Building Brand loyality in indian Hospitality industry Balgopal Singh Assistant Professor, Banasthali University, Rajasthan- 304022 Abstract Hospitality companies can increase their proit margin by creating and sustaining their brand loyal customers. This is a more proitable approach than other marketing activities for service industry than price cuts or promotional programs. In a mature industry like hospitality, acquiring new customers is expensive because of advertising, promotion, and start-up operating expenses, but it is cheaper to serve existing customers. This paper is an extensive literature survey to bring together the factors that contribute in developing and sustaining brand loyalty and provides strategies to hospitality managers for retaining brand loyal customers. Key Word Brand Loyalty, Hospitality, Frequent Guest Programme. IntroductIon The Indian Hospitality Industry is one of the important service sectors of the Indian economy. Riding on the economic growth and rising income levels that India has witnessed in recent years, this sector has emerged as one of the key sectors driving the country’s economy. The current market size is US$ 23 billion, accounting for 2.2% of India’s GDP as well as provide substantial employment to the people. Economic double digit growth rate and rising disposable incomes and increase in double-income households have played an important part in the growth of this industry. On an average, Indian hospitality irms are facing dificulty in bottom line because of high taxes, rising competition, high input cost such as skilled manpower and Terrorism. The marketing literature suggests that irms to increase sales and their market shares has to decrease prices, launch promotional campaigns, and try to retain their existing customers (Cravens, 1994). Customer loyalty would be a more effective tool for a mature industry like hospitality (Jarvis and Mayo, 1986). According to Reichheld (1996) - When customers are lost, new ones must be attracted. However, replacement comes at a high cost. Capturing new customers is expensive because of advertising, promotion and sales costs, and start-up operating expenses, which is not possible for irms operation in tight proit margin as condition prevailing in India. Reichheld, in his book, The Loyalty Effect, argues that in businesses like auto and life insurance and credit card irms, attracting new customers often costs approximately ive times what it costs to retain current customers. It costs less to serve loyal customers because familiarity with the company’s products and services bars variety seeking behaviour and resist the situational factors such (eg. friend recommending alternative brand, information of Competitors’ brand and other competitive brand). A satisied, loyal customer can contribute a great deal to the bottom line of any company. Therefore, the purpose of this article is to emphasize the importance of brand loyalty and to determine factors that contribute to brand loyalty. This paper provides strategies for hospitality managers for retaining brand loyal customers. HospItalIty Industry Hospitality industry, historically viewed as an industry that provides luxury service (Room and allied) valuable to the people and economy of a country. The Hospitality Industry comprises a major part of the tourism industry. consumer segments The market for the hotel industry is divided into following key consumer segment based on the duration of visit. Visitors are divided in to two categories: Tourist – who stays one or more night in the place visited, and Same-day visitors – visitors who visit a place and return the same day. Tourists who stay for one for more night are classiied as business traveler, leisure traveler and visiting friends and relatives. This classiication is based on the purpose of their visit.