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Kimpton Hotels Uses CRM to Confer Karma on Guests

  |  August 8, 2014   |  Comments

Salesforce and ExactTarget Marketing Cloud form the basis of a loyalty program that aims to surprise guests with unexpected treats and rewards, all in an effort to grow the hotel chain's customer base.

Kimpton Hotels and Restaurants says its new loyalty program is about making guests love them more, instead of simply rewarding them for dropping cash.

The company launched its revamped loyalty program, Kimpton Karma, on July 16. It replaces the former two-tiered program with a system that lets members move up through several tiers, each of which provides different perks. But the new system moves away from a transactional approach – X number of points to get Y – to a more personalized system that also allows hotel staff to provide more personalized treats based on enhanced guest profiles.

While there is a published benefits schedule and guests can still earn free room nights, "There's a whole other engagement layer that's unpublished, running behind the scenes, powered by Salesforce," says Maggie Lang, senior director of loyalty and relationship marketing for Kimpton.

In fact, Kimpton Karma, as well as a new tile-centric website, is the result of a two-and-a-half year project in which the hotelier rebuilt its customer relationship management (CRM) and loyalty systems from the ground up, based on Salesforce1 and its ExactTarget Marketing Cloud.

A new proprietary algorithm takes into account not only a member's stays and purchases, but also brand engagement activities, including booking directly on the website, social media interactions and taking advantage of activities such as traveling with a pet or showing up for the nightly Wine Hour.

If a guest tweets a photo of a dish at a Kimpton restaurant, he'll get a message when he logs into his Kimpton Karma account thanking him and adding, "Here's a little extra Kimpton Karma."

Exactly how much karma is added to the account is somewhat randomized, according to Lang. But it's not based on the size of the transaction, nor on an estimate of the guest's potential lifetime value.

"We wanted to draw a line in the sand. All the big airlines look at total lifetime revenue," says Lang, a former United Airlines marketing exec. "We're saying we have to earn your loyalty. Our mission is to be the best-loved."

The system lets hotel staff directly input information about guest preferences to provide more personalized perks and "surprises."

"This allows us to treat individuals uniquely," Lang says. For example, if a guest has come to many Wine Hours, the hotel may send a case of wine to her house. "[But] we don't promise to do anything," she notes. "If people are expecting the case of wine, it's not as much fun."

Kimpton Karma takes advantage of some new features of the ExactTarget Marketing Cloud. On July 30, Salesforce launched a new version of its Journey Builder tool within the ExactTarget Marketing Cloud that lets marketers visualize the customer journey while setting actions based on "triggers," such as abandoned sites, abandoned shopping carts, browsing products, or behavior indicating a change in interests, or, as ExactTarget calls this, a change in propensity.

Explains Woodson Martin, chief marketing officer (CMO) of Salesforce ExactTarget Marketing Cloud, "A marketer can configure the journey so that, if there is a propensity change, there is therefore an opportunity to offer something new."

The system's predictive intelligence engine can analyze all customer behavior to determine that, for example, if a customer has previously bought hiking boots and is browsing camp stoves, he's likely to respond to an offer for camping cookware.

According to Martin, Microsoft has used Journey Builder to engage users of its Office360 mobile app. For example, if someone opens a mobile Excel file once but does not come back to it, that triggers an offer of a video tutorial on how to use the application.

"Microsoft has programmed thousands of these interactions that they know will help a customer better engage and renew their subscription," he says.

Lang wouldn't divulge the cost of Kimpton's Salesforce/ExactTarget implementation, saying only that it was extremely expensive and a significant investment. In terms of return on investment (ROI), she adds, "Our main goal is to get first- and second-time guests to return. We found once people stay multiple times in our hotel, they tend to be hooked. The entire object of redesigning Karma is getting that guest to return."

While it's too early to get a firm idea of sales increases, Lang has already seen what she characterizes as "powerful incremental revenue" from rewarding members for registering their credit cards and then using them to eat in local hotel restaurants.

This kind of insight alone is worth every dime, she says. Her major measurement of success for the project would be, in two years' time, to increase the proportion of hotel guests who are Kimpton Karma members from 30 to 40 percent. "If I can measure that in a couple of years, I'll say it did its job and paid for itself."

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ABOUT THE AUTHOR

Susan Kuchinskas

Susan Kuchinskas has covered interactive advertising since its invention. The former staff writer for Adweek, Business 2.0, and M-Business covers technology, business and culture from Berkeley, CA.

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