Hotels Keep Customers Happy Despite Cuts in Staff and Service
Market Metrix Announces First Quarter 2009 Hospitality Index Results
Comparing performance across the hospitality industry
Hotels are facing a difficult time as consumers and businesses tighten spending on vacations and scale back on conventions and business travel. Despite the escalating recession, the industry has been able to protect the guest experience – customer satisfaction remains steady at near record level scores. However, the results for individual hotel companies are mixed. Unlike previous recessions, the luxury chains have been hit hard this time – here prices as well as quality of service have been cut. This is problematic, because the success of the luxury hotel is a function of great service and reasonably high margins. By contrast, value for money has remained strong for the budget hotels, in part because both prices and service were low to begin with.
The car rental industry continues to face a difficult operating environment with fewer people renting cars and rising costs (e.g. higher vehicle maintenance and repair costs). As a result, reductions in staff and operational cutbacks have resulted in diminishing levels of customer satisfaction. Hertz (+.8 to 80.1) and Thrifty (+.5 to 79.9) showed the biggest improvements in customer satisfaction scores while Alamo (-3.5 to 77) and Budget (-2.2 to 77.3) showed the biggest declines. Enterprise continues their industry dominance with overall satisfaction and loyalty scores well above competitors.
Passenger satisfaction with airlines declined (-1.9 to 75.8) compared to the fourth quarter of 2008. High volatility in fuel prices, indifferent service, labor problems, congested airports, and financial challenges continue to weigh heavily on the industry. Airlines remain the lowest scoring industry in this study. JetBlue retained the top spot with improved scores while AirTran posted the biggest decline (-1.1 to 76.0). Frontier Airlines continues its ascent with improved scores (+3.5 to 82) landing the brand in second place and edging closer to the top spot.
Top Scoring Hotel Brands
The top score among all hotel brands for Q1 2009 was Mandarin Oriental – a portfolio of deluxe and first class hotels, resorts, and residences in 25 countries. Guests rave about their “inspiring” experience, the “exquisite facilities”, the staff’s “legendary service” and even the “great value”. Kimpton Hotels posted a big gain (+4.9 to 94.7) and won the Upper Upscale category. The first quarter results also included two first time winners: The Golden Nugget Hotel and Casino (+2.8 to 88.1) won the Casino segment and WorldMark by Wyndham (formerly Trendwest Resorts) increased .5 to 91.5 which earned them top honors in the Timeshare Accommodations category.
About MMHI | Based on 35,000 customer interviews conducted each quarter, the Market Metrix Hospitality Index™ (MMHI) is the largest and most in-depth measure of hospitality company performance available today. These benchmarks, delivered through our flagship product Customer Metrix™, enable Market Metrix clients to compare their results to competitors by STAR segment, AAA classification, Brand, SMSA, industry averages, performers in the top 10%, and other classifications. The MMHI is also available by subscription.
About Market Metrix | Market Metrix is helping hospitality companies around the world succeed in the tough economy. With guest feedback collected 24/7/365, and built-in service recovery and investment decision support tools, we help clients save money and reduce risk of client defections. Based on award-winning research and breakthrough concepts, our SaaS-based products deliver instant survey results, analysis, and management tools for increasing revenue and reducing staff turnover. Our benchmarking database, MMHI, is the most comprehensive, independent comparison of consumer brand satisfaction in the industry. Our annual MMHI Awards are coveted by lodging and travel enterprises around the world. With clients that include more than 120 brands across 70 countries, Market Metrix has been helping leading hospitality companies turn feedback into performance since 1996.
Jonathan Ph.D. Barsky