Lauren Platero

6 Guest Retention Strategies to Boost Hospitality Profits

So you have an appealing brand and customers frequent your business. But, you’re trying to determine how to establish excellent customer service, constant growth opportunities, and a sense of loyalty. 

That’s where guest retention strategies come into play. Customer retention strategies are actionable plans that help promote consistent sales. Over time, such strategies will help maintain profitability within a business. 

Guest Retention Definition 

Guest retention refers to the long term loyalty present between a customer and a brand. Guest retention comes after lead generation and customer acquisition. It’s important to note that guest retention is responsible for the financial health and future of a business.

Want to learn about guest retention strategies in the hospitality space? We’ve got you covered! Read on to learn more!

Guest Retention Strategies 

Guest retention is important for the long term profitability of a business. By constantly serving brand new customers, businesses can run the risk of losing retention over time. 

The inability to retain guests can lead to unpredictable sales trends and false projections. As one can imagine, guest retention strategies are vital to the stability and longevity of a business. So without further ado, here are six guest retention strategies that can improve hospitality profits. 

1. Provide Exceptional Service 

Customer service is the most important contributor of guest retention. A business can implement as many features, products, and services as they’d like, but if the staff fails at delivering stellar service, the customer experience won’t encourage guests to come back. 

Providing great customer service can look different depending on the business. Common examples include: timely food service, clean rooms, a friendly wait staff, quick response times, and more. 

So you might be wondering how a business owner can promise great customer service. It all boils down to the team members you hire and the training you give them. Put an emphasis on service and attentiveness during the hiring process and training sessions. 

Also be sure to hire professionals who value great customer service. Ask the right restaurant interview questions and call professional references to help confirm these details.

2. Send Enticing Emails 

An email marketing strategy is a guest retention tactic for numerous reasons. For one, it’s a direct way to stay in contact with your customers. Promotional campaigns and discounts can be sent on a regular basis, as persuades existing customers to return. 

Email campaigns are also useful for keeping your business memorable. When consumers contemplate which hotel, restaurant, or resort they’d like to visit, you want to ensure that yours comes to mind. An easy and cost-effective way to do this is by sending email newsletters.

Just ensure that your email communications are sent to the proper segments, at the right times, and are not too frequent. Bombarding inboxes with similar messages can cause adverse effects. It’s a time-consuming task to build an email list, so you want to make an effort to avoid losing subscribers. 

3. Create a Loyalty Program 

Guest retention strategies are all about making a brand more attractive than competitors. A proven way to do this within any industry is to create an exciting customer rewards program

Upon every purchase, allow customers to earn a point for every dollar. To make the process much simpler, store all of this information in a POS system. Using an all-inclusive tech solution will also help streamline restaurant operations and eliminate paper products. 

Hospitality rewards programs can be more than just a restaurant loyalty program. Businesses like casinos, cruise ships, and country clubs can all benefit from this type of product. 

4. Consider Customer Feedback

Customer reviews will always help influence positive changes within a business. If you want to retain customers, you need to know how to keep them happy. 

There are so many micro aspects of business operations, that a hospitality or restaurant manager can overlook various issues. By keeping up with customer feedback, staff members can address negative situations and strategize accordingly. 

Always remember that consumers “vote with their wallets.” This phrase refers to the idea that customers can choose which brands stay in business by being selective on where they spend their money. So in order to continuously generate revenue, maintain a brand that consumers are willing to invest in. 

5. Offer High-Quality Products 

Within the hospitality industry, there are multiple businesses within each category. For instance, every major city has a variety of hotels. It’s also quite difficult to find a town that doesn’t have a ton of restaurants. With this in mind, you want to ensure that your business can offer better products. 

Depending on the kind of business you own, a great product line can look different from one to the next. In hotels and cruise ships, you might want to implement state of the art in room dining technology. In an eatery, you may want to use a restaurant inventory management app to always have the freshest ingredients on hand. 

Product differentiation is essential for rising above local competition. Not only can it help provide customers with a better experience, but it can keep your business entity memorable for each visitor. 

6. Give a Discounts With Each Receipt 

One-off discounts can provoke customers to return. However, standard promotions might not retain customers over time. Instead, implement an ongoing promotional campaign.

Consider the following strategy for inspiration:

Check your POS system to find the average cart value for each customer or party. Then, decide on a discount that you’ll give out upon each purchase equal to or higher than that cart value. For example, for every $50 that a customer spends, give them a coupon for $10 off their next purchase. 

What this technique does is create a guest retention cycle. As guests return to use their new coupon, they’ll likely get another one–and so the purchasing habits continue. 

Not only are the customers constantly getting rewarded for visiting your business, but there’s always an incentive to come back. Since guest retention strategies are all about returning customers, this strategy will likely benefit your business. 

Frequently Asked Questions About Guest Retention

Guest retention strategies are vital across the entire hospitality industry. If you’d like to learn more about how businesses can grow and retain a customer base, check out our brief recap below!

What Are Guest Retention Examples? 

A few examples of guest retention include:

  • A discount for returning customers 
  • Extra loyalty points for existing customers
  • Access to join a subscription model 

Why Is Guest Retention Important? 

Guest retention is important since it helps maintain profitability for a business. When a brand can maintain a customer base, they’re able to better project financial metrics, stock inventory, and develop realistic strategies. 

What Is a Customer Retention Strategy? 

A customer retention strategy is a plan of action that a company implements to sustain a customer base over time. Customer retention strategies aim to enhance brand loyalty and the customer lifetime value. 

What Causes Customer Retention? 

Customer retention traces back to the ability to maintain positive relationships with customers. Brand loyalty serves as the foundation for customer retention, so it’s vital that companies provide guests with a sense of belonging and exclusivity. 

How Do You Build Guest Retention?

A company can build guest retention by encouraging customers to return time and time again. More strategically, brands can implement customer rewards programs, utilize customer feedback, host memorable events, and more.