Service Recovery in the Digital Age Feb 13th, 2014 Presented by Felipe Colina

A Revinate Webinar, in partnership with

About Revinate

SaaS tech company based in San Francisco Singapore, Sydney, Munich, Abu Dhabi, Amsterdam & NYC offices

Founded in 2009

80+ full-time employees

23,000+ hotels in 143 countries

Focused on Hospitality & Restaurants

Four Years, 23,000+ Properties

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Agenda

1. How hotels fail when it comes to service delivery 2. Tips and best practices for service recovery 3. Emerging technologies for service recovery

How hotels fail when it comes to service delivery

Service failure is inevitable

But it’s what happens a!er that matters….

Failure - - it happens to everyone

Bad stays, real consequences

Dissatisfied customers ……………. Damaged reputation ……………. Unresolved Issues ……………. Lost sales

Silence does not equal satisfaction

Customers  who  do  not  complain  does  not  mean  that  they  were  totally  sa6sfied  with  their  visit    

Many  customers  can  be  passively  voicing  their  dissa6sfac6on  

Why don’t guests share feedback?

Don’t  know  who  to  

complain  to  

Don’t  think  it  will  do  any  

good  

May  accept  part  of  the  blame  

May  want  to  avoid  

confronta6on  

Service Recovery: Financial Benefits

METHODOLOGY Sample: Brand used for this study is upscale full-service brand with a large number of hotels nationwide that generated over 300,000 survey responses. Purpose: Identify the effect of problem resolution on intent to return and then apply a methodology to calculate the financial effect of service recovery efforts Calculation: Revenue recovered calculated based on the intent.

FINDINGS The study estimates that the brand recovers $158,951,080 (per annum) by employing recovery efforts.

Tips and best practices for service recovery

Service Recovery Paradox

Service Recovery Paradox: Example

METHODOLOGY •  Sample: 11 four-star hotels (three

independent and eight belonging to chains) in Canary Islands

•  Focus: hotel reception and restaurant services of the selected hotels

•  Measurements: questions asked about: •  Perceived quality of service at the

reception and the restaurant against expectations

•  If they had made a complaint, and had been asked about it by staff

•  If an effective service recovery effort was made in response to this complaint

FINDINGS •  Customers who had experienced a recovery

encounter perceived a higher level of service quality for intangible attributes than non-complaining customers

•  These intangibles are assurance, empathy, reliability and responsiveness

•  Customers who complain, but experience a high level of service recovery, may be even more satisfied than those who were satisfied in the first place

Common Service Failures

Common  Service  Failures  

Most  services  failure    are  fixable!  

Attitudes During Service Recovery

RAY  HOBBS  Senior  Vice  President,Kelco  Management  &  Development  

Attitudes During Service Recovery

1.  AGenHon    STOP  WHAT  YOU  ARE  DOING  –  Give  the  Guest  your  undivided  aGenHon  DO  NOT  BE  DISTRACTED  –  Concentrate  solely  on  the  Guest  -­‐  Request  assistance  from  other  Associates  MAKE  EYE  CONTACT  –  Maintaining  eye  contact  with  the  guest  confirms  you  are  paying  aGenHon  BE  EMPATHETIC  –  “I  can  understand  how  this  has  inconvenienced  you.....”    

2.  AcHon    ACKNOWLEDGE  THE  GUEST’S  CONCERNS    TAKE  NOTES  –  Ask  the  guest  to  allow  you  the  opportunity  to  write  down  their  comments  CLARIFY  –  Repeat  what  you  have  heard  and  ask  quesHons  to  make  sure  you  understand  the  concerns  APOLOGIZE  –  “I  am  so  sorry  this  has  occurred  to  you......”  TAKE  OWNERSHIP  –  “I  am  going  to  personally  take  care  of  this  for  you!”  AND  you  do  it!  OFFER  OPTIONS  –  Provide  opHons  for  resoluHon  of  the  issues  to  guest  –  allow  guest  to  choose  INITIATE  ACTIONS  –  Begin  acHons  and  involve  those  needed  to  bring  abut  a  swi_  and  complete  resoluHon  with  the  guest  confirms  you  are  paying  aGenHon  

3.  Follow  Up      REMAIN  IN  CONTACT  –  Maintain  frequent  contact  with  guest  to  keep  them  informed  of  resoluHon  progress  FOLLOW  UP  –  Contact  guest  to  ensure  acHons  taken  have  brought  about  a  resoluHon  the  guest  is  happy  with  COMMUNICATE  –  Enter  info  in  Service  Recovery  Log  Book.  Review  with  Associates  on  next  shi_  INFORM  MANAGEMENT  –  Write  a  note  to  GM  or  leave  voice  mail  message  for  GM  to  advise  of  guest’s  concerns  and  acHons  taken  

RAY  HOBBS  Senior  Vice  President,Kelco  Management  &  Development  

Service Recovery Frameworks

Conduct  customer  research  

Iden6fy  services  problem  

Resolve  problems  effec6vely  

Learn  from    recovery  experience  

Modify  service  process  monitoring  

Monitor  service  process  

Make  amends  to  the  hassle  factor  

Set  up  problem  tracking  System  

Monitor  customer  complaints  

Nurture  the  people  factor  

Conduct  root  cause  analysis  

Service Recovery Standards

•  Set standards for response time for issues that arise •  Designate customer service champions in each

department to ensure guests issues are reported and shared

•  Explain what compensation options are available for employees to offer and empower them to do so

•  Build in contingencies for when a problem escalates beyond a single incident

•  Incorporate previously reported issues as examples to use for future benchmarking & best practices

Learning from Reviews

Unsuccessful Service Recovery

Learning from Reviews

Successful Service Recovery

Social Media Crisis Management 1.  The  Complaint  

3.  The  Response  2.  The  Crisis  

Emerging technologies for service recovery

Rise of the Silent Traveler

•  Tech savvy and dependent on mobile devices throughout all stages of travel

•  Prefers online and digital

communication, to human interaction

•  Expects speedy engagement and service delivery

Service Delivery Trends

CHEKITAN  DEV  Associate  Professor  at  Cornell  University,  School  of  Hotel  Administra6on  

•  Speed is of the essence •  Ideal wait time between desiring, requesting and

receiving a service is zero •  How do you reduce the time between a service

request and delivery? •  Explore other channels of communication

•  Guests paying more attention to amenities and services in the hotel

•  As hotels become commodities, hotels that respond the fastest win

•  How they respond (through new technologies vs. traditional) varies by audience (millennial vs. Gen X/Y)

•  Don’t confuse hospitality and service •  Best service isn’t always face-to-face service •  It’s providing a kind of service that the guest wants

rather than the kind we think they should use •  Sometimes technology-driven service recovery is

the better option

Digital Signage

A  digital  tour  guide  system  in  the  lobby  of  IHG's  Staybridge  Suites  hotel  in  New  York  City  lets  guests  get  informaEon  about  the  city  in  an  interacEve  way.(Photo:  Todd  PliI,  USAT)  

The  digital  screen  at  the  Hotel  Indigo  Athens-­‐University  Area.  Guests  look  up  informaEon  about  their  desEnaEon  and  post  photos.  (Photo:  InterConEnental  Hotels  Group)    

The Power of Mobile Connectivity

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Benefits

Closing Thoughts

Closing Thoughts

•  Failure is not final •  Stable service recovery processes have a positive correlation with guest

satisfaction and loyalty

•  Service recovery is not just compensation •  Speedy recovery and stable processes are what truly drive guest

retention

•  Capturing feedback is key to service recovery •  Hoteliers must make it easy, fast and engaging for modern to share

feedback

•  Modern technologies enable efficient service recovery •  Hoteliers can capture feedback via tablets and delegate actions across

their staff via mobile devices

Questions

Stay in touch!

Felipe Colina Marketing Manager | felipe@revinate.com

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