Q 18Q 18
Marriott: Getting Down to Business with Business Travelers
Imagine marketing more than 3,600 hotels and resorts under 18 brands in 71 countries. That's the challenge facing Marriott, a multinational marketer that provides lodging services to millions of customers every day. The company, founded by J. Willard Marriott in 1927, started with a single root-beer stand and the "spirit to serve." Today it rings up $12 billion in global sales from guest room revenue, meals, meeting and special-event revenue, and other services.
Each of Marriott's brands has its own positioning. The flagship Marriott brand, for example, stands for full service. Its properties have restaurants, meeting rooms, fitness centers, and other facilities. The JW Marriott brand is more upscale, and the Ritz- Carlton brand is known for top-quality service. Marriott's newest hotel brand is Edition, a chain of stylish, luxury hotels. TownePlace Suites are mid-priced suite hotels for customers who plan an extended stay away from home. Fairfield Inn Suites are for businesspeople and vacationers seeking value-priced accommodations.
Sluggish economic conditions have only intensified rivalry within the hyper-competitive hotel industry. Major hotel companies such as Hilton, Hyatt, InterContinental, and Starwood all offer a wide range of hotel and resort brands for different customers' needs and tastes. In addition, local hotels and regional chains compete on the basis of location, ambience, price, amenities, and other elements. To compete effectively in this pressured environment, Marriott is relying on extensive marketing research, expert segmentation, and careful targeting.
Focus on the Customer
What exactly do hotel customers want? Marriott uses a variety of research techniques to find out about customer needs and behavior, including focus groups, online surveys, and in-room questionnaires. For example, when it conducted focus groups with customers who had stayed at its Marriott and Renaissance properties, it discovered some interesting differences. Renaissance customers said they like to open the curtains and look out the window when they first enter their rooms. In contrast, Marriott guests said they get unpacked quickly and get right to work in their rooms. "That's when we started making connections about the individual personalities that gravitate toward the Marriott brand," says the vice president of marketing strategy.
With this research in hand, marketers for the Marriott hotel brand targeted a segment they call "achievers," business travelers who feel driven to get a lot done in a short time. They created an advertising campaign to communicate that "Marriott is about productivity and performance," according to one marketing executive. The print and online ads featured interviews with six real customers, who discussed their drive to accomplish personal and professional goals.
When Marriott looked at visitors who prefer SpringHill Suites, one of its suite hotel brands, it found a slightly different profile. These are businesspeople who travel often and see a suite hotel as a place to spread out, feel refreshed, and take a break from the stress of being on the road. These customers are also heavy users of technology, especially mobile communication devices such as smartphones. In reaching out to this target market, Marriott uses mobile marketing as well as traditional media to get its message across. It invites business travelers to download its iPhone app, for example, and runs ads designed especially for viewing on smartphone screens. Customers can click on the mobile ad to check availability online or to speak with the reservations department.
One of the newer brands, Marriott Executive Apartments, combines the spacious comfort of an upscale apartment with the elegance of a luxury hotel. This brand targets affluent business and professional travelers, and their families, who plan to be in a city for several weeks or even longer. Ranging in size from a studio to three bedrooms, these accommodations have an upscale, residential ambiance and offer extras such as room service and an on-site café.
More Business from Business Customers
Marriott also targets companies that need hotel space to hold meetings and seminars. In most cases, these companies bring in attendees from outside the immediate area, which means Marriott can fill more guest rooms during meetings. Meetings usually involve additional purchases, such as snacks or meals, another profitable reason to target businesses. Sales reps at major Marriott properties are ready to help companies plan employee workshops, supplier and distributor events, and other meetings for a handful to a ballroom full of people.
Studying the needs and buying patterns of companies that hold business meetings, Marriott's marketers have found that a growing number are interested in videoconferencing and other high-tech extras. To appeal to this segment, Marriott has equipped many of its meeting rooms with the latest in recording and communications technology. Because planning and managing a business meeting of any size can be a complicated process, Marriott offers online special tools for one-stop assistance. Meeting planners can log on to view photos and floor plans of different meeting rooms, reserve space, and book hotel rooms for individual attendees. They can also use Marriott's web-based calculators to determine how large a meeting space they'll need and estimate costs. Downloadable checklists guide companies through every step, from selecting a site to promoting their meetings to attendees. Marriott understands that when a business meeting goes smoothly, the company is more likely to pick a Marriott meeting place next time around.
Targeting Green Travelers
The segment of consumers and business travelers who care about the environment is sizable these days, and Marriott wants its share of this growing market. The company has developed prototype green hotels for several of its brands, designing the public space and guest rooms with an eye toward conserving both water and energy. Marriott will build hundreds of these green hotels during the next decade. Thanks to the company's emphasis on saving power, 275 of its hotels already qualify for the U.S. Environmental Protection Agency's Energy Star designation.
Marriott is also going green by working with suppliers that operate in environmentally friendly ways. It provides pads made from recycled paper for attendees of business meetings held at its properties, for example, and buys key cards made from recycled plastic. Even the pillows in guest rooms are made from recycled plastic bottles.
Getting the Database Details Right
Marriott set up a central database to capture details such as how long customers stay and what they purchase when they stay at any of its hotels or resorts. It also stores demographic data and tracks individual preferences so it can better serve customers. By analyzing the information in this huge database, Marriott discovered that many of its customers visit more than one of its brands.
Therefore, the company created sophisticated statistical models to target customers for future marketing offers based on their history with Marriott. In one campaign, for instance, Marriott sent out 3 million e-mail messages customized according to each recipient's unique history with the hotel chain. Because of its database capabilities, Marriott was able to track whether recipients returned to one of its properties after this campaign- and actual sales results exceeded corporate expectations. This database technology has paid for itself many times over with improved targeting efficiency and higher response rates.
Watch for Marriott to continue its expansion into new markets and new brands with marketing initiatives targeting vacationers, business travelers, and meeting planners.
As Marriott builds more green hotels, should it reposition its hotel brands as being environmentally friendly? Why or why not?