Don’t make the mistake of thinking guests won’t come back to a place they’ve recently traveled to!
Your thoughts are powerful. If you think they won’t come back, they probably won’t or maybe they will, but just not with you.
People are creatures of habit, and if a traveler finds good service and enjoys their vacation experience, they’ll want to revisit and deal with you again.
The key to getting guests to come back is to make them never want to leave.
Are your guests re-booking often?
If not, you’ve got to evaluate your service, property, and process.
If you feel like you’ve got this area of guest service under control, you may find this Harvard study eye-opening.
In the Harvard Management Update, 80% of the companies surveyed said they offer superior customer service, but only 8% of their customers agreed. Yikes!
Businesses spend a small fortune to get new customers but too often neglect to nurture their relationships with their past customers.
Although some of your vacation rental marketing might be geared toward reminding people of your rental home, most of it is focused on encouraging new prospects to rent, isn’t it?
To that, I’d have to refer to Ben Franklin’s age-old idiom that “a bird in the hand is worth two in the bush.”
Do you have a guest retention strategy?
Why is developing a well-thought-out guest retention strategy such an important part of your business, brand, and bookings?
There are numerous reasons why marketing to existing clients should not be overlooked.
We’ll start at the heart!
Did you know a five percent increase in customer retention can increase a company’s profitability by 75 percent? (Bain & Company)
We’re going to talk more about how that happens in this piece.
Here are 6 really good reasons why it’s important to invest in what I call relationship selling.
1. Customer acquisition costs more money.
The cost of customer acquisition versus customer retention could reach as high as 700%, according to a report by Frederick Reichheld of Bain.
It costs you significantly more money to acquire new customers than it does to market to the ones you have.
You’ve already spent time and money on your vacation rental advertising to get travelers to book with you.
Why not turn your marketing investments into recurring revenue through repeat rentals, helping yourself earn additional income more passively and for less money?
2. Existing customers are cheaper to service.
You’ve already spent time with them. You’ve discovered what’s important to them, what they like or don’t like, their travel requirements and needs. In a nutshell, it’s easier for you to satisfy them.
Plus, past guests will ask fewer questions and take less of your effort to close the booking. They’ve been to the property and know how to access the wifi, the home and manage their way around the property.
It also takes more of your time to enter new guests into your system. Saving time and hassle equates to more productivity.
3. You know who, and what to expect.
Each time you rent to a new guest, you may get a bit anxious before their arrival.
Will the property meet their expectations?
Will they treat your vacation home like their own?
These are the type of concerns that run through our minds with each new guest who rents our property.
Now with renting to past guests, there is a sense of predictability and trust built in place.
4. Repeat customers generally spend more.
As a general rule, new customers tend to buy in smaller amounts. If your existing customers trust you, they’re likely to buy more often and spend a little more time at the rental their second or third time.
The average repeat customer spends 67% more in the 31st-36th months of their relationship with a business than in months 0-6. [Bain & Company]
Repeat customers will often buy additional products.
This is a great opportunity to offer them additional services, attraction tickets, upgrades, or other income generators you may have put together.
Existing customers are also willing to try new products.
If you’re a management company or property investor, this is another opportunity to cross-sell and offer other properties you have in inventory.
5. Word of mouth is still the most powerful form of promotion.
If your renters become raving fans, they’ll be more likely to refer their friends and others to you. It’s like having your own sales force without the expense.
6. Existing customers are easier to sell to.
Did you know?
It’s seven times easier to retain and sell your services again to existing clients when compared to going out and getting new ones.
Here are some stats from Harry Mills: “The chances of selling to an existing client are better than one in two.
The chances of selling to a lost client are one in three.
The chances of successfully selling to a fresh prospect are one in eight.”
Are you keeping an open-line of communication with past guests?
Keep in touch! When is the last time you reached out to your previous guest?
And if you did reach out to them, was it just about a deal you’re offering and trying to get them to book?
You’ll need to work on relationship selling (there are those words again!) in order to run a profitable and recession-proof rental business.
Basically, that means- develop and build a relationship with the traveler and treat them like you would your grandmother!
It’s impossible to have a relationship with a new customer; however, it is possible and advisable to have relationships with your existing customers.
Now, that we’ve discussed the need and benefits of creating a marketing strategy designed to draw back in previous guests, let’s go over what you can do to increase the amount of guests who will dream of the day they return to your vacation home.