*Preferred Hotels Expands Its CRM, Data Warehouse Program

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Preferred Hotels and Resorts Worldwide, Chicago, is updating its data warehouse system to enable it to launch more targeted direct marketing programs, strengthen existing customer relationships and improve overall marketing efficiency.

Preferred is a $100 million global hotel and resort company with more than 110 luxury hotels and resorts, including L'Ermitage Beverly Hills, The Peninsula New York and Brown Palace in Denver.

The hotels are independently managed, and though that allows the properties to offer a high degree of customer service, it also creates "system issues that make customer relationship management a challenge," said Adrian Robert Bell, director of brand marketing.

While various property management systems capture customer transaction data, they are not technologically compatible among the hotels. As a result, Bell said, it is difficult to "harness the information that hotels are collecting on their guests, and warehouse it and aggregate it with information on those same guests at the other 109 hotels." In addition, the property management systems do not allow marketers to easily collect, tabulate and analyze customer preference information.

The company launched a database initiative about five years ago, but the system does not allow for properties to share data easily -- making customer relationship management difficult.

To help create a system that will enable CRM, Preferred turned this summer to CRM software and data-mining services company Opal Sky Inc., Toronto. Opal Sky's system allows for connectivity between property management systems and a central warehouse at Preferred's Chicago headquarters.

However, before implementing its system, Opal Sky has begun consolidating, cleaning and standardizing Preferred's database, which is located in several databases at its headquarters. The data include some customer and transaction information from properties incorporated in the original database systems, as well as sales and marketing data, and data from its partners, United Airlines and Neiman Marcus. The database also is being populated with data recently received from groups of travel agencies -- which are the main vehicles through which Preferred receives leads -- and from a series of direct mail programs it sent to Neiman Marcus customers. Preferred's data warehouse includes more than 500,000 people.

Preferred has begun segmenting the properties and matching them to customer interests. It recently classified properties into four segments -- spa, golf, classic and resort -- and created a brochure mailing piece for each category. Last month, it sent a test mailing of 1,500 classic brochures to customers in its database who had expressed an interest in that type of property in a business reply mailing or by phone.

However, in October, five hotel properties will begin beta testing the new Opal Sky system, which connects the property management systems to the Preferred data warehouse.

"We will start pulling the data out of our property management systems, aggregating it to the warehouse and then matching it with what we have already captured there," Bell said.

The goal is to have all 110 properties connected by early next year.

The system will allow Preferred to act as an agency to the properties, whereby they can analyze the data "and leverage joint customers and start cross-selling and upselling different properties," Bell said.

Preferred also will use Opal Sky's hospitality industry CRM solution, OpalSky.Travel, and its data-mining consulting practices to create, manage and execute CRM strategies and programs through direct-to-consumer communications, including e-mail newsletters and promotional mailings to drive incremental business.

Once a direct communication program is launched, "all of the responses will be driven back to our reservation system, and then we'd be able to track responses back to individual consumers who received specific direct mail pieces," Bell said. "All of this would be done through the Opal Sky system."

The system will help Preferred to "start understanding the people who stay with us every night -- not only to service them better, but [also] to communicate with them better and introduce them to other properties that they may never have realized," Bell said.

In the near future, Preferred will leverage the technology and relationships even further to capture and act on consumer preference information.

Bell said this system and a sophisticated CRM approach can help the company deliver a "hospitality business structure providing marketing expertise and services, multiple technologies, strong global brand management and a focused commitment on performance to independently owned and managed hotels and resorts and small, owner-operated hotel companies."

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