Unlocking Guest Loyalty with Smart Data Technology: A Hotelier’s Guide

As the hospitality industry continues to recover from the pandemic, guest loyalty has become an increasingly important topic among industry professionals today. Driving higher loyalty undeniably boosts a property’s bottom line; in fact, studies have found that generating a new customer was five to 25 times more expensive than retaining a current customer, and increasing customer retention rates by 5 percent increased profits from anywhere between 25 percent to 95 percent.

As hoteliers seek to recover revenue lost over the last two years, improving loyalty is more important than ever before-- but loyalty looks different in a post-pandemic world, and navigating new guest expectations adds another hurdle to improving a property’s loyalty program offerings. More often, hoteliers are turning to Smart Data technology in order to meet these new challenges, boosting profits and emerging ahead of their competitors. Read on to learn about how this cutting-edge solution can help reshape hotel loyalty to meet the needs of today’s guests.

Hotel loyalty today

Prior to the pandemic, the rise of millennials and gen Z consumers had already begun reshaping loyalty expectations. Younger consumers were found to spend more with their loyalty programs than their older counterparts, but boomers tended to be more satisfied with their loyalty programs than millennials and gen Z consumers. Personalization played a key role in this dissatisfaction; in one survey, 81 percent of consumers said that they’d be open to having various details of their activity and behavior watched, monitored and tracked in order to receive access to more personalized rewards or engagements, with the younger generations particularly open to this.

In the post-pandemic marketplace of tech-savvy, digitally-minded guests, the need for personalization is increasingly important to attract loyal consumers: one 2020 study found that if brands failed to offer a personalized experience, 45 percent of consumers said they would take their business elsewhere. While 85 percent of the businesses in the study believed they offered personalized experiences, only 60 percent of consumers agreed.

In addition to these changing consumer expectations, traditional loyalty hotel strategies were upended by the pandemic. Points-based programs, which were already less effective among younger consumers, were quickly abandoned by travelers, who were worried about their points expiring or losing membership statuses during the height of lockdown and travel restrictions. Now, guests want immediate lifestyle-based benefits like high-end dining, immersive cultural activities, retail purchases and access to exclusive events.

Meeting these needs requires hoteliers to have a firm understanding of who their guests are, how they behave and what they want, but this means achieving access to high-quality, reliable and trustworthy customer data-- and knowing how to use it.

Using guest data as a foundation

A strong data foundation is necessary to create personalized loyalty experiences. Traditionally, hoteliers have relied on internal CRM data to create personalized guest experiences and drive loyalty; however, in today’s tech-driven world, internal CRM data reveals only a fragment of the guest data available, and sifting through it to identify trends and create opportunities is a time-consuming process.

Smart Data technology plays a valuable role in personalizing guest experiences by using AI to capture data and help hoteliers identify the promotional opportunities that are more likely to retain guests. Using advanced analytics, this technology creates real-time guest profiles by compiling guest characteristics and demographics such as income, family status, age and interests across all digital touchpoints.

Accurate customer profiles are extremely vital for identifying which prospective guests are most likely to respond to specific marketing and/or promotional offers, which not only increases loyalty, but it also helps hoteliers boost their bottom line by identifying which market segments are most profitable.

Tailoring new loyalty offerings

When equipped with Smart Data, the opportunities to tailor loyalty experiences are endless. For example, hoteliers can use their Smart Data platforms to identify which guests visit the property restaurant on a frequent basis, allowing hoteliers to launch a hypersegmented marketing campaign to target these guests.

Leading Smart Data providers also utilize innovative marketing technology, equipping hoteliers with the ability to automatically deploy an effective and personalized cross-channel marketing strategy without the need to use a third-party advertisement platform. Hoteliers can launch promotional announcements, tailor their loyalty offerings and advertise events to the guests who are most likely to be interested in them. With the ability to target guests across multiple channels, automatically send surveys to identify potential weaknesses or gauge effectiveness and receive personalized reports on a custom-made dashboard, hoteliers can ensure the success of their loyalty campaigns and better personalize the guest experience.

Guest loyalty is changing, but modern Smart Data solutions make it increasingly easy to collect, interpret and use the vast amounts of guest data to deliver the personalized experiences guests now expect. Driving higher loyalty can be simple—but only if hoteliers harness the modern technology available.