Customer loyalty is sought after across all industries. But the recent mergers, acquisitions, and importance of being “big” in the hospitality space, has made brand loyalty increasingly important for hotels. With the new generation of millennial travelers, loyalty programs can be key to building customer engagement for hotels. A 2013 survey revealed that 87% of consumers report wanting some type of loyalty program, and that number has only shown to grow with the new era of travelers (Talech). The total number of members in coalition loyalty programs worldwide is likely to have risen above 2 billion for the first time in 2015, proving this is not merely a fad (Finaccord). The success behind these programs relies on the fact that most consumers have one thing in common, they love saving money. Researchers concluded that 47% of consumers join rewards programs because they like saving money any way they can and 23% like earning rewards on everyday purchases (Exentus).
Despite these findings, only 41% of hotel chains reward customers for at least one form of engagement (Cap Gemini). With loyalty programs on the rise, hotels should increase efforts in rewarding loyal guests and sparking interest with newcomers. More attention to personalization will be the key to a program’s success, as 82% of consumers said loyalty programs would be better if they allowed them choose the categories of reward they wanted (Collinson Latitude). 41% of millennials say they joined a hotel loyalty program because the rewards were easy to earn, proving simplicity is another important factor for customers.
Millennial travelers are a crucial demographic to the hospitality industry with their increased travel spending. And lucky for hoteliers, millennial travelers have shown a significant interest in these loyalty programs, as 63% of millennials said they had joined a program within the past year, versus 55% of the general population (Colloquy). The likelihood of a more loyal generation of travelers is increasing. In fact, millennials indicate that they would pay $41 more per night and travel up to 15 minutes out of their way to stay with their preferred hotel brand (Deloitte). Personalization is again important for these travelers; 79% of millennials said they would pay for rewards that correspond to their specific needs (Loyalty One).
So, what is the next step for hotels? In light of our research, we have come up with 3 ways to faster engage your guests and help increase loyalty programs for hotels.
1. Specific Targeting
A recurring, loyal visitor does not expect to be treated the same as a new customer. Site content should reflect this notion and vary base on the visitors needs, as many of these customers are expecting a more personalized experience. Categorizing customers is a simple way to better connect with site visitors. For instance, a person who has visited the site 4-5 times is more likely to make a purchase and would be an ideal candidate for a loyalty program. Targeting customers based on their number of visits to the site allows you to more quickly engage a new customer or offer a returning visitor a better reward. To increase awareness of a loyalty program with past guests, campaigns can be focused on visitors who have purchased previously but have yet to sign up.
2. Email Capture
Email capture is an easy way to connect with a customer after just one visit to the site . Additionally, email content can be used to increase brand awareness, build online relationships with new customers, and keep guests connected after their stay. By engaging visitors who are hitting the site with a targeted email capture form, marketers can send new visitors specific, relevant emails that encourage a loyalty program sign up.
3. Initial Offers
Everybody likes a good deal, but a “good deal” differs from person to person.. Therefore, engaging visitors with initial, personalized campaigns when they hit the site is a sure way to gain their attention and build a loyal consumer base. When hotel marketers understand and target each visitor’s preferences when they hit the site, they can ensure that each person is seeing the most relevant and enticing loyalty program feature for their needs. For example if someone has “landed on” the Rates page multiple times, but has yet to make a purchase, hotel marketers should display the room savings that their loyalty programs have to offer. This will not only result in a direct booking, but also a returning customer in which the hotel can build a relationship with over time. Customizing content and offers based on visitor conditions takes the relationship with the customer one step further.