Adding Value to Hotel Loyalty Programs for both Guest and Hotel

Abstract

Loyalty programs are widely used in the tourism and hospitality industry, indeed instances where airlines, hire-car agencies and hotels are not part of a program are rare. Loyalty Programs not only encourage and reward customer loyalty but allow a company to learn specific details about an individual’s patterns and behaviour. However while these programs are widely utilised little has been written about them in tourism and hospitality marketing literature. This study has three purposes, to analysis the Scandinavian hotel loyalty program marketplace, to analysis member/non-member behaviour and attitudes and to draw conclusions as to what will make loyalty programs more valuable to both the member and hotel. Empirical data was collected from international hotel chains within Scandinavia, from members of the RicaCard loyalty program and from a survey of the general population of Gothenburg, Sweden. The main results indicated that little differentiation existed in terms of design and to a lesser extent range of rewards within the marketplace and that guests where often members of several programs. The conclusions suggested that by giving members more opportunity to invest in a program, especially early on they may become more committed to one program and therefore become loyal to a hotel chain.