- Thursday 15 March 2018
Hospitality and tourism is a competitive industry and whilst price is always a consideration, long term success comes from offering better value to customers than your competitive set – to compete on price alone is self-destructive, and nobody wins in the end, including the customer because it is simply impossible to offer the same quality of experience for a lower price over the long term. The ability to create value rarely stems from a single action but is rather achieved through a combination of factors.
How close are you to your customers?
Enhancing the value you offer to your customers is simply not possible unless you truly know and understand their needs, so important sub-questions here include:
- How well you really know your customers’ needs across all segments?
- How good are you at tailoring your offering to meet the needs of different segments?
- How effective are you in managing relationships with those customers?
- How good are your sales people in communicating what you offer in a way that stands above the rest and convinces prospects that your offering is worth the ‘extra’ price you charge?
All of these questions, and others, are vital in terms of determining just how close you are to your customer base.
What can you offer that your competition cannot easily replicate?
There won’t be one answer to this, but it is very difficult to find lasting competitive advantage in product quality alone – product can be more easily copied. So, it’s better to focus on the quality of service delivery – or the people who deliver that service – as being your potential source of real (and hard to replicate value). Really great employees are hard to copy.
How can you offer a better customer experience for the same price?
In line with seeing your people as a source of value for your customers you need to examine every component of the customer experience journey to see where you can enhance that experience. Think of it this way. In any business, the quality of service encountered throughout the experience can fluctuate across a continuum from Service -1 (S-1) to Service +1 (S+1).
When service falls below expectations, we can say that it’s it S-1. We are not talking about poor service here because that is unacceptable at any time, but on occasion, service can be inconsistent. A customer experience at the level of S-1 may not be all bad but it is all a bit hit-and-miss. When service meets expectations, we can call it Standard, or S, and a when the customer experience exceeds expectations it can be said to be S+1. By striving for S+1 you can add-value to your offering by shifting from:
The differences in a customer experience at the level of S+1 from that of S or even S-1 might be subtle, but they are powerful in terms of the impression they make. The S+1 encounter has that little bit extra and although not earth shattering, these ‘extras’ do show a greater focus on the customer and a genuine interest in their custom. Taken in isolation these extras may seem unimportant but when found within the context of a good service experience they have the effect of turning it into a great one – one with true value.
In essence, the service extras which add-value are anything that bring your level of service beyond basic expectations; there are an infinite number of potential extras within the overall customer experience in any business. These can be major or minor in nature and may be relevant to:
- What you offer – they can be major issues when you design certain facilities specifically with guest needs in mind or they can be product/service related when you tailor products to meet specific customers likes and dislikes.
- How you offer them – they can be all the minor things which engaged employees can do to show positive attitudes and to signify to a customer that they are special. These can be as simple as name recognition or anticipating requirements rather than waiting to be asked.
In fact, the majority of extras fall into this category and anytime an employee does that little bit more for a customer, it can be considered as help to create an S+ 1 experience. Equally, the extras can relate to your service goals and steps and how you do things to enhance the customer experience. For example, not having too many bureaucratic procedures or hurdles to be jumped during the service experience can transform how customers view you.
© Dobiquity Limited
