#527: Leaders in Customer Loyalty: Brand Stories | How Wyndham Hotels & Resorts is building customer loyalty beyond hotel stays

Good afternoon, good morning. Mark Johnson from Loyalty360. As we know, travel and hospitality loyalty programs are having a moment. They are simplifying experiences, refocusing on customer value, and redefining customer engagement.

One brand leading that shift is Wyndham Hotels and Resorts, from easy free night redemptions to an industry-leading subscription model. Today, we're joined by Michael Schuden, Group Vice President of Integrated Brand Marketing, Loyalty, and Digital at Wyndham Hotels and Resorts. He's going to take us through the process of keeping the program relevant, fresh, and driving it to new heights. Welcome, Michael.

How are you doing today? Very good. Thanks for having me, Mark. Absolutely.

So for those who may not be familiar, can you give us a little introduction to Wyndham? You know, what you guys do, how you do it, how was the company founded? Sure. So Windham Hotels and Resorts was actually founded uh back in 1981 by Tram Crow.

Uh today, fast forward uh almost four decades or so, uh, we're the world's largest hotel franchising company with over 8,000 properties across 100 countries and over 20, 20 brands across the world. Interesting. And you you look at uh the tribal hospitality industry, very competitive right now. Uh new brands, new uh Bluetooth hotels kind of popping up all the time.

You know, what do you see as the keys to the great success that Wyndham has had? Yeah, you know, for us, for us, we it's almost three key areas that we focus on. One, uh, you heard a lot from our CEO, our owner first uh approach is such a key pillar to our success, providing our franchisees with industry-leading technology, as well as our massive scale drives efficiencies across their business model to maximize their profitability as our franchisees. Uh, second is really being laser focused on the consumer.

Um, for us, our key focus is on that everyday traveler. And by facilitating a brand architecture that speaks to them uh across uh across their array of uh life cycles within with it as an individual. And so whether you're looking for a road trip and staying at one of our super rates across the country or days ins to celebrating that wedding anniversary at a Wyndham Grand uh or a registry collection in the Caribbean. We hear a good deal, uh you know, we have a number of hotel groups that are part of multi 360.

What is, can you define what an everyday traveler is? And I think it's something that uh it comes up defining different groups of hotels. You know, what is that? Yeah, so our bread and butter in the US specifically is truly our economy and mid-scale brands.

And so when you think about bringing those brands to life, it's a days in Super 8, Laquinta, uh, Wingate, and Microtel. And when we think about who those customers are, it truly is the blue and gray collar workforce. And so those are the utility workers that are traveling, the traveling nurses of the country. And so how we bring them and build a resilience uh to and emotional connection to our brand, uh, and then layering on top our award-winning loyalty program and win and rewards in its simple and generous uh structure that really drives the most valuable uh opportunities to take that business trip and translate it into a four or five-star resort stay in an aspirational hotel across the world, like a registry collection in Greece.

So, Michael, when you look at your role at Windham, uh, can you tell us a little bit about your role, what you do day to day, and you know, what led to being in the customer loyalty, customer experience industry? Yeah, sure. So I've been at Windham for close to five years now. Um, August this year would make five years.

Uh, in my current capacity leading marketing, loyalty, and digital, uh, that actually just occurred about two months ago or so. So relatively new. I've led loyalty for about two years and digital for about three of my five years here. Uh, and really this started as uh two years ago, we we formed a commercial organization and we found tremendous synergies in tying the business traditional business side with the tech uh tech side of the business.

And so uh part of my remit and my team's remit is also to co-spear our Martech innovation and strategy. And so what that has allowed us to do is really fine-tune our priorities as a company to really put the consumer value and consumer experience first. And in turn, what we've seen is just tremendous results in return to our franchisees in terms of driving direct business to their hotels. Okay.

When you look at your role at Wyndham, uh you have a growing role, uh different areas of responsibility. When you look at that, uh you've talked to us a little bit about kind of what you do. You know, what are some of the biggest challenges you face, or maybe in the opportunities you see uh within your role uh for the organization? Yeah, you know, I think I think the biggest challenge is probably very common regardless of what industry uh you're in, uh, which is uh the marketing, marketing budgets continue to tighten.

And so how do you continue to drive value through your loyalty program and through your brand voice for the consumer? Uh and for us, we look at it, especially here at Wyndham. I think what really separates us from our competition is how much we lean into leveraging technology and innovation to drive those efficiencies. And so whether we're partnering with uh platforms like Adobe to truly start to tailor and differentiate how we speak to each of our customers to ensure that they don't just feel as if we're talking to them as a guest, but we're talking to them as a loyal member uh in a two-way reciprocal relationship with the brand.

Okay. Excellent. And as you know, technology can be a pretty significant challenge for brands, understanding what's working, what's not working. Uh, you know, are there some technologies that that you guys are looking at or leveraging right now that are helping increase that relevance and impact of kind of your customer experience and customer loyalty efforts?

Yeah, I think I think a couple of areas. So one, it I don't think we could talk about technology without talking about AI. Uh, and so really leaning into how do we leverage LLMs and decision engines to uh one, find uh efficiency opportunities in our marketing spend, but also two, to leverage it also on the creative side. How do we 10x, 100x, our variants in market to truly tailor one-to-one experiences for our 124 million members across the world?

Um, and that's really shown incredible results in turn in the tunes of you know double digit gain from a ROAS perspective, as well as double digit gain for cohorts of our member base in terms of uh 12-month future value as well. Okay. Uh, when you look at your industry, uh great deal of change in many industries right now. The industry, customers, how people are changing.

There's been a pretty interesting discussion recently amongst our community of again, where does hospitality start? Um, does it start online? Does it start in the, you know, when people check in? You know, how do you see your customers and industry changing?

And, you know, how may you be responding to some of those changes? Yeah, I think very similar to other industries, it's it's really about the shift from traditional offline marketing into digital experiences. And so uh we've really been leaning more and more into social and truly creating a community through a digital lens. Uh, and you know, whether it's tapping into influencers, but also actively engaging within the digital community and digital platforms to drive that two-way relationship first.

Uh, you know, the first way to drive the uh long tail uh value for a guest is not just to have transactional touch points, but truly find value in between those hotel stays. And that's something that we've been leaning into as we start to build out a much more layered and mature loyalty ecosystem, as I call it, of partners to drive that everyday value. Excellent. And when customer loyalty, uh one of the great things we get to do as part of Bullet360 is talk to program leaders like you, industry uh leaders that are doing very unique things in customer loyalty, customer experience, but at the core of it is customer loyalty, right?

So when you look at customer loyalty, what does customer loyalty mean to you and to Wyndham? Yeah, to me, it's all about reciprocity, right? Uh if a company or a business model really looks at loyalty as a one-way uh utility equation, to me, that ultimately fails after two, three years. For us, what we try to do is think every day, how do we drive and maximize the value we're bringing through the winner rewards lens uh to our members?

And so uh whether that's our latest partnerships with Madison Square Garden and Live Nation, you may tap into the value of going into a Harry Styles concert this summer at MSG as an example as a local resident in New York, but it gives the utility and the incentive to continue to stay at our hotels with our franchisees to build those point bases so that you can go on to Winner Awards experiences and ultimately book that uh once-in-a-lifetime opportunity to stay at a suite during a Harry Siles concert as an example.

Yeah. And when you look at uh the customer loyalty program, uh you talked about kind of marketing budgets being stretched, cut, uh, everyone's trying to do more with less. Uh, prioritization of a customer loyalty program process is very important. And and I know traditionally you guys have done a very solid job with making sure that it's uh prioritized within the organization.

And you know, how is the program currently prioritized within the organization and how important is it? Yeah, loyalty is truly the bread and butter of everything we do from a marketing perspective. And so uh we we internally call it a blue thread, but it truly is threaded throughout all of our brand architecture, how we speak to our customers and the value we bring, whether you're a Super 8 loyalist or a Wyndham, Wyndham Grand loyalist, uh at, you know, staying at 300, 400 plus ADR hotels a night.

And so for us, you know, I think there's the consumer marketing piece, but just as important, it's also the relationship with your internal stakeholders. And so building the one trust uh and long-term partnership with uh finance and other uh corporate uh functional colleagues across the organization, so important to drive the value of investing into your members who ultimately are driving the majority of your direct business to your franchisees. Okay. And you know, what are some of the keys to that strong internal support and the organizational alignment that you have?

Yeah, I think twofold. One, uh creating a level of transparency in everything we do from a marketing strategy and loyalty strategy perspective. Uh, and two, aligning upfront on how you're measuring those goals. Um, when we think about direct response media as an example, uh, and driving uh that lower funnel to our sites as an example, very uh measurable and highly uh scientific, if you will.

However, when you get into upper funnel, align having those upfront alignment discussions of how are you going to measure the success of a TV campaign or a sponsorship, uh, once you establish that upfront alignment, it really then becomes a much easier process to sustain the importance of a loyalty program as you move forward. Yeah, absolutely. You know, we mentioned earlier this big discussion we've had around hospitality, where does it start? Uh, but also a big uh area of discussion is customer choice, right?

Obviously, customer multi programs are a great uh attribute or uh, you know, internally to keep people engaged, to keep them in the program. You know, how do you get customers to choose your brand, especially some people may be making last-minute decisions, right? Or they may be getting a recommendation or referred from an OTA. Uh, you know, you know, how do you get customers to choose their the brand?

I think this is the perfect example of where marketing and technology really can drive true innovation in value creation for the business. And so uh for us, we look at customer segmentation and cohorts that really allows us to look at look-alike models to identify is Mark Johnson a value seeker? And in that case, the leading message may be the value that Winom Awards can bring to you. Um, if you're not, it truly is bringing the value of each of our 20 plus brands and getting that message in front of you to truly uh to speak to your needs and want for that upcoming uh hotel stay.

And I think by diversifying that messaging and then leveraging technology to create the multivariant opportunities in market, it really allows us to widen our funnel. And then once you do come through the doors of our hotels, really focusing on the in-stay experience and then follow-on touch points to drive everyday value through our partnerships. Absolutely. And when you get them to choose your brand, one of the, you know, the multiple uh brands that you have within the portfolio, you know, how do you then convert?

Uh, you know, what's the key to success there? Yeah, so it's twofold. Uh one, our our Windham Rewards program being uh the most generous and simplistic uh loyalty program in the industry, truly driving that message home of why it matters and what's the incentive to booking a uh days-in uh hotel stay versus one of our competitors, I think it goes a long way. We are uh a loyalty program with the fastest means to getting a uh redemption opportunity in the industry.

In fact, if you stay even at our lowest-rated hotel uh in our global portfolio, you immediately get an opportunity to get a partial redemption on your next day. No other hotel program can say that with confidence. Uh and those types of messages showing the value that uh comes with booking direct on on WindhamHotels.com or one of our digital sites truly allows us to maximize our conversion opportunity once they hit our sites.

Excellent. And when you look at uh consumer choice and conversion, uh it's as I said, something that we're hearing more and more about. Do you think that's something that we should be focusing on uh as an industry? You know, getting people to not only uh choose, but convert.

Yeah, I I think as technology continues to mature and accelerate that maturation, uh the democratization of brands uh truly is going to be front and center for all businesses. And so there's a lot of speak on how does LLMs ultimately change the consumer purchase history or journey, if you will, uh, regardless of hotels or retail. And I think a big part of that is truly understanding uh and breaking down the nuances of how consumers differ in that uh purchase journey. And I think the more brand context and more brand touch points you can have outside of that purchase uh uh cycle, the more opportunity you'll have to ultimately be top of mind and still push that consumer, whether first time or repeat, uh, back into your brands of uh your portfolio of brands.

Okay. You talked a little bit about brand-brand partnerships. Uh, another uh great area of interest, especially if you can get them right. There are challenges to uh not only getting a partnership running, but to getting them right.

Uh and I know you have a number of great partnerships. One going back all the way to your uh casino partnership, which we helped facilitate a number of years back. Yeah. Uh, you know, what is the key to success uh in your customer loyalty program partnership?

How do you get them to work and how important are they to Windows? Yeah, so partnerships, in our opinion, is such a core pillar of driving continued uh and enhanced value to joining our Windows Awards program. Uh Caesars is a great example of that. Of Caesars was a such a good complement to our portfolio of hotels, where it is truly a unique experience of staying at a casino, getting world-class entertainment in Vegas and any one of their other regional uh sites across the country.

Uh, but two, also the reciprocal nature of status match into Caesar's rewards and and uh and Wyndham rewards and points transfers as well. And so that's a perfect example of how it complements our hotel portfolio. Uh, and then you look at uh our recent partnership with Live Nation and Madison Square Garden, sports and live entertainment is one of the fastest growing reasons to travel. And we hear it from our internal uh member focus groups as well, that they are looking for more opportunities to uh achieve that next live event.

And so by creating the brand partnerships that truly meet the affinities of our guests, we are now able to speak and have relevant conversations with our members, not just during that hotel stay cycle, but truly on an everyday basis. That makes perfect sense. When you look at uh kind of building out your uh brand partnership strategy, you talked about some of the successes you had, Caesars, uh, you know, the Madison Square Garden, kind of the those opportunities, you know, how has it impacted the success of the overall loyalty program?

And you know, maybe what's your vision going forward? Yeah, you know, I think for us, what how we measure success of a partnership is twofold. One, uh continuing to understand uh our existing members, are we seeing more engagement? And we measure that by uh repeat stay rate, share of wallet, as well as uh your revenue contribution into our franchisee system or our portfolio of hotels.

Uh the in addition to that, what we're also looking at is how do we how do we continue to widen the funnel and leverage those partnerships to reach a potential audience that may have never considered our portfolio of hotels before. And uh our perfect example of that is as we launched our our partnership with Live Nation and started to mix in cultural events as well. Austin Food and Wine Festival is a perfect example of that. What we've noticed is our funnel of audience uh from that one event started to widen significantly uh in terms of who's engaging with Windham Rewards experiences.

We're driving double-digit improvements in terms of our credit card holders, uh, of leaning into additional hotel stays, but also incremental uh card spend as well because of experiences like this. And so uh truly starts to build the value chain for our consumers, which in turn uh the reciprocal nature of that equation is is uh spending more direct business with our franchisees. Makes perfect sense. Uh your premium program, your subscription program, new, uh very unique to the uh, you know, the hospitality, the hotel industry.

Uh, I think you were the first one to do it. And when you look at the subscription loyalty program, you know, what was the you know, the genesis behind that? And, you know, how does it differ or potentially add value to your loyalty program? Yeah, Insider is something that we're incredibly excited about of what that will bring in the future.

Uh so Insider is the the industry's first uh subscription-based travel, uh, travel subscription program. And what that means is that uh while some of our other competitors do have subscription programs, the benefits are truly centered around the hotel stay and the hotel ecosystem. For us, what we're providing to our insiders is all of the incredible benefits from a hotel stay perspective, but also the extension uh across travel partners across the board. So whether it's airline partners and pricing discounts, uh continued enriched discounts with Viatur, which is our tour and uh activities partner, uh, as well as car rentals, access to digital concierge that can go out and book uh hard-to-get Michelin star restaurants for you, or if you're having a hard time getting those tickets for the World Cup later this year, they'll go out and do the search and offer opportunities for you to uh get access to those hard, hard-to-reach events as well.

And so the bringing the accessibility of what was once a far, far-reaching type of services at just a very affordable $95 price point a year is something that one is true to our mission, our company Midget, of making travel accessible to all. And also, two, goes back to our core focus of winner rewards, which is the generosity that we want to provide to our members as well. Okay. Um, when you look at uh emotional loyalty, uh very important to customer experience, customer loyalty, especially in kind of the economic environment we are now.

You know, do you believe you have emotionally loyal to customers? And uh, you know, uh how do you know? Yeah. So I think emotional loyalty, uh, very hard to quantify on a spreadsheet.

Uh, what you can, how you can measure it, in our opinion, is the uh amount of engagement that. Do you have. And when a member becomes a brand champion, uh, whether it's across social platforms or to their family and friends, that truly is emotional loyalty because they are now a brand ambassador. And that to us is the north star of any emotional loyalty goal for all of our members.

Uh, experiences is a huge aspect of that because you're no longer a transactional means to a consumer of staying at a hotel because you may have had a long, a long business trip uh drive home. And so you're staying and pulling over at a day's in. But now it's also about the ability to create the family moments at a hojo, uh, Howard Johnson, uh, who just celebrated their 100th anniversary uh last year as a brand. Um, or uh celebrating your your 50th uh wedding anniversary at a uh Hodges Bay or HQ registry collection in Antigua.

Uh, I think facilitating and becoming the mechanism to have those meaningful moments in your life is truly what then extends into that emotional loyalty category. Okay. We touched on a little bit earlier, you know, AI is all the focus right now. It's interesting because we've seen a pretty big shift in uh the community on the in the brand side, as we talked about AI last year.

Very restrained, want to make sure they had uh kind of process, they were uh covered from a compliance perspective, legal perspective, but now it's definitely starting to warm up and brands are starting to move beyond just uh you know the uh reporting and the the analytics and the inside and the backside, more customized and tailored messaging. You know, how are you looking at AI from a brand perspective? Yeah, I think AI allows us to just enhance and multiply our productivity as a brand and so uh and tailor those messages as we talked about earlier.

And so uh we're leveraging AI across most facets of our marketing uh today, whether it's at the top from a creative production standpoint, um, in order to expand the variant of content that we have to leveraging those AI uh decision engines to optimize paid media spend, social uh spend as well. Uh and then on our own channels, we're we're testing right now into search AI capabilities through LLMs. We're looking at copy optimization uh engines through email and SMS. So uh to your point, Mark, dabbling a little bit across the board, seeing what works uh and where we can continue to refine and lean into.

I think the important piece for us, though, was a focus on getting your data foundations right, right? Uh no matter how shiny of an object AI is, if you don't have your data in order, you're gonna leave value on the table. And so we're trying to take the front-end aspect or the consumer-facing uh aspect of AI as uh responsibly slow while we continue to layer on the strong foundation of data that and first-party data to really accelerate once we're ready to press the gas, if you will, on some of those AI decision engines.

Okay. And when you look at uh some of the opportunities you're looking at, how do you think AI will enhance your customer experience, customer morality efforts? Yeah, I think it's it goes back to the one-to-one personalization goal that we all talk about, right? Um, but incredibly hard to achieve, uh, especially when you start looking at it at an omnichannel level.

Uh, if you look at channel specific uh maturation for one-to-one personalization, I think many of us feel really strongly on brand.com as an example. But to truly tie one-to-one consistent tone of voice uh across all channels from voice to brand.com to instay, I think that's where you're going to see uh a tremendous acceleration of brand capabilities and something we're keenly focused on.

And I think that's also where there's tremendous value for all businesses in terms of driving that emotional loyalty uh because of the consistency of that relationship, if you will, throughout the lifecycle of the consumer. Okay. You know, what what's next for Wyndham in your customer experience, customer loyalty journey? Yeah, I think it's twofold.

So, one, we're gonna continue to lean into driving a maturing loyalty ecosystem. It gives us uh, you know, continued uh differentiation and cons uh consistent means to have an ongoing conversation in and outside of a hotel stay. Uh the second piece though is with those partnerships, also allows us to truly build a maturing data foundation of who that consumer is or who that member is. And so that then creates a flywheel of how we can tailor our messages, you leveraging some of our AI toolkits in our tech uh in our tech stack.

Okay, excellent. And when you sit back uh and look at your your stay, your time at Windham, uh, and you look at the loyalty program, you know, what are two or three things that you're most proud of uh when you look back uh at the evolution of the program? Yeah, uh, you know, I've we've I've taken over the loyalty program about two years ago. In those short two years, uh one, we've drawn we've driven all-time highs in terms of loyalty occupancy, which is a core value uh and reason for franchisees to join our system.

Um, that direct business is the most efficient uh booking for their for their business model and ultimately driving most profitability for our owners. I think from a consumer perspective, uh, we have expanded our partnershipship ecosystem while being able to maintain the generosity of Windham Rewards and the simplistic nature of it at a time where every loyalty program in our industry has uh frequent uh devaluations to their loyalty program in a significant way. And for us, being able to hold on to that core pillar of generosity while adding tremendous value through these partnerships like uh Viator, Madison Square Garden, Minor League Baseball, and so on and so forth, uh, I think is something that one, the team should be proud about uh because we're seeing it in the proof of the pudding of our members are engaging with us more, staying with us more, which ultimately is the you know the metrics that show that we are building emotional loyalty for our consumers.

And last, you know, last question, a little bit self-serving. You know, what can multi-360 do to help you and your team and your customer multi-journey? Yeah, part of our success over the last two years is continuing to look across all industries for opportunities to enhance our our loyalty system, right? Uh, you know, the best way to learn is to look outward.

And I think one of the values of Loyalty360 is the opportunity to continue to network, learn best practices, and really share uh what those best practices is across uh you know our peer set, uh across various industries, not just the hospitality industry. Excellent. Uh well thank you, Michael. Uh very uh interesting talking to you, getting to know a little bit more about you, and also just uh the things that you're doing around the program to keep it uh you know top of mind, top of customer, and uh you know organizationally uh impactful.

And it's great to hear everything that you're doing. I appreciate it, Mark. Thank you for the time. Absolutely.