Incentives that’ll make hotels stand out as living costs increase

According to the Office for National Statistics (ONS) , around two-thirds (65%) of adults in Great Britain are spending less on non-essentials. With this, it’s unsurprising that globally, 43% of consumers are planning to reduce their spending on travel.

Due to the competitive landscape, hotels need to ensure they are actively reviewing their customer retention and acquisition strategies to stand out from competitors. The cost and time pressures of acquiring new customers makes retention strategies of particular importance.

According to Mews Hospitality, total customer acquisition costs generally make up 15-20% of overall room revenue. They are divided into commissions paid to third parties, reservation transaction fees, loyalty programmes, and other funds used to attract clients to stay at your hotel. So, how can hotel businesses ensure that they are retaining their most loyal customers?

Nurture your loyal customer base

Sales and discounts are commonly used as successful initiatives to retain customers. According to Tripadvisor’s Seasonal Travel Index, cost and affordability (71%) is the most important factor to Brits when holiday planning.

Whilst many businesses cannot permanently reduce their prices, they can hold special sales on certain occasions which can entice customers to come back or make the brand the first choice above competitors. During hotel bookings, if yours is the most cost effective, you’re likely to have a greater chance of winning new customers.

Loyalty programmes are an effective way to entice returning customers. A survey conducted by Software Advice found that more than four out of every five consumers they surveyed (81%) currently use a loyalty programme. The idea of earning something after returning multiple times is a great way to encourage customers to continue staying with you. Offering a room upgrade, or a day of free meals, maybe even free access to the spa after a certain number of visits, will certainly help to differentiate your service offering. Whilst consumers are cutting back on extra spending, these extra treats are likely to be hugely appreciated, now, more than ever.

Tactics to win new customers

Giveaways and competitions are an excellent way of earning new customers. Creating more brand recognition is an effective word of mouth marketing tactic. Launching new customer incentives on social media platforms can present the opportunity for your brand to reach new audiences, grow your followers and boost your engagement.

In addition, if guests have an amazing experience, they’re likely to return, and tell friends and family about their stay at your hotel. Alternatively, offering a gift card or voucher for an experience, allows customers the freedom to choose what to spend their reward on and enables them to create lasting memories. This is appealing to customers, especially when many are cutting down on unnecessary spend, as it provides them with a little extra to treat themselves to something they may not have been able to justify or stretch to.

To go that extra step in showing customers they are valued, business leaders should take time to understand their target customer. This will then allow them to segment, and then tailor their offerings to ensure it provides genuine value, making it that much more appealing to the customer. For example, an experience voucher would be great for the parents who value spending time with their family on a weekend off. Using this would be a treat for the whole family. 

To conclude, in these times of reduced travel, customers need a good reason put in front of them to persuade them to stay loyal to your brand. Go the extra mile making their stay truly exceptional and offer them something to ensure you stand out amongst the crowd.