Defining Loyalty: How to Win Over Loyal Guests, When You’re Not One of The Big Guys

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febbraio 16, 2016 di QUADRI E DIRIGENTI DEL TURISMO by Alberto Correra

The last twelve months have been full of change for all sectors of the
hotel industry. Acquisitions and mergers are a growing topic of
conversation in the industry as many expect them to pave the way for hotel
marketing in the coming years. One major impact being considered is the
changes to be made in regards to customer loyalty programs. With a new
direction and promise for personalization, independent hotels and small
brands must customize their rewards programs to compete with the big

Loyalty programs made their debut in 1981 when American Airlines paved the
way with a frequent flyer program known as AAdvantage . The goal was
simple- to reward frequent American Airline travelers and create a database
of its best customers. AAdvantage expanded its reach through partnering
with Hertz and Hyatt, allowing customers to further accumulate points
through rental car mileage and hotel stays. Later that year, Delta and
United released their own versions of this program featuring new rewards
such as a 500,000 mile enrollment bonus and no mileage expiration. Although
frequent flyers were the main focus of the campaign, most hotel companies
were reaping the benefits from airline packages. In 1983, Holiday Inn was
the first to launch its own  guest reward program, sparking competition
across the big brand hotel scene.

Today there are over 70 FFP worldwide serving 100 million members. For the
last 30 years, hospitality professionals have marketed to their customers
based on the fact that “Mileage is a basic consumer expectation, alongside
convenient schedules, competitive pricing, safety and customer service”
( The basis of most loyalty programs is rewarding repeat
customers with point-based discounts, with no real customer information
taken into account. As a result, loyalty is a very loose concept in the
minds of most travelers. “Even high frequency travelers only spend 58% of
their spend on their preferred brand, and 65% report staying with 2 or more
brands in the past 6 months” ( With a new generation of
travelers craving novelty, this cookie-cutter approach to loyalty programs
will no longer be an enticing deal.

In addition, recent mergers have made the loyalty environment even more
challenging for small chains and independent hotels. Now giving loyal
customers access to an even bigger pool of options, it has made joining a
loyalty programs even more enticing.

There are a few alternatives that hotels can do to keep up with the
competition. Many small hotel brands have started joining together to
create more appealing loyalty programs for a younger mix of travelers. An
alternate to these points based programs is based on customer data and
personalization. Small chains and independent hotels can begin to analyze
who their customers are, their preferences, and how they like to be
communicated with. One way to entice more loyalty program sign ups, is by
offering an upgrade or amenities add on from the very first visit. By
engaging customers from their very first stay, guests are likely to
associate the brand with the great value they received when booking their
next stay.

These types of programs can be maximized by personalizing which loyalty
programs features appear to which guest. For example, site visitors can be
targeted with personalized campaigns based on information like their
location, their referring source, or even the keyword they searched.
Engaging a visitor who is interested in the local nightlife with a
complimentary beverage or bar visit will (almost always) be more meaningful
than the family tour package.

Hoteliers believe that “travelers are burnt out on points and that what
they really want from a loyalty program is access to special perks and
experiences they wouldn’t be able to get on their own” (  Big
name hotels are catching onto this trend. Hiltons latest campaign reflects
the new direction of loyalty programs, with their tagline “Turn points into
experiences worth sharing.” The strategy for small hotel companies now is
to give travelers the personalized rewards and offers they are looking for
right away.

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