Phases and Staff Considerations for Implementing a Hotel Loyalty Program
The launch of a new hotel loyalty program requires a three-phased approach and a teamwide effort. Here you’ll learn more about the role each part of a hotel organization plays. We hope this will illuminate why stakeholders from across the organization need to be a part of each phase. Don’t put your hotel loyalty program at risk by skipping a phase or neglecting to include a vital part of the organization!
There are three main phases in the implementation of any new hospitality loyalty program:
- Phase 1: Strategy & Planning
- Phase 2: Implementation & Change Management
- Phase 3: On-Going Execution & Evolution
Each of the departments within a hotel management structure has a role in each of these phases. For simplicity, we’ll be using this breakdown:
- Management
- Front Desk
- Sales & Marketing
- Finance
- HR
- Ops, Logistics, & IT
- Food
Phase 1: Strategy & Planning Your Hotel Loyalty Program
This is the phase of the effort in which the major “what & why” questions are discussed and vetted: why now, why are we considering this at all, what are our goals and what does success look like? Getting a cross-functional team together to put all perspectives on the table can be a useful first step toward building hospitality loyalty programs. For teams that need the support of a facilitator for 1-on-1 or group discussions, agencies like Studio are here to help.
Management
- The buck stops here, so these stakeholders are the most important to have involved through every step of your strategy and planning process.
- Property, Brand, and Asset Managers all have different incentives so it’s important that strategy planning aligns with their goals.
- Asset Managers are responsible to the landlord and make decisions about your hotel’s flag, capital improvements, and revenue goals.
- Brand Managers work with flagged properties to ensure compliance with brand standards and property integrations with existing hotel customer loyalty systems.
- Property Managers lead hotel staff on-site, ensure staff training in best practices of guest engagement, and ensure guest satisfaction.
Front Desk
- For this team that is your face-to-the-customer, it’s likely they’ll have the best handle on what delights customers today and what could make for an even better guest experience in the future.
- Look to this team to understand what a happy customer looks and feels like and what that means for hotel customer loyalty.
- The team will also understand the operational hurdles and additional workload of executing a hotel customer loyalty plan from an hour-to-hour and day-to-day perspective.
- The front office team will also have a useful perspective on whether they have the (likely digital) tools, customer information, and other operational processes to execute a plan.
Sales & Marketing
- This team has the data and motivating sales quotas to help determine the right hotel loyalty program for the organization (and customer).
- Looking at the performance of sales and marketing efforts across customer, channel & ad types will provide an invaluable perspective about what can and should be on the hotel customer loyalty front.
- Often owning the digital properties on which this hotel loyalty program will be featured means that this group will also need to figure out what the right digital user experience would be.
Finance
- The rubber hits the road on the hotel customer loyalty front when it comes to determining the costs, benefits, customer lifetime value, and ROI of a hospitality loyalty program.
- Some basic modeling can help illustrate some of the key metrics that will need to be kept in mind to ensure an economically viable plan.
HR
- Customers are not loyal to brands, they are loyal to the feelings and emotions a brand expresses–and for experiential businesses like hospitality, this mainly comes from people-to-people interactions. In this way, no hotel loyalty program will be successful unless the human-to-human interactions are understood.
- Hotel HR teams will also bring the potential impact of union considerations into the mix and constraints or opportunities that exist there.
Ops, Logistics, & IT
- The type of hotel customer loyalty offering you’re considering will have implications for any ops and logistics teams as their help would be needed for all facilities needs you plan to offer up to members.
- IT teams and the customer-facing websites, apps, and other device-based software (e.g., in-room ordering or TV platforms) will need to be adapted to fit the needs of a hotel loyalty program. There may already be off-the-shelf software vendors in the mix and/or the need for custom software vendors.
Food
- What is a hotel experience without some consideration for food? There is no quicker way to a customer’s heart than (free or discounted) food. Or how about a bottle of a loyal customer’s favorite wine or tequila at check-in? Personalization and attention to detail are paramount to a successful hospitality loyalty program.
Phase 2: Implementation & Change Management
With strategy and planning efforts complete (the fun part), then comes the more difficult effort to put the strategy into action. It’s more than just setting an edict or sharing a strategy doc and hoping for the best, lots of thought and effort needs to go into the roll-out of a strategy effort to ensure all members of the team are aligned. Change management is about the soft stuff–helping staff feel included and supported through the launch of something new.
Management
- Ensuring a unified perspective and cohesive plan across Property, Brand, and Asset Manager leadership is vital. Delineating who is taking point on different aspects of implementation will help the rest of the organization rally around that vision.
Front Desk
- Any new hotel loyalty program will likely need some changes to the software front-office staff make use of on a daily basis, as well as the processes and procedures for making sure loyal customers feel rewarded.
- Initial and ongoing orientation and training for that new software is important, as well as updated training and expected process documentation.
Sales & Marketing
- Marketing has the important job of translating a hotel customer loyalty strategy into the brand and visual tone of voice of the company. They also have the difficult task of attracting new hospitality loyalty program customers with the right outbound marketing efforts. Having clear and time-bound goals for loyalty program adoption is a good first step.
- Sales teams are at the front-lines of group and VIP sales. Ensuring a sales team knows what the hospitality loyalty program means for any group purchases is important. It probably goes without saying that VIPs are prime targets for hospitality loyalty programs–they are already your most important customers and making them feel special is table stakes. Consider incentive programs and Q&A documentation to help the sales team hit their clear and time-bound goals.
Finance
- Measuring the effectiveness of a hospitality loyalty program likely falls to the Finance team. We’d challenge you to think beyond just the pure financials and dollars and cents of the program, but also capture qualitative feedback about how customers and staff “feel” about the program. Realize that initial investments are usually higher up-front and decrease over time.
HR
- HR is here to help ensure training, standard operating procedures and a clear division of labor is set up clearly and accurately.
- Consider a RACI (responsible, accountable, consulted, and informed) framework for setting hospitality loyalty program expectations across teams–name because not all activities will squarely fall onto a single person without the need to consult or inform other members of the team).
Ops, Logistics, & IT
- The physical properties’ role in hotel customer loyalty will likely require changes to amenity access, the role of the housekeeping staff, and other elements that keep the facilities humming.
- Many of the loose ends that get uncovered during implementation will become problems that an operations team needs to solve–they’re the folks who can be relied on to fix process gaps.
Food
- Dining and food services teams at many hotels often see the highest turnover within the organization. Because of this clear and concise training that is simple to follow will be paramount. Set expectations clearly so as to ensure that there is little room for interpretation or “playing jazz” in the execution of a hospitality loyalty program.
- Consider how food preferences are handled. What options exist to make sure Mr. Smith’s peanut allergy is known in advance or that he drinks tea and not coffee?
Phase 3: On-Going Execution & Evolution
Don’t expect perfection from the start. Big changes to hospitality loyalty programs can wreak havoc on customer relationships –see what happened here when Delta made some big (and unwelcome) changes. Aim for smaller refinements in the customer-facing parts of your hotel loyalty program and aim for bigger refinements in internal execution. In most cases, where there is a will, there is a way.
Management
- Property, Brand, and Asset Manager leadership will need to stay the course on their strong collaboration to ensure hotel customer loyalty evolves in lockstep.
Front Desk
- Seek ways to get first-hand data from front office staff about how customers feel about the hotel loyalty program. Consider making a few standard face-to-face questions part of the check-in progress. Let’s face it, surveys don’t have great response rates, so don’t miss opportunities to get data from the source while they are standing in front of your team.
- Seek feedback on the software supporting your front office team in their hospitality loyalty program execution.
Sales & Marketing
- Making use of surveys and other feedback mechanisms from your hospitality loyalty program members is important. Think broadly about where, when, and how feedback can be obtained. Ask for the good and the bad–customers will appreciate the desire for constant improvement and will generally provide constructive feedback.
- Consider updating hotel loyalty program sales and marketing goals on a quarterly basis and use grown metrics and rates as opposed to binary (yes or no) achievement or hitting a static metric–e.g., Grow hotel customer loyalty members in North America by 10% QoQ to X from Y in the previous quarter or Increase the average hotel customer loyalty member net promoter score in North America by 15% QoQ to X from Y in the previous quarter.
Finance
- Trying to keep an eye on the costs and revenue lift associated with the implementation of a hotel loyalty program will be important. Just ensure to not lose sight of the nuances of attribution and qualitative factors on both sides of that equation. For example, what if the most expensive cost line item is the biggest driver of loyalty and revenue lift?
- Help sales and marketing teams to set minimum thresholds and stretch goals.
HR
- Keeping a close eye on the internal impact on people of hotel loyalty programs is vitally important. Maintain close tabs on those whose workload increased with the launch of a hospitality loyalty program to ensure adequate staffing and void burnout.
- Leverage your teams at all levels of seniority to ensure they understand their ongoing role and the importance of the hospitality loyalty program. Consider extending your hotel loyalty program to all team members as a company perk so that they get to experience what it means firsthand when they’re traveling.
Ops, Logistics, & IT
- Helping to keep training, standard operating procedures, and processes transparent, easily accessible, and up-to-date with changes and evolutions is the name of the game for the ops team.
Food
- Ask this team explicitly for feedback on the execution of the hospitality loyalty program and what new ideas or trends they’re seeing that could be added or updated on the go-forward.
In summary, implementing a hotel loyalty program takes work and its success is predicated on teamwide involvement from the early stages through its evolution. Having a strong internal champion and strategy and implementation partner to shepherd the process along is also important. Technology considerations and implementation can make or break a hospitality loyalty program.
You can read more here about the various types of hotel loyalty programs and their features that might be right for you.
And for the IT and Marketing folks, you can read more here about the technology considerations (inclusive of third-party and custom solutions) for hotel loyalty program implementation.