Design an Effective Hotel Guest Loyalty Program to Increase Hotel Bookings and Revenue

The hospitality industry, like any other industry in this cutthroat competitive era is massively overcrowded, implying that many hotels, big and small, have swarmed the industry in the recent past offering ample choices to the guests, or perhaps spoiling them. A traveller could now easily switch to any property where he wishes to stay in any desired location, basis his/her requirements. For the hotels, in such a scenario, having the same traveller become their loyal customer or even visit their property again becomes an extremely prestigious account. Repeat guests, as they are referred to, are therefore very important for any hotel and there is enough matter to support the same. Research suggests that repeat customers spend an average of 67% more than new customers. Moreover, it also costs five to ten times less for a hotel to retain existing customers than to attract new ones. Hotels across the globe are therefore making enormous efforts to hold on to their existing clientele and develop a list of loyal guests, which they can cater in a special way.

Designing a great guest loyalty program has become more important than ever. It is one of the most successful ways to boost your hotel’s repeat business and turn your guests into your brand advocates.

While designing a guest loyalty program that works best for your hotel, there are some broad, guiding principles, which if adhered to would ensure maximum results besides a significant improvement in the hotel’s repeat business.

a) Know Your Guests Well – Who is your guest? What are his preferences, and what kind of rewards would appeal to each of them individually? These are some of the important questions, the answers to which would allow you to gather maximum information about every guest visiting your property. Therefore, design a guest loyalty program that could even be customized to get the most benefit out of it. By being able to tailor your loyalty offerings, you would be able to give your guests exactly what they want, and therefore deliver value for money and guest satisfaction. This, in turn, strengthens your relationship with the guests and increases the chances of higher retention.

b) Make it easy for them to earn rewards – Do not devise a reward program which is stringent or which makes it difficult for the guests to redeem its benefits. The guests, at times, lose their belief and interest in any such program that takes longer to avail its benefit, or perhaps, which has a host of rules and conditions to adhere. The rapidly evolving traveller, especially the millennial traveller, demands instant gratification and do not enjoy the complex structures to avail any loyalty program. Therefore, to make it effective, keep the guest loyalty program simple, easy-to-understand and quick to deliver.

c) Promote Engagement with the Guest – You should aim your hotel loyalty program to establish a deep emotional connection with your guest, for which repeated engagement and interactions can prove to be extremely helpful. Offer your guests the rewards for simply updating their personal details at the hotel reception or availing membership of any prestigious group within the hotel. Offering rewards for performing the simplest of activities can go a long way in establishing their trust and commitment towards the brand. An elaborate and extensive reward process would also tickle some excitement for the guest, while also proving beneficial for the hotel, as it gets a fair chance to collect accurate data and drive maximum engagement.

d) Ensure maximum value to both parties – Design your program in such a way that it delivers high value to your guest, while also being cost-effective for the hotel. Delivering value to the guest does not necessarily mean offering them monetary discounts, which could actually diminish the value proposition while also being cost-strenuous. Rather, providing them free access to any of the key services, which are otherwise chargeable for all other guests could be the ideal way to go. This would again require knowing your guests comprehensively so that you can offer only those free services to them, which they individually desire and appreciate. The key is to hit the nail right!

e) Embrace New Technologies – Chances are that the tech-savvy traveller of today would get more attracted to a loyalty program that is supported by the latest technology. Gone are the days when you would witness any visitor devoting his precious time sitting in the lounge area to view the rewards book or pamphlet, with millions of details packed in it. A program, promoted by the use of this old-fashioned way would hardly have any takers. Therefore, hotels must strive to make excellent use of the recent technology and come up with innovative ways of developing and sharing the reward program with their eligible guests.

An online structure to view the program details and fill the guest information is one of the most convenient ways appealing to travellers for long. A mobile app is also a great way to facilitate the smooth execution of the guest loyalty program. Moreover, loyalty cards issued to frequent travellers also work really well, as the hotel could easily track the developments and reward redemption patterns of any particular guest, so that you can devise better ways of customer involvement.

f) Make loyalty members feel extra special – Customers are the biggest asset for any business, but repeat customers are definitely the most valuable ones. Making them feel extra special could help the hotel win their loyalty for life. Offer personalized services based on the extensive information about those guests stored in your records. Make efforts to engage with these guests more often through various modes like e-mails, surveys, social media, and blogs, etc. Delight them by offering benefits that are beyond the normal package. For example, if a hotel is aware that a particular guest likes to visit the hotel’s casino or a spa during each visit, then entice this guest with a free or discount on the entry to the casino or spa. By doing this, you are making sure that the guest is overjoyed, which would make him return to your property.

Loyalty programs are definitely a great way for the hotels to make it big and gain a competitive advantage over others. Hence, it is important to design them with due diligence and implement them in the best possible manner so that it becomes one of the top deciding factors for your guests to return to your property. What is important is to keep these programs simple to redeem, meaningful and flexible so that it makes a lot of sense to all the frequent travellers to use it. Moreover, as your list of loyal customers gets bigger with time, you are also enhancing your chances to have a better Net Promoter Score.

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