ALAMEDA, CA—While loyalty programs are often lauded for their ability to engage the guest, these platforms also provide valuable data about guest behavior to a company—and, these days, data is key.
“Guest engagement and personalization is what any hospitality company strives for,” said Absolutdata CEO Anil Kaul. “Members of the loyalty program leave immense data footprints, which, if captured and analyzed properly, provide insights that can help understand and personalize guest offerings.” This data can answer questions such as which guests are more likely to travel next month. And, of those guests likely to travel next month, the data can clarify the following: What would be the most likely destination of travel? Would it be a business or vacation trip? What would be the most likely hotel and room type that they will book? What would be the most appropriate offer or promotion? What would be the most likely services that will be availed during the stay?
“The above areas help marketing, operations and loyalty teams understand guest preferences and drive greater personalization, along with meeting their business objectives,” said Kaul. He noted that some of the information needed to do this include historical stay-related data (including booking details, spend details, room rent details, etc.); historical promotion data (promotion channel level data of promotion offered, promotion time and date, etc.); customer data (demographics, psychographics. etc.); customer satisfaction data; and loyalty points data (points earned, burned, etc.).
According to Kaul, hotel loyalty programs face many challenges: lack of differentiation from other offerings; a drop in customer loyalty as guests switch between multiple programs; wrong targeting because players do not leverage analytical capabilities; overtargeting, which leads to disengagement and dissatisfaction; increased customer awareness of various loyalty programs and their benefits; and lack of coordination between departments. “Every different department in a company—like revenue, marketing, etc.—is working in silos and not sharing data or coordinating,” he said.
To avoid some of these pitfalls and maximize loyalty programs, companies should engage customer 360. “Set up a process to capture customer level data—stay related, demographics, psychographics, customer satisfaction, etc.—and integrate them to get a single view of the customer, which is called customer 360,” said Kaul. Additionally, companies should set up a process “through which various advanced analytics techniques can be applied to gain actionable customer insights, and another through which targeting can be done at a customer level based on the actionable insights generated.” Moreover, companies need to track customer engagement. “Raise alerts the moment engagement level drops below a particular threshold,” he said. “Then, target them to get them back to the desired level of engagement.”
Kaul also stressed the importance of differentiation for having long-term customer loyalty and effective communication with the customers.
—Nicole Carlino