Although some hoteliers place little or no importance on their customer loyalty programs, studies have shown that these reward programs are outstandingly effective in driving guest bookings and promoting customer satisfaction.
We have thus attended to the need for elucidating some of the benefits of customer loyalty programs in the hospitality sector.
A lot of studies have gone on to establish that guests with high points often stick with a particular hotel whenever they travel.
Well-known hotel chains have begun thinking about their loyalty programs thanks to outside forces’ pressure and the over competitive industry. On top of that, the industry has been consolidating such as the Marriott International buying of the Starwood Hotels and Resorts
We have covered in this article the key benefits of customer loyalty programs in the hospitality industry and some of the best customer loyalty programs in the hospitality industry.
Importance of Customer Loyalty Programmes
- Helps Retain customers
After the Starwood acquisition, Marriott’s initial move was letting members of both hotels link the accounts to earn and redeem points at the merged companies’ 30 brands.
It’s a sign that hotels do care about loyalty programs as they help in retaining their customers.
It’s also a great way to stay connected with existing customers.
- Promotes direct booking
Direct bookings mean added profit. In the current era of price war due to competition, hospitality companies would never want to lose money on commissions to online travel agencies.
So, it’s best ideas to add a first time discount for direct booking by enrolling them in the loyalty program.
This is even more important for repeat customers. One of the key benefits of customer loyalty programs can be the price competitiveness and ease for repeat customers.
Along with the increasing number of lodging competitors – HomeAway and Airbnb – well-known hotel brands are attempting to convince travellers to reserve their rooms with them instead of Internet travel agencies like Expedia or Travelocity. Hilton Worldwide, Hyatt, Marriott, and Choice have begun providing discounts to their guests who reserve rooms through the hotel’s channels instead of travel agencies, but they have to become loyalty program members as well.
- Is great for your company’s brand
A well-managed customer loyalty program is definitely valuable for your hospitality brand.
A nice card or a digital loyalty card, regular emails, direct bookings, more website visibility due to login and much more. It all adds to the visibility of the company which makes your brand more valuable.
Moreover, these programs are part of excellent hospitality service and are customer friendly. These are thus a great bonus for your brand.
- Gets you more referrals
Nothing can be a better ploy to get more referrals than flashy customer loyalty programs.
Give it a pretty name that resonates with your hospitality brand and keep additional discounts and offers to go with it for in house spends.
Food coupons and gift coupons to go with it makes it a great mixture for travellers to speak about. It adds to their experience and thus more and more customers refer the loyalty program to their friends, family and acquaintances.
- Is a Show of Gratitude
An excellent customer loyalty program is always a surefire sign that you actually care about the guest.
It’s a monetary way of saying “thank you for booking with us.” That in itself can do wonders to your customer relationship management in the hotel industry.
- Points + Pay helps in getting repeat customers
Points plus pay is primarily an avenue for customers to redeem a small number of points for their next stay. It makes more sense this way.
In the past, customers have always neglected the significance of loyalty programs because one needed to garner high points to redeem a meaningful reward.
Best Customer Loyalty Programs in Hospitality Industry
Most hoteliers create alluring customer loyalty programs or hotel reward programs to increase footfall, enhance customer satisfaction, and deter clients from defecting to their rival hotels.
Over the years, we have seen top hotel brands across the globe trying to outdo each other when it comes to all things regarding customer service and satisfaction. And for good reason.
That is why customer loyalty programs or reward programs are must-have in every hotel.
Also popularly called frequent guest program (or just shortened FGP), customer loyalty programs are designed to influence consumers’ purchasing decisions.
These points, in turn, are redeemable for anything from hotel room upgrades to a free stay and everything in between.
Almost all of the large hotel chains have their own reward programs. To gain every single customer hotel is changing the game of how customer loyalty programs work.
Let’s have a look here at some of the best hotel reward programs in the world.
- Hyatt’s Reward Program
Hyatt Hotels Corporation has unveiled its new loyalty program, which would create three new elite tiers and compensate guests for staying at the hotel and spending money on drinks, food and the spa.
For instance, the Hyatt Gold Passport program is set for rebranding in the World of Hyatt with three tiers – Globalist, Explorist and Discoverist. Guests advance in tiers based on either base points of a year or qualifying nights.
Hoplamazian said, at the moment, there are only two tiers, which are determined by stays and nights. It takes people more nights in the hotel to get to the first elite tier.
He said there are compelling benefits at each program level. There are various customs to partake in at the Hyatt and attain benefits that were in the previous program.
Base points may be earned and used on spa treatments and dining.
Guests may earn them a free night after they’ve stayed at five different Hyatt brands, which includes 12 brands and more than 660 properties.
Elite members can attain suite upgrades when they reserve their rooms.
- Wyndham Rewards Program
Wyndham Rewards said it was adding 17,000 homes and condos to its hotel’s roster that guests can earn and redeem their points.
At present, there are 8,000 Wyndham hotels around the world that accept the redemptions.
Wyndham Rewards is going another way with bringing in new customers. The hotel management understands that not everybody wants to stay in a hotel. For quite some time, the hotel was a vacation rental arm.
Wyndham has changed its rewards programs so that guests can redeem their hotel stay at 15,000 points – extremely low for the hotel industry. Vacation rentals are permitted at 15,000 points for each bedroom a night.
Noah Brodsky, head of loyalty at Wyndham Rewards, said loyalty programs have become extremely complex.
People have no idea what they have to earn, redeem or the costs. While it began with airlines, it spilled over into the hotels.
- Choice Hotels Program
One of the most innovative hotel chains over the years has been Choice Hotels.
Choice Hotels has already revamped its Privileges program, which lets travellers who stay during the weekday to earn instant gifts like fuel savings at Shell locations, extra airline miles or points or credit at Uber and Amazon.com.
The idea is to bring in new customers, as more people are being lured into a stay at alternative lodgings like vacation rentals. It is another vacation rental arm that lets its guests earn points while at the hotel.
It won’t be long, the company said, it would let people redeem their points too. According to CEO of Choice Hotels Steve Joyce, the changes Choice Hotels made to its program were done to attain the attention of more Millennials – the age group that spends more money when they travel.
To date, the company has seen 4.5 million new members for its Privileges program.
Besides the Amazon and Uber benefits, Choice Hotel’s loyal guests can download gift cards through the mobile apps and use their points to get free nights at discounted levels at hotels who participate in the program.
- Hilton HHonors
Arguably the hotel reward program with maximum members. Over 100 countries and close to 5000 hotels are covered.
The fine print section is small and the pros of the plan outweigh the cons by a large margin.
Benefits of Hilton HHonors hotel reward program:
- Hotels options from budget hotels to super luxury properties
- Benefits can be available anytime and anywhere
- HHonors is clubbed with air miles and points can be earned or redeemed for both air travel and hotel stay.
There are also several hotel loyalty programmes that will provide you with cashback.
With most of them, you also have the option to receive a gift card for places like Amazon, Best Buy, bitcoin, American Express, Starbucks, Target and so much more.
A lot of other hotel reward programs through the Best Travel sites make the options all the more interesting.
If you own a hotel or are a hotelier, it is important to appreciate the importance of customer loyalty program.
The secret sauce of success in the hospitality industry is to know the art of hiring and retaining the best talent. Thus External Customers and internal customers must be treated alike.
Apart from the points+pay approach, you also need to put other measures to make your customer loyalty program work better.
For one, you need to establish a ladder system of redemption.
What does this mean? It implies that the guests earn higher quality points as they move up the ladder of points.
There is a scope of an array of perks being offered along with these customers loyalty programmes. It gives your organisation ample opportunity to stay in the memory of existing customers and reach out to various new customers.
These programs also give the organisations an opportunity to promote new offers and stay ahead of their competitors.
The benefits of these loyalty programs can be many for your organisation. So, if you don’t already have implemented such loyalty or customer benefit programs then it’s time to set up one immediately. You will be glad you did.