CUSTOMER RELATIONTIONSHIP MANGEMENT ASSIGNMENT
TOPIC - CABO SAN VEIJO CASE
SUBMITTED TO – Prof. PRADEEP MAZUMDAR
SUBMITTED BY- RAJSHEKHAR CHOUDHARY
ROLLNO: 201822074
SECTION: C2DE
SUMMARY
Cabo San Viejo was established as a first and guiding health and wellness brand in Palm Springs,
California by Dave and Florence Blumenthal in 1977. Where smokers or individuals who are
overweight and others can think safer and teach to live happier and healthier life.Cabo San
Viejo’s mission statement says “Cabo San Viejo seeks to help people unlock their hidden
potential so they can become healthy, happy, fully self-actualized individuals”.
Cabo San Viejo offers numerous activities such as six gymnasiums, weight training rooms, squash
and racquetball courts, a meditation area, skin care and beauty salons, massage rooms, sauna,
steam and inhalation rooms, whirlpools, private sun bathing areas, four pools, a cross-training
pool, aquatic therapy, strength training equipment, a driving range, and a nine-hole golf course.
They also give a complete variety of spa facilities, with over 60 fitness lessons and events a week,
wellness conferences, stress management workshops, disease prevention and reduction of weight,
healthy cooking courses, dietary consultations, alternative health consciousness and spa
medications.
Cabo San Viejo can accommodate up to 288 people and aims at maintaining an optimal occupancy
rate (270) during the year. The rates for the rooms are per occupant and the minimum stay is 4
nights. Most people are quite involved and invest on accommodation and facilities an estimate of
$455 per day. Cabo San Viejo has approximately 3,500 new guests each year, 96% of whom enjoy
a pleasant stay.
In order to meet particular income and occupancy objectives, the advertising office manages prices
and sales. The marketing goal is not to educate people about Cabo San Viejo but to rather evoke
“the right emotions so people are reminded that they want to feel good.”
A new Cabo San Viejo awards / loyalty program is now being considered because it addresses the
problem of rivalry that now offers reward programs, increases revenues and encourages fresh
clients to come back with prizes.
What is good about Cabo San Viejo?
a) Offerings- They offer a large variety of services including six gyms, weight training, squash
and racquetball courts, meditation, hair treatment and beauty salons, massage halls, sauna,
steam facilities and inhalations, whirlpools, private sunbaths, four pools, cross training pool,
aquatic therapy, strength training facilities, a driving range, a broad variety of services In
addition to a broad spectrum of services they offer.
b) Staff- The employees at the hotel are very pleasant, experienced and skilfully educated, such
as private coaches, guest delivery personnel etc. in order to improve the visitor environment.
The employees are component of why the hotel has such elevated level of customer
satisfaction because of their commitment and capacity management.
c) Location - Located in Palm Springs, California, Cabo San Viejo draws clientele from all
over the world due to its strong reputation of being the best at what they do.
What is bad about Cabo San Viejo?
a) Pricing- Concentrated exclusively on those in high tax brackets. Because of elevated rates,
they miss a big share of their future industry, except when rates fall in summer.
b) Loyalty Programs- leading to jealousy, dissatisfaction, and certain individuals feeling rather
upset because of unequal treatment.
c) Sales and Marketing- There is no cross-functional promotion in Cabo San Viejo.
CaboDaySpas don’t advertise the Cabo San Viejo Health Resort and vice versa. This is a major
marketing tool which they miss because it requires no external marketing, it merely advertises
other services from within. The spas can readily publicize the hotel and do more to help visitors
enjoy greater vacations at places in Miami, in Hilton Head, or in Aspen.
d) Market segment- As figures demonstrate 70-80% of their visitors are women. Cabo sen Viejo
is missing out another market segment that is male audience.
What is the problem or what are the problems faced by Cabo San Viejo?
a) Implementation of loyalty program-
Few concerns that need to be kept in mind with regards to implementing such a system:
Customers are not concerned with monetary rewards; they are more interested in recognition
and preferential treatment as repeat customers,
Cabo San Viejo is worried about the idea of giving preferential treatment to some because they
are committed to making every customer feel like they are their most important customer, and
Customers of Cabo San Viejo generally have high incomes and classier tastes, so providing
the right kind of rewards is tricky because they need to be high end.
b) CRM system:
They have an outdated CRM system that is incomplete, expensive to replace.
Cabo San Viejo and the CaboDaySpas CRM systems are not currently connected (cross-
functional) which means that without a new system, they are not able to link rewards among
various locations.
c) Aging Customer Base:
They presently have an elderly client base, which implies that it is important to attract younger
crowd to remain profitable. However, younger individuals have grown accustomed to rewards
programs, and in many cases expect it
According to you what is/are the solution/solutions? Justify your solution/s
There are two solutions that Cabo San Viejo can implement such as
a. Option 1 – Loyalty Programs
b. Option 2 – Memberships
We recommend that Cabo San Viejo implement the strategy outlined in Option 1(loyalty
programs). Implementation of a rewards program at the CaboDaySpas will give price-sensitive
repeat day spa customers a chance to experience the overnight resort at a substantial discount. The
customer recognition program and newly installed CRM system will ensure that repeat customers
at all Cabo San Viejo locations will feel valued as loyal Cabo San Viejo customers.
Also option 1 is
a) It is cost effective
b) Implementation of the rewards program will increase functional value, while the customer
recognition will increase emotional value and social value
