By Jennifer Rodrigues
Q: Lately, I’ve been hearing a lot of buzz about websites like Groupon and Living Social. What exactly are these sites and should I be promoting my property through them?
A: For the past couple of years, “group buy” services like Groupon, Living Social, and others like WagJag, Jettsetter, Couptessa and PriceBunch, have been sprouting up around the Internet and are quickly becoming extremely popular among consumers. Through these sites, Internet users can take advantage of deep discounts-often more than 50%-at hotels, restaurants, spas and other attractions within a select locale. The “catch,” so to speak, is that each deal is only available for a certain amount of time-usually one day-with only a certain number of coupons available. There’s also a threshold, or minimum number of coupons the site must sell in order for the deal to become active.
For the consumer, these websites provide constant-and often hard to resist-items and services available for much less than regular price. Indeed, I, myself, have even purchased coupons on Groupon, recently taking advantage of 50% off at one of my favorite restaurants, as well as discounts on yoga classes.
But how can this type of service benefit hoteliers?
Much like the traditional group discounts used at hotels for decades, promoting your property through websites like Groupon and Living Social can give your hotel the flexibility to lower its average rate in exchange for a larger number of bookings. What’s also a huge benefit of the online “group buy” service is that it brings the power of bulk buying to different targeted local communities, rather than waiting for these groups to come to you.
While cutting your nightly rates by as much as 50 to 60% might seem like scary from a hotel’s perspective at first, the workings of these “group buy” services can actually allow your property to generate a significant amount of revenue-after all, as these websites usually keep a percentage of the money made from each daily deal, you can be sure they’re getting the word out through a strong social media presence and viral marketing strategies. In fact, many large hotel chains have jumped on the “group buy” train this year, with hotels like InterContinental Chicago; Hilton Hotel, Houston; Omni Hotel, San Francisco; and Clarion Hotel in Las Vegas all recently posting offering room deals via Groupon.
Moreover, many of the sites even offer a referral program for their subscribers. For instance, a consumer might see your hotel being advertised for 50% off on Groupon. After purchasing a coupon for themselves, they can post this same deal on their Facebook and encourage their friends to book the same deal and Groupon will give this user $10 for each referral.
So, in the end, your hotel might end up having several hundred consumers advertising it on their Facebook or Twitter, as well as a few hundred room sales-not to mention the potential for long-term clientele – from only one Groupon coupon.
Online group buy services can turn out to be extremely beneficial for both consumers and hoteliers; however, as a hotelier, there are a few things to consider before jumping on the Groupon (or Living Social, or Jetsetter, or Wag Jag…) bandwagon. Make sure your hotel is ready for a large batch of potential new customers. Group buy services can increase your occupancy, so make sure you’re properly staffed for the extra guests, and that your staff is knowledgeable about your product-from your food to your linens. Customer service can be a deal breaker when it comes to hooking new clientele and can play even more of an impact when a lot of new clientele is coming in at once.
After all, besides the potential of generating added revenue over a short period of time, the purpose of these group buy websites is to build a profitable business with long-term customers so it’s important that you make the best first impression possible with these new customers.
Jennifer Rodrigues, Visibility Development Manager with ThinkInk and TravelInk’d, is a seasoned public relations professional with a passion for the hospitality industry, which is expressed in her role at ThinkInk’s travel division, TravelInk’d. At TravelInk’d, she is responsible for developing cost-effective and creative public relations and marketing strategies for clients in the travel and tourism, airline, lodging, cruise and meeting/event sectors. For more information on TravelInk’d, please visit www.travelinkd.com or contact Jennifer at firstname.lastname@example.org. For more news about PR and marketing in the travel industry, follow TravelInk’d on Twitter @TravelInkd and visit the TravelInk’dFacebook Fan Page.