Cutting Through the Clutter

Don Hay hates it when spam interferes with attention-worthy online offers. He has spent considerable energy figuring out the best time to present hospitality products — like rooms and deals — to potential customers.

“Spam is the overwhelming thing you have to overcome in e-mail,” the head of e-mail marketing customizer Digital Alchemy told the LH Roundtable. Hay focuses on staying “whitelisted” with Internet service providers so Digital Alchemy can reach its targeted hotel audience.

“We have to figure out a way to get the e-mail to arrive to an empty inbox,” he said. “We've modified our marketing pieces — there are about 12 steps — and the e-mail arrives to an empty inbox. Our open rates skyrocketed when we started doing that.

“Everybody in this room faces the problem, whether you have spam showing up and driving you crazy or you're trying to get a message to your guests and they're not receiving it because they've got their spam filter cranked up to where their own mother can't get through to them.”

Although participants brought different views to a spirited discussion of e-mail, CRM, data security and related issues, the conversation pointed to links between marketing and customer relationship management that could bear lucrative fruit.

Mike Schmitt, the chief executive officer of customer intelligence software manufacturer Clairvoyix, said no matter the medium, what's critical is determining who your customer is. Even though Clairvoyix, which partners with Digital Alchemy, began with the upscale segment, it's generating increasing interest from limited-service hoteliers, Schmitt said.

“We've been getting calls from organizations with a nice portfolio of limited service that want to understand who their guests are,” he said. Even though these hotel companies tell Clairvoyix they value third-party vendors for selling some inventory, they also resent them for “capturing” some guests.

Shifting so-called distressed inventory to third parties has “created a monster,” Schmitt said, “and that monster is starting to figure out who these people are and form a relationship with them and the hotels want to take it back. The poor front-desk clerk doesn't have a good chance without a good system to be able to dig in quickly and figure out that this person has stayed 10 times at a sister property but never here, and we need to do something about this right now.”

Personalization is critical, too, said Hay, elaborating on the connection between e-mail marketing and CRM. Blunting the effect of negative comments posted to peer review sites like TripAdvisor and Igougo can be done through personal response, he said.

Digital Alchemy developed software that can help, Hay said, citing Hotel Zaza, a luxury property in Dallas. When the general manager gets negative e-mail comments on his BlackBerry, he can respond immediately. “He got the e-mail address, he knows who the guest is, what room he was in, what he paid, so immediately a message goes back saying, ‘We're sorry, I want to fix it next time you come to town.’” That GM never “had a guest say I will never come to your hotel again, even though the comment card said, ‘I hate you and I'm going to bury your children if I get a chance.’” A positive, healing response counts more than a “rotten experience,” Hay said.

CRM: A MOVING TARGET

Panelists couldn't agree on a definition of CRM but suggested it hasn't lived up to its potential. One reason is lack of follow-up.

Training is an issue, too, several said. It's fine to collect data, but it's useless unless properly mined and applied, said David Berkus of Hospitality Automation Consultants.

Nick Price, chief technology officer for Mandarin Oriental Hotel Group, said Mandarin collects customer information, some with guest knowledge and some without; and marketing information that Mandarin uses “only to communicate in mass to the potential future customers of our company.” Mandarin separates these because it doesn't want “information about individuals within our company used inappropriately by the marketing campaign, to speak overly personally to any one individual.”

It's hard for a “high-touch hotel company” to capture information, keep it “clean,” qualify it and teach people how to use it “in an intelligent way that's a personal response.”

Several panelists said that all too often, hotel companies that establish a project plan and budget fail to consider the time required for change management and for communicating the proper use of new technology to the front desk or reservations agent. In addition, different constituencies have different approaches — and needs.

“Many of our companies have multiple relationships with customers, but they're not aggregated,” said Bob Bennett, CIO of Ginn Clubs and Resorts. “We have individuals who are owners of our property, owners of our clubs and also guests in our hotels. Quite often that's the same person and they have different relationships by different communities…Is your CRM indicating all the different relationships?”

“You don't need a computer to do CRM — it helps — but you certainly can't have a computer and not do the manual things to understand the data and make effective use of it, which is really the relationship part of the customer management system,” Price said.

But the manual aspect can also harm, as suggested by consultant Jon Inge's question to Carlson IT expert Dave Sjolander:

“Given the number of properties you deal with, how do you insure consistency of data entry so people will always do things the same way so you can combine it more effectively?”

“It involves all kinds of stuff, and with a thousand hotels, you just can't fix it,” Sjolander said. “You go after the big stuff and you solve it as best you can…Maybe someday we'll solve all those big problems, but it's going to be a while.”

Even handling names can be tricky. “You'd better get used to dealing with non-North American or non-Western names,” said Mandarin Oriental's Price. “We have in our customer database a capability to be able to equate a Chinese character such as Wong with Wang, Quong, every single synonym we could possibly think of. That's what you're going to have to do if you want to understand how to recognize an international name and not give everybody a little plastic card with a number on it…when I go around the show floor here, I see very few pieces of software that could even begin to understand even non-North American name representation.”

Recognition of diversity, protection of data, identity leaks, the onset of smart card technology and the limits of self-service occupied the remainder of the Roundtable discussion. The talk kept yielding knots such as this one from Cendant executive Jeff Edwards: “It's going to get more complicated to run a hotel and it's going to be harder and harder to find people who want to work in limited-service, economy-scale hotels.”

Perhaps next year's Roundtable will unravel that vexing tangle to explore how training, an increasingly diverse and hard-to-classify labor force and accelerating technological developments can be brought together.


An audio recording of the 2006 Roundtable is available at Lodging Hospitality's website, www.LHonline.com.

Roundtable 2006

This is the last of two reports on the Lodging Hospitality Technology Roundtable held June 21 during the Hospitality Information Technology Exposition & Conference in Minneapolis. The fourth such LH-PRPro get-together convened 26 experts in hotels and in the technology hoteliers need for their increasingly complex and demanding operations. This deals with e-mail, CRM and related issues surrounding diversity.

The moderator was Ed Watkins, editor of Lodging Hospitality. Here are the participants and their companies: Dave Berkus and Les Spielman, Hospitality Automation Consultants; Daniel J. Connolly, University of Denver Daniels College of Business; Mark Haley, The Prism Partnership; Jon Inge, Jon Inge & Associates; Sally Kelly, Bearing Point; Mark Ozawa, Accuvia Consulting; John Burns, Hospitality Technology and Consulting; Rick Munson and Mark Houser, Multi-Systems, Inc.; Nick Price, Mandarin Oriental Hotel Group; Bob Bennett, Ginn Companies; Kevin Smith, The New Yorker Hotel; David Sjolander, Carlson Companies; Jeff Edwards and Stuart Ceruillo, Cendant Hotel Group; Jason Kippa and Steve Woodward, Centrada; Shannon Knox, Destination Hotels & Resorts; Mike Schmitt, Clairvoyix; Don Hay, Digital Alchemy; Henry Woodman, ICE Portal; Jeff Thomas, Leonardo; and Julie Werbitt and Jeffrey Krevitt, Tiare Technology. You can hear the whole Roundtable at www.LHonline.com, LH's website.

THE BIG IDEAS

Use technology to deliver your message free and clear. Before you can market, you have to cut through the spam. Make sure your technology provider fights spam effectively.

Know your customer. Information is useless unless it's properly mined, understood and applied. Keep customer information and marketing information separate because they serve different purposes.

Incorporate diversity into your customer intelligence. Use software that recognizes and addresses different languages and demographics. The non-Western world is developing rapidly as a source of hotel business.

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