Is value-for-money the key to driving guest loyalty at your hotel?

  Posted in Hotel Insights

Loyal hotel guest enjoys value for money

Driving guest loyalty is the ultimate conundrum for hoteliers. It seems as though retail loyalty has come through many phases. Once it was about delivering something to customer’s that was bigger and better, than it was about being cheaper than your competition. Now it may seem like consumer loyalty is drawing its last breath, such is the struggle for businesses to deliver consistent results with their loyalty schemes.

In a recent research study conducted by ICLP, a global loyalty consultancy, only 3% of consumers felt devoted to their preferred retail brands. A statistic like that paints a stark picture for the retail and travel industry.

Is guest loyalty impossible to retain in a world where customers are as fickle as brands are numerous?

Most hotels still identify loyalty programs as the tool to re-engage directly with their guests, but the failure lies in the approach many businesses take.

Loyalty is about desire, not coercion

École hôtelière de Lausanne tapped into the knowledge and opinions of many industry professionals to get their views on the issue of guest loyalty and the results were fascinating.

The general consensus is that the hotel industry is forcing our guests to change their behaviour, instead of making them want to.

In trying to combat some of the impact OTAs have on reduced hotel loyalty, hotels need to take on the persona of innkeepers and also use the obvious advantages hotel brands possess.

As one manager pointed out: “When a customer eats breakfast at my Marriott, every Marriott hotel in the world has the opportunity to know what that person likes to eat for breakfast. Expedia does not.”

What some hotels have forgotten is that customers are loyal to service and value, not simply to price. A discount is not enough to keep a guest coming back. Hotels can only win the hearts of travellers by knowing them better and showing genuine care for them. The guest will be more likely to return the favour.

What hotels have forgotten is that customers are loyal to value, not just price.

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Loyalty is about rising above expectations

The fickle nature of loyalty in today’s world means customers will never forgive brands for failing them. The second their favourite product changes or falls short of expectations, they take their business elsewhere. This is why hotels have to surprise their guests with the experience they offer and the degree of personalisation they display.

Taking luxury travellers as an example, one expert offered the following:

If a luxury traveller spends £1,000 a night for a room, do you really think he would be happy to receive a £10 reduction on his next stay or an upgrade? It doesn’t create loyalty. Loyalty is created when you can give this customer an experience. You know who the customer is before he comes into your room. What does he like, what are his preferences, how can you surprise the guest?”

The expert went on to add that luxury can exist in any type of hotel and that loyalty is about the impression you leave on a guest.

“I stayed at a Holiday Inn at the airport and expected very little. I came in, had a USB plug right next to my bed for my iPhone. Nice shower. Great bed, clean, simple. I was by myself and slept there for four hours. It ticked every box I wanted. Historically, even today, the lower down you go in the food chain, everything’s free. At your Holiday Inn Express, the phones are free, the internet is free. You stay at the Four Seasons, the internet is 45 dollars a day. A faxed page is £10. And you don’t think about it because you’re staying at a luxury hotel, whereas at all the budget ones, everything is included.”

Creativity leads to loyalty

Without the constraints of big brands or chains, independent hoteliers have the best opportunity to start winning back loyalty.

With value-for-money as the go-to mantra, there are a variety of ways to please guests.

Think about how you can pleasantly surprise your customers and give them more than they think they’re paying for.

Think about offering:

  • Complimentary services
    Breakfast, wifi, late check-out are things your guests would be thrilled to get for free
  • Inclusions
    Even an extra ‘care-package’ of food, beverages, or toiletries could be enough to put a smile on your guest’s face
  • Familiarity
    Greeting your guests by name, anticipating their needs, and remembering their preferences goes a long way
  • Socialising
    With many guests travelling alone, they would much appreciate an excuse to connect with other travellers. Host happy hours or other social activities to bring people together and create a welcoming atmosphere

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