Customer Loyalty Program: Tourist Destination and Bonus Card System E-Book

Timo Kühnle

• Herausgeber: GRIN Verlag
• Sprache: Englisch

Veröffentlichungsjahr: 2004

Beschreibung

Bachelor Thesis from the year 2004 in the subject Tourism - Miscellaneous, grade: 1,0 (A), Stralsund University of Applied Sciences, language: English, abstract: The questions this thesis is trying to answer are * Can a bonus card system help to make the tourists loyal to a destination and turn one-time visitors into frequent repeaters? * What is the difference to the already existing tourist cards offered by many destinations already? * Can such a system be combined with the visitor′s tax tourists have to pay in many resorts and help to improve its image and acceptance? * How can such a system be implemented? This thesis is one of the first essays about the combination bonus card and destination. Yet there is no specific literature existing about this subject and therefore also descriptions of other areas will be used and adapted. One of the basic objectives of this essay is, to give arguments for a tourist destination to convince possible partner companies to enter such a program and not to be afraid of the investment, and to deliver a guide for the implementation of a destination bonus card system.

Leseprobe

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Table of Contents I

Table of Figures

List of Abbreviations

1. Introduction

1.1. Subject and Objective

1.2. Approach

2. Fundamentals

2.1. The Customer

2.1.1. The Status of the Customer

2.1.2. Customer Value

2.1.3. The Customer as Prosumer

2.2. Customer Retention

2.2.1. The Importance of Customer Loyalty

2.2.2. Basics for the Loyalty

2.2.3. Instruments for Customer Retention

2.3. Card-Systems as Marketing Instrument

2.3.1. An Overview on Cards

2.3.2. The Customer Card

2.3.3. Cards in Tourism

2.3.4. Provision of Cards

2.4. The Tourist Destination and the Darss Peninsula

2.4.1. The Tourist Destination

2.4.2. Destination MV

2.5. The Visitor's Tax

2.5.1. The Visitor's Tax in Germany

2.5.2. Ahrenshoop's ordinance as example

2.5.3. Comprehension Difficulties for the Tourists

2.6. Benchmarking

2.6.1. Definition

2.6.2. Types of Benchmarking

2.6.3. The Use of Benchmarking in this Essay

3. Benchmark-Study and Market Analysis

3.1. Tourist Cards

3.1.1. German Tourist Cards

3.1.2. The Rügen Card as Competitor

3.1.3. The Engadin Card as Best Practice Example

3.1.4. The Stralsund Card as Negative Example

3.2. Card Systems in other Sectors

3.2.1. An Overview

3.2.2. The Miles-and-More Program of Lufthansa

3.2.3. The Payback Card as Market Leader

3.2.4. The Soltau Card as City Card example

3.3. Sample Companies for the Implementation

3.3.1. Smart Loyalty AG

3.3.2. Smart Approach GmbH

3.3.3. The Basic Functions of the Systems

4. Data Interpretation

4.1. Data of the Destination Darss

4.1.1. Number of Visitors

4.1.2. Calculation of the Target Group

4.2. The Questionnaire

4.2.1. Fundamentals of the Survey

4.2.2. The Survey as Snapshot

4.2.3. Interview Rules

4.2.4. About the Questions

4.2.5. Scale

4.2.6. ServQual

4.2.7. Further Surveys about this Subject

4.2.8. About the Analysis

4.3. Analysis of the Survey Results

4.3.1. Single Question Frequencies

4.3.2. Cross Tabulation

4.4. Interpretation Summary

5. Implementing a Destination Bonus Card System

5.1. Procedure

5.2. Stage 1: Preparing Research

5.2.1. Competitors and Comparable Products

5.2.2. Card Systems on the Local Market

5.2.3. Interests of Potential Partners

5.2.4. Interests of Potential Customers

5.3. Stage 2: Setting the Objectives

5.3.1. Functions of the Card

5.3.2. Partner Companies

5.3.3. Target Groups

5.3.4. The Award System

5.3.5. System Providers

5.4. Stage 3: The Implementation

5.4.1. Project Group

5.4.2. Project Structure

5.4.3. Card Name and Design

5.4.4. Emission Price of the Card

5.4.5. Integration of Partner Companies

5.5. Stage 4: Controlling

6. Conclusion

Appendix

References

Table of Figures

Figures in the Main Part

Fig. 1: Structure of the Essay

Fig. 2: The Service Triangle

Fig. 3: The Loyalty Staircase of the Customer

Fig.4: Percentage of Unused Cards

Fig.5: The Darss Peninsula

Fig.6: Types of Benchmarking

Fig.7: Regional Tourist Cards in Germany

Fig.8: City Tourist Cards in Germany

Fig.9: Saving with the RügenCard

Fig. 10: Number of Guests in the Destination Darss 1998-2003

Fig. 11: Increase of Guests in the Destination Darss 1998-2003

Fig. 12: Comparison of the Visitors' Origin

Fig. 13: Importance of and Satisfaction with the Visitor's Tax

Fig. 14: Interests in a Darss Bonus Card

Fig. 15: Effects of a Darss Bonus Card on the Off and Low Season

Fig. 16: Interrelation between Interests in a Bonus Card and Federal State of Origin

Fig. 17: Interrelation between Interests in a Bonus Card and Number of Memberships in other Bonus Programs

Fig. 18: Stages to Implement a Bonus System

Fig. A1: Location of the Holiday Accommodation

Fig. A2: Duration of the Visit in the Destination Darss

Fig. A3: Type of Accommodation

Fig. A4: Type of Travel Group

Fig. A5: Importance of the Visitor's Tax Performances

Fig. A6: Satisfaction with the Visitor's Tax Performances

Fig. A7: Interests in a Darss Bonus Card

Fig. A8: Effects of a Darss Bonus Card on the Off and Low Season

Fig. A9: Number of Memberships in other Bonus Programs

Fig. A10: Gender

Fig. A11: Age

Fig. A12: Federal State of Origin

Figures in the Appendix

Fig. A1: Location of the Holiday Accommodation 93

Fig. A2: Duration of the Visit in the Destination Darss 94

Fig. A3: Type of Accommodation 95

Fig. A4: Type of Travel Group 96

Fig. A5: Importance of the Visitor's Tax Performances 97

Fig. A6: Satisfaction with the Visitor's Tax Performances 98

Fig. A7: Interests in a Darss Bonus Card 99

Fig. A8: Effects of a Darss Bonus Card on the Off and Low Season 100

Fig. A9: Number of Memberships in other Bonus Programs 101

Fig. A10: Gender 102

Fig. A11: Age 103

Fig. A12: Federal State of Origin 104

List of Abbreviations

1. Introduction

1.1. Subject and Objective

Customer loyalty programs can be found all over the economical market today and there is a reason why companies do this. People like collecting miles, digits or points, so on the example of gas stations many drivers rather wait for the next Shell than to buy their petrol at the No-Name station around the corner, only to have the chance to earn enough points for a walkman or a sports bag, and many other customers are acting the same way without realizing it.

In the tourism market there is an additional participant to companies like the big tour operators or the small privately owned hotels, which is the tourist destination as a whole. It has to be competitive against other destinations, nationals and internationals. The question is now, if it is possible to apply a customer loyalty program, like they are widely used by companies, to a tourist destination and if it makes sense.

The origin of this topic are the city bonus cards[1], that were implemented especially by mid-size cities to resist the trend of customers to leave their home-towns towards shopping centers, which are located outside the city borders, and towards the big cities. With this behavior a lot of the spending capacity of the inhabitants was carried away. These cities, which can according to their basic structure be compared to a tourist destination as opposition to companies, already successfully adapted bonus systems to keep the people in town.

Throughout this essay the example of the tourist destination Darss[2] will be used to explain the system. Most of the shops and hotels of this area are small or mid-sized and privately owned, so such a card program can also be seen and used as marketing association of separate companies. So far there is only existing a visitor's card with no additional function, which is a document for the tourist that he has paid the visitor's tax, but neither a tourist card nor a bonus card are distributed. Comparable to a feasibility study, the chances for the implementation of a customer loyalty program are observed and analyzed on this real case.

The questions this thesis is trying to answer are

Can a bonus card system help to make the tourists loyal to a destination and turn one-time visitors into frequent repeaters?

What is the difference to the already existing tourist cards offered by many destinations already?

Can such a system be combined with the visitor's tax tourists have to pay in many resorts and help to improve its image and acceptance?

How can such a system be implemented?

This thesis is one of the first essays about the combination bonus card and destination. Yet there is no specific literature existing about this subject and therefore also descriptions of other areas will be used and adapted. One of the basic objectives of this essay is, to give arguments for a tourist destination to convince possible partner companies to enter such a program and not to be afraid of the investment, and to deliver a guide for the implementation of a destination bonus card system.

1.2. Approach

The essay is self-contained and structured consecutively to finally understand the chances, the possibilities and the advantages of a bonus card system for a tourist destination and even to be able to implement it.

Fig. 1: Structure of the Essay

Source: Own Illustration

The fundamentals in chapter 2 are giving a background to understand the coherences. Initially the position of the customer is explained in general and focused on tourism, which is mainly a service industry. How important loyal customers are and which basic terms and conditions are leading to customer retention will be described, before the different card systems and their use as marketing instrument are specified. To built a connection of customer loyalty, bonus card and destination, this is defined afterwards with a more detailed look on the Darss Peninsula in the federal state MV[3]. The resorts of this destination are allowed to claim visitor's tax because of their status, which is explained before the description of benchmarking as basis for the following chapter.

In chapter 3 a basic benchmark-study and market analysis helps to learn from other systems, that are already existing. At first cards used in tourism are examined, to see what the competitors are doing. Afterwards a look on card systems independent of the tourism sector figures out the benchmarks of other systems and what could be adopted, before then two system providers and their products are described to get an idea of the technical equipment and the costs that occur.

To analyze the chances for the implementation of a bonus card system in the destination Darss, a snapshot survey was accomplished in that area and the results are interpreted in chapter 4, in addition to the secondary data of the last years, that was provided by the tourism association of the Fischland-Darss-Zingst area, the "Tourismusverband FDZ". The questionnaire and the researched subjects can be seen as example and used for other destinations as well.

The procedure described in chapter 5 was developed based on the collected information and consists out of four stages, that explain the necessary steps towards a successful implementation of a destination bonus program. It is a guide for destination managers to understand the requirements for it.

2. Fundamentals

2.1. The Customer

2.1.1. The Status of the Customer

In the case of tourism it can be said, that the customer is equal to the tourist. But the word tourist does not describe enough, what he is supposed to do, which is spending money and so creating revenue for the travel industry, the small shops, hotels and restaurants and with this tax income for the destination. He is not only touring and traveling, he is also client and consumer.

A simple definition of a customer could therefore be:

 “Ein Kunde ist...

 ...einer, der mein Produkt kauft,

 ...jemand, dem ich eine Dienstleistung erbringe,

 ...einer, der einen Bedarf hat.“[4]

But a customer is more than this, he has a much higher status. We are not anymore back in the times, when the customer was acting according to Maslow’s Pyramid, when in the first place he had to fulfill his basic needs to survive, which means he had to buy his bread no matter where and was not able to choose in which bakery he would do this. Today the customer is comparable to a sovereign emperor who has in most cases except for some monopolistic branches the power to decide which product he wants to purchase or which service he wants to use[5].