Free DM Is Reward Program's Incentive

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Rather than free trips and hotel stays, a chain of Mexican hotels is trying a campaign that rewards travel agencies with free direct marketing.


The program comes at a time when the Internet and other avenues are heightening the level of competition for travel bookings.


"We still feel that [travel agencies] are the driving force of the industry, and we wanted to do something to help them," said Jim Begley, marketing manager for Mexican Tourism Marketing (MTM), Houston, the hotel chain conducting the campaign.


MTM says its promotion, which began earlier this summer, marks the first time direct marketing has been offered as a reward. But the program is unique for the travel industry not only because of what it offers as an incentive, but because of who the incentive is offered to.


"Most incentives are agent-oriented. That's all well and good. We do that too sometimes, but this is an agency promotion," Begley said, noting that agents often directly receive cash rewards, prizes, travel and higher commissions as incentives. "No one is really looking out for what the agency needs. Hopefully, this is more broad in scope."


The way the program works is that agencies collect points through booking trips to MTM's hotels, which include Continental Plaza Hotel Resorts, Plaza Las Glorias Hotels & Villas and Hotel Sierra. Generally, agencies earn one point per booking, but for bookings at some lower occupancy hotels or for some special land and air packages they can earn two or three points.


Once an agency has collected 12 points, it wins a postcard mail drop to a neighborhood of its choice. Using a tactic borrowed from the real-estate industry, the agency selects an address to be the center point of the mailing, and MTM will use the U.S. Postal Service's residence listings to mail postcards to 200 residences in the area surrounding that address.


"It's really common in that industry that if someone sells a house, the agency sends cards around the neighborhood saying, 'Look what we sold.' And I think travel agencies and real-estate agencies have a lot in common," Begley said.


The cards used for the mailings were created in-house and feature scenes from Mexico on the front. On the back, there is a choice of six messages promoting Mexico's attractions -- with one inviting travelers to escape from the cold, another touting Mexico as a "magical world of history and romance" and another suggesting that going to Mexico is the perfect way to get away from workplace stress. The postcards prominently feature the travel agency's name, address and telephone number and include the names of MTM's hotel chains in small print on the bottom of the card.


As a bonus, when agencies earn 36 points and their third mailing, they are given a three-night hotel stay for one person and a companion.


The program packet, which includes a form in which travel agencies can list their bookings and select their favorite message, was sent to travel agencies through Travel Agent magazine, the largest magazine in the industry, Begley said. In addition, the company placed full- and half-page ads announcing the program in that magazine and other trade publications. MTM also has been promoting it through broadcast faxes and breakfast seminars in cities across the country. So far, breakfast seminars have been given in Houston, Chicago, Phoenix and Tucson, with many more scheduled for fall, which is when travel to Mexico typically intensifies.


While the company hasn't yet received completed forms, it has heard a great deal of positive feedback. Based on the feedback and the amount of time it generally takes for agencies to earn certain amounts of bookings, Begley expects to conduct postcard campaigns for 50 to 100 agencies at the end of this month.


"I think that's a conservative estimate," he said, noting that there are 33,000 travel agencies in the country. "Just 1 percent would be 330 agencies, and that would be an enormous amount of bookings for us."


The company has budgeted $100,000 for the program, which includes the cost of designing the postcards, printing promotional materials and program advertising, but doesn't include the cost of processing the postcard campaigns once agencies have turned in their 12 points. Those mailings are expected to cost $60 per agency, Begley said, but added that it would cost more for individual agencies to create a similar campaign.


Scott Winston, senior vice president of sales and marketing at International Tours & Cruises, New York, said he was aware of the campaign, had made between six and nine bookings at MTM hotels since the program's launch and planned to complete the form to earn the postcard mailing. While acknowledging that the program was unique, Winston didn't think the incentive was enticing enough to convince agents to book stays at MTM hotels above other comparable hotels in Mexico. The industry is flooded with incentives, he said.


"We get everything -- tickets, hotel stays, TVs, executive chairs for the office, lunch or dinner for the entire office," he said.


However, Begley noted that the postcard is being offered in addition to the commissions and bonuses that the company routinely offers agents for bookings.


MTM intentionally launched the program in the summer, when travel to Mexico is relatively low so it would be more established during the busy season.


"The idea was to use summer as a springboard for the busier fall and winter seasons," he said. "I think this is something that will keep growing once the ball gets rolling."


The company's three hotel chains include 30 properties in 20 destinations throughout Mexico and Southern California.
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