Tuesday, May 18, 2010

Brand Loyalty - Dead or Alive?

No, it’s not a wanted poster, just one person’s perspective.

I mentioned in a recent post that I opened a new Hotel earlier this year, in the highly competitive Vancouver marketplace, an unbranded Hotel.

I recommended that we open unbranded as I had seriously questioned the value of the brands available in the market, relative to the fees and other associated costs attributable to those same brands, and, the lack of control and individuality if the Hotel was to be branded.

That, and I believed, as I do now, that for the vast majority of consumers, brand loyalty, when it comes to Hotels, is dead, or at the very least, on life support.

Think about it, what do you do when you want to travel somewhere? If you are like the dominant percentage of people who spend most of their day in front of a computer, for one reason or another, you search the web.

You go to Expedia, or Travelocity, or perhaps Kayak, and you begin your search. Why? Because it has become chic to boast about what a great deal you found, for airfare, for hotels, all-inclusive, it doesn’t matter.

Sure, there is still that small percentage of people out there with buckets of money, who could care less how much they paid, but that small percentage, is getting even smaller, because even the wealthy like to brag about the deal they got. Let’s face it, the rich didn’t get rich being stupid.

Saving money, or getting a better deal than the guy next to you, got to be cool somewhere along the line, and in that scenario, brand takes a back seat every time.

Sure, if the price is close, and you have stayed with a certain brand before, or maybe you are in their rewards program, you are going to choose to stay with them, no argument. And if your travel is frequent enough, and you have negotiated a great rate at your favourite spots, and with your favourite brand, you are going to stay there.

But what about everybody else? They’re gone, to where they get the better deal. Hotels, or at least at a certain level, ALL have great beds now, they all have the best toys in their rooms, and on and on, and the consumer knows it, and, what’s worse, the consumer now KNOWS they’re in the drivers seat.

That’s why Hotel companies are always trying to out do each other, capture the latest trend, anything that might differentiate them from their competitors, and maybe, just maybe, give the consumer a reason to actively pick them for that next stay, and, be willing to pay just a few more dollars to do so.

The irony is that there are still some brands out there who know that this happens, but they have their heads buried in the sand, waiting for this trend to change, and change it will, but not the way they want. This is here to stay, or more accurately, it will only get worse as the internet becomes more available, in more ways, to more users. Time to wake up and smell the coffee.

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