Customer

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Step 6/10: Type of customers generally

There are different types of customers, keep that in mind. Some people in hospitality industry rather talk about guests then customers: we will stick to customers as this is much broader then just the people who book. Here are some remarks giving to the customer and the demand side of the market in general.
There is different type of customers, like:

• Price buyers

Some of the customers are very sensitive to price changes and will only be loyal to the lowest prices in the market. This is (luckily?) less than 10 percent of the total of all of the markets: we define this group as price buyers.

• Memory!

Keep in mind that you cannot just change a hotel strategy (for instance on price or promotion) very drastic every year. Therefore there are also limitations to the changes you can do. A hotel has a certain image as to what customers think of you. This will last, which means in effect the main part of the (potential) customers will remember last year as well and will take this into account in deciding which hotel to choose this year.

• Elasticity

There is elasticity of the price in the market. But the price is just one of the items on which the market reacts. If the prices go way too low or way too high there will be a "buyers-strike" in the market, the elasticity will deliver an extreme reaction at a certain point as you (all) might have lost credibility then. This means people will choose for the competition on a higher level and might exchange a stay in a hotel for a long haul trip or a package deal or even buy new furniture instead of booking a trip. The total of the demand side then will shrink.

• Small differences

The customers are sensitive to price-differences; it is just not true that they are always looking for a bargain. But, if things seem to be a like a small difference in price or a psychological interesting price just may convince customers to book at your hotel.

• Last year's costs made

As most costs and expenditures are only related to one specific year, this means that they only have effect in that one specific year, keep that in mind.

• Random

There is a small group, no matter what you do, who chooses their hotel in a kind of random way. It is impossible to influence this group.

Guests so far

The number of customers becoming guests is to be found in the occupancy rate. Take care of the wishes of your customers and other interest groups (stakeholders) as well as keeping the objectives of the hotel in mind combined with your own goals! On the page How do I get customers more information on getting your customers is given. In the documentation available so far, there is no distinction visible between which customers are booked in the renovated rooms and which in the not renovated rooms.
The split up in types of customers seems to be a bit out of fashion, as the offer from the hotel stands and any customers just makes its own choice. Especially as the hotel is operating internationally in the modern 24/7 economy.

Type of customer's leisure

There is no specific information on the type of customers. The hotel has always in the first place been aiming at the business market and in the second place on the leisure market. The type of customers attracted so far represents the total of the leisure market. Not really a lot of families with children (due to the location in the city probably). At an average the room occupancy of 1.7 persons per room still also a large group of people who travel alone.
As explained in targetgroups, weekend days are more used by the leisure customers.

Type of customers business

There is no specific information on the type of customers. The hotel has always in the first place been aiming at the business market and in the second place on the leisure market. The type of customers attracted so far is an average of the business market. (Almost) all rooms are occupied just by one person: so the average number of guest during the weekdays in any room is 1.0. It seems that the location (in the city) is appreciated highly by the business customers: so not somewhere in the outskirt of the city next to the highway. Next to that the hotel scores points for being a family owned and run hotel so with personal attention for the needs of its customers.
As explained in target groups, weekdays are more used by the business customers.

New targetgroups

New ideas on the targetgroups are very welcome. The only thing Christina wants you to stick to is a difference on prices for the weekend and the weekdays. For both situations decide on a rack-rate (maximum price) and a last-minute rate (a minimum). Other plans on prices you have to do in your other (marketing) decisions).

→ Go! Following the Introduction to the Hotel? Step 7/10 is the page how do I get customers, click here

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