In an effort to land repeat customers (and increase direct bookings), loyalty programs are one of the most effective strategies out there. A study by Cornell University found that guests book 50% more rooms each year when they are involved in a loyalty program. That’s a lot of extra revenue!
Traditionally, these programs were the exclusive territory of chain hotels—which had the resources to create complex rewards systems and enough ubiquity around the world for frequent travelers to accrue and use points. But it’s 2017, and we don’t have to settle for outdated concepts. There are some excellent options for independent hoteliers to offer their own rewards programs and reap the benefits of improved guest loyalty.
It’s important to set up a program that considers your clientele and company culture. Think about the type of program that would best suit your business. Are you interested in a more traditional points-earned system? The new trend of instant rewards? Or maybe you want to come up with a creative blend of both!
The classic loyalty program is, of course, a points-based system. Customers earn points in proportion to how much they spend using a simple mathematical formula. When guests have earned enough points, they can be redeemed for free nights, discounts, etc. On their own, independent hotels have trouble effectively using this system because guests struggle to earn enough points to be worthwhile. Group schemes, such as Stash Rewards and Preferred Patron, mitigate this problem by creating a network of independent properties that benefit from a shared rewards system. In addition to providing your property with a loyalty program, group schemes can also expose your business to a wider audience.
While many still love point-programs, it seems a lot of today’s travelers find more value in unique and immediate rewards. Instead of making customers wait until they’ve accrued enough points for a free room or discount, these programs offer smaller rewards (think free WiFi, room service vouchers or a box of artisanal chocolates) for simple tasks like booking direct, sharing on social media and so on. This sort of instant gratification goes a long way with guests and is easier to manage as an independent property. If you’re interested in an instant-rewards program but uncomfortable managing it independently, look into partnering with a company like Stay Wanderful.
An Innovative Combination
Don’t feel limited by the two options mentioned above. With a powerful CRM (and a bit of creativity), you can design a program custom-fit for you.
The ‘Friends of the Brand’ program, offered by Kimpton Hotels, is a great example of an innovative alternative which blends a points-based system with personalized rewards. By using invisible credits, they award points to guests for a variety of actions (like positive reviews, sharing on social media and booking direct) as they see fit. The guests never know how many points they have, but at any time an employee can use them to surprise and delight guests with instant, personalized rewards.
Make it Accessible >> If you’re offering a points-based system, ensure that members can access and use their points easily. Consider using a mobile hotel app or online dashboard.
Communicate and engage >> Make sure to send emails, and engage with members on social media, so they don’t forget about your loyalty program. Send updates on their status in the program, suggestions for earning more points and ways to redeem rewards.
Know your customers >> Consider what it is your guests want. A personalized, thoughtful reward can be more appreciated and memorable than a generic offering of higher cost. Unique perks are what can set you apart from the competition.
Building customer loyalty is critical for survival in the hospitality industry. Think about adding a rewards program to win repeat customers and boost direct bookings.