sector of hospitality in
increasing the time spent on marketing and servicing customers. It also helps in eliminating
duplication of work.
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Customer relationship management practices adopted in Hotel sector
Customer relationship management practices are implemented in the hotel to retain their
customers with the help of providing its customers with the best services and facilities. Customer
relationship management practices include technology based practices, managing relationship
practices, Train employees etc. Technology based practices involves social media involvement
where the hotel ensure that online platforms are responsive in order to attract customers with the
help of using social sites such as Instagram, Facebook etc. that assist the firm in identifying
various demands of their customers which provide assistance to the hotel industry to make
available various facilities in order to satisfy their customers wants. The different practices
adopted by the Hotel assist them in building connection with their customers in order to build
relationship which support the firm in increasing their profitability level (Glennon And et.al.,
2016.). These practices which are adopted by hotel to build relationship with customers helps in
identifying the defects in the product and services which are offered to customers and thus
improve the performance level of the organisation. CRM practices helps the Hotel sector in
achieving their goals by effectively working towards the customer satisfaction.
Facts and statistics related to CRM
 CRM system helps the Hotels to have complete understanding of their customers. It
assists the firm in gathering the data related to their customers which helps the
organisation in improving their customer experiences.
 Mobile CRM the Hotel sector in improving their sales productivity. It helps in improving
sales forecasting through which customers demand are met according to their taste and
preferences.
 CRM system helps in increasing the lead conversion 80 % of the companies started using
CRM system which increased their leads.
 Cloud based CRM solution which have increased to 87% from 12 % since 2008 which
helps the organisation in finding solutions.
 Implementation of CRM system have increased the satisfied users to 66%.
CRM evaluation with its long term value to The Hotel sector
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 Customer relationship management helps in retaining customers in order to fulfil the long
therm goals of the hotel. CRM system is implemented to know the expectations of their
customers by gathering their data .
 CRM is beneficial to the Hotel sector because it assists in updating customers with the
help of automation and eliminating non- core tasks.
 CRM assist the organisation in formulating various strategies relating to future which
involves feedback, reviews etc. to improve the efficiency level of the Hotel sector.
 CRM sometimes provides some disadvantages to the organisation such as costly
implementation of system, burdensome data entry, waste of time if it is not properly used.
TASK 2
Application of CRM model to The Pig Hotel
Customer relationship management model is used to build a strong connection with the
customers in order top retain their customers to fulfil their organisation objectives. The Pig hotel
is expanding its business in different countries such as West Sussex , Cornwall etc. in order to
develop their market in those countries. IDIC model of customer relationship management helps
in developing a relation with their customer by providing their customers with quality services
and improve their efficiency level. CRM provides various benefits to The Pig Hotel such as :
 Customer relationship management helps The Pig Hotel in gathering the information
relating to their target customers.
 Implementation of CRM benefits The pig Hotel in expanding its business in West Sussex
and other places to attract customers of that place by providing them various products and
services relating to their expectation.
 CRM will provide benefits to the Pig Hotel in retaining their customers in the new market
by providing them with quality services and facilities which are different from the
competitors.
 CRM assist the Pig hotel in improving their customer support services which helps them
in increasing their profitability level in the new market.
IDIC model of customer relationship management assist the Pig hotel in identification,
differentiation, interaction, customization. These all elements of IDIC model provide
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support to the Hotel in identifying their potential customers and interact with them in order to
retain their existing customers.
Cross -selling and up-selling Opportunities:
Cross -selling is a strategy to sell the products which are complementary in nature. It is
the used in hotel sector to sell the unsold rooms in order to generate revenues. This strategy
involves ancillary products such as spa treatment etc. on bookings. Up selling is related to
encourage customers to spend more on their current product such as upgrading their room
choices etc. The pig Hotel in order to grab opportunities relating to cross selling and up selling
must identify their customer behaviour. Cross – selling is provided to the existing customers in
order to promote the different services of the hotel.
Acquiring new customers :
New customers can be acquired by implementing CRM system in the hotel by identifying
their customers purchasing habits, taste and preferences. It assists the organisation in attracting
customers by providing various services and facilities according to their demand. New customers
are attracted by improving the marketing style of the hotel. The Pig Hotel in order to attract more
customers ensure that the services provided to the existing customers consist of high quality so
that they will refer about the hotel to their friends and family.
Staff retention : Employee retention is related to the ability of the organisation to retain its staff
members. Employees retention assist the Pig hotel in acquiring their customer trust and loyalty.
Staff retention is acquired by providing the employees with better training, and various
compensation and benefits to the employees for performing their best in the achieving the overall
objective of the Pig hotel. CRM implementation in the pig Hotel will provide job satisfaction to
the customers and thereby reducing the employee turnover (CRM customer relationship
management, 2018). CRM practices assist the firm in increasing their employee satisfaction and
thus helps in retaining their staff.
The effective use of CRM software in the Pig hotel : Customer relationship management
software is developed in order to maintain various activities relating to customer data, customer
interaction, automate sale , access business information etc. this software include such as sales
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force, sugar CRM, Really simple system, Net suite CRM, Zoho etc. are the CRM software which
are used by the hotel in order to build customer relationship management. CRM software helps
the organisation in improved informational organisation, CRM software helps in enhancing
communication channels (Shin and et.al., 2017). It also helps in improving analytical data and
reporting. CRM software creates a coherent and cohesive body of information that drives the
value proposition of The pig hotel. It is a tool which provide value to the Pig hotel by effectively
managing the customer services and thus provide its customers with high consistency level.
Customer relationship management create value to the Pig hotel by providing their
customers with a opportunity to give feedback and reviews in order to know about the services
and product delivered by the hotel in order to improve their product line and increase the
efficiency level of the organisation. Customer sacrifices its time , money etc. in order to acquire
the product and services . The pig hotel in order to create value to their customers by engaging
them in day to day activities of the hotel such as providing customers with various discounts and
offers on hotel booking in order to attract them towards the hotel. The pig hotel must ensure that
various information regarding new products and services are delivered to their customers with
the help of customer relationship management software. The pig hotel lays emphasis on
providing the customers with high quality services at reasonable price which assist the hotel in
increasing their market in the new place. CRM system will assist the hotel in attracting more
customers to the hotel while expanding its branches in different countries.
The pig hotel in order to grow its business in the new country must implement CRM
system which assist the firm in increasing their market share by building a strong relationship
with the customers over there. CRM with the help of its marketing strategies can assist the Pig
hotel in expanding its business over there.
Customer relationship management strategies are developed to retain the existing
customer and attract the potential customers toward the hotel. CRM system helps the
organisation in identifying which customers are profitable to the hotel in order to provide them
more attention. Realignment of asset to meet the customer demand means that the objective of
the organisation must be link with meeting the customers need. It is related to using the
resources of the firm in order to meet the customers demand better. These resources include
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identification of various customers demand in order to design the product according their needs.
The pig hotel ensure that the products and services delivered to the customers contains high
quality in order to satisfy their customers.
The pig hotel provide customers to give their feedback and review in order to improve
their product defects. This assist the hotel in improving their facilities to attract more customers
towards the firm. CRM model is designed in order to identify various needs of their customers
in order to meet their expectation by fulfilling their demands. IDIC model is implemented by the
pig hotel in order to find out their target customers and gather data relating to their needs and
desire. This assist the firm in effectively achieving their goals in the new market. Facts and
statistics relating to the implementation of CRM in the Pig hotel contain that the sales will be
increased by adopting the CRM system in the establishment. CRM software helps in cutting the
cost and assist in reducing market cost by 23%. CRM is basically used to improve the customer
service in order to retain their existing customers and attract new customers towards the brand.
CRM is used for different aspects such as 47% or CRM users want to increase their customer
service management, 42% want it for marketing automation and 39% for social media
monitoring. The Pig hotel by implementing the CRM model will increase their customer service
and also help the organisation in building the trust and loyalty among the customers (Kumar and
Reinartz, 2018). IDIC model of customer management support the Pig hotel in developing the
new products and services according to the demand of the customers. The pig Hotel must ensue
that the branches of the hotel which are expected to open near Canterbury in Kent, one near
historic Arundel in west Sussex and the last one which going to open near foodie haven of
Padstow in Cornwall have proper CRM implementation in order to know about their customer
purchasing habits and their expectation regarding the services form the hotel. The pig hotel have
to make available better infrastructure facilities, accommodation facilities. High quality room
services and High quality food services to its customers.
CONCLUSION
From the above study it has concluded about the customer relationship management
which had been used to provide customers with high quality services and meet their expectation
regarding various products and services delivered by the hotel sector. This study has also
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explained about the CRM model which had been implemented in the Hotel industry to identify
their potential customer's. Furthermore, This study has explained about various CRM software
which are used in order to record about their customer data. Moreover, this assignment has
provided with the various components of the CRM model which assisted the hotel in improving
their connection with the customers.
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REFERENCES
Books and Journals
Aryee, S. and et.al., 2015. Proactive customer service performance: Test of a team-level model.
In Academy of Management Proceedings (Vol. 2015, No. 1, p. 11002). Briarcliff
Manor. NY 10510: Academy of Management.
Aryee, S.and et.al., 2017. Customer Service Performance: An Application of the Job Demands-
Resources Model. In Academy of Management Proceedings (Vol. 2017, No. 1, p.
11010). Briarcliff Manor. NY 10510: Academy of Management.
Chathoth, P. and et.al., 2016. Co-creation and higher order customer engagement in hospitality
and tourism services: A critical review. International Journal of Contemporary
Hospitality Management. 28(2). pp. 222-245.
Cook, S., 2017. Measuring customer service effectiveness. Routledge.
Dhar, R.L., 2015. Service quality and the training of employees: The mediating role of
organizational commitment. Tourism Managemen. 46. pp.419-430.
Glennon, R.J. And et.al., 2016. Locating customer value in contracting-out decisions in English
local authorities.
Gursoy, D., Cai, R. and Anaya, G.J., 2017. Developing a typology of disruptive customer
behaviors: Influence of customer misbehavior on service experience of by-standing
customers. International Journal of Contemporary Hospitality Management. 29(9).
pp.2341-2360.
Kandampully, J., Zhang, T. and Bilgihan, A., 2015. Customer loyalty: a review and future
directions with a special focus on the hospitality industry. International Journal of
Contemporary Hospitality Management. 27(3). pp. 379-414.
Kumar, V. and Reinartz, W., 2018. Customer relationship management: Concept, strategy, and
tools. Springer.
Shin, H. and et.al., 2017. Employing proactive interaction for service failure prevention to
improve customer service experiences. Journal of Service Theory and Practice. 27(1).
pp.164-186.
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