A Thought Popped Into My Head....

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Generic's picture
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I was thinking today about all the reservations that I get through third parties. I get paid less, because of the commission, but they actually pay more because I offer a special online discount that gives people who book directly 10% off (2 days or more). Yet these people still have been drawn to third party websites... and some of them come back. When they come back, I want them to book directly. 

So, I was wondering, what would happen if I gave them a special GC (well, it looks like a GC but really it's a discount voucher) that offered $X off of their next stay (2 days or more). They can use it, or they can give it to a friend. But you have to have the certificate to use it. One per stay, cannot be used for consecutive stays. 

Anyone try this? Should I give it with an expiration date? No expiration date? Obviously it can only be used for direct reservations. Would you personalize it or would you leave the name open, so they can give it to a friend (after telling their friend all about it)? And of course it has no cash value, since they didn't purchase it.

What do you think? Would you print it on the back of a special business card that you give them or would you make a full "certificate" for it? Or would you print a plastic card instead? What do you think of this idea? Would you do this for all guests? Only guests that book through third parties? 

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Eric, I think it is a great ideaenlightened and one I may stealwink

In the early years we did fridge magnets for neighborhoods around us and offered them a discount for visiting family/friends. (no expiry)  It did a great job, for about 5 years people called and referenced the code we provided.  A good long run for the investment.  

Question here:  You state you give a discount for people booking online (and if my memory serves that you also only take online reservations) so would these people get the online booking discount AND this special incentive as well?   If not, you need to be very specific on the card. 

I like the business card idea with maybe a stamp on the back.  

While the card may not have an expiry, you could tell them 'we hope you will return next year and use this'

And an FYI - for some people it is not because they think they are getting a deal, they use these 3rd party sites because they feel they have some added protection if need be especially when dealing with independent properties.   I feel this is the case with the booking I got through bookin g.c om yesterday.  They had looked at my ResKey page 3 times, one just minutes before I received the notification through b.com.  I surmised it must be their comfort zone.  (booking from Germany)

 

Generic's picture
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Let's say my regular rate is $220 per night. When you book online with the instant discount for 2 night stays, you get 10% off. So while one night is still $220, when you book more nights it goes down to $198. But if I'm paying 20% commission on the $220, it means that I'm actually getting $176 a night ($352 for two nights). If I take $25 off of the $198 per night ($396 for two nights), I get $185.50 a night, so I get more money and a build a new habit.

Besides, think of the return on publicity that I get. They can talk about it to friends, if they aren't planning on coming back and give them the certificate. Or they put it somewhere where they see it and get reminded of us, etc. It's built in publicity. And how many of these will really come back? I will put down that it's one gift certificate per reservation and no concurrent/back-to-back reservations. Don't want them to start to collect them for a free stay, though that could be a reward program, but only if we put their name on it, which would negate the value of being able to give it away to someone else.

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We have successfully avoided the 30% surcharge on 3rd-party reservations this way:

 

Within a day or so after we receive notification of a reservation we call (assuming you have a phone #)

"Hi!  This is the ******Inn calling to confirm a reservation just received for ********. 

Is **********available?  Guest Answers). 

Hello Mr/Mrs*********, this is ********Inn and we are calling to confirm your reservation we just received for an arrival on************and a departure on**************.

(Small talk ensues). 

By the way Mr/Mrs***********, we noticed that your reservation was made through an external web portal instead of our own website.  Unfortunately it appears that you paid more than you needed to. (Guest gets bewildered and puzzled). 

"Not to worry though, Mr/Mrs.********.  You probably received a confirmation from that booking agency along with a toll-free number to call if you need to cancel for any reason.  You can cancel your reservation made through them, typically free-of-charge.   Then, just call us back directly at (your phone number) and we will book you at a lower room rate!"

This strategy works  for us most of the time - when we have a phone number to call.  A few times it's a business person who couldn't care less (on the boss's nickel) OR they get some kind of "points" from a card or program with a higher value than the savings.

Generally, though, it has worked VERY well for us,.  You can recoup HUNDREDS over the course of a year.

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Book in g .com especially keep a track on your cancellation rate and if it is too high they put you under a microscope - I wouldn't risk it especially with the amount of business they send me.

They use 3rd party sites because they don't understand how much commission we have to pay - most are horrified when I tell them 15% and up, I always say look at these sites and find where you want to be then book

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I called booking.com to find out why they think my cancellation rate is so high. No idea. They're not rebooking directly so I have nothing to go on. They don't tell me why they canceled.

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hearthstoneinn wrote:

We have successfully avoided the 30% surcharge on 3rd-party reservations this way:

 

Within a day or so after we receive notification of a reservation we call (assuming you have a phone #)

"Hi!  This is the ******Inn calling to confirm a reservation just received for ********. 

Is **********available?  Guest Answers). 

Hello Mr/Mrs*********, this is ********Inn and we are calling to confirm your reservation we just received for an arrival on************and a departure on**************.

(Small talk ensues). 

By the way Mr/Mrs***********, we noticed that your reservation was made through an external web portal instead of our own website.  Unfortunately it appears that you paid more than you needed to. (Guest gets bewildered and puzzled). 

"Not to worry though, Mr/Mrs.********.  You probably received a confirmation from that booking agency along with a toll-free number to call if you need to cancel for any reason.  You can cancel your reservation made through them, typically free-of-charge.   Then, just call us back directly at (your phone number) and we will book you at a lower room rate!"

This strategy works  for us most of the time - when we have a phone number to call.  A few times it's a business person who couldn't care less (on the boss's nickel) OR they get some kind of "points" from a card or program with a higher value than the savings.

Generally, though, it has worked VERY well for us,.  You can recoup HUNDREDS over the course of a year.

And don't think the 3rd party sites won't catch on to what you are doing and may remove you from the site.  They do have 'shoppers' too and they may book just to check. 

I am thankful for these sites as I feel they provide a marketing service that I may be lacking.  They do have a following (as do some directories) and for that, the ones that book through them I would have never gotten on my own with my other marketing.  That to me is worth the 15-30% depending on who you are listed with. 

As with Eric I want them to return but to book DIRECT when they do. 

Madeleine's picture
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I haven't had to do that, most of the people who booked thru 3rd party sites have canceled themselves within days of making the rez. No, they don't book directly with me, they just realized that they can get a room for 1/3 of the price by staying 2 miles away.

Generic's picture
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Don't want to do that, just want them to book direct the NEXT time or tell friends who will book direct. Smiling

Madeleine's picture
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I hadn't thought about it but it sounds like something you could do.

Yes, use your biz card, that can easily be put in a wallet or purse. Write it in on the back with an expiry date and tell the guest, 'Book directly with us for you next stay and use this as a thank you from us.'

If they don't understand, and so far a LOT of my guests have not understood they did not book directly with me, explain they used a 3rd party service with no discounts and you're offering them a discount to book thru you for their next stay. Or, say it's on your website to get a discount for booking directly and not using xyz booking service.

 

Generic's picture
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Do you think people will value it more if it has a serial number?

Madeleine's picture
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Eric Arthur Blair wrote:

Do you think people will value it more if it has a serial number?

I'm torn on the benefit thing. Here's why...9/10 if I buy something online the next day I get a coupon to save on the exact thing I just bought. At the pharmacy they give me coupons all the time for stuff I just bought. And I am not going to need that again in 5 days when the coupon expires.

So, the coupon/savings have to be for an extended period. 9 months? A year? Do you want to track this stuff?

In re the serial number, good one. What number do you think would make an impression? 00005? 5? 005? 199?  I'd pick one number and just go with that.

How about some sort of stamp instead? Official looking dater or something.

Generic's picture
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Hmmm, they don't have to know that it's a repeating serial number. Damn, didn't think of that!

I don't want it to have immediate value, because I do get people who fly in and out of here and I'm a reservation on both ends. I want them to put it on their fridge to remind them of us, to come again, to give it to a friend who's thinking of coming. I want it to have perceptive value, even if it doesn't have a lot of real value. $25 Gift Certificate, good from _____ (next month). You may use it or you may pass it on to a friend. May be combined with any other discount. Minimum 2 nights. (No cash value, valid on accommodations only.)

If you put an expiration they will think it's a coupon. If you don't, they may value it as a gift certificate. In fact, that's why I was thinking plastic card might hold even more value in their minds. 

Do you throw out coupons? Do you hold on to them? Do you throw out gift certificates with values on them? Do you hold on to them? Would you pass it to a friend? 

Madeleine's picture
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I throw out stuff with an expiry date. (Except BB&B coupons which are good forever.) A GC that was expired I would throw out. I would hand off an unexpired coupon/GC if I could and knew someone could use it. I don't stick anything on the fridge unless it's from a kid. Except the magnets that hold it all up.

All of my unexpired GC/coupons are in an envelope that I riffle thru when I'm going to buy something.

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Then there are those that NEVER throw anything away apparently!   In the first year we opened (celebrating our 15th yr this summer) I put together a gift basket for a Unit ed Wa y raffle at my former employer.  The basket included a GC for a 1 night stay, stupid me did not put an expiry on the dang thing.  The work assoc. that won the raffle has reconnected with us via FB and has posted twice now that she STILL has the GC and wants to use it soon.  The first post was over a year ago.  How soon is soon?  

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Eric Arthur Blair wrote:

Do you think people will value it more if it has a serial number?

Do you use a an online reservation system like ResKey directly from your own website?  If so,  you may be able to create a discount code that would be entered when they made the reservation from your website.

Generic's picture
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Yes, I do. But, I don't want this valued that way. I can make discount codes until the cows come home. Discount codes have little value. People publish them on the web all the time. Look at VPrint, does anyone value them or simply wait for the next one in email. I want them to value it as if it's real cash, something you keep because it has value.

Here's 10% off... trash. He's $25 in cash for the next time you come... fridge magnet!

Proud Texan's picture
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We provide a discount code in our Thank You letters for 10% off a guests next stay.  We've had plenty of guests return, but only once in 5 years has anyone ever used the code.

 

Generic's picture
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But has it had benefits that are apparent, even if they didn't use it?

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I did similar with rack cards for our businesses here in town. I signed each one on the back to show them I was serious with the discount on it. I never had one return to me. I also sent thank you cards and refer a friend discounts, never got one of those either.  Because these type things sit on fridges with a magnet I might put a USE BY DATE on them.

I think people would appreciate it E.

 

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