This article was originally written for the www.thestrategystory.com
You can find the original link here--> https://thestrategystory.com/2021/06/09/ritz-carlton-business-strategy/
What’s the checklist that you carry whenever you plan to book a hotel for your next vacation?
Affordability- whether it falls in your range of budget that you’re planning to?
Location- is it near, or is it far from, those milestones or checkpoints that you have added as a must-go?
Extra services that come with your room and so on…
All the above points give a glimpse of the plan for the city or the country you’re planning to visit. What if you just put the hotel as a visit point? What if there’s a hotel that not only provides you with these services but takes care of the little things that go beyond and extra. Maybe:
The luxury of a private bath in each room you book or
Soothing fabrics and plush couches with a great bed
An extra credit for the white tie and apron uniforms that is adorned by the waitstaff, conducive to a formal and professional appearance
Extensive and lavish fresh flowers throughout the public areas plus a welcome bouquet to honor your arrival
Gourmet cuisine, utilizing the genius and cooking methods of the best chefs in the town
Intimate and smaller lobbies for a more personalized guest experience, so for whatever be your reason for the visit, you get the best of the best experiences
Doesn’t this sound like a modern-day palace that you always wanted to see or live in?
The Birth of a Dream
Back in the late nineteenth century, there was a dream. A dream of Swiss hotelier Céasar Ritz to establish a chain of hotels known for its world-class service and the best location, with beautiful rooms, amazing beds, and great meals.
The realization of this dream came to the Ritz’s doorstep sooner. He ultimately began opening luxury hotels throughout Europe, which sooner came to be known as The Ritz Carlton Hotel. This idea of the luxury chain of hotels was a new realization and a very welcomes gesture for the European elite.
Ritz’s elegant hotels were known for featuring the finest amenities, the most attentive and polished staff, and one of the best services and access to the finest restaurants in the respective cities where they started getting established.
The first Ritz Carlton hotel was established in the heart of France. Set up in Paris followed with many branches of the refined hotel being open subsequently, this brand of hotels was purchased more than a few times, leading to further international expansion and eventually leading to a bigger name among the world’s best and top hotels.
Known for its rigorous standards of providing its guests with a high-class experience, The Ritz Carlton Hotel brand was bought by the famous Marriott International in 1995.
The story of Ritz-Carlton ownership is a bit convoluted. Let me clear it for you. Original Ritz-Carlton by César Ritz in Europe. Post his death in 1918; his wife managed the hotel. Till 1983 the ownership structure was complex, which you can read on Wikipedia, and I will not go into it. William B. Johnson bought the Current Ritz-Carlton in 1983 for $75.5 Mn, and now Marriott International owns a 99% stake in the hotel.
So, what has been the journey of such a great chain of hotels? Has Ritz-Carlton adopted some kind of unique business strategy? How did it earn the value of the higher prices they charge and evolved to become the leading luxury hotel chain in the world?
The Ritz-Carlton Business Strategy involves training the staff for customer obsession
It’s not just the ambiance or the special rooms that make this chain of hotels or the overall experience of being in a Ritz hotel different. What really stands out for the Ritz-Carlton training session is their idea of meeting guests’ ‘unexpressed’ needs.
Throughout the decades, Ritz-Carlton has successfully managed to create a culture where bartenders, bellhops and front desk clerks instinctively meet these ‘unexpressed needs of their customers’
The employees don’t run around asking what they should be doing next but are fully empowered to create unique, memorable, and personal experiences for their guests through their own ideas.
For example, employees keep their eyes and ears open and record every guest’s expressed and unexpressed wishlist in the notepad they carry, and then they use their instincts to surprise and delight them.
How wonderful would it be, if you’re just admiring a bouquet of daisies in the hall to the dining area and suddenly when you go back to your room you found the exact same bouquet of daisies on your bed with a thankyou note from the staff.
Customer obsession at Ritz Carlton comes with culture of belongingness
Here’s a story that briefly talks about the culture and cares that every employee of Ritz-Carlton possesses for each of their customers.
Once upon a time, in San Francisco, United States of America, A guest who had just left the hotel called to say that their son had left his stuffed giraffe in the room. As the young kids are, very attached to their ever-beloved stuffed toys, the boy could not stop crying as he thought he left his favorite toy forever. The only thing these distraught parents could think of to tell their son was that the giraffe was staying on the vacation a little longer.
Taking this idea, the staff found the giraffe and clicked a couple of pictures showcasing the stuffed Giraffe enjoying its extra time on vacation. Well to think about it, most luxury hotels would have done that. But that was not enough for Ritz-Carlton.
Knowing what the parents had promised their son about the Giraffe staying a bit longer, the staff also included a photo album of the giraffe enjoying his extra stay. They took photos sitting by the pool, getting a massage in the spa with cucumbers on his eyes, and laying out on the beach. The parents were ecstatic. This overwhelming feeling of belongingness not only raised their expectations but imagine having shared this picture with their friends and family. Calls for a perfect Word of Mouth experience.
Customer obsession cannot be achieved without employee engagement
This was just one set of stories from 1000 other unusual stories of great experiences customers had during their stay at Ritz-Carlton. From local ones to around the world, these stories leave no stone unturned to keep their people fully engaged.
Engaged staff brings a diversity of ideas to the table, which allows for creativity and innovation. Jack Jennings
In fact, Harvard did a study on employee engagement. The study stated that the average company had 29% of their fully engaged employees, and they labeled this group as the ‘superstars.’
What came as a shock but a pleasing one was that Ritz-Carlton has 92% of their staff considered fully engaged. Because of this, they now hold countless service awards, and their customer service and engagement have always been labeled as top of the class, making them a tough competitor in the field.
Once Steve Jobs was asked “which company has the best customer experience?” The answer was Ritz-Carlton. There are many things about premium customer service that Apple learned from Ritz-Carlton. Check out the video below:
The Ritz-Carlton Today
So how does the famous Ritz-Carlton look today? With such great and unusual service, the hotel chain is known for its influence on service across a wide range of industries. The company has 108 luxury hotels and resorts in 30 countries and territories with 29,158 rooms, in addition to 46 hotels with 8,755 rooms in the pipeline.
Herve Humler is president & chief operations officer of The Ritz-Carlton Hotel Company, L.L.C. as of 2021. He is responsible for leading the brand’s operations, global growth strategy and championing its distinctive service culture.
Due to the creation of The Ritz-Carlton Learning Institute and The Ritz-Carlton Leadership Center, which then-Ritz executive Leonardo Inghilleri created, it has achieved immaculate heights in giving the best-in-class experience and a time to remember and look back on for every guest stayed and visited.
What can new-age entrepreneurs learn from the business strategy of Ritz-Carlton of extreme customer service?
Ritz-Carlton did not think of customer service as just a business vertical. Rather Ritz-Carlton made its core business strategy and kept customers at the center. Entrepreneurs cannot just go gaga over their creation (in this case, luxury hotels) if customers are not happy with the creation.
The giraffe story was one example of when Ritz-Carlton went a step further to make its customer happy. These are not just stories. These are feedbacks that your customers give to others. Extraordinary customer experience will build a loyal customer base no matter what your product is.
Best customer service cannot be achieved without the best and engaged workforce. Good pay and perks are not enough. Tell your people that you care. Give them challenging tasks. Staff should feel that they have a voice and see what innovative solutions they come up with.
This gives us more and more reasons to plan our visit and keep at least two days to experience the lavish and exquisite service of the lavish chain of Hotels and give your pandemic stricken self a good and well-deserved vacation.