The best brand ambassadors are guests who have stayed in your hotel. A hotel referral program can be of great help. Referrals are a powerful tool for marketing because they are based on customer reviews and recommendations. Encourage satisfied guests to write reviews and recommend their family, friends or colleagues. This will help you expand your customer base while also building loyalty.
This article explains referral programs and how they work. It also provides examples, tips, and future trends to help you take advantage of referral marketing.
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What is a hotel referral program?
Referral programs offer rewards to guests who recommend new customers. Each referral is rewarded, so the more they refer, the more money they get. Your guests don’t have to be members of your loyalty program to refer other people, but they can complement one another.
What are the advantages of hotel referral programs?
Hotel referral programs offer many benefits. They can increase direct bookings, enhance guest loyalty, generate higher-quality leads, improve marketing conversion rates and make campaigns more cost-effective.
Leads of higher quality
Getting leads is one of the most expensive parts of marketing. Guests who are referred to you have a higher intention to book because they may already be planning their trip. The lifetime value of the leads increases as they are more engaged.
More direct bookings
Referral codes are given to people who sign up for the program. They can then book directly through your hotel. Bookings become more profitable because you do not have to pay commissions from third parties, and your hotel’s website can perform better.
A more cost-effective
Word of mouth is one of the most affordable and effective marketing strategies. Referred guests are more likely to book as they trust the brand better, which reduces cost barriers.
More loyal guests
Referral or loyalty programs encourage guests to return to a hotel.
What is the program?
Guests are invited to participate in the program via emails, loyalty programs, promotions, and on-site check-ins or check-outs.
Once guests have enrolled, they will receive a code or link to share with their friends and family. Referred guests who book using the code earn rewards for the referrer, such as loyalty points, a discount or a free stay. Tiered incentives are a great way to encourage referrals and increase engagement.
Four examples of successful hotel referral programs
Here are some examples of successful hotel referral programs.
Marriott
Marriot rewards guests who refer others to book directly. The program is free to join and encourages direct bookings. It can be used at 8,500+ Marriott hotels in 132+ different countries.
The Marriott Bonvoy program also awards points for both the referrer and the referee, which enhances the loyalty program engagement.
NH Hotels
NH Hotels offers a price guarantee and a welcome promotion of 12% for the first 3 months. Referrers will then earn 10% on all post-click bookings based on the total amount of accommodation.
Hilton Honors
Hilton Honors offers bonus points to both the referrer and the referee when a guest is referred who completes a reservation. This program is integrated seamlessly with Hilton’s loyalty program.
IHG Rewards Club
IHG Rewards Club has tiered bonuses that allow you to earn loyalty points. These points, earned while shopping, dining, or travelling, can unlock rewards to encourage further participation.
How you can create a referral program that works for your hotel
Personalization is the key
Using hotel management software, you can tailor your incentives to guests’ preferences and behaviour. Personalized rewards will ultimately increase engagement and participation in your community.
Simplify
An effective referral program should be simple to use.
Monitor performance and optimize
Monitor your referral program closely, paying attention to key performance indicators such as conversion rates, participation rates, and reviews. Use these data to make changes and improve areas that need improvement.
Promote via different channels.
Maximize your participation by promoting it through social media, emails, loyalty program communications, and push notifications. You can also remind people in person at check-in and check-out.
Signage in the rooms and throughout the hotel can also help to increase awareness.
Create a clear reward structure.
A clear reward structure will help your hotel referral program succeed. Bookings with a higher value should qualify for a larger reward bonus. Decide whether to reward the referrer only or the guest referred. Rewards for both guests will increase the participation and success rate.
Consider offering ongoing discounts for repeat bookings to encourage long-term engagement.
Future trends in hotel referral programs
Hotel referral programs have existed for a long time, but digital strategies are now playing a larger role. Mobile applications are essential to seamless referral sharing.
Hotels are increasingly partnering with influencers to increase program visibility. Gamification, which makes participation more interactive by introducing challenges and tiers of rewards, is also growing in popularity.
Conclusion
Referral programs are an important part of any hotel’s marketing plan. They are cost-effective and generate high-quality leads. They also drive direct bookings and guest loyalty. These benefits combined make referral programs a powerful tool to boost profitability.
Turning guests into brand ambassadors creates a win-win situation – driving growth for your business while improving the guest experience.
