Travelocity Takes E-mail in House

Travelocity saved so much money bringing its e-mail program in house that the online travel site plans an acquisition program this fall designed to add 2 million subscribers to both its e-newsletters.

The 6-year-old company turned to Socketware, an Atlanta e-mail software firm, when it realized outsourcing all its e-mail was becoming financially burdensome. Now, using Socketware's Accucast Enterpise technology, the dot-com sends, manages and refines its own e-mail program.

“E-mail is a small part of our marketing budget, but when you're sending out 30 million to 40 million a month, it can get expensive,” said Paul Briggs, director of research and analytics at Travelocity's Fort Worth, TX headquarters.

Travelocity saved $10,000 a month by bringing the e-mail program inside.

“E-mail in-house brings my unit cost for e-mail to zero,” Briggs said. The travel site pays for its in-house e-mail campaign managers' salaries, which is a fixed cost, but instead of paying for each e-mail [as it did when outsourcing the program], Travelocity pays a set fee. “The cost is the same if I send 40,000 or 40 million,” Briggs said.

The vacation source has 33 million members — people who logged on to the site (www.travelocity.com) and registered by keying in their name, postal and e-mail addresses. Each of the free e-newsletters has 7.5 million to 8 million members as subscribers.

The Insider e-newsletter, which is broadcast monthly, focuses on destinations subscribers know they will be traveling to or venues they dream of visiting. “It's Cruise Season — consider the Caribbean” might be an example of a promotion. Seven or eight offers (or more, depending on the time of year and available deals) are displayed in each newsletter.

The Real Deal, which blasts twice a month, is focused on the best prices available at the moment. It features about 20 discounts for airfare, hotels, car rentals, cruises, vacation packages and more.

Beyond cost, a major benefit of sending the newsletters from headquarters has been better database marketing. For the first time, the company is able to collect customer behavior data and add it to in-house records on that customer.

Briggs can now look at factors such as how long customers have been members, how often they buy, how they respond to the e-mailings — and then target subsequent broadcasts accordingly.

For example, “If you're a JetBlue customer who has flown from New York City to Long Beach, CA in the past, we can send an e-mail about a promotion on that particular route,” Briggs said.

Database intelligence combined with savings prompted the fall campaign. E-mail is so inexpensive that all 33 million members are on tap to receive one.

These promotional e-mails will be designed to entice people to register for the e-newsletters, visit particular areas of the Web site or to push various special offers.