The Alcatel report suggest the following uses; (Alcatel-Lucent Enterprise, 2011)
“Dwyer (2007) demonstrated the impact of social networking sites on developing customer interrelations and communities. In their study of video tags on De.Li.Cious, Paolillo and Penumarthy (2007) found that social tagging can generate community benefits such as; easy retrieval (as users use words they can remember and have useful meaning to them); information contribution and sharing; attracting attention; opinion expression; playfulness; and self presentation. Thus, since tagging can be used for providing users with functional services , with tools for creating social ties and conducting , market research on users’ opinions and interest, and WOW, social tagging ability in creating user communities is evident.“
As this already exist and is something that is happening with or without the company’s involvement. However, to facilitate this and to be part is important. According to the Alcatel report (2011) especially due to the nature of the hospitality, “it is an excellent way to connect to consumers and guests through company pages, Facebook, Facebook ads, Facebook sponsored stories, etc.” (Alcatel-Lucent Enterprise, 2011)
“The role of online communities in supporting CRM practices along the customer lifecycle phases (Table 3). Wang and Feisenmaier (2004) illustrated that virtual tourist communities are useful for managing customer relations by: attracting customers through in-depth, focused and member generated content; engaging customer through social interactions; and retaining customers through relations building with other members.” (Sigala, 2010)
“Online communities also build customer value (Wang & Feisenmaier, 2004) by generating users with all types of relational benefits namely functional, social, hedonic and psychological
(Gwinner, Gremmlerm, & Bitner 1998). Andersson (2005) explored the use of online brand communities for developing interactive communication channels and establishing social and structural bonds with devoted users. Jang, Ko, and Koh (2007) showed that online communities develop and possess features – such as quality and credibility of information, service quality, member interaction and leadership, brand reputation and (intrinsic and extrinsic) rewards for member activities – that in turn contribute to increased users’ brand loyalty, commitment and sales” (Sigala, 2010)
“Findings also show that hotels should try to enhance and provide more eCRM features for boosting the emotional and social appeal of eCRM, i.e. creation of online guests’ virtual communities, guest forums, and chat facilities. This is important because by increasing guest recognition, identification, and attachment with a community, the hotel can make it more difficult for guests to change hotels and/or to evaluate hotel alternative based on only price.” (Sigala, 2006)
By testing the model, evidence was provided that customer’s evaluation of eCRM practices is significantly reflected on six critical eCRM factors of website features and functionalities.” (Sigala, 2006):
“It becomes clear how these six critical eCRM implementation factors can have a positive influence on e-service quality by: enhancing the quality and appropriateness of information provided to customers; enabling faster and reliable online transactions; enhancing website interactivity and flow that, in turns, create positive emotional and aesthic customer feelings; increasing the empathy received by customers in term of responsiveness, online user recognition, customization of products, services and information to the CRM member profile, etc.” (Sigala, 2006)
By developing relations with firms’ in an internet environment, Colgate et al. (2005) also found evidence that customers perceive enhanced history benefits (referring to the long-term association and familiarity with the company and customer needs) as well as personal service benefits (referring to the opportunity to receive the highest service, personalized service and quick problem handling.) (Sigala, 2006)
“In order to ensure that eCRM will positively impact e-service quality perceptions, eCRM practices should first try to create and build trust and commitment between firms’ and customers’ relations.” (Sigala, 2006) However, trust is not an easy thing to establish in any relationship, personal or in business and it takes time. However, as Sigala (2006) is arguing, “building trust in an internet mediated environment where face-to–face encounters are not possible is not easy.” (Sigala, 2006)
”While social media cannot replace traditional concierge service, it is a promising way to address the issues of increasingly technology savvy guests.”
“According to Mashable, the top source for news and digital media, technology and web culture, “a concierge with a Twitter feed could be a powerful thing. Instead of making a single stop at the concierge desk to collect brochures,, guest could ask questions before they get to their hotel, from their rooms, or while they’re out exploring. They would also have easy access to the questions other guests asked and past recommendations”” (Alcatel-Lucent Enterprise, 2011)
This is where the largest potential for profit is and it also creates a tremendous opportunity to be a new revenue stream is when connected to an eCRM strategy. One way can be to combine this with last-minute and promotional drives using the same facilities already implemented, as e-commerce solutions or booking engines. Making them exclusive and just limit them to a certain period in time for loyal customers does not demand a lot of time or resources and but will create good customer value.
Research findings by Sigala (2006)”reported that eCRM enables guests to make online bookings and transactions easier and faster, as well as personalize their hotel experience and service by adapting them to their own preference and profile.” (Sigala, 2006)
“Bill Carroll, a senior lecturer at the school of hotel administration at Cornell, sees a great opportunity within the “intersection of social media and mobile,” especially related to mobile geo-location features.” (Alcatel-Lucent Enterprise, 2011)
“Foursquare is important to those in the hospitality industry because guests often “Check-In” to different locations in Foursquare. A high number of foursquare check-ins can often indicate the popularity or relevance of such a place.” (Alcatel-Lucent Enterprise, 2011)
“According to USA Today’s section on travel, hotels increasingly tout deals on their Facebook pages. But more than just giving discounts to Facebook fans social media provides a way to push last-minute deals.” (Alcatel-Lucent Enterprise, 2011)
“The customer service capabilities of social media networks like Facebook and twitter are vast for the hospitality industry, and are now increasingly indicative of how good a hotels customer service is.” (Alcatel-Lucent Enterprise, 2011)
“It is proposed by (Sigala, 2006) that future conceptualization and examinations of service quality should consider the following:”
“It has been widely suggested (e.g. Colgate, Buchanan-Oliver and Elmsley 2005) that there is a synergy between the functionality of the internet and the implementations of CRM” (Sigala, 2006)
“As service quality is a customer-centered concept Sigala (2006a) advocated that CRM processes need to be also centered on customers’ problems and issues. In this vein Sigala (2006a) developed a customer orientated eCRM implementation model that clearly illustrates how eCRM web features and processes can be designed to directly support customers at every stage of their online purchasing transactions and experiences.” (Sigala, 2006)
“Guests also reported that the eCRM enabled them to carry out this task in their own time, place and convenience. This functional convenience of eCRM enhanced guests’ service quality perception in terms of their availability, responsiveness, and accessibility.” (Sigala, 2006)
“Guests also reported positive social and emotional feelings when using eCRM, such as being personally recognized and greeted online, receiving special offers developed or offered solely to them and so, being treated differently from others.” (Sigala, 2006)
This can be linked to the holistic service experience as Sigala (2006b) states that, “Research into customer participation in service value chains has shown that when participating in the service processes, guests derive both utilitarian (functional) and hedonic (emotional) benefits from the service experience.” (Sigala, 2006)
“When guests perceive that they get enhanced value and benefits from an eCRM they also remain loyal in relationships leading to enhanced business profits. In order to be able to deliver more benefits and make guests more likely to stay and participate in eCRM, hotels need to know what guests value in their relationships and what benefits they receive in terms of enhanced e-service quality” (Sigala, 2006)
If the customer start engaging in the program and then discovering further use and open a “personal” communication channel with permission from the customer, initiated by the customer and to the benefit of the customer. This will with the passing of time, usage rate and access to exclusive information deepen the relationship with the customer or as suggested in the literature, “customers getting involved with CRM practices were also found to benefit through the receipt of relevant and useful information about the availability of the services (Bruce 1994; Conway 1997), from feelings of closer involvement with the organization (Hochschild 1983; Duncan and Moriarty 1988; Roberts, Varkie and Brodie 2003), enjoyment of interaction with the charity (Duncan and Moriarty 1998), as sense of belonging (Oliver 1999), feelings of being valued and respected (Celesi and Olson 1988; Bhattacharya and Bolton 200 ), and greater understanding of the charity role (Bruce 1994). Customers gain also from being able to immerse themselves emotionally in their relationship with the organization and its accompanying social system (Oliver 1999). “ (Sigala, 2006)
“By collecting customers feedback the organization can then use it for further improving their processes and services. In this way customers also gain because firms can more effectively satisfy their needs (Coviello, Brodie and Munro 1997)” (Sigala, 2006)
“Collaborative and community building eCRM features also aim to creating a community of guests whereby all members help each other, communicate and share feedback on firms practices, take part in community activities e.g. online games, online promotions. Such eCRM practices also enhance the perceived service quality value because by participating in communities, guests derive several benefits. For example, Rosenbaum, Ostrom and Kuntze (2005) identified the following community members’ benefits.” (Sigala, 2006)
These benefits have been argued by Sigala to be transferable to an eCRM approach, “it was also found that such community benefits are also transferred to internet mediated environments” (Sigala, 2006)
According to the website socialbakers.com “Other social engagement metrics to pay attention to are Response rates, response times, Fan growth and regional reach.” (SocialBakers, 2011)
According to a study made in 2010 by Socialbakers.com they showed that, “only 5% of brands actually respond to fans when they post a question on the brands Facebook page. Talk to your community, engage your fans. This is a great way to build brand advocates and brand ambassadors” (SocialBakers, 2011)
“Beyond collecting customer knowledge, online communities can also be used for cooperating with customers (individually or within communities) for NPD and innovation (Rowley, Teahan, & Leeming, 2007; Sigala 2008). A plethora of cases and studies (i.e. in Lagrosen, 2005; Pitta & Fowler, 2005) reflects this as well. Hence, the web 2.0 enabled CRM must also reflect a culture shift from product ‘designing for the customers’ to ‘designing with’ and ‘designing by’ customers. As an eCRM strategy exploits the web 2.0 tools not only for learning about customers, but also for learning and improving with customers, the maximum benefits of eCRM 2.0 are realized when firms establish co-creation and co-learning adaptable and flexible ecosystems with partners and customers alike.” (Sigala, 2010)
Findings by Sigala (2006) also talk about “the ability of eCRM to increase guests’ evaluations of emotional and cognitive service quality by engaging customers into hotel operations. However, guests’ characteristics (e.g. gender, culture and age.) can crucially affect either guests’ willingness or guests’ capability to engage in hotel operations” (Sigala, 2006)
“The model highlights the need to integrate online eCRM with the offline hotel operations. It is only when this synergy exists that eCRM benefits and enhanced value in service quality can be delivered.” (Sigala, 2006)
Apart from the direct benefits from using an eCRM strategy is the many connections to other IT systems, as part of the IT eco-system.
According to (Volpe, 2011) CMO at Hubspot one of the leading internet companies’ social media and inbound marketing in general helps and facilitates SEO, to promote your blog, getting permission to connect with customers and get the social media conversation started. (Volpe, 2011)
One of the most important in the aspect of technical development both from a user and company perspective was the introduction of internet search engines like Google and Yahoo for example. This opened a whole new range of possibilities for the consumers to do market research, rate comparisons and look for destination facts online. With this power shift from company to consumer the companies had to rethink their marketing strategies and searchability became a top priority.
Looking at people’s search habits over the last years more and more people use search engines or met-search engines to actively search for the information they need. That it is important to show up in these searches is no news but due to the algorithms, functionality and technology that makes a search engine work a lot of factors from the online eco-system are taken into account. Many of these factors are generated by web 2.0 implementations, and as the number of places your information are shared in also is taken into account, just to mention a few all that you do there are improving your searchability and ranking in the search engines.
To leverage even further on the indirect benefit the company can make sure a strong foundation is built to support all parts of the eCRM. Mike Volpe suggests to start with the key areas of: (Volpe, 2011)
The Alcatel report argues that this works especially well when looking at more short-term campaigns i.e. Contests and exclusive campaigns. When looking at the result of one of their campaigns, they say, “The social media result of this contest was stellar – with the word going around in the form of comments, tweets and wall posts” (Alcatel-Lucent Enterprise, 2011)
The report then continues, “After the webinar, the bloggers wrote about it, and because of their massive online appeal to their audience, people passed it along through Facebook, Twitter and emails. Within 24 hours approximately 350’000’000 people had heard of it through trusted referrals. ” (Alcatel-Lucent Enterprise, 2011)
“Customer knowledge flows increases when customers are integrated within firms ‘operations and customer knowledge management is recognized as the lifeblood of CRM (Lin, Sundaram, Chi, Tatemura, & Tseng, 2006; Lin, Su, & Chien, 2006). However, although Dutta et al. (2002) advocates how the internet can be exploited for integrating customers into the firms’ value chain operations, they failed how to identify how firms can better manage and exploit the customer intelligence collected through customer integration process for creating value. To address this gap, Gibbert, Leibold, and Probst (2002) advocated the need to shift from CRM to knowledge enabled CRM (referred to as Customer Knowledge Management, CMK) whose aims is to make customers active partners in the value-creation process and collaborate with them for joint value creation.” (Sigala, 2010)
“Firms must manage not only the knowledge about customers but also the knowledge from customers (i.e., user-generated content). CKM’s philosophy ‘if we only knew what our customers knew’ stresses the need to exploit knowledge generated by any residing in customers’ online social networks and to actively involve and collaborate with customers for co-creating experiences. To that end eCRM 2.0 can utilize the five CKM styles (Table 2) for demonstrating how to create new types of customer value and building customer relationships through the exploitation of social networking, learning and intelligence capabilities of the web 2.0 that ultimately transform customers from passive into active co-marketers , co-producers, and/or co-designer s of the tourism experiences.” (Sigala, 2010)
