The era of one-size-fits-all loyalty programs is over. Guests who can choose how they earn rewards book more, spend more, and return more. Here's the data behind the shift.
Ellis Connolly
CRO at Laasie
For decades, hotel loyalty programs operated on a simple premise: earn points, redeem for free nights. It was clean, predictable, and — as we now know — deeply flawed. The assumption was that every guest wanted the same thing. They don't.
Think about the last time you stayed at a hotel. Did you care about accumulating points toward a free night three stays from now? Or did you want something more immediate — a dining credit, a room upgrade, a spa voucher? The answer depends entirely on who you are, why you're traveling, and what matters to you in that moment.
Traditional loyalty programs ignore this entirely. They offer a single redemption path and hope it resonates with enough guests to justify the program's cost. The result? Disengagement. Industry data shows that over 60% of hotel loyalty points are never redeemed — a staggering waste of both guest goodwill and hotel investment.
At Laasie, we've analyzed redemption behavior across more than 200 hotel properties and 2 million loyalty interactions. The pattern is unmistakable: when guests are given a meaningful choice in how they earn and redeem rewards, every key metric improves.
The moment we gave guests three reward options instead of one, our direct booking conversion went up 19% in the first month. It sounds simple, but it completely changed how guests perceived the value of booking direct.
The psychology here is well-established. Autonomy — the feeling of being in control of your own decisions — is one of the most powerful drivers of human satisfaction. When a hotel says "here's your reward," it feels transactional. When a hotel says "choose your reward," it feels like a relationship.
This distinction matters enormously in hospitality, where the emotional quality of an experience is often more memorable than the functional details. A guest who chose their own reward remembers the moment of choice. A guest who received a predetermined reward remembers... nothing in particular.
Through our research, we've identified three distinct guest reward archetypes that appear consistently across property types and demographics. Understanding which archetype a guest belongs to — and presenting rewards accordingly — is the foundation of a high-performing choice-based loyalty program.
The most effective loyalty programs don't try to guess which archetype a guest is — they present options from all three categories and let the guest self-select. This single design decision accounts for the majority of the performance gap between choice-based and traditional programs.
One concern we hear frequently from hotel operators is that offering choice will create operational complexity. In practice, the opposite is true. A well-designed choice-based program actually simplifies operations by replacing a sprawling points ledger with a clean, transparent reward selection at the time of booking.
The key is presenting three to five curated options — not twenty. Too much choice creates decision paralysis. The right number of options creates the feeling of autonomity without overwhelming the guest. This is the "Goldilocks zone" of loyalty design, and it's where Laasie's platform is specifically engineered to operate.
The hotels winning the loyalty game in 2025 aren't the ones with the most points or the biggest redemption catalogs. They're the ones that made their guests feel seen, valued, and in control. Choice is the mechanism that makes that possible — and the data proves it works.
If your loyalty program is still built around a single redemption path, you're leaving revenue, repeat bookings, and guest satisfaction on the table. The shift to choice-based loyalty isn't a trend. It's the new standard.
About the Author
Ellis Connolly
CRO at Laasie
Ellis Connolly is the Chief Revenue Officer at Laasie, where he leads go-to-market strategy, revenue growth, and hotel partnerships. With over 15 years in hospitality technology, Ellis has helped hundreds of independent hotels and management companies shift from OTA dependency to profitable direct booking ecosystems.
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