Everyone is well-acquainted with the concept of gift cards, a physical or digital card that allows its owner to spend a set amount of money on goods and services. Just as good as money, the owner receives as much as what was put in.
People are supposed to stay in their homes as much as possible during the coronavirus pandemic. Since they are not going out and spending money the way they used to, many businesses, mostly restaurants, stores and even hotels, have pushed the idea to consumers they can/should buy gift cards to provide money to struggling businesses now and then cash in on them later.
The idea makes sense. Find a business you love and then support it through this crisis until it’s safe again to return to normal activities, but I don’t know if that’s necessarily enough incentive to get enough people to do it.
Something I read this week, though, was intriguing. Forbes reported there is a campaign called “Buy Now, Stay Later” that encourages people to buy a gift card for a hotel that acts like a bond. Hotels that participate in this campaign will take a person’s money now, but the value of what that person spent grows over 60 days. A person looking to stay at a hotel in the future could spend $100 now through this campaign and in two months have a $150 credit waiting for them. Every $100 earns an extra $50.
That is a great way to get the attention of consumers. It merges two concepts they’re already familiar with: gift cards and savings bonds, giving them a return on their investment after a much shorter period of time than 10 years. It also gives them something to look forward to when all of this is over, whenever that will be.
It is such a great idea that hoteliers should consider offering this after the pandemic. It doesn’t necessarily have to be a 50% return each time, especially if hoteliers decide to do this on their own, outside of the current campaign. Absolutely make sure there’s enough of a return to give real value to guests, though.
Outside of this pandemic, offering a hotel “bond” seems like a promising way to boost transient leisure business during slower periods of time. Hoteliers could create their own campaigns asking people to buy the bond with a cash-in during a specific month, knowing they can make up some of the loss through food and beverage or other services and amenities.
The effect on revenue might end up being no different than discounted rates or other special packages but taking a novel approach to attracting business might catch on with potential guests. It’s an idea worth exploring to at least to see how people respond.
What do you think of the hotel bond idea? Do you think hoteliers will see success with it during and after the pandemic? Let me know in the comments below, or reach out to me at bwroten@hotelnewsnow.com or @HNN_Bryan.
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