One of the many impacts of COVID-19 on the hotel and hospitality sector is yet to play out in full: how will the virus affect customer loyalty? Consumer behaviors have been massively disrupted and, with an extended period away from travel, old habits and loyalties may have faded.
As travel begins to return, competition will be intense. The winners will be those who make bold moves to bring back old customers and win the loyalty of new ones. But customers’ expectations and priorities are evolving. Competing for customers by reverting to the old ways of doing things simply won’t work.
It’s time for a comprehensive review of loyalty strategies, focusing on the areas we call the “soul,” “mind” and “body:” respectively, the experience model, the data model, and the business model.
SOUL: THE EXPERIENCE MODEL
The soul is the system that connects people, things, and environments to shape unique, personalized interactions with the brand. For hotels and hospitality, that means moving from loyalty programs that offer purely functional benefits related to travel, such as hotel discounts and room upgrades, to engaging with customers in other areas of their lives. Consider how Accor restyled its loyalty program in 2019 as Accor Live Limitless: “A lifestyle loyalty program that goes beyond hotels and offers.” Scheme members can access unique experiences, be it watching Paris St Germain’s soccer superstars from a VIP box, sharpening up their cooking skills with a top chef’s masterclass, or dancing the night away with the latest must-see band at the Accor Arena.
The new experience model demands a completely customer-centric approach that responds to today’s changing expectations. As Accenture’s Life Reimagined study reveals, consumers’ new priorities include health and safety, of course—but also service and personal care, and ease and convenience. Here, in particular, the travel industry has everything to play for.
Technology will have a big role. Look at Marriott’s Bonvoy app. Guests can check in before arriving and receive mobile alerts when their rooms are ready. A mobile key provides touch-free access to the room, carpark, or pool.
Across the sector, mobile-enabled services help deliver the end-to-end convenience that customers expect—and the contactless interactions that will be particularly valued as long as COVID-19 remains a threat.
MIND: THE DATA MODEL
The mind is about data: sourcing, integrating, and analyzing data to deliver seamless and personalized customer journeys, and staying relevant to customers in their lives beyond the hotel stay. Cloud technology can provide the capacity to gather and manage data, across the organization as well as externally, enabling seamless integration with ecosystem partners.
Ultimately, the aim for “mind” is to develop a new level of insight that enables deeper and more personalized connections with customers. One compelling approach is found at Virgin Hotels, which defines personalization as giving its employees the tools and empowerment to meet client expectations, whatever form they take, from quirky one-offs such as comic-book-themed room takeovers, to simpler gestures, such as free room upgrades.
With deeper data insights accessible in real time, hotel staff might, for example, see a negative customer review and could act to make amends, perhaps with a complimentary meal. The vision should be to give customer-facing staff access to relevant customer data, and empower them to make decisions in real time to create unforgettable experiences—and, in the process, build long-term loyalty.
BODY: THE BUSINESS MODEL
The third dimension of loyalty is about operational excellence. We believe hospitality needs to develop new approaches that make loyalty integral to the business model, supporting business strategy and objectives. This requires the reformulation of customer-relationship management; multi-channel experiences; and propositions that drive value in new dimensions of a traveler’s life.
One way to tap into other dimensions of a customer’s life is through work-related offers, riding the trend for home-based working—but also recognizing its limits. After all, home isn’t always the best place to work. Some brands have offered customers high-quality workspaces, rented on a daily basis, with essential facilities such as fast, reliable internet. That offers customers chance to escape the distractions of home for a critical presentation or key meeting, say—and increases the hotel’s relevance to customers even when they aren’t traveling. Memberships for gym and pool use are other examples of alternative revenue streams for hotel brands.
Hotels need to continue to experiment and innovate in their business models in order to stay relevant, adapting at pace with customers’ needs.
Winning customer loyalty for the future demands a fresh approach right across the experience, data, and business models. Hotels and hospitality will be competing intensely to keep existing customers and win new ones. In the fight for customer loyalty, “soul,” “mind,”’ and “body” are the new battlegrounds.
About the authors
As the Global Travel Industry Sector Lead for Accenture, Emily Weiss is responsible for driving the growth of Accenture's Travel business across Hospitality, Aviation, and Travel Services through the delivery of transformational industry solutions.