7 Customer Retention Strategies to Increase Guest Loyalty at Your Hotel

September 1, 2022

You’ve heard it said millions of times before – it costs more to acquire a new customer than it does to keep an existing one. Five times as much, to be exact.

While necessary, customer acquisition can add significant drag to the growth of your profits, especially when customer retention is not given the same attention. For property owners and hotel managers alike, the pain of an ever growing marketing budget is only worsened by a revolving door of single-stay guests. However, did you know that increasing your customer retention rate by just 5% can increase your profits by as much as 25% to 95%?

Of course, we all know that long lasting relationships with customers can’t be formed overnight. This leads many hoteliers to wonder how they can make such a significant impact on their customer retention rates, and what are the best strategies to do so?

Today we will be breaking down exactly what your hotel management team should focus on in order to increase customer retention and decrease overall marketing costs.

After reading this guide you’ll better understand how to:

Maximize your customer loyalty
Promote direct bookings to build stronger relationships
Leverage technology to improve the guest experience
And many more tactics to improve your customer retention!

Pre-arrival: Start an amazing relationship with your guests before they arrive.

Booking confirmation emails

In order to increase the amount of guests that remain loyal to your hotel for the long-term, it is always a good idea to make a good first impression. This can be done with an automatically triggered booking confirmation email.

Take your booking confirmation email as an opportunity to set the scene for the guest experience at your hotel. Some best practices for a guest-pleasing confirmation email include:

Important information such as check-in and check-out times, date of arrival and address of your location.
A map of your hotel and the surrounding area.
Activity suggestions and sightseeing recommendations for guests to enjoy during their stay.
- Pro tip: If your hotel offers sightseeing tours or fun activities this is a great way to upsell your guests and improve their experience!

To read more about best practices for your booking confirmation emails, scroll through our recent blog post on 14+ Powerful Confirmation Email Templates And Examples.

Prioritize direct bookings vs. OTAs

There are a few key reasons why hotels should prioritize direct bookings over online travel agencies (OTAs). First, direct bookings allow for better opportunities to build guest relationships. OTAs act as a buffer between your hotel and the guest, and though they can help you fill rooms faster, they’ll also get in the way of your guest relationships.

If a guest books through an OTA, and then enjoys a fantastic experience at your hotel, they’ll be more likely to remain loyal to the online travel agency. Why? Because the OTA was their first point of contact. First impressions matter when building relationships! According to a survey by ClickFox, 48% of customers say first impressions are the most important time to gain their loyalty.

When guests book directly with a hotel, they are more likely to be familiar with the brand and have loyalty to it. Second, when guests book directly, you’ll have the chance to further introduce them to your brand through follow-up emails and loyalty programs.

Use booking abandonment tools to land more direct bookings

You can also take advantage of booking abandonment tools to land more direct bookings. The travel industry is a multi-billion dollar business, but many sites lack conventional marketing to boost their conversion rates. As much as 81% of travelers leave without completing any booking due in part from poor customer service and difficult site navigation!

These services allow you to target visitors who have abandoned their booking and send them a friendly reminder that will help them complete their transaction. Friendly reminders sent through email, push notifications, or exit-intent pop-ups can increase your direct bookings and recover lost revenue. Tools like RezRecover automate this entire process for you, making the recovery process quick and simple.

During their stay: Deliver an exceptional guest experience that will linger.

Make your customers feel like a VIP

When it comes to providing excellent customer service, hotels need to go above and beyond to ensure that each and every guest feels valued and appreciated. One way to do this is by personalizing the service that you provide.

Remembering important dates like birthdays and anniversaries, or taking note of room preferences are small touches that can make a big difference. Another idea is to create a VIP loyalty program for your most loyal guests. This will make them feel special and appreciated, and more likely to return to your hotel in the future.

No matter what kind of personal touch you add, it’s important to always go the extra mile for your guests. This could mean anything from responding quickly to requests, no matter how big or small, to offering exclusive deals and promotions. By providing personalized service, you’ll give your guests a reason to keep coming back – and that’s good for business.

Use technology to provide a better experience

In today’s digital world, it is important for hotels to understand that the way they communicate with their guests has changed. Once upon a time, customers would only have access to the phone and email. Nowadays, Millennials and Gen Z are more likely to check-in online or through an app on their mobile device. This means that you must adapt your communication strategy by using digital channels like SMS messaging and email marketing campaigns for customer retention programs.

To increase engagement with your customers during their stay at your hotel, consider sending out friendly automated messages such as asking them how their stay is going or whether they need anything else from you. When it comes down to it though, nothing beats a personal touch – so if you have any staff members available who could give that extra level of service then do so!

Listen to guest feedback (and ask for it!)

Listening to and asking for guest feedback is an essential part of the hospitality industry. When it comes to improving customer retention, you will only succeed if your guests are willing to share their experiences with you—and one of the best ways for them to do so is through a simple form or survey.

Many hotels find that using online surveys is an excellent way of gathering feedback from guests. In fact, when a survey is well executed and offers enticing motivation, like an entry to win a prize, response rates can soar to over 85%. No matter what method you choose, there are several things that make up good listening strategies:

Ask open-ended questions
Use multiple choice questions sparingly
Keep surveys short
Always send a follow-up email

Post-Stay: Nurture your guest relationships to bring them back for more.

Stay in touch and follow-up.

Follow-up emails sent after guests have left your hotel are one of the most effective tools you have to keep them coming back again and again. They’re also an easy way to get more bookings, since people who have been treated well will naturally want to do business with you again.

Follow-up emails, which can be automated and sent out automatically once someone has checked out of a room, are a great way for hotels to stay in touch with customers and build loyalty with them. You can use these follow-ups to thank guests for staying with you and offer additional services that they might find interesting or useful in the future (e.g., discounts on spa treatments).

It’s important that all hotels send this type of communication after every stay — even if it’s just one line thanking people for their business! It just takes some time planning on your part so that everything is set up correctly from the beginning; but once everything is ready then there should be no reason why any traveler will miss out on being offered special offers at their next visit.

Remember, guest retention starts with guest relationships.

There’s no doubt that maintaining loyal guests can lead to increased profits for your hotel, but the real prize is the guest relationships themselves. The best customer retention strategies for hotels focus on providing personalized service, using booking abandonment tools to retain every booking, and asking for feedback in order to always improve your guest experience. By implementing these strategies, you can create lifelong relationships with your guests that will result in repeat business and referrals.

By implementing these best customer retention strategies for hotels, you’ll be on your way to developing the strong guest relationships that will lead to both increased profits and a thriving business. So what are you waiting for?

To start recovering lost bookings today, sign-up for RezRecover – the leading booking abandonment tool in the hospitality industry. RezRecover is easy to use and comes with a free trial, so you have nothing to lose and everything to gain. Sign up now and start retaining more bookings and creating lasting relationships with your guests.