Magical Marketing

Manhattan East Suites built a guest database designed to work wonders.

By Joan Marsan, Technology Editor -- HOTELS Magazine, 10/1/1999

"We've always given our customers what they want," says Priscilla

Hurley, director of advertising, Manhattan East Suite Hotels, New York. "Now

we know what they want before they have to ask."

It's not telepathy that tells Manhattan East housekeepers which pillow--the

buckwheat hull, or perhaps the Swedish memory--to place on a customer's

bed, assuring the perfect night's rest before the guest even arrives.

It's access to the extensive warehouse of preferences stored in the

Marketing and Guest Information Center (MAGIC), the hotel group's guest

database system.

For years, a third party maintained an extensive

database off-site for Manhattan East. The system, however, had limitations.

It was a one-way database. Properties contributed information, but

had no direct access to the data warehouse. And because it was an

off-site, third-party system, turn-around time for marketing campaigns

was slow. "We thought,

'What if we had a database we could use for marketing and direct mail,

and also to feed information back into the operating system right on

property?'" Hurley says.

MAGIC, developed in partnership with Group 1 Software,

Irvine, California, answers Hurley's question. "It integrates our strategy for marketing

with our operations needs," says Barbara Bayone, director of rooms

operations and leader of the database development project.

The system simultaneously allows advertising and marketing staff to

perform traditional database marketing routines and enables guest service

staff to deliver personalized service to every repeat customer.

A Clean Slate

Developing such a comprehensive system took coordination. The database

was installed in March and put fully into use on April 1, 1999, after

standards and procedures were developed and core preferences were determined.

A team composed a better, more complete form for gathering customer

data. The form was instituted throughout the 11 Manhattan East properties

so all hotels would provide and have access to consistent information.

A two-year log of guests with abbreviated preference data was cleaned

and imported into the new system.

Cleaning data was an integral part of the project.

Many guests had multiple entries in the system either because they

had separate records under corporate and personal addresses or because

individual records had been initiated due to variations on a single

address. By comparing birth dates, corporate affiliation and credit

card numbers, Scott Nowakowski, director of management information

services, was able to combine and remove superfluous entries. "The first six months focused on data

hygiene," Nowakowski says. "Now an entry only makes it back

to guest history if there is a clean, complete, mailable

address."

Data-Driven Marketing

The new, cleaner data warehouse has enabled Hurley

to pursue more sophisticated marketing programs. "We're proactively reaching out to people with

offers," Hurley says. This summer, Hurley mailed an offer to customer

names collected from the newly cleaned database. The

offer entitled guests to their choice of free parking, a full American

breakfast for two, 1,000 American Airlines AAdvantage miles or US$20

off their room rate in conjunction with weekend stays (Thursday through

Sunday) taken before September 10, 1999, at a minimum rate of US$179

per night.

The offer received a 2.6% response rate. Hurley

is analyzing feedback to see which guests with what characteristics

participated in the program, and how much lead time is necessary for

a promotion to work. "This

is just the beginning," Hurley says. "We plan to do more analysis

on who our guests are and how they behave."

Comprehensive Customer Care

While Hurley analyzes guest information after the stay, operations

staff surveys each client's file before they arrive. The staff consults

the database, which systematically tracks room feature and newspaper

preferences, before guests check in, guaranteeing in advance of arrival

that guests' preferences will be regarded. Preference information is

available system-wide, so whether a guest is returning to a tried-and-true

favorite or staying for the first time at a sister property, staff members

will be able to provide the familiar service customers appreciate.

Familiar service depends on staff members' ability to note and act

on more than the basic room and newspaper preferences. Staff can also

record unique particularities that the system does not automatically

track. If a guest requests decaffeinated coffee for an in-room maker,

employees can note the request in MAGIC. Before check-in for the guest's

successive stays, diligent staff will have checked the system, noted

that the guest prefers decaf, and supplied the appropriate coffee to

the guest's room.

At The Benjamin, a guest once requested that housekeeping

service his room before 11 a.m. Because the request was noted in MAGIC,

an attendant was able to ask upon a subsequent check-in if he still

preferred that service time, leaving the guest thoroughly impressed.

At the Eastgate Tower, return guests happily find in their assigned

room their favorite foam pillows, the king-sized bed that they prefer

or even a fan. "It's

not all very exciting," says Glenda Maldonado, front office manager,

Eastgate Tower. "A simple 'Thank you for remembering,' is what

this is all about." But it's a thank you that guarantees repeat

business.

MAGIC Measures Up

Hoteliers are all too familiar with high-capital

technological investments that fail to provide sensational returns.

Manhattan East gambled a budget of half a million U.S. dollars on

MAGIC, and the group expected the system to perform well quickly. "We developed all kinds of measurements

to see if we were achieving what we wanted," Bayone says. "We

started with the data integrity index."

The data integrity index measures how many guests make it into the

database. Manhattan East's goal was 90% by the end of 12 months. After

five months, MAGIC was capturing almost 80% of guests. When the system

launched in April, about 5% of customers had some preference noted.

By August, MAGIC stored detailed data for almost 60% of Manhattan East

clientele.

Further proof of the database's success comes with respect to the usability

of data. Corporate addresses, generally considered useless for marketers

who want a direct link to the customer, have been supplemented by home

or personal office addresses. Before MAGIC, Manhattan East possessed

only corporate addresses for 40% of its guests. That number has been

reduced to 16%.

Investing For Success

While a database can store and spew out information,

it can't actively solicit guest input. Only the staff can. So Barbara

Bayone invested heavily in training staff to use the system and rewarding

participation. "We

had an extravagant launch," Bayone says.

She presented MAGIC to almost 900 employees and

initiated a 12-week incentive program. Employees earn points for the

accuracy and completeness of guest information entered into the database.

Points can earn them a trip to Disney's Magic Kingdom or a brand new

Volkswagen Beetle. "It's

been a tremendous amount of fun," Bayone says.

And from all accounts, it's been a success. "There's

really been an effort across many departments: MIS, sales and marketing,

the GMs, not the least to say our owners, who have been very supportive," Bayone

says. And why shouldn't they be? The system works like

magic.

Tech Briefs

Spinning Sales

CDs are not unique marketing tools, but they play an increasingly important

role, acquainting travel agents with properties, allowing meeting planners

to analyze space and offering vacationers a tangible, tempting look

at the holiday of their dreams.

"It used to be cute to have CD-ROMs," says John DePaul, director

of hotel investments, Berwind Hotel Group, Philadelphia, Pennsylvania. "Now

you're looking at the financial picture." DePaul helped Painted

Rain Interactive, Columbus, Ohio, develop a CD for Berwind-owned

Westin Great Southern, Columbus, Ohio. The CD allows the hotel to stand

out, DePaul says, and has condensed the sales process.

Robert Stewart, vice president of marketing, research

and system development, Sandals Resorts, Miami, Florida, says the

100,000-copy run of the Sandals interactive CD, complete with IPIX

images and a reggae soundtrack, has "worked

out terrifically. We turned it into almost a gift, which increased the

tendency for people to hold on to it." With a printing cost estimated

at less than US$1.50 each, the gift acts as a high-return

selling tool for Sandals. Stewart plans to release a second edition

this fall.

Cashing In On Keycards

The coin-operated washers and dryers at the 192-room

The Inn at Schofield Barracks, Wahiawa, Hawaii, were running non-stop

from 6 a.m. to 10 p.m., but General Manager Pauline Barney knew she

wasn't seeing all the profits. "It

seemed like we were doing lots of business," Barney said. "But

when I emptied the coins from the machines, I was only

seeing US$800 when I should have been seeing US$1,000."

So Barney teamed up with a programmer and formed the Windrose Group.

They developed Co Vendor, software that in tandem with Saflok keycards

allows guests to use laundry and vending machines throughout the property

coin-free, electronically posting charges directly to guest folios.

Hotel restaurant and retail store charges also can be posted directly

to the folio with Co Vendor cards.

Additionally, the software tracks laundromat usage patterns. Its documentation

of high use encouraged Barney to buy more machines. And now when a washer

breaks down, the system alerts staff. They can get it fixed, back in

use and making money promptly.

"The guests just love using it," Barney

says of the Co Vendor card. And the property owners, who spent US$20,000

on installation, appreciated the revenue boost of US$.86 per room

night, about US$50,000 in the first year of the system's operation.