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Building better guest loyalty in 2023, with Josiah Mackenzie

 

 

Josiah Mackenzie has been a hospitality advisor for many years. Now that 2023 has begun, he and host Robin Trimingham discuss what the best strategies are for retaining guests and generating loyalty in the 2023 hospitality landscape.

For more of Josiah’s work on artificial intelligence, see his guide to AI for hotels

 

 

 

 

 

Highlights from Today’s Episode

Episode Sponsors:

This episode was supported through the generosity of the following sponsors:

Groupe GM  (groupegm.com)

For the last 50 years, Groupe GM, has been a leader in the luxury amenity industry. The Group proposes a 360 solution from manufacturing to distribution on cosmetics amenities and dry accessories. groupegm.com


 

Episode Transcript

Josiah: I experienced some of the best hospitality I’ve ever experienced. The owner came out and was talking with us and got to know us, and then he went back to the kitchen and he came out and he said, Oh, we just tried this new salad dressing. I think you’re really going to like this. And he brought us out some salads. We didn’t even order this. He was just really excited about what he was making and just provide phenomenal service. The whole evening and halfway through our dinner, I turned to my wife and I said, I have to share this with the world. So I got up my phone and left a five-star review right then and there. And it’s like, this is the example of something that you’re really delighting people. And I know that might seem like a one-off, but it would be interesting to think about in your business what’s something like that you can offer where I don’t feel harassed, I actually want to stop right now and leave a review.

 

Robin: Welcome to the Innovative Hotelier podcast by Hotels magazine with weekly thought-provoking discussions with the world’s leading hotel and hospitality innovators. Welcome to the Innovative Hotelier your podcast brought to you by Hotels magazine. I’m your host, Robin Trimingham.

 

Robin: It’s fair to say that 2022 was a year of optimism and trepidation in the hotel industry. Would the much-needed recovery occur? Would airlift be sufficient to meet traveler demand? Was the pandemic in fact really over? Now, as we embark on a new year, it’s clear where ground has been made and where there’s still work to be done. So I thought it would be a great time to bring Josiah McKenzie of HotelOperations.com back to chat with us about rebuilding hospitality using high-impact, low-cost ways to build loyalty and hopefully give everybody some actionable ideas that they can use right away. So join me now for my conversation with Josiah.

 

For the last 50 years, GroupeGM has been a leader in the luxury cosmetic amenities industry. The group proposes a 360 solution from manufacturing to distribution. With over 40 international brands in its worldwide distribution network, GroupeGM offers different shapes and sizes of eco friendly products in hotels all over the world. Discover more on www.groupegm.com.

 

Robin: Welcome, Josiah. It’s great to have you back on the show. So how is everything?

 

Josiah: It’s great. Thanks for having me back. It’s great to be here and see you again.

 

Robin: Well, we’re starting off a bright and shiny new year, as they say, and I thought that 2022 was really an uneven year in the travel sector, in the hospitality sector. So I thought we should talk about sectors where we have recovered fully to 2019 levels, maybe even exceeded them a tiny bit. And well, also where we have not and there’s still some work to be done.

 

Josiah: Certainly. The great thing about the hotel industry is we have no shortage of data. I was just looking at some data sets this morning that showed a lot of encouraging signs of recovery. As you pointed out, the recovery has not been even early in the pandemic. We saw lifestyle hotels drive to destinations quickly, pulling ahead in recovery. People wanted to go there. They wanted to spend time there and we’ve been preparing and planning for and expecting business travel to come back. One of the data sets I looked at this morning was already seeing group travel business travel at their hotels exceeding 2019 levels, which is encouraging. I think the consensus among most forecasters is that this will be the year that group travel, business travel comes back. There are some that kind of believe business travel will be off a bit of 2019. I think the former Spirit Airlines and current JetBlue board member wrote a piece about this recently saying that they expect 15% off 2019 levels. So that may happen. Others are seeing otherwise. Obviously, you have to kind of keep an eye on the numbers for your business, but overall, very encouraging to see different areas of our industry come back.

 

Robin: I appreciate that there has been a great resurgence and sometimes in surprising areas. As for some of the others, though, what do you think? Are some of them sort of clinging to a false hope that their old or original traveler mix is going to return just like it was before, say, because they’re a city centre hotel and they’ve always had business travel? Or do you think this is what I’m going to call the new normal of travel? And some of them really just need to realign the kind of travelers that they’re going to be pursuing.

 

Josiah: You can’t take anything for granted. The world is constantly changing, whether it’s coming out of a pandemic or just how things evolve. You always have to keep an eye on what’s going on in your business. What do you see happening in the market and how do you adapt and respond to that? The most successful brands I see right now are doing that. They’re finding people we talked about business, travel. Business travel may look a little bit different. Maybe it’s people gathering, maybe it’s more local companies that have a hybrid work arrangement wanting to gather people and it’s catering to that. So don’t necessarily just look at historical benchmarks. Don’t say this is the way we’ve always operated. Maybe things are different, maybe they’re not. But keep a look at the numbers, see kind of what people are booking at your property and respond accordingly.

 

Robin: Well, obviously that’s really good advice. I was thinking about what we’ve all been through, if you will, and when travel was so difficult with not being able to fly or having to wear masks more than perhaps we were comfortable with. What do you think the toll is that’s been taken on travelers as a result of all of this? Do you think the guests are looking for just a different experience and therefore maybe changing up where they would prefer to stay as a result of all that?

 

Josiah: Well, you’re right. I think some of the adjustments that we’ve had to make as travelers have sometimes been a little tough because we love travel so much. We’ll go through that. If we’re honest with ourselves, though, travel is always a little bit challenging, right? So if nothing else, from a time zone perspective, you’re waiting in line different places or you’re just sitting in an airplane a long time where you’re on the road a long time. So there’s an element of travel that’s just always been tough. I think this is what the opportunity of hospitality is, is helping people experience. Why did they go through that process, and especially for leisure travelers, help them transition in from that journey, which maybe was long, maybe it was tough into relaxing into their environment. And if you’re traveling on business, helping provide this environment where they can focus on why they’re in your city or in your neighborhood for business. So I think as humans, we’re kind of fundamentally don’t change that much. And I would encourage listeners not to overindex on kind of what has changed in the last couple of years. Think about what do we fundamentally want is people and how does hospitality provide that? I love going back to things like Maslow’s hierarchy of needs and understanding, just those timeless elements of our character and what opportunities might exist coming out of that.

 

Robin: Yeah, actually Maslow is a great example of that because that talks about personal safety being at the core of everything, which is interesting when we’re in our present conversation. I was thinking about airport properties because there’s obviously thousands, if not millions of those, and I was kind of on the fence when I was trying to decide would the typical traveler prefer them now because they were convenient or maybe on to something else where there was less people, less possible exposure to germs? I was wondering, do you think hotels really need to do more exit surveys to find out exactly who is staying at their property and why?

 

Josiah: It’s always a good idea to learn more about your guests. Surveys could be a powerful way of doing that. There’s other ways to collect data. I encourage everyone to think about how do you enhance your capabilities for understanding guests, whether it’s through a survey or through your booking process, understanding that that allows you, especially if you do a good job organizing it, collecting it, and then reusing it, you can deepen the relationship you have with your guests, increase the service for them. But absolutely, I think that’s something kind of not only airport hotels, but others could benefit from in understanding kind of what is the changing guest preference. I’ve actually stayed at a few airport hotels recently and experience some really good service from some properties that were more budget or mid-scale. And I think this really comes down to just knowing what your customer is there for in providing it and a really efficient sort of way. I think like you and probably many others, we kind of look for the interesting maybe boutique lifestyle concepts that are doing very, very creative things. But I also have a deep appreciation for providers that just know their product, know what problem they’re solving for the guest. Sometimes that’s just a safe, clean bed and I’m there for 4 hours and I’m catching an early flight in the morning and that’s it. And so you can provide great hospitality even in that context.

 

Robin: I totally agree. There’s absolutely nothing wrong with being dependable. That always sells. Well, let’s talk about loyalty. And what does loyalty even look like at the moment? I mean, once upon a time, it was very clear you joined a brand’s loyalty program and you stayed with that brand whenever you could because you were getting points or discount coupons. Is that still a thing or is loyalty starting to look like something else?

 

Josiah: It’s definitely still a thing. I was talking to a couple of friends that are planning a honeymoon, and as they’re traveling for work, they’re collecting, collecting their points, and they’re going to stay in this amazing bungalow in the South Pacific and I’m super happy for them. And so it’s definitely still a thing, but I don’t mean to discount that. But the reality is true. Loyalty is really the fact that I’m going to stay at your hotel and I’m not really thinking about price. Right. And that’s not just a pie-in-the-sky idea. I was talking with Scott Curran, who’s the chief operating officer at Renaissance Hotels here in the San Francisco area. He was telling me, hey, we run our operations such that I get messages from guests, my team gets emails from guests saying, just put me a room. They’re not asking about the price. They know they want that hotel. That’s the spot they stay when they’re in the Bay Area. And I think that’s what we should all aspire towards, is providing that you offer something that matters to me. And there’s a group of hotels out here that also really like called the Four Sisters Inns, and they have these little boutique properties and they have this little punch card where you stay every night and you get a punch and then you can get a free stay. But honestly, my wife and I just like staying at their properties. They’re not four times the price of a comparable one. But when we’re thinking about a weekend away, it’s not like, okay, let’s scout in every destination. It’s like, No. Does this group have a property there? We’re going to stay there, right? And I think that’s the sort of environment you should aspire to provide. And that happens through great service. It happens through thoughtful amenities, it happens through doing the basics well. But that’s what inspires true loyalty, where we’re not sort of bribing guests to stay at our hotels.

 

Robin: So you’ve been talking about a mixture of big brands and boutique properties. Supposing you’re listening and you’re a boutique or an independent and you’re kind of struggling because you’re traveler mix seems to be highly transient, where would you start with building better loyalty?

 

Josiah: I’m fascinated by ways that that we can creatively delight guests so that they’re talking about hotels online. And I spent a big chunk of my early career working in reputation management online reviews. How do you encourage people to share their experience online? And it’s not always over-the-top things, but it is being thoughtful around what’s something you can offer that stands out so that someone will say, Yeah, I’ll take 30 seconds, I’ll take a minute to leave you an online review. You got to go a little above and beyond to do that. And when you do that and you start collecting these online reviews, it plays such a big role in people’s shopping process. Right? And so if you have a highly transient customer base, you know, you want to try to build loyalty. But the reality is you may not have people coming back and sitting a lot with you. So you have to kind of think about, okay, how do I get those really happy guests to share their experience online? And there needs to be some element of surprise and delight to turn that.

 

Robin: Did you know that offering top cosmetic brands is a delight for your guests? For the last 50 years, GroupeGM has been a leader in the luxury amenity industry. The group proposes a 360 solution for manufacturing to distribution on cosmetic amenities and dry accessories. With over 40 international brands such as Guerlain, Nuxe, Atelier Cologne. The group offers different shapes and sizes of eco friendly products in hotels all over the world. This is possible thanks to its worldwide distribution network. Thanks to their Care About the Earth Program, you can offer your guests top cosmetic products with a reduced environmental impact. Discover more on www.groupegm.com.

 

Robin: I completely agree. And I also think a really great way to think about this. Two ideas. Number one, put yourself in the shoes of your guest and say, if I was staying here, forget about whether we think we can do it, whether we think we can afford it. What would I actually want? And then also look at what can I do? What can we do better than anybody else? What can we say? Quite legitimately, we’re the best at this. And it could be something really small or obscure. We have absolutely the best waffles or the best omelet in the Bay Area, and it doesn’t have to be a huge, momentous renovation project. It can be something small, but make it something that people really crave.

 

Josiah: Exactly right. And what I like about that example is it’s applicable across chain scales and kind of where you are in the country. And so you’re right, you could be a limited service hotel. And if you have for breakfast, it’s going to be the best breakfast. It’s clean in that area and people can rely on it. It’s dependable. And then I think as you go to the more lifestyle hotels, there’s such a wide range of of participants there where I heard about an owner that was a tinkerer and just liked making things. And so her whole vision for the world was that people should tinker around more, right? And so they designed the hotel experience to kind of cater to tinkerers. So it’s so authentic. But it came from her, from the owner, it came from the founder. Again, if you’re in that part of the ecosystem, think about what’s unique to you that you can uniquely offer if you’re a brand-limited service hotel. But there’s also something that maybe you could offer that you can consistently do well at is good to double down on.

 

Robin: I agree. Let’s talk about the other side of the coin here for just a second. If we’re thinking about loyalty, in your opinion, what is the biggest mistake that hoteliers can make and why do you say that?

 

Josiah: I think the biggest mistake is just assuming that you can kind of carry on with business as usual. I’ve seen in some cases where it almost feels that they’re taking for granted some of the sectors of business that historically have been performing well for them. And to the earlier part of our conversation, the world changes and you have to be responsive to that change. And so I think that would be the biggest consistent mistake I see people making is just being somewhat oblivious or just hoping that things will recover in this year to as they have been historically. And that’s not promised. Right. And so I think you have to be very attentive to what’s going on right now.

 

Robin: I think you have to be really good at pivoting in a hurry because the world is still in the midst of a tremendous transition. And we talk here about health concerns here or travel concerns there. And I don’t think anybody can assume that we know what this year is going to be like. We hear them talking about inflation and rates in the marketplace. And how is that going to affect not just hotel operations, but traveler demand, whether or not people can afford to travel or whether they’re going to say, you know what, I’m going to do a Zoom meeting or you can have a staycation this year. I just think that there are so many variables in play all at one time. Let’s talk about AI and all of these things. It’s fair to say on this show I have interviewed quite a few people who are bringing new AI products to the hotel space. And one of the things that they all have in common is they talk about the tremendous build benefits to AI for building guest engagement and lowering costs. At the same time you’re on neutral ground, if you will, to what extent would you say that AI really is the panacea for the hotel industry? And to what extent do you feel that if it’s misapplied, it’s just causing further breakdown or complexity?

 

Josiah: Well, first off, I enjoyed some of those recent conversations, So I encourage people listening to this. If you haven’t gone back into the catalog, listen to some of those past episodes. Because I think to your question of is it this sort of solution that is universally applicable, I wouldn’t go that far. I encourage you to think about what do you need a solution for? So to give you an example, right now I spend a lot of my time writing, so ChatGPT is great at creating written content, right? Does it make my life easier as a writer today? No. Might it in the future? Perhaps. I spend a lot of my time talking to hoteliers, telling their story. It’s real stories. It’s real examples. So the fact that I can spit out paragraphs of text doesn’t help me. It may in the future, though, look at patterns of the stories that people have engaged with and respond to. And maybe it gives some suggestions structurally on how I adjust these stories. But that’s a little example. Depending on if you’re working in I.T., if you’re working in operations, if you’re working in revenue management, there’s areas where I can and probably will provide more insight or speed up areas of your work if you’re looking at data sets.

 

Josiah: So machine learning and big data have shown a lot of promise so far in revealing where they’re outliers, what strategies can be changed, and they’ll be really interesting to see where I starts recommending things a little faster. So I think with big macro trends like this, it’s important to think about the applicability to your area of work today and not just like is AI a thing? It’s definitely a thing and it will become increasingly more so. But think about what the implications is for operations, for example. And I think a good litmus test for these kind of things is thinking, okay, what’s going to make life easier, especially for my staff. I was talking to the. Dorchester, SEO. The other day, and he was saying his only criteria for tech is, Does this make my teams’ lives easier? That’s it. And if it does that, then it’s a success. And so I would encourage listeners to kind of think about technology in that sort of lens.

 

Robin: I agree. I have a story for you. Unfortunately, it’s a true story. Recently, I had lunch at a hotel and the server asked at least three times during the meal whether I would write a review, and I finally said, Okay, sure, fine. And she gives me this card with a QR code on it, which is supposed to launch TripAdvisor. Well, I have to dig my phone out of my purse and interrupt the conversation, and I’m fumbling around because I don’t do QR codes very often. And I scan the thing and my cell phone says, okay, we got it, and the page does not launch. That just kind of left me entirely flat. And I was thinking about this. I think there has to be an awful lot of integration, both of staff training and testing of technology, and try it yourself, see if it really works. What would you say about all of this?

 

Josiah: Well, it sounds like a very frustrating story, and I think it’s I’m glad you shared it because it’s good to look at these cautionary tales. If we just talk about you should have great online reviews, that’s fantastic. But we might end up with environments like you experienced, right? Where it’s super frustrating. It feels awkward. I’ll tell you a story that I wasn’t planning to share, but it reminded me of what you’re telling me. And I was at dinner the other night with my wife and we were trying out a new restaurant, and I experienced some of the best hospitality I’ve ever experienced. It wasn’t a super, super fancy place, but the owner came out and was talking with us and got to know us. And then he went back to the kitchen and he came out and he said, Oh, we just tried this new salad dressing. I think you’re really going to like this. And he brought us out some salads and we didn’t even order this. He was just really excited about what he was making and just provide phenomenal service. The whole evening and halfway through our dinner, I turned to my wife and I said, I have to talk about this. I have to share this with the world. So I got out my phone and left a five-star review right then and there.

 

Josiah: It’s like this. That’s the example of something that you’re really delighting people and I know that might seem like a one off, but it would be interesting to think about in your business what’s something like that you can offer where I don’t feel harassed, I actually want to stop right now and leave a review. I will say from a more systematic perspective, though, technology can be helpful because I was staying at a hotel last week where they sent out the typical guest survey, but I filled that out, provided some feedback, and then at the end they had a very nice way of asking, would you mind kind of sharing this experience with others so they can understand what our hotel is like? It only took me, I think, like 30 more seconds to share that with the world, but it felt very natural. I had already kind of gone through the process of giving them this feedback I think I was waiting for. I was waiting for something. So I just because right time, right place, right way of asking and they’re doing really well online. And I think that’s a good example of using a kind of repeatable process to collect more reviews, not interrupting your lunch and asking for a five-star review.

 

Robin: As much as I’m all for advances in technology. I love your example of the salad because it’s low-tech and low-cost. I mean, we’re talking about lettuce here and it is something that any hotelier with an imagination could do. And sometimes all it takes is a couple of really great little cookies on the side of the teacup, and all of a sudden people are photographing what they got and putting it on Instagram. I love your story. So we’ve got a couple of minutes here. What, if you could wave your magic, wand would be your one piece of actionable advice that really any hotelier can do to improve guest loyalty?

 

Josiah: So I’m going to stay with what we were talking about right now. And my piece of advice is create something worth talking about. It sounds kind of vague, but let me break this down in something very specific. So if you’re an individual that’s providing hospitality on the front lines, that’s listening to this, think about one specific thing you can do in the way that you provide service in the context of your business. That’s going to put a big smile on someone’s face. We’ll get them to leave an online review. I love for you to think about that individually. If you’re a manager or a brand leader, think about how you can institutionalize some of this. And many brands do a good job of this. I see a lot of operators encouraging this, but this may look like creating some sort of a process where you’re collecting ideas from your team on one thing they did creatively to provide service and then call that out in your team, all-hands meeting and this kind of this process of putting a spotlight on your team members who are the lighting guests is how you build real, not bribed, loyalty and get people leaving those online reviews get people coming back to your hotel. So I would think very practically, kind of in the context of your business, what it looks like to put a big smile on someone’s face and really delight them this year.

 

Robin: I think that is a great way to look at it because that works really well whether you’re an independent operator with a very small property or whether you are a five-star. But you can create a special moment for somebody really just with a little bit of creativity, a little bit of ingenuity, using your eye to find out a little bit extra about who is staying with you. Josiah, I want to thank you so much for finding time to chat with me again. It’s great to see you as always. You’ve been listening to the Innovative Hotelier podcast brought to you by Hotels Magazine. Join us again soon for information and up-to-the-minute insights, specifically for the hotel and hospitality industry.

 

Josiah: Thanks, Robin. This is always fun.

 

Robin: You’ve been listening to the Innovative Hotelier podcast by Hotels magazine. Join us again soon for more conversations with hospitality industry thought leaders.


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