October 2018, Las Vegas
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The disloyal customer is an opportunity for growth, says Expedia
While many hotels continue the drive to secure more direct bookings, online travel agents like Expedia are capitalising on fickle consumer behaviour
In a world of unlimited choice, the disloyal customer is one of the biggest challenges facing travel businesses. Thanks to consolidation in the hotel industry, this is further complicated by the number of brands that can belong to a specific chain, and uncertainty that arises for consumers around what their loyalty perks are.
Companies like Expedia see this as an opportunity. According Brandon Ehrhardt, Director for Platform Services, Loyalty, Expedia, “the disloyal consumer is viewed as an asset because we focus on loyalty as an experience, not a specific chain of hotels”.
One of the Expedia’s specific loyalty programmes is VIP access, which launched in 2010 on Brand Expedia and in one point-of-sale – the US. Since then it has grown the programme’s presence to five brands - Expedia, Hotels.com, Orbitz, Mr. Jet, and ebookers. By the end of this year, the programme will be featured on over 50 points-of-sale. Like all OTA loyalty programmes, VIP Access is positioned on both sides of the two-sided lodging marketplace.
- Owners get access to consumers who, according to a 2018 study conducted by Mastercard, stay longer and spend nearly $200 more on property than non-VIP guests.
- Guests can rest easy that their hotel has been vetted personally by Expedia’s market management team, and premium tier members will receive benefits like Wifi, resort credits and room upgrades.
EyeforTravel put some questions to Ehrhardt, who will be speaking in Las Vegas on a session with Alejandra Martinez, Product Performance Manager Booking.com, about how technology can help drive loyalty.
EFT: The VIP Access programme already has ‘3,500 handpicked hotels’ according to the Expedia website. Do you have plans for future growth?
BE: Actually VIP Access offers travellers the ability to book 4,200 properties in 700 markets today, but we have bigger aspirations as we look to the future. Scale is important to increase consumer repeat. Obviously, it’s hard for a consumer to repeat with a brand or programme like VIP Access when there aren’t hotels in the area they’re looking at. However, in addition to our plans to grow, we remain focused on providing an exclusive, handpicked collection of properties.
EFT: How are properties selected?
Properties are selected based on their review score, star rating, and the amenity and benefits they’re willing to provide members. Additionally, ‘handpicked’ means that when a guest books a VIP Access hotel, they can be assured that in addition to stringent qualifications for the programme a market manager at Expedia Group has given it the ‘eye test’ by staying at or touring the property prior to going live as a VIP Access hotel.
Personalisation will be the straw that stirs the loyalty drink
EFT: One of the challenges for hotels is training front desk staff to know that programmes like this actually exist. As just one example on TripAdvisor a customer had this complaint: ‘I've booked a VIP hotel over this weekend in Vegas, I'm a gold member and when I did bring this up to the hotel's front desk, he has no idea what I was talking about…’
BE: This isn’t the experience we strive to provide to our mutual customers but this sort of thing is much more the exception than the rule. Currently, we have nearly a 90% member satisfaction score and that number continues to improve year on year. Additionally, what we’re committing to, as we move into the next chapter of VIP Access, is improving the lodging partner experience that will lead to further member satisfaction score improvements. To do so, we will leverage technology to make member recognition easier for our lodging partners by passing on loyalty attributes, such as loyalty status, in the booking notification as well as highlighting them in our ‘partner central’ tools.
EFT: But how do you ensure that hotels educate their front desk staff about programmes like this? This remains a challenge…
BE: With the turnover in the hospitality industry, this can be a challenge, but we focus on making training easy and the programme intuitive. Too often loyalty programmes can be hard to execute from an operational perspective because there are so many intricacies that complicate guest recognition and benefit delivery. As we evolve our programme, our focus will be to utilise technology to do the heavy lifting and to simplify this process for our lodging partners. This work will continue in conjunction with our efforts to put shopping and demand trend tools, like Rev+, in lodging owner’s hands so they stay ahead of their competition.
EFT: Loyalty is changing rapidly - what do you see as the key tech trends going forward and what is Expedia Group doing to be at the forefront of these?
BE: Personalisation will be the straw that stirs the loyalty drink. Understanding what experience members who shop for a VIP Access properties desire will help us surface what will inspire them to travel and to continue travelling with us. At Expedia Group we run hundreds of tests at any given time and use these to dive deeper into customer preferences, allowing us to help them discover amazing places around the world where they can partake in a curated, unique experience tailored to what inspires them most.