Features

Interview with Chris Hartley, CEO of the Global Hotel Alliance

18 Dec 2021 by Tom Otley
Pan Pacific London

The beginning

The Global Hotel Alliance started in 2004 as a business to business partnership bringing together smaller hotel brands such as Kempinski and Pan Pacific to help one another in distribution, technology and sales.

During that time, were you also considering launching a loyalty programme?

Yes. By 2010 it had grown to seven or eight brands and the decision was made to offer a customer loyalty programme called GHA Discovery. We reported on this at the time. The programme started with around one million members, which was the sum total of the different programmes run by the individual hotel brands.

The programme was a success, both in terms of more hotels joining the Alliance, and with more customers signing up to the loyalty programme, but there were worrying signs as well.

One of these was the nature of the GHA Discovery programme, which had always been a recognition and experiential programme which means that, instead of free nights, local experiences were offered such as learning to play traditional Bodu Beru drums in the Maldives, helicopter tours over the LA skyline or backstage access to the Central Moscow’s Circus.

These were popular and had a value from $150 to $350, but were offered only to premium customers – those who had platinum or black status – the top two tiers. What we saw, increasingly, was that other, larger loyalty programmes took note and started offering them as well.

You could see with social media that was the way things were going for redemptions, but while we had started this, we were only rewarding our elite level customers, and that was only four per cent of our membership. What we weren’t offering was the free night programmes, and we would have had to do that to be competitive with Marriott Bonvoy or Accor Live Limitless.

So why not just offer free nights?

I’ll come to that. There was another issue, and that was the consolidation in the hotel industry. Accor bought Rixos and Movenpick, two hotel brands which were part of GHA, and Hyatt bought Alila, and so we could see we were under the threat not only from their big loyalty programmes but because they were acquiring lifestyle brands that were independent and perfect for the GHA Discovery programme.

So we did research in 2019, pre-Covid, and the message we got back from consumers was that the big programmes were very opaque. People didn’t really know what they’d earned, it didn’t seem to be linked with what they’d spent, and when they tried to redeem the points, the hotel programmes yield manage the points so they never really knew what they had.

This was particularly true of customers of the Starwood Preferred Guests (SPG) programme which Marriott had bought and folded into its own programme – Marriott Rewards, which became Marriot Bonvoy.

Ex-SPG customers were especially vitriolic about this, and when we looked at the SPG loyalty programme and the great hotel brands that had been in it and the traction with customers for that programme we thought that we have a similar collection of rich brands such as Capella and Lugano and Tivoli and Anantara and so we ought to be able to do something more.

GHA-Tier-Levels

But no points earning in the new programme?

We didn’t want to do Points since it would create a new system which once again no one would understand and people play games with to gain status, so we looked at other sectors like what worked in the retail and lifestyle sectors. And to take one example from the UK, what customers liked the most was programmes like the Boots Advantage card where you spend money, get credit on your card and can use it against your next spend.

So our intention was to make the programme transparent so you can see what you’re earning and link it to revenue spend, not nights spent in a hotel. If you spend $10,000 in the Maldives you should be rewarded for that. So that’s the Discovery Dollars which we have introduced. And then you can spend ‘at par’, so then we needed to figure out what percentage we should give back on what they’ve spent – and the answer is four to seven percent depending on the tier.

We then said people could spend the currency in hotels. At the moment you can use it on anything such as money off the bill or in the restaurant, but you need to be staying at the hotel. Next year you will be able to spend it on anything and you won’t have to be staying at the hotel, but that’s a technology interface challenge.

And people move up the tiers through spend?

Through spend, yes, but also by staying in more than one of the brands. So if you stay at two brands during a six-month period then you move to Platinum, and if you stay at three you move to Titanium. Titanium members then earn seven per cent on their spend.

GHA experiences

How do people join?

They can do it on the website, but when people check into one of the hotels they can join then and there and will start earning Discovery Dollars immediately, and then that will last for six months and that’s the window for them to stay somewhere else. Your promotional welcome is four per cent regardless of channel, you can book through a OTA – that’s your welcome, and it will expire in six months.

What are your hopes for the programme?

We want people to understand that this is a generous programme. I want people to say ‘They are giving me a very generous seven per cent, or five per cent or whatever depending on the tier, and I can spend the currency immediately.’ Members can go through the tiers by spending money, by staying a lot or by staying at a lot of hotel brands, and then we want people to see that this is better than Marriott Bonvoy because the hotels we have are a richer choice by which I mean these are hotels you would enjoy going to for a holiday as well as business. You can also gift a Titanium card to someone, which we think is generous.

I think it makes us attractive from a hotel point of view and a loyalty point of view, and helps us punch above our weight compared with these massive loyalty programmes we are competing against.

It launched at the beginning of December, how is it going?

It’s going well. We have seven million Discovery dollars already in circulation because we converted those people who had credit in the system already. We have a lot planned – not just being able to spend the currency in, say, a hotel restaurant even when you aren’t staying, but also being able to gift your currency to another user, and giving Discovery Dollars to charities, with each brand having a cause locally. And then we have the NH members, which is another nine millions members to our 11 million joining around April next year, so there’s a lot to look forward to.

Subscribe to Business Traveller UK for a 45% discount and platinum membership of GHA Discovery

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