Earlier in hospitality domain, the pricing structures and decisions were majorly based on factors like supply and demand, local events, corporate/negotiated rates, event/group bookings, majorly because of the absence of hospitality technology tools. With the advent of hotel price intelligence tools, competitor rates became an important factor in pricing. However, in the current scenario, the focus is shifting to guest reviews and ratings. Now, the price that you can charge for your room is directly proportional to your hotel reputation, specifically online reputation.
Reputation Management touches the property as a whole and needs to be the responsibility of every department in the hotel working together. ORM should go hand in hand with Revenue Management. Your hotel reputation should also guide you to use reviews to influence your decision-making process and effect change where required.
Hence, Online Reputation Management is immensely important for hotels and travel companies because customer reviews have a direct correlation with demand and hence pricing, which is the holy grail of revenue management.
Working on your online reputation, reviews and rating includes improving guest satisfaction by enhancing operational effectiveness and efficiency and remembering all this pays off monetarily. As a smart strategy, hotels should make sure that the time and efforts invested in ORM improve their direct bookings, ADR and RevPar. Hence, by improving your hotel reputation and sharing the outcome with all other consumers, both revenue and guest perception improve.
A recent study from the Cornell School of Hotel Administration has also further established this finding, that guest satisfaction has a direct impact on the commercial performance of the hotels.
The study says that an increase of 1 point in the hotel’s review scores leads to an increase of 0.89% in price (ADR), a 0.54 % increase in occupancy, and a 1.42% increase in Revenue per Available Room (RevPAR). The research also verifies that the influence is across all distribution channels, whether online or offline.
Another research by a reputable organization has established that a positive online hotel reputation has the power to demand higher prices on online platforms.
One of our esteemed customers Mr. Vishal Kamat, Director Kamats Group of Hotels and CEO (Fort Jadhavgadh) agrees to this finding that the positive sentiment of online reviews diminishes the impact of price on the consumer purchase decision. This implies that higher number of positive reviews influence a traveller to pay more for your property whereas bad reviews will discourage bookings, even if your property is at discounted rates.
This finding simply suggests that hotels need to focus on guest satisfaction, guest review and ratings as they make pricing decisions for their hotel
Simple and Easy Tips to Manage your Online Hotel Reputation
- Be present where your guests are – The hotel GM can get the most valuable feedback by being present in the lobby or the dining room, talking directly to guests. But, there are thousands and even more of them on social media and review sites. Hence, it is beneficial to know the online platforms important to your guests and where the most influential reviews are posted.
- Understand which social media platforms are delivering more revenue to your property – Know what booking channels guests are using to book reservations, and make sure your reputation on those channels is good. And focus your energies there.
- Be steady and consistent– You may begin slowly but be steady. This means just pay attention to what guests are writing about your hotel and respond when appropriate and required. You do not have to respond to all the reviews.
- Always be kind and polite in your language and choice of words while responding to guest reviews. Be professional in your approach and respond to everyone in a respectful manner. Communicate with them as if they’re guests in your lobby.
Remember the nature of social media is such that your response will never go away hence be careful of what you post.
- Own and respond to negative comments – Responding to negative reviews shows that you know there are problems that come up and at times things can go wrong. However, you are ready to do your best to fix those problems.
- It is perfectly OK to apologize for a bad experience to a guest. Write a response that includes a genuine apology and a commitment to ensure not repeating the sad experience. However, refrain from owning and being apologetic about an untrue review.
- Embrace social media and review sites as a learning opportunity. No one likes to receive a negative review, but if you use it constructively to correct an issue, you will have an overall better property and eventually more positive reviews.
- A public promise to correct the situation right is completely ok. However, never offer compensation, particularly free rooms, etc.
- Connect with the concerned guests personally and promise them that you will make up for their bad experience by offering discounts on next booking. Avoid getting into a back-and-forth with guests online.
- Encourage your guests to write reviews—good or bad. You can use either a guest survey tool for this or a simple reminder at checkout. But never offer incentives for writing reviews.
- Avoid using pre-defined templates for responding – Appreciate that your guests are taking time to share their experience. Spend time to personalize your responses—especially for those guests who appear to be dissatisfied or highly appreciative, or the guest and travelers who have a lot of influence on that platform.
For more information on how to manage your Online Hotel Reputation, please read our guide – What to look for in a modern Online Reputation Management Tool
It is advisable to have a designated team to handle your online hotel reputation management. However, in the absence of a team, it is okay to have a group of people involved. Nevertheless, always have a leader who can make decisions and set guidelines for managing your reputation.
To conclude do not fixate over return on investment immediately. Online Reputation Management is not always going to be a direct revenue opportunity. Sometimes the payback might come two years down the road when a guest satisfied with your response makes another direct booking at your hotel.
Therefore, hoteliers stay focused on improving your service quality and returns will certainly come.