Loyalty Programs for Hotels: Flok

Loyalty programs are very effective in creating repeat customers by giving them some incentive to keep returning. The best programs are the ones that are simple to understand, and give you satisfaction sooner. From a business perspective, a loyalty program should help drive business back to you without being a large cost.

A good example in Canada is Shoppers Drugmart Optimum points, which are earned based on the dollar amount you spend in the store. The reward points are clearly marked on the receipt with a list of the reward levels on the back to track your progress. It usually doesn't take long for you to reach the first reward level, and can be accelerated by opening up a RBC bank account or applying for a credit card. From a business perspective, the only way for customers to spend their points is through the store, even if they earn them elsewhere by using their bank or credit cards. There was an initial cost in setting up the program, but Shoppers Drugmart has operated their loyalty program for nearly ten years now, if not longer, with no major changes.

A bad example is AirMiles, which requires you to spend a lot of money to get even the most basic reward. You generally can't use points in stores to purchase things, and you have to visit the website to redeem the points. From a business perspective, giving out AirMiles to guests is expensive, and there is no true reward for repeat customers to use in the stores they earned the points at. Another problem is there is no incentive for people to choose a particular business if another competitor is offering AirMiles as well. Even worse is when businesses compete by offering more AirMiles than their competition, because with the costs attached to the points, the only real winners are the customers and AirMiles.

In my search for a loyalty program that would make sense for hotels, I came across two options: Belly and Flok.

Belly is rather straight forward: customers earn points for visiting the business by checking in with their phone app, and then redeem the points for certain rewards that you set out (free coffee, discounted lunch, etc.) From the business perspective, you gain more loyal customers because the points can only be redeemed at your business. You also build your marketing profiles of your guests, and they help spread the word about your business through social media for each time they check in. The marketing profiles are less important for hotels since you're collecting names, email addresses, and locations through your PMS. Belly would be a great option for hotels that have their own restaurants or bars on sight, but I don't think it would be that great of a fit for the rooms operations.

Flok has several layers to it which can be more beneficial for both guests and the property owners. Guests get rewards for punching in at the hotel, but can also receive special offers on their birthdays, for referring someone to the business, or even being randomly selected. The additional layer to the program is a tiered membership program: the more you stay, the more privileges you can earn.

Setting up the app does not take much time to do. For a guest, they download the app, create an account (can be done through Facebook), and then join your club. For a hotel, the hardest part is deciding which rewards to check on (everything is optional apart from the basic punchcard rewards) and what to offer. You can personalize the app with your logo, hotel information, and pictures, and guests can add their own photos within the app just like on TripAdvisor.

Main screen within Flok

There is only one punchcard reward available, but you can decide how many punches it takes in order to receive it. The minimum number is 2 and the maximum is 99, so plenty of flexibility for property owners to decide what would be best. Punching in happens by scanning a QR code through the app while at the hotel (presumably provided by the Front Desk agents, rather than displayed openly.) One of the best features about the punchcard which makes it appealing for hotel operations is you can set a limit on how often someone can punch in. The maximum is 24 hours, which works well with hotels, but could be down to 2 hours if you wanted to utilize this for a restaurant or cafe.

The tiered memberships are also flexible, but you are constrained to offering only three membership levels (Silver, Gold, Platinum) and a 60 character description for guests to see. You could certainly offer additional privileges for achieving certain reward levels, but that will have to be done through a page on the website or a handout. Guests can see what membership level they are at in the app, and also how many more stays that need to happen in order to attain the other levels.

The other rewards happen through the app and guests receive a notification if they qualify for something to use. As mentioned before, they can be turned off or on as needed. Your options are: a welcome reward for signing up, a happy hour reward (during a set time of day), Facebook checkin, Facebook referral, and Lucky reward (randomly select people after 5th, 10th, or 20th checkin) with a time limit to redeem (i.e. they have to use the reward promptly instead of saving it for when it was convenient.)

Admin Dashboard for Flok

The reward systems are great for both parties involved, but Flok offers some additional features that are a big selling point for me. They offer the same marketing powers as Belly, for example, displaying everyone who is at the Platinum membership level and sending them a message. The difference is you can offer them a separate reward to redeem that can expire in as little as a day or as much as six months. For individuals, you can add punches to their card or change their membership levels. These last features will help Front Desk agents when negotiating with an upset guest at checkout. They may be more willing to take the additional points or other offer instead of a financial discount, and will definitely be a help for anyone travelling on a corporate or government credit card when all the expenses are being paid for.

There are two other features that make Flok interesting. One is a beacon that stays at the Front Desk or entranceway to the hotel. The beacon detects the Flok app on people's phones and send them a "Welcome" message to remind them to punch in. It will also remind them if they have a reward to redeem because of the number of punches they have on the card, randomly selected, or because it's their birthday, if you have those options switched on. The device takes AA batteries and uses Bluetooth to connect, no setting it up to connect to a WiFi network or any other maintenance.

The other feature is a messaging service like Checkmate, which allows for realtime communication between guests and the dashboard, or the owner's phone app. It may not be practical for a large hotel, but for a boutique hotel, it should be an easy service to manage without taking too much time.

One hotel will be implementing Flok next week and I am anxious to see how well guests enjoy it. Pricing starts at only $20 a month (if paying annually), and you can have a free trial to see how the dashboard looks, test it out with staff, and so forth. Definitely check it out.

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