International travel has all but come to a complete halt across many locations worldwide, as local governments reintroduce restrictions in an effort to combat the second wave. With winter in full swing and a substantial slow-down in bookings, Hoteliers need to strategize new ways to generate revenue during this time.
NB: This is an article from Guestcentric
In the new normal of ever-changing regulations and restrictions, one thing that has not changed is the appetite for travel. Whether domestically in the short-term or internationally in the long-term, everyone is anticipating the day when they can freely travel again.
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One way that Hoteliers are capitalizing on this trend is through offering gift vouchers. In this article, we explore why this is the case and how your hotel can offer gift vouchers to generate revenue this season.
How Gift Vouchers Help Hotels Generate Revenue with No Upfront Costs
We have entered the second wave. Following the summer months, bookings and occupancy has decreased once again. In fact, our research from November 2020 reveals the average total occupancy expectation for December is just over 16%. In addition, nearly 70% of Hoteliers expect revenue declines of over 50% in 2020 compared to 2019.
Taking all of this into consideration, it makes sense that many Hoteliers are prioritizing ways to generate revenue whilst keeping costs down. While there is no quick-fix to mitigate the impact to revenue during this time, one area seeing new levels of demand is Gift Vouchers.
Guests are understandably reluctant to make a booking they might not be able to attend. But they are much more comfortable purchasing gift vouchers, which can be redeemed at a later date when the situation improves. Gift vouchers can also be used as part of your cancellation policy, which is likely under pressure.
3 Ways Hotels can Use Gift Vouchers to Generate Revenue Right Now
Gift vouchers can be used to sell night stays, package stays, any hotel services independently (such as dinners or spa treatments), or even a monetary value to spend on any of the above.
Our research shows that the top 3 vouchers sold in the last 12 months were Romantic Getaways, SPA, and Monetary Vouchers, with more than €600k sold in 2020 alone. This can give you an indication of what customers are looking for.
Below are just 4 of the many ways hotels are using gift vouchers to generate revenue right now.
1. Monetary Vouchers – Buy One, Get One Free
Demand for travel ‘experiences’ is here to stay, despite newly-imposed lockdowns and restrictions. People are still buying gifts for special occasions their loved ones can look forward to in the future, especially as we enter the festive season and look forward to other key events such as Valentines Day or Easter.
And with many countries focused on local tourism, vouchers can also be a great way to promote a destination and incentivize local markets to book. Small Portuguese Hotels, our partner hotel group comprising over 140 hotels across mainland Portugal and the islands, recognized this and took action with a ‘Buy One, Get One Free’ voucher scheme to promote the destination and bring in revenue.
2. Make the Most of Bank Holiday & Festive Season Vouchers
According to research from Google, 75% of holiday shoppers in the US and 71% in the UK who are shopping for holiday gifts, said they will shop online more this year than previously. This is a massive opportunity for hotels to be considered on special occasions or the holiday gift-giving season.
You could utilize festive season and bank holiday vouchers for dining offers, for example, afternoon tea, dinner, and bubbles, cocktails, and dessert, to tempt these gift shoppers. And also short stays, such as a 1-night stay with a bottle of bubbles in your room.
3. Give the gift of travel with an increased value for future stays
A number of hotels are offering deals in which people can buy gift vouchers now for future stays, and they will increase in value by the time they are redeemed.
One website, Buy Now, Stay Later, is encouraging travel enthusiasts to help support the hotel industry through its “hotel bonds” initiative. The industry-wide program for hotels all over the world allows guests to purchase hotel bonds now in increments of $100 (€92.16), and once the purchasers are ready to book a stay at a later date, and after the 60-day maturation period, they’ll be given $150 (€138.25) worth of value for every $100 spent.
Many hotels typically take a deposit when guests make a reservation, and those deposits help cover expenses through off-peak times of the year. But with wavering restrictions leading to mass cancellations, one hotel, Henderson & Massa in Italy, had the bright idea of encouraging guests to buy a gift card in exchange for extra value at a later date. In April 2020, Skift reported that the hotel had already sold 100 vouchers, totalling around $15,000.
While there are certainly many ways you can deploy vouchers to generate revenue during the low season, it’s important to experiment and analyze what works for you and what is resonating with your target market during this time.
Conclusion
Birthdays, Christmas, Anniversaries, expressing thanks, or lifting someone’s spirit are all-year-round reasons why people buy gifts. Gift vouchers are a win-win situation that can both instantly increase your hotel’s cash flow and give guests something to look forward to and enjoy in the future.
While many people can’t or do not want to travel right now, that doesn’t mean they lost their appetite to experience new things and discover new places. Actually, it has the opposite effect: they want it now more than ever.
