Hotels Use IT To Cut Costs, Lure Travelers

Cendant Corp., owner of several hotels and other travel-related properties, is getting IT more closely involved with its marketing and customer-service initiatives in an effort to give its franchisees a competitive edge.

Cendant next year will launch a membership-based customer loyalty program, dubbed Mega Loyalty, which will integrate programs from all of its brands and major airlines. Customers will have the option of crediting airline miles to their frequent-flyer accounts or to their Mega Loyalty accounts, which will include hotel and car rental programs. This option helps customers accrue and redeem points faster, according to Cendant. The Mega Loyalty program will let customers use the Internet to enroll, access their accounts, and redeem points. And Cendant franchisees will be able to inform customers about the new program via low-cost E-mail marketing campaigns, says Cendant.

Since its IT and marketing units will now be working more closely together on projects, Cendant plans to relocate its IT division in Phoenix to Parsippany, N.J., by April, says Ron Bialkowski, Cendant VP of hotel information technologies. "When you have all folks involved in one area, it's a lot easier to communicate, understand the business drivers, and deliver the technology to support the big projects we're working on," Bialkowski says.

Other hotel franchisers are also investing in technology to enhance their frequent-traveler programs and increase bookings. U.S. Franchise Systems Inc., parent company of Best Inns and Suites, Hawthorne Suites, and Microtel Inns and Suites, is helping its franchisees automate paper-based frequent-traveler programs in an effort to lower costs and to give customers more control over their accounts.

The redesigned Best and Microtel Web sites will let members of its Best Travel and MicroPass frequent-travelers programs check their account balance and keep track of accrued points rather than carrying membership cards that have to be stamped upon arrival at a hotel, says John Leven, U.S. Franchise Systems senior VP of marketing. "Automating the frequency programs streamlines the process for franchisees, because they don't have to deal with the administrative work of managing the customer's account," Leven says. Helping franchisees save money is more critical now because "business in the travel industry is suffering across the board," he says. The new Web site and Internet-based frequency programs will be available next year. Hawthorne, which is an extended-stay chain, does not have a frequency program.