Positive reinforcement is a useful concept. When psychologist B.F. Skinner refined the idea in the 1960s, he uncovered this clever tidbit: an action that garners a reward is likely to be repeated. Skinner proved that it’s in our nature to choose a sweetened deal, and loyalty rewards programs are perfect — and popular — examples of his theory in practice.
Canadians love to rack up rewards, whether they translate into points at the pump, miles at the supermarket checkout or bargains at a favourite retailer. A 2009 survey by the Cincinnati, Ohiobased research firm Colloquy showed 93.6 per cent of Canadian consumers — a remarkable majority — belong to at least one loyalty program. Hotels across Canada and around the globe are continuously improving their programs to offer the sugarcoated incentives required to attract and retain guests. Members of Travelodge Hotels’ Guest Rewards program, for example, earn 10 points for every lodging dollar spent at any of the chain’s hotels nationwide. They can begin to reap their rewards — such as a freenight’s stay or gift certificates with program partners, such as Canadian Tire, The Keg and iTunes — once they’ve accumulated 7,500 points.
“Our program makes it very easy for customers to reach the redemption level and has many partners that make it appealing to a wide range of people. It attracts guests, but we still have to earn their loyalty,” says Patti Hunt, Travelodge Canada’s director of Marketing and Communications. “The program gives us an opportunity to make our brand topofmind for guests who are considering where to stay.” The program also entices members to earn their 7,500 points and achieve “gold” status, by offering perks such as early checkin and late checkout to those who do. Guests who accumulate 70,000 points become “platinum” members and have access to executive lounges and room upgrades when available.
Travelodge execs are relaunching the brand website and looking forward to integrating social media into the marketing mix, including the guestrewards program. “We want to make sure we introduce socialmedia applications for the right reasons, not just because everyone else is doing it,” says Hunt. The marketing strategy already includes incentives for employees who enroll guests in the program. “We’ve had several successful drives to increase membership by offering cash bonuses to employees. Our onsite staff does a great job of explaining the benefits of membership to the customer,” she says.
Employees of Best Western Hotels are also encouraged to enroll guests in the Best Western Rewards (BWR) program. While there are no cash bonuses on offer, staff — from the front desk to the call centre — earn 250 BWR points for every new registration. “We want to keep the emphasis on the value of rewards so our employees can communicate the benefits of the program firsthand,” says Tammy Lucas, Best Western’s managing director of Marketing Programs.
BWR (formerly Gold Crown Club International) boasts 12.5million members in North America. Members can earn and redeem points at more than 4,000 hotels globally, collecting 10 points for every U.S. dollar spent on room rate. And, there’s an option to earn with program partners, such as Aeroplan and Air Miles. BWR has more than 17 airline partnerships and redemption relationships with Sears, WalMart, Home Depot and other retailers. The program also has various levels of membership — gold, platinum and diamond — each with its own special perks.
“Best Western Rewards is a key marketing program for our brand that delivers strong revenue. It allows us to provide superior customer care and to consistently communicate with our members,” Lucas says. “Social media is an integral part of the strategy. It gives us an opportunity to engage with and retain our members.” The BWR Facebook page is a portal for program promotions, a platform for customer feedback and a space where members can become brand advocates by sharing their experiences.
“The market is saturated [with loyalty programs], so we’ve leveraged our national promotions to attract more customers. Our rewards members command a higher ADR than nonmembers and that drives us to continue to focus energy there,” Lucas says. In summer 2011, BWR members who stayed on three separate occasions, were eligible for a free night’s stay, up to 13,000 bonus points and a chance to win a trip to Hollywood, Calif., to attend a Disney TV event. “We make sure our sweepstakes promotions are relevant to our guests, and they are very successful,” she says.
Relevance and personalization are key elements of Starwood Hotels’ Starwood Preferred Guest (SPG) program. Millions of SPG members participate at more than 1,050 properties worldwide, including Sheraton, Four Points, W Hotels, Le Méridien, Element, Westin and St. Regis. Beyond some of the more typical perks of a loyalty program, SPG members can use their points on “experiences” that fall into three categories: music, sports and the arts. Love rock ‘n’ roll? Attend an acoustic performance by the Goo Goo Dolls with just 250 other SPG members. Need to improve your long drive? Hit the green for a round with professional golfer Colin Montgomerie.
“We’ve really ramped up the experiential aspect of the program in the past year, and we’re offering more than ever. We’ve created partnerships with Live Nation [a music ticket sales website] and the PGA,” says Gretchen Kloke, Starwood’s vicepresident of Global Loyalty Marketing. In July 2011, SPG held a preparty for members attending a U2 concert (Some lucky SPGers were even treated to a stage tour before the show.). Starwood aims to make its experiences relevant for members, wherever they are. In India, for example, the company has partnered with a popular cricket team.
SPG members at entry level earn two star points for every U.S. dollar spent on room rate. Ten stays or 25 nights in one calendar year moves membership to “gold” status, and 25 stays or 50 nights in a calendar year equals “platinum.” Members in the upper tiers earn three points per dollar and have access to upgrades, such as free hispeed Internet and late checkout. The program has a noblackoutdates policy for members, which means free nights can be redeemed any time throughout the year, if there is availability. “SPG actually feeds our system. When we have a new opening, there’s instant occupancy,” Kloke says. Starwood’s newest brands, Element and Loft, see member occupancy rates of 60 per cent and 50 per cent respectively. Luxury brands St. Regis and W Hotels also report close to 60percent member occupancy.
“Our members are loyal across many of our brands, and we tap into that. We use those guests as a sounding board. Through socialmedia interaction they teach us how to tinker with details and make timely improvements,” Kloke says. She notes that while applications such as Facebook are excellent mediums for staying connected, they also require constant monitoring. Starwood has a callcentre team dedicated to staying on top of interactive customer feedback.
Fairmont Hotels also centres its rewards program, Fairmont President’s Club, on personalization. Guests complete a profile upon registration sharing their preferences on important details such as the type of bed they like, their ideal floor level, favourite newspaper and whether they drink carbonated or still water. “Our program is more about the person and less about points,” says Brian Richardson, Fairmont’s vicepresident of Brand Marketing and Communications. The program, which has close to twomillion members globally, is actually not based on points. “We did research with guests and prospective guests, and the results showed they were not interested in another points program. Our loyalty program is intended to drive repeat business and create commitment. We do that by catering to our guests,” he says.
Recent dialogue with members showed health and wellness on the road is important but can be difficult for those who travel light. So, Fairmont partnered with Adidas to create a program whereby fitness apparel — a Tshirt, shorts and sneakers — is available to members who request it. The new perk has been a big hit. “Not having to pack your running shoes is a huge convenience. The most important thing with our program is to continue to evolve and to seek out what’s meaningful for the guest,” Richardson says. “The challenge is in not becoming complacent.” Fairmont President’s Club might not offer Canadians the chance to bank points, but having the perfect pillow, in the ideal room, stocked with your favourite snacks and comfy footwear, sized to fit, is a pretty sweet deal.
Offering loyalty program perks is a great way to encourage longer stays, and extra nights help increase occupancy and ADR. From June 1 to Sept. 5, Travelodge Guest Rewards members received a $25 Petro Canada voucher in addition to their regular program points, with every fivenight stay. The increasing and unpredictable price of gas made the summer roadtrip promotion extremely successful. Guests could earn up to three cards throughout the summer and many did. Travelodge runs seasonal promotions throughout the year to boost program membership and stay connected to guest needs.
Lest we forget:
Hotel Operators can cash in on their allegiances, too. The same way guests earn points and perks for their repeat business, hotels providing foodservice can benefit from supplierbased loyalty programs.
Foodservice Rewards, for example, is an online program — with partners, including Kraft Foods, Nescafé, Kellog’s and hundreds more — whereby members earn points by purchasing items with participating brands via foodservicerewards.com. Instead of redeeming points for a free night’s stay or room upgrade, hoteliers can choose from a list of rewards, ranging from practical pieces such as a ladder or hotfood serving tray to fun stuff such as a barbecue or handheld digital video recorder. Rewards can be used for business improvement or passed along to an employee for a job well done, at essentially no cost to the operator. Membership is free and the perks of belonging are making supplierside loyalty programs a popular choice.
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