Should we offer flat or dynamic discounts for local negotiated rate accounts?
August 10, 2020|Hotel Marketing
If you have an LNR account, say a university or hospital in your area that is producing room nights within your market, you can start a referral partnership with them so that they will refer guests to your hotel. If the guest mentions the name of the LNR account that referred them, the guest will get a discounted rate.
Set up a referral program that is a win-win for everybody involved. Offer your referred guest a discounted rate, which will not lower your hotel's ADR.
If your LNR account cannot commit to a certain number of room nights and if they cannot sign an agreement with you for the whole year, offer them a dynamic discount instead of a flat rate discount.
Why? Let's say you offer referred guests a $99 flat rate. On dates when you have high occupancy, and you are trying to push for a higher rate, you cannot offer a room at a $99 flat rate because it will lower your ADR.
To avoid that situation, offer a dynamic discount, say 10-15% from your best available rate. When referred guests come in, you don't need to turn them down, and at the same time, you are increasing your overall ADR and revenue.
If you want to know more about hotel referral programs or if you need help in setting up a hotel marketing strategy, call us at 888-999-8086 or email us at firstname.lastname@example.org.
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