Case Study: Using Deal Sites To Fill Rooms At Off-Peak Times

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Companies in the travel and tourism industry have been quick to jump on the daily deals bandwagon in an effort to boost occupancy rates in a sluggish economy. As the revenue manager at Charlestowne Hotels, a hospitality management company that works with 26 hotels across the U.S., Jared Hassard frequently runs special offers on sites like LivingSocial, Jetsetter, Groupon, and SniqueAway as a way to fill rooms during slow periods. Hassard says he’s contacted by deal companies all the time, and that he chooses which businesses to work with based on how much they’re willing to negotiate on room discounts and commission splits.

Tell me about your marketing at Charlestowne Hotels. What do you do from a broad perspective?
We market the hotels in many different ways. We do it through online banners and Google Ads; there’s monthly e-blasts; there’s travel ads on various travel websites; we try to pick up travel writers all the time to get stories picked up in the newspapers. Pretty much wherever there’s a channel, we make sure that our hotels are listed on it.

What drew you to daily deal sites initially?
Working with all the different flash sales, the draw to it is that it’s immediate. There’s an immediate impact. You’re getting your name out there to all their lists, and hopefully they’re going to come back and book with you directly. We try and choose strategic times as to when to use them. It is normally a 90-day booking window once the sale goes out. They’ll fill an immediate need, so [we use it] during our slower times. Or, if we see that we are having a pacing issue at one particular hotel then we will look into doing a sale, whether it be with SniqueAway, Groupon, Jetsetter, or LivingSocial. There’s a bunch more out there, too. Jetsetter and SniqueAway are some of our favorites. Then we have Groupon and LivingSocial. There are just so many out there. There’s one called Perfect Escapes; HauteLook; Half Off Depot; Trubates. There is one called Rue La La that’s been after us. Some of these we haven’t worked with, but they’re always [reaching] out to us to see if we’ll do something.

Because there are so many of these sites out there now, how do you decide which are worth working with?
We are approached by them all the time. How we decide is really just who gives us the best deal, as to who will give us the best margin. Some sites require you to give 50 percent off, and some require 30 percent to 40 percent off. It’s all about negotiating the commission at the end that you split with the flash sale [company]. It also just depends on timing and if they have something open on their calendar dates.

How far in advanced are these things usually planned out?
Anywhere from a week to six months. I’m already starting to look into doing some for the summer months when I know some of the hotels are a little slower. I’m trying to get in on the better deals with the better [sites] and schedule those calendar dates right now. We recently just dropped a Jetsetter for Restoration On King, and this has been in the works for about two weeks. They happened to have a calendar date open, so we jumped in on that because we knew we needed help in February.

Of the deal companies you’ve worked with so far, do any stand out as being the best in your eyes?
My favorites are Jetsetter and SniqueAway because they give the best deals both for the consumer and for the hotel. Groupon, LivingSocial, and some of those [sites] sometimes will run smaller businesses out of business because their margins are so large. They usually require a 50 percent off deal, and then they want to split the revenue 50 percent, so that doesn’t leave much for the business.

Does that mean companies like Jetsetter and SniqueAway allow more negotiation, in terms of the margins and the commissions?
Exactly. It’s not as much off and not as much of a split on the back end.

How do deal sites compare to ads in traditional travel publications, in terms of ROI?
If you look at return on investment, that’s usually a percentage. So obviously an ad or some of these other marketing efforts, not including flash sales, usually those probably [deliver a] better return because it is not costing you as much. But, you’re not getting as much of an impact immediately. So, it just depends. [We haven’t] dropped off any of our other efforts. I think these sales just encourage people to travel even more.

Looking forward, where do you see hotel marketing going in the future?
I think we’re going to keep up with all our efforts. With flash sales, it’s all going to be determined by the economy coming back and how we’re pacing into the future. I think there is always going to be a need for them, I just don’t know how much.

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This interview has been edited for length and clarity.

Stephanie Miles is a journalist who covers personal finance, technology, and real estate. As Street Fight’s senior editor, she is particularly interested in how local merchants and national brands are utilizing hyperlocal technology to reach consumers. She has written for FHM, the Daily News, Working World, Gawker, Cityfile, and Recessionwire.