Marketing Review - Spring 2008 - (Page 37)

TABLE 4: Demand Drivers: Propensity to Travel; Price Sensitivity; Target Areas Strategies & Opportunities for Enhancing Revenue for 2008 Tax Rebate Check Recipients Potential 2008 Summer, Fall & Winter Vacation Travelers Receiving Tax Rebate Checks Description and Propensity to Travel How they will proba- Target Areas to bly spend Enhance the tax rebate Revenues Price Sensitivity (Price Elasticity of Demand for 2008 Travel) Targeted Sales & Revenue Management Strategies When Rebate Checks are Mailed Since trip already booked, contact with marketing materials or emails with add-on nights and ancillary activities and services. Little discounting needed. The “Going Anyway” Group This group has already decided to travel with or without the tax rebates; they have already booked trips or are definitely planning to book trips; they are “going anyway.” This group has thought about booking trips, perhaps researched trips and considered destinations, but are “on-thebubble” as to deciding where and length of stay; they are lookers, but not yet bookers. This group will splurge, will probably spend a large portion of the tax rebate on retail or travel, and a smaller portion paying off debt or savings. Since this group is “going anyway” revenue opportunities are in intercept marketing by up-selling, additional room nights, and selling ancillary services after they have booked and have received the tax rebate. Since this group has looked but not booked, revenue could be generated from family package deals, weekend getaways and ancillary services and activities priced within rebate amount range. Not very price sensitive. They are “going anyway” and discounts are not as important as value of ancillary add-on activities and services enhancing the vacation experience. Moderately price sensitive to both hotel rates, destination activities, and ancillary services. Seeks but does not require discounts, value conscience purchases. .The “On the Bubble” Group This group may spend a larger portion on retail and travel, and smaller portion of rebate to pay down some debt or add to savings. Rebate checks are catalyst to get them off the bubble and purchase travel. Convert lookers into bookers by strong marketing campaigns with moderate discounting. Booking pace watched for closing discount rates early if strong demand. Both family packages and weekend getaway packages will be popular. Impulse buyers require few discounts, deal hunters require real or perceived discounts. The “Would if I This group has not This group has yet considered a both impulse buyCould” Group trip, but “would if they could” afford a trip. ers, and deal hunters. Has potential to spend a large amount on travel depending on exposure to marketing campaigns. This group will spend nearly all the rebate paying down debt or adding to savings, necessities, or buying retail, but little travel. This group has not looked or booked, popular buys will be family packages with ancillary sales. More price sensitive. Resistant to travel unless price reflects real or perceived discounts and deals. The “Staying Home” Group This group has not and will not be considering a trip; they are “staying home” This group has no motivation to travel. No reaction to prices. Discounts and deals will not motivate to travel. Should not be targeted with marketing resources. • Consider limiting booking windows on lower advanced leisure rates, • Consider limits on the number of discount rates offered, and • Consider pricing discounted rates closer to rack rates (lowering percents of current discounts offered). SPRING 2008 • HSMAI MARKETING REVIEW 2. Consider limiting group sales in anticipation of stronger transient demand after checks are received. If booking pace patterns indicate strong demand by consumers from the first wave of rebate checks distributed, and strong demand from pre-rebate spenders, sales and revenue managers should consider limits on future groups sales. This strategy is aimed at minimizing displaced revenue generated by anticipated stronger transient demand generated by consumers spending tax rebates on travel. Potential revenue will 37

Table of Contents Feed for the Digital Edition of Marketing Review - Spring 2008

HSMAI Marketing Review - Spring 2008 Contents COLUMN: The Online Marketer COLUMN: Success Stories COLUMN: Guest Column Ten Trends Now Shaping the Future of Hospitality Turning the 2008 Consumer Tax Rebates into Hospitality and Travel Sales 25 Extraordinary Minds in Hospitality and Travel Sales and Marketing The Lure of Lore: Connecting with Customers Through a Unique Brand Story A Careful Balancing Act A Meaningful Relationship: How Technology Affects the Connection Between Hospitality Marketers and Meeting Planners SPECIAL SECTION: The 2007 HSMAI Adrian Awards Building Five Star Imagery

Marketing Review - Spring 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.