Customer Loyalty: How Can the Travel Industry Retain Business in an Increasingly Fickle Environment?
The pandemic has put trust and confidence to its ultimate test and, while customers are hungry for travel experiences again, they are not simply returning to the traditional ways of doing things. Travel brands need to prioritize loyalty strategies if they are to gain and retain business in this unfamiliar environment.
This means using all tools at our disposal to build deeper relationships with customers and encourage them to keep coming back to us repeatedly – something not easily achieved in an online era of unprecedented customer choice.
What Are Customers Looking For?
We know that the landscape has changed post-COVID, but what are our customers actually looking for from the travel companies they choose to do business with?
Thanks to the internet, they have more choices than ever before, so brands need to do more to stand out. Gone are the days when loyalty could be expected simply due to a lack of options – so brands need to offer real and tangible benefits to customers in exchange for their repeat business.
Recent research by Accenture discovered that a paltry 18% of loyalty scheme members actually engage with those programs in any meaningful manner. When pressed for more information, only 22% of members said they were happy with the level of personalization they were presented with, and 29% said they wanted the offers to be more interesting.
Take arguably the most common loyalty program type – the accumulation of points which can then be used to access rewards once certain thresholds are met. 70% of customers report abandoning loyalty programs because it takes too long to accumulate enough points to unlock anything meaningful or valuable.
In related research, over three quarters [78%] of hotel guests have stated they would prefer to receive immediate benefits rather than have to accumulate points in this manner.
Conventional wisdom and experience may have you asking – “Sure, I bet they’d prefer to receive the benefits now, but how does that incentivise them to return for repeat business later?”
It’s a good question, and the answer is actually rather simple. Customers remember and are more likely to return to a brand they feel treated fairly in the past. Ask yourself if you would feel more fondly towards someone who rewarded you now or someone who kept you hostage, over a prolonged period with promises of a reward at a later date?
Measuring Success
There is little point in implementing a loyalty program if you have no metric by which to measure its success. Thankfully, there are numerous ways you can objectively measure the success of your loyalty program using the vast volumes of data generated through eCommerce activity.
For example:
- Running A/B tests between members and non-members to discover whether your program is having an impact on your retention rate
- Measuring negative churn can tell you how many customers are upgrading or purchasing additional services as a result of loyalty program offers
- Net promotor scores can help measure customer satisfaction
- Customer effort scores tell you how much effort a customer has to personally invest to solve problems with your company
- Social media mentions can let you in on what customers are saying about you online
This list is by no means exhaustive. Indeed, there are plenty of other metrics, such as referral traffic and purchase habits, which can also help you evaluate the effectiveness of your loyalty schemes.
Image Source: https://digitaltravelapac.wbresearch.com/downloads/digital-travel-apac-2022-innovation-brief?-ty-m
Crafting a Loyalty Program for 2022
When creating a modern loyalty program for your brand, there are several factors you need to consider. Failing to prepare properly at this stage can mean the difference between building deep long-lasting relationships with customers or losing them to competitors.
First, you need to make sure you fully understand your customer base. Look at existing customers – or pre-pandemic ones – and try to identify common traits such as age, socioeconomic status, the kinds of trips they tend to book, etc. Understanding your customers is key to creating a program which will best resonate with them.
Creating a community around your brand is a fantastic way to inspire trust and loyalty in customers. Engaging on private forums can allow you and your customers to share travel advice, and you can also offer special members-only deals and other content. This is a perfect way to implement a strategy built around instant gratification rewards – by offering them through a member’s program rather than locking them behind a convoluted points scheme. Similarly, engaging with customers on social media is a terrific way to foster trust and transparency with your brand and inspire confidence among your audience.
"Our loyalty program serves as a love letter to our customers, who we affectionately refer to as our #LBCommunity."
Vanessa Yeo Barger VP of Brand at Love, Bonito
“Listening and responding to our customer’s needs to become part of our community and enjoy engaging content and perks is what Love, Bonito believes in and we are thrilled with the ability to adapt the program to the changing and growing expectations of our customers.”
Today’s customer, regardless of industry, wants to feel brands understand them and are willing to go the extra mile to offer them personalized promotions and other communications. Something as simple as using the customer’s real name on an email can go a long way towards achieving this – especially if it’s backed up with relevant offers and promotions.
Checking in with customers right after a trip is another fantastic method of connecting with them and showing you care about their experience long after money has changed hands. This is also an amazing opportunity to start tantalizing their imaginations regarding their next vacation and incentivizing repeat bookings.