Hotel Resort Fees: Sales, Deception and Short-Term Gains at the Expense of Reputation

Posted on April 29, 2012 by teds

I’ve written about the negative association of nickel and diming on brand experience and loyalty but there’s a related topic that’s becoming more common and drives me nuts: resort fees.

It seems that, to keep rates looking low and win eyeballs on third party travel sites, hotels from Vegas to Disneyland are adding in mandatory fees presented on arrival which cover the obvious and not necessarily the used (I’ve seen them for gyms, pools, etc) with no choice but to agree.

Deception exists when perceptions are not set.

It’s bad enough when you have to pay for the obvious (how many people want WiFi versus in-room coffee) but when something is mandated upfront, it must be in the buy box, the sub-total — right in front of the customer. Sticking it in the fine print of a corporate is about as transparent as making it up at the time of check-in.

The implications to brand & the bottom line are no small addon.

Gaming the customer can return a short-term gain but we must consider the long-term result that follows our experience and the reputation it creases.
Price may lead the buying process but 5 full or empty stars sit right next to it and the impact shows. I don’t have hard numbers but inline comments from TripAdvisor, Yelp, Expedia, and even Hotel sites paint a clear picture of how, after a resort fee enters the equation, negatives go up, perception of value goes down. That game causes the equation to shift.

This is not just true of hotels either. Any time a customer is forced into something after the fact — whether its required component to an electronics device not put in the box, an unexpected servicing need, or whatever, it’s going to leave a bad taste to the customer and give them a reason to cry out to the world that is always listening.

As comments shift from accolades and experiences to tips and warnings, the very issue which the resort fees are mean to skirt (pricing perception) becomes the focus as people become that much more aware, and comparison focused as they fight to understand the true (all-in) value being offered.

Social must be a part of the entire corporate culture.

While social is often caught up in the Facebook/ Twitter/ Google+ channels, it is really the buzz word that sums up focusing on reputation both as the spread of knowledge and the reality of immediate experience.

By thinking “social” outside of marketing it it’s possible to see beyond a single channel… A resort fee augments revenue and tricks sales today, but businesses to not survive on today alone thus what happens to experience, reputation, social must be just as important to sales and ops as it is to a marketing team. Companies cannot survive working in isolation.

When people are surprised by a forced cost it trumps everything else… Even if the value remains great.

“I love Black Friday!” Dissecting the motivation beyond the shopping phenomena

Posted on November 25, 2011 by teds

It’s somewhere between midnight and sunrise and as I pause my Black Friday research for another caffeine break [after more than a dozen destinations spanning two malls and three counties, there’s been a number of those], I’ve found myself asking one question: what is it that has propelled Black Friday to reach almost as much notoriety as the holiday it follows?

What it is that makes people line up 6, 12 even 24 hours in advance? Is it the deal? Being able to claim first in line?

Certainly price has always had a lot to do with it and even more so in this economy as evidenced by the degree of the deals being offered and the scrutiny they’re getting. But only a few get the $199 doorbuster TVs while hundreds more wait in line knowing they’ll be picking at far smaller deals – there has to be more. At the end of the day we’re talking about sacrificing personal comfort, a traditional Thanksgiving dinner [or at least a long conversation after it] for something that can often be matched online and savings that amount to just a few dozen dollars on items that are hardly necessities.

Great Deals + Sharing = The Black Friday Experience

If we put aside our brand / marketing hats for just a minute, pull out the social science degrees so many of us spent years working on, and put ourselves in the shoes of consumers I think we can see that the success of Black Friday it boils down to our social nature. No doubt the deal is essential but looking at the person to your right and left and realizing that you all share the same goal changes things from a deal into an experience, something you don’t have to quantify the measurable ROI from and are willing to do not just once but year after year. Add in the exclusivity — whether it’s a limited count doorbuster or making a “sacrifice” to just be there and it’s not surprising that many people find the whole event to be, well, fun. Seeing how Black Friday checkins, social comments and posts have grown even faster than the lines is certainly a testament to our desire to participate with others about what really amounts to nothing more than shopping.

As I talked with people tonight and heard their excitement, even saw a few faces walk out the store after hours of waiting without a purchase or disappointed look, there’s no doubt that for businesses to thrive in this market means going beyond the price war and building on the sense of adventure, chance … of the Black Friday experience. In the race for the customer, the bottom price is not where you want to try and make your stand and yet without offering anything but a deal, its where so many have ended up to the point that 30% off no longer feels special.

As Black Friday Becomes an Event, Success Will Depend on More than Price

But this year with the big transition towards 12am openings, I saw new ideas being tested out there. Best Buy ran movies at select locations; Food Trucks were called in by malls, and straight giveaways like free water are becoming more and more common. It’s personal too: I watched security guards and store employees spend hours outside chatting and standing alongside the crowd when they could have just as easily remained inside their warm stores. All of these actions speak to the link between our customers and our brands – you can call it an incentive, a hook, but the result is that its building community and giving people a sense brands are relatable.

As we see more consumers take part in this communal shopping event, more stores will get into the early openings and offers will increase making it even more important to be seen in the right light, to be more than just a place looking to take people’s money but instead offering up a little empathy, some excitement and perhaps soon a free cup of coffee in exchange for 12 hours of someone’s time.

Of course 8 hours in line are quickly forgotten as the doors open and people rush as fast as they can “walk” towards that big offer – but as I watch people filtering out of this store and back to their cars, it’s clear that the experience is as much a part of their excitement as the savings that exist at 3:30am.

Service: It goes a long way… how AT&T kept my iPhone 4s business by being honest

Posted on October 7, 2011 by teds

A little background….

6 months after getting the iPhone 4 I took it rock climbing and put a nice big crack in the front. Everything worked but needless to say I’ve been counting down the days until the new version was announced… 5, 4s, 2011… As much as I wanted the curved design, the features were almost irrelevant.

But while my upgrade decision has been stable, my carrier choice, not so much… Not [just] for the usual AT&T complaints but because half of my new apartment flat out doesn’t get a bar of service. So, while my contract may not be up, it seemed worth the termination fee to make a jump.

And then came an [unexpected] great customer service moment

After reading tweets from @DannySullivan and some “unknown” friends, I prepared for a battle on the phone, to push through a wall of counter arguments from one of AT&T’s “resolution specialists” [seriously, that’s their I.V.R. greeting] and all the usual drama you expect when calling a company. My experience has always been that these “service” battles actually make it easier to cancel out of sheer frustration, but none the less, it’s a painful experience to know you’re walking into.

But after a few minutes on hold and giving out all of my personal information again the rep didn’t fight me. Instead he merely asked what the issue was and when I explained the lack of signal coverage, he apologized. Rather than going into a pitch, he then told me the cancelation cost [$325 - $10 / month of service was $175 for me] and how to cancel to insure a smooth transition of my number, how to get a hold of AT&T after the change for any issues, etc. Only as he was finishing up did he finally throw in a “I realize this won’t fix your signal issues but if you want to stay I can offer you a small credit off your bill, if not…”

Attitude. That’s what good service is about.

The rep offering me $75 wasn’t a deal breaker; heck that’s well less than a month of service between my minutes, texting and data + tethering package. Verizon’s service doesn’t work great here either [why there’s poor coverage in a “upscale” apartment community with 750+ units is beyond me] but between their trade-in programs, a better service reputation, and just being a different experience I was willing to jump ship despite the added cost until the rep, and thus AT&T, demonstrated commitment to me as a customer. Sadly commitment has become a rare thing these days.

The rep did everything other than what I expected. He was polite and legitimately apologetic. He provided the information I wanted first, an offer last. And when I took him up on it, he made the process seamless, taking the order, getting the right information, providing the little details [like the fact that the phone may just show up after the 14^th despite what websites say]. As icing on the cake, he also noticed that – for a reason which he didn’t know – I’m getting another $75 credit from AT&T in a few months for having an iPhone with my particular history… a retention bonus… we all know keeping a customer is far cheaper than replacing them.

iPhone ordering makes for great case studies because, between millions of experiences, you have the best and worst service scenarios all coming together around one constant. The apple website should be a prime example to every single etailer of how you make a shopping experience – the selection process is about a solution, not a shopping cart; the up-sells appear as value-adds and never stand in your way; the form fields are minimal and rarely error on a legitimate entry [like a special password or unique address]; and between split payments, multiple-financing options, and gift cards, it’s just as flexible as shopping in store. On the other hand you’ve got stories from the carriers of nightmare hold times, conflicting upgrade information, insanely high costs, near arguments over account features, discrepancies in warranty offerings & information… all in one ordering experience.

I didn’t expect to have a blog-worthy experience in upgrading a phone but what AT&T did goes beyond their service, iPhones or the cell industry – the sad reality is that we, as consumers, have come to expect our opinions to be practically ignored, to be hard-sold by someone reading off a script with 3 different levels of service and to be brushed aside with generic response. Despite all the talk of being social & transparent, most of customer service is still about getting the issue to a “closed” status rather than actually engaging to understand, acknowledge and learn from the issue.

The truth is you can’t always fix the root problem a customer is having but when you allow your reps to be honest, friendly, informative, and let them decide how to handle a negative based on their expertise doing this hour after hour, you do what customers don’t expect… care.

——————

Unfortunately I didn’t get the rep’s name; but if anyone from AT&T reads this, email me and I’ll give you the order number as he deserves a thanks.

Social Media Strategies: You can’t afford to turn the computer off Friday at 5

Posted on December 23, 2009 by teds

I think it’s safe to say we all enjoy getting away from the office at least sometimes but for many companies, social stops when the clock strikes 5 (or maybe 6). While there’s a lot of logic behind this in the eyes of those doing the posting it doesn’t reflect the reality of the channel – customers don’t stop knocking. The notion of responding 24×7 or close to it isn’t new, many companies have customer service on 7 days a week, 24 hours a day, potentially every day of the year, but with so much of social being handled by more “senior” staff this philosophy is often forgotten.

When companies go away from their channels two important things happen – first the questions stack up which is an annoying experience for the customer who is waiting and the employee who must wade through tweets all of Monday but more importantly an opportunity is lost.

Think about it for a second – a few years ago your web traffic was probably minimal on the weekend and big during the week. Weekdays may still be bigger than weekends but it’s a digital world and people are online all days of the week, from the office, from the home, even the mall on their cell phone.
Think about it some more – issues happen 24×7 and in a connected world no one waits to hear back on Monday. By the time you respond to provide the insight your customer needs, they already bought or that new nasty video with an incorrect fact is already out there.

The solution is of course an unpleasant one for anyone reading this but it is reality. You need to be on more than from the office. Whether it’s a customer service rep taking an hourly glance at automated reports or your staff actually getting into the weeds the biggest gains happen when no one expects it. Respond at 9pm on a Sunday and you’ll wow a few power users. Get product announcement clarified and you’ll avoid the confusion from that one blog. It’s not like you aren’t already on checking your own accounts anyways…

Social Media Strategies: Who should respond? Customer service or marketing

Posted on December 21, 2009 by teds

We’ve all read the case studies about Comcast, Dell, Jetblue and a handful of other companies who have changed their business (or at least changed what the media said about their business) by engaging in social. But while it’s exciting to talk about getting your own strategy going and how to “blow up” your business social always come down to one simple question, whose going to respond and when?

On one hand you have your customer service team, a group accustom to working with customers, tasked with fixing problems and [hopefully] knowledgeable about your product, policies and other particulars.

On the other hand you’ve got marketing which is probably the group driving social and has the most access to specials, new campaign information and the juicy details the customer wants.

The problem with delegating out to customer service is that, unless you create new roles and train new staff, you’re responding 1 to 1 on a platform that’s seen by 1 to many. This may seem like a minor issue but when your response ends up on the front of a major blog it’s anything but. Marketing on the other hand is often out of touch with the details of the customer experience (and I’m saying this as a marketer) so getting into support requires learning those find points. Neither side is perfect.

The solution that I’ve always found to work best is the one that gets the customer what they want – the right answer, in the right format fastest. Whether this comes from marketing or customer service isn’t a matter of black or white, it’s a matter of who can do it and who can commit the time to checking Facebook, Twitter, Myspace, YouTube, Flickr, Your Blog, The Other Blog, the new video site, the old video site, the second twitter account and that one last blog all the time. If your entire customer service team is hourly it’s not going to be them. If your marketing team isn’t willing to get into the trenches they should stick to strategy.

Either way you slice it the best idea is always to carve out that person. This can be a new resource if budget allows or an existing repurposed one. New clearly has the advantage of being able to get trained and focus on nothing else but sometimes that long time employee who is looking for a new change of pace already has the insights to know how to answer the product questions.

What’s most important, the detail you can’t forget ever is that people who contact you through social are doing so because it’s the channel they chose to use. If your resource doesn’t check it frequently, doesn’t respond well or just ends up pushing them to other channels there’s no use in having them there so whoever you pick, they need to have the permission and backing of the company to go out, give answers and perhaps use a little different tone or brand than may be the status quo – after all, this is social media.

Reviews come when you ask for them. So ask.

Posted on September 27, 2009 by teds

While Online Reviews for products are overwhelmingly positive the same should not be said for reviews found in other areas. Take a look at the list of apartment communities in the SF/ Bay Area below and you’ll see that none passes the 3.5 star mark – a low ranking by any standard.

The reason for this is not however bad apartments (though there certainly are some). The culprit is in fact something much simpler to remedy – a lack of information. It goes without saying that if you don’t know to do something, you won’t and apartment ratings are one thing few people know about until they chose to review a new home. What if instead of waiting for people to find their way to reviews apartment companies put a sheet in with their lease renewal and termination packages that offered a $25 gift card or rent discount for leaving a comment on their site, apartment ratings or another platform? What if rather than doing door tags every month about referring friends they directed people to a facebook-connect powered page asking to talk about where they live.

And you don’t need a lease to get people writing reviews. Product inserts, thank you notes for loyal customers, links on your email footers, website or any other communication piece is an opportunity to tell people that you’d like them to leave a review and give them a reason too.

Most customers but good experience and good experiences are not what people think about sharing. We’ve all heard adages like 10 bad comments for every 1 good and whether or not this is the exact number the sentiment is true. People gripe when there is a reason to and far fewer jump in when they don’t have something to vent. There’s nothing bad about asking people to lead a review and if done right, nothing underhanded either. Compensating everyone for a review is a fair statement. Positive, negative, it’s all a review and all gets the same treatment. No one can fault you for that.

And this issue isn’t limited to apartments – all sorts of niche businesses face a similar challenge from Vacation Homes to local Bakeries. If customers don’t know they can leave a review the odds are they won’t. Unless of course they have an experience so bad they can’t stop themselves from talking about it.

Customer service… when done right it is social marketing. When done wrong it’s just a disaster.

Posted on April 8, 2009 by teds

Zappos has made one of the biggest web businesses because of their customer support and commitment to insuring the product is right. Whether a call takes a minute or an hour their agent is looked at the same; returns are gladly taken and refunds are no issue. For many companies however, customer service remains about minimizing calls, call time and basically avoiding the customer after the sales funnel ends. With so much cost associated in providing a high level of service it can seem like a silly decision to make but ignoring service comes at a big loss and as Zappos has shown, providing it comes at an even bigger gain.
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Just because it’s a bad experience doesn’t mean you can’t fix it

Posted on June 14, 2008 by teds

Everyone has a horror story about traveling so it should come as no surprise that I’m writing about one of mine. The issue was bad, the employees were nearly useless yet resolution was nearly shocking in how GOOD it was. So how do we as corporate employees respond to an issue when you’re potentially sitting thousands of miles away and what take aways can we all learn from the good and bad experiences we have in the real world to apply to our own business.

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