NY Hotel Starts E-Prospecting Effort

At the rate one New York City hotel chain is going, within a few years the only paper marketing it will be doing is room comment cards. On Sept. 20 it kicked off a 165,000-name e-mail prospecting campaign — its biggest foray into e-marketing to date.

Manhattan East Suite Hotels is committing 60% of its low-six-figure marketing budget to e-mail and online efforts. The budget will cover more e-mail campaigns as well as a small traditional mail retention program.

During 2001, the hospitality firm devoted perhaps 5% of its budget to electronic marketing. “Last year we maybe sent a few e-mails,” said advertising director Priscilla Hurley.

But late in the year Manhattan East began speaking with the New York branch of San Mateo, CA-based Digital Impact, an online DM ad agency.

“We wanted to go in this direction,” Hurley said. “We had tried a few things ourselves on a small basis and we weren't really able to monitor it the way we wanted.”

In January the chain began a 60,000-name e-mail test, with names coming from six compiled files based on people interested in traveling to New York, and who lived within driving distance.

In return for registering on the hotel's Web site (www.mesuite.com), recipients were given a chance to win a free weekend in New York — as well as register to receive news and special offers.

The campaign was successful on two levels. It netted 8,000 names, including 2,000 from people who had the e-mail forwarded to them. “The campaign went viral,” Hurley said, noting that despite a “Forward to a friend” button on the message there was no additional incentive for doing so.

But the campaign had another benefit. The names and responses were fed into “Magic,” the chain's Marketing and Guest Information Center, an in-house 400,000-name customer database. They were then sent seasonal offerings featuring activities in and around New York.

By gauging responses to various tests, such as whether to put the price in the subject line or which pages e-mail recipients clicked on at the home page, Manhattan East was able to refine its solicitations on an ongoing basis.

After the names of guests were fed into Magic, Manhattan East applied DM1, a data hygiene product from Lanham, MD's Group 1 Software. The hotel was able to link respondents to its offers to guests in the spring and summer.

“We paid back the cost of the acquisition campaign, plus 25%, in three months,” Hurley said. (Outside estimates put the revenue generated from the campaign at just under $50,000.)

Hurley said that last year's anthrax mail crisis played little part in the chain's decision to explore e-marketing. “Most of our direct mail went to previous guests,” she said. “They knew that it was from us [by the envelope]. The fear was from letters from sources you didn't know.”

At the beginning of 2002, the chain had 30,000 e-mail addresses. By the end of November, MESH hopes to have garnered 175,000 addresses through a combination of appends, prospecting campaigns and asking guests at registration. The last has been the lease successful. “It's been a very slow build,” Hurley admits. “People are not really anxious to give out their e-mail addresses.”

But once they're contacted, their affinity for the hotel kicks in. During the few tests of appended e-mail addresses it has done, the chain has seen an opt-out rate of less than 1%.