In today’s hospitality arena, one of the hottest buzzwords is “guest loyalty.” Many large hoteliers and OTAs are bringing this concept to life through multiple channels when it comes to their guest loyalty programs.
However, the largest OTA has decided to change tack by shunning its loyalty program.
According to this recent Skift article, the Booking.com unit of Priceline is now aiming to create a great user experience for site visitors and app users instead of paying them to be loyal. The strategy behind this decision is that it can be costly to compensate customers through loyalty programs when they could become repeat customers and be loyal anyway.
While this is an unconventional approach, does this present a missed opportunity for Booking.com?
For example, the OTA could have branded this in a way that would have appealed to millennials and, for lack of a better term, hipsters. The new way to brand this could have been the “Anti-Loyalty Program,” which offers an ironic twist and could actually enhance loyalty.
However, the most significant missed opportunity is that there is no demonstration of value or reciprocation to the consumers. Booking.com could have created a customized dashboard or a calculator for guests that show them the savings they are achieving without the use of an actual loyalty program.
With mobility continuing to gain momentum, Booking.com is basing this approach on the belief that once customers use its app, the company doesn’t necessarily have to reacquire these users again through advertising, loyalty programs or other incentives.
This strategy could certainly pay off. But there are many inherent risks that come with this effort (or lack of effort). Without any direct reciprocation to the guest, Booking.com may have to re-change its tack and launch a comprehensive loyalty program.