No direct sales strategy that is put into practice by a hotel makes sense if the correct actions are not taken to get the customer to return.
NB: This is an article from Roiback
Loyalty programs together with customer service, user reviews, and an easy to use website, are all factors that the majority of travelers consider when making their next reservation.
Loyalty programs have also become essential to any direct channel sales strategy because the full technological transformation of this platform allows you to compete with large OTAs to acquire and retain new customers.
01 REVENUE GROWTH
Loyal customers spend on average 22.4% more than sporadic customers and have 28% longer stays. Their loyalty translates to an increase of up to 25% of the hotel’s profits.
02 CUSTOMER RETENTION
A customer who trusts a brand will most likely repeat. With a repetition rate of 5%, it is possible to triple the annual growth of a company and increase profits up to 25% per year.
03 INCREASE CUSTOMER SPEND
When a customer trusts a brand they are more likely to spend more. It is proven that a loyal customer spends more than a sporadic one, and in the 5th year of repeat custom, they will spend between 1.8 and 3.5 times more than the first. In addition, a loyal customer will buy 10 times more often than their first life cycle as a new customer.
04 COMPETE WITH OTAs & BIG CHAINS
With a good loyalty strategy, you can compete with the leading OTAs’ loyalty programs. Currently, there is a fierce battle to “take over the clients” between the big hotel chains and the OTAs. Therefore, for all the other smaller chains and independent hotels creating a good loyalty program is a key strategic factor.
05 COST SAVINGS
A loyalty program dramatically increases the profitability of a client despite the initial investment of creating and implementing a new program. This is because the cost of client retention is much lower than client acquisition, due to the fact that you have a much better understanding of a loyal customer’s profile and wishes compared to a new customer, therefore occurring less cost to assist them properly.
06 MARKETING STRATEGY
A loyal and satisfied customer is the best source of communication for your company. The opinions of users enable you to improve your brand reputation and are one of the most influential factors when making a purchase decision.
07 PERSONALISED EXPERIENCE
The majority of consumers in today’s market prefer to enjoy a personalised user experience. This is possible because a good loyalty program will provide a customer profile analysis through the capture of data and information of the user, which in turn strengthens the link between your brand and client; and allows you to create personalised marketing campaigns.
08 CONSUMERS FEEL MORE VALUED
A loyalty program that satisfies and impresses the consumers will also make them feel more valued and connected to the brand. The consumer will also have more patience with any setbacks that might arise.
09 IMPROVED COMMUNICATION
The loyalty program is a direct means of communication with your client. It allows you to send personalised direct messages instead of generalised emails that will not be taken care of. In addition, you can promote reservations, events or offers for each type of customer.
10 CUSTOMER ACQUISITION
If a new customer can see that they would have access to better prices if they were part of your loyalty program, then they would be more likely to register and book. Then, once they’ve sign-up as a new customer, they will be more likely to return due to the features of your loyalty program.