The other night I checked into a hotel that I’ve stayed in at least a hundred times. At the front desk I handed over my driver’s license and credit card and — without being offered any upgrade options — I was assigned an average room and headed toward the elevators.
This is a hotel that promises five-star service. They boast that previous reservations are saved, allowing them to create a more convenient experience for guests and that the guest services team will always deliver one-on-one assistance.Can Points Programs and #Hotel Personalization Co-exist? #revenuestrategy Click To Tweet
So when I entered my room and found two beds as opposed to the king that I always request, I was slightly disappointed. I called down to the front desk. After promising to fix the mistakes and move me to a king room, the employee could not locate my guest profile in the system. All of a sudden a handful of people were in a panic and the whole process seemed rather disjointed.
This is a real problem for hotels today and affects more operators than we might think. While we assume CRM systems are storing the right information in the right places, that’s rarely the case. Unfortunately, I’ve found that most hotel companies will not readily admit that they have similar issues.
Had the systems at this hotel been working correctly, the front-desk clerk who checked me in would’ve seen every one of my past stays. She should know whether I booked direct or through an OTA, what I charged to the folio, where I went to eat and what I ate. She also would’ve seen that the last time I was here I paid nearly $100 for an upgrade.
Hotel marketers talk a big game about personalization and having a complete view of their guests, but in most cases, I’ve found that not to be the case. Marketers have grand visions about connecting with their guests over multiple touch points, but often those visions go unfulfilled because the marketing team is constrained by legacy technologies and outdated processes.
Personalization and Points Can Co-exist
As evidenced by my recent experience, we’re still far away from personalization working the way it should. But I’m glad to see the industry putting in effort and moving forward, even if it’s by way of baby steps.
Many hotel companies are now offering a discount to loyalty members who book on brand.com, in part to increase direct bookings and also to deliver guests “instant gratification.” We’re a big proponent of this and think it’s a great first step that will eventually lead to personalized 1:1 rates rather than flat, blanket discounts.
Much of the resistance I’ve heard with regards to personalized pricing is that it forces brands to ditch their points programs. The thought is that if guests are being rewarded instantly with discounts they shouldn’t also be earning points toward a free future stay.
I don’t necessarily agree. Instead of creating an “either/or” situation, I think hotels can find a “yes, and” situation that works for them. Perhaps your leisure loyalty members receive discounted rates based on their total value but your business travelers can still accrue points. Or perhaps you give guests the option of an instant discount or points toward a future free room. The strategies do not have to be mutually exclusive.
Red Lion has ditched their points program in favor of personalized loyalty pricing, and so far the feedback has been tremendous. They’ve grown loyalty membership by leaps and bounds. But it might not be the right fit for every brand, so we must find a way to reward guests for loyalty on their own terms. There is no one-size-fits-all approach.
We’re advocating for loyalty pricing because it seems to be where the industry is headed and it removes a layer of congestion from true guest personalization. Because of all the accrued points that go unused each year, we are betting on personalized loyalty pricing winning in the end. But we also understand there are certain people who live and die by their points. So we’re working side-by-side with those programs while suggesting hotels at least put a transition plan in place.
Regardless of your strategy, the bottom line is guest communication. It’s imperative hoteliers communicate to their guests what they’re getting in return for their loyalty, thus increasing that personal connection.
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Latest posts by Marco Benvenuti, Co-Founder, Chief Analytics & Product Officer (see all)
Tags: 1:1 marketing, big data, boost bookings, Duetto, hospitalitynet, hotel distribution, hotel marketing, hotel pricing, Hotel Revenue Management, hotel revenue strategy, hotel sales and marketing, hotel technology, hotel yielding, legacy technology, loyalty points, loyalty points programs, membership programs, Personalization, personalized loyalty pricing, personalized marketing, points programs, RMS, Tnooz