What Hotels Can Do to Build Brand Loyalty with Millennials

By Lisa Ross President & Partner, rbb Communications | January 20, 2019

They're young, active, travel-savvy and eager to choose experiences over physical purchases, so it's easy to see why millennials are the group to nurture when it comes to hospitality. The challenge -- building brand loyalty with them is easier said than done. These travelers, many of whom had a front-row seat to the late 2000s financial crisis, are keenly aware of their own spending, making them a tough group to capture with old-school loyalty plays such as points programs. In fact, according to one study, 80 percent of millennial travelers said they would switch their brand allegiance just to save a few dollars.

So where does that leave brands? Building loyalty with this demographic will take more than a few generic offerings, meaning brands need to think big when it comes to strategy. Experiential offerings, social media engagement, corporate social responsibility and lifestyle-based partnerships should be at the heart of forward-thinking millennial loyalty initiatives. Here are a few ways hospitality brands should aim to earn – and keep – millennial attention.

Think Alternative

Though millennials are notoriously price-conscious, they're also open to benefits beyond the dollar. A 2018 study by Visa and Bond Brand Loyalty showed that the group places high importance on alternative benefits, such as quicker check-in and check-out for members or choice of room and/or floor. In fact, 46 percent of millennials are willing to pay more for enhanced loyalty benefits, the study found.

These include, for example, Amazon Prime – which offers free two-day shipping, streaming movies, special sales and other benefits – and Restoration Hardware's RH Members Program, which offers 25 percent savings on all purchases, as well as complimentary interior design consultations and concierge services. In addition to discounts and additional services, millennials are often willing to pay for convenience, such as Instacart's two-hour delivery from local stores.

As part of your loyalty programs, offer rewards for travelers who share their experiences. Non-hospitality brands have found that this generation responds to rewards offered for actions such as sharing posts on their social media, referring friends and responding to emails or surveys. In other words, millennials are looking for an equal partnership – be loyal to them and their needs and they'll be loyal to yours.

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Coming up in March 2019...

Human Resources: An Era of Transition

Traditionally, the human resource department administers five key areas within a hotel operation - compliance, compensation and benefits, organizational dynamics, selection and retention, and training and development. However, HR professionals are also presently involved in culture-building activities, as well as implementing new employee on-boarding practices and engagement initiatives. As a result, HR professionals have been elevated to senior leadership status, creating value and profit within their organization. Still, they continue to face some intractable issues, including a shrinking talent pool and the need to recruit top-notch employees who are empowered to provide outstanding customer service. In order to attract top-tier talent, one option is to take advantage of recruitment opportunities offered through colleges and universities, especially if they have a hospitality major. This pool of prospective employees is likely to be better educated and more enthusiastic than walk-in hires. Also, once hired, there could be additional training and development opportunities that stem from an association with a college or university. Continuing education courses, business conferences, seminars and online instruction - all can be a valuable source of employee development opportunities. In addition to meeting recruitment demands in the present, HR professionals must also be forward-thinking, anticipating the skills that will be needed in the future to meet guest expectations. One such skill that is becoming increasingly valued is “resilience”, the ability to “go with the flow” and not become overwhelmed by the disruptive influences  of change and reinvention. In an era of transition—new technologies, expanding markets, consolidation of brands and businesses, and modifications in people's values and lifestyles - the capacity to remain flexible, nimble and resilient is a valuable skill to possess. The March Hotel Business Review will examine some of the strategies that HR professionals are employing to ensure that their hotel operations continue to thrive.