Flash Sales Promotions Receive Mixed Reviews From Global Hoteliers

TravelClick Offers Best Practices for Hotels to Fill Low Occupancy Periods

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Apr 04, 2012, 08:30 ET

NEW YORK, April 4, 2012 /PRNewswire/ -- Despite the immense popularity and relative newness of flash sale websites such as Groupon, BloomSpot, JetSetter and Living Social, the jury is still out on the effectiveness and real value of these sites for a hotel's marketing plan.

According to a recent survey from TravelClick (www.travelclick.com), a leading global provider of revenue generating solutions for hoteliers, 40 percent of the approximately 900 global hoteliers surveyed have used a flash sale website. Of the 40 percent who have tried these sites, 38 percent have found it less successful than they had hoped and do not plan to use again. Hoteliers believed that the sales gave up too much revenue to the site operator (25 percent), did not attract the right caliber of customer reflective of the brand (21.7 percent) and did not see enough return business from the promotion (21.7 percent).

Nearly 40 percent (36.9 percent) of those surveyed have not tried a flash sale promotion and have no interest in executing one in 2012, while 23 percent say that they will try a flash sale site for the first time this year. When asked which flash sale website hotels chose to use, the majority (53.3 percent) of hoteliers polled had partnered with Groupon.

"Flash sales can drive considerable demand during low occupancy periods; however, there are many benefits and risks to this approach that require hoteliers to first weigh all viable distribution options. Compared to other channels, flash sales can provide a quick lift in room growth in a short time. However, most flash sales carry a high distribution cost due to steep discount and commission requirements," said John R. Hach, TravelClick's Senior Vice President, Global Product Management. "Hoteliers must remember that using the right tools, at the right time, and developing smart promotions will not only fill immediate occupancy needs but also enable them to build direct relationships with potential customers for the long term."

TravelClick Best Practices for Filling Low Occupancy Periods:

GDS Marketing -- GDS Advertising offers the unique ability to target prospective guests based on reservation trends specific to arrival date.
Retargeting -- Retargeting allows hoteliers to target potential customers, through online ads, who visited their website but did not book a room
Opaque OTAs -- Running promotions on opaque OTAs enables hoteliers to move inventory at a deep discount but keep the brand intact because the name of the hotel is not made available until after the promotion is booked

Hach concluded, "The good news is that more and more online tactics are being developed to help hotels fill rooms during low occupancy periods. However, it is imperative that hoteliers don't get caught up in the hype and keep their eye on executing high-impact activities that achieve measureable results."

About TravelClick, Inc.

TravelClick (www.TravelClick.com) is the leading provider of revenue generating solutions for hoteliers across the globe. TravelClick offers hotels world-class reservation solutions, business intelligence products and comprehensive media and marketing solutions to help hotels grow their business. With local experts around the globe, we help more than 30,000 hotel clients in over 140 countries drive profitable room reservations through better revenue management decisions, proven reservation technology and innovative marketing. Since 1999, TravelClick has helped hotels leverage the web to effectively navigate the complex global distribution landscape. TravelClick has offices in New York, Atlanta, Chicago, Barcelona, London, Dubai, Hong Kong, Houston, Melbourne, Orlando, Shanghai, Singapore and Tokyo. Follow us on www.twitter.com/TravelClick and www.facebook.com/TravelClick.