If your hotel isn’t part of a loyalty program and you’re thinking of setting one up to boost your revenues, take advantage of repeat business, and stimulate direct bookings these are some of the factors you should have in mind during the design phase. Alternatively, if you already have a loyalty program but it doesn’t seem to be delivering the right results, you might want to consider tweaking one or two things to make improvements.
Simplicity is a policy to be applied to every aspect of your program. It should be simple to register, simple to understand, simple to obtain the rewards, and simple to promote. Over half of all loyalty program members don’t actually engage actively as members. This is a huge waste of potential, and the main reason is over-complication.
Too many programs are based on gathering points, with the result that only the very ‘best’ customers who reach the top of the ladder will truly reap the rewards – and they’re often the corporate travellers who would be staying with you anyway. The rest will quickly lose interest. The answer is to structure the program so that smaller rewards are available much more quickly. Customers don’t want to wait for their rewards, and they certainly don’t care about a program where they know they’ll never reach a level which actually gives them something they value. Therefore you need to provide something when people sign up, and perhaps some additional membership benefits (free wifi, late check-out, etc) which apply to members from the start.
If your system is points-based, consider making the rewards available for a combination of points and cash. There’s nothing more frustrating than a scheme for which you’re almost in a position to enjoy a reward – but not quite. Customer frustration isn’t the aim of a loyalty program, nor is it your job to teach your guests the benefits of delayed gratification. Keep your members happy and engaged with rewards, and they’ll ultimately reward you.
If you’re part of a large hotel group, one of the member advantages of the loyalty program is that rewards are available worldwide. The program therefore rewards loyalty to the group rather than the individual property, though of course each property will gain bookings as a result of the scheme. For independent hotels, there is no opportunity to redeem points in another city. However, you may still have the opportunity to build partnerships with local businesses. Whenever you do get repeat business through your program, these customers may want to take advantage of preferential treatment at other business outlets nearby. Discounts on green fees at the local golf club, or discounts on local transport are all worthwhile perks. If you can enhance your guests’ stay, they are more likely to provide positive reviews and make return visits in the future.
4.Good communication with members
One further reason for loyalty program members’ failure to participate actively in the schemes they have joined is that they are not sufficiently well informed of their status, the type of benefits on offer, and how they can go about claiming their rewards. With this in mind, it’s very important to communicate this information clearly and frequently through channels of your members’ choosing. If you do it by email, make sure it is a mobile-friendly format. If your participation rates seem to be a little on the slow side, check to make sure your members know what they’re entitled to, as there’s a good chance they simply aren’t aware.
5.Value over discounts
The final point to remember is that your loyalty program isn’t a discount program. The aim is not to give things away. The aim is to actually encourage guests to spend more, and spend more frequently, and the way to do this is to offer better value. A discount on a room won’t necessarily help you when you’re selling to a loyal customer, but a discount on the third night when two nights are paid for probably will. Similarly, there will be products or services which may be highly valued by guests, but which cost little to provide. These should form the basis of your loyalty program offers, allowing you to increase customer satisfaction at minimal cost to yourself.
Whatever your specific reasons for starting a loyalty program, it is important to keep those objectives in mind and stay true to them. Always ensure that every decision you take is made with your hotel’s objectives in mind, and keep your loyalty program working to achieve your goals.