Hotel points programs have become a key component of the business travel ecosystem
Compelling loyalty offerings have the power to influence decisions made by both travel managers and the travelers themselves. In fact, most industry surveys show travelers rank hotel loyalty programs as highly important.
Business travelers want to be appreciated and recognized for their loyalty, according to John Wolf, VP of loyalty, digital and marketing innovation PR, global communications and public affairs for Marriott International. Hotel loyalty programs are what provide that reward for those who are required to travel on business.
“In conversations with some of our largest B2B customers, they shared the perks and value of their travel program is one of the factors people consider when choosing them as an employer,” Wolf says. “We believe hotel loyalty programs play a big role in this.”
Customized loyalty offers and additional perks have become expected by travelers, notes Geoff Waldmiller, VP performance optimization for RoomIt by CWT. Recent research reveals 59 percent of business travelers in managed travel programs wouldn’t even consider booking an accommodation where they couldn’t earn hotel loyalty points, making loyalty offerings table stakes for business travelers today.
“The inability to earn loyalty points may cause traveler dissatisfaction and lead to out-of-policy bookings,” Waldmiller says. “Seventy-one percent of travelers agree that if they give up their time to travel, they should have the ability to earn loyalty points.” That’s why playing the hotel loyalty points game right can score stronger program compliance and boost traveler satisfaction.
Heather Balsley, senior VP, global loyalty and partnerships for InterContinental Hotels Group, says business travelers are seeking a proposition that enhances their stay experience and allows them to earn rich rewards for future leisure travel. In fact, according to a survey from IHG conducted by Skift, 80 percent of business travelers said that loyalty is important or very important to them.
“Corporate travel managers also need a proposition that’s going to add value to their travel program – whether it’s increasing traveler satisfaction, driving compliance, or helping them manage their costs,” Balsley says. “We actively support travel managers by educating travelers that they can participate with our loyalty program while still adhering to their policy.”
For example, Balsley points out that travelers can earn points from the IHG Rewards Club promotions to help them gain elite tiers with member benefits such as free room upgrades and late check out. Travelers can also take advantage of points by using them for leisure travel in their time away from work.
“We want to ensure we are offering corporate travel managers the tools to lead successful programs, manage costs and drive compliance, while providing business travelers with an exceptional experience,” Balsley says. “We are constantly evolving IHG Rewards Club to make it easier for our B2B customers to encourage the traveler behavior they are trying to achieve through leveraging the power of loyalty.”
Laura Kusto, senior director and global lead of spend management consulting and dynamic sourcing for BCD Travel, notes travelers would prefer to have all their loyalty points in one basket for a couple of reasons: One, it gives them status at that chain and then they have a better experience (e.g. upgrades). Two, it rewards them with leisure opportunities.
“Employees who travel the most earn the most points,” Kusto says. “Most road warriors have come to expect those points as an added benefit in exchange for all of their time away from home.”
Perks of Loyalty Marriott’s loyalty program has gone from being largely transactional to being experiential. For instance, with Marriott Bonvoy Moments, members can redeem points for once-in-a-lifetime experiences that tap into their passions for sports, music, entertainment, culinary adventures and more.
“The Marriott Bonvoy program offerings have grown tremendously as the company has launched and acquired brands, giving it more selection and locations to choose from than any other program,” Wolf says. “Members today experience more personalization as we are able to tailor to their specific needs. For example, with Ambassador Elite status, members receive their own personal ambassador to assist them with whatever they need when they travel and stay with us.”
This is all about working closely with the travel manager and any other partners in the supply chain. From Marriott’s perspective, Wolf says it starts with having the right hotels in the corporation’s travel program.
“From there, we look to identify the right initiatives; these range from unique benefits that incentivize travelers to sign up for our Marriott Bonvoy program to customized services or programs at the hotel level to recognize the travelers as a part of both Marriott Bonvoy and their respective employer,” he says.
Recently, IHG introduced new partnerships with Mr & Mrs Smith, the global travel club and boutique hotel specialists, and with US Open Tennis Championships.
In addition, the company offers IHG Business Rewards, a program extension focused on travel arrangers and meeting planners who book accommodations, meetings or events on behalf of others by offering three points for every $1 spent, with no minimum spend required. They can then redeem points for personal or company rewards, including hotel stays, travel tools like TSA PreCheck or Meetings Credits, a pre-paid meeting card.
RoomIt offers Loyalty Booster, an initiative to increase client’s program compliance by bringing sought-after rewards back in channel instead of seeing travelers go outside the program for them. RoomIt runs limited time promotions through the year featuring preferred suppliers’ loyalty programs that travelers already know and love.
“We always require travelers to book through clients’ preferred channels including their corporate travel booking tool to receive the rewards,” Waldmiller says. “The travelers receive a notification about the opportunity before the point of sale via e-mail and through their preferred booking channels. They simply book a room at a participating supplier, no registration required, and the points are automatically applied to the travelers’ loyalty account, from airlines to hotels to food and beverage. And companies receive campaign reporting.”
RoomIt has expanded the program by partnering with more preferred suppliers and has developed communications to reach travelers before booking. Since inception in 2016, Loyalty Booster campaigns have grown from 20 clients regionally to more than 250 clients globally per campaign.
Driving Compliance Loyalty programs can be important tools for corporate travel managers to drive traveler satisfaction and compliance to their travel programs. Wolf notes the key to success is a partnership between the corporate travel buyer and their hotel partners.
“Open dialogue on what success looks like, how we can work together for mutual benefit, and staying nimble to adjust to the ever-changing needs of the business has proved to be very successful,” he says. “We have a team responsible for managing the relationship with Marriott’s largest B2B customers. Our teams are focused on working with the travel managers and other business partners such as the travel management companies, not against them. This is all about trust, partnerships, and finding ways where everyone wins.”
Waldmiller explains one way hotel loyalty programs and corporate travel programs can work together is through bundled TMC rates. Offering bundling in TMC rates can offer hotels access to more business travelers, while improving travel program compliance.
“For example, RoomIt’s unique content program, RoomIt Rates, are sought out by our business travelers because travelers know the rates are sure to include amenities they love like loyalty points, in-room WiFi and complimentary upgrades,” he says. “Our research shows that 65 percent of business travelers in managed travel programs would prefer booking an accommodation with loyalty points over a less expensive rate, and 78 percent of business travelers say they would prefer to book rates that included multiple amenities, even if the rate is slightly higher, meaning forgoing loyalty points in bundled rates could be a major missed opportunity.”
Conventional wisdom says hotel loyalty programs have the potential to work at cross-purposes with a corporate travel program if they encourage travelers to be loyal to the hotel brand ahead of adhering to corporate policy. However BCD Travel’s Kusto believes this is an outdated approach.
The smart, modern way to view compliance is no longer with respect to a set of “preferred” hotels – it is adherence to a company’s booking channels. The keys to achieving this type of compliance revolve around the traveler experience, by optimizing the online booking tool configuration, using virtual payment and seamless submission of expense reports.
“If you limit the hotel choices of your travelers to one to three hotel chains, you’re relying on just those few hotel chains to determine the value of your business – and relying on them to give you the best rates 100 percent of the time,” Kusto says. “Instead of driving compliance at the hotel level, our recommendation is to drive compliance to your booking channel.”
That’s why in order to provide clients with all the hotel options they wish to see, BCD Travel’s content has evolved to include more rates which do not include loyalty points.
“The goal was never to present hotel rates that excluded loyalty points. Rather, it was to give our clients as many options as possible,” Kusto says. “Bringing travelers in-channel and keeping them there will reward them with loyalty points on every hotel booking at any chain or independent properties. That’s where traveler engagement comes in. It’s a powerful tool for compliance.”
Advice for the Buyer Kusto notes focusing too heavily on the strength of hotel loyalty programs is risky because of its over-reliance on hotel brands to deliver consistent results. After all, if a chain decides to dramatically change their loyalty program or merges with another chain, how will that play out?
“Instead of relying on hotel loyalty programs to drive results, travel managers should look for ways to have loyalty programs complement the travel program,” she says. “Acknowledge that loyalty programs exist and know travelers (and especially road warriors) highly value them. But build travel programs around opportunities for savings – and savings are achieved by engaging with travelers in a way that drives smart buying decisions.”
For travel buyers, understanding your travelers’ needs and wants is crucial for traveler satisfaction. “By learning what hotel brands your travelers are loyal to, you can seek out those negotiations to in turn improve your program compliance,” Waldmiller says. “When you bring the right hotels at the right rates to travelers, then it’s a win-win.”