Ms. Horwell

Guest Service / Customer Experience Mgmt

Integrating Mobile with an Existing Loyalty Program

By Vanessa Horwell, Founder & Chief Visibility Officer, ThinkInk & TravelInk'd

Hotels need to take advantage of the strategic opportunities that the mobile channel offers in regards to their existing loyalty program. Not in 2012 or the next quarter, but right now. Customer loyalty is shrinking: in this recessionary period, the industry’s promotional mix is no longer skewed primarily towards the product, but rather it has shifted (harshly, I might add) to favor price, in the form of heavy discounting, which erodes loyalty across all brands.

Further adding to the problem is the attitudinal malaise by customers regarding loyalty programs. Across industries, including hotels, there are 1.8 billion loyalty program memberships, a number that continues to rise. This fact, accompanied with a recent Chief Marketing Officer Survey that shows a whopping thirty-two percent of participants feel that the programs offer “little to no value,” leads to the conclusion that there are a lot of disengaged loyalty program participants in this world.

There’s no doubt that integrating mobile into a hotel’s loyalty program is a natural progression—in fact, hotels should be integrating mobile throughout operations and marketing, creating what I have often referred to as the “Mobile Front Desk. (http://hotelexecutive.com/business_review/2592/the-mobile-front-desk-the-effect-on-the-hotel-brand/)” Mobile is fast becoming a preferred channel for hotel consumers: the 2010 Frequent Traveller Survey by Loylogic shows that 20% of travellers prefer to check, earn, and redeem loyalty points via their mobile devices (mobile was second to “online,” at 58%).

Mobile: A Channel of Immediacy (and Choice)

With mobile becoming a channel of choice, hotels are constantly striving to balance “rapid” customer choice with operational efficiency. I use the term “rapid” because the mobile channel exponentially speeds up customer decisions and hotels must react quicker to an ever-compressing booking window. Think about it this way: in reality, with mobile, the customer can stand (or park) outside the hotel and instantly perform a comprehensive search (including customer and expert reviews of the hotel’s service, price, quality, etc.) to see if the it meets his or her lodging preferences. With this power at their fingertips, mobile customers are less constrained by traditional trip planning standards. Because they are able to tap valuable information at a moment’s notice, regardless of their location, mobile customers are more comfortable leaving entire segments of their travel relatively unplanned. In response, hotels seeking to expand their loyalty program into the mobile realm must cater to this customer base by structuring mobile rewards and points around rapid mobile booking.

With this in mind, it’s important to know that the mobile channel in hotel reward programs has arrived; however, simply integrating mobile with an existing loyalty program is not enough—it’s a two-way street—the existing program needs to also be integrated with mobile.

Expanding on this concept, I venture to offer that the integration of mobile with existing hotel loyalty programs will add a “spark,” but, in order to maintain the spark, hotels need to focus on the implementation of the reward mechanism itself. To just add mobile capabilities for checking points, earning points, and redeeming points (for a reward in the future) to an existing loyalty campaign is to not take full advantage of all that mobile can offer such a program. The main advantage of the mobile channel is that it allows instant access to rewards at anytime, from anywhere – an advantage that digital rewards provider The First Club has started implementing through several well known hotel loyalty programs. This advantage enables mobile customers to instantly access physical rewards—complete redemption fulfillment now—not at some point in the future. Through downloadable content such as books, music, movies, games and other digital content, mobile can provide guests with instant reward gratification.

Gratifying Rewards Through The Mobile Channel

Such instant gratification will provide “re-engagement” between the guest and the loyalty program. This ability of mobile to provide instant gratification solves one of the oldest and toughest issues associated with loyalty programs: the delay between earned-point thresholds and redemptions. Think of it this way: to entice immediate redemption, there should be no delay for a traveller who wants to read the latest top-selling novel or listen to a recently released album on their trip. Which brings me to another point: instantly-attainable mobile rewards further engage loyal customers in the program by giving them rewards that complement the “moment,” i.e., rewards that are relevant to the guest’s travels.

As all savvy marketers know, consumer behavior is spurred by purchases that are associated with, or that complement the “moment.” The same urges that prompt fishermen or hunters buy new gear while on a fishing or hunting excursion are the same urges that travellers have when they buy products and services that are relevant to their trip. Hotels can capitalize on such urges by offering relevant products, or those products that guests are looking to purchase anyways, during their travel. A program that successfully integrates mobile, relevant rewards will keep loyal customers “burning points,” thus, keep them engaged and interested in accumulating more reward points.

Of course, a loyalty program should not operate on points alone, and this holds true when it comes to integrating traditional programs with mobile programs. Once again, look at the characteristics of mobile hotel consumers: they are flexible and they are comfortable in relying on their mobile devices to link them to the information that makes this flexibility possible. In addition, mobile customers use their mobile devices to keep track of things—from important contacts, to vital calendar entries—mobile customers want to input their information into the device, and then forget that information until they need to either access it, or be reminded of it.

From Points to Recognition to Personalization

Now let’s consider one of the main benefits that hospitality customers seek to get from traditional loyalty programs: recognition. Hotels have reconfirmed this fact time and again: recently, at a Cornell Hospitality Research Summit, Sean Taggart, vice president of marketing, Fairmont Raffles Hotels International, revealed that ninety-one percent of Fairmont’s guests prefer recognition. This contrasts dramatically with the fact that eighty-nine percent of Fairmont’s guests care nothing for points systems. Fairmont follows up on this quantitative data by providing its guests with a loyalty program that emphasizes personalization, recognition, and convenience. The mobile channel can also be integrated into this type of reward program by tweaking the reward mechanism in order to fit the needs and wants of mobile consumers.

Whether the recognition comes from personalized greetings, special deals or compensation from different hotel services (restaurants, spas, amenities, etc.) is not as important as making sure that such services are offered within a timeframe that meets the needs of the mobile consumer. What’s the point of enticing mobile loyalty if it is not consistent with the flexible timeframe that mobile customers are demanding? My suggestion would be for hotels to start accommodating through the mobile channel. Imagine this: a loyalty customer books via his mobile device, and the hotel’s system instantly messages him that they can fit him in for a massage this evening, or that the he has an automatic reservation at the restaurant if he wants to accept it.

This brings us back to the beginning when we talked about fusing rapid consumer choices with operational efficiency in a loyalty program. The mechanics for such a mobile extension of a traditional loyalty program will place new stresses on all hotel staff, across all departments, but it should be done to ensure a true mobile loyalty program integration.

Finally, one of the characteristics of mobile customers I mentioned earlier is that they allow their mobile devices to provide them with all the information they need in one small package. “Personalization” from traditional rewards programs can be easily “translated” into the mobile channel. Hotels can generate personalized greetings to be sent on special dates, and create alert reminders that conveniently notify guest of important times (reservations, check-in, check-out) during their stay. Getting even more specific, the property can create a mobile app that provides in-hotel service menus, maps, and customized itineraries. Of course, these are just initial ideas, as mobile loyalty is fairly new. A successful full integration of a hotel loyalty program (“full integration” meaning that the guest has access to everything that the traditional program provides, plus all mobile-specific features in one mobile-convenient package or app) is an intensive undertaking. All departments are affected, and all departments need to have input into how the system should be implemented.

Mobile Loyalty: Anywhere, Anytime

Integrating mobile with an existing loyalty program involves restructuring that program to exploit the advantages of the mobile channel. It is my view that this involves redemption rewards that are distributed based on mobile’s key benefits to guests: access anywhere, at anytime. In addition, traditional rewards, in the form of personalization, recognition, and convenience should be integrated into the loyalty program. While this is an expensive and time-consuming process, the “reward” will be a robust program that takes full advantage of and conforms to all the benefits that the mobile channel and its devotees are looking for. The only way to ensure that a mobile loyalty program will be compatible with your existing program is to integrate both of them (remember, it’s a two-way street): traditional programs should look to retool operational efficiency to provide mobile customers with the rapid decisions and flexibility they need and want. And mobile should be integrated into the traditional system and used as a vehicle for the traditional program to connect with the guest.

In this day and age, with loyalty shrinking and the economy struggling, mobile is the “shot-in-the-arm” that hotel loyalty programs need.

And, as with most other things in the hospitality industry, implementation is everything.

Chief Visibility Offer, ThinkInk & TravelInk’d Vanessa Horwell is the founder and Chief Visibility Officer of ThinkInk & TravelInk’d, a public relations and visibility firm that shuns press releases in favor of storytelling. She has spent the past 18 years working with companies in the US, UK and Europe, developing successful campaigns and strategies for their brands. Ms. Horwell is a senior level strategist who works with companies in North America, EMEA and Asia-Pac in developing winning media campaigns, building relationships with influencers, and improving visibility through a unique style of public relations. Ms. Horwell can be contacted at 305-749-5342 or vanessa@thinkinkpr.com Extended Bio...

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