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August 29, 2019

Hotel Loyalty Programs: Successful Programs.

In this series we're discussing hotel loyalty programs. Our last posts ran over some of the do's and don'ts, today we'll see what elements are common to successful programs, and then we'll see how to build a loyalty program that works.

Successful hotel loyalty programs usually send personalized -- note that -- emails to loyalty club members, showing that the hotel knows and remembers the guest's personal preferences, booking habits and that the hotel very much looks forward to serving them again.

This is not an email blast, this is an email that could only have been properly addressed to the recipient. Of course the same email could appeal to more than one person, but the offers and rewards are determined to appeal to everyone who receives it.

Useful loyalty communications do two things: Reward guests for past purchases and incentivize them to future purchases. This means the rewards are based on the personalized information you have about that guest -- don't offer spa treatments to an elderly businessman who has never visited your spa. Push the edge of the envelope, fine, offer incentives broadly appealing, but your offers need to reflect the best personal preference information you have about that guest.

Successful loyalty programs also offer benefits for referrals. Most people value friend and family recommendations above everything else when making purchase decisions, so this is behavior you want to encourage.

Effective loyalty programs also make joining up appealing, in that they offer rewards pretty much just for signing up. Airline miles programs do this when they offer 50,000 miles just for enrolling in the program. With that and the first trip the new inductee sees quick benefits. "For example, hotels might offer complimentary internet only for those customers who have registered for the loyalty program or they may offer a free room service meal for signing up," notes travel writer Bharat Lall. "One hotel chain allows new members to choose two bonuses from a list that includes spa credits, late checkouts, free breakfast, and complimentary laundry service. These immediate perks get customers engaged and help build brand loyalty."

Next time we'll see how to get really creative.