Building Guest Loyalty in Hospitality: Exchange Value for Direct Repeat Bookings

guest loyalty
Aileen Hoang
Aileen Hoang
July 10, 2014
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It is already known that it is less costly for hoteliers to retain a guest than it is to attract a new one. In fact, gaining new guests can cost approximately 5 to 8 times more than retaining your current guests. This is where the advantage of guest loyalty can bring about cost savings and repeat business for hotels. However, research also shows that approximately 68% of customers fail to return if they feel unappreciated throughout their experience. This presents a difficult challenge in the hospitality industry, where hoteliers must greatly strengthen their guest relationships and provide the best experience to guests on a consistent basis. At the present time in hospitality, only offering a “points-based” loyalty program leaves much to be desired and is not effective on its own standing. The travelers of today desire greater engagement, positive emotional connections, customized treatment, and the opportunity to feel entitled as valuable hotel guests. 

Building guest loyalty first involves identifying your business mix and determining your most profitable customer segment. After doing so, hoteliers can then create and implement propositions that taps into the needs and wants of their different guest segments. It is important to always remember that building guest loyalty requires more than just offering guests a typical loyalty program. The secret lies in providing rewards and services that trigger a key emotion – such as status, security, or belonging – hoteliers can develop an emotional connection with their guests. Determining what initiatives causes the right emotions is extremely powerful, because hoteliers can then establish personalized services and perks to their guests – something that OTAs cannot do. This in turn gives hotels the upper-hand against the massive OTA giants and an opportunity to win back not only direct bookings, but also repeat business.

There are many effective ways for hoteliers to build guest loyalty. First, it is essential to build guest loyalty across other channels, such as mobile, social media, website, advertising, etc. In order to provide the level of engagement and superior service that travelers desire, it is imperative to respond to negative reviews through TripAdvisor, post useful content regularly through multiple social media platforms, provide a seamless mobile experience, and plenty more that will differentiate your hotel from your competitors. Second, providing personalized services, such as exclusive packages or customized amenities, is another powerful method to foster guest loyalty. Third, it is also important and highly impressionable to ensure that guests realize that you greatly appreciate their business. A few ways to express this gratitude can be in the form of a handwritten and personalized thank you letter, keep in touch with guests through social media outreach and emails, ask for feedback from guests to learn what they like and dislike to make continuous improvements, and by taking an extra step to wow your guests enough to make it difficult for them to contemplate about picking another hotel over your own.

Building guest loyalty has become increasingly difficult over the years, and hoteliers must constantly adapt to the changes in guest preferences. Conclusively, guest loyalty drives direct bookings, and direct bookings create loyal guests that will return to your hotel time and time again.

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