PowerPoint Presentation

What do hotel customers really want?Measuring the intangible with Behavioural Conjoint Leigh CaldwellCo-founder & PartnerThe Irrational Agency @leighblue

Lizzi SeearGlobal Consumer and Market Insights DirectorInterContinental Hotels Group

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IHGs goalTo have great hotel brands that guests love

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When Kemmons Wilson opened the first Holiday Inn in 1952, he knew exactly who his customers were and what they wanted.Mum and Dad and two kids who needed a swimming pool, an affordable meal, and no hidden charges.

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Thats exactly what they got.Today things are a little more complicated to say the least.Sounds simple, but at the time it was revolutionary.

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Over the past sixty years, huge social, economic, cultural and demographic changes have revolutionised our business, our industry, and indeed our world.

High levels of global recognition but both brands need a clearer focus on customer needs to ensure growth and revenue targets are met.1,151 Holiday Inns and 2,406 Holiday Inn Expresses around the globe

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Both brands have a wealth of data - customer satisfaction, brand equity, data analytics. Lots of key driver and correlation analysis has been run and whilst useful, none of it has identified the moments of truth for each brand.

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What should each brand be focusing on to create differentiation in a competitive and crowded market?

What elements of the guest journey drive value - emotional value and commercial value?

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These were the questions that we turned to Irrational Agency for help answering.

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The whole research world has a shared problem.But it turns out these arent only IHGs problems

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There's a problem with researchSelf-report doesnt work: only 50% correlation between claimed purchase intent and actual purchases

Everyone underestimates their own biases

To the limited extent that self-report does work, it's become a commodity

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Because theres a problem with peopleWe dont understand ourselves

and we cant tell the truth.

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Image (and self-image) managementIntrospective abilityImagining behaviour in hypothetical situationsResponse biasesAbstract questions give bad answersThe problem with people

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100 years of psychology has tried to help us do betterBut have we listened?Wundt, James, PavlovFreud, Watson, Jung, SkinnerChomsky and cognitivismEdwards, Slovic, Lichtenstein and decision theoryTversky, Kahneman, Thaler, Loewenstein and the world of behavioural economics

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How can we turn this scienceinto new ways to answerreal business questions?

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Lots of data, lots of statistics but none of it answers one key question.

What do guests really want?

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This is about the intangible as much or more than the tangible features that people want.

Its one thing to ask What channels do you want on your TV? Is CNN better than Bloomberg?

But isnt it more important to know How do you want your hotel room to make you feel?15

Existing tools were not helping.

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Customer satisfaction tool focused on operations: was the room clean, staff polite? Ensures we deliver on the basics not where the brand can create a distinctive touchpoint

Brand equity gives a competitive context on how guests perceive us and our competitors but at a very high level: can identify white space in the category but how can we fill it?

Plenty of research work done over the years gave some indications of possible meaningful touchpoints but how to ensure we understand the subconscious drivers.

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Mention something about considering other more conventional MR tools that were out in the marketplace standard conjoint, ordinary quant surveys but realising they werent going to answer the real questions.17

Behavioural ConjointProvides the dimensionality of traditional conjointThe accuracy of implicit measuresMeasures intangible as well as tangible driversThe ability to measure a huge depth of detail in a statistically reliable way due to scaleA new generation of tools can help

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30,000+ people

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How we linked psychology, economics and conjoint analysis

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Asking the right questionsRecreating the in-the-moment mindsetAsking about tangible, infer the intangiblePacing and rhythmUnderstanding how to get accurate responses

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How we measured what customers really value

Asked people to think about their last hotel stayPresented a series of choices between two hotel experiencesLimited time to choose to access more intuitive, less rationalised motivesSimulated journey through the hotel stay from arrival to departureTrade-offs with implicit ranking+

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Behavioural economic decisionsPrice matters but in the context of a rangeFeatures and utility matter but they are subjectiveBudget matters but less than you'd think. A benchmark not a real constraint

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Why behavioural conjoint is differentTraditional conjoint:

Assumes that respondents have unlimited time to make a decisionAssumes they take all factors into account, even if some receive a low weighting

Produces a single utility weighting across all customers

Uses a fixed list of attributes and levels

Is focused on product features and price

Behavioural conjoint:

Mirrors the decision-making pace of real life by making respondents choose quicklyFinds out which are the 2-3 key factors that respondents use in each decision

Separately produces attribute rankings and attribute weightings and clusters respondents into groups with different utility weightings

Adaptively presents options as it learns about each respondents decision process

Can test the impact of context, product features and psychological pricing

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The other tools we usedMobile ethnographyImplicit rankingImmersive questionnaire

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Please tell us the first thing you did when you got to your hotel roomMobile ethnography

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Implicit ranking

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Your stay costs 45 more than you expected it toImplicit ranking

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Immersive questionnaireScreeningContext immersion: memory, prompting, framingBehavioural conjoint

Implicit rankingExplicit questions

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What did we discover?

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What matters to guestsSome things we already knew that mattered, but could now finally put a dollar value on and calculate ROI

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Differences globally

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It really reminded me of the hotel experience I had during my last visit.There was a lot of information on choices so I tended to pick the most important things even if the rest weren't to my liking. It was fun and enjoyable and informative too. Very different and apt for travellers like me!I liked the idea of choosing between the 2 options and comparing which was better/worse. It was challenging and thought-provoking. Quite different than the regular ones, particularly the time bound choice segment was really a very enjoyable aspect.What did respondents say?The timed part did get somewhat nerve racking like I was taking a test but not too bad.survey help to read mind of guests.Good survey, easy to understand....kept you busy enough and focusedsurvey is very relevant to me. survey design is great, very user friendly thank youI actually enjoyed this one.

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Validating what we measuredExplicit vs. implicit checksStrict dominance checksSense checks from the business

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The broader message

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What else can we do with these tools?Predicting purchase likelihoodPrice sensitivity analysisMeasuring prejudices and unconscious bias

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What else can we do with these tools?

Interior RoomSea ViewDeluxeSuite

Price32037048074024 hour conciergeOcean ViewBalconyPriority Check In

6 Day Western Caribbean Cruise

SelectSelectSelectSelect

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What else can we do with these tools?TripAdvisor Traveller rating

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What else can we do with these tools?

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Whats really important hereMirroring true decision-makingUnderstanding the real meaning of "value" and "choice"In a way that's actionable for business

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Where has this insight taken IHG?Focused insight to build truly differentiated moments in the customer journey with robust evidence to gain support of the business and hotel owners

Focused brand plans for Holiday Inn and Holiday Inn Express over the next three years.

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Groups of attributes that provide a single, consistent, self contained experience for our target guest that both currently drive value and, more importantly, will lead to increased ADR (Average Daily Rate)Each brand has developed its Key Moments

Currently we are either piloting or planning to pilot these enhanced key moments across all of our regions with the aim of globally rolling out the most impactful in 2017.

What do hotel customers really want?Measuring the intangible with Behavioural Conjoint Leigh CaldwellCo-founder & PartnerThe Irrational Agency @leighblue

Lizzi SeearGlobal Consumer and Market Insights DirectorInterContinental Hotels Group

Questions?

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