While last minute specials can entice a potential customer to make a purchase, using incentives should be chosen carefully.  Besides eroding profitability, there are messages associated with such discounts.

Impact of Frequent Reduced Pricing

In essence, you are telling the customer that your vacation home offerings are over-priced.  Instead of focusing on the convenience, experience, and relationship aspects of obtaining repeat customers, you are telling them that if they are paying full price, then they are getting ripped off.

Pricing is relative and is based on perceived value, scarce resources, as well as customer desire.  If a customer is satisfied with an experience, they are likely to give you repeat business, or, they are likely to recommend the property or location to their friends.  Referral marketing is one of the most effective ways to develop prospects.

Discounts and Promotions Can Be Copied by Your Competitors

Whether you are promoting a fixed dollar amount or a percentage or other incentive, you run the risk of having your promotion copied by those in surrounding areas and vacation markets.  Your promotion then loses its exclusive appeal and the new price becomes the standard.

Message to Customers

By offering an incentive, you are appealing to your most price sensitive customers who are shopping for a bargain.  Many shoppers who are looking to rent a vacation home fall into higher income demographics.  These individuals are less likely to be concerned about price and more likely to be motivated by the experience.  Treating these individuals well, correcting any problems, and establishing rewards or exclusive offers can make these customers feel welcomed.  Establishing a sense of urgency to book to obtain exclusivity can also help drive early bookings.

Last Minute Discounts

While discounting can help fill vacancy and create revenue, this should be used with caution.  In essence, by discounting at the last minute, shoppers are being trained to wait for a deal and to be flexible with dates.  Long-term, this could drive down your revenue.   Driving bookings early is the key to increasing profitability.

Correcting Pricing Perceptions

When communicating with your current clients, the messaging should be focused on the value that they will receive by booking.  Vacations are associated with childhood memories, family traditions, recreation, relaxation and convenience.  Focusing on these aspects can help redirect the messaging from price-based to value-based messaging.  For price conscious customers, offering them a selection of properties that better meet their budget might service as an alternative to the discounting. 


Solid relationships are hard to copy.  Building rapport with your customers will provide you with long-term customer loyalty.

For more information on Customer Loyalty, please contact Visual Data Systems.  

Phone: (410) 964-8665 
Email: marketing@vdsys.com
Web: www.vdsys.com