The struggle for loyalty

“We have seen a great increase in the demand for redemption room nights and, since we have also reduced the number of points required in the top three highest categories, this is also showing an increase in demand. We have introduced a Points & Cash alternative for members who want to go away but do not have enough points. Mixing the two means that the opportunity for a room night is within reach of more members. At the hotel front desk, we have also extended the range of instant Express Awards, so that members can use their points quicker at lower levels for a range of services from Pay TV to room upgrades and dining 2 for 1”.What results for Loyalty Program strategy?We are currently witnessing a veritable trench war… Perhaps we should see it as a diverted effect of the crisis, but relations between hotel groups became tense around a sensitive target: their most loyal clients. Hilton’s announcement that it would revise its loyalty points scale resulting in a 20% devaluation of this precious cash sparked things off. Not that such as practice was rare. Written in black and white in the general conditions of all programs, hotel groups regularly put this tactic to use to adapt their rewards to hotels’ activity levels and the program’s very expensive imperatives.Indeed, at the beginning of the year, Starwood and Marriott also modified their scales without any consequences. And Hilton highlights the fact that it had not revised its system in six years. “Most of our competitors had long since increased the level of points and it is necessary, for any program whatsoever, to periodically adjust the scale. We notified our members well in advance, offering a free night to some of our best members,” defends Jeff Diskin, Senior VP...