H il to nCRM

C a s eS t u d y

Anqi WangYingyuan Deng

Yueqi MengDongqi Wang

Guoliang Li

Conteet s1

2

3

4

Hilton’s Core Business

Evaluate the Performance of Hilton CRM system

Performance Review and Advice for Decision Maker

Strengthen Hilton CRM

Part 1 Hilton’s Core Business

Start with a Story…

Hilton Hotels

The most internationally

recognizable name in the lodging

industry

Hilton HotelsTimeline

eeee ’eeeeeeeeHilton’s Core Business

1919Founded byConrad Hilton

1964The HiltonHotelsCorporation Is formed, andbecomesthe firsthotel companyto be listed on theNYSE

1954Conrad HiltonbuysStatler Hotel, which at the time was the largestreal estate deal ever

1969The firstDouble-treehotel opens in Scottsdale,AZ

1984FirstEmbassySuitesopens in Kansas City, MOSame yearfirst Hampton Innopens inMemphis, TN

1990The Hilton Garden Innbrandmakes itsdebut

2005HiltonHotelsCorporationreacquiresHiltonInternational

2007Hilton completesmerger withthe BlackstoneGroup’s realestate andcorporateprivate equityfunds

Expansion Strategy

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Franchising & Alignment with Real Estate owners is the only feasible vehicle for fast growth in the capital-intensivelodging industry

4600

Hotels, resorts and timeshare properties

Rooms

100Countries and territories

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One of the largest and fastestgrowing hospitality companies in the world

75800

50000000Members

Multi BrandedPositioning

eeeeeeee eeee eeeeeeeeHilton’s Core Business

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LUXURYFULL SERVICE

FOCUSED SERVICE

Hilton’s Coreeeeeeeee

Service

Massage

Hospitality

Cooperate with local tour agency Airport

shuttle bus

Business center

Fitness center

Pet friendly

Rental Management

Audio Visual Equipment

Car Rental

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S W

T O

Recognizable brand nameDiversified Portfolio

Low Market ShareWeak Management

Competitors: MarriotThe individuation of consumer choiceDownturn in business travel

Digitization and use of technologyInnovation in Customer ServicesDynamic growth in emerging markets

The Customers Really Matter

Part 2

Evaluate the Performance of Hilton CRM system

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Based on Hilton OnQ

Consolidate far-flung customer data

Produce comprehensive arrival reports

100% Internal Source7 Unique Guest Experience

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Competitive Advantage to Competitors

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• Focused on Hilton’s four categories of Best Guests

• Fostering a closer relationship with best guests throughout their lifecycle

• Recognition, Personalization and Customer analytics

Segment customers

Segment sub brands – offer corresponding needs for each group

Segment strategies

Segmentation – Generaleeeeeeeeeeee

• Interaction frequency – best show this customer’s potential value and roughly predict future cooperate possibility

• Check-in Times – recognize the most likely loyal customers

• Online system engagement – easy to promote to

• Customer Value – recognize the most profitable customers

Segmentation – Customer segmentation Principles

Less than 1 Million

1.6 Million

23 Million

Hilton’s four categories of Best Guests

① ② &

④ ③

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① The 8 million active members of the Hilton Honors program

② 4+: Individuals who stayed 4+ times per year

③ Fast Rez: Individuals who signed up for an online reservation account

④ Local VIPs

Three main brands:

Homewood Suites- upscale, yet casual, all-

suite residential-style hotel brand.

- Target Customers: Traveler who want to live in a homelike environment while traveling

Hilton Garden Inn - Highly functional and

innovative facilities hotel with warm and attached staffs

- Target Customers: smart, productive and practical traveler

Hampton Inn - casual, comfortable,

personalized brand that has sincere connection with every customer. Highly value customer satisfaction.

Segmentation – Subeeeeee

e –S t r a t e g y

Recognition Personalization Customer Analytics

Supported by

technology infrastructure

Knowing the customer in person with all the information includes name, recent attainment. Make customers feel being recognized and being welcomed.

Customize the customer’s personal needs. Giving them what they really require but not just service in a general level by collecting information both in advance or inner hotel.

Personalization Recognition

Supporting strategy. Making sure Hilton can quantify the customer data and make quick reactions.

Customer Analytics

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Recognize guests at the reservations center

Print the Best Guests arrival report every morning

The Satisfaction andLoyalty Tracking (SALT) survey

Pre-assign guests to rooms and ensure thatthe rooms were appropriately prepared according to guest preferences

eeeeeeee H i l t o n C R M

99.4% of Hilton Hotel’s Brand Portfolio creates more profits than competitors by 2007

To sum up, Hilton CRM is successful!

Hilton Hotels’ Brand Portfolio (September 2007)

Hilton CRM ensures the rapid expansion and customer services delivery

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1. Information transfer accuracy

Hilton has a large scale in franchise, and the customer information was not integrated and easily available. Since the information system is not totally automatic, there will be a challenge to obtain all needed information accurately.

2. Hard to measure

CRM can be measured but it will be hard to be exact. Unlike quantitative figures, CRM can be measured from both internal and external sides roughly through various channels.

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Part 3

Performance Review and Advice for Decision Maker

Competitive Industry

Occupancy

Worldwide Asia/China

IHG STARWOOD HYATT MARRIOTT HILTON ACCOR

2014 Occupancy Rate of Hotel Industry

Financial Statistics

REV PRF NPR

IHG STARWOOD HYATT MARRIOTT HILTON ACCOR

2014 Hotel Industry Financial Statistics

Net Profit and Growth Rate

Net Profit Growth Rate

Resources From googuu.net

Financial Statistics

Efficiency

Call Center Data Net Revenue per Call Conversion Ratio

2001 $73.09 38%

2002 $77.64 39.1%

2003 $84.39 40.9%

2004 $85.57 41%

2005 $90.30 40.9%

2006 $99.29 41.5%

2007 $102.55 41.4%

Source： from the case

Customer Satisfaction

• “With a score of 78 points out of a possible 100, Hilton took the leadership position…”

--ACSI( American Customer Satisfaction Index), 2006.1

As the data shows, Hilton Worldwide led the industry this year with a score of 80, two points ahead of nearest competitor Marriott International (78)

“This is the fifth consecutive year Hilton has either held sole ownership or shared the Hotels industry lead, according to ACSI data.“

-- By Forrest Morgeson and A.J. Singh

Source： from the case

Further Investment

• Customer Services Efficiency • Customer Satisfaction• Customer Loyalty• Profit• Competitive Industry

Part 4Strengthen Hilton

CRM

1. Optimize internal management

1. Since the information system is not totally automatic, there will be a challenge for information transfer accuracy.

2. The program costs a lot in operation:

93 Million

Total Cost

hardware and infrastructure implementation

application development 40

Million

53Million

Solution to strengthen:Optimize the information transfer structure, improve the joint process between automation and manual work, execute it consistently and flawlessly across the network and reduce the management costs as well.

Challenges:

Recommendation

2.Utilize data to to improve Hilton CRM

Classic web

Browser, Email, links

WEB 1.0Social web

Wiki, Blogs, interactive

WEB 2.0Web of Data

Any media, any place, any device

WEB 3.0

Basic Theory

Utilize data to improve cross-channel application for customer service and experience

PHYSICAL WEB

SOCIAL MEDIA

MOBILECALL CENTER

Social Media

U.S hotel brands increasingly use social media tools to connect customers

1. Attract more new and potential customers to get involved by social media brand promotion.

2. Keep and increase customer loyalty Collect customers diverse comments to track the performance

of current customer service.

3. Improve guest personalized experience by analyzing data.Use data to personalize and provide a list of options within Hilton's capacity.

Recommendation

B I G D A T A

Recommendation

4. Integrate all the data resources from different social media channels to help improve individual customer value management.

• Integrate customer value more effectively. • Multi-channel provides more options for information

acquirement and enlarge customer engagement

MOBILE AS NECESSITY• A user-friendly mobile site and/or

seamlessly integrated mobile brand app are quickly becoming “table stakes” for luxury hotel brands.

• 84% of Luxury Hotel brands now offer a mobile- optimized site experience on smartphones (up from 59 percent in 2014).

MOBILEAPP

Recommendation 1

• Add “Read Reviews” function to enhance interactions with users and collect customer comments.

• Add online videos to optimize customer experience

Improve Self-operated app “HHONORS” to satisfy customer needs and improve customer experience.

Source: Luxury Hotels 2015 (Digital IQ Index)

Recommendation 2 Strengthen the cooperation with online travel mobile apps

• Attract more potential customers and create new customers.• Increase more channels to enhance brand influence.

Thanks!