Do Loyalty Programs Actually Help Your Brand?

Research points to declining associations between brands and loyalty programs

By Larry Mogelonsky President & Founder, LMA Communications | October 06, 2013

I've long held the belief that too many major hospitality brands and too many big names operating in the hotel space can seriously confuse travelers. As a result, this leads to less overall awareness of your brand's unique qualities and, ultimately, decreasing loyalty. By itself this is a very loose argument. However, a recent study spearheaded by my friend, Laurence Bernstein, managing partner at the research firm, Protean Hospitality Partners, has confirmed this sentiment.

For this study, 400 US business travelers participated in an online survey asking them to associate 36 hotel brands not containing the name of their parent chain with one of the following seven loyalty programs: Choice Privileges, Hilton Honors, Hyatt Gold Passport, Marriott Rewards, Priority Club, Starwood Preferred Guest (SPG) or Wyndham Rewards.

Results That May Surprise You

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On average, only 20% of these pairings were correct. Moreover, participants had the option to tick a 'Don't Know' box for each of the 36 hotel brand prompts, of which this selection was made 52% of the time. Either way, this indicates that knowledge of loyalty programs associated with various brands is drastically below where it should be.

Drilling down to the individual percentages, there are some standouts worth noting. Courtyard, when presented independent of its 'By Marriott' namesake, was correctly identified 65% of the time as part of the Marriott Rewards program – the best percentage of the lot. Other victories include Comfort Inn (41%) and Quality Inn (36%) for Choice Hotels; Garden Inn (37%) and Hampton Inn (30%) for Hilton Worldwide; Residence Inn (35%) for Marriott; Holiday Inn (33%) for InterContinental Hotels Group; and Sheraton (31%) for Starwood Hotels.

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Mobile Technology: The Future is Now

Mobile Technology continues to advance at a relentless pace and the hotel industry continues to adapt. Hotel guests have shown a strong preference for mobile self-service - from checking-in/out at a hotel kiosk, to ordering room service, making dinner reservations, booking spa treatments, and managing laundry/dry cleaning services. And they also enjoy the convenience of paying for these services with smart phone mobile payments. In addition, some hotels have adopted a “concierge in your pocket” concept. Through a proprietary hotel app, guests can access useful information such as local entertainment venues, tourist attractions, event calendars, and medical facilities and services. In-room entertainment continues to be a key factor, as guests insist on the capacity to plug in their own mobile devices to customize their entertainment choices. Mobile technology also allows for greater marketing opportunities. For example, many hotels have adopted the use of “push notifications” - sending promotions, discounts and special event messages to guests based on their property location, purchase history, profiles, etc. Near field communication (NFC) technology is also being utilized to support applications such as opening room doors, earning loyalty points, renting a bike, accessing a rental car, and more. Finally, some hotels have adopted more futuristic technology. Robots are in use that have the ability to move between floors to deliver room service requests for all kinds of items - food, beverages, towels, toothbrushes, chargers and snacks. And infrared scanners are being used by housekeeping staff that can detect body heat within a room, alerting staff that the room is occupied and they should come back at a later time. The January Hotel Business Review will report on what some hotels are doing to maximize their opportunities in this exciting mobile technology space.