Most Millennials (66%) say unique rewards are crucial when selecting a hotel loyalty program, according to a new Deloitte study titled, “Winning the Race for Guest Loyalty.”
When frequent travelers choose a favorite program, they aren’t the only ones who reap rewards, the study says.
There is a distinct difference between a hotel customer who has enrolled in a loyalty program and a customer who makes regular, truly loyal use of the brand because of it, the study says. For most customers, only one brand “wins”—and the prize is a dedicated relationship that enhances revenue in the long term. The journey past that behavioral tipping point is part science, part emotion.
To transform customers into enthusiastic, passionate brand advocates, companies need to understand the patterns in how different travelers view and use rewards.
Here are some key takeaways from the study:
- Two-thirds (66%) of Millennial high-frequency travelers rate “unique rewards” as an important factor when choosing a hotel loyalty program, compared with just 43% of their older counterparts.
- Three-quarters of Millennial respondents also indicate they would remain loyal to a hotel brand even if they lost all their points and status, compared with 66% among other travelers. What’s more, the types of program benefits Millennial travelers expect are no longer solely points-focused.
- Overall, 68% of frequent travelers indicate they consider themselves loyal to the program where they have accumulated the most points. Millennials, however, highly value “soft” benefits such as VIP treatments and exclusive experiences more than other groups.
- Two-thirds (66%) of Millennials indicate unique experiences matter, compared with 50% of frequent travelers in other age groups. The study revealed that once customers establish allegiance to one brand loyalty program, they will go out of their way to patronize that brand, and Millennials are most likely to do so.
- Millennials indicate they would pay $41 more per night and travel up to 15 minutes out of their way to stay with their preferred brand, compared with business travelers in other age groups, who are willing to pay an extra $29. This behavior spills into leisure travel, where Millennial travelers would pay up to $35 more per night to stay with their chosen brand, compared with $20 among non-Millennials.
“The race is on for brands to provide swift gratification, particularly for the savvy Millennial travelers, who are quick to share their positive experiences or broadcast their discontent over their social networks, and who are acutely aware of the rewards that come to loyal customers,” Guy Langford, vice chairman, Deloitte LLP and U.S. Travel, Hospitality and Leisure practice leader, said in a release. “The brand that locks in the customer’s loyalty first and wins that race is the brand that wins that customer, and potentially their loyalty, for life.”
The survey was commissioned by Deloitte and conducted online by an independent research organization over an eight-week period in early 2014. The survey polled 3,001 high-frequency U.S. travelers, defined as individuals who spent more than 25 nights in a hotel in 12 months prior to taking the survey.