In my view, the best demonstration of brand loyalty in hospitality is the share of repeat business.

Travel consumers are buried under an avalanche of options and offers, and if they repeatedly choose your brand over the competing alternatives, obviously your brand has an appeal above and beyond the competition.

This appeal is a result of the perceived value proposition of your brand and the travel consumer’s emotional attachment to your brand. Loyalty program=repeat business. Repeat business=cheap direct business.

On average, over 58% of roomnights at major hotel brands come from members of their loyalty programs. At Marriott and Hilton this percentage is 62%.

What kind of loyalty programs work?

Points work only for the major hotel chains with either global or at least national footprint. Points are financial tools like currency and cash in the bank. Guests have been accumulating points and airline miles for decades and are used to those. You can use points to buy hotel rooms for family members, you can gift and donate points, etc. Corporate travelers accumulate points from their business trips, which they use to take their family on a dream vacation.

No wonder, Marriott Bonvoy already has over 260 million members, while Hilton Honors - over 235 million.

For independent hotels, midsize and smaller hotel groups far better suited is a loyalty program in the form of a reward program or guest appreciation program that is easier to implement and manage, and easier to understand and appreciated by travelers.

A program like this could be based on perks like early check-in, amenities like free breakfast or free upgrades. Or it could be based on free roomnights when a certain threshold of stayed nights is achieved.

Even a 10-room hotel can have a simple guest appreciation program. No points, no complicated technology. Stay 10 roomnights within a calendar year, and get the 11th roomnights free. Hotels..com created one of the largest loyalty programs in travel using this same simple formula and had 70 million loyalty members, before it was merged with Expedia’s OneKey program.

At my former company NextGuest, now merged with Cendyn, we implemended similar Guest Appreciation Programs for our hotel clients. Combined with our CRM tech, this program typically tripled and even quadrupled number of repeat guests and provided the hotel with a powerful tool to learn everything it needed to know about its guests.

After all, how can you provide above-and-beyond customer service to guests if you don’t know anything about them, past stay history, their preferences, likes and dislikes?

As per SKIFT research, 22% of U.S. travelers find hotel loyalty programs most rewarding while 34% of travelers like their credit card loyalty programs. In other words, if your hotel has a loyalty/reward program, 56% of travelers will be happy to stay at your property since most book and pay with their credit cards.

Max Starkov
Hospitality & Online Travel Tech Consultant & Strategist

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