Hotel Loyalty Programs Continue to Prove Their Value: Key findings from 675 million members

Executive Summary

 
Hotel loyalty programs have evolved from frequent-traveler retention tools to broad-based demand drivers. While the growth of loyalty program membership may make it harder to target the most highly valued guests, the 2024 data confirms that hotel loyalty programs remain a relatively cost-efficient way to drive occupancy.

A record 21 brand launches and partnerships in 2024 attracted new guests and a variety of new use cases, driving loyalty program membership and hotel occupancy. Membership surged 14.5% in 2024, outpacing room growth and pushing members per room up by 7.4%.

Average member contribution to occupancy rose to 52.8% but room nights per member dipped. More members are staying, but each one is staying less often, likely due to the influx of credit card members and the dilution of the traditional “road warrior.” The challenge is to convert these “retail” travelers into repeat guests.

Members are redeeming points as fast as they earn them, with liability per member falling by 5.3%. Hotels should focus on maximizing redemptions that fill shoulder seasons and drive ancillary revenue through incentives like food & beverage credits, spa perks and exclusive experiences.

Loyalty fees increased by 4.4% last year, outpacing 2.7% revenue growth, but at just $5.46 per occupied room or 1.6% of total revenues, up from 1.58% in 2023. Overall, program costs remain modest.