Restaurants and hotels say that improving guest loyalty has been a top priority in 2017. How can technology help and what are the latest trends? What do hoteliers need to take on board to manage their properties in an increasingly connected world? Donald Gasper takes a look.

In the area of management, restaurants and hotels agree that improving customer loyalty has been a top priority in 2017.  More than half of restaurants (61per cent) and hotels (52 61per cent) put improving digital customer engagement and loyalty as the number one strategic goal for technology rollouts according to the survey 2017 Restaurant and Lodging Technology Studies. Operators from both restaurants and hotels are ready to invest in technology that will help them achieve this. According to research published by Hospitality Technology magazine, 58 61per cent of restaurants and 37 61per cent of hotels will be adding, upgrading or making changes to CRM/loyalty software.

Loyalty – a Big Opportunity

Meanwhile, Oracle Hospitality recently conducted a global consumer survey. Though it was mainly targeted at customers of restaurants, coffee shops and other food and beverage outlets, the findings of the survey, titled Recipe for Engagement: Essential Ingredients for a Restaurant Loyalty Program, are also of relevance to others in the hospitality industry, hotel operators in particular, who run loyalty programmes or are considering doing so.

The survey considers the reasons why restaurant operators need a loyalty programme, and what guests expect from them.

“A loyalty programme can deliver a number of important benefits to restaurants,” says the survey report, which carries the sub-title “Loyalty – a Big Opportunity for Restaurant Operators”.  A loyalty programme provides restaurant operators with a way to reward customers and encourage repeat business, the survey concludes. It is also an effective, measurable marketing tool – by gathering details about the guests, such as their e-mail addresses and locations or date of birth, operators can target them with promotions to help grow the revenue of the hospitality outlet.

“Winning repeat business remains an important goal for any restaurant loyalty programme, but the true value lies in using it to gain an understanding of a restaurant operator’s customers and then leveraging that insight to create revenue opportunities and deliver the [kind of …] service that guests increasingly want. Without a loyalty programme capable of delivering insights, operators risk falling behind the curve.”

However, today’s millennial generation is looking for more than e-mail promotions. They want frictionless, personalised service. A loyalty programme provides a framework for restaurant operators to meet their needs. It helps restaurant operators offer recognition and rewards, but, most importantly, it allows restaurant operators to gather demographic data and transaction histories so that they can tailor the guest experience in real time.

A different level of recognition

One example of such a programme is that used at Hong Kong’s Hotel ICON.

“From the idea that search, planning and discovery are NOT the hassles before the experience, but are integral to the experience, I implemented ‘Icon Engage’,” says Richard Hatter, the hotel’s GM, describing the scheme as the interplay between tech and highly trained humans.

“We communicate bespoke rewards and pricing for ‘book direct’,” he explains. “It’s integrated with revenue-management technology, enabling GRO and Revenue/Marketing teams to strategise and target travellers with personalised messaging and personalised experiences – providing value from interacting with the hotel directly, increasing their engagement and loyalty.”

Travellers want real rewards for their loyalty; gimmicks and unusable points will only breed resentment and disloyalty, Hatter says.

There is too much focus on emerging data channels, which are spread too thinly, and as a result none of them works well. Brands should focus on the most strategic data channels and overdeliver, making sure adequate resources are applied.

ICON focuses on flexibility and seamlessness via mobile: Why should someone need to go through their assistant or a corporate travel office to change a flight or hotel booking? Messenger-based communication with travellers allows for seamless changes that make their stay easier. It’s mobile and empowers the traveller.

“Members of our Above and Beyond loyalty programme and suite guests plus super travellers don’t want an ‘elite line’ for check-in,” says the Hotel ICON GM. “They want to bypass the line and be escorted to a room, with any formalities handled there.”

Hatter says he is inspired by the idea of tech-enabled omotenashi (the traditional Japanese way of treating a guest): “Obviously the Japanese elevate this to a high art. At ICON we use modern technology to enable and empower staff for a new level of service.”

Speaking of traditional Japanese hospitality, Japan’s Okura Nikko Hotel group is another example of a successful loyalty programme. It has a scheme called ‘One Harmony’. Since it was established in 2013, 1.35 million members have joined, including 500 thousand members based overseas. “Over 20% of all members used our hotels in the past year, confirming the high level of activity of the loyalty programme,” says Ryutaro Suzuki, Marketing Director of the hotel management group. “’One Harmony’ is steadily growing adding more than 20 thousand new members every month.”  The programme aims to have 3 million members by 2020.