Hotel Referrals Performance

Access your KPIs online;
Measure your success;

Navigation: All Balanced Scorecard Articles > Customer Service and Call centers

Referral programs are popular everywhere. Indeed, why not pay people or organizations that bring new customers? Hotels are not exception here. Read this article to learn how BSC can be used to evaluate referral program efficiency. Check additional information about hotel referrals performance.

Referral programs are very popular in different businesses, especially online ones. The idea of paying money to people and businesses that bring customers is not new. Yes, you will have to part with some money since you'll have to pay for the person who did something to bring a customer to your business. However, statistics shows that it is better to have 100 customers who would buy your products and discounted prices than two have 10 customers who will pay the full price. Referral programs are profitable both for referrals and companies that actually pay for customers. Affiliate and referral programs are not the same. In affiliate business you don't necessarily have to be to a company customer to promote its products and services. In referral programs you become a customer and you get lower rates and prices in case you manage to bring more customers to a particular company. In case of a hotel business referral programs turn out to be extremely effective. We all love to travel and many people have to travel and stay somewhere because of business activity, participation in seminars and conferences etc.

Thus, for example, if you know the person who needs to stay in a certain city for a couple of days you can recommend a particular hotel and then, when booking a room for yourself, you will get a discount since you brought a new customer and thus benefited such a hotel. Of course, in order to make referral program effective it should be constantly evaluated and monitored. Balanced Scorecard is a very popular tool in hospitality industry. Although traditionally it is used to measure a hotel performance and efficiency of its services, like kitchen all laundry, reception or security, advertising, referral and promotion campaigns can be also evaluated with this fantastic and extremely effective performance evaluation and business management tool.

Evaluation of key performance indicators in balance scorecard helps top managers better understand the nature of referral programs and their compliance with strategic goals. As already said above, hotel top management needs to pay money to start a referral program. Naturally, they want to make profits. Evaluation of financial indicators will help find out whether or not a referral program turns out to be a success.

Customer perspective of Balanced Scorecard contains key performance indicators that demonstrate satisfaction of both hotel customers and hotel management with existing referral programs. For example, evaluation of number of customers satisfied with suggested hotel will greatly assist top management in their decision-making regarding referral programs.

It is also vitally important to evaluate different directions of referral programs. They should be targeted at different customer groups. For example, inexpensive rooms and hotels can be promoted via social networks where lots of young people spend so much time. Business people would be rather interested in luxurious hotels. Thus, such referral programs can be offered to regular business customers who perhaps organize conferences and meetings in hotels.

As a rule, big companies love hotel referral programs since by bringing new customers they get discounts which can be huge taken into account that company employees travel a lot.

If you are interested in hotel referrals performance, check this link to find out more about hotel referrals performance. Also, you can check other articles in Customer Service and Call centers category.

Balanced Scorecard Toolkit includes step-by-step manuals, documents, presentations, check lists designed to help business professionals with successful development and implementation of Balanced Scorecard. Learn more about BSC Toolkit.