WHAT DOES THE HOSPITALITY INDUSTRY KNOW?
THE 80/20 RULE IN HOSPITALITY: WHY REPEAT GUESTS ARE YOUR GREATEST ASSETS
The hospitality industry lives by the 80/20 Rule, also known as the Pareto Principle. This states that approximately 80% of results often come from just 20% of your efforts or customers. In other words, profits come from just 20% of your most valuable clients. Thus, you should be focusing on your top repeating clients.
THE MOST IMPORTANT GOAL: OBTAINING AND RETAINING REPEAT CLIENTS
It is essential to identify, nurture, and retail your repeat customers. They are the key to sustainable growth.
- Revenue Concentration
- Predictable Business
- Lower Cost of Retention
- Word of Mouth Power
WHY REPEAT GUESTS MATTER MORE THAN ONE-TIME VISITORS:
Of course, every guest experience matters but focusing on the repeat guest amplifies impact:
- Higher Lifetime Value: a loyal guest brings consistent revenue over the lifetime of your business
- Emotional Connection: Repeat guests often feel personal attachment to your property “brand”- they are coming home. There is an emotional attachment.
- Resilience During Market Shifts: When newcomers to the market, trends and pricing pressures arrive, loyal guests are likelier to choose a property they trust
INCREASING REPEAT GUEST LOYALTY:
How does one nurture this relationship?
- Personalisation at Scales: Remember what your guests would like to have on arrival in a welcome basket: skim or full milk? Chocolates or fruit?
- Consistent Service Standards: A repeat guest comes back because first stay delivered value; it is important to keep exceeding expectations in consistency in cleanliness, service quality, bathroom amenities and attention to details.
- Recognition & Appreciation: A simple handwritten note “Welcome back Mr. and Mrs. Jones” goes a long way. Recognition creates a sense of belonging and emotional loyalty.
- Technology & Human Touch: Track interactions with staff to add memorable personal touches and note any negative occurrences that might need to be fixed promptly.
SUMMARY
The importance of “WOWING” your guests to elevate your property cannot be expressed enough. Your repeat guest unlocks the potential for consistent revenue, reduced marketing costs and a stronger reputation. In the hospitality sector the Pareto Principle or the 80/20 Rule is a formula for success.