Customer Service Management for Tourism and Hospitality Assignment (pdf)

Customer Service Management
for Tourism and Hospitality

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Different components of CRM Model to build relationship with customers.........................1
TASK 2............................................................................................................................................4
Values created by CRM Model..............................................................................................4
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
In the tourism and hospitality industry, failure and success of business, depends on
services that they are provided to customers (So and et. al., 2016). Present report covers areas
related to management of customer service operations, analyse its effectiveness in tourism or
hospitality industries, managing the resolution of queries and complaints of consumers etc. In
order to deliver higher level of customer service, this assignment will explore its fundamentals in
context of tourism environment globally. For this assistance, report is divided into two main
tasks, under which first part covers the components of CRM and second part defines how it
creates value for hotels and their customers. The Pig Hotels of UK is taken which includes a
collection of small lifestyle hotels and restaurants. By using concept of CRM model, employers
of this hotel seek to expand its litter with three new openings over next two years.
TASK 1
Different components of CRM Model to build relationship with customers
“Customer Relationship Management” is a tool that is used for communicating choices
and preferences of customers to its sales department. Thus, it should be managed by companies
so that better services and facilities can be provided to its consumers in order to maintain
customer relationship. Most of the companies are using typical CRM software for tracking needs
and wants of customers (Zhou and et. al., 2014). In hospitality sectors like Pig Hotels, there is a
high level of competition exists in the marketplace where each organisation seeks to augment its
level of relationship with customers in high manner. In this regard, low level of switching costs
and high degree of substitution assist hotel to develop an effective atmosphere of customer
relations. Along with this, to achieve success and gain competitive advantage, firm must find
ways to give best services to customers and exceed their level of satisfaction. One of the critical
factors under achievement of business objectives and success, is process to create relationships
with customers. Therefore, with this assistance, it is necessary for such hotels to develop an
CRM model in order to compete intense competition at marketplace.
In context with Pig Hotels, it includes a chain of small lifestyle hotels and restaurants.
Currently it wants to expand business market in upcoming three years by launching three more
hotels on different-different locations. Thus, to achieve this objective, its managers have
developed a CRM model to develop and manage interaction with potential and existing
1

customers. This model is based upon value chain which creates a bridge between IT and
marketing. It was developed by Michael Porter which suggest that using this model, hotel and
tourism industries can build, manage and retain long term relationship with their customers (Van
der Wagen and White, 2018). It helps in identifying all processes and actions which are involved
in obtaining desired outputs from inputs. These outcomes are then offered to those customers
who are at the end of line of value chain. In this regard, willingness of customers to acquire a
particular product or service is termed as business value. Therefore, revenue for organisation is
calculated as total value less than cost which has incurred by providing best services to
customers.
There are several components of Customer Relationship Management and these are
explained below for better understanding:
 Sales Force Automation: This is the component which is taken by most of the
companies as it enables them in knowing forecasting, recording and processing sales as
well. Other than this, it also helps company in keeping a track of important interactions.
 Human Resource Management: This department ensures that whether all skills and
knowledge are according to the requirements or it is used as per the job profiles. Main
purpose of HRM is to hire and select employees who are eligible enough for performing
the task in a better manner without having any kind of problems. As a result, it will aid
company in achieving targets and objectives in a specific time period.
 Lead Management: This majorly keep records of sales and distribution as well.
Company gains most of the profits through sales, marketing and customer executive.
Basically, it includes efficient management such as designing, campaigns, listing and
other factors.
Components of CRM are mainly linked or can be said associated with various elements
and this mainly includes acquisition, customer retention and enhanced consumer value (Ali and
Amin, 2014). Different kinds of marketing application tend to attract a large number of
customers whereas other analytical tools and data warehousing assist them in sustaining the
loyalty of consumers with having better and effective communication system. According to
importance of viewing CRM as a business strategies, there are ample numbers of data
warehousing tool and analytical tools through which company can try to improve customer value
amongst future and existing customers. Henceforth, it can be said that Customer Relationship
2

Management plays a crucial role for improving the working structure of a company and it also
assist firms in managing response of consumers in relation to products and services they are
providing.
Examples of good practice within the Hotel sector:
It has been analysed that there are ample number of hotels present in all over the world
who have different strategies to improve customer relations (Ye and et. al., 2014). It has also
been found that developed strategies have also helped hotels in improving consumer loyalty as
well at the same time. Some of the good practice carried out by hotel industries are given beneath
as:  Westin Prince Hotel : A chain of hotel which believes in revising their policies every
quarter by taking feedbacks from customers about any sort of disabilities. For an
instance, Hazel Tan Hotel have worked with Autism Ontario to revise policies to respond
to the needs of guests with Autism and as a result have received repeat visitors and very
positive feedback from ample number of patrons.
 Cambridge Hotel & Conference Center : This hotel have also developed a good practice
which can be considered here as example. As they have developed a written policy in
each department so new and existing staff know what to do when related to needs and
requirements of guests who are physically challenged. Manager of this hotel have kept its
focus on their own weaknesses and strengths which aid in finding the gap that needs to be
filled for delivering better experience to customers.
Henceforth, these are some good examples of good practice which has helped business
hotels in reaching to new heights in short period of time.
From the above discussion, it has been evaluated that satisfaction of customers plays an
extremely crucial role within a business. It is taken as feedback of consumers who paid amount
for acquiring a product or service. So, it determines success as well as converts into profit for the
organisations. In context with service based industries like tourism, hotels or transport industries,
success of their businesses is totally thrive on customer relations instead of quality of their
services or products alone. Therefore, it is crucially important for hotels and tourism industries to
create and maintain a loyal customer base to win competitive advantage at marketplace.
According to Riley (2014), in hotel and tourism sector, CRM is not just a core customer services
such as quality, pricing or delivery that services; it is also referred as friendly or problem-solving
3

approach as well as the flexibility in options which make a large difference. It helps in exceeding
the customer satisfaction which gives a company an edge over others because it enhances their
perceived value towards products of hotel industries. Therefore, CRM is essential for all
organisations especially tourism and hospitality sector as it helps in exceeding their customers’
expectations by enhancing core value of products or services.
TASK 2
Values created by CRM Model
Customer Relationship Management (CRM) includes various components and
approaches that help in building a comprehensive database which contains all the information
pertaining to targeted customers. In addition to this, it also facilitates long term growth of a
company by forming strong connection with consumers. CRM is considered as a business
approach which gives support to industries in conducting the processes related to sales,
marketing and service, for maximizing profit margins. In hotel industries, this customer-centric
approach has pioneer importance because it helps in retaining customers as well as building long
partnership with them also (Maggon and Chaudhry, 2015). As per present case study which is
based on The Pig Hotels consists a long chain of small hotels and restaurants, CRM model give
support to its employers in creating value of its services. Small lifestyle hotels and restaurants
which are connected with this hotel lie within two major groups – Lime Wood Group and Home
Grown Hotels. All of these are focusing more on authenticity and informality of design, food and
service. In order to gain high profitability and large market share, Pig hotel group wants to
expand its litter with three new openings within upcoming two years.
CRM Value Chain Model includes a set of strategies which assists The Pig Hotels to
follow while developing their CRM strategies. In other words, this model refers to a tool for
managing customer relationship with the support of people associated with business, information
technologies, portfolio or personal data of consumers and more (Tsai and et. al., 2015). Today,
most organisations in hospitality sector, work on the principle of CRM because it aids them to
deliver high value to customer as well as creates and manages the relationship of customers with
its business in a more adequate manner. Therefore, five primary steps for long-lasting
relationship with customers as per this model of value chain strategy are- Customer Portfolio
Analysis; Customer Intimacy; Network Development; Value Proposition Development;
4

Managing the Relationship. While supporting conditions for fulfilment value of this chain model
are- Culture and Leadership; Procurement Processes; Human Resource Management process and
IT/Data management procedures. Therefore, by developing this model, employers of The Pig
Hotels can achieve its objectives i.e. expansion of business in other locations within next two
years.
Therefore, five primary stages for implementing CRM value are stated below:
Customer Portfolio analysis: This is determined as the first thing which is to be
performed by company so as to identify customers and their needs because consumers are the
one who create values for the organisation. Therefore, in this stage, company analyse choices
and preferences of customers (CRM Models, 2018). As a result, it assist firm in making
strategies so that they can connect with customers more effectively. In this regard, through
customer portfolio analysis, managers of The Pig Hotels can identify demand and purchasing
power of each guest. By this process, they can develop strategies to fulfil their demand and get
retention for long period.
Customer intimacy: It is the second stage under which company has enough information
about customers in hand. This is the time when firm can generally interact or connect with
customers or the ones who are most valuable for the organisation. Knowing them better will
definitely assist managers of The Pig Hotels in providing effective services and facilities.
Illustration 1: Primary Stages of CRM value
(Source: Primary Stages of CRM value, 2018)
5

Network development: Network position of a company reflects the business connection
of a company with its distributors, suppliers and all associated persons, who give their
cooperation in delivering the value to targeted customers. It is considered as a source to gain
competitive advantage. Therefore, for developing relationships with customers, it is essential for
The Pig Hotels and other tourism organisations to create value for their customers at every stage
of delivering services. In this regard, companies are required to create a strong network for its
consumers to serve profitably (Zaitseva, Goncharova and Androsenko, 2016). It includes
investors, suppliers, distributors, employees, technology and retailers.
Value Proposition Development: It is considered as fourth step of CRM value chain,
where network plays an important role in serving and building the effective relationship with
customers. Further, network develop by hotel industries like The Piglet Hotel help in creating a
value proposition. In addition to this, each associated member in a developed network works
with each together for creating value for customers.
Managing the Relationship: It is the final step of developing CRM model where
completing above mentioned stages aids a company in creating the relationship with customers.
Further, it is essential for such companies to manage and keep these relationships so that targeted
customers, investors, business partners and all associated people will get value for the long term
(Horner and Swarbrooke, 2016).
Benefits of implementing CRM strategies Enhance Sales Productivity: One of the main benefits Pig Hotel has got by
implementing CRM strategies is improving and enhancing sales productivity. With the
help of customer portfolio, this hotel can determine demand of each guests. Through this
process, they can strategies to make connection with targeted audience and influence the
to take services. In this regard, repetitive sales tasks such as sending e-mails, generating
reports in automated manner, retention of customers and more are some current and
future benefits as a company get through strategies of customer relationship management. Customer Retention: Due to presence of many hotels at same place, any product
dissatisfaction tends to move away customers from one company to another. The other
main reason for this is lack of personal relationship between company and its customers.
Therefore, through customer portfolio analysis, The Pig Hotels can get opportunity to
understand its customers and way to develop long lasting relationship with them. It will
6

help in getting retention of loyal customers for longer period (Torres, Fu and Lehto,
2014). Wining Strategies: CRM models help in developing strategies such as cross-selling
which involves providing customers services that augment original purchase as well as
develop their interest in acquiring services of hotels. It also includes offering addition or
upgraded services, like sightseeing packages which come under the category of up
selling. In addition to this, CRM strategies also provide numerous benefits such as a two-
day all-inclusive package on discounted rates for loyal and dedicated customers.
Therefore, all such schemes help in increasing the sales through which The Pig Hotels
can generate better revenues to achieve its objectives and goals in given period of time. Customisation: CRM software also allows The Pig Hotels and other industries to
customize their products according to preference of targeted audience. They can
customise products as per need of certain customers such as value for money is
considered as main priority while for many others luxury as well as overall experience
matter the most.
 Better Customer Support: Stages in CRM model like customer portfolio, intimacy, value
proposition development, helps Pig Hotel in determining the demand of every guests. It
aid managers in building an effective customer support system which provides assistance
to develop connection with clients by phone, chat, e-mail and more (Bowie, Buttle,
Brookes and Mariussen, 2016).
Good Practice:
In present context of The Pig Hotels where role playing acts are being performed among
staff so that to they gets trained related to setting priorities depending on the needs of clients.
This is being considered as one of the main and best sort of training tool that has helped staff
members in building relationships with customers. Hotel do not believes in offering theoretical
training to its employees and puts different sort of situations where they can understand how to
deal with demand of customers.
In present context, managers of Pig Hotel have developed good practice considering their
vendors as great resources in keeping up-to-date on the most technological advances for
accessibility (Manhas and Tukamushaba, 2015). This hotel has a good relationship with its
suppliers, who give options and advice to make a decision regarding accessible upgrades. An
7

instance is being taken to understand this sort of good practice where, many people who have
low vision are not blind; they can see contrasting colors and images. Hotel working with number
of suppliers to contrast their towels at the hotel to make things easier for people to see. In
addition to this, CRM software creates a coherent and cohesive body of information which drives
the value proposition for a given client also. As it provides opportunities to craft and execute
unique sales strategies as per preference of customers. This software is proliferating the
landscape on which managers are required to give training to employees. It would help in
making workers familiar with new techniques and give support for improvement of sales
performance.
CRM Model also aid hotel industries include Pig Hotels in improving its poor aspects of
services. For example: If company take more time for check-in process then customers who give
more importance to valuation of time, will tend to switch over from there. This will impact
negatively on brand image of business. Therefore, using CRM software, managers of Pig Hotels
can provide better services to its guests on time.
CONCLUSION
From this report, it has analysed that satisfaction of customers plays an important role in
growth and success of business. In context with hotel and tourism or industries, through concept
of CRM and its models, firm can exceed their customers’ expectations by increasing the
aesthetic value of their services and giving opportunity for building effective interpersonal
relations with clients. By developing CRM model, organisation can deal in hotels and tourism
industries getting various opportunities to generate profitability. It includes interaction and
retention of loyal customers, enhance sales performance, improve productivity of workplace etc.
It provides ways by which companies can understand what their consumers want. Therefore, on
the basis of this, such organisations can deliver them better services and exceed their level of
satisfaction as well.
8

REFERENCES
Books and Journals
So, K. K. F. and et. al., 2016. The role of customer engagement in building consumer loyalty to
tourism brands. Journal of Travel Research. 55(1). pp.64-78.
Zhou, L. and et. al., 2014. Refreshing hotel satisfaction studies by reconfiguring customer review
data. International Journal of Hospitality Management. 38. pp.1-10.
Van der Wagen, L. and White, L., 2018. Event management: For tourism, cultural, business and
sporting events. Cengage AU.
Ali, F. and Amin, M., 2014. The influence of physical environment on emotions, customer
satisfaction and behavioural intentions in Chinese resort hotel industry. Journal for
Global Business Advancement. 7(3). pp.249-266.
Ye, Q. and et. al., 2014. The influence of hotel price on perceived service quality and value in e-
tourism: An empirical investigation based on online traveler reviews. Journal of
Hospitality & Tourism Research. 38(1). pp.23-39.
Riley, M., 2014. Human resource management in the hospitality and tourism industry.
Routledge.
Maggon, M. and Chaudhry, H., 2015. Revisiting relationship marketing and customer
relationship management in leading tourism and hospitality journals: research trends
from 2001 to 2013. Journal of Relationship Marketing. 14(1). pp.53-77.
Tsai, C. Y. and et. al., 2015. Work environment and atmosphere: The role of organizational
support in the creativity performance of tourism and hospitality organizations.
International Journal of Hospitality Management. 46. pp.26-35.
Zaitseva, N. A., Goncharova, I. V. and Androsenko, M. E., 2016. Necessity of changes in the
system of hospitality industry and tourism training in terms of import substitution.
International Journal of Economics and Financial Issues. 6(1). pp.288-293.
Bowie, D., Buttle, F., Brookes, M. and Mariussen, A., 2016. Hospitality marketing. Routledge.
Manhas, P. S. and Tukamushaba, E. K., 2015. Understanding service experience and its impact
on brand image in hospitality sector. International Journal of Hospitality Management.
45. pp.77-87.
Torres, E. N., Fu, X. and Lehto, X., 2014. Examining key drivers of customer delight in a hotel
experience: A cross-cultural perspective. International Journal of Hospitality
Management. 36. pp.255-262.
Horner, S. and Swarbrooke, J., 2016. Consumer behaviour in tourism. Routledge.
Online
CRM Models. 2018. [Online]. Available Through:<https://ninjaoutreach.com/crm-models/>.
9