Online Marketing Boosts Hotel Profits

29th August 2006 (Last Updated August 29th, 2006 18:30)

Online marketing and campaigns can offer hefty financial benefits to those in the hotels industry. Mathieu Staat describes how by installing marketing software Neolane, Accor saved around £135,000 in the first year alone.

Online Marketing Boosts Hotel Profits

For those in the hotel and hospitality industries, online promotions can have a big effect on customer numbers. Internet bookings are convenient and popular, and consumers will be impressed by good deals, special offers and ease of website use.

Accor’s online relationship marketing strategy aims to convert prospects into customers and build customer value through increasing the depth of relationship and growing revenues from repeat bookings, cross-sales, up-sales and referrals. 

“Conducting effective campaigns against a complex multi-brand environment requires a degree of automation.”

MARKETING CAMPAIGNS

Mathieu Staat is customer relationship and marketing director of Accorhotels.com. "Online relationship marketing is an important but complex activity for us," says Staat. "We have several hotel brands and offer online communications in up to five languages to subscribers across 15 target zones. We also run six different loyalty and subscription cards."

Conducting effective campaigns against such a complex multi-brand environment requires a degree of automation. Prior to Neolane, Accor used a service-based application solution to plan and manage its online campaigns. However, Accor was dissatisfied for a number of reasons:

  • There was little content-management functionality – it was not possible for more than one person to work on the same campaign, causing delays and conflict
  • Targeting was limited, leading to generalised volume-based campaigns
  • There were problems with data ownership and confidentiality, causing compliance issues
  • There was no scenario or automation functionality
  • The process was labour intensive, prone to human error and inconsistent in demand upon personnel

Campaigns were taking an inordinate amount of time, effort and resource to deliver. Once the campaigns were finally launched, reactivity rates left room for improvement. The process simply could not cope with Accor’s online marketing demands and this put the marketing department under a great deal of pressure.

"In addition, we had to pay the service provider for each campaign and there was no way of linking these operations with our in-house information systems," explains Staat.

ROOM FOR IMPROVEMENT

Accor knew it had to review its options and began the search for a new licence-based software solution that would offer specific elements, including:

  • Support for an international, distributed, multi-lingual and multi-brand environment, allowing collaborative working, yet centralised control of this important activity
  • In-house control of customer data
  • Sophisticated targeting and segmentation
  • Cost-effective generation of large numbers of small, focused campaigns
  • Easy real-time integration with other information systems
  • Data security

Accor set the constraint that any new process would need a short learning curve and begin to deliver ROI within a year. It would also be required to contribute to a corporate-wide objective of driving and supporting an increasing rate of online reservations.

CHOOSING NEOLANE

Accor benchmarked a series of potential solutions. It eliminated products that were technically incompatible and also those from the CRM domain that required substantial investments with typically long-term ROIs. The company also rejected solutions that required burdensome levels of integration. Accor eventually selected Neolane, based on strong references from existing users.

“Analytical and statistical tools allow sophisticated segmentation of the campaign database.”

Neolane now provides Accor with a unified campaign database. Where customer data was once stored across a variety of data silos and was sometimes of dubious quality, is is now presented as a single customer view. This covers each customer’s reservation history, geographic and demographic data, communication history and opt-in confirmations.

Analytical and statistical tools allow sophisticated segmentation of the campaign database, supporting focused, well targeted communications. Accor can now segment, communicate and personalise each message by geographic, language and consumer profile patterns.

Ready-to-use template-based documents enforce brand identity consistency and graphical charters. The Neolane integrated and collaborative content-management infrastructure allows local input to support regional campaigns, ensuring relevancy. Many standard communications can be automated, such as welcome emails to new customers or new rewards offers at certain point levels.

THE RIGHT RESULT

Accor went live with Neolane in early 2005. Staat is proud of the results. "Neolane has strongly supported Accor’s targets for growing internet-based reservations," he says.

“In 2005 we sent almost 20 million emails in five languages and carried out two and a half times the number of campaigns we ran in 2004.”

Further analysis of campaign statistics clarifies how Neolane is adding value. "In 2005, our first year using Neolane, we sent almost 20 million emails in five languages and carried out two and a half times the number of campaigns we ran in 2004", explains Staat.

Campaigns in 2005 were smaller, more frequent and better targeted, with all email content fully personalised depending on customer profile, card membership, geographical position and other variables. “We increased reactivity rates to nearly 30%,” says Staat. “Neolane is helping us to improve frequency of web site visits and conversion rates.”

Not only is Neolane helping to boost online sales, but according to Staat, campaign costs are down too. “The time taken to create communications has been cut by half. In the first 12 months we saved an estimated £135,000."

Since implementing Neolane, opt-out rates have also fallen. Accor has revealed that its database of more than one million people continues to grow, now reaching a rate of 40% per annum.

Using software such as this makes online marketing simpler, while increasing consumer satisfaction. Hotels should focus on their internet-based revenue and strive to improve their marketing and analysis technology.