In part one I reviewed what the Membership Economy is and how you might be able to use the modal to increase your revenue for good. In part two I am going to outline some of the ideas you can implement in order to take full advantage of the growing trend of a membership economy style business.
Clearing the Jargon
There is a lot of jargon thrown around when talking about the Membership Economy. You can talk about ‘future proof’ or ‘customer-centric’ for example. But what does it all really mean?
Let’s look at ‘future proof’. If your target is to create a business that can head into the future and not be affected by a change in trends, or a lapse in economic strength for example, then you are thinking the right way. This is the essence of ‘future proof’. The idea is to put something together that people will subscribe to and therefore provide you with a continued revenue stream. But what can you do as a hotelier, using your existing hotel, to create this kind of revenue stream?
Making Future Proof, Work For You
So you have a hotel. Traditional working business model. Guests book a room, they eat in your restaurant, they enjoy their stay and hope they go away satisfied. OK, this is a good start. But how can you turn those guests into a continuous revenue stream rather than a one-off?
If you are a single hotel and not a chain or small chain, then your best course of action is through your restaurant. The idea here is that you create a loyalty programme. If a guest comes into your restaurant, with their bill they get a card with a beautifully designed loyalty card, on which they can add points every time they eat at your restaurant.
Simple right? But taking that a step further, you can also join forces with other local businesses. You can talk to places such as beauty salons, spas, theatres or any local business that will allow customers to spend a certain amount to gain ‘points’ that can be put towards a meal or some free drinks for example. Of course, that also works vice versa. They can also spend their points in any of the participating outlets. Although effective, this is nothing more than the age-old ‘loyalty’ model.
Taking It That Step Further
In order to take things further, you have to start to think about how to take the idea into the 21st Century and further into the Membership Economy style of business. Keep the loyalty programme side of the idea, but utilise the tools we all have at our disposal.
Using things such as Instagram and Facebook, you can encourage the same customers to sign up to your page for even more news and upcoming events. When they like your Facebook page and follow you on Instagram, they can gain more points and see all your latest offers.
You can also get them to sign up to receive email newsletters with more offers and ways to gain more points. In terms of staying in your hotel, you may think that as a single hotel you have no weight in the world of loyalty programmes. Wrong. Join forces with other hotels in the area and see how you can come together to create a local market that engages their guests through various media and ‘rewards’ them by offering them special deals if they sign up and even pay a small monthly fee to gain access to constant discount prices and special offers that they can only get by joining your ‘community’. With this kind of model, you will find more and more guests returning and therefore giving you a more ‘future proof’ revenue stream.
Engage and Delight
By allowing your guests, whether staying in your hotel or eating in your restaurant, the chance to be part of something, you fill the void mentioned in part 1. We all have a desire, a need, to be part of something bigger than ourselves. However, in order to really engage your customers, you need to look for their feedback. Give them a platform in which they can comment on ideas you have for future events. Allow them to interact with you as a company on as many levels as possible.
The best way to secure a revenue from this is to make it a subscription service. People pay a monthly, set price fee, and they can have access to cheaper prices, special offers, discounts, not only with you but also with other local businesses that have agreed to be part of the programme. Sure this means sharing the revenue stream, but better to share than not have it all right?
The more ‘benefits’ you can offer them the better. Add this to the fact that you can rope other businesses into the same programme and you will have a constant stream of income, from your local community. At the same time, you will also increase local awareness of your business which means free marketing. Free to you, but a cost to your guest, therefore making marketing your business a profit for you too!
Learn From the Big Boys
If you take a look at the big fish in the Hotelier world, IHG, Marriott etc, you will see that they have been engaged in the idea for a long time. Of course, it is easier for them to be able to do it due to their size and reach but think big. There is nothing to stop you contacting other hotels in other countries and forming a loyalty and rewards scheme with them.
That way, when your subscribers want to travel to Spain or Italy or even as far-flung as Asia or Latin America, they can apply their collected points to the costs of their holidays elsewhere.
By allowing them to use their points in as many places as possible you also increase the size of the net in terms of your customer base. Customers local to the areas you target can also use their points when they come to you. This kind of collaboration is taking the strength of having a globally recognised brand and applying it to smaller individual brands.
Create A Family
This is exactly how you need to start to see it. Look at what you are creating as one big family. That sense of belonging that I mentioned earlier is a powerful tool. When people feel they are gaining something of real value to them, by paying you a subscription fee, and they are buying in to being part of that ‘family’, then they will not care about the small amount of money they pay per month to be a part of that family.
You can also create a revenue stream through advertising. Target your adverts through newsletters and email marketing, Facebook posts and Instagram and you give yourself a real opportunity to keep that revenue stream going and allowing yourself the peace of mind of knowing that no matter what happens you will always have a continuous income and a stronger peace of mind.
By joining forces with other businesses not only locally but also internationally, you also create a family of your own. Other people that you can meet with and discuss ideas. Share the responsibility of maintaining what you are building. This will also give you a sense of belonging and also the sense that you have other people to turn to when you feel like you are drawing a blank on your next move.
Not So Easy
Of course, none of what I have just mentioned comes easily. If you wanted easy, get a salaried job where you don’t really need to think. None of us started working in hospitality because it was easy. In fact, hospitality is one of the hardest industries, in my opinion, to work in. Constant stress, working all the hours under the sun to keep things going. When I last had a lease on a pub just outside of London, I was working 7 days a week and what felt like 24 hours a day. We do it because we love to provide an experience for people that they will never forget. Give them a place to stay or food to eat that they will want to come back to and try again.
It takes a lot of hard work to do all the things I have mentioned above. Once in place though, it is the kind of business model that will work for you and keep your revenue stream strong without you doing all that much at all. Yes, it will take hard work to get there and a lot of hours of talking to people on the phone and arranging things to give your loyalty base what they expect, but that is the point. Hard work now, easy life later. After all, that’s what we all want right?