When making strategic decisions, there is always a risk of looking from the inside out, for example from a business perspective, which responds to a “how” mentality more concerned with viability.
the opposite option it is looking from the outside, that is, how the situation is seen through the eyes of another person – preferably the eyes of the customers the company is trying to serve. This mindset is similar to that of Steve Jobs when he exhorted people to do something new without considering how they were going to make it happen.
The tendency of business leaders to choose feasible ideas over more creative ideas of your customers may unintentionally limit growth, or make you more difficult to reach.
Very often, this translates into “me too” strategies, with companies competing with no real advantage, ultimately leading to lower growth and lower profits.
By adopting winning strategies, staying in touch with customers helps you stay relevant despite changes in the market.
This forces companies to drop assumptions about what they can do or how they should do it, and instead look at the big picture trying to understand where the market is headed.
The intersection between what the company does well and the needs of customers increases its effectiveness in the market. Let’s look at some examples.
Business Strategy from the Clients Perspective
After many years of growth, primarily through mergers and acquisitions, Hilton Worldwide realized that it was no longer competing in the marketplace as effectively as it used to. It decided to refocus its business strategy around one of the brand’s core promises, namely: “ensuring that every guest feels cared for, valued and respected”. It meant reviewing their business strategy through the eyes of specific customer segments that could grow both revenue and profit.
One such segment is Millennials, who have very specific priorities when it comes to their travel budget. Interested in fashion and design, and fully connected with the Internet age, your priority is on the destination of your trips and not on the properties in which they stay.
They want accommodation that is affordable, easy in and out, no frills, a hotel with the basics like free Wi-Fi and breakfast. The lifestyle becomes part of the experience: cool room, cool lobby where they can work and socialize and have a drink.
These Hampton Inns have been key pieces for the Hilton chain within its lower cost portfolio. They are hotels with few amenities with “selected services”, in short, the response of the hospitality industry to Airbnb.
Among the specific requirements a lap desk is included for guests who want to work from their beds; six or twelve towels, depending on the type of room; two works of art, preferably by local artists; and a buffet breakfast with at least one local item.
The same goes for the free snack at check-in for members of the rewards program. There’s also a long bar in the lounge, encouraging guests to use the common space and socialize (and don’t feel obligated to stay in their rooms).
Working with local designers has led to some stellar results, like the one in Austin, Texas, which showcases the design of a large graffiti mural in the two-story lobby, vintage western-style chandeliers and a wrought-iron balcony in the that guests can sit and gaze at the city skyline.
Select Service hotels have not only produced real value for customers with substantial room upgrades, but also for owners and operators.
These hotels are relatively easy to build, inexpensive to operate, and are proving to be more profitable, with margins of 500 to 1,500 basis points above typical full-service hotels.
As a result, Select Service projects that 50% of the Hilton’s total supply will be for new construction in 2015.
Another pillar of Hilton Worldwide’s strategy is overseas Chinese travelers.
Hilton launched the program Hilton Huanying in 2011, a consistent set of amenities and services to meet the unique needs and expectations of the overseas Chinese traveler.
Guests are greeted at the front desk by a Chinese-speaking team member, a welcome note written in simplified Chinese awaits them in the room, while their rooms are equipped with amenities such as kettles, jasmine tea, slippers, TV channels Mandarin, and a Chinese translation service.
Special dishes for breakfast include rice soup, fried rice, fried noodles, dim sum, boiled eggs, Chinese tea, soy milk and other items including red packed chopsticks. All 10 hotel brands within the Hilton Worldwide portfolio are eligible to participate in the program. This also represents an opportunity for them to build brand loyalty.
The Huanying Program Chinese travelers are encouraged to stay at Hilton Worldwide properties throughout China. Huanying messages are sent on WeChat, and on Weibo through partnerships with Chinese celebrities and brands, as well as through a dedicated Chinese website.
A new business strategy developed through the eyes of specific customer segments has helped Hilton Worldwide move from being, at best, “average service” to a more aligned and profitable company with a portfolio of 10 brands that regularly stand out in their respective segments. It now operates more than 4,500 properties and 720,000 rooms in nearly 100 countries.