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ACCOR ran the 4th edition of their global competition ‘Take Off,’ with a focus on the Customer Loyalty Program at Accor in 2020. Les Roches MBA students Gulnara Yakupova, Akho Kezo and Egor Otmakhov, talk about their experience and vision behind their entry.
Loyalty programs are popular with the travel and tourism sectors and something that customers have come to expect in their interaction with companies.
Loyalty programs, however, have been around for a long time and companies need to think about how to create new competitive edges in order to attract and retain customers.
The theme for ACCOR’s 4th Take Off competition was wisely chosen, therefore, and an issue that would test the strategic, business and creative skills of participants, as much as provide innovative ideas for ACCOR.
Loyalty cards are an experience-proved tool that helps to establish long-term relations with customers. With the concept that our team proposed, a loyalty program was a part of the whole process of a customer experience journey.
We looked at technologies and experience from other industries. Modern technology can help solve the problem of offering a personalized service at big properties of 800 rooms and more. As one of the solutions, we proposed using the existing customer recognition technology through Data Tracking Systems (DTS). It helps to recognize (to see on monitor) guests who are checked in into Wi-Fi network of the hotel.
In addition, we proposed elements of concierge services and travel support, which are well proven by private banking and luxury brands. This approach helps not only to offer specialized services and provide extra attention to the needs of a frequent guest during their stay, but also offers the possibility of extended communications with them when they leave the hotel.
Sébastien Bazin, Chairman & CEO, Accor Hotel Group defined current trend of “digitalization” of the industry, as “mutation”. Meaning that there is a crucial change going on, that expectations, behavior and the process of decision making by clients is changing.
Among other international hotel chains, Accor in my opinion is forced to adapt. For example, the group announced recently that part of their services are available for Iwatch users. The biggest drawback here is that IT innovations are easy to copy and not unique.
The hospitality industry has a situation which is similar to the banking and financial services industries, whereby online communications are becoming a more and more significant part of the customer’s experience. Key market players are keeping a strong focus on the IT part of their services and compete by digital innovations.
Another challenge is related to change of generations and new guests, with completely different expectations. To fulfil them the Accor group does strategic steps. At the beginning of 2014 the Group acquired around a 35% stake of the fresh lifestyle brand Mama Shelter. As a part of the deal, Accor will contribute to the expansion of the business. It means that 20 extra properties will be added to the current hotel-dining-party Mama Shelter spots in France and Turkey. Mama Shelter offers concepts and experiences which are relevant to the expectations, values and lifestyle of the new generation of travellers.
These issues are chosen based on the typical problems encountered by hotel chain loyalty programs and the customer expectations. Based on corporate reports of Accor Group, frequent business travellers are one of the key target groups. This type of guest usually has corporate budget limitations, a need to report on their expenditures. They are limited as well by time, and overloaded with professional information. So, in order to satisfy this guest, loyalty program should have a very simple concept with clear, valuable privileges. It should also be simple to understand, and be transparent with regard to real benefits accrued.
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