Canyon Ranch CRM With Two

Canyon Ranch CRM with two more pages

Should Canyon Ranch implement a CRM strategy?

Canyon Ranch needs a CRM system to stay competitive in their industry and retain customers. For Canyon Ranch, the relationships and trust they have with their customers is where their profits come from. Knowing their customers better and tracking what their preferences are, is key to being able to attract them back to the resort. Their customers are older baby Boomers with enough disposable income to afford spending $2,000 to $2,500 a stay. Canyon Ranch executives need to realize that their customers are purchasing the experience of being in a world-class spa, not just the immediate health and beauty benefits of the treatment. Implementing a CRM strategy will make it possible for Canyon Ranch to better understand their existing customers and create programs that fit their needs. They will also be able to attract new customers using the lessons learned from serving their existing customers too. Finally, Canyon Ranch will be in a much better position to understand how and why their spa experience is different than anyone else by staying in close contact with customers. All of these benefits are possible with a good CRM system.

2. Does a CRM Strategy fit with overall Canyon Ranch positioning?

It fits with the overall Canyon Ranch positioning perfectly. As the typical Canyon Ranch customer is high-end and can afford to spend a lot of money on spa treatments and a stay there, this should tell their senior management team that what these guests are looking for isn't just the treatment, they want an experience. They want to know they are special and that they are unique there. A good CRM system will allow for personalization of each treatment plan for each customer, and also give Canyon Ranch the ability to track customer satisfaction as well. For Canyon Ranch, in such a competitive business to succeed, they must be seen as very trusted and valued by customers.

3. How do you judge their current use of CRM concepts?

Their current IT systems are for the most part useless in tracking customers. They are not connected with each other, and there is really no way of knowing which customers are the most or least loyal, why, and what can be done to improve the overall customer relationships. They are way behind their competitors in their use of CRM systems as well.

4. What should Canyon Ranch Destination Resorts CRM initiative look like

The initiative needs to focus on each type or segment of customers the ranch serves. Having this level of detail by customer segment or even customer type will help Canyon Ranch more effectively plan its promotional, selling and service strategies. The CRM initiative also needs to show how the Destination Resorts deliver an exceptional experience as well, because that is what the customers are paying so much money for. They want to not only come back from a trip there feeling refreshed, they want to have a good time there too, which is the experience factor of Canyon's marketing.

New Answer

How should canyon ranch leverage its uniqueness in the face of increasing competition and against entrenched customers' beliefs about the firm as a world class spa?

Canyon Ranch needs to put the customer at the center of their business and realize that if they are going to hold onto the customers they have, they have to start listening more. Their existing IT systems aren't nearly well organized enough to make this happen. To leverage their uniqueness, putting the customers at the center of their company is the first place to start. A good CRM system will do this, making every department and functional area of the company accountable for how well they meet customer needs. This is one of the reasons why analytics is catching on so quickly within CRM today with so many companies offering it as a feature.

The second step that Canyon Ranch needs to take to leverage its uniqueness is to recruit its best customers as champions of the resort. These rich people love to talk about their experiences and leave others guessing about how much they spent; that is part of the status appeal of this resort. Giving them the honor of speaking on video and being shown on the website will be a huge win for the Canyon Ranch brand. This can be achieved by using the CRM system to find the best or most valuable customers overall.

Third, Canyon Ranch needs to start thinking of each customer like a celebrity or rock star. That is what these upper income customers want in an experience, while also getting some treatments to see transformation in their appearance. Giving customers the chance to be rock stars will be a major victory with the CRM system.

New answers -- third section

What is the value of customer information to Canyon Ranch?

Canyon Ranch is a service business that needs to always be thinking about ways to get customers to come back and spend on visits. A good service business knows how to make promises about their performance and deliberately exceed them. The best airlines, hotel chains and many other service businesses are great at this; they have a very good idea of where their customers' expectations are and how they can consistently deliver service beyond them.

Today Canyon Ranch has no idea where, exactly, their customer experiences are. They can't figure this out just by walking around and asking customers either. Customer information captured over time will however give Canyon Ranch managers a very good idea of where they are meeting, exceeding or falling short of customer expectations. And that knowledge is critical to their overall success. A customer information system at Canyon Ranch when integrated to their financial reporting system will show exactly which customers are spending for which spa services. They will be able to even define profiles of the customers visiting each spa treatment program. These customer profiles can then be used for creating, fine-tuning and measuring marketing programs over time. The value of customer information becomes very clear when marketing campaigns designed for each of these customer profiles and their market segments start showing increased sales. Canyon Ranch needs to build customer loyalty and having a CRM system will give them the insights they need to do this faster than just by trial-and-error like many do today.

As CIO (Chief Information Officer), How would you make the case for customer relationship management (CRM) and business systems at Canyon Ranch?

I'd start the case by saying this business lives and dies by repeat purchases and customer loyalty. No doubt the internal systems, as disconnected and broken as they are, still show that Canyon Ranch's most profitable months have been when repeat customers have come back and spent more. A good CRM system integrated to business systems will tell management not just how much customer loyalty earns them in terms of sales and profits, it will also say why. Secondly I would point to how valuable these high-end spenders are and how attractive they are to competitors. If Canyon Ranch doesn't make a move with CRM, competitors will and the customers may eventually be lost. The time is now to get moving on a more customer-driven IT program to make sure Canyon Ranch holds onto its customers.

What impact would you anticipate these systems to have on the Canyon Ranch strategy and capabilities?