Loyalty already has changed from a simple free-room equation to that of redeeming points at any number of related and non-related choices, but that trend is set to skyrocket. Plus, a couple of quotes from recent hotel conferences that ignited connections to soccer.
An interesting loyalty concept was suggested at last week’s Hotel Distribution Event in London.
Richard Clarke, senior analyst for European hotels and leisure at AB Bernstein, said the new direction of hotel loyalty programs would be to have then operate as a separate brand. Not 100% separate—as those programs would be where points earned are burned—but separate in appearance from the website of the parent hotel chain and separate in that points are increasingly not being used on overnights.
That landscape has been changing for a little while now. Just peruse two newly revamped loyalty programs, Marriott International’s Bonvoy and Accor’s All. But the exodus, I believe, will be even faster from this point on.
“This will be a bit of a battle,” Clarke said. “Customers are saying, ‘Make that loyalty program relevant to me.’”
The loyalty scenario of yore is one in which a roadside-hotel warrior-businessman—and it probably nearly always was a man when loyalty started—staying at Holiday Inns perhaps, accumulated sufficient points credit to take his family on vacation to Hawaii, Orlando or Las Vegas.
It was InterContinental Hotels Group who founded hotel loyalty in 1983.
These days female and male loyalty members would just as rather spend their points on seeing the popstar of the moment, eating a meal at a top restaurant, attending a musical or watching a professional sports team.
And why not have points be redeemable at a hotel of a rival chain?
It makes sense to keep points—and subsidiary spend—in-house, but I am sure customers would not look at their points as needing to be so restrictive in use.
Does it really matter where points are redeemed?
It comes down to the value a customer sees in any one redemption route. At every conference we hear that loyalty amongst the young does not exist, although I am sure it does if, again, the right level of value is perceived and redemption can be translated in what anyone wants—experiences or, yes, still, “free” overnights.
There must be plenty of cities with both business and leisure attractions where a company negotiates overnights for its employees with a specific hotel chain but where the relevant loyalty member knows the place in which he sees the most value to be had from points is not in that chain but in another one, or, indeed, in somewhere that has no hotel connections at all.
Aspirational use of points should not now mean—to continue to use the originator IHG as an example—earning points at a Staybridge Suites to spend them at a Six Senses only.
After all, however wonderful that example might well prove to be, that means all of our aspirations have been narrowly curated.
IHG has 17 brands, so the above example limits customers’ aspirations to 16 alternative choices.
Why, when there are billions of options for anyone to choose to spend their free time?
A search around the larger hotel chains’ loyalty programs already seems to give me the width of redemption choices outlined above, but then I should add I am not a shopper.
Quote of HDE, London
“We’re not interested in going into the hotel industry. Our (FlyZoo Future) hotel is a test laboratory on our campus.” —Terry von Bibra, general manager, Europe, Alibaba, when asked if the Chinese media giant was looking to become a hotel brand, due to its having opened this year a “hotel” in Hangzhou, China.
Cynicism intact, I immediately thought of that soccer/football-related chestnut when a chairman comes onto TV to say s/he has full confidence in the team manager and we all know said manager will be out within weeks.
Quote of the Hotel Investment in Europe Conference, also in London
“In Lisbon, which is hot right now, it is rather like football for 7-year-olds, while in Italy it is like playing at home but starting 0-2 down and winning on penalties.” —Desmond Taljaard, managing director, London & Regional Hotels, referring in the first instance to how children play soccer, with all 20 outfield players utterly abandoning their positions to run after the ball, in the second instance, I believe, to how the Italian national side always seems to at the eleventh hour getting through each round of knockout stages.
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