Are you loyal?
Hotels commonly offer loyalty programs to their guests. Do you often go back to the same hotel to enjoy rewards? I’m more the type to search for the best offers online 😉.
History of Loyalty Programs
A loyalty program is a marketing strategy designed to encourage customers to continue to shop at or use the services of a business associated with the program.
Benjamin Talbot Babbitt is likely the true creator of the modern loyalty program. Born in 1809, Babbitt designed a cheap process to make a key base ingredient of baking powder. He soon grew his business to include yeast, baking powder and soap powder. He was the first to sell individually wrapped bars of soap, with ‘Babbitt’s Best Soap’ becoming a household name all over the US. In the 1850s, Babbitt Inc. launched a program where it invited customers to cut and collect the ‘trade marks’ from packaging of Best Soap and 1776 Soap Powder, which could then be exchanged for coloured lithographs by mailing them to the company.
In the hotel industry, two major brands introduced loyalty programs. In February 1983, Holiday Inn launched the first-ever hotel program. In November 1983, Marriott followed suite. Initially, the loyalty schemes were associated to airlines. Rewards earned could be used to book free or discounted flights. However, after a while, hoteliers found that these programs were more beneficial to airlines than to them. They therefore started to develop their own programs where guests could use reward points to book a room or enjoy other hotel services. Four large hotel brands – IHG, Marriott, Hilton Worldwide, and Starwood Hotels & Resorts Worldwide – were the first to implement loyalty programs.