The Power of Word of Mouth

By Kate Rice

Published on: November 20, 2009

My husband is doing marketing for Kimpton Hotels & Restaurants -- for free! The reason is the company's customer relationship marketing program. It helped the Kimpton Palomar in Washington, D.C., to “wow” my husband, who is not easy to “wow.” As a result, he’s telling every discerning traveler he knows about Kimpton -- eight people in the last weekend alone. As any marketing expert will tell you, this word of mouth is the best marketing there is. And it’s happening for Kimpton because it has made CRM as much a part of its operations as changing the sheets.

Here’s how Kimpton used CRM to win over my husband, an occasional traveler to Washington who started staying at the Palomar because that’s where his company booked him. Two visits ago, when he opened up his laptop’s browser -- using Kimpton’s free WiFi -- Kimpton’s home page gave him an offer he couldn’t resist: a chance to sign up for In Touch, the company’s loyalty program. In Touch actually gives you a free night after seven visits and lets you count past stays toward those seven nights. He liked that retroactive accounting and promptly signed up.

Then Kimpton emailed him a customer survey. My husband took it, mainly because surveys are his job and he wanted to see how Kimpton handled it. When the survey asked for suggestions, he mentioned that the walls were thin, and on his last stay his neighbors talked loudly and late. The next morning he received an email from Vanessa Friebe, front desk manager at the Palomar. She thanked him for filling out the survey and apologized for the noise.

Friebe said she would discuss the problem with the engineering team to find a solution. Then she offered him a free upgrade on his next stay. On his next visit, his upgrade was in the computer -- and a hand-written note from Vanessa welcomed him. Friebe gave my husband a story with a happy ending that he loved telling. This was classic viral marketing – it didn’t just happen. Kimpton set up a system for it.

It’s also a system that you as travel agents can emulate. First of all, Kimpton has differentiated itself in the marketplace by clearly defining its brand. It’s a socially responsible boutique hotel group of unique properties with some common elements – including living-room style lobbies, cozy fireplaces and a sense of fun. Near every Kimpton is a chef-driven, locally popular restaurant.

But Kimpton doesn’t just know what it is as a company; it also knows who its customers are. It does that by asking them what they like and what they want. When customers sign up, they get a survey asking them for their preferences, and staff members build on that profile by inputting their own observations. Every 90 days, the company sends out a survey to its In Touch members, who also get special offers and perks. For example, new members of In Touch get a free $10 mini-bar coupon (which explains the small bottle of Glenfiddich on our kitchen counter).

Those surveys don’t go back to some anonymous mailbox. They go straight to someone whom the general manager at each hotel has designated as the staffer responsible for reading and acting upon them. The hotel general manager chooses someone who will make sure that things are being taken care of. At the Palomar, that person is Friebe.

“The thing that makes her a star is that she acted promptly,” says Natalie White, vice president of customer marketing and relationships at Kimpton. What’s key to remember for anyone planning a CRM program is that Kimpton has set up a system giving staffers both the responsibility and the authority they need to deal with these emails.

That kind of service, quickly delivered by a front-line staffer empowered to do so, helps build customer loyalty and keeps customers coming back. While Kimpton won’t reveal its repeat rates, it does say that its loyalty program and CRM practices are clearly working. And those programs are making a big difference for Kimpton in an economy in which hotels are seeing both rates and occupancies plummet. “Our repeat guests have been saving the day for us,” says White.

CRM is paying off on Kimpton’s bottom line. And it can do the same for you if you are willing to make CRM as much a part of your business flow as filing an invoice.

Kate Rice is executive editor covering travel agents and travel technology for TravelPulse.com.