hotel loyalty programs, hotel guests, loyalty programs

Are Hotel Guests Really Loyal To Loyalty Points?

Customer loyalty is one of the most important aspects of a successful business. For large brands, this is especially true as customers may choose to consistently only stay at one brand regardless of where their travels take them. On the flip side, a smaller, independent hotel may become a local favorite for visiting guests if it wins their loyalty after the very first stay. 

From a monetary standpoint, loyal guests cost less to recruit and will potentially spend more on a given property with each repeated stay. Enthusiastically loyal guests can become a steady source of referrals, often bringing friends, family, or business associates with them when they return again. For a hotelier, there is no question that loyalty is valuable. But what about loyalty programs?


Hotel loyalty points can create loyal customers

A hotel’s loyalty program can inspire and reward loyalty in its guests. However, not all rewards programs (or guests) are created equal. There are many program models that are ineffective, leaving guests unlikely to join regardless of how well-implemented the program may be.

A properly implemented loyalty rewards program is designed to quickly help guests transition from the early stages of loyalty to the late stages of profitability where it takes very little to convince guests to come back. These programs should create a two-way street in terms of loyalty – one where your brand responds to loyal choices by making each stay more rewarding than the last.

In these situations, guests respond to two important factors; repeating great guest experiences and claiming earned rewards.

If your loyalty program isn’t built on these principles, then you may not be seeing the results you are looking for.

Implementation is everything

The way you implement hotel loyalty points is everything. You should know which models to follow, and which to avoid. For example, frontloading your guests with points to spend might inspire more signups, but also encourages service-hopping meaning guests look for more first-visit deals elsewhere.

Your goal should always be to impress your guests with the quality of their stay so they know they can rely on you for a great experience. Hotel loyalty points are meant to build onto this desire for another great stay by giving your guests a reason to come back and – once they return – a reason to spend time and money inside your hotel.

A hotel rewards points system should:

  • Be easy to join and provide early stay-improving opportunities
    • Easy online sign-up
    • Mobile app room service and concierge
    • Immediate membership deals, opportunities, or discounts
hotel loyalty, hotel guest, hotel loyalty programs
  • Incentivize on-site spending and experiences
    • Offer rewards that lower the cost and improve the experience of guest stays
    • Offer discounts that inspire further spending
  • Increase rewards over time
    • Reward guests for returning with each stay
    • Reward guests for returning over many years
  • Incentivize referrals
    • Offering rewards to the referrerreferer and referred
  • Make guests feel special and appreciated
    • Greet loyalty guests by name
    • Adapt to provide personalized experiences for returning guests
    • Surprise guests with stay-improvements and cost reductions

Rewarding desired behaviors with desired rewards

One big difference between loyalty programs that build loyalty versus those that don’t is rewarding desired behaviors. Simply offering deals and discounts is not a reliable way to build a functional loyalty rewards program. Instead, your goal should be to reward loyal actions in a way that inspires future guest choices.

For example, providing points for repeat stays and longer stays gives guests a sense of fulfillment. Adding on further rewards such as free desserts, room upgrades, and reduced prices on their future stays reinforces why they choose to stay loyal to your brand.

identifying valuable guests and inspiring loyalty with appreciation

Artificial intelligence makes it possible to personalize appreciation for your best guests on an increasing scale. While one hotelier and their staff can often identify your best repeat customers, the larger your customer base, the more beneficial it is to rely on algorithms to identify customers who leave good reviews and spend money at the property. 

Reward return guests by remembering them, even if it’s with the help of a program. For example, your loyalty detection algorithm may remember that one guest always asks for extra towels. If this is the case, place extra towels in the room before they arrive. You might also send a guest’s favorite room service order to the room on the house after their third or fourth stay. Not only will your loyalty points incentivize guests to return, but your automated system can help you provide that special personalized touch that inspires true loyalty.

You should also allow your hotel staff to add a note to customer accounts (and perhaps provide extra reward points). This is an opportunity to make note of guests who regularly make special requests.

Identifying customer preferences and rewarding guests is crucial to fostering loyalty and appreciation. Ultimately, the most successful loyalty programs prioritize this regardless of how large the property or customer base is. 

hotel loyalty, hotel guests

Increasing the value of loyalty over time

Lastly, make sure the value of being a repeat customer increases over time. The best reward programs avoid the fallacy of front-loading rewards and instead provide a gentle yet steady increase in rewards over time. Each time a guest stays, and each night they stay, may increase the total capacity for rewards they can receive.

Include extras like rewards for booking anniversaries and special events at the hotel. Offer rewards that can only be claimed after building up several stays worth of points, encouraging guests to keep coming back in order to complete their “initial investment” and make full use of their points. You can also offer extra perks like complimentary dessert or airport shuttle rides to long-time guests that don’t necessarily require spending points. 

Make sure that guests feel that coming back again and again is not only a good choice, but likely to yield greater rewards over time.

Creating loyal guests with your hotel loyalty program

Customer reward programs are a powerful tool for any hotel.

To inspire guest loyalty, your rewards program should provide a small immediate benefit, like mobile room service ordering or access to members-only rates, and then increase the potential for rewards with every extra night and repeat stay. Hotel loyalty points that build up to bigger rewards are a great start, but don’t forget to include both personalization details and those hotel-classic strategies of showing special appreciation to your best-returning guests outside of the mechanical points-earning process.

At NewGen Advisory, we are dedicated to helping investors and hoteliers buy and sell profitable hospitality properties. Cultivating loyal guests who return year after year is an important part of any profitable hospitality business model. To learn more about how to implement an ideal hotel rewards program for your hospitality property, contact us today.

Share This Post

Powered by