I am a proponent of Hotwire. If you are not familiar with Hotwire, it is an online travel service that makes customers go blindly in booking hotels and renting cars because they offer really good rates. Say you want to stay in Paris and you would like to be in the La Défense area. You simply go to Hotwire, select the region and they give you hotels at various star ratings and prices. Pick the star rating and price that fits you, pay for the booking, and then your reservation is set and the hotel (or car, or airline, etc.) is revealed. In Paris, our hotel was significantly lower than the price that others were paying. For the same car rental in NYC, I would have paid $200 more on a rental that I am paying $220. I believe they can do this because their system accounts for like vendors surplus, and they can offer great deals by combining the surpluses and passing this discount to customers. But this system doesn’t always work out.
One of the most important aspects of services marketing is trust. Because the offering is intangible, consumers therefore must be able to rely on any information that is given in the selling process when making their purchase decision. Hotwire works because they can say, in effect: “You may not know what hotel, or car, or airline you are getting—but be rest assured that it is as good at least as Brand A, and better than Brand B.” So, let’s say that you want a 5 star experience and when making the purchase, they reveal that you just purchased a 3 star. If this happened with any volume, their unique selling proposition is destroyed.
On a smaller scale, that is what happened to me just recently. I simply didn’t want to stay in Hotel A, and their site stated that hotels like Hotel A would be considered such-and-such rating. So, I purchased the next level up, and, to my surprise, I was awarded Hotel A. I went from advocate to what Seth Godin refers to as an “angry person“.
So I called, and the customer service rep said it wasn’t fair to me to have all of Hotel A hotels rated as such-and-such rating, they look at all places separately, and so on. He obviously doesn’t read Seth Godin’s blog. For the most part, I didn’t want a refund or a discount or anything similar. I just wanted them to promise to do something about it. I wanted my trust restored. So I wrote. And wrote. And wrote. And, they wrote back:
Thank you for contacting us regarding your hotel reservation […]
I understand you contacted us four days ago about the star rating on your hotel reservation at [Hotel A] I apologize you did not get a response because notes on the account show you had called in to discuss this issue.
Thank you for the feedback you provided us about [Hotel A]. Customer feedback helps us ensure our properties continue to meet the high quality standards we expect from all of our partners. After receiving feedback from you and other guests, we re-evaluated the [Hotel A] and adjusted the star rating.
And then they offered a refund and other steps to address my concerns. Trust restored. Advocate reactivated. The steps taken were minor, but the effect is huge. Services, which represent the future of so many organizations, cannot overlook the sizable need for establishing trust.