21/01/2020
In the dynamic world of hospitality, attracting and retaining guests is paramount. Accommodation providers are constantly seeking innovative ways to stand out in a crowded marketplace and entice potential customers. One such mechanism that has emerged to facilitate this is the Booking Sponsored Benefit (BSB). This article delves into what BSB entails, how it functions, and the advantages it offers to both property owners and travellers.
What Exactly is a Booking Sponsored Benefit (BSB)?
At its core, a Booking Sponsored Benefit (BSB) is a promotional tool designed to make your accommodation more appealing to potential bookers. It essentially allows a platform, such as Booking.com, to subsidise a portion of the room cost on behalf of the customer. Think of it as a special offer where the booking platform contributes towards the price of a stay, making it more attractive for travellers to choose your property.
The primary objective of BSB is to incentivise bookings by reducing the perceived cost for the end-user. By covering a part of the room expense, the platform aims to draw the attention of travellers who might be price-sensitive or simply looking for the best value. This can be particularly effective in competitive markets or during off-peak seasons when driving occupancy rates is crucial.
How Does BSB Work?
The implementation of BSB typically involves a partnership between the accommodation provider and the booking platform. The platform identifies properties that could benefit from such a promotion and offers them the opportunity to participate. When a traveller searches for accommodation, properties featuring BSB might be highlighted or displayed with a special offer. The benefit is then applied to the booking, usually visible to the customer before they complete their reservation.
The specifics of how the cost is covered can vary. It might be a fixed amount off the total price, a percentage discount, or a contribution towards specific room types. The key takeaway is that the customer effectively pays less for their stay due to the sponsored benefit. This is not a direct discount offered by the property itself, but rather a collaborative effort to boost bookings.
Advantages for Accommodation Providers
For hotels, guesthouses, holiday rentals, and other property types, BSB offers several significant advantages:
1. Increased Visibility and Bookings
Properties participating in BSB often receive enhanced visibility on booking platforms. Special badges or tags can draw the eye of potential guests, differentiating them from competitors. This increased exposure can lead to a higher volume of bookings, especially for properties that might otherwise struggle to attract attention.
2. Competitive Edge
In a crowded market, offering a BSB can give your property a distinct competitive edge. It allows you to compete more effectively with other establishments by providing a tangible financial incentive to book with you. This can be particularly valuable when trying to capture market share or fill rooms during periods of lower demand.
3. Revenue Management Tool
BSB can be a strategic tool for revenue management. By selectively applying sponsored benefits during specific periods or for certain room types, property managers can influence booking patterns, optimise occupancy, and maximise revenue. It offers a flexible way to manage pricing strategies without necessarily lowering the base rate of the room.
4. Attracting New Customers
The allure of a discounted price can attract new customers who may not have previously considered your property. Once guests have a positive experience, they are more likely to return and recommend your establishment to others, fostering long-term customer loyalty.
5. Data and Insights
Participating in BSB often comes with access to valuable data and insights from the booking platform. This information can help property owners understand global travel trends, analyse guest behaviour, and refine their marketing strategies for even greater success.
Advantages for Travellers
The benefits of BSB are not one-sided. Travellers also stand to gain considerably:
1. Cost Savings
The most apparent benefit for travellers is the direct cost saving. By getting a portion of their accommodation cost covered, they can enjoy their trips at a reduced price, making travel more accessible and affordable.
2. Value for Money
BSB enhances the perceived value for money. Travellers feel they are getting more for their expenditure, leading to a more satisfying booking experience and a greater likelihood of recommending the property and the booking platform.
3. Discovery of New Properties
The promotional aspect of BSB can encourage travellers to explore and book properties they might not have otherwise considered, leading to the discovery of hidden gems and new favourite destinations.
Considerations for Property Owners
While BSB offers numerous advantages, property owners should also consider a few points:
- Understanding the Terms: It's crucial to fully understand the terms and conditions of any BSB agreement, including the duration of the promotion, the extent of the subsidy, and any specific eligibility criteria.
- Impact on Profit Margins: While the booking platform covers a portion, property owners should still assess the impact on their overall profit margins to ensure the promotion remains sustainable.
- Target Audience: Consider whether the BSB aligns with your target audience and overall brand positioning.
Case Study Example (Hypothetical)
Imagine a boutique hotel in a popular tourist destination. During the shoulder season, occupancy rates tend to dip. By participating in a BSB program, the hotel offers a "Sponsored Stay" where Booking.com contributes £20 towards every booking made through their platform. A traveller looking for a room at £150 per night sees the offer and books it for £130. The hotel still receives £130 (minus commission), but the enhanced attractiveness of the offer brings in more bookings than they would have achieved otherwise. This helps maintain a steady flow of guests and revenue, even during slower periods.
Table: BSB vs. Standard Discount
To further illustrate the concept, let's compare BSB with a standard discount offered directly by the property:
| Feature | Booking Sponsored Benefit (BSB) | Standard Property Discount |
|---|---|---|
| Cost Contribution | Platform subsidises a portion of the room cost. | Property bears the full cost of the discount. |
| Visibility Boost | Often includes special platform highlighting/badges. | Relies solely on property's own marketing efforts. |
| Perception | Seen as a special offer from the booking platform. | Directly from the property. |
| Control over Base Rate | Base rate can remain consistent; discount is external. | Base rate is directly reduced. |
| Targeting | Often targeted by the platform to specific user segments or periods. | Property has full control over targeting. |
Frequently Asked Questions (FAQs)
Q1: Does BSB affect the commission I pay to the booking platform?
Typically, the commission is calculated on the final price paid by the customer. The portion subsidised by the platform is usually not subject to commission, but it's essential to clarify this with the specific booking platform.
Q2: Can I choose which room types get the BSB?
This depends on the agreement with the booking platform. Some programs allow for flexibility in selecting room types or booking dates for the sponsored benefit.
Q3: How do I know if my property is eligible for BSB?
Eligibility is usually determined by the booking platform based on various factors, including market conditions, property performance, and strategic goals. You may receive direct communication from the platform or find information in your partner portal.
Q4: Is BSB a permanent offer?
BSB is generally a promotional tool and may be offered for a limited time or during specific periods to achieve particular marketing objectives.
Q5: How is the BSB amount determined?
The amount is determined by the booking platform, often based on market analysis, competitor pricing, and the desired impact on bookings for your property.
Conclusion
The Booking Sponsored Benefit (BSB) represents a sophisticated marketing strategy that benefits both accommodation providers and travellers. By enabling booking platforms to subsidise room costs, BSB effectively lowers the barrier to booking, enhances visibility for properties, and provides travellers with greater value. For property owners, understanding and leveraging BSB can be a powerful way to drive occupancy, revenue, and guest satisfaction in an increasingly competitive travel landscape. It's a testament to the evolving partnership between platforms and properties in the pursuit of a thriving tourism industry.
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