Skift Take

Everyone in the hotel space is taking a good, hard look at their loyalty programs for good reason, and Hyatt is no exception. It'll be interesting, however, to see if their strategy to appeal to the "sophisticated high-end traveler" delivers.

Beginning March 1, 2017, the Hyatt Gold Passport program, which counts approximately 20 million members, will cease to exist and, in its place, a new hospitality loyalty program will emerge: World of Hyatt.

The new loyalty program reflects a somewhat significant loyalty strategy pivot for Hyatt Hotels Corporation in that it was distinctly designed to appeal to “build community and engage with our customers who are that high end of the travel space,” according to Hyatt Global CMO Maryam Banikarim.

In April, Hyatt CEO Mark Hoplamazian gave a bit of a hint to Skift about this shift, as well, saying:

“Assuming that the Marriott/Starwood merger closes, we will soon be the only multibrand, multinational company in the industry that is clearly hyperfocused on the high-end traveler. Every one of our brands in the different segments that we operate in are positioned in the top end of that particular segment. So that focus on the high-end traveler, a second focus on experiences, and third, how we enlist our own colleagues to bring those experiences to life and how we operate on that dimension. Those are all critical to our success.”

What prompted Hyatt to debut a brand-new loyalty program? Banikarim said it was the opportunity to build a stronger community of loyal travelers.

“The new program was driven by our purpose,” she said. “Not long ago, we articulated our purpose within the organization which is to get people to be their best and there are places where there are opportunities, and one of those was loyalty … it’s not just about rewards.”

That differentiation and focus on high-end travelers is also something that sets Hyatt’s program apart, she said.

Unlike other hotel loyalty programs such as Choice Privileges or Wyndham Rewards, which often pegs itself as being for the “everyday traveler,” Hyatt’s new program isn’t trying to, as Banikarim put it, “serve a much broader swath of consumers.”

“For us, loyalty with a capital L is about having a community,” she noted.

Notable Changes

Unlike Hyatt Gold Passport, the new World of Hyatt loyalty program has three tiers instead of just two. The new tiers are Discoverist (10 qualifying nights or 25,000 base points), Explorist (20 qualifying nights or 50,000 base points), and Globalist (60 qualifying nights or 100,000 base points).

Base points for this program are earned either through stays or for spending on such things as dining and spa treatments, both during a stay and even when members aren’t staying at a hotel. Members will earn five base points for every U.S. dollar spent.

This ability to earn points for spending with a hotel for such things as dining experiences is something often mentioned by Thom Kozik, VP of Global Loyalty for Marriott International, and it reflects, more broadly, what guests want from their travel loyalty programs.

Jeff Zidell, senior vice president of Hyatt, said that what Hyatt’s target guests wanted included “a broader range of benefits and more obtainable rewards” as well as “more rewards along the journey as your engagement with us increases.”

Zidell also noted, among the specific things guests wanted, were “more ways to earn free nights, opportunities for room upgrades, taking out pain points like no resort fees for paid nights for Globalists, free parking for Globalists, and things that just make the travel journey more seamless.”

Other benefits of being a member of the new program will include a free night award for a member who stays at five different Hyatt brands and confirmed suite upgrades at the time of booking for qualifying elite members.

When asked if they were concerned about alienating customers who may not necessarily be high-end travelers, Banikarim said, “We want to make sure there’s something for everyone in the program and it’s focused on more than just points. Loyalty is a two-way street and it often times goes beyond points. It’s knowing what they are going through and being there for them.”

Making the Transition

Zidell said that Hyatt has a system in place for the transition from Hyatt Gold Passport to World of Hyatt that “will provide the tier that’s most beneficial to the member” and will examine 2016 and 2017 activity up to March 1 to make sure that member is matched to the appropriate tier.

The Hyatt Gold Passport mobile app, which was recently revamped, will accordingly be updated in March with the debut of the new program, and the current member discount rate with up to a 10 percent discount will continue to be a part of the new loyalty program.

Zidell and Banikarim also said the program will continue to “focus on experiences and what that means,” echoing comments made by CEO Hoplamazian in April:

“We’ve recognized that if you conceive of loyalty through the lens of a transactional interaction, then you’re destined to a commoditized future. If all it is is an organized discounting system, there’s no emotional-based relationship that you can develop out of that. That’s just price.”

“Increasingly, we are rethinking loyalty in a very, very broad way. Not just the program but also what it means to actually extend the sense of our brand and our purpose to those interactions with our guests, and having that be the center of our focus and attention.”

“Yes, we will maintain a points program as well, because I think it does actually create some recognition that is giving something of innate value or inherent value to someone who’s a big customer of yours. But that’s going to be the end of the effort. There’s going to be other things that we will focus on, and most of that is going to be around creating experiences for people so that they can experience our brand in more diverse ways. That’s actually the rewrite that we’re in the process of doing right now. I think we can do it, given our scale.”

Note: For a closer comparison of the current Hyatt Gold Passport program with the new one, click here.

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Tags: hyatt, loyalty

Photo credit: Hyatt will debut a new loyalty program across its 12 hotel brands in March 2017. Hyatt Hotels Corp.

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