When it comes to loyalty program status the question that often comes up is “what’s it worth?” . A two-sided question:
1°) What is it worth intrinsically in terms of benefits.
2°) How much it costs to achieve it.
A status is a give and take
In general, the two are closely linked: the simpler a status is to achieve, the more it is devalued and the less it offers consistent benefits.
Let’s take a look at the Accorhotels Club loyalty program.
Gold status is second in importance, offers interesting benefits (although we believe that it is not a very generous loyalty program for its members) and should therefore be relatively difficult to achieve. This is the case with the 30-night threshold, which corresponds to a “higher average” traveler, compared to the 60-night platinum requirement for frequent travelers.
Thresholds whose role is to encourage brand loyalty and to encourage people to put all their eggs in the same basket by avoiding “wasting” nights elsewhere with a double expected consequence:
1°) Revenue for Accorhotels because the customer will be encouraged to spend most of his trips in the group’s brands.
2°) Once the threshold is reached, recognition and benefits for the member.
What would be the consequences of making a status easy to achieve for anyone?
1°) Devaluation of the status for the member
2°) Reduction of benefits for the member
3°) For the hotelier to give benefits to occasional customers that are not compensated by the money spent at the end of the year by the customer.
With 30 nights or 2800 euros spent we are far from it. Theoretically. In practice, it is very easy to become Gold at AccorHotels for an occasional customer who wants the benefits for the few nights he spends with them during the year when he either travels little or prefers the competition’s hotels when they are available.
Become Gold for 90 euros !
All you have to do is apply for the Ibis Business card. It offers benefits to customers who regularly stay in Ibis for an annual fee of 90 euros.
But the most interesting advantage is not there….
Its holding confers to the holder a gold status in an automatic way. A very appreciable advantage, for sure, for customers who do Ibis on business trips and are offered a nice level of recognition when they go to the group’s more premium chains without staying 30 nights per year.
But an even better deal for customers who only go to AccorHotels occasionally when nothing else is available and would like to enjoy the benefits they have at the hotels they faithfully frequent.
It is not certain that this practice raises the level of the program, on the contrary, it encourages unloyalty. A gold status must be relatively exclusive and provide substantial benefits, which is not the case here because anyone can afford it for about the price of a night in a 2 star hotel. All this to the detriment of the “real” gold who find themselves with a devalued status with benefits that could be more important.
It remains to be seen how many people discovered AccorHotels “by chance” thanks to this very interesting Ibis card and decided to adopt it because the experience was conclusive. From a marketing point of view it can be a very profitable acquisition strategy.
Using the loyalty program as a marketing tool is a strategy that pays off in terms of acquisition but can be disappointing in the long run for the loyal customer.
Photo : Accorhotels by Casimiro PT via Shutterstock
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