Good afternoon.Organisers asked me to speak – was is because we are the oldest, since ‘98? Was it because we are focused on travel? Or because Groupon said no? I understand they said no because of their not so impending IPO.With all the bad press some have been getting I feel a little like a staw man for the flash sale industry but it does reprsent a massive opportunity to change your business if you get it right, and a potential nightmare if you get it wrong.
Graph with price and people. Marge simpson, hippie, guy from bargain hunt.What % will varyAgree that most fit into one of these potsCruise data revealed XYZ.Criticism of flash sales is underselling product. Could get full price, Why discount etc Assumes everyone is in the first or 1st and 2nd.If that was the case, and hotels or planes were full of people paying top prices, two things would happen.Anyone? Come on a room full of entreprenuers and no one knows?!?!Price up or build more hotels and planes.
In case you’ve been living on mars and never read a newspaper – since it’s what they asked me to talk about I’ll start with defining what it is.Fixed period – creates urgency!Online – mainly email but sites like vouchercloud do it via mobile ap. Speed of response, realtimeavaiability, low cost of delivery.Revenue share – or in our case fixed fee or revenue shareHoliday company told me about how a group buying site approached them and wanted 50% discount and 50% on the remaining amount. After they’d explained how the package holiday market worked a few times they eventually agreed to give the site all of their margin and to use it as a brand building exercise – they ended up selling less than 50 packs but were seen by millions of customers wich when you compare it to the costs of TV or CPM advertising, it was still ‘free’ although they would have paid.Volume - base load or late availabilityWhat makes a compelling offer – 50% off – Off what?
700 copycat businesses, but 140 closed or sold in the last few months but more starting than closing – Gumtree last Friday..Dedicated businesses – groupon, publishers - like time out and the telegraphBig online players like google - Facebook ends Daily Deals effort just four months after launch and Yelp scaled backGroupon said in June it has never turned a profit.It’s fairly common for the mainstream media to build you up just they can know you down.Even our own share price, well covered in the media has seen it climb from $11 to over $100 and back down again $25 despite posting record results.The number of active Daily Deal sites increased 7% despite continuing churn. 53 Daily Deal sites launched in August while 29 shut down.Gumtree Daily Deals we are creating a new and unique service
$3 billion
Travelzoo traditionally operated a fixed fee media model which was seen as a risk and expensive but when some companies paid 30% revenue share on over £100,000 of bookings they realise media fees might have been a better way to go.Amazing that the way businesses are set up we often find companies say – we can;t pay a fee as we don’t have a big enough marketing budget but because a different dep[artment looks at cost of sales – revenue share even though it’s often more expensive – is a COS and therefore fine.
Don’t want to just channel shift existing customers to buy at a lower price and a higher commissionThink carefully about the deal you are putting it together= keep upsellopportunities like weekends, upgrades, wine and spa treatments, excursions.Include things with sunk costs and low cost of delivery like golf – boosts the value of the deal without increasing the costs of deliveryChannel business into your need periods – exclude weekends when you’ll annoy regularsDiscount – be aggressive – price in a 5 or a 9 and 149 an 129 and did 4 times the volume. Cost for us is your deal over someone elses and unsubscribes
Simple rule – is the audience it’s going to the audience you want to sell to?Will they spend in the hotel – don’t take their word for it!Will they come again?
Rather than focus on how brilliant we are I thought it might be more useful to show you the ones we got wrong because I think you learn more from your mistakes than your successes.Great – in terms of vouchers sold – but they couldn’t copy had to lay on extra staff with costs associated and too busy to be relaxing.Does it have wet facilities? Or just treatment rooms? Will you still make money if you have to take on contracting staff to deal with demand
Tips for restaurant deals:Include a glass of half bottle rather than full bottle.
Right business – some rules going out the window – advances – paying before customers have got there.
We sat around deciding whether to feedback and then.... The first comment to pop up...without any promting from us.....
Good afternoon.Organisers asked me to speak – was is because we are the oldest, since ‘98? Was it because we are focused on travel? Or because Groupon said no? I understand they said no because of their not so impending IPO.With all the bad press some have been getting I feel a little like a staw man for the flash sale industry but it does reprsent a massive opportunity to change your business if you get it right, and a potential nightmare if you get it wrong.
