While customer loyalty programs are common in business hotels or resorts, many hoteliers seem to believe that luxury and customer loyalty are mutually exclusive.
"Some people say loyalty points and luxury don't mix," says Hilton HHonors Chief Jeffrey Diskin. "But the trends at both Conrad and Waldorf would dispel that notion."
Hilton guests can earn HHonors points at Hilton luxury brands- Conrad and Waldorf Astoria. Starwood has a similar approach with its Starwood Preferred Guest program. In contrast, Marriott-owned Ritz Carlton doesn't allow customers to earn Marriott Rewards points on Ritz-Carlton stays, but members can burn points to stay at a Ritz-Carlton hotel.
Guests who stay at luxury hotels comprise a minority, especially those who do not need or value loyalty programs. According to Hilton’s Luxury Brand Chief John Vanderslice: “It’s always overstated that luxury is an exclusive club.”
Customer loyalty programs have been generating revenue for many hotels, and are a logical approach, especially in the current economic environment.