Building Sustainable Guest Loyalty in Hotels: Where True Loyalty Comes From

No, I will not talk about points programmes, discounts or loyalty cards. Rather, quite the opposite. When we analyse a hotel’s performance data, we fuel our need to reposition our hotel, as well as the need to build customer loyalty so that we do not have to pay so much in commissions. The study and implementation of customer loyalty programmes is becoming increasingly important for hotels in a hyper-competitive world dominated by intermediaries. The problem is that, in most hotels, when we talk about encouraging loyalty, it is done through discounts or added value at no additional cost to the guest, prioritising repeat business without generating any empathetic connection—the true foundation of loyalty. What is more, we often end up offering these discounts to many guests who have no interest in returning, meaning the opportunity cost in such cases is significantly high. It is worth taking a few minutes to consider:

1. What truly builds loyalty among my guests?

2. What does their level of loyalty depend on?

3. How likely is it that this loyalty will fade?

Then, without needing me—or anyone else—to answer these questions, we will realise that we are not really doing something right. The need to implement a loyalty-based strategy requires the hotel to be prepared and updated in line with market and competitive trends, as well as technology and, most importantly, the guest’s free and powerful mindset, which ultimately sets the pace for achieving our objectives. To do this, a change in mindset is essential if we are still immersed in outdated programmes and philosophies based on stimulating loyalty through discounts and giveaways. This is what I understand by Innovation, and it is what the current moment demands, together with a revolution in management models. It means consistency in change, adapting to developments in the environment, monitoring events and trends, and having a strong ability to anticipate the needs, preferences and expectations of our “desired” guests. To carry out a loyalty-based strategy, we first need to set a goal towards which to direct our actions, and that reference point must represent the creation of value for the guest. I am referring to the who? why? how? when? and where? behind my previous questions. From this, a series of steps follows, ranging from a redefinition of the guest—including new market segmentation, guest knowledge and so on, closely linked to CRM and micro-segmentation tools—to the review and analysis of human capital, re-education and training in the philosophy and techniques of internal marketing, and the redesign of incentive programmes in conjunction with Revenue Management activities. It is certainly good to have large budgets, but it is more important to have clarity and ideas to activate the strategy in a robust way. This does not necessarily have to involve major investment, even when we consider every angle. It is understood that one of—if not the most—important conditions for achieving stronger and sustained results over time is gaining guest loyalty. It also means delivering outstanding value: a proven way to achieve guest satisfaction and, from there, sustained loyalty. In a sector such as ours, where competition is fierce, guest loyalty is far more important when it comes to a hotel’s growth and its ability to generate immediate profits. Due to the particular characteristics of the tourism market, maintaining market share as a strategic focus is, at this moment, far more important than increasing it in the short term. This is why integrating loyalty into the company’s core strategy takes on even greater relevance. The success of a strategy of this kind comes when the different areas are integrated to execute it: in other words, when Marketing is integrated with Sales, Revenue Management, Guest Relations, Operations, Food and Beverage, Administration, and so on. It means aligning timing and execution… every moment must be integrated at the right time.

Loyalty, viewed as a strategic objective, generates greater loyalty.

Making the most of the loyalty of those guests—the genuine kind, not the kind that depends on a discount or a gift—is in itself one of a hotel’s greatest assets: a marketing campaign that works on its own, automatically, without investment, and with highly effective results. Guests who demonstrate loyalty to our brand take actions in our favour and display behaviours that ultimately create value and reduce costs. Through this voluntary engagement, they tend to repeat their purchases and adopt and use new services from our company or hotel. In many cases, these guests with proven loyalty become advisers and marketers of our products and services, showing a deep resistance to the offers and temptations presented by competitors. True loyalty also discourages guests from seeking new accommodation alternatives. A satisfied guest who has become loyal to our services, products and processes feels cared for, secure and fulfilled with us. Therefore, we have a high probability of retaining their visits over time, with price becoming a secondary consideration. When guests perceive that they gain benefits from consuming our brand and receive special treatment, that feeling—and their need to keep searching—is reinforced, because they know what they will receive from our service and are open to experiencing that satisfaction. However, perhaps the key to implementing an effective loyalty programme within our strategy lies in building loyalty among our internal customers: our people. They are the ones who deliver each of our promises to external guests, execute our plans and interact with them. In short, they are the participants, the centre and the mediators of every interaction that takes place in our company or hotel with each guest. The guest’s perception of service quality largely stems from and develops through this relationship. It is therefore the first focal point in achieving guest loyalty. The “care” we give to our human capital, their training and education in the company philosophy, as well as the opening of communication and participation channels between them and the “structure”, are decisive in achieving the strategy.