How Leveraged Is Your Loyalty Program?

Loyalty programs in the hospitality industry are hardly new or novel.  Road warriors are likely to be enrolled in programs for every major hotel company, airline, multiple rental car companies, restaurants, spas and salons, grocery stores, clothing stores, shoe stores, and more.

Yet ask the road warrior about the value of the loyalty program.  The answer you’re likely to get is a succinct, single word: points.

A recent NY Times article about Sam’s Club delves into a fascinating concept in the world of sales and marketing: predictive analytics.  Those of you who subscribe to Netflix already know what this is.  Netflix analyzes the movies you have rented in the past and suggests movies to rent in the future—often, with surprising insightfulness.

Similarly, Sam’s Club analyzes each individual card-holder’s buying habits and tailors coupons and special offers toward the individual.  To the next level, companies can even send these specific ads to individual users on their smart phones, as detailed in a Wall Street Journal article this week.

What is most intriguing about the concept of predictive analytics is what the hospitality industry can do with it.  After all, think of what a hotel, for example, knows about its guests:  the people who spend a little bit more than they should on room service breakfast because they are in a hurry; the people who utilize dry cleaning services because they simply do not have the time or energy to do laundry; the people who buy bottled water at airports because they know you cannot carry water through security, and they lack the luggage space for a re-usable water bottle.

Let’s take it one step further.  What if a hotel were to partner with Netflix, for example?  Would the Plaza Hotel in NYC be interested in a list of consumers who rented “Eloise”?  One could only hope so, especially if they could sort it by zip code.

Clearly, sales and marketing gurus have already beaten a path that hordes are traveling on, in order to figure out how to use predictive analysis to get more customers.  But what about the guest experience?  Hotels are one of the only businesses where guests consume the product onsite, and often, over a long period of time.  It makes sense that the guest staying three nights, who orders room service breakfast on the first morning, would probably appreciate a customized ‘deal’ for the remainder of the stay. The data is out there, and the PMS can easily harvest it.  Someone would just have to notice…and care.

Likewise, hotel sales teams can also work on predictive behavior analysis for group sales and catered events, not only to capture more business but also to improve the guest experience of meeting and event attendees.  Consulting reader boards, analyzing group history, and observing which type of cookie disappeared the fastest off the PM break setup are only a few ways that hotel sales teams can demonstrate that they, too, notice, and they, too, care.

© 2018 Coyle Hospitality Group 2016. Reproduction of any material without written authorization is strictly prohibited.

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