US: La Quinta relaunches loyalty program

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By: RickFerguson |

Posted on December 19, 2016

Hotel loyalty programs have long followed a familiar playbook: points earned toward free hotel stays accompanied by tiered soft benefits, which together provide a powerful value proposition that drives incremental behavior, increases hotel revenues, and cements long-term loyalty. While these programs have long worked to drive profitable customer behavior, the relative parity of hotel loyalty programs has seen innovation slow. Enter La Quinta Inns & Suites, which plans to relaunch their program as a liquid currency that will keep the La Quinta Returns program top of mind with their best customers.

By Rick Ferguson
Skift has the story, which reveals that the new program, called "Redeem Away!" will allow members to link their Visa card and mobile number to their loyalty acount and then redeem points for everyday purchases by responding affirmatively to a mobile text asking if the member would like to redeem at the point of sale. Purchases must be qualified, but the Visa platform allows redemption at more than a million retailers including the dining, grocer, pharmacy, and specialty retail categories. Money quote from CEO Keith Cline:
"Today, consumers have told us loud and clear: 'We don't just want to work toward a free night. We want points to work immediately and have value today. This type of program keeps the La Quinta brand top of mind; you're interacting with it every day. That's what drives repeat business at the hotels."
The La Quinta program is small, but mighty: 11 million members with over 3 million active, and nearly 50 percent of revenue flowing through the program. About 80 percent of members also book direct - a critical component of loyalty in the battle against rival online travel agencies (OTAs) and their discount-based bookings. Cline tells Skift that the upcoming relaunch will see substantial changes to the program, including "member benefits, tiers, and the ways in which members can earn points."
Liquid currency, meanwhile, will continue to be one of the predominant loyalty trends of the coming year, particularly in high-parity environments with rival brands hording massive amounts of points liability on their books. In a LinkedIn post, Maritz Motivation Solutions VP Barry Kirk sees the importance of this growing trend:
"Keep an eye on La Quinta -- their impending loyalty program relaunch includes perhaps the most expansive 'liquid currency' offering in the loyalty space today, certainly one of the most innovative we have seen in the hospitality vertical. Using points for every day spend is a growing trend. What we'll need to keep an eye on is the impact this type of redemption might have on long-term loyalty."*
That's the rub, all right: if members redeem points for fast food and gasoline, those redemptions might certainly help drive credit card choice, which will help Visa. With fewer points to redeem for free stays, however, could the program actually result in lower brand engagement with La Quinta? Liquid currency is actually a more fitting choice for a budget hotel brand like La Quinta, whose loyal members are largely Interstate highway-hugging road warriors who will enjoy the flexibility provided by liquid currency. For those members who would like to redeem for leisure stays, La Quinta has also partnered with 20,000 luxury hotels on the redemption side. The wide range of redemption options allows members to self-select into marketable segments.
For an upscale brand like a Marriott or Hilton, however, loyalty is driven as much by the hotel experience as it is by the ability to earn points. Would liquid currency, in which hard-earned points are converted into actual cash value at the poin-of-sale, actually reduce the perceived value of points that could once only be used for hotel redemptions? As liquid currency becomes a more common program benefit in the industry, this question will bear watching. In the meantime, kudos to La Quinta for going the extra mile for their best customers.
Rick Ferguson is CEO and Editor in Chief of the Wise Marketer Group.

*Full disclosure: Maritz Motivation Solutions is a sponsor of the Wise Marketer Group.