The impact of point policies on hotel “sleeping” guests: awakening model construction

Abstract

Purpose

The conventional customer lifecycle fails to acknowledge the “sleeping” stage between regular patronage and churn, particularly prevalent in the hospitality industry. This study constructs an awakening model to regain “sleeping” guests.

Design/methodology/approach

342 questionnaires from Macau using partial least squares-structural equation modeling (PLS-SEM) were analyzed. The model was compared across different membership levels through multigroup analysis.

Findings

The results indicate that the point policy can awaken “sleeping” guests by influencing their perceived value, regret, and integrated satisfaction with a shorter “sleeping” period. Two path coefficients showed significant differences among basic and elite members.

Practical implications

Companies with loyalty programs should implement a transitional period before resetting points, leveraging altruistic point policies to awaken “sleeping” guests via direct communication. This strategy mitigates the negative impact of finite point expiration policies, enhancing customer re-engagement and point utilization.

Originality/value

Our study focuses on a crucial facet of hotel marketing—customer regain strategies. By identifying customer segments who have not revisited the hotel group for more than twelve months, we confirm the concept of “sleeping” guests. This term offers a nuanced perspective, distinguishing “sleeping” guests from generic lost customers. The “sleeping” guest segment provides valuable insights for enhancing targeted and effective marketing activities in the highly competitive hotel industry.

Citation

Liu, W., Guo, K. and Gao, B.W. (2024), "The impact of point policies on hotel “sleeping” guests: awakening model construction", Journal of Hospitality and Tourism Insights, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JHTI-04-2024-0303