The Risks of Hotel Points and Reward Programs
Whoever came up with the first point reward system knew that consumers are eager to earn freebies. From airlines to hotel stays, consumers rack up massive quantities of points that can be redeemed for merchandise, free stays/travel, or in some cases cash. It’s a bonus program system that boasts huge participation levels.
The reason these programs work so well is that consumers often forget to use them. In a recent survey of frequent travelers, 47 percent have never redeemed points or rewards earned through airlines and hotels. Since most points systems are set up with definite expiration dates for earned rewards, millions of free comps are being left on the table. Great news for hotels, but what’s it doing for your business reputation?
Hoteliers have see it all, heard it all, and dealt with it all. It would be hard to find a hotel manager or owner who hasn’t had to ask a guest to leave due to bad habits or behavior. But what happens once you clear the hotel of the bad guest can you breathe that sigh of relief?
Hoteliers whose hotel businesses work with online booking agencies understand all too well the dilemma. Hotel booking sites like Expedia and Hotels.com sell hotel reservations to customers, hand over a discounted price to the hotels, and pocket their profits – all good business. But the dilemma arises when the booking companies go to pay taxes on the hotel rooms they’ve sold. And that’s where the local and state governments are getting involved.
It’s the news no hotelier wants to hear – union staff have voted to walk out. Not only do you have to find interim help that’s willing to cross picket lines; you have to find guests who are also willing to do so.
Unless you’ve been hiding under a rock, you already know that real estate values have taken a mighty hit. What once was up has indeed come down, which may not be all bad news for your hotel business. At a time when occupancy is lagging and costs are increasing, wouldn’t it be nice to catch a break?