Guest blog by Mission Group
The hospitality sector has disproportionately suffered the cost-of-living crisis since 2021, causing many industry leaders to revisit the old management maxim that it’s cheaper to keep current customers happy than to find new ones. Increasingly, data-oriented management teams have been interrogating their loyalty programmes in search of new insights and ideas for innovation. And now there’s new research available: a study by Zonal and CGA which asked 5,000 British people their opinions on loyalty in the context of eating and drinking out.
The findings are fascinating, and I hope will help industry leaders get back to basics in their efforts to turn customer KPIs green.
Vision – what’s your brand promise?
The report reveals the diverse range of factors that influence loyalty, emphasising that it can only be achieved by delivering the fundamentals of hospitality consistently over time. At the top of the list, by a substantial margin, is “value for money,” a factor that resonates with nearly half (47%) of all consumers. Importantly, value doesn’t necessarily equate to cheap; it’s about offering quality and satisfaction that align with the price – also known as keeping a ‘brand promise’.
Brand promises make up our rich consumer landscape. For instance, if I go to the local Community Club, I expect a pocket-full of change from my round of drinks in a friendly, local environment – and not much else. When I go to Gordon Ker’s Blacklock I expect a steak dinner experience that blows the local pub away, without forcing me to remortgage at the latest Bank of England interest rate. If I occasionally dare to take my wife to a Michelin Starred restaurant for Valentine’s, I expect the experience to impress her for longer than it takes to subsequently pay down my credit card. You get the idea – my loyalty to these brands is relative to how well they keep the unique brand promises they make to me as a customer – not who’s the cheapest.
It is the leader’s (or leadership team’s) responsibility in a hospitality business to nurture a clear and compelling vision for their brand promise. And, when the vision is clear, it is their further responsibility to ensure that it is shared by all, so that the entire organisation can work coherently to deliver it. In my examples above, it would be no good if half the Blacklock team spent their days cutting costs to match those of a Community Club and the other half worked on a £250 per head Michelin-Star-style tasting menu. That would result in chaos internally and customer confusion (and disappointment) externally.
Traction – delivering your brand promise through each and every employee
Whereas vision is all about getting your team 100% on the same page with where you’re going, traction means actually getting there. This is where most hospitality leadership teams fall down and their companies pay a particularly heavy price for poor employee execution in times of economic uncertainty, when consumer loyalty comes under increased scrutiny.
According to Zonal and CGA’s recent report, 52% of consumers now admit to having higher expectations of the brands they are loyal to. This figure jumps to a remarkable 64% among the 18- to 24-year-old demographic.
Consider a boutique hotel brand, committed to delivering a “home away from home” experience for travellers seeking authentic local encounters. Their vision might be to transform every guest’s stay into a unique story about the locale. To achieve traction for this vision, the hotel might initiate weekly sessions focusing on KPIs like guest feedback on curated local experiences, staff training on regional history and customs, or partnerships with local artisans and businesses. By ensuring that each department’s daily activities actively contribute to crafting these individual guest stories, the hotel can bring its brand vision to life, consistently and effectively.
Healthy relationships – bringing everything together with a customer-centric culture
Even with a clear vision and the right habits for traction, it’s team harmony which forms the real backbone of a thriving hospitality business. And harmony doesn’t simply mean avoiding conflict; it’s about addressing and resolving issues constructively, fostering open communication, and building an environment of trust and mutual respect.
In the case of our boutique hotel, this might mean ensuring that the front desk collaborates seamlessly with housekeeping, that the kitchen and service staff operate in unison, and that every team member feels valued, heard, and empowered.
Great leaders promote the idea of vulnerability-based trust within teams. For example, imagine a further scenario where a chef at our hotel feels comfortable admitting to a mistake in ordering supplies without the fear of retribution. This open admission allows the team to quickly adjust and find solutions. It also fosters an environment where learning and growth are prioritised over blame. When each member of the hotel staff takes ownership of their responsibilities and commitments, the result is a smoother guest experience.
Whether it’s ensuring that a guest’s special request is met or promptly addressing feedback, a healthy team that holds itself accountable ensures that the brand’s promise is consistently delivered and customer loyalty is earned day in day out.
The hospitality industry’s path forward
In conclusion, the hospitality industry’s path forward hinges on the simple yet profound principle of keeping promises. The Zonal and CGA study underscores the need for brands to understand and deliver on what ‘value for money’ truly means to their customers. It’s about aligning every aspect of service with the brand’s core promise, from the boardroom to the front line. As consumer expectations climb, especially among the younger demographic, the margin for error narrows. Authentic experiences, not price wars, are the new battleground for customer loyalty. For leaders in the industry, the mission is clear: cultivate a culture that prioritizes a consistent and genuine delivery of the brand promise. When every employee understands and contributes to this mission, customer loyalty will follow. Let’s not just chase the green on spreadsheets, but foster the kind of loyalty that comes from customers who leave as satisfied storytellers of the unique experiences they’ve had.