Stay Awhile

Starwood Hotels & Resorts Worldwide Inc. is meeting its customers’ actual needs through virtual customer service. Launched last winter, the Starwood Preferred Guest Web site (www.preferredguest.com) is the chain’s main tool in enticing visitors to join the frequent visitor loyalty program.

Since the site’s debut in February 1999, more than 2 million new members have joined Preferred Guest, bringing the rolls up to 3.8 million active members. (An active member has stayed in one of Starwood’s 700 hotels – Westin, St. Regis, Luxury Collection, Sheraton, Four Points or W subsidiaries – or had a transaction at one of the hotels during the past year.) The site was also instrumental in doubling the number of members who ascended to Platinum membership, the highest Preferred Guest level, which customers attain after passing through Preferred, then Gold levels.

But as impressive as those swelled rolls are, the purpose of the site is not to make sales. “I would say it is 100% about building relationships,” says Laura Donahue, communications manager for Starwood in Boston.

Interacting with the customer and personalization are the secrets to the site’s success. Preferredguest.com offers a number of amenities, including a guest’s personalized home page, which tracks likes and dislikes, and the ability to book rooms and redeem points in real time. When a member logs on, he or she is greeted by name on his or her own home page. Readily available are the number of membership points they have accrued, special promotions available for those points and what it would take to upgrade. A message on the screen may say, for example, “You have two stays to be a gold member.” Or, “One more stay to get a free Friday.” The visitor can research their next stay, learn about hotels and locations, or book a room.

Members complete a survey when they first sign up that is continually used to personalize communications to them. So facts such as name, address, credit card number and frequent flyer miles, as well as preferences such as what hotel and type of room, bed and pillow they like need not be repeated during subsequent bookings. This original guest profile is enhanced after each stay. Points newly earned are posted on a guest’s site within 48 hours.

But the feature that Starwood executives think gives them the most bragging rights is the ability to redeem points in real time online. “A guest can purchase that night’s stay with those points directly online,” says Victoria Font, director of interactive marketing at Starwood’s White Plains, NY, headquarters. “We’re the only hotel rewards program that can do that.”

Points guests wish to redeem with Starwood’s more than 30 affinity partners can be registered at the Preferred Guest site in real time also, but the actual redemption transaction must be done through the airline, car rental or retailer partners.

DATA FOR LATER

Meanwhile, additional transaction information specific to each guest is collected and stored in a database that will be tapped for one-to-one communications at a later time. This data includes what hotels the guests use, their top destinations, how much they spend, how long they stay, if they are business or leisure customers, what days of the week they tend to check in and out, and the types of rooms they book.

“That will help us to personalize offers, so that if you travel to New York every Wednesday, youwill get an offer for that,” explains Donahue. “If you never go to Albuquerque, you’ll never ever get an offer for there.”

All this gleaning and mining also enables Starwood to present Platinum members more personalized services. “We will do exclusive offers and events to our lead members because they have a propensity to stay with us more often,” points out Jim Berra, creative services director, Boston.

Starwood contacts customers with offers and special promotions through direct mail and e-mail, but is careful not to overload them. The e-mail opt-out rate is less than one-half of 1% and “the reason is we’re not constantly sending messages,” maintains Donahue. “When you do get a message, it’s an important one.”

Although the program has won travel industry awards, not everyone is completely sold on Starwood. “They have made a good beginning, and they are the first to try it, but they have a major challenge in establishing the Starwood brand as the umbrella for the program,” says Joe Brancatelli, a columnist for Bustravel.com. “Some of the awards are expensive on a `spend basis,’ and it’s too soon to tell how that will impact the long-term objectives.”

In the short term, having a healthy presence online is a priority for Starwood.

“The Web site is critical,” says Berra. “More than half of our company’s occupancy is made up of the frequent business traveler. They are going to the Web more and more – not only to get information, but to make reservations. So having a first-class Web site is critical.”