Hospitality Loyalty Programs: Time for Disloyalty?

 

By Robert McGarvey

 

We like our loyalty programs. That’s a fact in recent research by Phocuswright and Acxiom which found four in five US travelers belong to loyalty programs.

The story’s headline hammered the point home: US Travelers Are Heavy Users of Loyalty Programs.

But it twisted this knife in the sub-head: But travel trails several other verticals in the popularity of such plans.

What do you think?

Curiously the study found business travelers are more committed to loyalty programs than are leisure travelers. But not by much.

62% of business travelers are signed up for a hotel’s loyalty program, compared to 54% of leisure travelers.

As for air, 60% of business travelers are signed up for an airline’s program, compared to 50% of leisure.

Count me as seriously surprised that 40% of business travelers aren’t in an airline program – and more are in hotel programs than air.

I agree: air frequent flier programs have gotten progressively more worthless.  But in my mind, as long as I don’t alter my behavior to “succeed” in a program, whatever crumbs I’m tossed for my meager loyalty are welcome.

Personally in fact I belong to a packet of loyalty programs. American Air, United, Southwest, Hyatt, Hilton, and a few more hotel programs that I’ve probably joined multiple times because I don’t keep track of the log in details and when I want to claim a loyalty member perk, like free wifi, I join again.  

There were others I’ve been automatically enrolled in due to patronage – several cruise lines for instance – but I never kept track of those, either.

In all programs nowadays my loyalty is thin.  Fragile.

When I think of loyalty programs here’s what comes to mind. A few months ago I realized that there are Murray’s Cheese counters at some Fry’s supermarkets in Phoenix. I had a hankering for Cabot clothbound cheddar – the best domestic cheddar imo – and decided the Fry’s Murray’s probably sold it so I ventured into a Fry’s.

The cheese was in. But I was in a supermarket, so I tossed other stuff in the cart and at checkout of course I got a Fry’s loyalty card to get the member discounts on paper towels and bathroom cleansers.

I won’t return until the next time I crave Cabot clothbound.  (I shop at Trader Joe’s and Whole Foods.) I have zero loyalty to Fry’s – tho I like the discounts.  My loyalty is to Murray’s and Cabot.  

Very probably your loyalty to many – most – programs you belong to is also thin.  

I remember knowing – I was one myself – very loyal Continental Air passengers.  Flying out of Newark, often to Houston on business, there was no budging me out of Continental and I liked the many perks the airline showered on me for my loyalty. There was a time when if I didn’t get an upgrade to business class I somehow felt cheated.  That’s how often I got the upgrades.

But in recent years I have gotten bupkis and, honestly, the only travelers I know who express satisfaction with loyalty programs are the super elites, the kind who log well over 100k miles annually and 100+ room nights. They are happy.

The rest of us not so much.

That’s underlined in additional research by Bond Brand Loyalty that found only 39% of us expressed satisfaction with airline loyalty programs. That fell to 38% for hotel programs.

My surprise is that the numbers are that high. I would have guessed maybe 25% – one in four of us – for both categories. There’s just not much to be loyal to.

What’s interesting in that Bond Brand Loyalty survey is that in all but one category less than half of us expressed happiness with the various loyalty programs we belong to.

Credit cards, said Bond,  managed to hit 52% of us claiming satisfaction. And that’s the best.

Hospitality companies are performing at a mediocre level but it’s not that far off the performance of other kinds of retailers. They all sleepwalk through loyalty.

Message to retailers: if you want us to take loyalty programs seriously it starts with you. You need to take them seriously and upgrade them.

That message is all the louder in hospitality.

 

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