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Insight: Hotels win with connected loyalty strategies

Over at Hotel Executive, commentator Allison Ferguson encourages hotel marketers to connect their loyalty programs to the digital experience and the end-to-end travel journey in order to win the hearts of those "connected travelers" who control an estimated $180 billion in global travel spend. By doing so, Ferguson argues, hotels can stop ceding the lion's share of the travel experience to the online travel agencies (OTAs).
 
By Rick Ferguson
 
Ferguson points out that hotels are already innovating in the digital experience, citing Starwood, Hilton, and Marriott as brands offering the digitally-connected traveler the opportunity to self-serve and customize their own travel experience. The opportunity, Ferguson notes, is in providing additional value in the digital experience, and additional flexibility in the loyalty program, to engage the connected traveler at every stage of their travel experience. Money quote:
 
"Via their loyalty programs, however, hotel brands can do more to serve travelers in earlier and later stages of the sales cycle as they imagine, plan, book, and share their hotel stay experience. By their very nature, loyalty programs generate a wealth of data, offering a unique memory of member preferences, spend, and habits that hotels are for the most part not using to anticipate and assist travelers throughout their journeys. By not leveraging their proprietary loyalty data to improve the travel experience, hotel brands are ceding parts of that experience - including parts enjoyed by both younger and female travel segments, to quasi-competitors such as online travel agencies (OTAs)."
To reach the connected traveler, Ferguson offers these imperatives to hotel marketers:
 
1. Provide digital services to franchisees. "Hoteliers [can] serve their franchisees with digital services, likely through a shared platform that operators can engage for local marketing and content, as well as by compiling into live profiles information learned on property about members."
 
2. Add utility to program currency. Ferguson envisions a world in which loyalty currency is more accessible via real-time earning and redemption, more flexible in its ability to be combined with other forms of payment, and more sharable by travelers with their families and networks.
 
3. Connect loyalty to the social graph. Hotels are good at social, Ferguson notes, but have not for the most part integrated social sites into the native environment of the loyalty program.
 
By enabling these three imperatives, Ferguson argues that hotels can begin to engage with the connected traveler throughout the travel journey, and create loyalty that allows them to shift away from margin-killing tactics such as members-only booking rates. it's a formula for success that more hoteliers would do well to consider.
 
Rick Ferguson is CEO and Editor in Chief of the Wise Marketer Group. Full disclosure: Allison and Rick are married, a relationship which in no way detracts from her article's essential brilliance.
 
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