Name: Kamar Raja (2008 -2010)

Title: Effectiveness of Loyalty Programs in Hotel Industry


Executive Summary

The project is all about effectiveness of loyalty program in hotel industry. This paper, exploratory in nature, attempts to provide a conceptual overview of Loyalty in service sector, outlines practices of hotels in Delhi. It also throws light on consumer expectations, perceptions through in depth exploration. Based on literature review and environment in India, an emerging economy, it attempts to predict future of such programmes specifically in Indian Hotel industry. The main objective of this project is to find out the effectiveness of loyalty programme in hotels. And the sub objectives are as follows

  1. Acknowledge the parameters of loyalty programs
  2. Customer perception of those parameters
  3. Studying the Relationship between customer satisfaction and loyalty
  4. How much satisfied are the customers with the loyalty program


The Research methodology used for this project is that I have used descriptive research and the data has been collected by secondary method with the help of Articles Newspapers, Journals etc and by primary method with the help of questionnaires. The area of my survey was Hotel Samrat and the total numbers of respondents were 50.The major part of learning in this project has been the nuances of loyalty programmes what works and what not, consumer motivation perception about loyalty programmes. Success tricks for loyalty programmes were also the part of learning.

Loyalty programs have been extensively used to enhance customer loyalty. Despite the rapid growth of the programs, its effectiveness in boosting customer loyalty is still questionable. The programs are only able to encourage customers to repeatedly purchase without having emotional attachment and personal relationship to the companies. As acquiring new customers is getting costlier day by day, business organizations have offered continuity/loyalty programmes to retain/reward existing customers and maintain relationships. Consumers find it beneficial to join such programmes to earn rewards for staying loyal.

The data through questionnaire has been taken to analyze that the customers going to hotels have loyalty card or not and since when they are using it. It is also analyzed that how important is reservation through E_ticketing,IVR.The importance of facilities like medical service,24 Hour front Desk Service, internet& tour currency exchange has been tried to find out. Customer Service, Discounts and offers also plays important role in selecting the hotel.

Different type of loyalty programmes and its features has been elaborated in detail. It has also been tried to be known that who is the target profile for these hotels and what is the effect of these loyalty programmes on the sales of the hotel. Few important facts about consumer attitude towards loyalty programme, benefits of loyalty programme and different loyalty programme running in different industries has been included. The overview of the hotel industry has been put along with classification of hotels and techniques of awarding grade to the hotels.



To find out the effectiveness of loyalty program in hotels

Sub Objectives:

  1. To find out the effectiveness of loyalty programs
  2. Acknowledge the parameters of loyalty programs
  3. Customer perception of those parameters
  4. How much satisfied are the customers with the loyalty program



On the basis of the data analysis, findings and articles so collected during the course of

Project the following recommendations which I would like to give:

  • Those hotels who were implementing the Loyalty Programs should keep in mind

the customer and his expectation & needs out of the Loyalty Program.

  • The Loyalty Program must be customized according to the needs of the customer.
  • According to the data analysis and findings of the project it has been found that Customer service, Guaranteed reservation and e_ticketing were the factors which

customer prefer a most so a Loyalty Program must provide all these benefits

to the customer.

  • The focus of a Loyalty Program should be on providing excellent service to the

customer rather then making profits.


The following are the limitations of the project:

  1. Time constraints turned out to be a major limitation.
  2. It is difficult to gather primary data through questionnaire because many respondents were not ready to read and not gave good response due to time shortage.


The above article was extracted from dissertations in Marketing, Finance, Human Resources, Strategy, Information Systems by the students from Skyline College. Skyline College is amongst the top MBA and BBA institutes in Delhi, Gurgaon (NCR).

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