In the first part of this blog post, we have read about interesting ways to cash on customer loyalty.
Every hotel or travel business is dependent on its customers for churning revenue. While hoteliers must be already thinking along these lines, but we can’t ignore the fact that an existing client pool is always the easiest, profitable and most predictable source of revenue for a hotel.
In all conscience, customer loyalty is not an alien concept in the hospitality industry, for this industry has played a pivotal role in inventing customer experience and loyalty programs. Every revenue strategy envisioned today by leading hotel chain owners, ranging from star-ratings to brand consistency, focuses on creating a positive guest experience.
So the fundamental idea is that every existing and loyal customer knows all about your brand and is easier to please than new prospects.
Forbes magazine recently revealed that acquiring new customers costs five times more than retaining existing ones. So, hoteliers must figure out ways to attract and retain current customers, for it is a more cost-effective procedure than constantly marketing to new customers.
Connect with the most valuable guests
Foster satisfaction and loyalty to guarantee future revenue of your hotel business. This step will make it easier to get repeat business as well as attract new customers (especially the ones who follow ratings and reviews). But the point in the discussion is, as an hotelier, how should you practice targeted customer loyalty to bring in the biggest value over a guest’s lifetime?
For this, you have to get a holistic view of a guest’s lifetime value, not their room-rate spend to understand the most valuable customer. To do such an all-inclusive assessment, integrate data from all transaction systems to get the true picture of a guest’s preferred activity & choices and of course their feedback too.
Inspire long term loyalty amongst already loyal patrons
After you identify the most valuable guests, put strategies in place and make these guests feel highly welcomed and special and not just welcomed at your hotel. Give out VIP check-ins, free Wi-Fi, include other items (such as champagne, chocolates or flowers), treat them with a complimentary spa treatment, mini-bar in the room, etc. Such tactics throw light and emphasis on the fact that a guest’s patronage is acknowledged and valued by the hotel.
End of the day, it is a hotel revenue manager’s job to assign better pricing and room types to a loyal guest. While carrying out the task, they have to keep three things in mind:
- Target accounts with larger volume
- Chalk out longer stay patterns
- Plan with great propensity to generate ancillary revenues
In case the revenue management funnel is perfect, a hotel’s marketing or customer service department has to attract the money-spinning client pool. After all, it is the improved treatment of top guests through special booking processes, which can drive revenue targeted customer loyalty.
Role of the Marketing Department
Integration of decisions from revenue managers and marketing departments is crucial for any hotel. Bringing both sides on the table can help retain guests effectively, provided real-time data accessibility is available. On the basis of this data, campaigns can be created which will eventually foster customer loyalty strongly.
Further, on the basis of forecasted demand, targeted promotional campaigns can be designed for the specified market segment, which will for sure ensure demand generation. So that the right decisions about pricing and promotions are made, which will lead to more revenue.
The dynamic hospitality landscape is constantly leading to re-orientation of roles and responsibilities across revenue, marketing, and all other departments. Based on these changes, hoteliers have to build an innovative revenue management culture, in order to come up with a fact-based guidance and more learned strategy, which will further maximize their revenue opportunities.
Hence recognizing the most valuable guests, fostering them and setting the best possible prices can lead to the timely analysis and determination of top promotional funnels. All such campaigns will eventually attract repeat customers, develop lifetime loyalty and finally get the revenue bells ringing for your hotel.