Customer Experience in the Hotel Industry: You May Not Have Guests, But You Still Have Customers (2024)

The effects of the pandemic on the hospitality industry are gloomy, but customer experience can be a competitive advantage even if you think you don’t have a customer right now.

We’re about one year into the COVID-19 pandemic and, much like the spread of the virus, the hit to the hotel industry hasn’t slowed down. Occupancy for U.S. hotels in 2020 dropped a whopping 33.3% to just 44%, according to hotel data company STR. The hotel industry set a record for the worst performance of any year, surpassing 1 billion unsold room nights for the first time ever.

Although not surprising, the news is certainly disheartening for an industry that had previously enjoyed almost a decade of growth amid the recovery from the previous Great Recession. Today, many hoteliers may be left asking: We don’t have customers, so how can we have a customer experience? And, does it even matter?

The truth is that you do have customers, even if they’re not staying with you as often right now. Your customers are still interacting with you, whether it’s via call centers or online. Many are reaching out to update reservations or seek out other information, for instance. But, they are still your customer, and therefore customer experience in the hotel industry still matters. How you handle it now will determine whether you will still have on-property customers when travel picks back up.

Customers aren’t just heads in beds

Your customers have always interacted with you via many different channels, but the pandemic has opened up new opportunities and expanded others. Pre-pandemic, the typical process might have been that a guest would book a room online, come stay at the property, maybe have a few interactions with hotel staff, and then check out. Maybe they would then write a review or fill out an emailed post-stay survey. While this kind of feedback is still important, how can they give a clear picture of the customer experience if the volume has drastically dropped due to the lack of travel?

During the pandemic, call center and digital channels have become huge opportunities — and absolutely necessary — to get customer experience in the hotel industry right as properties sit half empty. To be clear, these channels have always been important, but the pandemic has amplified their value.

For example, let’s say a customer is trying to find information on your website about updated cleanliness standards. It’s important that the potential guest knows the procedures before booking, so they may call to find out. How that call is handled can either lead to a booking or the loss of a customer.

How you handle the customer experience now will determine whether you will still have on-property customers when travel picks back up.

Taking it one step further, you need to be able to gather insights from those calls in order to make better decisions about your business. Have 20 guests called to ask about cleanliness standards because they can’t find the information on your website? Now you know that you need to make that information more accessible in order to turn lookers into bookers. Because what happened to the 20 people who didn’t call to ask? Did they book with you, or did they go to the competitor who made it easy to find what they were looking for?

That’s why having a pulse on the call center is crucial to understanding the real value drivers. If you don’t know where to begin with your strategy, talk to your call center associates for ideas. Technology can help you to do this at scale. You’ll find that this sort of listening is not only great for the customer experience, but also for the employee experience. And, as we like to say in the hospitality industry, happy employees create happy customers.

On the digital side, it’s about meeting your customers where they are. While call centers will always be important for the customer experience, not everyone wants to pick up the phone. You need to be available for your customers across multiple channels, including web, mobile and in-app. Most importantly, the experience across these channels has to be seamless. Guests today are more connected than ever, with 75% of consumers saying they expect consistent experiences across multiple channels (web, mobile, in-person, social) and 73% likely to switch brands if they don’t get it.

Real-time feedback = Real opportunities

You’ve taken stock of your call center and digital strategies. Now what? One consistent challenge to the hotel industry is that it can offer guests an inconsistent experience. The industry is fragmented — you’ve got owners, third-party operators, and the brands whose flags you fly, so who’s making all the decisions, anyway?

The pandemic really showed hoteliers that the ability to be nimble in their operations is absolutely crucial for continued success. With lots of moving parts, such as regulations changing on a state-by-state basis and sometimes daily, it was difficult for someone at a corporate office to have all the answers. And, it wasn’t easy to wait for brands to update their standards when you had customers telling you now that they aren’t comfortable booking until all employees are masked, for example. The hotel owners and operators who were able to take real-time feedback, from both customers and frontline employees, and act on it rose to the occasion.

The lessons learned span beyond the pandemic. Your customer — and yes, you still have one, even if travel isn’t expected to fully recover for a few years — now, more than ever, expects you to keep up with their wants and needs and implement changes that cater to them. And if you don’t, they’ll go to the hotel across the street. Or, they might consider a disruptor such as Airbnb, which has weathered the pandemic relatively well compared to hotels due to its ability to adapt quickly and refocus its strategy.

You do have customers, even if they’re not staying with you as often right now.

People begin to try new brands when customer patterns are disrupted. You can either say, “Well, these guests will never be loyal customers, so what’s the point in catering to them?” Or, you can recognize the huge opportunity for retention of new customers you might not have had access to before. And, real-time feedback can help you gather insight into what this new-to-you segment wants so that you can quickly make decisions that will lead to loyalty.

In short, the COVID-19 pandemic shifted the hotel industry in ways we couldn’t have imagined a year ago. While we have always known that feedback is key to providing a customer experience that builds loyalty, the pandemic only pushed us into further realization that our business can’t survive without really listening and then acting. As the industry moves toward recovery, inaction won’t be acceptable to guests. So, now’s the time to listen to your customers at scale if you want to fill those rooms back up when travel resumes.

How you engage with your customers today will impact their booking behavior tomorrow. Interested in learning how you can demonstrate your ability to quickly respond to your customers’ needs? Learn more about Medallia for hospitality.

Customer Experience in the Hotel Industry: You May Not Have Guests, But You Still Have Customers (2024)


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