BALTIMORE, Maryland—Knowing what to look for and managing expectations are key steps in benefitting from segmentation, according to speakers at a session called “Market Segmentation Refined” during Monday’s HSMAI Revenue Optimization Conference.
“Data is king, and we now expect the data to be a thousand times amped up,” said Elizabeth Cambra, corporate director of pricing and revenue optimization for Outrigger Hotels Hawaii.
She said finance departments tend to take a just-the-facts approach and want to look at clean data. Marketing and revenue management departments, on the other hand, want the data to be more robust and sortable.
“A strong reporting tool is one of the most important things to focus on,” Cambra said. “It allows you to look at things in the 17,000 ways people want to see it.”
What it really boils down to is that data users want their information customized and personalized—and the end result is to have personalized and customized approaches to attracting customers, she said.
“Data is golden: It is instantaneous, personalized and accurate,” Cambra said.
That personalization often creates a chasm between marketing and revenue management because, while their functions complement one another, getting to the end result often can take completely separate roads, the speakers said.
Jon Elliot, director of strategic marketing for Mohegan Sun Casino in Montville, Connecticut, said that while “revenue management and marketing really do love each other,” the current distribution landscape often puts them at odds.
“Channel management is becoming a very nontraditional, overlapping, muddled pool of potential business,” he said, adding that knowing how all customer segments are performing at any given time is an important element of successful revenue management.
His company is utilizing a new guest-tracking system to better understand their spending habits—something that goes a long way in maximizing the potential of every market segment, Elliot said.
“Traditional marketing dollars can be used in nontraditional efforts to improve guest experience,” he said. “There are a lot of opportunities to track different things in the hotel that have never been tracked before.”
Cambra said ensuring that data is sliced and diced in every way possible will allow hoteliers to get the most out of their programs.
“I encourage you to not get too hung up on your labels, and you’ll see a lot more,” she said. “No matter how you cut your data, you have to make sure you look at every corner of it. Regardless of your labels, cut it another 10 times and you’ll get a better answer.”
That often means that departments don’t always get along, and Cambra said it’s OK to disagree and defend your position with gusto.
“I would encourage you to take a man out. It’s OK to argue,” she said. “It’s not personal. … we are not here to all agree.”
But such an approach should always have one mission in mind: “Align your goals ... we always want to make more money. It’s that simple,” Cambra said.
Making more money often requires better forecasting, and there’s an ongoing learning curve involved with that, said moderator Kent Duncan, VP of sales and revenue strategy for Marcus Hotels & Resorts.
“One of the big challenges we’re trying to decipher is how do you break it down as you forecast individual source buckets,” he said. “A strong reporting tool is important to have.
“More and more customer segmentation is being cut into a segment of one. It’s getting into more (customer-relationship management) data becoming market segments we’re looking at.”
Elliott said his property’s deep-dive into CRM is just getting started.
“We don’t have the data yet. I’m going to be looking at overall profitability, but I have to keep in mind what our hotel is (a casino-resort),” he said.
He said one mistake the Mohegan Sun wants to avoid is alienating its existing customers while trying to bring in a person that is perceived as more profitable. Only when he can identify consumer patterns can it really be determined if that new customer is as profitable as current customers, he said.
The whole CRM-market segmentation equation must be carefully monitored, said audience member Wesley Bloomfield, senior marketing manager for Charlestowne Hotels.
“CRM can be a little overwhelming at times and you run the risk of filtering down too much,” she said.
The biggest issue is making sure guests are put into the right segment at the start, Bloomfield said.
“Reservationists answering the phone and putting them in the right bucket is important. You don’t know where to attribute that data to unless the reservationists drill down to get the right information.”