CRM in Travel/Hospitality: Vertical Markets Spotlight
You’d be hard-pressed to find an industry vertical hit harder by the COVID-19 pandemic than travel/hospitality. And now that the worst of the crisis seems to be behind us, it’s the industry benefiting the most from people’s bottled-up desires to do the things they were denied during the lockdowns.
But as business starts to return, companies in these industries will rely heavily on their CRM systems for two major challenges: growing customer loyalty and improving customer satisfaction.
CRM to boost guest loyalty and personalize guest interactions can improve overall conversion rates by 50 percent through marketing automation, increase email conversion rates threefold, and improve click rates by 41 percent, says Mark Bedard, senior manager of product marketing at Amadeus, in the hotel technology provider’s blog.
Though occupancy levels are high thanks to pent-up demand, the hotel industry remains under intense pressure to grow wallet share through the promotion of dining, spa, and other services.
“You cannot have a meaningful repeat business (which is as much as 15 times cheaper than acquiring new guests) without a CRM technology and program in place,” Max Starkov, an online travel tech consultant and strategist, says in a 4Hoteliers blog. “Only a meaningful CRM technology application as part of your hotel tech stack can ensure deep engagement with your past and future guests.”
Starkov adds that CRM can provide automated communications before, during, and after stays; guest satisfaction surveys; guest retention marketing automation; and drip marketing campaigns. But CRM can really take it a step further, he says, via guest recognition program management and loyalty marketing.
Hospitality and travel firms rely on this technology to, among other things, maintain and grow market share and profitability, enhance personalization, communicate with customers, manage assets, and accommodate luxury travelers.
Capterra lists Pipedrive, Monday Sales, NetSuite, Hubspot, Zoho, Quickbase, Salesforce, Maxmizer CRM, Act!, and Less Annoying CRM as the top hotel CRM systems. Capterra lists WeTravel, Lemax, TravelPerk, Rezdy TravelWorks, Exus, Softrip, and Travefy Agent as the top CRM systems for travel agents.
In addition to the systems above, other CRM system providers specifically cater to the travel/hospitality industry. Starkov cites Cendyn CRM, Revinate CRM, Amadeus GMS, and a few smaller CRM systems designed for specific niches.
With the emergence of Airbnb and other independent hospitality providers, technologies offering property management capabilities are also becoming more popular.
But building loyalty is among the most pressing needs, particularly as the pending economic slowdown will again pose strong market challenges.
“For travel and hospitality brands, presenting truly personalized content to both potential bookers and loyalty members has been a long-held goal,” says Ed Silver, chief information officer of iSeatz, a provider of digital commerce and loyalty tech solutions that enable travel and lifestyle bookings. “With the amount of detailed information that these brands have access to, they would be in an ideal position to deploy detailed content and recommendations.”
According to a McKinsey report that examined the issue, companies excelling in personalization can generate 40 percent more revenue than their average, non-personalizing competitors.
And in a 2023 iSeatz report on travel loyalty, 70 percent of consumers who receive dynamic, personalized recommendations on booking platforms find their programs to be valuable, but only 48 percent actually receive personalized emails from their travel loyalty programs. This indicates that the booking platforms have better integration of their CRM systems with other customer-related technologies, including booking engines and loyalty platforms, according to Silver.
“Travel brands need to start marketing more like retailers and invest in the technological capabilities necessary to integrate their CRM and [customer data platforms] with their booking sites and loyalty programs. Only then will they be able to achieve real personalization and give their customers and loyalty members the experiences they want and are willing to pay for,” he says.
To offer better integration of sales and marketing efforts, in March Cendyn launched eInsight Sales, a B2B sales automation solution available as a hospitality-centric add-on to Cendyn’s eInsight CRM platform. The sales and CRM solutions provide sales and marketing teams integrated technology for generating demand, building pipelines, enhancing guest satisfaction, and driving loyalty.
Using the same data as eInsight CRM, eInsight Sales enables hoteliers to correlate guest profile, reservation, and other data with corporate accounts and travel agent data to determine where demand lies, learn more about feeder markets, and pinpoint opportunities and gaps across their sales and marketing strategies, according to Michael Bennett, Cendyn’s president and chief marketing officer. “By adding sales automation to our CRM, customers will benefit from more business won, reliable reporting and deal forecasting, increased customer satisfaction, and an efficient use of resources.”
SMALLER BUSINESSES, BIGGER NEEDS
While major hotel chains and travel companies have large on-site teams of employees and contact centers, the vacation rental business has no such amenities. For them, specialized CRM systems that also include property management functionality is key, according to Steve Schwab, CEO and founder of Casago, a vacation rentals and property management software provider.
“By customizing the software to meet specific needs and automating core functions, daily operations can be streamlined, and the bottom line can be boosted,” Schwab says. “However, an all-in-one vacation rental software that combines the power of the PMS with additional features for property managers, homeowners, and guests is even more powerful.”
Systems can incorporate dynamic pricing software, which adjusts rates based on historical insights and real-time data. A channel manager connects to travel agency and niche booking sites, automates listings, syncs calendars, and prevents double bookings, Schwab says. “Effective communication is key to a positive guest experience, and a vacation rental CRM tool automates guest and owner communication, optimizing lead management and maximizing efficiency.”
However, Dustin Abney, CEO of Portoro, a property management company for premium vacation rental homes in top-tier destinations, says CRM programs designed for vacation rentals still need more customization due to the differences in ownership, the types of properties, and other unique challenges.
“Asset types do vary dramatically and have significant impact on CRM requirements and down-line operational effects,” Abney explains. “The down-line effects of these unique assets is that each property must be taken care of differently. The number and type of tasks required and the triggering events to complete those tasks or change those tasks becomes very complex. There is simply not enough customization.”
Starkov adds that only 10 percent of independent hotels have implemented CRM programs.
“CRM is paramount to the success of any travel company,” says Robert Harrington, the U.S. manager of SamBoat, which positions itself as the “Airbnb of boating.”
The company uses CRM to track the boats listed on its website and to manage customer leads for those who rent the boats on the SamBoat platform. The company’s needs are pretty specific, according to Harrington. “We need to visualize where our boat fleet is coming from and where our customers are requesting those boats. If we’ve got a whole lot of boat rental requests coming in for Boston, but don’t have an adequate number of boats, CRM technology can help us visualize that issue and then we can fix the problem.”
SamBoat has customers requesting boats worwide, Harrington adds. “It’s important for us to be able to log our client information as we work on each and every single lead. Why did we lose a specific deal? What size is the boat that we just rented? In what city was the boat rented? Was it a day charter or a weeklong charter? All of those questions are paramount to the success of our business, and we’ve been able to log all that information within the CRM system we utilize. Not only does it help the sales process in the short term, but it helps us in the long run as well.”
Harrington added: “My life has been made a lot easier via the utilization of CRM. I’ve got a lot on my plate and need quick answers for upper management, which I would not be able to provide without the help of a CRM.”
Another unique challenge in the hospitality industry is the wide divergence among customers. Some travelers look for bargains, including low-cost airfares and no-frills rooms, while other travelers want luxury, five-star experiences.
To cater to the unique needs of the latter, TProfile, which provides CRM technology and customer experience technologies for the travel industry, in March partnered with Stewart Travel Group to launch Destinology Tailor-Made Holidays, a luxury travel service. The Destinology website provides content from global luxury travel partners, and personal travel consultants offer tailor-made itineraries.
“We are able to provide Destinology with detailed content and real-time information for this exciting new bespoke service,” said Bhav Taylor, TProfile head of sales, in a prepared statement. “Destinology customers will receive a high level of detailed information throughout the booking process for an exceptional five-star experience.”
CRM systems will continue to evolve, and vendors like TProfile will continue to add features to meet the unique needs of the industry. But while the travel/hospitality industry is a hotbed of activity for CRM vendors, it is still wide open. As of mid-2022, only about 20 percent of hotels worldwide, representing an estimated 32 percent of hotel-room supply, were using any CRM tool, according to the Skift Research Hotel Tech Benchmark. So there is huge room for growth.
Phillip Britt is a freelance writer based in the Chicago area. He can be reached at email@example.com.