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Hilton Hotels - Business Summary

 

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             Rare: No. Hilton had not been the first to make its foray into deep personalization of guest experiences, an area that the Ritz Carlton had pioneered in the luxury segment and Wyndham International had introduced to the upper upscale segment. Nevertheless Hilton was the only company that has the same technology platform and distribution footprint throughout all the brands. Hilton had been the first major multibrand operator to roll out a strong, integrated customer relationship management effort that was tightly integrated with its frequent guest program and was delivered chain-wide.
             Inimitable: No. Since they had a distributed footprint in all their brands, they were able to collect data that was very wide in scope and included customers of every kind. This could be imitated in the future, but being the pioneer for such an implementation gives Hilton a competitive edge over their rivals. .
             Nonsubstitutable: Neither the CRM or the OnG individually could produce the same kind of benefits and results for Hilton. Also other frequent guest programs could be used to build relationships with their high-value customers to achieve similar results. .
             3. Evaluate the performance of the CRM application after 2002 along the following dimensions:.
             a) ROI for the Hilton Brand (use the call-center data for this).
             Hilton deployed the OnQ in the year 2002, since then, as per the call center data, there has been a significant increase in the volume of calls to Hilton's call center and also the net revenue per call though not completely linearly. Hilton invested a total of $1.65 mil in implementation of the CRM application and generated a total revenue of $1.81mil (no. of calls* revenue generated per call) as per call center data. Even with a $1mil expenditure on maintenance every year, Hilton made a significant profits in terms of ROI. We can also note that even though conversion rates would fluctuate, the revenue generated per call over the years has only steadily increased.


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