Summary: You work hard as a hospitality program manager to curate great guest experiences. And while a big part of that effort takes place within the context of your face-to-face interactions with them, that’s only part of the customer’s “journey” with your brand. Hospitality loyalty programs can help you close the loop on providing a review-worthy experience with your hospitality brand, from start to finish.

What do Hospitality Loyalty Programs Really Mean for You?

Part of any phenomenal guest experience is the magic that makes it all work. As hospitality program managers, anticipating our customers’ needs before they do, is essential. We go the extra mile (if not several more) to ensure guests want for nothing. We create seamless interactions that leave the impression that each of what could be hundreds or even thousands of customers is the only one that matters to us at that exact moment.

Yet, we often have difficulty translating that commitment to other aspects of our guests’ journeys. We don’t leverage these experiences to drive new business. We sell significant aspects of the customer path-to-purchase to the highest bidder. We don’t understand who our most valuable guests are or what we can do to increase their ranks.

Many of us are looking to technology to help better understand and manage the guest experience in a way that mimics our general ethos, providing a seamless value-based experience over every platform, channel, and device where they engage with us.  More than that, we’re looking to leverage each experience to help tell a story about what we value and use it to drive repeat business.

A loyalty program may not be the first solution that pops into your head for meeting these goals, but there’s a lot to dig into here. More advanced loyalty and rewards software offers much value through tools that can help you improve your overall guest experience, drive word of mouth, and significantly impact your bottom line.

Spreading the Word

Word-of-mouth is likely one of the most powerful components in your hospitality marketing toolkit. Hospitality.com stated that referrals drove more than 40% of hotel reservations worldwide in 2017. Our choice then isn’t whether or not to focus on word-of-mouth but how well we can leverage loyalty programs to help drive it.

Build Reviews

Love ‘em or hate ‘em, review aggregators like Trip Advisor, Yelp, and Google Reviews can greatly impact your business. In addition to driving revenue, they’re valuable components of your SEO, PR, and PPC strategy. Using loyalty to drive reviews of your program with marketing automation

• Solicit – “The answer to every question you don’t ask is “no”’. Garner reviews from your loyalty program members by sending an automated follow-up email surveying various aspects of their experience. Offer additional loyalty program points for the customers who do.
• Record – A key benefit of omnichannel loyalty software is maintaining a unified customer record across all touchpoints. Where possible, attach customer reviews to each member’s unique profile. This will give you insight into how their experience has evolved and help your employees closely monitor future engagements.
• Engage – Your response to a negative review often says as much about your business as the review itself. Leverage your rewards program to help offset negative experiences.

Get Social Shares

Social media is a powerful tool for earning word-of-mouth business. The average Facebook user now has about 338 friends. How much would you pay to connect with each of these people?

Your program should offer rewards for sharing your experience on social media with a check-in or other recommendation. Some omnichannel loyalty programs, like bLoyal, have tools to identify a guest by their social media handle. Track these mentions with almost any social media monitoring tool and apply discounts directly to the guest’s account based on your branded hash or name tags.

Leverage Brand Loyalists

We’ve talked quite a bit about how referral or ambassador programs can drive revenue over the past few years. One of the most frequent questions we get, with regards to hospitality-based businesses (especially if they’re a larger spend, like a cruise or tourist destination) goes, as follows:

“Customers don’t visit me very often, but they spend a lot. How can I use loyalty to expand beyond my customer base when I may only transact with a specific guest once or twice per year?”

Ambassador programs are a great place to start. Past guests should be able to earn points and other rewards, based on the new business they send your way. If a guest who only does business with you once a year recommends your cruise line to ten other people who subsequently purchase cruises, it would be well worth your time to offer them a steep reward for doing so.

The end user isn’t always your target, though. For instance, in a restaurant located near a hotel, it may make more sense to offer rewards directly to concierges. If the concierge has directed ten families to your restaurant throughout the night, paying for their dinner is equally valuable.

Segmentation

One of the important lessons retail businesses have learned in the last ten years is that you can learn much about a customer by what they purchase. Using purchase-level segmentation built into most integrated loyalty systems helps you build more relevant content. What does this have to do with spreading the word about your loyalty program? More relevant messaging means that guests are more likely to pay attention to and share your content. The more attention they pay to you, the more likely you will be top-of-mind when friends ask for recommendations.

Rethink Rewards

The average hospitality rewards setup is pretty basic overall and tends to run a bit like frequent buyer programs: You stay, dine, or book a certain number of times, earning “X” in the process. Many programs never move beyond that model, however. Omnichannel rewards have come a long way, and most hospitality-based customer retention strategies leave quite a bit of money on the table regarding opportunities to use their loyalty program to drive the bottom line.

Here are some suggestions for using your loyalty program to get a leg up:

Winning the Affiliate Game

As of 2023, approximately 60% of all hotel bookings are made online, with this figure steadily increasing. webrezpro.com

Notably, in 2021, Online Travel Agencies (OTAs) accounted for 52% of online leisure hotel bookings, surpassing direct bookings through hotel websites. phocuswright.com

While OTAs offer significant discounts and help fill vacancies, they can impact brand loyalty and profit margins. Guests may develop loyalty to the OTA rather than the hotel brand, and the commissions paid to OTAs can reduce overall profitability.

To mitigate these effects, hotels can implement direct booking incentives, enhance loyalty programs, and improve their online presence to encourage guests to book directly.

This isn’t exclusive to hotels and travel agencies, though. Many restaurants and smaller independent businesses face a similar dilemma. Sites like Yelp, Bite Squad, and Open Table get thousands of reservations every hour, and they have become a major onramp for new and returning guests. As a hospitality program manager, you already know that.

Whatever the case, you don’t want to sacrifice your value proposition, but you need to leverage and compete with these sites on a value-added basis to get the best of both worlds. The most pertinent question is, “What does a customer have to gain by reserving or purchasing directly through you?”

Point Multipliers

Offering a simple point multiplier is a great place to start when addressing ways to get a leg up on affiliate programs. Without the profit cut by third-party partners, you have more margin to work with, and giving clients who book through you added points for doing so can make a big difference in your bottom line. Split the difference with a point multiplier that will keep members returning to your brand vs. outside discount sites.

VIP program Access

Your VIP programs can be especially important for hospitality-based programs, and it’s something that affiliates don’t have much access to. Avoid minimizing your VIP program to a basic “Buy 10, Get 1 Free” deal. Many affiliates offer similar programs and merchants should offer an incentive that third-party companies can’t possibly compete with. For example:

1. No cost cancellations, instant check-in, reserved seating.
2. If your business offers premium upgrades, use them as awards for clients who faithfully engage your program at the local level.
3. Use other hospitality industry partnerships to increase your loyalty program value proposition.

Drive Add-Ons

Add-ons are an important part of your hospitality business—whether it’s a day at the spa or a high-end bottle of wine. Use your loyalty program to introduce premium products by rewarding members with additional % off discounts on sister products.

For example, if your hotel has a spa, leverage the points earned during the booking process, towards a reward that offers a free seaweed wrap. If completed, you’ve used your rewards to introduce customers to a new product or service and provided additional value to the guests, which will keep them returning.

Go Omnichannel

One of the most important ways hospitality managers need to rethink how they use awards programs to drive business is how they are accessed. Many of the affiliate programs we previously spoke about are winning over customers simply because they’re accessible on all the devices where customers now spend time.

Building an omnichannel loyalty program isn’t as difficult or expensive as it once was. Many cloud-based programs integrate (either through custom development or pre-built integration) directly with the most popular hospitality, food-service, and entertainment-based checkout solutions.

Grow Your “VIP” offerings

Recognizing your most frequent (and valuable) guests is important. They spend more time frequently visiting and talking to their friends about your business. Integrated omnichannel loyalty provides us with many new tools for expanding your programs and controlling the guest experience, from beginning to end.

Tiered VIP

In a recent SlideShare presentation, the bLoyal team discussed tiered offerings and how they can drive more loyal customers. Tiered programs reward guests with increasingly valuable benefits based on their frequency of completing a desired action. The more visits, spend, or referrals the guest has, the greater the value of their program.

The guest must continually meet a defined goal to stay in this tier. This drives personal investment for those who want to get the best benefits.

Subscription Models

You may not consider a service like Postmates, a hospitality-based business providing a concierge-style experience for your home. Several months ago, they launched a subscription model, charging top users a monthly subscription fee for unlimited uses.

Hospitality loyalty programs can leverage these unique tools to drive subscription revenues with special offers for their regular guests, including business travelers, neighborhood residents, and more.

Other Hospitality Loyalty Program Ideas

Looking for other great loyalty program ideas for your establishment or hospitality business?

• Restaurants can create locals-only discount programs to drive their base diners.
• Taxi services can create awards for booking airport runs with them.
• Multi-unit hotels, motels, and lodges can build awards around local attractions.
• Wineries and Breweries can create club-based wine or beer “of the month” clubs.
• Theme parks can award points based on awards and social mentions.
• Cruise lines can provide exclusive perks for loyalty program members.

If you want to build an incredible hospitality loyalty program that generates repeat business with increased word of mouth, bLoyal can offer you a place to start. Learn more by requesting a free demo, or contact us at [email protected].