Buy a Hotel with a Loyalty Program in Mind

When you buy a hotel, a few initial concerns that come to mind are how to attract more customers and how to increase reservations. Many hotels utilize a loyalty program not only to increase their customer base, but to also increase the customer return rate. Although loyalty programs seem very enticing, there are both advantages and disadvantages to this type of strategy.

Types of Loyalty Programs

A loyalty program is a strategy that provides customers with incentives for frequently purchasing a business’s services or goods.

The types of hotel loyalty program options are limitless. After you buy a hotel, you can create your own program based on your marketing strategy, guests and business needs. Several hotel loyalty programs allow guests to accrue points based on the amount spent at a hotel. Once the guest accrues a certain amount of points, he or she receives benefits such as a free night’s stay or a discounted hotel room rate.

Advantages to Loyalty Programs

Some advantages to loyalty programs include:

• Repeated Business: Due to the fact that loyalty programs provide incentives such as lower hotel room rates, it is likely that guests will return to your hotel, increasing reliable reservations.
• Competition: When individuals are searching for a hotel, they compare prices, incentives and location. If you market your loyalty program successfully, new guests will be attracted to the benefits of the loyalty program, choosing your hotel over other competitors.
• Insight: Loyalty programs also allow you to get to know your guests. Knowing your guests’ preferences helps you create strategic marketing campaigns that result in more reservations.

Disadvantages to Loyalty Programs

Some disadvantages to loyalty programs include:

• Generic: Loyalty programs are not unique. Almost every hotel or travel agency has some sort of reward system. Unless your loyalty program provides more benefits than others, it does not significantly set you apart.
• Lost Revenue: Depending on the type of loyalty program you offer, you can lose revenue without any gains.
• High Points: The point system for loyalty programs can become frustrating to guests if the point goal is too high. For someone who does not travel very often, it may take them years to obtain any rewards.
• Complex: Many times, guests can become confused with your loyalty program and how it works. If your loyalty program is not straightforward, you can end up losing guests out of sheer frustration.

Other Ways to Gain Loyal Customers

If you buy a hotel and you are opposed to using a loyalty program, there are several other successful ways to gain new and returning customers. Some strategies include:

• Implement appealing offers, advantages and incentives
• Provide outstanding customer service
• Increase marketing and social media efforts
• Provide services that allow convenience and ease

Choose Southeast International When You Buy a Hotel

If you would like to buy a hotel, the assistance of a hotel broker is not a luxury, but a necessity. At Southeast International, our experienced hotel brokers offer expert advice and resources to find the best hotel for your needs. Contact us to speak with one of our hotel brokers before you buy a hotel. We are happy to assist you.