Flash sales - no flash in the pan but getting marketing messages right is key
By Pamela Whitby, Editor, EyeforTravel Ltd
In the middle of a "polarising market" membership based luxury flash sales site like Secret Escapes wants to be sure it gets its marketing messages spot on. Pamela Whitby finds out how
Of course, computerised recommendations based on search history are now common but it is much harder to get this right in the travel space. Just because you went to Paris last year, doesn't mean you will this year. For this reason, when Secret Escapes is in the stage of acquiring the customer, it does not focus too much on personalisation. Rather it hones in on the simple truth of its offering - that it can deliver savings of up to 70-80% on luxury hotels and holidays to the customer. So the main focus is on acquiring the right kind of customer and then once they have signed up and willingly given information, hyper-personalisation comes in.
Once they have signed up, targeting potential customers with personal messages is really quite simple, because they are mainly browsing for discretionary travel, says Valentine. "We would look, for example, at whether the customer is always browsing for weekend breaks in the UK or looking at Mediterranean holidays," he says. If a customer is searching for 'weekend breaks', however, Secret Escapes won't just hit them with offers in say 'the Cotswolds' as the aim is also to inspire and increase volumes on UK weekend breaks.
"What we absolutely don't do is say we think you know exactly what you want to do," says Valentine, "because in all frankness we'd be wrong". Instead, the aim is to send an email which highlights the simple truth of Secret Escapes but is subtly steered in direction of categories that might be interesting.
There are lots of myths around online marketing and travel marketing but for Secret Escapes' the main marketing channels are TV, email and paid search. For a membership-based site like Secret Escapes, the two main marketing questions to answer are:
- How do we acquire traffic?
- How much does it cost to acquire a new user?
According to Valentine, most media markets are quite efficient. While it may cost a bit more to acquire a customer via television, they tend to purchase more in the end. "The return on investment on our three main channels TV, Google pay-per-click (PPC) is pretty consistent," says Valentine. Of course, Secret Escapes works close with Google on PPC but it's dispassionate about the relationship. "We are quite analytical about it and consider how much traffic we get when we bid on terms and how much if we don't so we know if it was worth it," he says.
Interestingly though, the firms biggest marketing success this year has been a television led campaign. However, Valentine says Facebook's technology has also "suddenly" become fit for purpose. "Previously our ability to target on Facebook was fairly limited and felt very much like display," he explains. Today, Facebook with the pots of information it is sitting on has become very good at facilitating targeted sponsored messages that customer that might want to see.
Secret Escapes' core social strategy is to improve its core product because getting people to share is easy if they are passionate about something. "When something truly organic happens on Facebook and somebody shares a sale and then a friend signs up, those interactions are really profitable," he says. Today, the firm now has 360,000 Facebook likes and 55,000 Twitter followers, though the latter is used more by experts like travel writers.
Email is not dead
Many people will say email is dead but "we see no sign that email marketing is dying off," stresses Valentine. And interestingly the majority of the firms emails today are opened via mobile, something the EyeforTravel's recent Social Media and Mobile in Travel Distribution, 2013report backs up. It finds that email marketing is growing in popularity, supported strongly through the mobile channel.
- 38% of emails are opened on a mobile compared to 33% on a desktop.
In fact for Valentine, a permission-based email marketing list remains a hugely valuable asset. "Unless you are booking.com or Expedia and willing to bid on hugely competitive and expensive key words on Google, email consistently remains the best way to drive traffic to your site," he says. However, that is not to say that email will be the biggest channel for all time. "We are very excited by the notifications you can get for mobile apps and the majority of emails are opened on mobile," he says.
It goes without saying that mobile is another key area of focus and not surprisingly given that in 2013, 37% of consumers worldwide accessed the internet for travel purposes on the their smartphone (source: EyeforTravel Social Media and Mobile in Travel Distribution, 2013 report). That said, Secret Escapes does not allocate a significant budget specifically to mobile and today accounts for 25% of its media spend, though that could change.
"We think mobile is absolutely vital and it doesn't require massive investment to ensure that a mobile version of website is useful," says Valentine. By focusing on the essential mobile pages (the one where people sign up, and the page that drives them to purchase) and then testing, Secret Escapes has yielded big results. "When we started working on our mobile site about 18 months ago, the conversion rate was half what it was on desktop site, but now it is on a par," he says.
Right now the firm is trying to work out at what stage of the process mobile is most relevant. What they do know is that customers will visit a site three to four times before purchasing. Secret Escapes has found that people tend to use mobile in the early stage of research and will then go on to book on a desktop. "So it is important for us to make it easy for customers to add deal favourites on a mobile so they can find it quickly on their computer at work," he explains.
But it isn't about reinventing the wheel and Valentine is clear that mobile marketing is conceptually not that different from other forms of marketing. Right now though, they are learning from the successes and failures of others and plan to launch an app next year.
Moving with the market
Email may not be dead but lots of people would argue that flash sales companies have a limited shelf life. This year, however, Secret Escapes expects to do £75 million in sales. "Most of our sales are repeat sales and our pitch to hoteliers is simple," he says. In essence, the aim is to fill heavily discounted rooms that would not ordinarily be filled, but without losing out on any other more profitable retail business. This means getting people to make a booking that they otherwise would not have made. In fact, according to the company's own research, when asked, nine out of ten customers said they weren't planning the trip. He admits though, that flash sales may not work for all hotels, especially those with strict rate parity on their own site. "Then it's a straightforward media deal," he says.
On one thing Valentine is clear: you don't want to be in the middle of a polarising market. "We think hotel market is splitting and polarising. Budget hotels are getting really, very good and four and five stars are getting better and better and more and more exciting," he says. Right now the luxury flash sales site is looking to see if they can provide for the budget end of the market.
To hear more insights from Tom Valentine, managing director of luxury flash sales site, Secret Escapes and a speaker at the upcoming EyeforTravel
Online Marketing, Mobile and Social Media in Travel Europe, 2013
in Amsterdam (Oct 24-25)
International Marketing Co-ordinator
Phone: +44 (0)207 375 7163
EyeforTravel is an online travel intelligence provider to hotels, airlines, online travel agents, cruise, car hire firms and more. Established in 1997 by Tim Gunstone, right at the inception of online travel, the group offers a diverse product portfolio including industry analysis, insights, research, webinars, reports and conferences. From major hotel brands to new startups, EyeforTravel helps its 80,000 strong customer base make better decisions, build better brands, close the most lucrative deals and ultimately sell more of their product.
For more information visit www.eyefortravel.com.