Skift Take

The likes of Alibaba, Grab, and Rakuten have billions of members. If hotels can tap into a just fraction of their users, and convert them to their own loyalty schemes, they'll be mighty happy.

Marriott International will apply lessons learned from its Alibaba joint venture in China to boost numbers for its Bonvoy loyalty program elsewhere, because local knowledge goes a long way.

The pandemic forced hotel groups to get creative when it comes to keeping their loyalty programs relevant, and the superapp could be the star when it comes to tapping local markets for a domestic recovery.

“It’s a very powerful model,” said Peggy Fang Roe, global officer of customer experience, loyalty and new ventures for Marriott International.

Peggy Fang Roe speaking at Skift’s Loyalty and Subscription Summit.

Peggy Fang Roe speaking at Skift’s Loyalty and Subscription Summit.

Speaking at Skift’s Loyalty and Subscription Summit on Wednesday, she added: “We tested this with Alibaba because it was an ecosystem partner, we could find a win-win with them. They’re in many different business, travel being just one of them. We were able to bring something to them that they were looking to expand on, and they have a built-in member base.”

On her radar were Rakuten in Japan, and Grab in Southeast Asia, which is set to go public with Altimeter at a $40 billion valuation.

“It’s natural for us to lean in there, and say ‘hey, how can we do something together and create value for our members’,” she added in discussion with hospitality reporter Cameron Sperance.

Appetite for Growth

But the hotel group hasn’t been afraid to test a range of methods to attract more guests to join Bonvoy during the pandemic. Fang Roe saw a lot of consumer behaviour shift. Clearly people weren’t spending money on hotels, so the group moved points to where they were spending.

That mostly involved eating.

She said Marriott had already been working with Uber, so thought Uber Eats would be compelling to give members more points to earn.

Speaking during the “How Loyalty Has Become More Important to Travelers Post-Pandemic” session, Sperance asked if there were other “seeds for where growth may come from.”

Fang Roe said the hotels had ventured into the remote work arena, converting rooms to offices and setting up collaborative spaces, but the results were mixed.

“If we look at business travel, you’ve got a lot of companies saying you don’t have to come back to the building,” she said. “We tested it in 15 markets, to be honest it was up and down, with Covid restrictions. It didn’t tell us anything super compelling.”

However, in recent weeks it’s seen an uptick, and like rival Accor, she thinks it will be opportunity.

Selling bathrobes, bedding and candles hadn’t gone too badly either, as she said Marriott’s retail sales were at 26 percent, and this all helped to “bring the experience home.”

Marriott ended the year with 145 million Bonvoy members, and while new enrollments were down, the member base had stayed active. In recent months, she said redemptions were up, and that registrations had climbed back to 2019 levels.

Meanwhile, Fang Roe maintained having Bonvoy was a strength for the brand when it came to signing up new hotels: “Bonvoy is our competitive advantage. We have a higher quality member, in terms of what they’re willing to pay, rather than wholesale loyalty schemes that are about rates.” A strong loyalty program lowers the cost of marketing for hotel owners, she added.

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Tags: accor, alibaba, china, grab, loyalty, marriott, skift live, skift loyalty and subscription summit, superapps, uber

Photo Credit: Elegant Hotels will transform Treasure Beach into an All-Inclusive by Marriott Resorts property. Marriott

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