Leading Hotels' Tech Trip-Up: How Online Promo Went Wrong

Snafu Caused by Overwhelmed Website Underscores the Risks Marketers Take in Age of Consumer Control

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CHARLOTTE, N.C. (AdAge.com) --It was an online promotion that went awry -- and then the backup plan went haywire as well.

But Marshall Calder, senior VP-marketing for New York-based hotel chain Leading Hotels of the World, is going to try again. "The Leading Hotels of the World is all about promise, and this was a promise that we made," Mr. Calder said. "Protecting the integrity of the brand is absolutely paramount."
Ted Teng, president and CEO of Leading Hotels
Ted Teng, president and CEO of Leading Hotels

In a case study of how technology can sometimes fail a brand, Leading Hotels of the World -- with 450 luxury hotels in North, South and Central America; Asia; Europe; and Africa -- advertised a promotion last month to celebrate its 80th anniversary. It offered consumers a chance to win two nights at any of its properties between Nov. 1 and Dec. 15 for $19.28 each night.

The company made 3,000 rooms, or 6,000 hotel nights, available for the promotion.

Neither Tag, Leading Hotels' ad agency in Miami, nor TIG Global, its interactive shop in Chevy Chase, Md., was involved in the promo.

Too popular
"Much of it was handled in-house, with a lot of it online, a lot of one-to-one marketing," Mr. Calder said. "We contacted many of the customers in our database, it got some press pickup, and it got a lot of mention on blogs and travel sites. It really took off."

Maybe too much. Some 150,000 people registered for the promo and were directed to a dedicated site Oct. 1 to attempt to book the $19.28 rooms.

The site crashed almost immediately. Most people were shut out; those who did get into the site were not able to book any rooms.

So Leading Hotels of the World put in place its backup plan. It responded later that day with an e-mail to the registrants, apologizing for the fiasco and asking them to fill out an attached form. The form asked for three choices for a hotel, and two choices of dates for each of the three hotels selected. The form was then to be e-mailed back to the company on Oct. 2, starting at noon Greenwich Mean Time. Entrants had 80 minutes to do so, but any forms e-mailed back prior to or after the date and time specified would be invalid.

But the backup plan didn't go anywhere either. Later the night of Oct. 1, another e-mail was sent to would-be participants from Ted Teng, president and CEO of Leading Hotels. Mr. Teng wrote that the promotion was being postponed, that there was "some confusion over submission procedures and timing. In addition, we have become increasingly concerned that a large number of nonregistered respondents plan to submit forms, which would inundate the system."

'Complete failure'
"It was a failure," Mr. Calder said. "We admit it -- it was a complete failure. It was an application failure. We farmed it out, had a number of vendors involved. But we ended up saying, 'Let's take it out of the market entirely and re-engineer this thing so we're able to fulfill our promise.'"

Pete Blackshaw, exec VP, Nielsen Online Digital Strategic Services, Covington, Ky., said this is the risk companies take in the age of consumer control. "There's so much distrust these days about promotions, fueled ... by spam and fly-by-night scammers," he said. "Consequently, consumers have a shorter fuse, so it's critical to execute with near perfection and never mismanage expectations."

Mr. Blackshaw added that companies have to protect their brands because "consumers are leaving a digital trail of venom" when something goes wrong.

Mr. Calder said original registrants for the company's $19.28 promotion will be hearing from the chain soon.

"It's fair to say we have a solution in mind," he said. "We have gone out to the best-of-breed vendors in the industry to ensure we have sufficient capacity and can handle the surge. We're going to go out with a Round Two of this promotion in time for the people to avail themselves of the first date the rates take effect, which is Nov. 1."
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