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Hotel Loyalty is About the Experience, Not the Points

The allure of travel is in the experiences you have, the memories you make, and the stories you tell. It’s certainly not in the points you earn from your airline or hotel.

That’s because loyalty points are a commodity. Consumers collect them simply as a way to get more free stuff or discounts; there’s no real sense of emotional attachment or connection to the brand involved. On average, a consumer belongs to 14 loyalty programs, but he or she only stays actively engaged in half of them, according to a 2017 Bond Brand Loyalty report.

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Consumers are suffering from “points fatigue,” and perhaps nowhere is this more apparent than in the travel and hospitality industries. I spoke with Christopher Hartley, CEO of Global Hotel Alliance (GHA), on the Outside In podcast, and he described how airline miles in particular have become a “commodity currency”; you can earn them anywhere and spend them on pretty much anything. Hotels have generally followed the lead of airlines when it comes to their own loyalty programs, but in an industry that’s seeing massive disruption, points and rewards are not enough to build true loyalty with today’s travelers.

With 35 (and counting) independent luxury hotel brands in its global portfolio – like Omni, Kempinski, and Anantara – GHA unites them and uses common technology platforms to compete against mega-chains like Hilton, Marriott, and Hyatt. When GHA set out to design its loyalty program in 2010, the company partnered with guests and travelers to learn different perspectives on what a loyalty program could be.

“It soon became clear, as we brought consumers around the world into co-creation sessions that they actually didn’t want another points program,” Hartley explains. “They were exhausted with the number of points systems that were out there…the idea of another points program simply wasn’t appealing. We weren’t really going to make a difference if we did that.”

Travelers overwhelmingly expressed that what they really valued was a sense of recognition and discovery. They wanted to feel connected to their new location and do things they’ve never done before and couldn’t do anywhere else. These insights coalesced into an idea for a different kind of loyalty program: local experiences as loyalty rewards. That’s how GHA’s DISCOVERY loyalty program was born – promising loyal guests unique and authentic local experiences when they stay at any one of GHA’s 550 properties around the world. Today, DISCOVERY has more than 10 million members.

The most loyal guests are rewarded with one-of-a-kind, bucket list-worthy experiences, like touring the Large Hadron Collider in Geneva or driving around Berlin in Trabants (or, “Trabbies”) from the East German era. “These are the sorts of things that remain in people’s minds forever. They’re the stories that you tell your children, your friends, your grandchildren. Those are the stories that create brands.”

DISCOVERY was launched years before the hospitality industry – or anyone else – was talking about how consumers value and want to share experiences. In many ways it was a revolutionary idea, today so successful that other travel brands have introduced similar programs. “More and more we’re seeing brands copy the idea that the consumers inspired,” Hartley says. “[Consumers] were the ones who disrupted this whole points system and said, ‘No, we don’t want points, we want experiences.’”

GHA continues to distinguish its brand and grow its customer base by inspiring guests to be brand ambassadors, or storytellers. “We believe that a lot of our success today and in the future will be about people telling stories about what they’ve discovered around the world,” says Hartley. “We’re able to offer a brand experience that consumers can talk about between themselves. And that in itself is helping us to build awareness for these brands and demand for what is a very different experience from what the big brands offer.”

It’s a valuable lesson for any company in any industry: loyalty is not created by copying the competition. It’s earned through listening to customers, and trusting in their creative and disruptive nature to guide the design of products and experiences that actually do keep them coming back.

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