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we did a Crowd Cut (like Groupon)

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toddburme

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As you know we are newer and less full then we want to be. So we just did a crowd cut and they let us do sun-thurs. We sold 225 so far as it is still going on and we get 66% of the sale. I know this is not a popular thing on the forum here but sharing the info as we did it. If it hurts or helps you can see it in real time. We have had about 30 reservations so far and one person paid full price to stay on the weekend instead of doing the deal. Web traffic is through the roof but our target area had a huge storm yesteday, and I am sure that hurt us a bit. Not getting any conversions on the extra traffic (yet?).
the deal - http://www.crow SPACE dcut.com/minneapolis-stpaul/deal/quill-and-quilt-bed---breakfast/10005237
 

Alibi Ike

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If it is working for you, bringing in biz you didn't have anyway, and you're getting 66% instead of 50%, then that sounds pretty good.
I think what some of us have a problem with is that the customers are being sold a gift certificate which in many places never expire. Someone could show up here 5 years from now and hand one over. Expiration dates do not apply. Restrictions do, but no expiry dates.
 

toddburme

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I think that is still in court but yeah i understand the risk.
 

JBloggs

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Todd pls keep us posted on your experience with this. I hope it all works out well!
 

Copperhead

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Todd - best of luck to you on this, hats off to you for trying this! ... Keep us informed as to how it works for you, now and down the road. My feelings about these? the jury is still out. I have several friends with B&B's that have had good experiences (so far). It IS great exposure and only you can determine if the price you paid for the promotion was worth it. And there are many factors to determine the value...
Well I have been looking into the expiry issue for these special deals. This is how it has been explained to me:
These are promotional packages and have a set VALUE to them... some are bundling extras to entice the purchase. You set a expiry date lets say 6 months or a year. Some States have GC laws for 5 years or never expire... So what expires in the period set is the promotional part - discount off the room, the extras etc. The actual price paid becomes the GC value and good for redemtion for only that amount. So lets say the person bought a deal for 1/2 off carpet cleaning for $30 extras include stain guard & ???, once the expiry date passes they end up getting $30 off their next service - in other words face value of the GC they hold.
They are battling this in some state courts right now... My advise would be to check with your state before venturing into one of these deals. As with any agreement you want to read all the fine print before signing on the dotted line.
 

Alibi Ike

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Todd - best of luck to you on this, hats off to you for trying this! ... Keep us informed as to how it works for you, now and down the road. My feelings about these? the jury is still out. I have several friends with B&B's that have had good experiences (so far). It IS great exposure and only you can determine if the price you paid for the promotion was worth it. And there are many factors to determine the value...
Well I have been looking into the expiry issue for these special deals. This is how it has been explained to me:
These are promotional packages and have a set VALUE to them... some are bundling extras to entice the purchase. You set a expiry date lets say 6 months or a year. Some States have GC laws for 5 years or never expire... So what expires in the period set is the promotional part - discount off the room, the extras etc. The actual price paid becomes the GC value and good for redemtion for only that amount. So lets say the person bought a deal for 1/2 off carpet cleaning for $30 extras include stain guard & ???, once the expiry date passes they end up getting $30 off their next service - in other words face value of the GC they hold.
They are battling this in some state courts right now... My advise would be to check with your state before venturing into one of these deals. As with any agreement you want to read all the fine print before signing on the dotted line..
OK, so this makes sense to me. That eventually the purchaser is holding a GC valued at $x and NOT a room at $x. NOW, what has to be taken care of are places that sell tons of these they don't plan on honoring for the actual, original pkg. (And we know there are businesses out there that would do something like that. Bait & switch.)
 

Copperhead

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Todd - best of luck to you on this, hats off to you for trying this! ... Keep us informed as to how it works for you, now and down the road. My feelings about these? the jury is still out. I have several friends with B&B's that have had good experiences (so far). It IS great exposure and only you can determine if the price you paid for the promotion was worth it. And there are many factors to determine the value...
Well I have been looking into the expiry issue for these special deals. This is how it has been explained to me:
These are promotional packages and have a set VALUE to them... some are bundling extras to entice the purchase. You set a expiry date lets say 6 months or a year. Some States have GC laws for 5 years or never expire... So what expires in the period set is the promotional part - discount off the room, the extras etc. The actual price paid becomes the GC value and good for redemtion for only that amount. So lets say the person bought a deal for 1/2 off carpet cleaning for $30 extras include stain guard & ???, once the expiry date passes they end up getting $30 off their next service - in other words face value of the GC they hold.
They are battling this in some state courts right now... My advise would be to check with your state before venturing into one of these deals. As with any agreement you want to read all the fine print before signing on the dotted line..
OK, so this makes sense to me. That eventually the purchaser is holding a GC valued at $x and NOT a room at $x. NOW, what has to be taken care of are places that sell tons of these they don't plan on honoring for the actual, original pkg. (And we know there are businesses out there that would do something like that. Bait & switch.)
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Yes there are those that will try this. I don't know anything about the one mentioned in this thread, but I know LS and Group -on both have clauses about such in their contacts... and if they get such complaints from purchasers, they will demand return of payment as a breach of contract.
 

Generic

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Good luck and I hope it fills your rooms and you are happy with it.
Our trepidaiton is related to the fact that original value here (in our jurisdiction) never expires. So if they pay $89 for it, it's still worth $89 until the day we close and we have to list that liability on our balance sheets, even though we got $59 for it. The promotional value... that can expire. It's a jurisdictional problem.
But I did see that you limit it to Sunday to Thursday, stick to your guns on that. And hopefully they will be leaving some tips as well. You will need it with one day stays, that's going to be a lot of laundry. And hopefully you can upsell them on something.
255 purchases. So you have 5 rooms and 4 nights, so 20 nights per week available. About 13 weeks worth of guests. A respectable amount. Not like some of them that went off the deep end and booked more than a year's worth of reservations. It should get you some guests and some good word of mouth. Good luck!
 

toddburme

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It rose to over 300... but yeah we ok. Yes this then turns into a GC that never expires. Thus there is a risk to it. We are getting a few that are booking two nights. Obviously the majority only book the one night and that is that. We had a couple that found us through this but wanted a weekend so they just skipped the deal and booked the weekend.
Once it turns into a GC, we can then make it as a GC for any night. So they book a weekend night at 189 say and we lose $30 to the deal. I can live with that.
I know i have lost GC's or let them go or whatever so i know people do that. An emtire business model based on the customer not using your service is a bad idea so i am not thinking this is going to be the core of our B&B income.
 

toddburme

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So far we have about 50 reservations out of the 329 sold. And we are liking the fact that we are getting lots of infill on our week nights. Where as we would have one person on thursday, now we have two etc.
 

JBloggs

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So far we have about 50 reservations out of the 329 sold. And we are liking the fact that we are getting lots of infill on our week nights. Where as we would have one person on thursday, now we have two etc..
toddburme said:
So far we have about 50 reservations out of the 329 sold. And we are liking the fact that we are getting lots of infill on our week nights. Where as we would have one person on thursday, now we have two etc.
Todd I hope you can upsell some items, like flowers etc - things not included in the orig package. If it were me, when I sent their confirmation I would have a nice photo with the choices to add-on, to innhance their stay. Try to get some more $ out of them! They might think, hey we got this on a crowd cut, so why not!
 

toddburme

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Yeah we upsell the massage and the second night. Overall the business model is based on the fact that people buy impussively and never use it. Tonight we have 3 crowd cut and two normal for a full night but in this case our added cost versus what we take in is pretty decent. if 100 percent of the people book then obviously we will not make money on it.
 

Copperhead

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Found the website and checked the demographics, this is very interesting! (same as what Groupon reports) Want the young - WTH - crowd? Looks like this is a way to pull them in!
69% 34 and under; 75% employed full time, (10% retired); and 69% of them make $50K or more. Also 80% have a college/ grad degree and 77% are female. 49% single, 33% married.
www.crowdcut.com/Business/Demographics/
 

toddburme

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Take that with a grain of salt as i am a member and i never gave any info like that.
But I was thinking that these coupon sites are helping the Bed and Breakfast industry get exposure. Maybe we will train a new group of people to like B&B's. :)
 

Copperhead

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Take that with a grain of salt as i am a member and i never gave any info like that.
But I was thinking that these coupon sites are helping the Bed and Breakfast industry get exposure. Maybe we will train a new group of people to like B&B's. :).
Not sure how this data was compiled but the data was almost the same (some 1-2% different) on the Groupon site. I was not asked to complete any questions when signing up either, but I have not purchased anything. Maybe they have a survey if you purchase?
I think they are a new way to gain exposure to any type of business. Exposure is the name of the game!!!
Let's see how this play's out.... Would you keep a ledger of the age groups (your guestimate) of the people using the coupons at your place? Group 18-34, 35-44, 45-54, 55+
Compare this with the guests you obtain from your other sources. Let us know how this plays out.
 

toddburme

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Ok we can try that. I have bought lots of stuff at groupon and livingsingle. so far no survey or at least not one that I answered.
 

Proud Texan

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Take that with a grain of salt as i am a member and i never gave any info like that.
But I was thinking that these coupon sites are helping the Bed and Breakfast industry get exposure. Maybe we will train a new group of people to like B&B's. :).
toddburme said:
Take that with a grain of salt as i am a member and i never gave any info like that.
But I was thinking that these coupon sites are helping the Bed and Breakfast industry get exposure. Maybe we will train a new group of people to like B&B's. :)
OR it's going to train that same group to only book if they can get a deep discount. Those of us with small B&Bs can't afford to do this and won't. You want cheap? Go to Motel 6.
 

toddburme

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Take that with a grain of salt as i am a member and i never gave any info like that.
But I was thinking that these coupon sites are helping the Bed and Breakfast industry get exposure. Maybe we will train a new group of people to like B&B's. :).
toddburme said:
Take that with a grain of salt as i am a member and i never gave any info like that.
But I was thinking that these coupon sites are helping the Bed and Breakfast industry get exposure. Maybe we will train a new group of people to like B&B's. :)
OR it's going to train that same group to only book if they can get a deep discount. Those of us with small B&Bs can't afford to do this and won't. You want cheap? Go to Motel 6.
.
possibly but lots of folks are being exposed, it is possible they will see the value.
The check hit the account and I have to say that is a big boost to the cash position.
 

toddburme

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Revisited - We have had 100 people of the 320 or so book so far. About 67 have stayed. We blocked out the weekend so the Crowd Cut people only could book during Sun to Thurs. At the time this seemed super smart. BUT then you get a random person on Wed night and you are giving them a huge discount.
The thing that is not good, is that our arrangement is pretty hands off even for the innkeeper so all of these extra folks at a reduced price was considered a benefit to the staff at first as obviously we had very few bookings. Now during the busy season it is a pain.
Last Sunday when the President came to town, we were full with Crowd Cut people and missed the CNBC film crew. Ouch. But if we are full even with the discounted people then that is a profitable night. And who knew the Pres was coming?
Obviously a few months into it, the first Crowd Cut is looking ok but you always have that outstanding liability. Remember we just opened so our calendar was pretty empty being this is the first year. We felt it helped us get organised quicker by getting people in the door. I still feel the jury is out if it is even a good idea.
So we are thinking of doing a winter one for 6 months starting in Nov, a 2 night stay on any night and only in a queen bed room. We noticed the Crowd Cut people all booked the most expensive room as it was one price fts all. Makes sense. We were thinking if we could add one or two bookings a weekend during the winter, it would add to efficiency as we would be fuller. We also get the money of course. This was the original plan as we are super slow in the winter months.
 
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