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Hospitality is all about offering warmth to someone who looks for help at a strange or
unfriendly place. It refers to the process of receiving and entertaining a guest with
goodwill. Hospitality in the commercial context refers to the activity of hotels,
restaurants, catering, inn, resorts or clubs who make a vocation of treating tourists.

Helped With unique efforts by government and all other stakeholders, including hotel
owners, resort managers, tour and travel operators and employees who work in the sector,
Indian hospitality industry has gained a level of acceptance world over. It has yet to go
miles for recognition as a world leader of hospitality. Many take Indian hospitality
service not for its quality of service but India being a cheap destination for leisure

With unlimited tourism and untapped business prospects, in the coming years Indian
hospitality is seeing green pastures of growth. Availability of qualified human resources
and untapped geographical resources give great prospects to the hospitality industry. The
number of tourists coming to India is growing year after year. Likewise, internal tourism
is another area with great potentials.
The hospitality industry is a 3.5 trillion dollar service sector within the global economy.
It is an umbrella term for a broad variety of service industries including, but not limited
to, hotels , food service, casinos, and tourism. The hospitality industry is very diverse and
global. The industry is cyclical; dictated by the fluctuations that occur with an economy
every year.
Today hospitality sector is one of the fastest growing sectors in India. It is expected to
grow at the rate of 8% between 2007 and 2016. Many international hotels including
Sheraton, Hyatt, Radisson, Meridien, Four Seasons Regent, and Marriott International are
already established in the Indian markets and are still expanding.

Nowadays the travel and tourism industry is also included in hospitality sector. The boom
in travel and tourism has led to the further development of hospitality industry.
The hospitality industry consists of companies within the food services , accommodations
, recreation and entertainment sectors.
The hospitality industry is a several billion dollar industry that mostly depends on the
availability of leisure time and disposable income. A hospitality unit is such a restaurant,
hotel or even an amusement park consists of multiple groups such as facility
maintainance,    direct   operations(servers,   housekeepers,    porters,kitchen    workers,
bartenders,etc.) management, marketing and human resources.
Usage rate is an important variable for the hospitality industry. Just as a factory owner
would wish to have his or her productive asset in use as much as possible ( as opposed to
having to pay fixed costs while the factory isint producing), so do restaurants, hotels and
theme aprks seek to maximize the number of customers they “process”.
In viewing various industries, “barriers to entry” by new comers and competitive
advantages between current players are very important. Among other things , hospitality
industry players find advantage in old classics(location), initial and ongoing investment
support (reflected in the material upkeep of facilities and the luxuries located there in) ,
and particular themes adopted by the marketing arm of the organization in question
( such as a restaurant called the 51st fighter group that has a WW2 theme in music and
other environmental aspects). Very important is also the characterstics of the personnel
workin in direct contact with the customers. The authenticity, professionalism and actual
concern for the happiness and wellbeing of the customers that is communicated by
successful organizations is a clear competitive advantage.
       In 2003-04 the hospitality industry contributed only 2% of the GDP.
However, it is projected to grow at a rate of 8.8% between 2007-16, which would place
India as the second-fastest growing tourism market in the world. This year the number of
tourists visiting India is estimated to have touchedthe figure of 4.4 million. With this
huge figure, India is becoming the hottest tourist destination. The arrival of foreign
tourists has shown a compounded annual growth of 6 per cent over the past 10 years.

    Besides, travel and tourism is the second highest foreign exchange earner for India.
    Moreover, it is also estimated that the tourism sector will account for nearly 5.3 per cent
    of GDP and 5.4 per cent of total employment.
     GDP Employment Visitor Export Personal T&T Capital Investment Govt. Expenditure
    Outlook for 2006 :- 7.80% 1.40% 10.90% 6.90 % 8.30% 7.70%
Outlook for 2007-2016 :- 6.60% 1.00% 7.80% 6.70% 7.80% 6.60%
    ATITHI DEVO BHAVO (guest is God)- we have all heard this phrase many times
    during our childhood from our parents and grand-parents. We can also find its presence
    in the earliest Vedas and religious epics. Hospitality is deep-rooted in our traditions and
    comes as an integral part of our heritage. In very simple terms, hospitality is the art of
    being warm to strangers and has been derived from the Latin word hospitalitem,
    which means "friendliness to guests". The hospitality industry covers a diverse range
    of establishments in the form of accommodation, food and drinks. It includes hotels,
    motels, restaurants, bars, ships, airlines and railways. The concept of hospitality business
    started when people started traveling away on business and they needed a place away
    from home which could cater to all their needs. Today hospitality has evolved from the
    basic food and accommodation industry and taken a very important position in almost all
    businesses. In fact, it has become a huge industry and drives economies across the globe.
    The scope of hospitality/ service industry today is far more than one could have ever
    imagined a few years back. Earlier people who graduated from a Hotel School could get
    employed either in Hotels, Cruises or Airlines.
    But service is the BUZZ word for all businesses today. Be it the Retail Sector, Banking
    Industry, BPO, Telecom world, Real Estate or any other sector having direct customer
    contact, a person with hospitality background has an edge above the rest, because of their
    sheer capability of understanding the needs of a customer better and handling difficult
    customers/ situations efficiently. Hotel industry depends largely upon the foreign tourist
    arrivals further classified into business travellers (around 65% of the total foreign
    tourists) and leisure travellers. The following figures show that business as well as the
    leisure travellers (both domestic and international) formed major clientele for hotels in
    2004.Over the last two years, the hotel industry has seen higher growth rates due to

greater number of tourist arrivals, higher occupancy rate (being around 75% in FY'06)
and significant increase in average room rate (ARR). The major factors contributing to
this growth include stable economic and political conditions, booming service industry,
FDI inflow, infrastructure development, emphasis on tourism by the central as well as
state governments and tax rationalization initiatives to bring down the tax rates in line
with the international levels.

                         Top players of the industry

The top players in hospitality sector include the following:

   ✔ ITC Hotels
   ✔ Indian Hotels Company Ltd. (The Taj Hotels Resorts & Palaces)
   ✔ Oberoi Hotels (East India Hotels)
   ✔ Hotel Leela Venture
   ✔ Asian Hotels Ltd.
   ✔ Hotel corporation of India
   ✔ ITDC hotels

       Some of the main features of the Indian hotel industry include the following:
   ➢ The industry is more dependent on metropolitan cities as they account for 75% to
       80% of the revenues, with Delhi and Mumbai being on top.

   ➢ The average room rate (ARR) and occupancy rate (OC) are the two most critical
       factors that determine profitability. ARR depends on location, brand image, star
       rating, quality of facilities and services offered. The occupancy rate depends on
       other seasonal factors.

   ➢ India is an ideal destination for tourists. Approximately 4.4 million tourists visit
       India every year. Thus the growth prospects are very high.

   ➢ In the hotel sector, a number of multinationals have strengthened their presence.
       Players like Four Seasons are also likely to enter the Indian market in the near
       future. Moreover, Indian hotel chains are also expanding internationally. A
       combination of all these factors could result in a strong emergence of budget
       hotels, which could potentially lower the cost of travel and related cost.
                   Classification of Hospitality industry

       5 Star and 5 Star Deluxe. These are mainly situated in the business districts of
       metro cities and cater to business travelers and foreign tourists. These are
       considered to be very expensive. These account for about 30% of the industry.
       Heritage Hotels. These are characterized by less capital expenditure and greater
       affordability and include running hotels in palaces, castles, forts, hunting lodges,
       Budget Hotels: Budget hotels cater mainly to domestic travelers who favor
       reasonably priced accommodations with limited luxury. These are characterized
       by special seasonal offers and good services.

       Unclassified: These are low-priced motels spread throughout the country. A low-
       pricing policy is their only selling point. This segment accounts for about 19 % of
       the industry.


The Indian hospitality industry is going great guns presently, with high operating margins
and increase in the number of travellers visiting India - both inbound and outbound.
Thus, the only direction left for the sector points upwards. However, what needs to be
focussed on is the fact that opportunities are not missed, which presently include the large
gaps in rooms supply as compared to demand.

   ➢ India has approximately 100,000 rooms only in totality, which is lesser than that
       in Las Vegas, besides contributing to an insignificant portion of the GDP - just
       5.4 per cent says Sudeep Jain, executive director of JLLM.
   ➢ In comparison to nations like China, Thailand and Malaysia where the hospitality
       share ranges between 12 and 15 per cent, India's growth potential is boundless.
   ➢ "By 2020, the hospitality and tourism sector would be a major contributor to the
       Indian economy," says Jain. South Asia is and will remain a must-visit destination
       and India is looking more and more lucrative.
Within the nation, major contribution as destinations will be from the growing tier I and
II cities with a special emphasis on business hotels across categories as well as the prime
leisure destinations like Goa, Rajasthan, etc, which will remain on the growth path,
creating the aura for India as a leisure destination. Accordingly, the needs of the traveller,
will be nothing less than perfection. Jain says, "They will be more discerning and more
value conscious." With an increase in choices available, they will be less forgiving of
service deficiencies. Guests will require higher levels of service in the full-service
segments, which will warrant greater training requirements for hotel staff. The limited
service hotels will require a complete shift in the perception of customer service.
Nevertheless, this is directly related to the travellers' travel persona. "The same person
will have different standards when he/she is on a business trip, versus an escape with his
partner versus a leisure trip with the family," he explains.

                                  The driving force

Being part of a real estate money management and services company, there are various
driving factors for growth opportunities. It is believed that if the country is able to sustain
its economic growth specially in the service sector, it will have a direct influence on the
hotel industry. This is directly related to the incoming foreign investments, not just in

the hotels but the economy as a whole. Also equally important is the fact that India has
now discovered the power of marketing and with campaigns like Incredible India,
there are also the various large scale regional and global events like the upcoming
Commonwealth Games, Asian Games and the recent Indian Premiere League that builds
interest about the nation. "These are just external factors. The policies and incentives
that will be provided over the next decade could further act as a catalyst to this
industry," . Apart from these external factors there are other factors where the industry
can be given a great boost.
For instance if land prices became more realistic, the process of getting approvals and
licences to build and operate hotels are streamlined, together with strong infrastructure
development and investment and more tax/levy incentives being provided to build hotels,
it would prove very fruitful for the industry. It is believed that there would be no
stopping the growth in the industry if these measures were undertaken. But the fact
remains that half of these changes will only occur if the government begins to take some
proactive measures and provide the much needed stimuli to further accelerate

Challenges For Hospitality Industry

  1. Shortage of skilled employees: One of the greatest challenges plaguing the
     hospitality industry is the unavailability of quality workforce in different skill
     levels. The hospitality industry has failed to retain good professionals.
  2. Retaining quality workforce: Retention of the workforce through training and
     development in the hotel industry is a problem and attrition levels are too high.
     One of the reasons for this is unattractive wage packages. Though there is boom
     in the service sector, most of the hotel management graduates are joining other
     sectors like retail and aviation.
  3. Shortage of rooms: The hotel industry is facing heavy shortage of rooms. It is
     estimated that the current requirement is of 1,50,000 rooms. Though the new
     investment plan would add 53,000 rooms by 2011, the shortage will still persist.
  4. Intense competition and image of India: The industry is witnessing
     heightened competition with the arrival of new players, new products and new
     systems. The competition from neighboring countries and negative perceptions
     about Indian tourism product constrains the growth of tourism. The image of
     India as a country overrun by poverty, political instability, safety concerns and
     diseases also harms the tourism industry.
  5. Customer expectations: As India is emerging as a destination on the global
     travel map, expectations of customers are rising. The companies have to focus
     on customer loyalty and repeat purchases.
  6. Manual back-end: Though most reputed chains have IT enabled systems for
     property management, reservations, etc., almost all the data which actually make
     the company work are filled in manual log books or are simply not tracked.
  7. Human resource development: Some of the services required in the tourism
     and hotel industries are highly personalized, and no amount of automation can
                           THE HOTEL INDUSTRY

What Is Customer Relationship Management?

CRM entails all aspects of interaction a company has with its customer, whether it is
sales or service related. It even uses technology to streamline processes that impact
customer loyalty, service delivery and quality management.

CRM is a business strategy; one that puts the customer at the heart of the business. The
value of a customer relationship is well recognized by many leading companies,
especially by those in the service sector. For high quality hotel enterprises, application of
Customer Relationship Management (CRM) is a great opportunity to increase customer
value and provides a way to systematically attract, acquire and retain customers.
       In the future also, customer relationship management and knowledge
management together will help businesses accumulate customer knowledge build up

better relationships between them and their customers enhance customer satisfaction and
achieve business excellence

         One of the greatest strength is to attention to details, to focus on the bif abd small
little things that make the difference when it comes to comfort, productivity and also the
staff. In CRM the detailed attention is made which is unattended and which can really
reduce the cost.

                                  HISTORY OF CRM
        Following on from Enterprise Resource Planning or ERP (the business strategy
that promised to automate the “back-office”), the term CRM was first coined in the mid-
1990s. CRM in those days referred to the software used to help businesses manage their
customer relationships. From sales force automation software (SFA) that focused on
customer contact management to integrated knowledge management solutions, these
were the early foundations of CRM.
The last couple of years have seen the term broaden to encompass a more strategic
approach and the investment of billions of dollars worldwide into CRM solutions and
services has followed
Customer relationship management is more than the practice of collecting guest-centric
data. It’s the art of using historical, personal, and experiential information to personalize
a guest’s stay while generating incremental revenue opportunities. Knowing a traveler is
an avid sports fan creates the opportunity to market tickets to a game; knowing a guest
had a less-than-memorable experience in the hotel restaurant gives you a chance to win
them back the next time they are in town.
        Microsoft partners have developed a number of leading CRM solutions based on
the latest generation of Microsoft technology. Using the Microsoft suite of applications,
devices, and technology, Microsoft partners can provide you with CRM solutions that
personalize the guest experience and help you generate more revenue.

The Right Technology
        It is estimated that the global market for CRM services and solutions is currently
worth $148 billion. That means a lot of choice when selecting your technology - from
web-based solutions aimed at small businesses with less than 10 employees to solutions
suitable for multi-national enterprises with millions of customers.
I have taken at look at the most widely used solutions and services and listed them in our
CRM Application Guide. Although this is certainly not an exhaustive list, it will give you
a good idea of what’s out there.

The Future
        CRM has already made a big impact in the world of Customer Service and will
continue to do so. As more and more companies become customer-centric those that fail
to do so will lose competitive advantage. As technology increases to develop at a startling
rate the key emphasis will be how we can fully utilize it within our business.
       However let's not lose sight of the fact that Customer Relationship Management is
about people first and technology second. That’s where the real value of CRM lies,
harnessing the potential of people to create a greater customer experience, using the
technology of CRM as the enabler.
CRM may or may not prove to be the answer to providing excellent customer care, but
the philosophy of putting customers at the heart of our business is definitely a step in the
right direction.
Key Benefits
   •   Maintain one set of customer information and make that accessible (role based)
       wherever and whenever it is needed.
   •   Enable to have a 360-degree view of the customer and achieve excellence.
   •   Increase in customer acquisition, retention, loyalty and profitability.
   •   Automate the sales process; increase in number of opportunities through constant
   •   Empower sales team with real-time pipeline and forecasting to direct focus to
       most profitable opportunities.
   •   Quickly identify and provide response to your most profitable customer issues
       and prospects.
   •   Enable marketing professionals to quickly measure response to marketing
       initiatives (Advertisement, Exhibition, Trade shows, Cold calls, E-mails, TV
       shows etc.) Real-time basis and leverage the most successful campaigns.
   •   Achieve customer satisfaction by decreasing customer response time.
   •   Reduce call-handling time by providing knowledge base that incorporates
       powerful search capability in order to quickly locate the relevant data and solve
       customer problems.
   •   Document management saves time in searching the required document when on-
       line with the customer.
   •   Send and receive fax from the application.
   •   Schedules appointments, meetings, calls. Set reminders; keep you alert of all the
       important activities.
   •   Marketing activity reports are available on-line for analysis and immediate action

Some Applications of Technology in CRM

1.  Call centers: These are organizations which deal directly to the customer
interactions. These are otherwise known as "Customer Care Centre" or "Contact Centre"
indicating more technological sophistication and multichannel support. Call centre
technologies entered the market place to effectively alleviate some of the repeat work
and increase efficiencies, allowing companies to handle escalating call volumes.
Customer Service Representatives (CSRs) could look up similar calls and resolutions
while a customer was on the phone, without having to repeat research. The software tools
being     used in the call-centers also provide forecasting of call volumes to ensure
adequate call centre staffing. (Lemon, et al, 2002)
2.  Web based self-service: The customers themselves, without the help of a live person
can resolve their problems or find out answers to their queries using the web. This model
is founded on the principle of enabling customers, partners and employees to obtain
information’s or conduct transactions directly over the internet, avoiding time-
consuming and costly traditional processes involving multiple verbal or written
interactions. It provides control, performance, convenience and efficiency.
3.  Customer satisfaction measurement: Survey mails are the major way for companies
to monitor customer satisfaction. Nowadays, these survey forms are even personalized to
specific customers or customer groups. Responses are input into customer databases and
included as part of individual customer profiles. Such tracking of customer satisfaction
over time enables a company to fine tune how it communicates with its customers
according to their preferences. (Mohan Babu, 2003) Now, the paper based surveys are
giving way to electronic surveys.
4.  Call-scripting: Automatic scripts generated for customer service representatives,
based on an individual customer's segment and/or customer profile contents. Scripts
remove the guess work from determining how to respond to a customer query or
complaint, guiding representatives through a dialogue with the customer and thus
optimizing discrete customer interactions.
5.  Cyber agents: This is a kind of an improved or modified form of the concept of self-
service. Cyber agents are 'lifelike representatives' normally depicted on a company’s web
site as a real person. This attempt to pull together the best of both personalization and
advanced technology. It is given a personality and is having facial expressions and
volume. Usually a cyber agent addresses the web visitor with his/her first name. It can
draw from the wealth of detailed information to answer basic FAQs as well as guide a
customer to the appropriate screen for a definite purpose/action.

6.  Web site: It is the efficient and effective use of worldwide web for providing
information to the customers, by a company who had created that site, in a hassle-free
manner. The main advantage of a web site is its 24 hours accessibility. Usually gathering
information from the site is a simple task and is cost-effective. In the US and in the
developed countries web is extensively used. In the case of monetary transactions, if it is
a high involvement activity most of the customers prefer the offline mode mainly due to
their concern over security problems in monetary transactions, through the net. (Key
Note , 2003)

               CRM IN HOTEL INDUSTRY

Industry Definition

CRM is a business strategy to select and manage the most valuable customer
relationships. CRM requires a customer-centric business philosophy and culture to
support effective marketing, sales and service processes. CRM applications can enable
effective customer relationship management, provided that an enterprise has the right
leadership, strategy and culture.
In hospitality, each customer relationship has value and should be managed effectively.
There is opportunity for repurchase and recommendation from each past customer. The
administration of the information about this past guest and the effective integration of the
information into frontline guest services programs is the challenge of CRM

Tactically, where does CRM start? The recommended implementation of customer
relationship management typically looks like. Statistically valid customer satisfaction
From the very top of the organization, there should be a commitment to CRM including
customer satisfaction, employee satisfaction and a desire to have one voice to the

With the latest offerings in CRM, hoteliers can:
Develop comprehensive guest profiles from reservation information and demonstrate to
guests that the property is in touch with their needs.
Drive guest-centric data down to the transaction level, allowing employees and guest-
facing technology to deliver greater value to the guest.

Generate a realistic profile on the spending and stay patterns of guests, allowing the
property to create guest-centric marketing for increased loyalty and spending.
        It’s All about Technology – Technology certainly plays an important role in the
implementation of a successful CRM project. However, it is not a silver bullet that will
solve all problems or open all doors. It is important to remember that all technology
decisions are only relevant in a business context. All the technology in the world is cool,
but if your business processes aren’t set up to effectively utilize these resources, your
company will be added to the statistics of failed CRM implementations.

Implementing an effective CRM solution is not complex. Adequate planning, effective
communication, stakeholder involvement and mistake avoidance will ensure that your
initiative gets off the ground easily, and places you squarely in the exalted ranks of
successful CRM implementers. The first thing you find when looking into the world of
Customer Relationship Management is the number of different definitions in use today.

                            eCRM or Web based CRM

e-CRM application in hotel industry are straddling across business functions to retain,
capture and capitalize on customer data, i.e. integrating all aspects of business process
and systems by keeping the customers as the core. e-CRM projects are no longer viewed
as stand-alone implementations but are now being increasingly pursued in context of
larger business objectives and core strategic agendas. Corporations realize that the true
values of their customers in down turn are the ones that will be equipped, tied over the
slump and jump start, consolidate and thrive.

                    e-CRM Components in Hotel Industry

   •   Sales functionality: Contact management profiles and history, account
       management including activities, order entry, proposal generation

   •   Sales management functionality: pipeline analysis (forecasting, sales
       cycle analysis, temporary alignment and assignment, roll up and drill
       down reporting).

   •   Telemarketing/Telesales functionality: call list assembly, auto dialing,
       scripting, order taking.

•   Time management functionality:         single   user   and    group
    calendar/scheduling, e-mail

•   Customer service and support functionality: incident assignment,
    escalation, tracking/reporting, problem management/resolution, order
    management/promising, warranty/contract management

•   Marketing functionality: campaign management, opportunity
    management, web-based encyclopedia, configuration, market
    segmentation, lead generations/enhancement/tracking.

•   Executive information functionality: extensive and easy-to-use

•   ERP integration functionality: legacy systems, the web, third party
    external information

•   Data synchronization functionality: mobile synchronization with
    multiple field devices, enterprise synchronization with multiple
    databases/application servers

•   E-commerce functionality: manages procurement through EDI link
    and web-server and includes B2B and B2C applications

•   Service support functionality: Worker orders, dispatching, real time
    information transfer to field personnel via mobile technologies

Customer Relationship Management Software for the
                  Hotel Industry

Guest Ware is a unique Customer Relationship Management System (CRMS) designed
specifically for the lodging industry to provide personalized guest recognition and
exceptional service quality. Leading hotel management companies use Guest Ware to
improve guest satisfaction, lower operating costs, build guest loyalty, and increase
revenues. (

Guest Ware is installed in over seven hundred hotels and resorts worldwide; including
Marriott International, Kimpton Hotel Group, Hyatt Hotels, Star wood and many
independent hotels and resorts.

Marketing Solution - The CRM Approach
Now more than ever, it is critical for hospitality sales and marketing professionals to
maximize their return on investment (ROI) in marketing. Experts agree targeted
marketing to existing customers is the best way to increase marketing ROI. Most industry
consultants estimate the cost of finding a new customer is between 5 and 10 times the
cost of retaining an existing customer.

Improvement Analysis - Implement Process Improvement
Industry surveys show that guests are less likely to return if they experience a problem
during their stay. Guest Ware’s Improvement Analysis tools provides with the
information to eliminate recurring problems and keep guests coming back, so to lower
operating costs and increase guest satisfaction at the same time.

Comment Card Tracking - Listen to your Customers
Customer survey on restaurant or an extensive questionnaire of guests, the GuestWare
Comment Card Tracking system assists to manage customer feedback. Guest Ware will
improve productivity in the follow-up process and provide valuable management reports
to maximize the benefits of your surveys.

Guest ware Enterprise Solution – For Effective Means
Intended for hotel chains, brands and management companies, the Enterprise Guest Ware
database maintains a single view of the customer essentials for CRM. Enterprise Guest
Ware enhances property management systems (PMS) and central reservations systems
(CRS). It allows hotel companies to implement enterprise CRM while leapfrogging
existing hotel technology investments.

Communications Server - Two-way Messaging
The Guest Ware Communication Server integrates two-way messaging (or other types of
text-based messaging) with Guest Ware’s Rapid Response. It allows staff to receive and
close requests and maintenance issues from a pager or cell phone. The software helps
streamline service delivery and uses existing e-mail systems or a modem to communicate
with most two-way messaging devices.

With the latest offerings in CRM, Hoteliers can:

   •   Develop comprehensive guest profiles from reservation information and
       demonstrate to guests/customers that the property is in touch with their needs

   •   Drive guest-centric data down to the transaction level, allowing employees and
       guest-facing technology to deliver greater value to the guest/customers.

   •   Generate a realistic profile on the spending and stay patterns of guests, allowing
       the property to create guest-centric marketing for increased loyalty and spending.

ITC Maurya Sheraton - Field selling, Loyalty programs, Reservation systems, Web &
Call centers are the major sources of database development. The hotel has 35,000
members in its database. They regard this management of their database as an asset
because it enables a superior customer understanding.

Using the Database:
Product and service improvement is just one result of tapping into a database.
Developing special promotions and employing direct mail to promote these campaigns is
another major use of database marketing.

For example: A sales team of Mughal Sheraton, Agra had completed a review of an
upcoming weekend. This review revealed that bookings to date were some what below
forecast and that a special promotion may be done in order to speed up the business. The
sales team then enveloped special promotion packing to encourage bookings for
weekends. They searched their welcome break holiday package database and scratched it
to identify and segment the customers who tend to (Sheth, 2002):

    • Book on long weekends
    • Book on a short term basis
    • Respond to promotional campaigns
The direct mailing was used as a principal means to reach out to these customers.
Activities like these are today referred to as database marketing. It is aggressive selling
to the potential customers who have particular needs and wants and building a match or
“fit” the needs of the noted. Therefore, out of the database of 35,000 members, only a
few but almost some customers were contacted by direct mailing which resulted in
sizeable sale during the otherwise lean weekend at Mughal Sheraton Agra.

Database Mining
Starkov, (2006) points out that Database mining is the process to distill the target
customers groups out of the massive data files typically found in hospitality operations.
In other words, these are systematic ways to distill through a database of a multitude of
databases to get the information for which one is reaching.
Some hotels outsource these tasks to companies that specialize in this field or at best, do
it internally. It enables users to easily integrate company/ property management
reservations and point of sale systems, automatically extracting operating data from
legacy databases for use in the marketing database. The systems analysis tools allow
users to profile their most profitable customers, analyze their buying habits, develop &
assess the performance of targeted marketing campaigns. The biggest advantage of
database mining is that it helps to focus the efforts and available resources into one
direction which is most profitable and out-base mining helps to eliminate the non-
profitable customers and hence reduces the costs and enhances the profits. The profits
enhanced are not only in monetary terms but also in terms of customer loyalty and long
term retention. Companies in hospitality that are adopting the database marketing
approach to enhance sales are seeing increased customer satisfaction which further results
in increased revenues. From the point of view of the internal customers also, a new
profession is emerging in the hospitality industry of getting and keeping a customer.

Relationship Marketing
Rama (2005) suggests that frequent customer programs and database marketing efforts
contribute to a more comprehensive approach to satisfying customers called relationship
marketing. Relationship marketing depends on the goodwill generated by frequent-
buying programs as well as on the information provided from database marketing efforts,
goes beyond simple short term awards and involves all the elements of a firm’s and
services to encourage a personal relationship with each customer. Relationship marketing
is “knowing the customer and using that information to bond with them.” Form the initial
personal contact and then serve as the foundation for nurturing this brief encounter into a
friendly and accommodation relationship by focusing on personal guest information. In
addition to knowing the purchase habits of members (room selection, certain amenity
preferences, and so forth), personal information such as spouse’s name and hobbies are

added to a member database The company uses this information to tailor special events
and products to small segments of the membership.

Complaint Handling
Few companies, use or pay attention to complaints. Who wants to hear what they’re
doing wrong, especially if the criticism is well founded. It is estimated that 90 percent of
dissatisfied customers whose problems were not solved will never do business with the
retailers that sold them the product nor will they again buy the product that caused the
problem. In case of hotels customer/guest is more likely to switch if the provided service
is not satisfactory to their expectation.

On a personal level we all know what our faults are but we get defensive way they’re re
pointed out. We’re also aware of weaknesses in our job performance, problems in our
organization and imperfections in its products and services. But reacting to criticism is
difficult. We tend to respond in a guarded and defensive way, which may avoid squarely
confronting the real problem. Likewise, companies tend to let themselves off the hook
too easily: “We never could have satisfied that customer.” (Schneider and Bowen, 1999)
The astonishing news is that those people who do complaint and have their problem
taken care of, tend to be more loyal to the company than the people who were satisfied in
the first place. World-Class companies see complaints as opportunities to improve, to
impress customers and to turn complaining customers into loyal ones.

Priority Marketing
Priority Marketing focuses on what’s important to the customer. What is important to one
customer however, may not be as important to another.
Consider the varying demand placed on a hotel: An airline stewardess may find the 24
hour room-service extremely valuable, a retired couple may need dietary menu options, a
tour wholesaler may favor low prices, and a young female executive considers a security
a priority.
Hotels should break down their services and ask customers what is important to them.
This approach can field very valuable insight about changing customer preferences.
Identifying groups of customers who have similar preferences or even similar tastes (such
as sharing common perceptions of quality or states), hotels can target promotions to
capitalize on known characteristics and individualize the presentation.
It is important that hotels involve their guests and stay in touch with customer
perceptions of current services.


    Customer          Pre-sale           Sale           Routine Post-      Non-routine
    Research          Interaction        Transactio     sale               Post-sale
                                         n              Interaction        interaction
    Consumer          Comparison         Order          Routine            On time/ End
    Buying            of Hotel           placing        information        time
    behavior          products           Payment        sharing (new       settlement
    Payment           Customizatio       Order          ces, advisory      Claims
    patterns          n of products      processing     services etc.)     processing in
    Consumer          Clarification      Payment        Investment
    Profiles          of FACs and        Processing     specific
                      specific                          information
                      queries                           sharing

    Accuracy          Decision           Speed          Speed              Accuracy
    Comprehen-        Making             Accuracy       Transparency       Fairness
    siveness          Customizatio       Delivery                          Speed
                      n                                                    Transparency

Source : Raghunath S., Joseph Shields (2001, "Introduction of e-CRM in Indian Hotel Industry, CRM
                                                         – Emerging concepts, Tata McGraw Hill,).


“Customer Relationship Management is a process of managing customer relations in
an organized way”. They aim at managing each “Moment Of Truth” that is
experienced by the customer.

There are various contact points where the hotel comes in direct contact with the
customer which are known as ‘Touch points’ in the CRM language. These touch
points are considered important as there is direct interaction with the customer and
they provide valuable input to the hotel. The input provided by the customer has to
be captured in such a way that it becomes information and can be used by various

processes within the hotel. This can be done with the help of technology and the aim
is that whenever there is a customer interface with any of those processes they are
able to use that information in servicing the guest in a most efficient manner.
Customer Service is now more fashionably called Customer Relationship
Management. ITC Maurya Sheraton has been following an unstructured form of
CRM with a narrow focus of serving the customer well and in a most efficient
manner. The concept of Customer Relationship Management has a broader focus of
not only serving the customer but also creating the customer and retaining him for
measurable and substantial returns. CRM is a vast subject where the concept of one
to one marketing is supported by Database Marketing.

CRM process at ITC Maurya Sheraton has been divided in 2 steps:-

   1. Identification of all Customer Relationship management ‘vehicles’
   2. Integration of these Customer Relationship management ‘vehicles’


Maurya Sheraton has identified 5 such vehicles (from marketing point of view) which
are also the touch points for the hotel in the process of managing its Customer
Relationship. These vehicles are:-

   ○   Field selling
   ○   Loyalty Programs
   ○   Distribution Points
   ○   Web
   ○   Call Centers

Field Selling
When a sales group or a marketing executive of the hotel makes a sales call to a
corporate, then it is called Field Selling. Field Selling includes Prospecting which
means searching and seeking for new customers. Current Accounts are one of the
best sources to uncover new business that is within these current accounts, as they
harbor many sources of untapped business potential. They also provide Leads and
referrals. Leads are potential customers with whom no contact has yet been made and
learning of potential customers from current customers is called Referral. Field

selling is considered the most important vehicle for the CRM function as the initiative
is on the part of the hotel to contact the prospective guest. Since the representative of
the hotel meets the customer personally, he is able to strike a chord instantly and has a
fair chance of representing the hotel. The difference between the customer and
consumer is apparent at this stage as, the person who uses the hotel is a consumer
(guest) and the person who helps him make this choice is the customer (link), this
link, in most cases, is the administration personnel who are responsible for making
reservations. So with the help of field selling, the executive is able to make a direct
contact with the ‘link’, the administration person and is able to take the feedback on a
continuous basis and helps to customize the offering. The main objective of this is to
maintain ‘one to one’ contact with the customer on a regular basis and also to
maintain reasonable visibility so that whenever there is a requirement, the hotel is the
most obvious alternative for the customer to consider.

Loyalty Programs

Second vehicle for CRM identified by Maurya Sheraton are the Loyalty Programs.
These programs are designed to reward the loyal guests of the hotel. Every time a
guest checks in the hotel at his every touch point or interface with the hotel, every
time he spends on a service provided by the hotel (use of Room, Restaurant, Laundry,
Telephones etc.), the transaction is recorded at each individual point and is added to
the final bill presented to the guest at the end of the stay. There are certain points
attached to the number of rupees spent by the guest. Therefore higher the amount of
the bill, the higher will be the number of points attained by the guest. These points
are credited to the account of each guest with the help of technology. These are called
Loyalty points. These accounts having the loyalty points are unique to every guest.
Therefore, whenever after the first time that guest checks into the hotels, the guest
history also affects the loyalty points. The higher the number of points, more loyal is
the guest. The points can be redeemed by the guest for either free stays at the hotel or
free gifts as listed by the hotel or free meals depending upon the number of points
The objective of having a loyalty programme is not only to make the guest feel
rewarded for his stay but also providing a chance to the guest to reduce them at the
hotel, they essentially “gross self” the other services which would be used & paid by
the guest. In case he redeemed (for example) his points for a free stay, he would
spend on the supporting services like laundry, telephones, restaurants etc. and the
revenue generated from these could be earned by the hotel. Therefore, instead of loss
of revenue by providing free stay, they actually gain the revenue as well as certain
customers for life with the help of the loyalty. The Loyalty Program is called
welcome avail which is for the consumer. They have another loyalty programme for
the link. The administration personnel, who is called welcome link, is motivated to
provide more business to the hotel. Therefore, the more the number of bookings the
links gives to the hotel, the more number of points are credited to his accounts which
are again redeemable at the hotel either by way of free stay or gifts. This is seen as an
important way to keep the source of business motivated towards a long term

Distribution Points/ Central Reservation System
A customer can simply make a call at the reservation centre to make a booking with
the hotel. It sounds simple but it could get complex in case he does not receive the
expected or the desired response. Therefore, Maurya Sheraton sees this distribution
point as an opportunity to establish CRM as the respondents at the reservation centre
could turn a prospective customer into a ‘sale’ or could let go off the opportunity to
do so by not being polite enough or not giving out the information as desired by the
guest. The information regarding all guest reservations is managed through computer
software, therefore, when a customer make calls to query about a reservation, all his
hotel usage history pops up in the system which gives a chance to the executive at the
reservations to instantly recognize the customer and address him by his name. T

his moment of truth is experienced by the customer with a feeling of recognition and
feels it as good service at the first touch point itself. The input or instruction received
from the customer at the stage is recorded in the reservation system for further
reference by the hotel operations. Therefore the wheel does not get reinvented every
time a standard instruction is to be followed. This leads to removal of an irritant and
that ultimately leads to a satisfied customer willing to return.

World Wide Web
The World Wide Web is part of the internet. It is a computerized, interactive,
multimedia system to import and/or access information world wide. It is used for
both personal and business purposes. But ITC Maurya’s focus is on the business side
of using the web. In hospitality, there are several avenues that one can take up to set
up a web site to share information and do business with a potential customer. Since
the web gives a convenience and allows the access to information at any time, it is
considered as one of the vehicles for CRM. Though Maurya recognizes the potential
of this system and is in the process of evolving a filing automated system where the
reservations can be made by the customers on time and also the confirmation is
received back on a real time basis. Presently they have an information portal which
only allows the customer to request a reservation which has to be checked manually
by the hotel reservations and then only the confirmations are given. This is a touch
point of customer relationship because a speedy and accurate response could win you
a customer. And since it is on an individual basis, it is more personalized and
customized because the customer puts in his preferences when requesting a booking.
Therefore, once it is entered in to the hotel’s data base the customer does not have to
repeat his preference as they are automatically suggested by the reservation form on
the net.


                    THE PRIDE HOTEL

              The Pride Hotel is one of the best luxury hotels which possesses unparallel
elegance and grace. it is a world-class five star hotel, They provide finest amenities and
accommodation, exotic cuisine at restaurant with bar, state-of-the-art conference hall and
banquet hall to host any occasion. Blending sophisticated urban flamboyance with a
relaxed attitude, hotel is ideal for an enthused business trip, social events, or indulgent
escape from the chaos of the city.
        The rooms are of three types and when we asked them about the rooms they
replied as below:

        These rooms are designed with a royal finesse, this exquisite Royal Suite is to
pamper customer completely. Whether customer is on a social visit or on a holiday,
customer can unwind themselves lavishly. Have a look at the suite and customer would
not like to go for an alternative”.

Superior Room
        Traveling on business trips can be clumsy & tiresome. Here is what customer can
look forward. A spacious contemporary suite to rejuvenate customer senses along with
giving them the best of business amenities. Work, Relax - the suite can surmount all your
needs graciously.
Deluxe Room
       Have frequent business visits & desiring the solace of your home? Check out this
Deluxe Room. Having essential business aids, this room is expediently designed to make
your business trip full of leisure

ROOM CATEGORY                                              SINGLE
                                INR                             US$
DELUXE                          8000                            220
SUPERIOR                        9000                            250
SUITES                          12000                           325


        The 24 hrs Coffee shops serve delectable cuisines from across the globe and are
the perfect place for a quiet rendezvous or dining out with family and friends.

          Savor the essence of royalty at Bandhani, our fine dining multi-cuisine
restaurant. The display kitchen is a visual treat to see the exotic specialties created by the
experts themselves. Culinary traditions of most exotic and exciting cuisines of the world
are characterized by subtle spices and delicate flavors. Whether you are looking for
Indian, Chinese, Thai or Continental, we have it all there for you. To add to the
excitement, a live band would be playing your favorite numbers. If it is celebrations, it
has to be here.


      It is the mocktail lounge bar. It is the only place where there is karaoke, hookahs
and exotic mocktails. And a DJ is also there to play customers favorite tracks

       There are 6halls in all which can in all conveniently accommodate up to 1200
people for wedding receptions or from 25 to 800 people theatre style from seminars and
conferences. The Imperial, Royal, Majestic, Chancery Halls & Board Room offer
exclusive layouts & latest gadgets to give you truly memorable conferences, seminars,
weddings or parties


Swimming pool and health club, in house laundry, travel desk, business center.

1) Airport transfers
2) Welcome drink on arrival
3) Fruit basket on arrival
4) Buffet breakfast
5)24 hour room service
6) Refrigerators in all rooms
7) hair-driers in all rooms
8)24 hours in house satellite TV channels
9) Direct dial STD/ISD
10) Internet connectivity in all rooms
11) Tea and Coffee maker

Majority of the customer are for business purpose because there are very few places to
visit in Ahmedabad so mostly people come for the business purpose.



Pride hotel provide membership to all those who visit their hotel frequently or vise versa
u can say that those who become the member of the hotel become its loyal customers.
There are basically 2 types of membership silver and golden and different offers are there
for different types of members. There are in all 2000 members which are day by day
increasing and front that 1100 holds gold card and 900 holds silver card

You will get various discounts which are as follows if u are a silver member of the hotel.
These all will be provided in the form of vouchers of Rs. 29999.

   1) The member would get the discount on food if he goes with 2 more members.
   2) Complementary cake on your birthday or wedding if u celebrate in pride
   3) A reduction of Rs. 500 in the meal at Bandhani restaurant in Ahmedabad
   4) 20% discount at all the pride hotel of India for accommodation on week days and
      30% discount on weekends
   5) Complementary room for night stay at pride hotel for one person and 40%
      discount for two.
   6) By paying the rack rate they will be allowed to shift or upgrade the superior
      category of the room
   7) Free usage of swimming pool, 20%discount in health club.


He becomes the gold card holder if he pays the amount of Rs. 49999.
   1) You are entitled to special holiday at 3700 RCI affiliated resorts across the world
      for 2 days and 3 nights.
   2) 50% discount on food and beverages.
   3) Free usage of swimming pool and 50% discount on health club
   4) They will send a cake on the day of wedding anniversary or birthday if they are in
      the any of the cities where pride is located.
   5) They will get a voucher of Rs. 900 for meal at Bandhani restaurant in Ahmedabad
   6) 40% discount at all the pride hotel of India for accommodation on week days and
      50% discount on weekdays
   7) Complementary room of your choice for night stay at pride for 1 person and 50%
      discount for 2.

Even though pride is far from that of the airport more foreign visitors are there in pride as
compare to the comfort inn and the main reason is its location which is in the middle of
the city an other important reason is its quality relation they have kept with their

    1) Pride hotel has its own small call center at satellite from where they call and
        invite the customer to visit their hotel.
    2) Birthday and wedding anniversary wishing through calls and e-mails.
    3) Free airport facilities are provided specially to the loyal customers at their prior
    4) Greet the customer with name
    5) There are 2 rooms which are kept specially for the card holders if they come
        without any prior intimation
    6) If the customer every time prefer the same room and his visits are also at certain
        period of time then at that time they call them and ask for their visit and keep that
        room block for them.
    7) Also they have a children’s room for the Childers of the member person. They
        can enter the room after showing the card.
    8) And also at the time of Navratri they give the passes to the foreign customers.
        This is offer especially for the foreign loyal customers. Some time they also give
        tickets of movies also
    9) They also have a travel agent who is available 12 hours every day of year to
        provide knowledge regarding the places of the city and take them there if
    10) CUSTOMIZED SERVICE: One person of the staff is always there on every floor
        and the moment they need the person is there in front of the customer’s door.


1) Information regarding the customers are taken at the time of checkout because they
think that in the beginning customer must be tired.
2) all the staff is given training before joining the hotel. A receptionist is given training of
40 days while 15 days to the house keeping person


           Customer Profiling

An Overview of the Software used in Hotel
   Industry for Customer Relationship

Objectives of the Study

The primary objective would be:

   • To study “Customer Relationship Management in the Hotel Industry”.

The other objectives would be:

   • To study the programs and practices of CRM employed by the leading
     hotels in India.
   • To study the measures to build a better relationship between the
     customer/guest and the hospitality unit.

Scope of the Study

This study will provide an insight into the hotel industry and the steps
being taken by them to improve their relationship with their
From the study, one can infer the present scenario of the practices and
programs being followed by the leading players in this sector and the steps
being followed by them to enhance customer retention, customer satisfaction
and in turn, leading to enhanced profits and brand image in the minds of the


A survey was conducted with a sample size of 30. The age of all the
candidates was between 20-35, of which 12 were females and 18 were
males, the statistics of their occupation and annual income is as follows.


                                ANNUAL INCOME


Dear Sir/Madam,

         We the students of IILM, Gurgaon are conducting a survey on the “Customer
Profiling “Customer Profiling process for Hotel Industry in NCR”. Your support in
filling this Questionnaire will be highly appreciated and the data or information obtained
herewith will be used for academics purpose only. Thank you for your support in our

Personal Detail:-

Age:- □ 20 – 35       □ 36-50
      □ 50 -65        □ Above 65

Gender: -       □      Male        □ Female

Occupation: - □ Business             □    Professional
              □ House wife           □    Other_______________

Annual Income (in Rs.):-      □ Below 2, 00,000          □ 2,00,000 to 5,00,000
                                 □ 6, 00,000 -10, 00,000      □ Above 10,00,000

City:- ______________________________
State:- ______________________________

(1) In which hotel of NCR do you prefer to stay?
        (a) Hotel ITC
        (b) Crowne Plaza
        (c) Park Plaza
        (d) Bristol Hotel
        (e) Others__________________________

(2) What are the facilities provided by the hotel?
      (a) Choice of Room
      (b) Choice of Food
      (c) Transportation Facility
      (d) Online Registration
      (e) Conference Room
      (f) All of them

3) How frequently you visit this hotel in a year?
      (a) Less than 3 time

        (b) 3 to 5 times
        (c) More than 5 times

 4) The purpose of visiting NCR?
        a) Business
        b) Holidays
        c) Professional commitment

 5) What are the reasons that lead you to stay in particular hotel?
   (Rank it from 1 to 7 where 1 is for least relevant reason and 7 is for more relevant
                a. On time service               _
                b. Quality of service             __
                c. Employee’s Behavior             __
                d. Ambience                      __
                e. Tariff                         __
                f. Facility                       __
                g. Convenience                    __

 6) How they recognized you as a loyal customer?

 7) What are the extra services you get in your preferred hotel?

 8) Do you get any kind of discount?
     (a) Yes         (b) No

(9) How satisfied are you by the overall hospitality of your preferred hotel?

        a) Highly satisfied
        b) Satisfactory

    (10) Being a loyal customer have you been given preference over the other
          a) Yes
          b) No






   ROOM         FOOD        ROOM          REGISTRATIO




To this question most of the people mentioned that it is through their guest records and
recognition software that they identify a regular guest and depending upon the number of
times of your visit and potential of a future revisit they tag you as a loyal customer.


   •   Free safe deposit lockers
   •   Full-equipped Business Centre
   •   Knight Rider on-line service
   •   Arrangements made for golf and tennis
   •   Beauty shop
   •   24-hour fax/ telex facilities
   •   Secretarial service
   •   Currency Exchange
   •   Doctor on call
   •   High speed internet facility.





From the data collected we have reached a conclusion which states that Hotel Pride
(GLORIOUS GROUP) has a better CRM system over the Hotel Maurya Sheraton( ITC
   • Customers prefer it for the choice of food over others.
   • Frequency of customers visiting this hotel is also higher.
   • Customers visiting NCR prefer this hotel for a perfect Holiday stay.
   • The quality of service provided by The Pride Hotel is also highly satisfactory.
   • The extra services such as 24*7 high speed broadband service and provided by
       the Pride Hotel are also superior to others.
   • The preference is given to loyal customer over other customers.

       All in all facilities provided by HOTEL PRIDE (GLORIOUS GROUP) is highly
       satisfactory as compared to MAURYA SHERATON (ITC GROUP)

In this era of globalization where ‘Customer is the King’, customer expectations are
going up which is making the situation more and more competitive. As the product is
becoming generic in nature, the hotel industry can no longer rely on the traditional
marketing strategies to retain the customers.

Customer Relationship Management is one of the key tools to fight this cut throat
competition and stand out as a superior brand.

On the basis of the study, I would like to recommend some suggestions which could
be implemented profitably by the industry.

   1. Surveys: Conducting monthly guest/customer surveys, club surveys, room
      comment cards, toll free guest assistance centers can help in getting customer
      feedback and to improve in the areas where there is a lag as suggested by the

   2. Maintaining suggestion boxes at every touch point/point of interaction with
      the customers.

   3. Taking feedback not only from external customers but also the internal
      customers i.e., the employees.

   4. Proper check on the hotel staff’s and processes’ efficiency by the
      management, say by employing Mystery Customers.

5. Keeping regular track of the sales data for further leads and follow-up

6. Employing effective CRM software to improve guest satisfaction, lower
   operating costs, build guest loyalty, and increase revenues.

7. Having Guest History programs- keeping a databank of customer profiles
   along with such details as room preferences, amenities preferred, special
   requests, meal preferences, wallet services, sending birthday cards to the loyal
   guests and even their spouses and giving them a hassle-free check-in
   procedure-like sending them pick-up and drop facilities.

8. Employing an efficient system of complaints handling as complaints are the
   opportunities to improve, to impress the customers and to turn complaining
   customers into loyal ones.

9. Giving recognition awards to attract old customers.

10. Giving the customers a more personalized and empathic services as building
    good rapport with the customers goes along way in having satisfied and return


Jay Curry (2006) - Key to CRM Success for Small and Medium-size Enterprises, from

Rama Mohana Rao, K. (2005), Services Marketing, Pearson Education



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