The significance of CRM to the strategies of hotel companies

Abstract

Purpose

The purpose of this paper is to identify how customer relationship marketing/customer relationship management (CRM) can be a strategic solution to hotel companies or part of their tactics.

Design/methodology/approach

Secondary data from academic and news sources are discussed and analysed, together with empirical data collected previously by the first author during the course of her own doctoral research.

Findings

The essence of a customer‐focused environment is a preliminary indication of how the hotel industry can truly benefit from a strategic and focused approach to CRM. Hotel companies have in evidence had recourse to elements of CRM for a variety of strategic and tactical reasons. It is argued that the success of a strategy depends not only on the ability of a company to identify and understand what its target customers genuinely need and want, but also on the company's ability to deliver enhanced value in terms of these specific needs and wants.

Research limitations/implications

Both the strategic options of a company and the achievement of competitive advantage are directly linked to the elements or features that targeted customers genuinely favour. It is suggested that hotel companies must not only identify what their target customers genuinely seek, but that they should also ensure that they themselves understand the dynamics of CRM as a strategy. Unless the fundamentals of CRM are truly understood, it is argued that hotel companies will not be able to optimally integrate CRM in their strategies and benefit from opportunities.

Originality/value

The research has concluded that hotel companies should decide to focus on customer acquisition, customer retention or customer account development: the three strategies associated with CRM.

Citation

Luck, D. and Lancaster, G. (2013), "The significance of CRM to the strategies of hotel companies", Worldwide Hospitality and Tourism Themes, Vol. 5 No. 1, pp. 55-66. https://doi.org/10.1108/17554211311292448