The importance of loyalty during a downturn cannot be emphasized enough. Guests that love your property are going to be far more engaged than transient one-timers. They will also be better guests than deal-seekers amidst a global downturn. And, once the recovery gains steam, these guests are usually the first to return.
As I look beyond the pandemic, I see a world of promise and potential. Guests will be eager to visit their favorite destinations (and hotels) -- and they will be willing to try new brands that appeal to their newfound freedom. As more guests begin to travel, they will have a heightened expectation about the experience. After all, they will be very excited to finally be out in the world again!
In the post-COVID future, it is paramount that hoteliers leverage their technology and CRM stack to personalize every touchpoint of the guest experience. It is all about those surprise and delight moments that make an impression and get guests talking. Here are a few thoughts on the strategies that will drive loyalty once this pandemic fades.
1. Stellar communicators win
Brands that communicate well earn the most loyalty. Now is the perfect time to revisit each guest touchpoint, including any automated communications that go out on a scheduled basis. Evaluate each communication in terms of context, relevance, and timeliness: does it convey contextual information based on the guest's personal profile and current mindset (i.e. transactional, inspirational) and is it delivered at the right moment in the guest's preferred channel?
To flex those stellar muscles, use your CRM data to provide guest-specific information prior to arrival. Tailor your communications based on the guest's origin to provide the latest information about what they can expect upon arrival, as well as any relevant travel restrictions. You will also want to prominently feature your latest cleanliness policies and all other essential information.
Post-pandemic, none of this will change. Guests will expect clearly stated information and full transparency from hotels. Delivering stellar communications is a core competency!
2. Personalization deepens
A small subset of past guests and corporate accounts usually account for a large percentage of a hotel's revenue. It is the 80/20 principle: 80% of your revenue likely comes from 20% of your guests. So, find that 20% and deepen your personalization to show how well you know your guests - and why they should remain loyal.
That tactic requires you to analyze your CRM's rich guest profiles to identify opportunities to wow guests with great offers personally crafted for them. For instance, guests with families may be especially amenable to targeted offers around "workations" that blend remote work and learning space for their children. And your most frequent guests may respond well to personalized offers around loyalty rates, reduced point redemptions or bonus points for new bookings.
3. AI enables enhanced segmentation
As hotel marketers, it is complicated to communicate with such a diverse group of people. To improve the odds of success, audiences must be segmented according to some combination of purchase behavior (recency, frequency, monetary), geography, demographics, or psychographics. Marketing communications can then be optimized for each segment's unique preferences and expectations.
This optimization has been forever changed by artificial intelligence, which can dynamically sort and segment guests, based on both behavior and intent, and then pull them into an optimal communications sequence. AI-enhanced segmentation can be coupled with dynamic offers, which matches ancillaries, upsells, bundles to each segment. And we are not just talking about room rates and packages!
Behavioral data can provide windows into other ways to reward loyal guests. By watching how segments interact with offers, and adjusting in real-time, you can entice specific segments with bespoke offers. Then, using what you learn about which offers appealed to which segments and under what context, and using those conversions to further refine targeting.
When you dial into your segments, you can identify ways to build loyalty off-property. These pathways include building partnerships with like-minded brands to either give guests new ways to earn points or to create bespoke packages that offer more to your very best guests. For example, you could work with a fashion brand on an exclusive line of clothing for the most loyal guests or create an exclusive experience with a local chef. With a little creativity, elbow grease and AI-driven segmentation, it is something that even the scrappiest independents can achieve!
4. "Free agents" shift loyalties
In a bid to preserve stickiness for their loyalty programs, many hotel brands have extended elite status into 2021 and delayed points expiration. Even so, many travelers became disengaged during the pandemic. Untethered from past loyalties, these travelers are eager to try new brands once travel resumes in earnest, which means that loyalty is up for grabs!
Hotels have an opportunity to capture the attention of these "less loyal" guests. Plan to offer incentives for both new and existing members. These could be sign-up bonuses for new members or sweeteners (like Hilton's bonus points for work-from-hotel bookings) that engage existing members. In both cases, the key is to understand the psychology driving engagement and to focus loyalty promotions on attracting new members without losing your best guests.
Return to the fundamentals of loyalty
If we do right by our best guests, they will do right by us -- and profits will follow. By building relationships now, you will benefit one hundredfold once travel becomes top-of-mind again. Even once demand returns, travel patterns are going to be different in 2021 than they were in 2019. The billion-dollar question is how they will change -- and what this means for hospitality.
When vaccines are available early next year, we will likely see a record boom in travel as everyone rushes to get the heck out of the house. But will this leisure travel be sustained after the initial rush? And what about business travelers, the bread-and-butter of most loyalty programs? Will they return with the same frequency and velocity as before?
We may not know the answers. But one thing is certain: the fundamentals of loyalty remain the same. It is all about rewarding our best guests. When we put the guest at the heart of what we do and focus on ways to truly make elite status more rewarding, we can earn their business now and far into the future.
Cendyn is a catalyst for digital transformation in the hospitality industry. We help hotels around the globe drive profitability and guest loyalty through an integrated technology platform that aligns revenue, eCommerce, distribution, marketing, and sales teams with centralized data, applications, and analytics, so they can capture more demand and accelerate growth. To find out more, visit www.cendyn.com.