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Copy of Cabo San Viejo: Rewarding Loyalty

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Awais Ali

on 15 January 2013

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Transcript of Copy of Cabo San Viejo: Rewarding Loyalty

Cabo San Viejo: Rewarding Loyalty Kristen Blackwell
Christina Coon
Lauren Schubel
Stephanie Sargeant
Derek Werdenberg Introduction:
Nation's first and leading Health Resort
Founded 1977
Destination Resort
Full range of wellness services
"Create a place were smokers, overweight people, and others could go to feel better and learn how to live healthier lives." Problem Definition:
Whether to adopt a rewards loyalty program
Keeping "full" capacity
Enhancing infrastructure 5C Analysis Short Term: Objectives Long-Term Objectives Alternative #1:
Create A Loyalty Reward Program Alternative #2:
Don't Create A Loyalty Rewards Program Solutions #1: Should Cabo San Viejo
Implement a rewards program?
Increased repeat customers
Increase clientele between Destination and Day Spa
Increase overall customer experience Weaknesses:
Lack of infrastructure
Competition among customers
Negative ROI #2: Who should qualify? How should "points" be accumulated? #3: What should the rewards look like?
Strengths of only applying to Cabo San Viejo:
Creates customer loyalty
Provides incentive to customers to return
Lets Cabo San Viejo’s customers feel like they are receiving a better value
Doesn’t motivate customers to not return and use their points at a different property or different stores
Prevents the clientele from becoming too comfortable and expecting too much Strengths:
Personalized experience
Increased customer satisfaction
Possibility to increase revenue with repeat customers Weaknesses:
Possibility of customer competition
Increased customer expections Strengths:
Better customer relationships can be formed
Sending guests home with a gift is a great marketing tool
Guests feel surprised and delighted with customer relationship rewards
Name recognition, Personalized thank-you note, small gift
All guests can feel equal
Strategic Recommendation: Implement a rewards loyalty program
Tiered system of rewards
Rewards based on number of days stayed
Points used either as a discount or priority check in
Enhance guest recognition
All guests recieve a welcome bag
Priority guests receive floweres and fruit
Connect CaboDaySpa and Destination Resort
Do not partner with external clients
Promote other locations Thank You!
Is there anything that we may clarify for you? Strengths:
Adopt a tiered program where people who have stayed 10, 15, 21, 30+ days will be given points.

Creates fairness
Satisfying guests needs of being rewarded
The thrill of earning points!
Long-term equality among guests Weaknesses:
Adequacy of points rewarded
Complicated process
Issues with "grandfathering" guests
Create a tiered program where people who have stayed 10, 17, 27, and 40+ days will be given points

Relative fairness among frequent guests
Satisfies guest need for rewards
Addiction to collect points
Long-term fairness among awarding points Maintain "full" occupancy
Create strategy and plan for rewards program
Come up with plan to integrate a CRM system
Provide a 'Welcome Pack' in every room, every time
Give fresh flowers and fruit for all priority guests Provide returning clientele with memorable experiences that make them feel valued
Bring in new clientele from different demographics, instead of the typical 40+ upper class white females
Form synergies between Cabo San Viejo day spas and resort properties
Improve customer relationship management practices
Institute a successful CRM system Weaknesses of only applying to Cabo San Viejo:
Could possibly limit the clientele from attending other Cabo San Viejo properties
Could only affect their current upper class female clients who are able to revisit the resort
Could possibly be an easily forgettable reward

#4: Should the rewards apply to Cabo San Viejo or should they redeemable at other places? If so, what patners? Strengths of not only applying to Cabo San Viejo:

Incentivizes customers to try Cabo San Viejo’s other properties
Serves a broader client base who have different ideas of value
Gives clientele a vast amount of choices
Allows customers to treat themselves to gifts that can remind them of the resort long past their stay
Could potentially increase word of mouth
Weaknesses of not only applying to Cabo San Viejo:
Does not increase returning customers
Could increase customer’s expectations, making them continuously wanting more
Could take attention away from Cabo San Viejo and its properties

Have high incomes
70 – 80% of guests are women
Most guests live in California or the West coast region
Interested in a healthy lifestyle
67% heard of Cabo San Viejo by word of mouth
96% of guests rate their stay highly
Majority of guests return after their first visit
Guests have high expectations Competitors

Destination Spas
Miraval, Canyon Ranch, Lake Austin, Golden Door, Rancha La Puerta, & Red Mountain
Day spas
Oasis Day Spa, Metamorphosis Day Spa, Guiliano Spa for Beauty and Wellness, La Petite Retreat
Beauty salons
High-end health clubs
The Sports Club/LA
Cruise ships
Princess, Celebrity, Sliversea, Seabourn, Holland America
Resort hotels
Four Seasons Resort Hualalai, Esperanza Resort, LemuriaResort Company

Product: High cost destination resort spas and branded day-spas Offer a rare combination of exercise, spa, and health resources
Goal: To help people become the best they can be through body treatments, exercise, physiology, physical therapy, and acupuncture
Palm Springs resort spa was widely regarded as among the best in the world
Staff members were hired and trained to offer the very best in personal service Collaborators

Partnership marketing efforts
$150 Neiman Marcus gift-card for staying at the hotel Context

Cabo San Viejo operates in a high end, exclusive environment and provides for guests who are very wealthy and have high expectations for their service. Weaknesses:

Operational challenges
Placing gifts in the right room, remembering correct names
Customer database would remain incomplete
Could fall behind with competitor’s offering loyalty programs
Guests will expect more and more every visit, something Cabo San Viejo may not be able to produce
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