When I worked eighty hours per week as a management consultant, spending hundreds of nights per year at hotels, my colleagues and I burned our hard-earned rewards points on trips to New York, San Francisco, Malta, Belize, and other destinations near and far. On rooftop bars and in breezy hammocks we would dream. Our dream: to open an incredible, one-of-a-kind resort together. We each had our roles. The strong negotiator would raise capital and manage development. The amazing cook would develop F&B concepts. The yogi would run the spa. And I would be in charge of marketing.
Maybe you’re reading this because you feel the same way. Or maybe you have recently accomplished the tremendous feat of designing and developing your own independent hotel concept. Maybe you’ve recently invested millions in a property that could use some love and fresh thinking and are now re-opening or relaunching it. Or maybe you just want to take your property to the next level.
You have hired, or are going to hire, awesome people who will surprise and delight your guests to create shareable, unforgettable experiences.
But wait! How will people know about your wonderful new concept? Shouting from the rooftops may feel liberating, but it won’t fill hotel rooms. How will you not only put heads in beds, but also command high rates in line with the outstanding experience you offer, and keep your first-time guests coming back at as low of a cost as possible?
To achieve your goal, you may consider signing a franchise agreement, but the cost, commitment, and loss of control gives you pause.
What are the alternatives? Hiring analysts to back into the TripAdvisor ranking algorithm so you can ensure your new hotel, with limited reviews, snags a top spot? Sacrificing margins for a high placement in Expedia search results? Listing last minute, deeply discounted rooms on HotelTonight? Investing heavily in marketing and PR hoping to get national or industry coverage? Here’s a better option:
Join a points-based loyalty program.
- Raise your profile. The right program is not only a points program, but a curator and a stamp that signals quality. Raise your profile by affiliating with a network of like-minded hoteliers with more marketing power than a single property. Once word gets out to members that your hotel is now part of the program, you can prepare to open your doors to a bunch of brand new guests. They know that if the program trusts your hotel, they can trust your hotel.
- A marketing channel that works. Invest in a marketing channel that provides concrete benefits for your guests. Your dollars aren’t all going into the marketing and PR abyss. They are going to points for your guests that they can collect and use to stay at your hotel and other amazing destinations, with a real ROI. And points work: according to Google Insights*, 96% of affluent travelers belong to loyalty/reward programs. The number one reason they sign up, and the number one program feature they value, is the ability to earn free flights, hotel rooms, etc. 85% of those affluent travelers also said they are likely to book hotels based on loyalty program membership.
- Make new friends. Take a hard look at the guests you enroll in your program, not because you won’t see them again, but because they are your new friends. To personalize their stay and begin a relationship, you can access information on the profile they’ve created. Members are more likely to open and click through your emails, and, more importantly, they stay and spend 50% more than non-loyalty program members (the experts from Cornell can tell you about the study they performed to prove this).
- Win group business. Is group and corporate business important to you? Good luck winning those clients over without a points-based loyalty program. The meeting planners and corporate travel managers your sales team is talking to know that they can earn points for their personal use if they book with one of the big chains. Do you really want that difference to be the reason they don’t consider you or don’t book with you? Don’t handicap your sales team. Level the playing field by giving your sales team a tool they can use to compete.
- Count on your direct bookings increasing. Third party bookings don’t earn points. Loyalty members book direct. Enroll new third party guests in your loyalty program, and chances are they will book direct next time. Wean your revenue management strategy off OTAs, own the relationship, and start counting the savings and loyal guests.
- Be fiercely independent. You want this hotel to be your baby, not a box with standards dictated by a head office. An independent hotel-focused, points-based loyalty program lets you be you. But if you want to connect with peers to get some background on a possible new vendor, discuss an industry trend, or learn best practices for service recovery, you have a network of likeminded hoteliers with whom you can consult.
Of course, as part of our gatherings, my colleagues and I compared our loyalty program statuses and point balances and researched our next point-redemption trips. We also agreed our dream resort would be part of an amazing points-based loyalty program.
If only one existed for amazing independent hotels like the one we planned to open…
Wait, these conversations all happened before spring 2010, when Stash Hotel Rewards was founded!