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11/02/2016

Hotel Guests First Seek Information on Loyalty Programs from Websites, Employees

In this two part series, Natasa Christodoulidou, Ph.D., Director of the Hospitality Technology Research Institute (HTRI) and Associate Professor in the Department of Management and Marketing, College of Business Administration and Public Policy at the California State University Dominguez Hills, discusses the methodology and some of the results of a study that examine how hotels' communication preferences regarding their loyalty programs could be affecting the way guests perceive and use such programs.

Dr. Christodoulidou co-authored this article with Orie Berezan at California State University.
 
The first part of this series detailing the purpose of the study, the targeted sample and the subjects, and part of the results, can be found here: http://bit.ly/2ejag4F
 
Below is the remainder of the results.

RESULTS (Part 2 of 2)
The company website was deemed to be the most interactive and friendly channel, with social media perceived as the least interactive and friendly. The participants in this survey prefer interacting through the company website as this is a tool they may have gotten used to over time due to ease of use. Furthermore, company websites provide a variety of interactive options such as member account information, official program information, award availability, and direct links to online reviews (social media).
 
Social media, however, does not score as high in interaction and friendliness in loyalty programs compared to other channels. This means that any communication that is driven to the audience through the loyalty program’s website is considered more interactive and friendly than the rest of the communication channels. This is a surprising result considering that social media is largely a communication channel produced by the customer for the customer. This may be attributed to the age distribution dynamic of the participants, as they tend to be a more mature audience that may find social media channels to be a non-personal, non-friendly communication avenue for their needs and preferences. A younger sample may produce different results in this situation.
 
Communication channels influence all five dimensions of information quality (trustworthy, clear, useful, timely, and thorough). Perhaps due to the financial and human resources devoted to website management and updates, company website information quality meets the preferences of most consumers. This is well aligned with the better value theory in which quality of information and service quality are two highly sought attributes by customers when selecting their preferred channel of communication. Social media is also considered trustworthy, likely because the information is provided by fellow customers and without a business purpose.  Program website was perceived to provide the clearest information, followed by company employees.
 
The timeliness of information provided through social media is rated lower than personal word-of-mouth and program website. This may be attributed to the older demographic participants of the survey. Since social media outlets are still relatively new to more mature participants, they may not check Facebook or Twitter frequently and thus perceive the information posted as not current or updated.
 
The results of this study suggest that social media is not as prominent as other communication channels in impacting perceived information quality and style. In fact, the most impactful channels were company-created channels ? i.e. program website and employees. For management, this means that the customer first seeks information through channels in which the company has ownership and control of the content rather than outside influencers such as social media and personal word-of-mouth. This can be a very powerful tool for organizations, since they now know that the customer trusts the information posted on the website more than any other channel disseminating information.
 
The results suggest that resources need to be devoted to the company website since this dimension scored the highest in every variable of information quality and communication style. The findings also showed us that more resources need to be devoted to social media if the organization wants to utilize this particular channel for disseminating information. Currently, loyalty members do not feel that is easy to use nor that it offers better value than the other channels of delivering information such as the website, employees, or word-of-mouth.
 
Executives should use these research findings as a guide to how they should structure and maintain relationships with their loyalty members. These results could be used by top-level executives involved in marketing loyalty relationship building as they research and test how to best craft their relationship with their members through the various communication channels. Given the relative newness of social media, executives have the opportunity to enjoy the upper hand of directing and managing this delicate relationship.
 
Based on the current events, it is evident that the loyalty communication landscape is in a state of flux. While company websites have earned traction for ease of use and better value both in terms of information quality and communication style, the other communication channels such as, for example, social media outlets should not be ignored; they will likely be the fastest catalyst and best ambassador for instant communication information dissemination in the future. All of the major players in communication channels such as the website, the employees, word-of-mouth, and social media will always be jockeying for the first position.