What is a hotel loyalty program?
A hotel loyalty programs, or a hotel rewards program, is a means of encouraging customer loyalty by rewarding returning guests with perks. Hotels offer better perks for increased loyalty. This encourages repeat visits and ultimately leads to more revenue for the hotel. As customers normally travel to different destinations, loyalty programs are especially effective for hotel chains with properties in many locations.
How does a hotel loyalty program work?
Similar to air miles, most hotel loyalty programs offer points for every night spent at the hotel. As a guest accumulates points, their status level in the program advances. As levels ascend, so do the quality and quantity of rewards. Business travelers usually dominate the top levels of a hotel loyalty program due to the frequency of their trips.
Rewards are an incentive for customers to return to a chain, therefore increasing business for the hotel. As a result, there is competition between hotels to provide the best perks. Common rewards include:
- Wi-Fi access
- Free parking
- Free breakfast
- A welcome gift
- Free nights
Hotel credit card
Many hotel chains are associated with a credit card, and by virtue of owning the card, guests automatically receive benefits. Furthermore, like with frequent-flyer programs, when guests make purchases with the credit card, they receive points for their hotel loyalty program.
As airlines and hotels go hand in hand, especially for corporate travel, hotel loyalty programs often affiliate themselves with airlines. These partnerships usually result in customers being able to earn air miles when staying in hotels or vice versa. Further advantages to hotel loyalty programs in affiliation with airlines include access to VIP lounges and other airport perks.
Independent hotel loyalty programs
While the majority of programs are run by major chains or hotel groups with properties all over the world, some exist to unite independent hotels.
For example, The Leading Hotels of the World unite luxury hotels that are not part of a chain. Although a hotel does not directly benefit if a customer stays at a different hotel in the group, the customer is more likely to visit the first hotel due to the loyalty program that links them.
Are hotel loyalty programs worth it?
In the long run, hotel loyalty programs reduce costs while increasing benefits. Furthermore, as most loyalty clubs are totally free to join, there is no real downside.
Which hotel loyalty program is the best?
As trends in what customers want change, so do trends in hotel loyalty programs. For example, while free Wi-Fi used to be a luxury, it is now standard. Therefore, it is difficult to pinpoint the best rewards program.