For Hospitality, Social Media Is Too Little Too Late

Transcription

1 Point of View Social Media For Hospitality, Social Media Is Too Little Too Late When it comes to the hospitality industry, social media is really good for some things, and really bad for others. Getting these things straight is awfully important if you want to take advantage of the power of social media, and avoid its potential pitfalls. Social media can be a useful channel for customer listening. But if you re using social media to manage your reputation, you re too late. By the time a negative review is posted you re doing damage control, not reputation management. Authors Dr. Jonathan Barsky, Ph.D. Co-founder and Chief Research Officer Mike Waite Vice President

2 Can we talk? When it comes to the hospitality industry, social media is really good for some things, and really bad for others. Getting these things straight is awfully important if you want to take advantage of the power of social media, and avoid its potential pitfalls. A lot of people are trying to use social media to manage their hotel s online reputation. Some are even trying to use it in place of their traditional guest feedback program to make important product and service decisions. These people are missing the point. The mistake these people are making is applying social media data where it can t do the whole job. Social media can be a useful channel for customer listening. But if you re using social media to manage your reputation, you re too late. By the time a negative review is posted you re doing damage control, not reputation management. And when it comes to making product and service decisions, social media alone isn t representative, accurate or deep enough. In fact, some people believe as many as 40% of online hotel reviews are made up! So while it s important to monitor unsolicited customer feedback and engage in online conversation, social media data alone can t provide the accurate, representative and rich data you need to run your business. Here s why: Bogus reviews As hospitality companies increasingly depend on positive reviews, a market for promotional reviews has sprung up to buy and sell fictitious feedback. Many promotional reviews are obtained through help-for-hire sites like Fiverr and Mechanical Turk. The demand for positive comments has turned online reviews into an arms race. With more properties receiving five-star reviews, even more five-star reviews are needed to stand out from the competition. So you buy them. Long a concern in the hospitality industry, Gartner recently confirmed what many have feared. Their report concluded that as many as 15% of online reviews will be paid for by Other estimates go much further putting the frequency of fake reviews as high as 40% 2! There is little to prevent madeup reviews. Very few online review sites and virtually no social media platforms require any proof that a reviewer actually visited the hotel or restaurant they re reviewing. And research has shown that there are more fraudulent postings on websites that don t require purchase authentication 3. This vulnerability applies to the largest online review site as well as the largest social media websites. 1 Sussin, Jenny and Thompson, Ed, The Consequences of Fake Fans, Likes and Reviews on Social Networks, Gartner, July 24, Schaal, Dennis, Hotelme Attracts $3M In Funding And USA Today As Partner For Unique Hotel Review Site, September 18, Ott, Cardie and Hancock. Estimating the Prevalence of Deception in Online Review Communities, WWW 2012 Session: Fraud and Bias in User Ratings. April 16 20, 2012, Lyon, France 2

3 There are ways to game the system that are less egregious, but still reduce the authenticity of reviews. For example, hotels offer discounts and incentives in return for a favorable review. A high-end English hotel, The Cove in Cornwall, was recently accused of soliciting guests to post an honest but positive review on TripAdvisor in exchange for a ten percent discount. Nearly all the recent reviews of the Cove are glowing, except for the one headlined, Sadly let down by overhyped reviews. 4 Thin data Trip Advisor has collected, on average, about 10 reviews per hotel per year. If you include all top 10 review sites, the number of reviews per hotel goes up to about 15. That s just not much information. Certainly not enough to represent a clear and balanced view of customer experience. And nowhere near enough information to look at important segments, like frequent guests vs. first-time visitors. If you manage larger properties you can expect more reviews, but the numbers are still tiny compared to a survey-based feedback program. We compared 650 larger properties in the US, Europe and Asia with a minimum of 60 rooms per property. They received an average of 185 reviews in the last year (October 2011 through September 2012) across all top 10 review sites. The same properties during the same period received an average of 1,159 completed guest surveys! 4 The Pew Research Center s Internet & American Life Project s Tracking Survey conducted July 16-August 7,

4 No service recovery The time to fix a problem is when it occurs, not when it s already been posted to the world. But with feedback systems based on social media and online reviews, that s when you learn about them. Most online review sites don t post guest reviews for four or more days, long after the customer has left. And when you rely on social media for feedback, you don t learn about problems until a customer has already shared it with their network. The best way to improve your online reputation is to prevent negative reviews in the first place. Unresolved problems have a dramatic impact on guest loyalty, driving it down by 56% on average. That means more than half those customers don t come back. What s worse, guests who experience a problem are nearly three times more likely to write a review about it online. Market Metrix Hospitality Index data indicate that guests who have a problem write a review about it 22.6% of the time. Guests without a problem write reviews just 8.8% of the time 5. Recovering from a problem is critical. Almost two-thirds of the loyalty lost due to a problem can be regained if the problem is addressed. Survey-based platforms can collect guest feedback at the point of experience. Negative scores can automatically put service recovery steps into action, alerting the right person about the problem so it can be fixed right away. That s how you turn a negative review into a positive one, and build your online reputation. 5 Market Metrix Hospitality Index, 2011 survey results representing 134,261 respondents 4

5 Distorted view When we read a mediocre book, we don t usually tell anyone about it. The same is true of our hospitality experiences. It takes an exceptional experience to motivate sharing. So opinions shared through social media and online review sites are often extreme points of view and don t represent the complete spectrum of experience. Sadly, it seems like negative experiences are more motivating to share than positive ones. We compared TripAdvisor reviews against guest surveys for the same properties during the same time period and saw radically different pictures. The TripAdvisor data showed nearly three times more negative (1- and 2-star ratings) responses, while 5-star ratings were understated by 35%. This disproportionate view of your business could mean millions of dollars spent to solve problems that aren t having a significant impact on your business. Likewise, sources of value, the things most likely to attract guests and gain their loyalty, could go unnoticed. 5

6 Important? Or just loud Some problems happen a lot. Others can really hurt your business. But they often aren t the same. Some very frequent problems, like a faulty TV remote, have very little impact on loyalty. Others, like a rude desk clerk, may happen infrequently but are severe business killers. With social media there s no way to distinguish the most important problems from all the rest. The only indication of significance is discussion volume on a particular topic. But volume is not the same as importance. The only way to figure out how important a problem is requires looking at its impact on loyalty or revenue. And that isn t possible with social media. Without any connection to loyalty or revenue, social media also fails to isolate the product and service attributes that really drive business success. So you can forget about creating performance-based incentives for employees because you have no way to establish what they ought to be focusing on. No diagnostic detail Other than a few simple questions on review sites, social media content is entirely unstructured. Consumers can tweet about their experiences in 140 characters, review hotels on TripAdvisor by answering a few basic questions, or tell friends with a Facebook post. But other than posting a thank you (or an apology), what can you do with this information to improve your service? None of these offer a very clear or complete picture of the guest experience. 6

7 But surveys can guide the respondent to consider the entire experience, not just the one thing that stood out. Standardized questions make measurement more precise and consistent by allowing uniform definitions. And because we know who the respondent is, feedback can be connected to everything else you know about the guest. That means you can respond to guest input directly, and discreetly, rather than posting anonymously to a social network. Online reviews and social media feedback provide an extremely limited view of the customer experience. Demographic Bias Not everyone participates in social media, at least not at levels that are commensurate with the population. Younger people are over-represented and older segments are under-represented, sometimes dramatically. To begin with, only 56% of the US population participates in social media 6. And for adults over 50, the number falls to just 20%! Do you really want to miss hearing from 80% of the people who spend more money on hospitality than any other segment? A survey-based approach, on the other hand, allows you to invite every single customer to complete a survey. Most can be completed online. But the important thing is that everyone can be accommodated send a simple text survey to their phone, hand them an ipad with an open link, you can even give them a paper comment card if you have to. The important thing is that you can hear from everyone, not just those who happen to participate in social media. 6 The Pew Research Center s Internet & American Life Project s Tracking Survey conducted July 16-August 7,

8 Conclusion Social media is a great way to tune into customer comments. It can also be the ultimate tool for word-of-mouth promotion, allowing your best customers and strongest advocates to share their experiences. But when it comes to your reputation, social media can t create it, it can only perpetuate it. Trying to mend your reputation after someone has posted a negative review is missing the point. Your reputation, after all, is based on the experience people have when they visit your business. That s where survey-based feedback programs still have the advantage. On-premise surveys let you respond to guest comments right away. You can fix problems before they become negative reviews. But survey programs also provide the complete customer picture you need to surprise and delight your customers in the first place. SAN FRANCISCO 125 East Sir Francis Drake Blvd., Suite 300 Larkspur, California p About Market Metrix Market Metrix is the leading provider of customer and employee feedback solutions for hospitality companies around the globe. By connecting feedback with revenue, Market Metrix helps hospitality businesses make smart investment decisions that both improve the guest experience and produce higher profits. Real-time feedback and action management drive timely service recovery, turning potential negative reviews into online raves. And no other feedback program offers the detailed global benchmarking of MMHI, allowing clients to spot gaps and opportunities in the context of key competitors. Market Metrix is essential to more than 14,000 businesses in over 70 countries, and has been helping forward-thinking executives profit from feedback since For more information, visit BARCELONA Rambla de Catalunya, 100, 1º2ª Barcelona, Spain p SINGAPORE 6 Eu Tong Sen Street, The Central, Singapore p