Marketing Insights Newsletter

Special Issue: Hospitality/ Consulting

Pictures Are Worth A Thousand Loyal Customers

Article by: Elizabeth Glagowski, 1to1 Magazine (Sept 2006)

Unless you've built a home or commercial property with stone columns, fireplaces or replica statues, chances are you haven't heard of Milestone Architectural Ornamentation. But be sure that customers of the stone building firm know its name well. The company's customer relationship strategy revolves around going beyond commodity status. Milestone meets needs that clients didn't even know they had.

In addition to supplying stone for building projects, Milestone uses printed pieces as a retention tool, by sending personalized mailings and posters to each individual customer. For Milestone, competition is fierce and to stay competitive, so it's worth the investment to keep the customer relationship strong, even after the sale. "When you're small, you've got to be personal," says Milestone CEO Melody Brenna. "We're a smaller company in the stone business, and we're custom. It makes us unique."

Brenna or one of her staff members takes photos and creates customized photo posters and postcards of each completed job. "We're reminding our customers that we did a great job, and together completed a great project," Brenna says. The company sends three or four posters and 50-150 postcards to each customer, which feature the logos of the both Milestone and that individual client. "Years later, that printed piece may be sitting on a desk in the office. You cannot imagine where the pieces go."

Brenna, who has experience in the marketing and advertising industry, says that her customers are primarily architects, masons, developers, and remodeling firms. They do not have any graphics experience or resources, so they really appreciate the extra touch. For example, the company has built a strong relationship with one customer, Krause Landscape, which has put up the posters in its offices. "It works so beautifully for them and shows that they're a good firm," says Brenna. "As a result, they're always happy to call us." In the B2B space, it's a way that Milestone can strengthen its reputation with clients beyond the basics of supplying commodities.

Brenna estimates that she sends out anywhere from 30 to 100 pieces per week to clients. All work is done in-house. "Without a doubt, it's worth the investment," Brenna says, which includes costs to take and develop photos, buy poster materials, and do the design, printing, and mailing. She adds that customers have responded very positively, and some customers even ask for more posters. Brenna has started giving customers their design disks so they can print more on their own. "We've got a little in-house ad agency," Brenna says, which helps Milestone meet its customers' unanticipated needs in a unique way.

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Leading Hotels Surpasses Points Mentality

Article By: Mila D'Antonio, 1to1 Weekly Newsletter ( March 2006)

In the travel industry many hotel chains depend on points to keep customers loyal. At Leading Hotels of the World, however, simple purchase points are a thing of the past.

Leading Hotels, comprised of 420 independently operated hotels, resorts, and spas, relies on unique customer preferences to build long-term relationships and a strong competitive advantage.

Allison Cripps, director of loyalty marketing at Leading Hotels, is the brains behind the new customer-focused initiative. She launched the strategy more than a year ago with the goal of shifting the company's long-time loyalty program, which she admits was unsuccessful due to the inability to target most valuable customers or respond to the preferences of frequent travelers.

"The value proposition wasn't that strong," Cripps says. "It was 10 years old and it wasn't competitive. We needed to create marketing offers that resulted in more room revenue from membership." She adds that a points program wouldn't work for Leading Hotels in terms of building loyalty because an average booking ranges from $300 to $2,000. "Someone would have to earn a lot of points to get a hotel room," she says.

For a luxury hotel chain, establishing a customer-focused loyalty program made sense. Cripps wanted to test the limits with partnership benefits, multiple tiers, and services like free concierge service. She knew that from a competitive standpoint, Leading Hotel's loyalty program had to be redesigned with the customer in mind, but no internal strategy was in place and marketing constantly struggled to retrieve data from the database. "The issue was having the underlying data about the customers in a format that made it useable to marketing for marketing purposes," she says. The goal, she explains, was to better analyze and understand the company's business on a macro level.

That wasn't an easy feat at first because it meant that the 25 regional offices needed to integrate, access, and share the same customer information. That posed a challenge due to the lack of mechanisms and processes to assist in streamlining and retrieving the customer data across the enterprise -- the Web site, reservation systems, and all the property systems. The hotels operated in silos.

Multistep improvements
To start the enterprisewide flow of customer information, the company established a process agreement in which all the hotels offer their best client lists to marketing for the creation of a master VIP list. Quaero, a hosted CRM solutions provider, collects the customer information through a shared hosted application on an ongoing basis.

Next, the company established the Leaders Program -- a paid customer loyalty program in which guests complete their preferences when they receive their enrollment kits. Preferences include 180 choices, such as dietary restrictions, alcohol preferences, favorite places to travel, and bedding preferences. Quaero analyzes this information and distributes it to Leading Hotels so it can create tailored sales offers. Quaero also notifies a hotel about a guest's preferences 72 hours before his arrival. So now, VIPs receive the same high-touch service at every Leading Hotel property worldwide. "

Not only do members of the Leaders Program experience tailored service, they receive gifts from Leading Hotel partners, such as Tiffany, Molten Brown, and Frette, an Italian linens provider, after their stay. "For the luxury traveler, they stay for a long time and they want an experience of a lifetime, so that's what we're aspiring to do," Cripps says.

Results
Because of its reliance on customer preferences and personal information, the program is succeeding. The combined reservations revenue for last September and October grew 140 percent from the same period in 2004; and the loyalty program itself sold almost $1 million in membership. "I've never seen a program like this," she says. "It's ambitious and goes out on the limb to say, "'I'm going to tailor the travel of individual travelers.'"