A well-known study by Frederick Reichheld showed that increasing customer retention by 5% can improve profits by between 25% to 95%. Customer retention strategies can help hotels quickly increase their profits. These numbers speak to an important element of any business: profit.
Marketing to existing customers can help reduce advertising expenses by 6-7 times. Research conducted by Marketing Metrics shows success rates of selling to an existing customer of 60-70%, compared to 5-20% of a new one.
This turns the traditional marketing directive of finding more clients on its head. Businesses need to rethink how the customer journey impacts profitability. This guide looks at how building these customer retention strategies can increase profits.
Owning Your Leads
Creating customer loyalty is no easy feat, but mapping your customer journey is the best way to start. Dissecting your customer journey gives you useful insight into where you can improve.
Your customer journey of how a “lead” converts to a “customer” is important to optimise. The aim is to make this process as sticky as possible. For example, using Online Travel Agencies is a great way to get a large number of first-time bookings. But, these leads might not as easily return.
How often do potential clients interact with your brand when booking? How visible is your brand through this process? Developing a loyal and returning customer requires close attention and strategic planning.
The Role of Discounts and Unique Experiences
Discounts are one of the first ways to get existing customers to return to your hotel. But, they often need customers to sign up for loyalty programs. With new generations of travellers, loyalty programs are not as attractive as they used to be.
However, discounts are not the only options when it comes to offering a competitive experience. Room upgrades are a type of discount hotels can offer VIP guests who might be likely to return.
Offering VIP guests a personal experience is another way to win over repeat bookings. Ensuring your staff knows guests’ names and meeting any specific needs are requested, are two no-cost ways to offer a personalised experience.
Unique experiences are also an excellent option when it comes to creating customer loyalty. For many new travellers, a focus on hotel sustainability can be an important feature to highlight. When it comes to experience, a happy customer is a returning customer.
After a Stay - Gathering and Using Customer Feedback
Customer feedback is your secret weapon in your customer retention strategy. By gathering information at the end of a guest’s stay you can find out what worked, what didn’t, and what changes you need to make. This is also critical data for your customer service metrics.
Getting guest feedback before they post it online can also present an opportunity. Hotels can rectify issues before any negative reviews are posted. Your customer feedback is useful for mapping your customer journey and should be a focus for your customer service team.
Curating Your Customer Retention Strategies
Customer retention strategies are easy ways hotels can increase revenues and profitability.
Understanding your customer journey and enhancing guest experiences is the way to go to foster brand loyalty. If you are looking to generate leads with higher brand visibility, you can contact us for a free consultation.
Christina, BD
