Now that everyone seems to be talking about Groupon, let’s switch gears and talk about the other hottest category online right now: private sales sites. Many of you are familiar with these sites but I thought it would be a good time for a post about it. Private sales sites are invitation-only communities that many luxury brands are using to promote limited time sales. The lines are getting blurred between the pure travel sites and others that have adopted a travel category within their offerings. If you like five-star treatment and want a great deal make sure you sign up for these, or ask me to refer you.
Here’s a roundup of the private sales sites you should be familiar with in the travel category:
Jetsetter: Launched in September 2009 by parent Gilt Groupe, Jetsetter now claims 1 million members. Last week via a Tnooz post they announced the addition of hotel deals with longer term booking windows allowing them to complement their existing content by appealing to the traveler that knows where they want to go.
Sniqueaway: TripAdvisor’s private sale site launched in September 2010.
Tablet Hotels: Since 2000, Tablet has built a reputation for selling boutique and luxury hotel experiences. In January 2010, Tablet announced a private sale section in the site.
Vacationist: Vacationist is a partnership between LuxuryLink and Travel + Leisure magazine. The private sale site launched in April 2010.
Voyage Privé: A well established player in Europe with 6 million members, Voyage Privé launched in the US in February 2010. It has established relationships with 1,500 suppliers globally and has offices in France, Spain, Italy and the UK.
Luxury merchandise with some travel content:
Rue La La: Currently has 3 million members. In August 2010 they announced a partnership with Virtuoso, a network of traditional agencies that are focused on luxury travel.
HauteLook: Acquired BonVoyou in September 2010 to create HauteLook Getaways. The site had 3 million members in the US and Canada as of September.
Ideeli: Online shopping site that claims 3 million members.
Interesting new entrants from the wine category:
Even though I focus a lot on travel sites, it is interesting to see some newcomers from the wine industry. They appeal to a very similar audience.
Lot 18: Launched in November 2010 by the founder of online wine retailer Snooth.com.
Invino: Private sale site for wine enthusiasts. Launched in November 2010 by Winery Insider.
Of course we all know about the huge success of Gilt Groupe, but here are some others you might want to look out for: 365 Hangers, Beyond the Rack, Billion Dollar Babes, Ebay’s Fashion Vault, Overstock’s Eziba, One King’s Lane, and Swirl by Daily Candy.
What is the appeal? Why are they successful?
- Hotels and/or luxury retailers can fill or move unsold inventory and still attract a high quality customer that is likely to buy again.
- They are closed sites so only a limited number of people are aware of the hotel participating in the deal. It does not dilute their brand or the brand value of the property.
- The site normally is positioned as luxury so strengthens the hotel’s luxury brand perception.
- Consumers, even discerning shoppers that have money to spend, are deal-centric. In the heat of the recession all travel sellers needed to sell at a discount, savvy shoppers got used to this and now realize they don’t need to pay full price for anything. They are quick to find and use these sites.
- The membership are influencers and will talk about the brand or hotel experience. This is a great way to launch and create buzz for a new property or product within a high quality audience.
- Private sales rely on member referrals to acquire customers, ensuring a better quality audience. Members are often incentivized by a $25 credit if their friends sign up and purchase.
- These sites are banking on the opportunistic and spontaneous nature of consumers and through a great deal and clever imagery can encourage them to buy things they weren’t planning on.
What are the opportunities for private sale sites?
This online category has still got a long way to go and for the sites themselves there are huge opportunities to better harness the power of social and sharing to acquire members, drive engagement and motivate members to have a deeper connection with the brand and purchase more.
A couple of thoughts if you are in this business:
- This is a tech savvy crowd who are heavy users of mobile and depend on it while they are traveling. Mobile will be huge for purchasing, notifications and search while on the road. There is an opportunity to sell more incremental purchases to travelers that have already purchased a hotel – you know when they are traveling, where they are staying and the destination they will want to explore.
- Personalization of the daily email and its content. Savvy consumers will react when something is personalized and the content is something they are passionate about. Sites normally need a large enough audience to split the base and do this, but it is a huge opportunity to provide relevant content that will spur purchases.
- Deeper social strategies to drive engagement and further enhance communities. As already discussed in a previous post, social is the way forward.
- Greater audience engagement with UGC and rich media to increase purchasing. People believe what other people have to say about the hotel, especially if it is coming from their friends. They also react to places/things their friends have already bought, or if it is a hotel their friends have stayed at. We all know that video is huge another big way to motivate shoppers to buy.
- Increased revenue opportunity for other non-competing high end brands to sell media space.
- Offline engagement such as member’s events, launches & soft openings. Anything that is exclusive will make these shoppers more loyal and encourage them to tell their friends.
- Diversify and sell complimentary products. Those that feature luxury items are leaning into selling travel, realizing its potential and interests of their members. The idea is to create a one stop shop that will surprise and delight their customers.
- Perks and special treatment during the travel experience (i.e: room gifts, restaurant discounts, check in surprise gift). There are many opportunities to do this and create more value for your brand.
If you use these sites or are in this industry tell me about your experience by posting a comment below..!