Marketing and Customer Retention in the Hospitality Industry

This essay discusses the use of marketing mix in strategies of the organization, analysis of characteristics of the organization's relationship marketing program, and proposed strategies for developing a loyalty program in the hospitality industry.

Marketing and
Customer Retention in
the Hospitality Industry

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Use of marketing mix in strategies of the organisation...........................................................1
2. Analysis of characteristics of organisation's relationship marketing programme and
explanation of the success and failure as a customer retention tool with reasons.......................3
3. Proposed strategies for the development of own loyalty programme in the business within
the hospitality industry.................................................................................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Marketing and customer retention are two different types of elements that are interlinked
with each other because with the help of them an entity can reach to the long term goals and
objectives of business. The process which is followed by the businesses for the purpose of
promoting all the products and services is known as marketing. On the other hand, customer
retention could be described as ability of an enterprise to retain the clients for long run by
satisfying all their needs (Lopes 2016). The organisation which is selected for this essay is Savoy
Hotel which is operating under hospitality industry and established in Strand, London, United
Kingdom. This essay covers various topics such as use of marketing mix in the marketing
strategies, characteristics of relationship marketing programme and explanation of success or
failure as a customer retention tool with reasons. Apart from this, proposed strategies for their
development of own loyalty programme are also covered in the discussion.
MAIN BODY
1. Use of marketing mix in strategies of the organisation
Marketing strategies could be described as different types of ways that are used by
businesses for the purpose of promoting all the products and services and retain the customers
for long run. Savoy is one of the largest hotels which is operating in London and different
locations around the world (Jalilvand 2017). While formulating strategies for developing
customer loyalty programme the entity pays attention towards all the elements of marketing mix.
Discussion of them is as follows:
Product: It could be defined as the offerings that are made by an organisation to all the
clients for meeting their expectation level. All the services that are offered by Savoy Hotel are
considered as its products. Some of them are beauty and fitness, butler services, flowers, tea shop
etc. The main goals of the organisation is to retain all the customers by providing them such
services that can provide them satisfaction. While developing marketing strategy it is also
focused by the enterprise so that it can enhance client retention.
Price: The amount which is set by the entities for all their products or services that will
be sold to clients is known as price (Bahri-Ammari and Bilgihan 2019). Savoy is one of the
largest hotels of London which is using premium pricing as the services that are offered by it are
premium and it also pays attention towards quality. By considering this element in marketing
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strategy the entity portrays a positive image in the market and attract large number of customers
from various locations.
Place: The location from where the products and services could be bought by the
customers is known as place. Savoy Hotel is operating in different locations world wide and all
the hotels of it are easy to reach as it provides proper assistance and accurate instructions to the
customers who have booked the hotel. While formulating marketing strategy for hotel the
organisation makes sure that it chooses such location which is easily accessible for the customers
so that hotel could be marketed properly (Boateng 2019).
Promotion: While planning to establish a positive market image of the enterprise in
mind of customers the entities pay attention towards promotion strategy. In Savoy Hotel the
marketers are using different ways to promote the organisation. It is providing discount on the
rooms and suits that are offered by it. Apart from it, if a family is booking rooms for staying in it
then the hotel is providing them 50% of for the booking of second room (Promotion strategy of
Savoy Hotel, 2020). With the help of these ways effective marketing strategy is formulated by
the entity to retain its clients.
People: All the individuals who are working within the organisation are considered as
people and businesses are reliant on them. In Savoy the management teams are focused with
higher engagement of all the staff members. Apart from this, proper training and development
programs are also conducted within the organisation so that staff could be trained to resolve all
the issues and queries of the guests. While formulating marketing strategy it is also focused
because when the customers will be treated properly by staff then it will result in positive views
of them for the hotel and its services which will result in customer retention.
Process: Under this element of marketing mix the whole process of delivering the
products or services to the clients is focused. At Savoy Hotel, the customers can book their
rooms online as well as offline. In both types of booking they have to visit reception and ask for
the room. Afterwards, they have to make payment or show the details of online payment and
then hotel staff take them to the room which is booked by them. The whole procedure is focused
by the managers as well as other employees so that they can resolve all the queries of guests and
fulfil all their requirements (Lu and Kandampully 2016). Marketing strategy formulation
procedure also takes this element in consideration as it helps to make sure that all the customers
get satisfied with the services.
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Physical evidence: All the services that are offered by an enterprise include some
physical evidence. In other words, it could be described as everything which is analysed by the
clients while interacting with business. The infrastructure of Savoy, the environment, polite
behaviour of the staff members etc. are some of the physical evidences that are focused by the
hotel. In order to develop the marketing strategy this element is also considered by the marketers
of Savoy as it helps them to make sure that customers share positive experience with their friends
and family regarding hotel (Rosli and Nayan 2020).
2. Analysis of characteristics of organisation's relationship marketing programme and
explanation of the success and failure as a customer retention tool with reasons
Relationship marketing could be described as the process which is focused for the
purpose of maintaining good relations with clients and win their loyalty so that they can remain
engaged in the business. In order to achieve the goal of increased number of brand loyal
customers all the companies from different sectors like hospitality, retail etc. conduct
relationship marketing or customer loyalty programme. Savoy Hotel is one of the prestigious
hotels of London and the program which is developed by it for managing loyalty of customers is
Fairmont's President Club. With the help of it, the hotel tries to retain the guests who are visiting
the hotel for long term. It is a type of reward program which is also considered as a marketing
strategy which is focused with providing rewards to the loyal customers who always remain
engaged with the brand. It results in increased engagement of guests with the hotel as it inspires
them to be loyal with it because the rewards that are provided by it are very attractive and
motivating. Main aim of the enterprise for developing this program is to make more money by
keeping the existing customers and inspiring others to get engaged. It facilitate the enterprise to
increase word of mouth, customer referrals and social proof. There are various characteristics of
this programme which could be understood with the help of following discussion:
 All the members who are part of the Fairmont's President Club receive complimentary
high speed internet at the hotel which helps them to stay loyal towards the brand.
 The members of the club receive savings of 10% on Willow Stream Spa treatments and
products (Allan 2016).
 One of the main characteristics of the loyalty program is that it is highly focused with
enhancement in customer engagement that facilitate the hotel to meet all its long term
goals such as increased number of guests and highly loyal clients.
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 The loyalty program of Savoy Hotel is highly flexible as the benefits that are provided to
the club members are valid for all the branches of it whether customers is visiting a
London Hotel or any other subsidiary of it in world. It helps the guests to be engaged
with it as they are receiving such benefits.
 The relationship marketing program of Savoy Hotel stimulates participation of customers
and influence the way in which that are attracted to the program over time that benefits
hotel to maintain loyalty of guests (Rather and Sharma 2019).
The relationship marketing or customer loyalty programme of Savoy Hotel is very
effective and it was focused with enhancement of customer engagement. It resulted positively
and attained success for the organisation because it resulted in increased brand loyal customers
who are highly engaged in the brand. The main feature of the Fairmont's President Club is that it
provides all the benefits for all the branches of it so that clients can get the facilities in different
locations around the world. It was the main reason for success of the program. It worked as
customer retention tool for the organisation because with the help of it, the hotel engaged the
guests in the business and tried to keep them loyal towards the entity. Apart from this, one of the
reasons for success of the program which was organised by the organisation was the main goal of
it. It was increasing interest of visitors and retaining them for long run by providing additional
and attractive benefits (Park 2019).
3. Proposed strategies for the development of own loyalty programme in the business within the
hospitality industry
Marketing is one of the main element which is required to be focused by all the
businesses as it can help them to reach all the desired goals in future. Savoy Hotel is one of the
largest hospitality organisations of London which is providing premium services to the
customers. There are various types of marketing mix elements that are focused by the entity for
developing marketing strategy so that it can gain attention of customers. These are product,
price, place, promotion, people, process and physical evidence. With the help of all of them
effective marketing strategy is developed by the hotel that facilitate it to aware all the targeted
audiences about all the services that are offered by it. The relationship marketing programme
which is developed by it is Fairmont's President Club (Yang, Min, and Garza-Baker 2019). It is
highly focused with enhancement of customer engagement that facilitate it to increase their
loyalty towards brand. After completion of LMU BA Top Up Hospitality Management Course
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when an individuals will develop loyalty programme for own business then following strategies
could be focused:
Providing reward points to all the customers: While developing programme in future
the loyal customers could be rewarded with points which could be redeemed by them when they
will visit the hotel again in future. Apart from this, under this strategy they will also be allowed
to use those points to get discount on the services that are used by them. With the help of it, they
could be retained for long term (Xing and Syriac 2019).
Flexibility to use additional services: When the loyalty programme will be developed in
future for the business then one of the main strategy which will be focused is providing
flexibility to the clients. Under this strategy, all of them will be allowed to use benefits in
different locations wherever the business is established. It will be beneficial for enhancing their
engagement in business (Rhou and Singal 2020).
CONCLUSION
From the above project report it has been concluded that customer retention is the
procedure which is required to be focused by all the businesses for the making sure that all the
clients are engaged with brand or not. For this purpose, marketing is required to be focused and
in order to develop effective marketing strategy all the elements of marketing mix could be used.
These are product, price, place, promotion, process, people and physical evidence. Relationship
marketing or customer loyalty programmes are developed by businesses as client retention tool.
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REFERENCES
Books and Journals:
Allan, M. M., 2016. The Relationship Between Service Quality and Customer Satisfaction and
Retention in Ghana's Luxury Hotels. IUP Journal of Marketing Management. 15(4).
Bahri-Ammari, N. and Bilgihan, A., 2019. Customer retention to mobile telecommunication
service providers: the roles of perceived justice and customer loyalty program.
International Journal of Mobile Communications. 17(1). pp.82-107.
Boateng, S. L., 2019. Online relationship marketing and customer loyalty: a signaling theory
perspective. International Journal of Bank Marketing.
Jalilvand, M. R., 2017. The effect of innovativeness and customer-oriented systems on
performance in the hotel industry of Iran. Journal of Science and Technology Policy
Management.
Lopes, M., 2016. The hospitality industry (Doctoral dissertation).
Lu, C. and Kandampully, J., 2016. What drives customers to use access-based sharing options in
the hospitality industry?. Research in Hospitality Management. 6(2). pp.119-126.
Park, Y. J., 2019. An Empirical Study on the Effect of Customer Satisfaction and Customer
delight on Customer Loyalty; Focusing on Repurchase and Customer Retention.
Journal of the Korea Industrial Information Systems Research. 24(1). pp.109-123.
Rather, R. A. and Sharma, J., 2019. Dimensionality and consequences of customer engagement:
a social exchange perspective. Vision. 23(3). pp.255-266.
Rhou, Y. and Singal, M., 2020. A review of the business case for CSR in the hospitality industry.
international Journal of Hospitality Management. 84. p.102330.
Rosli, N. and Nayan, S. M., 2020. Why Customer First?. Journal of Undergraduate Social
Science and Technology. 2(2).
Xing, L. and Syriac, N. D., 2019. The Influence of Customer Relationship Management on
Customer Retention in the Insurance Sector, Malaysia. INTI JOURNAL. 2019(47).
Yang, K., Min, J. H. and Garza-Baker, K., 2019. Post-stay email marketing implications for the
hotel industry: Role of email features, attitude, revisit intention and leisure involvement
level. Journal of Vacation Marketing. 25(4). pp.405-417.
Online
Promotion strategy of Savoy Hotel. 2020. [Online]. Available through:
<https://www.thesavoylondon.com/>
Customer loyalty programme of Savoy Hotel. 2020. [Online]. Available through:
<https://theluxurytravelexpert.com/2016/09/26/best-hotel-loyalty-programs/>
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