The evolution of loyalty programs
Charting the future of customer engagement and retention through the travel, leisure, and hospitality industry
Brand loyalty is being tested. Customers are less satisfied with their brand experiences than they were just one year ago.1 Expectations are not being met in great part, they say, because technology, if not implemented correctly, can be an unwelcome intermediary to reduce expenses instead of to improve service. Customers complain about being funneled into low-cost channels stripped of human interaction and personal touch. And inflation still weighs on the customer mindset.
Loyalty programs can offer the personalized experience and savings customers want, as well as a high rate of return for companies that invest in these programs in the travel, leisure, and hospitality industry. However, the same strategies used in the past are not as enticing for customers who want and expect more.
Companies must evolve their strategies to meet changing consumer demands and business conditions.
A recent survey of loyalty members in the hotel and lodging space demonstrates the potential for companies in the travel, leisure, and hospitality sector to impact customer engagement.2
88% of satisfied premium loyalty program members prefer that business over a competitor offering a lower price
83% say joining a loyalty program will lead them to continue purchasing from that business
70% recommend brands to others if they believe the brands’ loyalty programs add value
66% modify spending to maximize loyalty benefits
Companies can build better loyalty programs by reviewing their existing offerings through the lenses of customer perception, providing a compelling offer, consistent delivery, and financial impact.
As GenAI capabilities mature, it will be easier for hotels, casinos, cruise lines, and others in the sector to collect and use real-time information about their customers’ behavior. One of the most significant challenges organizations face is figuring out how to fully maximize all of this data.
Review The evolution of loyalty programs to learn about transformational strategies that can drive value for both the customer and the organization.
Footnotes:
- “Artificial Intelligence and the orchestrated customer experience,” Global Customer Experience Excellence Study 2023-24, KPMG LLP
- KPMG consumer survey data and analysis
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