Fill up at half price on Tuesdays...
Unused capacity costs you money when the fixed costs still have to be paid. So a good offer on a quiet day can be a way to fill up. That occurred to me here in Las Vegas, where our hotel is packed with people in the middle of the financial crisis. And the same principle can be used in a pizzeria, a hair salon or an online shop.
The story is from my holiday in Las Vegas in March 2010. It is my 14th trip here, but normally the visits are tied to trade fairs and work. This time, my parents-in-law have invited the family to celebrate my mother-in-law’s milestone birthday. There are 11 of us on the trip, and it is very pleasant.
Las Vegas works to fill unused capacity
We are staying at Bellagio, which I think is one of the finest hotels here. In the video, I try to show a bit of the pool area. It is packed with people. How can a hotel of that calibre be so full during a financial crisis?
My explanation is that the hotels in Las Vegas are world champions at filling up. When they can see a few months ahead that occupancy will be poor, they start sending good offers to a great many people.
The hotel is already there, after all. The rent and a lot of other costs have to be paid whether guests come or not. At the same time, a half-empty Las Vegas is a worse experience for guests. So they have a strong interest in getting people in.
I mention that on this trip we are paying something like 100–150 dollars a night. I am not entirely sure of the amount. At other times, a room can cost several times as much. That is my experience of the prices on this trip in 2010, but it illustrates the point: a price that gets people to come can be better than an empty room.
Half-price pizza on Tuesdays
I also read an article about a pizzeria that had almost nothing to do on Tuesdays. They cut the price of pizzas in half that day, and the customers poured in.
According to the story, it did not just affect the quiet Tuesday. More people tried the pizzas, and some returned on other days, when they paid full price. You do not only fancy pizza on Tuesdays, after all. It could be Thursday or Friday too.
They also got publicity and goodwill. They called the offer something like "crisis Tuesday" and said they wanted to help ordinary people during the crisis. That made a discount into a story people could sympathise with and pass on.
Which day do you have room for more customers?
The principle can be used in many places where you have capacity that costs money whether it is used or not. It could be a hair salon or an airline. The question is when you have room for more customers and what could make them choose that particular time.
Perhaps you also have loads of time to pack orders in your online shop on Tuesdays. Could you offer half-price shipping or free shipping that day? It is an example you can think about further yourself, not a rule that every online shop should follow. Also read E-pusher for my experiences of selling online.
My point is to find a way to bring in some money at the times when you are already paying the fixed costs. Fill the spare capacity, and give the offer a story people like and want to share. That is the idea I am taking away from a full hotel in Las Vegas.
Best wishes, Martin
Location:Via Del Nord,Las Vegas,USA
Hej Thorborg
Jeg elsker når jeg kan starte dagen med en lille energiladning fra din side. 🙂
Mange, mange tak!
Med venlig hilsen
Benjamin Ravn