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Marketing Spotlight
The Ritz-Carlton
The Ritz-Carlton Hotel is an American luxury hotel chain that operates 91 luxury hotels and resorts in 30 countries. The company receives high praise for its excellent service and is recognized as the gold standard in the customer-service department. By exceeding customer expectations, The Ritz-Carlton has become one of the leading companies in luxury hospitality.
The Ritz-Carlton, which began as The Ritz-Carlton Investing Company, was founded by Albert Keller in the 1900s. The company had built several hotels along the East Coast in cities such as Boston, Philadelphia, Atlantic City, and Boca Raton. However, by 1940 the company disbanded; all but one hotel had been closed down and sold off because of financial difficulties brought on by the Great Depression. The Ritz-Carlton in Boston continued operating (it was sold in 2006 to Taj Hotels) and built the foundation for future hotels. It featured private baths in each guest room, gourmet cuisine, personalized guest experiences, and many more amenities that contributed to a premier luxury experience. In 1983, The Ritz-Carlton Hotel Company was formed. Led by new management, Ritz-Carlton expanded around the globe, adding new properties across the United States, Asia, and Europe.
The cornerstone of The Ritz-Carlton’s success is customer loyalty achieved through exceptional customer service. The customer-service experience is defined by The Ritz-Carlton’s Gold Standards, which reflect the values and philosophy by which The Ritz-Carlton operates. The Gold Standards can best be described by its mission statement: “The Ritz-Carlton is a place where the genuine care and comfort of our guests is our highest mission.”
Source: Richard Croft/Alamy Stock Photo
To ensure consistency in its interactions with customers, in the 1980s The Ritz-Carlton standardized the language used by its employees. Management created a distinct style of speech with phrases like “my pleasure,” “right away,” and “We’re fully committed tonight.” Over time, these phrases began to sound insincere because employees used them in situations where they didn’t fit. When employees said that it was their pleasure to unclog sinks or clean bathrooms, guests took notice. Surveys indicated that guests believed interactions with Ritz-Carlton employees had become too robotic. The Ritz-Carlton acted on this feedback and shifted its language standard to focus on more authentic, unscripted conversation. The Ritz-Carlton now features more relaxed guidelines for addressing guests; these are still thoughtful and respectful but feel genuine.
A distinct feature of The Ritz-Carlton’s customer service is that employees are fully empowered to provide unique and personalized service. Employees are encouraged to make guests happy using any means, without having to consult a supervisor first. There are many stories of employees going above and beyond to provide the “Wow!” factor. For example, when one hotel’s food and beverage director noticed a stain on the back of a returning guest’s coat and asked what happened, the guest said it was an old stain he couldn’t get out and mentioned that the coat was one of his favorites. After the conversation, the hostess collected the coats of the guest and his family to hang up while they ate lunch. Meanwhile, the restaurant team whisked the coat to housekeeping, which managed to remove the stain. The guest left delighted.
At The Ritz-Carlton, each and every employee is allowed to spend up to $2,000 per day per guest to solve customer problems or make their experience memorable. One of the most famous incidents occurred at The Ritz-Carlton, Shanghai. A guest came into the hotel wearing a business jacket matched with casual Hawaiian shorts. The guest told the front desk agent that his slacks had been ripped at the airport. Because the guest had an important business meeting the next morning at 10 AM, the agent offered to see whether housekeeping could repair the pants. When the pants proved irreparable, the agent headed to a shopping area in Shanghai early the next morning to resolve the problem. After searching through many stores, the agent found and purchased a pair of pants that matched the original pair almost exactly.
To constantly improve its customer-service practices, The Ritz-Carlton gathers a massive amount of data on hotel operations, services, employee behavior, and general feedback, which is used to create a customer management system referred to as the “The Ritz-Carlton Mystique.” These data on specific aspects of guest behavior enable The Ritz-Carlton to craft personalized experiences prior to guests’ arrival at its locations across the globe. Employees take note of guests’ preferences such as temperature settings, food and drink choices, room arrangement, and amenity selection.
The unwavering dedication to perfecting the customer experience has made The Ritz-Carlton a symbol of customer-service excellence. In return, The Ritz-Carlton enjoys lasting customer loyalty, with the average Ritz customer spending more than $250,000 in the course of a lifetime. The Ritz-Carlton also has added The Ritz-Carlton Residences to its portfolio. These residential condominiums in cities and resort destinations are characterized by the same Ritz-Carlton service, management, and amenities offered by its hotel locations.78
Questions
How does The Ritz-Carlton service match up against competitive hotels? What are the key differences?
Discuss the importance of the “Wow!” stories in customer service for a luxury hotel like The Ritz-Carlton.
What are the key aspects of The Ritz-Carlton corporate culture? What role does the corporate culture play in enabling the company to deliver a superior customer experience?
