5 Segments Travel Brands Can Reach to Sell Excess Inventory
Excess inventory is a nonstop concern for everyone working in hospitality marketing. Whether it’s due to a seasonal slow down or an unforeseen dip in demand, all of those vacant hotel rooms, empty seats on the plane, or unused rental cars can add up to a major revenue hit.
Managing yield is a complex and imperfect process. To drive off-peak demand, travel marketers rely on the standard approach of running more promotions and sales; but mass discounting tactics aren’t enough.
Ninety-seven percent of digital marketers in the travel sector reported feeling more pressure to meet acquisition and revenue goals than they did last year. More of the same will only add to an already noisy marketplace.
A New Way Hospitality Marketing Can Create Demand
Gated, exclusive offers have emerged as an effective hospitality marketing strategy to create demand when inventory is high. They deliver:
- Targeted reach: A gated offer program allows you to engage a specific segment (or multiple segments) based on life stage, occupation or affiliation – students, teachers, the military.
- Worthwhile incentives: By identifying what appeals to your target group’s unique circumstances and lifestyle, you can create a high-value offer that motivates them to book during the off-season.
- Timing that works: In addition to scheduling several gated offers to run during your low season, you can also have a few more teed up and ready to launch when inventory is unexpectedly high.
As always in marketing, the real magic happens when you can match the most relevant message with your buyer group – and that’s where gated offers shine. Here are tips for how you can tailor unique, gated offers to five lucrative market segments.
Sell Excess Inventory by Targeting These 5 Market Segments
1. Be there for the military when they’re ready to travel.
The military community is 37 million members strong, with $1 trillion in buying power. Since military personnel spend a considerable amount of time away from family, traveling to spend time with loved ones holds high importance. They travel five times as often than non-military, and half of these families plan their vacations around the availability of discounted pricing for service members.
Make an offer that recognizes their travel times are unpredictable.
Give them a standing 10% discount and an additional, stackable discount, such as a flash sale of 25% off or two-for-one tickets when off-peak.
One touring company uses gated offers to provide military with additional discounts on top of other promotions; these programs outperform other flash sales by 20%.
2. Appeal to students’ sense of adventure.
Worldwide, there are over 180 million college students, with $574 billion spending power in the U.S. alone. Knowing that students are off during typically busy times – summers and holiday breaks – you need to find new ways to get their attention for off-season travel.
Make an offer that encourages them to book last-minute adventures.
Entice them with an exclusive offer when inventory is high, such as during the winter months (holidays not included.) After all, more than 60% of travelers would consider an impulse trip based on a good hotel or flight deal.
Plus, 72% of all mobile bookings made by travelers happen within a 48-hour window prior to booking. Knowing that college students have an affinity for mobile, make it easy for them to access your gated offer and conveniently book via mobile.
Free perks are also important to this group. Delta has noticed younger consumers are 60% more likely than non-millennials to buy-up to premium products, such as seats with extra legroom and first-class upgrades.
3. Entice teachers to off-season hot spots.
Like students, teachers have limited flexibility to travel outside of peak times; but they do have longer vacations than most and tend to travel to farther locations. While there are 4.8 million teachers with $1.5 billion in purchasing power, keep in mind they are a cost-conscious group who are highly motivated by discounts.
Make an offer that matches their travel windows.
Include free incentives (room or airline upgrades, free drinks) during peak season, and then extend a deeper discount to them during high inventory times to nurture long-term loyalty.
Gated offers that blend education and fun will also speak to teachers. This may include 30% off tours in locales like New Zealand or South Africa that are off-season during North American summer. These trips combine tourism with research and learning teachers can bring back to the classroom.
Another effective offer is one that provides higher ed teacher and student discounts on academically-focused trips, such as excursions to places that would appeal to language or music classes. This type of offer is especially aligned with hospitality brands currently focused on social impact efforts in the arts and education.
4. Give seniors the freedom to roam.
Rule number one in hospitality marketing: do not underestimate the interests – or potential – of seniors.
There are 109 million seniors with $3.2 trillion (!) in buying power, they spend an average of $11,077 on five vacations per year.
Seniors are vibrant, with plenty of time and flexibility to travel. Many are retired, and those over 75 spend nearly eight hours a day in leisure and sports activities. Dubbed as “cashed-up and time rich,” seniors were once wild adventurous, and many are looking to rekindle the fire through travel adventures once the kids leave home. Sixty-nine percent say they believe the best years of their life are still ahead of them.
Also important to consider is that seniors are often single. Nearly one-third of seniors become separated, divorced or widowed, and many rejoin the dating scene.
Make an offer that encourages immersive, authentic experiences.
Created gated offers for high-cost trips at off-peak times, such as 45% off $1,000 or more on a river cruise, wine tasting adventure or vacation treks.
For seniors, value often speaks louder than straight-up cost cuts, so consider off-season rates for vacations where there will be fewer children. And for singles who don’t want to travel alone, offer a two-for-one deal so they can bring a friend.
5. Show first responders you care.
From police officers and firefighters to EMTs and paramedics, there are approximately 2.3 million first responders in the U.S. with schedules tied to community need.
Make an offer that respects their schedule and expresses gratitude.
After wildfire season or hurricane season, for example, provide 20% off a getaway package and allow them to take advantage of the offer on top of all other promotions.
With all these groups, you can get even more bang for your buck if you’re able to spin up offers quickly, and gated offers allow to do just that. One travel company was able to create and launch gated offers in 75% less time than their typical flash sales. This allows you to move quickly if you want to help out a community with an exclusive offer for first responders to recover and recharge after a natural disaster.
Using Digital Verification Makes These Exclusive Offers Work
The key to a successful gated offer program is digital verification. By collecting only a few pieces of information from the traveler – e.g. name, birthdate, school or military affiliation – digital verification makes it easy to confirm eligibility through your brand’s online booking process or loyalty program.
With discount abuse reaching as high as 35% for some brands, digital verification is also a simple and cost-effective approach to protect your margins.
And it’s one step closer to meeting consumer demand for personalization: 57% of travelers feel that brands should tailor their information based on personal preferences or past behaviors. While online travel agencies prevent you from accessing customer data, digital verification establishes a direct relationship with your customers and allows you to gather and use their data to personalize promotions and nurture relationships.
Gated Offers are Effective
Leading brands like Lowe’s, Vail Resorts, CBS and others have already tapped into the power of gated offer programs to increase conversions by 3x and drive ROAS as high as 18:1. Now it’s time for hospitality marketers to see the gains.
Gated offers appeal to the travelers you’re trying to reach:
- 94% of consumers said they would take advantage of an exclusive offer.
- 91% of students are more likely to shop with a brand that has an exclusive offer.
- 95% of military members are more likely to shop at a company that offers a military discount.
Gated offers create brand affinity and advocacy:
- 60% of millennial consumers said they are “often” or “always” loyal to brands they currently purchase.
- 84% of teachers recommend retailers that offer teacher discounts.
- 91% of shoppers would share a gated offer with friends and family.
When you’re trying to capture consumer attention you need it most, gated offers deliver. You’ll get butts in seats, heads in beds, and you’ll win the hearts and business of consumers.