Learning from those who have come before is a basic tenant of life — and marketing. And when it comes to building a loyalty program worth emulating, few have set the standard more solidly than the hospitality industry. After all, hospitality is an industry built on customer service and experiences, so it naturally lends itself to enthusiasm and connections with its customers.
Financial services, on the other hand, can experience an uphill battle where loyalty is concerned. Yes, its customers are engaged, but creating those deep connections can be a bit more challenging when your central communications are about interest rates and bills instead of vacation destinations.
FinServ has undoubtedly paved its own successful path in the world of customer loyalty programs, but there are a few pointers it could take from the world of hotels and travel.
Step things up with tiered loyalty
Keeping members engaged is a constant battle for any industry, and one that the hospitality industry found a solution for decades ago: tiers. By building levels of achievement into a loyalty program, hospitality brands build in inherent motivation for customers to reach that next level (whatever it may be).
With the recent launch of its Bonvoy program, Marriott brought its tiers to new heights as it took on the task of merging the Starwood Preferred Guest loyalty programs with its own. When first announced, customers of Marriott and the hotels it had acquired had one question: Will this affect my status? Marriott’s clear communication regarding tiers and their continued existence in the new world of Bonvoy was critical to a successful migration. After all, customers are emotionally invested in their loyalty status.
For FinServ companies looking for more rewarding ways to connect with customers, tiers just make sense. The goal of making it to the next tier will keep new customers motivated and engaged. Add in exclusive benefits (more on that later) and you’ll keep long-time customers surprised, delighted, and singing your praises.
Remember the point of points
Don’t let the addition of tiers distract you from providing value for all of your members. Incentives are just as important for new loyalty program members as they are to those who’ve risen through the ranks. Too often the threshold for any true value (i.e., things worth redeeming points on) can take years to reach, depending on customer habits.
Hospitality brands like Hilton are starting to change that. In recent years, Hilton has made major adjustments to its point-spending tools to allow travelers to pay partially with points. The shift helped non-Platinum members start seeing value sooner, which has had a serious impact on program engagement (up roughly 50%). By taking this page from the hospitality playbook and rewarding customers sooner with benefits they actually want (e.g., free checking and extended grace periods on payments), FinServ brands can strengthen connections with customers earlier in their relationship to build loyalty that lasts.
Create unique experiences
Incorporating experiences to inspire loyalty is not a foreign concept to the financial sector (e.g., American Express exclusive access), however, it is a space that hospitality has and continues to revolutionize. Take Marriott again, for example. Through its Bonvoy loyalty program, in addition to free nights and perks at its hotels, loyalty members can use points for exclusive access to VIP experiences at concerts, music festivals, sporting events, and more all around the world.
Finding the right experiential approach to drive loyalty with your customers really comes down to understanding them. FinServ brands can take this tip from the hospitality leaders and take full advantage of all the data customers share — demographics, account preferences, social media shares, and whatever comes next.
When it comes to loyalty, the gap between hospitality and finance is not nearly as large as you might think. The ultimate goal is the same: connect with customers where they’re at in ways that add value and keep them enthusiastically returning. With a little help from the hospitality industry, FinServ brands can serve up loyalty programs that inspire deeper, lasting connections with their customers.
Contact Cheetah Digital here to step up your FinServ loyalty today.
Cheetah Digital is a cross-channel customer engagement solution provider for the modern marketer. The Cheetah Digital Customer Engagement Suite enables marketers to drive revenue, build lasting customer relationships, and deliver a unique value exchange throughout the entire customer lifecycle. We are a business partner to the world’s best brands and have employees across 13 countries.