Secret To Ensuring Peak Season Profits Continue
The surefire way to get a cashflow injection during low season so that you maintain healthy profit margins.
Peak season is now ending, and while costs are rising your revenue is lowering, the hidden opportunity though comes from the fact that people are now starting to look for Christmas Gifts.
Designing the right vouchers will result in immediate cash flow injection because you get the cash instantly and with the majority of vouchers when redeemed you can direct the booking to a quieter period and have the double of extra spending in the accommodation during the slow times.
Vouchers can result in sharp revenue increases and if promoted correctly also do a great deal for your brand exposure in a busy digital world.
As an accommodation provider, your focus should be on high value based packages and bundles. Craig and I are big advocates of building packages and deals rather than discounting.
Why build packages and deals?
Businesses across a range of industries have discovered that customers come to expect discounts, but they don’t on package deals or bundles. Built correctly packages and bundles increase profit margins and mean that you can sell fewer rooms for more money.
Let’s have a quick look at how this might work –
Goal: £1,000 Profit
Room Price: £100
Profit Margin: 30%
Standard Room Price Deal
To achieve the £1,000 Profit goal I would need to sell 34 Rooms
This is based on making £30 profit per room sold and costs being £70 per room
10% Discounted Room
To achieve the £1,000 Profit goal I would need to sell 50 Rooms
(That’s an extra 16 Rooms!)
This is because I’m only making £20 profit per room!
Play and Stay Golf Package
On this package, I include a FREE round of golf (Worth £20) and FREE golf buggy hire (worth £20). Both of these have not cost me anything!
I decide to sell the room now at £110 because the guest will see a total value of £140!
Saving them £30! Great value to them!
Now my costs remain static at £70, just like in the original deal.
My profit per room is £40 instead of just £30 on the original deal or £20 on the discounted package.
Now, I only need to sell 25 Rooms! That is half of what I would need to sell if it was a discount package and 9 less than the original package.
Marketing this offer to the right guest persona will mean that the package is also easier to sell and I increase my chances of smashing my profit goal!
This is why packages and deals are the best routes to go, more money for less work.
Vouchers must be designed well and connect with your perfect guest personas. You want to capture the imagination and drive impulse purchases.
Where can you promote your vouchers?
‣ Organic Social Media Posts
By posting your vouchers on social media, you will get free exposure and purchases. Your audience can also share the offer with other people and increase your reach massively.
‣ Pay Per Click Advertising
You can get amazing results on Facebook Advertising because you can find with laser-focused accuracy the people who will buy your vouchers.
You can use the Facebook Pixel to show a voucher to people who have visited your website and not purchased.
You can send out special offers to your existing email database. Response rates to campaigns of this nature are usually pretty high because the recipient knows you.
Which parts of the guest purchase journey can you sell them?
‣ Prior to them booking accommodation
This is the most common place Hoteliers sell vouchers, and the most common purchase is gifts for friends, family and colleagues. This is not to say that people will buy vouchers for themselves.
Vouchers that include staying at your accommodation are mostly redeemed over the phone, and this is where you can direct the booking to a quieter period.
As these vouchers are often purchased as gifts, you need to give some additional thought to who the buyer is and who the beneficiary of the gift maybe, in other words, you have two buyer personas to consider.
‣ What are their demographics?
‣ What are their hobbies and interests?
‣ What is their average salary?
‣ What might they spend on a gift?
A husband buying a romantic weekend break gift budget will be different from a friend buying a gift for another friend.
‣ After the guest has booked accommodation
This is a massive area to drive upsells and boost profits quickly. When a booking comes through a channel where you have an email address you can instantly send a voucher for a spa treatment or a meal.
For maximum results, the price should be positioned at the impulse purchase level.
Imagine for a moment on your booking engine or online travel agent you have a romantic weekend break for £150, it includes dinner and wine.
The buyer sees £150, decides that is too much for them and buys a basic room at £100.
This is where selling psychology can work its magic when they receive a voucher on email for dinner and wine £35 (yes, you’ve lowered the price but still more than covered your profit margins!) the guest only sees a £35 cost which ‘feels’ small and great value.
What are the chances they will buy? I would personally say “very high”.
Voucher Ideas (In the podcast Craig reveals some secret ideas in addition to these!)
– Monetary Vouchers
– Lunch and Dinner Vouchers (e.g. dinner for two & a bottle of house wine)
– Afternoon Tea with Glass of Champagne or Prosecco
– Overnight Stay Package (with Afternoon Tea)
– Gourmet Break (overnight stay with dinner)
– Spa Packages – Leisure & Sports Vouchers
– Combined Packages (e.g. Spa + Afternoon Tea)
– Special Offers
– Loyalty Offers
– Seasonal Offers
Top Tips to Selling Vouchers
- Build the offer to fit a guest persona or profile.
- Take advantage of setting the value of a monetary voucher higher than the purchase value. People buying gifts love when they can purchase a voucher for a lower amount than the voucher is worth, especially if the voucher says how much it is worth on it. They feel like they’ve got a great and deal when they give the voucher as a gift the person thinks they’ve had more spent on them.
- Think creatively – Write headlines and descriptions that capture attention.
- If the package has a great deal of value built in, show that to the buyer.
- Build packages and bundles using resources that will cost you no extra
- Do deals with local businesses, ask them for vouchers to their establishments. This allows you to create amazing packages that cost you no extra.
- Compare the price to when items being bought separately and at peak season amounts.
Your weekly marketing news
Facebook will be updating the algorithm to include page load speeds.
Originally Posted on Adespresso
What does this mean?
If you are posting links to your website and your website loads slowly, it will show the post to fewer people.
The follows pretty much in line with what Google has done.
Key ways to increase speed
– Make sure you have a great host for your website
– Make sure your images are correctly sized
– make sure your images are properly compressed.
New Ebook Released to help Hoteliers get better results online
Originally Posted on Hospitality.Net
TrustYou releases new ebook called ‘Branding Without A Brand Name – An Independent Hoteliers Guide To Building Brand Value.’
The book has been designed to help independent hotels overcome the David and Goliath challenge in a digitally branded dominated world.
Chapters covered in the book include
– How to make the most out of a hotel’s unique value propositions
– Why having a properly optimised website is key to bookings and revenue
– The importance of online reputation management in marketing
– How to personalise daily operations and hotel-guest communication
Top Travel Branded Named – Thomson and Book.Com
A recent has discovered that travellers favour established brands and online travel booking sites. While this may not come as a surprise, the reasons are interesting and something that we can learn from.
Top 3 reasons consumers remained loyal:
53% Service Experience
40% Loyalty or reward scheme
What customers want more in travel brands:
✅ Value for money (59% said this is important, notice this does not say ‘discounts’!)
✅ Convenience (58% said this is important)
✅ Good customer service (58% said this is important
The article goes on to give tons of useful information, well worth a full read
Increased Investment in Scotland could lead to price increase
As we’ve reported in past episodes, Scotland is seeing massive growth and investment with overseas investors pumping £51.3 million in the first six months of 2017.
This article explains that this investment is expected to continue and maybe owners should start increasing their prices to maximise their returns.