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Deals and discounts have been part of companies’ efforts to drive business since business has existed. Travel is no exception. With the recession came the advent of more frugal consumers and, in response, more aggressive use of deals. The increasing use of digital technologies by travel-researching consumers creates a unique opportunity to gauge the impact and effectiveness of promotions.
Compete evaluated several airline promotional efforts in December 2011 with two primary criteria: number of unique visitors (UVs) that reached a promotions page on a given brand site and the booking rate of those consumers relative to the booking rate of the sites’ visitors in general. UV volumes measure quantity of people, and leverage Compete’s patented normalization process (which avoids false positives from just counting clicks or using cookies). Relative booking rates are one measure of quality.
December Airline Promotion Volumes
Southwest, American, Delta and JetBlue controlled the top 10 airline promotion slots in December based on volume. Southwest led the way with its “Rapid Rewards” promotion with 1.8M UVs. In fact, Southwest had five of the top six airline promotions that month (not shown). American’s best was the “Journey Starts Here” sweepstake at #5 with 213k UVs. Delta’s best was “Best Delta Fare Ever” at #7 (99k UVs) and JetBlue’s best was the First Bag Free promotion at #8 with 46k UVs.
December Airline Promotion Conversion
Traffic volume is one measure of success, but the ultimate goal of driving traffic to a site is selling tickets. To evaluate the success of the four above promotions, Compete compared the booking rate of those viewing the promotions with the overall booking rate for the same site overall. The result is an index, where greater than 1.0 means that promotion-viewing consumers booked at a higher rate than typical site visitors.
The results show the Delta and Southwest promotions had the best relative booking results. Delta consumers viewing the Delta “Best Fare” promotion booked at 1.52X the rate of the typical Delta.com visitor. Southwest was close at 1.49X. Viewers of the included American and JetBlue promotions booked less frequently than typical visitors to those sites.
This simple analysis suggests that Southwest’s Rapid Rewards promotion was the one to beat in December: its UV volume leads the others’ by a large margin and its booking index is near best in the set. But there is more to the story that needs to be investigated before results can be called conclusive.
To make that call, Compete recommends the following incremental analyses:
- To what extent did promotions create incremental consumers? Were they supposed to, or were they more focused on closing existing visitors??
- Validate by identifying how frequently promotions viewers visited the site in the past (i.e., before viewing the promotion).
- Include a deeper dive to look at the extent to which promotions viewers booked in the past
- Does a higher booking index mean more revenue??
- Compare the average fare of promotion-viewing bookers with other bookers.
- Were the promotions relatively cost-effective?
- Compare the unit cost of driving traffic via promotions across brands and vs. other traffic sources
- Include the results from the first analysis to identify when an airline is advertising twice to the same customer (once through traditional means and once through promotions)
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