8. LOYALTY v.X.0.
Loyalty programs are integrated in the tourist experience
and they should adequately respond to a dynamic digital
environment.
Previously analysed trends (e.g. Generation Z,
Technological (re)volution, Digital channels) require us to
rethink current business models and routines. In a world
that is constantly changing, it is crucial to respond to those
changes in timely manner.
Likewise, change is needed with old fashioned loyalty
programs, where collected bonus points are being
exchanged for rewards. Disparity occurs when the benefits
for targeted customers are questionable. In a world
where everything strives for personalization, the real
challenge is how to tailor each benefit to each customer’s
needs. Additional mismatch may occur by lack of ease
in redeeming reward points. Sometimes, it is difficult for
customers to understand what they can redeem for their
points and what actions they have to do in order to turn
those points into an actual benefit. Further discrepancy
can be evident in inadequate metrics used for the loyalty
program. Some of those metrics can be old-fashioned,
inconsistent, or just difficult to understand for the
customer.
To avoid confusion, changes in current loyalty programs
should be introduced. One possibility is to integrate loyalty
programs into the overall tourist journey thereby
enhancing the overall experience. Loyalty can find its
purpose in the whole process, starting from planning,
accommodation, activities, experiences in a hotel and in a
destination, all the way to aftermath of a travel experience.
Integration is also needed between various stakeholders in
the tourism sector (carriers, hoteliers, tourist boards etc.),
where alignment of business processes and a higher level
of collaboration between stakeholders is required.
In order achieve an identified form of integration more
easily, this process needs to take place in the digital
environment. The digital environment in loyalty programs
requires new technology solutions and improvements. Best
practice loyalty programs are already moving from physical
loyalty cards only to a digital form (mobile apps, online
portals etc.). A complete shift of loyalty programs in the
tourism sector to the digital world is inevitable, enabling
innovations in loyalty.
Using “Big Data” tools and techniques allows deeper and
more relevant insights (e.g. what products and services a
tourist needs at the particular time and place), which are
opening a spectrum of new possibilities in optimizing the
current offering as well as in innovation. “Big Data” also
enables faster data collection. Analysis of a large amount of
data that has been quickly collected allows the opportunity
for a quick response on guests’ needs such as adjustment
of the hotel’s program within a couple of days, or real time
adjustments for a guest while in a hotel. Those benefits
should be leveraged to increase tourists’ experience,
making them feel valuable and included.