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January 2015

Deals Expand the First-Time Audience

Discount subscription programs such as Groupon broaden the newbie market.

Written by Alex Goerdt and Stephanie Grutz, Sundown Mountain Resort | 0 comment

At Sundown Mountain Resort in Dubuque, Iowa, we are constantly working on initiatives that introduce new skiers and snowboarders to the sport, such as “Bring a Friend” and others, that attract customers with introductory pricing. Many of our typical customers are first-timers either introduced by friends and/or family members. But Groupon and similar programs have proved they hit a broader audience that otherwise has a less direct connection with our resort, and with winter sports in general.

We offer a Beginner Special that includes a Beginner Area lift ticket, rental and a 1.5 hour group lesson for $60 on weekends, $35 during the week and after 4 p.m. on weekends. Beginners can up­grade after 1 p.m., after completing the lesson, to a full-day all-area lift ticket.

Over the last few years, we have utilized third-party discount providers such as Groupon and hometown versions such as “Here’s the Deal,” which is offered through local media. These have worked great to get our word out to customers who may not have been actively looking for snowsport activities, but have subscribed to receive daily discounts. It was cool to see new people coming to the sport just looking for a different activity/adventure than their regular weekend routine.

We experimented with a number of different providers. All have a very similar redemption process although each was unique in their own way, some a little easier to redeem than others. Groupon drew the most customers and broadened our market area.

What I Learned from a Sub Sandwich!
One of my first experiences with daily deal sites like Groupon came from my father, who purchased a $10 coupon for $5 at a local sub shop. He visited the sub shop to redeem his lunch and chatted with the employee about the program. As a business owner himself, he saw the benefits of a program like this to get new customers in the door, and wanted to hear first-hand about their experience.

The employee was unkempt and unfriendly. As he threw a sloppy sub together, he rolled his eyes and told my dad that the Groupon promotion was hurting the business with all these cheap subs going out the door. My father ­decided that was the last time he would patronize that business—the total opposite of what the business was trying to promote.

Any business has only one first opportunity to give new customers a good or bad experience. We set up our program to increase the odds of a great experience. Once a guest passed the ticket counter, no employee could differentiate a Groupon beginner from a regular paying beginner, ensuring customer service was the same for everyone.

Our Concerns with Daily Deals
When we started this program, we were concerned that a steep 50 percent discount would cannibalize our walk-in traffic. However, that wasn’t the case. Third-party deal sites reach customers that may not have been on our radar, and most were outside our typical customer radius. Our data show that we had very similar walk-in numbers year to year.

We were also concerned that people would purchase the Beginner Special and try to upgrade immediately at our ticket window. To counter that, we require everyone to complete a lesson before they upgrade, which they could only do after 1 p.m. Our percentage of upgrades was in the high-20-percent range whether they were a traditional walk-in or purchased through Groupon, so we are confident that this procedure (and the program itself) was successful. Speaking of success, our Beginner Special has grown from 800 skiers/riders three years ago to more than 2,500 this past season, all of that new business!

Adding an influx of beginners to our resort has created its own challenges. More customers redeeming coupons impacts lines at the ticket windows. More beginners in the rental department need help sizing boots and learning to carry their equipment to the slopes. It also means more beginners taking lessons, learning how to navigate the beginner area, and how to successfully navigate the chairlift. That places greater burdens on our staff. Our ticket window staff might become frustrated with the redemption process, our rental staff might become annoyed with fitting boots, our ski school could become frustrated with so many beginner lessons, and lift operators could become fatigued by continuously helping customers on and off the lifts.

Therefore, the staffing level was important. We knew that when the weekend forecast was favorable, both general customers and discount coupon buyers would flock in. So we added extra staff and stationed a greeter at the door to help the first-timers navigate the arrival and rental experience.

We have a chance every day to make someone’s day! We frequently remind our staff about the impact they have on every customer. Our frontline employees work tirelessly each day to provide the best customer experience they can. Because no customer wants a “sloppy sub,” no matter how great the deal is.