Email Marketing for Hotels: A Step-by-Step Guide

With all the hype over social media during the past several years, e-mail has taken a backseat role in many ways.

That’s a shame. E-mail remains a very powerful marketing tool when used correctly. It can serve as the cornerstone of permission-based relationship marketing — the concept Seth Godin explained in his 1999 book Permission Marketing.

E-mail usually has a higher psychological value than other social media communication. If you are consistently delivering value in your messages people will listen to what you have to say. They may even take action.

This may sound like just theory, but in this article I will show you concrete examples of how hotels are using e-mail marketing to make money. We will look at ways your hotel can use email, how to build your list and create a campaign, benchmarks for testing, and finally some case studies of other hotels.

Part 1: Ways your hotel could use email

Use it as a direct response tool. When done correctly, e-mail allows you to communicate with laser-like focus to specific groups of people. This is one of the best ways your hotel can drive direct bookings.

Use it as an automated sales force. More than any other marketing tactic, email lends itself well to automation. You can create a powerful sales system, and then sit back and let it do the work for you. (At the end of this article, there is a case study of how the Broadmoor Hotel in Colorado used this tactic to generate $245,000 in revenue from a $15,000 investment.)

Use it as a feedback and research tool. Many hotels send an automatic survey link to gather guest feedback. That’s a good start. But I think there are also other ways you can use e-mail to get feedback… not only on the guests stay, but also for new ideas and other market research. This depends on the type of list that you have developed, but the potential is there. Be creative about it.

Use it as a relationship building tool. You can send loyal guests special offers. You can notify them of new amenities or features. You can provide insider information. You can use email to give your organization some personality. The opportunities are endless for building top of mind awareness.

Use it to provide superior guest service. There is so much potential for hotels to use e-mail to improve their guests’ experience. A series of e-mails could be triggered whenever someone makes a reservation: leading up to the stay, and then following up after they leave. Putting everything on autopilot insures every guest has an excellent experience interacting with your hotel. It reduces staff busywork and the potential for errors.

Use email to communicate with other important stakeholders. Email communications don’t always have to be sent to guests. There are other groups you should focus an equal amount of time on.

Fairmont Hotels understands this. Nearly half of their email newsletters are written for and sent to other businesses. One newsletter goes to administrative assistants that handle corporate bookings. Another goes to travel agents. Reaching and working with these people plays a large role in generating revenue.

Thought: What business partners should you be communicating with?

Part 2: Plan your list building strategy

Even aside from the ethical considerations, getting the best results from your email promotional efforts requires you create a list organically and with the explicit permission of your prospects.

• You can include a signup form on your website. Just keep it short: email & first name is best.
• Your front desk staff can ask for addresses during check-in or check out
• You can leave a letter of invitation in their room

However you plan to collect email addresses, make sure there is a strong benefit for the person signing up.

The prospect of receiving generic updates from your hotel may or may not be enough. Exclusive discounts or preferred service is more compelling.

Part 3: How to create an e-mail marketing campaign for your hotel

Tips for putting together good emails for your hotel

• Make sure you get through the spam filters. Mail that isn’t delivered isn’t read.
• Write effective subject lines. Tell what’s inside, but don’t over do it. Sometimes boring is best. Don’t use too much hype.
• Always send a text version of each message. If you’re using HTML, you want to provide an option for people who don’t – or can’t – read that format.
• Use a table of contents for longer emails
• Make the email content scannable
• Include descriptive links with a call to action
• Link to a web version (if the email does not display properly)
• Include a “forward to a friend” link on all messages

Choose a publishing frequency

Whether you plan to publish a monthly newsletter or special offers as they’re available, it’s best to create a schedule and stick to it.

Publishing too often can lead to people unsubscribing. If you don’t publish enough, people may forget about you. Find a frequency that works well with your audience. Better yet, give them the option to choose.

The Deer Valley Ski Resort in Utah publishes a “daily conditions” email. Daily emails may normally be too much, but it works when you’re providing information people want. It certainly made Chip House happy.

Part 4: Test, Test, Test

As with most online marketing, success is achieved through continual testing…and making changes based on what you learn.

Tests usually take the form of split-testing: where you send two variations of an email at the same time to the same list. Most email services make this very easy.

Ideas for testing

• Days of the week (Tuesday…or Saturday?)
• Time of day (morning, afternoon, etc)
• Frequency
• Personalization
• Subjects & Topics
• Content
  • Copy
  • Graphics
  • Colors
  • HTML vs. plain text
  • Length
  • Number of links
• Prices
• Call to action

3 most important email marketing metrics to watch

• Open rates
• Click through rate
• Conversion rate – how many people take the next step…whatever you want that to be

Email marketing benchmarks for hotels

MailChimp, a great little company that I use for most of my email promotions, released a benchmarks report with these figures for the hotel industry:

• Open rate: 27.5%
• Click rate: 7.17%
• Abuse complaints: 0.08%
• Unsubscription rate: 0.49%

As they said, this is slightly biased towards smaller hotels - but it’s close to the averages I’ve seen.

Of course, stats like these only serve as a point of reference — your individual situation may be very different. E-mail campaigns that I’ve run typically perform at least 50-75% better than the numbers above. List quality has a huge impact on your metrics. Keep testing, and you can reach above average levels of performance.

Part 5: A few examples of how hotels are using email

Kimpton Hotels uses affinity-based email to boost revenue

As this case study from MarketingProfs (membership required) shows, creating your email program around individual preferences can dramatically increase profits.

Kimpton had a loyalty program that recognized and accommodated individual perferences of guests: all the way down to the type of pillow they preferred. Steve Pinetti, VP of Sales and Marketing, decided that if their email campaign matched the customer care as well as their loyalty program, they could increase revenue.

To do this, the company created seven affinity groups: wine, pets, dining, eco issues, LGBT, “hot dates and great rates,” and “packages and promotions.” By integrating their databases, guest information was updated in real time. Once this system was set up, Kimpton could send very customized emails based on individual preferences.

The end result? Average revenue generated by a customer email campaign increased from $70,000-80,000 to $350,000-750,000.

Lesson: Identify affinity groups, and plan ways to serve them

The Broadmoor Hotel gathers trade show leads with a savvy followup system

As Karen explains in a ClickZ article, The Broadmoor Hotel was trying to obtain sales leads at a trade show a few years ago. People visiting the Hotel’s booth had their badges swiped, which populated a database. Then, a series of 3 email messages was sent to each prospect:

1. Instant followup with an incentive. The recipient was notified of an upcoming drawing for a digital camera. At the same time, the Broadmoor’s benefits to meeting planners were reviewed.
2. Are you a winner? A week later, an email was sent asking the person to click through and see if they won the drawing.
3. Another contest. Three weeks after the show, prospects received another invitation to enter a contest for a 4-day vacation at the Broadmoor.

The end result? The campaign cost $15,000 and generated $245,000 in revenue.

Lesson: Automate emails to create a powerful sales followup system

The Monmouth Plantation uses “sensory overload” to avoid price cutting & increase response

Recently, I shared the story of Monmouth Plantation, a historic luxury Mississippi inn. Because of the recent economic crisis, the hotel had been using special (low) room rates in their email newsletters to generate business.

Recently, however, they decided to focus on selling their lavish experience – and less on the price. They began sending email promoting sensory-overloading experiences.

For example, read the description of their $1,900 Gourmet Package offer that included two nights of accommodations, a tour of three historic mansions, a carriage ride through the quaint downtown area, and in-room massages:

“Upon arrival, guests will be greeted and escorted to their rooms where chilled champagne, chocolates and flowers await their arrival. That evening guests gather in the dining room for hors d’oeuvres and wine; a host/hostess will give a history of the antebellum home. Dining under 17th century chandeliers on the Empire table with beautiful china, silver and first-class service is the highlight of this package. The chef will greet each guest and invite culinary conversation. After-dinner drinks featuring the Southern signature drink, mint julep, will be served in the study nightly. A private hot air balloon ride over Natchez is the featured activity in this package.”

The result? The email open rate increased 15% and their promotions enjoyed a 30-40% click-through increase.

Lesson: Use “sensory overload” to sell your hotel’s experience in your email promotions

Without a doubt, email is one of the most powerful marketing tools we have at our disposal today.

Please, Please, Please (my closing plea)

Speaking as both a marketing professional and a frequent hotel guest, I just ask you to remember what most of us are thinking:

I’m busy. I don’t have much time. My inbox is my sacred space. I use it to interact with friends, family, and business associates…and I’m not particularly anxious to hear from an organization I barely know that wants to sell me something.

• What’s in it for me? I don’t really care about your business operations. I do want to know about stuff that will help me.
• Ask my permission, and have me confirm before you add me to any list.
• Don’t e-mail me constantly. I probably don’t want to hear from you every single day.
• If you send me something I don’t want, I’ll consider it spam… even if I opted in to your list a long time ago.
• Make it easy for me to leave. If I like your content, I’ll stay.

by Josiah Mackenzie on September 11, 2009

Knowledge management and social transformation

For some time I have been banging on about my frustration with social media tools simply being used for marketing purposes while they also have the ability to help transform the way we do business.

The following is a discussion of how different business disciplines have transformed and how marketers can gain a better understanding of social media marketing practices today from looking at the past.
Knowledge management fundamentals

Some 15 years ago I was involved in the knowledge management (KM) discipline. At the time it was an emerging field and a group of us were involved in putting together the Standards Australia Knowledge Management Framework.

Essentially knowledge management was about the creation, transfer and retention of that knowledge primarily within organisations.

The buzzwords of the time included: co-creation, collaboration, CoP (Communities of Practice) – sound familiar? These are words that we often use today in discussions about social media.
Knowledge management implementation barriers

Many of the discussions that we had years ago about how to get people to share their knowledge came up against two critical barriers.
Technology

In 1994 the best we could do was Lotus Notes, we thought it was innovative at the time. We started experimenting with wikis, more innovative intranets but the tools were certainly lacking. Today we have tools such as Twitter, Blogs, RSS, Mashups, Yammer, Facebook, and a variety of wiki platforms.
Attitudes/culture

Encouraging people to share their knowledge was fundamental to the success of the KM program, yet the culture of sharing – even in an online social sense – wasn’t embedded in our culture. Sure there were a few forums but the idea of social networks, review sites etc. didn’t really exist. Today the culture of sharing, contributing and collaborating is embedded in our psyche. We want to share and expect to have our say.
Enter Enterprise 2.0

In the past three years the term Enterprise 2.0 has been bandied around but what is it?

Harvard professor Andrew McAfee coined the phrase Enterprise 2.0, defining it as:

“The use of emergent social software platforms within companies or between companies and their partner or customers”.

The benefits of Enterprise 2.0 are often named as increasing innovation, productivity and ultimately harnessing the collective intelligence of that organisation – certainly KM was a forerunner to this discipline.
How is this relevant to me as a marketer?

As a marketer you are probably aware of social media tools and how they are currently being used to help engage with consumers today i.e. with companies blogging, being involved in Twitter and using different social media monitoring tools to listen to conversations

Many marketers understand these tools as essentially external facing, yet the philosophy behind the benefits and use of these tools was traditionally internal facing (i.e. knowledge management through to Enterprise 2.0). Understanding the history and transition of the varying disciplines gives you a greater understanding of the multiple benefits of the tools.

For example: on a simple level it is good to look at each of the tools your organisation is using such as Twitter, but is this being used for marketing purposes only? Or is it being used as a CRM tool? Are you systematically gathering consumers’ insights that can be fed back to R&D for product development? In short, are you getting the best ROI from these tools?
Enter social business transformation

Recently the esteemed David Armano, a senior partner at Dachis Corp penned a post about business transformation entitled ‘From Social Media to Social Business Design'. Essentially the post discussed "a shift in thinking – less about media and more about tapping the benefits of being a social business in a purposeful way".

Joint partner in Dachis Corp, Peter Kim also posted recently ‘Reflections on Social Business'.

At the core of their new idea is 'The Social Business Design Framework' which captures ecosystem (community), hivemind (culture), dynamic signal (collaboration), and metafilter (content). It is not too dissimilar to the Standards Australia KM Framework that also highlights culture, tools people etc.

So am I saying that Armano's so called new business idea is simply KM? No. There is a fundamental difference. KM was primarily interested in managing internal knowledge sources within a company. The Armano model includes both internal and external knowledge management tools and applications for a more holistic strategy.

Knowledge management (KM) was often discussed as a form of change theory – a discipline that can revolutionise the way we do business. Today with new technologies and cultures aligned with collaboration Social Business Transformation will be possible and marketers can play their part in the revolution.

VW: Meet The Volkswagens (Display Ad)

I think this may be my favourite ad this year. For one it looks fantastic - extremely well designed and visually impactful. Secondly it works perfectly - no bugs or stalls. Finally, without appearing to jump on a bandwagon, it utilises a mainstream trend to pull you in and encourage engagement. Fantastic work!

Apple: Second Opinion Web Banner (NY Times)

Apple have launched another fantastic banner campaign on New York Times, this time its the “Apple: Second Opinion” web banner featured as a rich media page takeover on the home page of the New York times. A classic synced leaderboard / medium rectangle but this time with a nice throw to a few speaking heads across the other side of the site! Nice work Apple.

Content Marketing Strategy with a Side of Social

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Development of a content marketing strategy that speaks to the target audience plays a key role in successful execution of an overall online marketing program. Companies that embrace the social web as part of their marketing mix need to consider the content created within social media channels just as much as corporate web site content.

Whether you communicate to your audience via a blog, Twitter or social networking sites like Facebook, the only true way to build relationships with a growing network is to listen, engage and provide content they find valuable.

When developing a social media content strategy, start by asking questions like: “What does my network find valuable?”.

A little listening can go a long way to get to the heart of a community’s needs. By understanding the pain points of those your company wishes to connect with, the better you’ll be able to provide the resources needed to make better decisions and improve their business.

You may have heard Lee Odden reference the need to create a social media roadmap, starting first by gaining a better understanding of the intended audience and identifying objectives. A social media marketing strategy is the bridge between reaching that audience and mutual goals. Gain an understanding of how you are going to speak to the community and what you want them to do.

Think realistically about providing and receiving value. For example, will building a network of 1,000 friends on Facebook have an impact on your business without clear goals around what you want those friends to do? There’s an implied connection between quantity of network and marketing effectiveness, but with social media it’s more about quality, not quantity.

Capturing insight about your audience in a social media context can be accomplished through:
Participation
Social media monitoring tools
Analyzing web traffic and behaviors to your web site from social media web sites
Surveys of your existing customers
Referencing demographic information supplied by social media sites that offer advertising
Third party data sources such as Quantcast, Hitwise or Microsoft Advertising Audience Intelligence tools

If the objective for your social media efforts is to sell more product, become a resource to help your audience use that product and give insight into what’s in it for them. Make a bigger impact with your community by giving them the knowledge and tools to help them accomplish their goals and in turn, they will see your company as a valuable resource. Follow the ‘give to get’ mentality to build relationships.

How do I create unique content that speaks to my audience?

Provide opportunities for your network to create their own content. Run promotions involving user generate articles, videos, images or other content that can be shared, promoted and recognized. You can also collect and examine the resources you already have, including case studies, articles, white papers, PPTs or blog posts. Chances are, you have the makings for great unique content or can lay the ground work to repurpose that content.

In this age of Web 2.0, those who are active in social media are essentially publishers. Content creation plays a key role in your social media strategy. One way to ensure you publish consistent, unique content that speaks to your target audience and aligns with your target keyword concepts is to create a content calendar.