CUSTOMER SEGMENTATIONDURING COVID-19

TABLE OF CONTENTS

Introduction …………....…………………………………………………………………………….……………..….……………....…

Gathering the Guest Data .………………………………………………………………………………………………….

The Combination of Historical & Real-time Data ……………………………………….…………

How to Address the Right Profiles with the Right Campaign …………………………..

RFM Segment Classification………………..….…….…………..…………………………………………………………..

Identify Segments through Micro-Analysis ….………………………………........……………………

Conclusion …………………………………………………………………………………………………..............……….

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INTRODUCTION

In a highly competitive market, it is important to do

more than just mass email marketing campaigns. In

order to cut through the marketing buzz from the

competition, you must ensure that you target the right

audience, at the right time, with the right message.

Now during the COVID-19 crisis, a targeted and more

intelligent segmentation approach has become even

more important than ever. For efficient marketing,

hotels must target guests from regions where the travel

bans have been lifted and where it is more likely that

you can attract guests to your properties.

But how does regional segmentation work? How do you

know what your guests are interested in? How do you

know what someone is interested in when they have

never been a guest at your hotels?

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GUEST DATAGATHERING THE

Providing a tailored guest experience is crucial in order to keep your guests satisfied, to spend more money with you, and to

have your guests return to your properties again. You can enhance their experience by serving highly relevant, personalized and

individualized content at each touchpoint throughout the guest journey.

In order to be able to address your guests with relevant information and offers, you need information about them. Guest

information is typically collected through a number of different siloed systems within your hotel(s), for example, the Property

Management System (PMS), the Central Reservation System (CRS), and spa or restaurant software. The NextGuest Guest Data

Management Platform (GDMP), the core of the NextGuest CRM, allows you to integrate these systems and build a central profile

based on enriched data from all integrated systems.

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The NextGuest CRM allows you to access relevant guest historical information like detailed booking/stay history, lifetime value,

preferences and interests, survey and feedback history, marketing campaign history and more. This enables hoteliers to have a

comprehensive overview of guest information and the relationship with the guest. For hotel chains, the main advantage is to have a

complete overview about a guest’s stays in different hotels. After all, guests may have decided to visit different places while always

staying at a property within the hotel chain, and that’s something a hotel operator really wants to know in order to address guests with

appropriate offers and to show them how much their business is appreciated.

Historical data is, of course, an advantage. If a guest stayed at the same hotel several times, he is probably interested in an offer for this

hotel. However, if this historical data is combined with real-time data, your profiles will have an even higher value. Imagine including

actual current data about what guests are currently looking for and their interests and intents. For example, if you know that your guest

is currently interested in your spa offer and you send them an offer including a special spa package, the likelihood of the guest actually

booking increases dramatically. Read on and find out how you can enrich your guest profiles with data related to the current intentions

and interests of your guests.

HISTORICAL DATA

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REAL-TIME DATA

Collect real-time data to enrich profiles with valuable

information and create profiles for new potential

guests.

Data related to the current intentions and interests of

guests can be collected through tracking and scoring of

visitors’ behavior on the hotel website. The scoring can

determine what the visitor is interested in and their level

of interest. Once the interest level has been determined to

be high enough, the visitor can be served with

personalized content, offers, and even a personalized pop-

up asking the visitor to sign up for a specific newsletter for

example. Once the visitor signs up for the newsletter, a

new profile, including the visitor’s identified interests, is

created in the CRM, allowing you to target the now

known prospect with marketing and offers based on their

current interests. Of course, it is important that all

required consents through the website for processing the

data are ensured. Guests that have already signed up for

the newsletter will continuously be tracked and scored

when returning to your website and their CRM profiles’

interest score will be updated accordingly.

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HISTORICAL & REAL-TIME DATA

Knowing what guests are interested in on the website provides an

opportunity to do real-time marketing and engage with them at the

right time. However it is important to remember that we can only

build a true guest profile by combining real-time data with traditional

historic data. The unique combination of real-time intent data and

historic data allows you to do better targeting, optimize and

personalize your marketing activities and guest communication

throughout the whole guest journey, and through this increase

booking conversion, increase guest satisfaction, generate more

revenue, and have more time for your guests on property due to

automation.

The combination of historical and real-time data in the CRM helps

provide hoteliers with a holistic picture and knowledge of their

guests. Through the profiles in CRM, you now have valuable

knowledge of existing guests and potential future guests. In order to

increase bookings and generate revenue using this knowledge, it is

essential to address these profiles through targeted marketing

campaigns.

To target individuals and address them personally, the information

that is already stored in the guest profiles is used. In order to fill

marketing campaigns with content that resonates with the target

groups, it is essential to segment target groups accordingly.

THE COMBINATION OF

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RECENCY

How frequently does a guest stay? How many stays do they have so far or is the guest a potential guest? Is this a one-time guest? For repeat guests, do they have two stays or at least three stays?

FREQUENCY

THE RIGHT CAMPAIGN HOW TO ADDRESS THE RIGHT PROFILES WITH

How recent has a guest stayed? Does the guest have a stay within the last 24 months?

3 What is the total monetary value of a guest? What is the spending behavior of each guest? Is the revenue below or above the average revenue? There are different possibilities as to which average revenue is used for calculation (revenue per night or revenue per stay).

MONETARY

Understanding the lifetime value of guests, including the type of content and promotions that compel them to book direct,

is crucial to an effective campaign strategy.

One way of understanding the value of your guests and knowing your most profitable guest is to make use of RFM (recency,

frequency, and monetary) segmentation. With the combined power of RFM data, hotel marketers can get a deeper

understanding of a guest’s relationship with the brand and use this data to reach a more qualified audience with

personalized messaging.

RFM analysis looks at all bookings and transactions in your CRM during a specific time period, usually the last 2-3 years, and

determines the value of your guests based on the following three components:

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Based on RFM, you can classify your guest database into different value segments. Here are some examples:

INACTIVE GUEST RFM CLASSIFICATIONS

Former Best Guest: High revenue, inactive guests that haven’t stayed within the last two years but have stayed more than two times.

Former Potential Best Guest: High revenue, inactive guests that haven’t stayed within the last two years but have stayed at least twice.

Former Frequent Smart Shopper: Low revenue, inactive guests that haven’t stayed within the last two years but have stayed at least twice.

Former One-Time Smart Shopper: Low revenue, inactive guests that haven’t stayed within the last two years but have stayed one time.

LOWER VALUE RFM CLASSIFICATIONS

Frequent Smart Shopper: Low revenue, active guests that have stayed with your hotel brand within the last year two or more times.

One-Time Smart Shopper: Low revenue, active guests that have stayed with your hotel brand within the last year one time.

High Value RFM Classifications

Premium Best Guest: High revenue, active guests who have stayed within the last year, and have stayed with your hotel brand three or more times.

Best Guest: High revenue, active guests who have stayed within the last year, and have stayed with your hotel brand two or more times.

Potential Best Guest: High revenue, active guests that have stayed within the last year, and have stayed with your hotel brand at least once.

HIGH VALUE RFM CLASSIFICATIONS

Premium Best Guest: High revenue, active guests who have stayed within the last year, and have stayed with your hotel brand three or more times.

Best Guest: High revenue, active guests who have stayed within the last year, and have stayed with your hotel brand two or more times.

Potential Best Guest: High revenue, active guests that have stayed within the last year, and have stayed with your hotel brand at least once.

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RFM SEGMENT CLASSIFICATIONS

Now that the RFM data has been classified into different segments you need to understand who is included in these segments,

what behavior the specified segments show, and what they love about your hotel. To help uncover this information, you can

analyze the data stored in the CRM.

Analyze demographic data: Age, income, gender, etc.

Analyze customer interests: Food, art and culture, wellness, sports, etc.

Analyze customer reviews: Emotional and functional benefits that a guest associates with your hotel

With these insights you can shape a customer persona and begin building campaigns that go beyond targeting a blanket

demographic with a human-centric approach that resonates with potential guests.

Overall, RFM segmentation of your CRM data can be a powerful tool to launch more personalized, effective, and cost-efficient

communication resulting in more direct bookings and more loyal guests.

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USING RFM DATA TO BUILD CAMPAIGNS

MICRO-ANALYSISIDENTIFY SEGMENTS THROUGH

The NextGuest Decision Maker is a unique combination of

analytics and campaign execution. The Decision Maker

allows you to analyze and identify problem areas, find the

root cause, and create campaign segmentation to mitigate

the problem. It can also be used to do micro segmentations,

like identifying the relevant guest segments based on

interests, age groups, RFM value segments, gender and

where they live, allowing you to target guests in areas where

traveling is not restricted due to COVID-19.

With a couple of intuitive mouse clicks, the Decision Maker

can support you in building complex target lists enabling a

high degree of personalization. Target your guests with

special campaigns including matching content and offers

that are most relevant to them.

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CONCLUSION

In order to cut through the marketing buzz, a successful CRM system needs to offer campaign capabilities that provide 1:1

personalization and attribute-based offerings by combining real-time intent and historic customer data. By carefully defining

target segments and using personalized messaging, conversion rates and success rates of campaigns will increase overall. A

better understanding of the guest will optimize the guest experience significantly, as personalized offers provide extra value to

the guest and give them the feeling of being valued.

With NextGuest CRM, guest communication is targeted, dynamic, and kept relevant before, during, and after the guest stays,

with the aim of delivering a highly-satisfying experience that builds long-term guest loyalty.

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NextGuest provides hoteliers with everything they

need to thrive in the digital world. Through its

subsidiary divisions, the company provides digital

marketing, CRM services, technology solutions, and

high-level consulting to some of the world’s top

hotel brands. Based in New York City, the company

is comprised of NextGuest Digital, CRM, Labs, and

Consulting. Each arm of the company offers stand-

alone services, while together they provide an all-

encompassing partner that helps hoteliers acquire,

engage, and retain their next guest.

www.nextguest.com

(800) 649-5076

hello@nextguest.com

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