There has been a 'substantial increase' in both spend and stay frequency from guests enrolled in the Stash Hotel Rewards loyalty programme for upscale and luxury independent hotels, according to a study published by the Cornell Hospitality Report.
The study, entitled 'Assessing the Benefits of Rewards programmes', was authored by hotel loyalty experts from Cornell University, Ithaca College and Michigan State University, and found that, after guests enrolled in Stash, they returned to a hotel nearly 50% more often and increased their annual spend by a similar amount. That shift translated into incremental annual per guest revenue of between US$405 and US$780.
The researchers compared guest behaviour at 24 hotels participating in Stash, with the hotels providing over two years of transactional data for more than 50,000 guests, both members and non-members. The team measured the change in spending after a guest enrolled in Stash, employing a methodology that controlled for self-selection bias - the tendency of a hotel's best guest to enrol in a loyalty programme. The researcher's rigorous statistical approach resulted in what is arguably the most thorough behavioural analysis of a loyalty programme ever published.
"Most hoteliers are convinced that loyalty programmes are important, but there's been little evidence of the value these programmes deliver," said Clay Voorhees, Professor of Marketing at Michigan State University and one the paper's authors. "But we now have that evidence. We observed significant changes in guest behaviour that could be directly attributed to the programme."