Are Hotel Loyalty Programs in Trouble?

A major hospitality labor group, Unite Here, is calling for an investigation into hotel loyalty programs, raising concerns about transparency and customer satisfaction. This call to action has sparked conversations about whether hotel loyalty programs are as rewarding as they seem—or if customers are being misled.?

As loyalty programs have become more common, customers have come to expect clear rewards for their loyalty. However, some believe that the value of these programs is eroding.??

Recently, Unite Here raised red flags about how some hotel brands are managing their loyalty offerings, prompting a closer look at whether customers are truly benefiting. This has opened up a larger debate about the future of loyalty programs and whether hotels are delivering on the promises they’ve made to their most loyal guests.?

With high-profile brands like Hilton, Hyatt, and Marriott named in the discussions, it’s clear that this issue isn’t limited to small chains. What is causing this shift in perception of loyalty programs? Could it be related to the hotel industry’s operational changes post-pandemic, or is there something deeper happening behind the scenes??

Why Are Hotel Loyalty Programs Facing Criticism??

According to Unite Here, there are a few main reasons why hotel loyalty programs are under fire:?

• Devalued rewards: Customers are finding that the points they earn are worth less than before. For example, what used to get them a free night might now only cover part of the cost.?

• Hidden and confusing pricing: The group claims that it’s becoming harder for customers to understand the value of their loyalty points, making it difficult to compare different programs.?

• Extra fees: Some hotel loyalty programs are charging extra fees to redeem, maintain, or transfer points, which adds frustration for customers.?

• Less competition and fewer choices: As loyalty programs merge, customers have fewer options, which could mean fewer benefits and less competitive offers.?

The combination of these issues has led to a growing sense of dissatisfaction among loyalty members, especially those who expect certain perks from elite status, like room upgrades or free breakfasts. With fewer staff and services being offered, these benefits are also disappearing, leaving loyal customers frustrated.?

What Can Brands Do to Improve Their Loyalty Programs??

Hotel brands must take action to rebuild trust and improve the effectiveness of their loyalty programs. Here are a few ways they can fix the problems and keep their customers happy:?

1. Be Transparent?

Hotels should clearly explain how their loyalty programs work, including point values, fees, and pricing structures. This will help customers make better choices and feel more confident in the program.?

2. Keep Rewards Valuable?

Loyalty programs should consistently offer good value for the points customers earn. Devaluing rewards will only drive customers away. Keeping points worth the same over time will help maintain customer loyalty.?

3. Restore Services?

Hotels need to bring back the services that customers expect, like daily housekeeping and dining options. This is especially important for elite members who count on these perks when choosing where to stay.?

4. Make Redemption Easy?

Simplifying the process for redeeming points is key. If it’s too complicated or involves too many fees, customers won’t bother using their points, which defeats the purpose of the loyalty program.?

5. Focus on Customer Experience?

Brands should look at improving the overall experience for loyalty members. Personalized offers, mobile-friendly apps, and easy-to-use technology can help improve customer engagement and satisfaction.?

Can Hotel Loyalty Programs Bounce Back??

Hotel loyalty programs are facing a tough challenge. If customers continue to feel like they’re not getting enough value, they may stop participating altogether. However, if hotel brands take the necessary steps to fix these issues—like being more transparent, keeping rewards valuable, and improving customer service—there’s still hope.?

At the end of the day, hotel loyalty programs can be a powerful tool to keep customers coming back, but only if they deliver real value. If hotels want to maintain customer loyalty, they need to listen to their members, adapt to their needs, and focus on providing a great experience that makes them feel appreciated. Loyalty should always be a win-win for both the brand and the customer.?

About the Author:

Abhinav Jain (AJ) I Almonds Ai is the co-founder of Almonds AI, a passionate advocate of innovation and lifelong learning. With a zeal for knowledge and an enthusiastic appetite for reading, Abhinav is dedicated to the pursuit of wisdom and the relentless quest for new ideas and insights in the ever-evolving world of technology and artificial intelligence.

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