The use of experience guarantees in tourism marketing.

December 12, 2022

With a looming recession in a post-pandemic world, you may – should? – be considering the use of experience guarantees in your tourism marketing.  Why?  Because travelers will be less willing to risk their precious dollars on an unpredictable experience.

A rare black Amami Island rabbit sitting nestled in the forest in Japan, showing how the use of experience guarantees in tourism marketing can be successful.

 

But offering a REAL guaranteed experience of any kind could be risky for you.  Sure, you can say “we guarantee you’ll have a great time” (and by the way, here’s why you should never say someone will have a “great” time).  But that’s quite different from “we guarantee XX will happen or we’ll give you a refund.”  So much of the hospitality experience is subjective that it’s hard for you to TRULY guarantee that certain things will happen.

So what CAN you money-back guarantee without exposing yourself to excessive risk?

First, embrace these two key factors:

  1. Most consumers don’t have a clue how much risk is involved to you. All they’re thinking about is the guarantee to them.  So your low-risk guarantee – which may seem like a “duh” to you – still has marketing value.
  2. The bolder the guarantee, the higher the risk. And the higher the risk, the more powerful the marketing proposition.  You need to decide your comfort level on the financial-risk-vs-marketing-power spectrum, and it’s different for every brand.

Second, remember that tourism experience guarantees serve a MARKETING purpose, not an operational purpose.  Indeed, marketing and ops departments often have polar opposite views of guarantees:  marketing would love to guarantee everything, and operations would love to guarantee nothing (because they aspire, but what if circumstances don’t allow them to deliver consistently or are completely beyond their control?).

And since these guarantees serve a marketing purpose, they must be marketing-worthy…or else what’s the point?  Such guarantees set you apart from your competitors and, if they’re cool enough, can attract hefty attention in both traditional and social media.

Gather food for thought from these examples:

No Brainer/Low Risk

  • There are so many whales in the Juneau, Alaska, area that Princess Cruises can offer a whale sighting guarantee on their paid shore excursions. You can spend 200 bucks on your ticket, knowing that if you don’t see a whale, you’ll get $100 back.  VERY attractive for travelers, VERY low-risk for Princess.
  • Also on the wildlife front, tours on the remote Amami Island in Japan offer guaranteed sightings of the island’s rare black rabbit, an animal exclusive to that area. If you don’t see a rabbit, you’ll get a 50% refund.  If you’re up for some light reading, check out this deep scientific study that assessed the benefit of these guarantees on both the tourism economy and the conservation of the rare Amami Island rabbit.  The punchline:  that guarantee is good for everyone…the tour operators, the visitors, and the rabbits.
  • A few years back, thanks to some crafty fine print, Priceline promoted a Sunshine Guarantee for its packages. The promotion covered a shockingly wide variety of destinations (really…July in Seattle?) and the bottom line is that if it rained more than the expected amount on your vacation, you get your money back.  You’re probably thinking… were they nuts?  No. They just had great lawyers that mitigated their risk:

Bolder Options with Financial Bite

  • One of the boldest and riskiest tourism marketing experience guarantees I’ve ever seen actually hails from Redpoint’s own client portfolio. Years ago, we launched a Sleep Guarantee for The Benjamin Hotel in NYC as part of its comprehensive sleep program that included a 12-pillow menu, a Sleep Concierge, and rooms specially designed for an ideal night’s sleep.  The guarantee, which offered a full refund if you don’t sleep as well or better than you do at home, added MAJOR strength to the hotel’s sleep positioning and attracted the attention of high-profile media from Good Morning America and The TODAY Show to The New York Times (multiple times… here are two), The Wall Street Journal, Time Magazine, and more.  It was a strategic component designed to attract media attention and you know what?  In the ten years we worked with them, fewer than 10 guests asked for that refund.  So let’s say that total refund cost was (generously) $10,000.  The PR value of the sleep guarantee easily exceeded $1 million in that same 10-year period.  ROI:    The hotel knew their high-end clientele wouldn’t be out to make a quick buck on this offer, so in reality it wasn’t as risky as it seemed.
  • And the Uzbekistan government also did the math. In summer 2020, they offered US $3,000 to any visitor who contracted Covid-19 while staying in the country.  This seems like a hefty financial risk to them but 1) were people even traveling internationally at that time?  And 2) It sounds mercenary but that potential $3,000 per person was definitely way LESS than the value of the marketing attention they gained.  So, even if they ended up paying out the money, it was a sound investment.
  • Aruba also realized how skittish folks would be about booking travel amidst a pandemic, so they offered a “Happily Ever After Guarantee.” Billed as “the first postponable pandemic destination booking policy,” it allowed bridal couples and honeymooners to reschedule without penalty for up to a year if Covid-19 wrecked their travel plans.  A bold move, for sure, as multiple properties had to agree to honor the policy.  But it worked, and it set them apart from other Caribbean destinations.

If you’re considering the use of experience guarantees in your tourism marketing, heed this advice:  be playful, be bold, and be strategic about your fine print.  For example:

When you evaluate carefully and do the math, such guarantees may not be so risky after all.  Consider any claimed refunds as a “marketing investment.”

And hey, while we’re doing math and looking at your P&L, see here why you can’t find love on a spreadsheet.