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We’ve moved on from the days of cutting coupons out of newspapers, but promo codes remain an effective marketing strategy for many businesses. People love a good deal after all — research on U.S. shoppers found a whopping 92% used coupons in 2023.
As a tour operator, you can harness promo codes to drive more bookings and boost your bottom line. But promo codes can eat into your profits if you don’t use them strategically.
Below, we’ll dive into the pros and cons of promo codes and how you can use them effectively to grow your tour business.
What Are Promo Codes?
First, let’s get back to basics. Promo codes — aka promotion codes, discount codes, vouchers, or coupons — are codes customers can use when making a booking to get a discount or special offer.
For example, you might offer 10% off a tour booking when a customer enters “10OFF” at checkout.
Promo codes can entice customers to book with your tour business over a competitor, encourage them to come back as a repeat customer, or convince them to make a larger booking.
It’s a win-win too. Customers save money and you make sales you might not have otherwise.
Pros of Using Promo Codes
There are many potential benefits of using promo codes as part of your tour marketing.
Promo codes can:
- Drive more bookings: By offering discounts and incentives, you can attract customers who may not have booked a tour at full price. And promo codes on package deals, group bookings, and upsells can help you make even more sales overall.
- Gain more direct online bookings: You can offer promo codes that only work if customers book directly through your website, rather than through an online travel agency like Expedia or Viator. More direct bookings = less commission and more revenue.
- Encourage repeat bookings: Giving existing customers promo codes can help foster loyalty and repeat bookings.
- Attract customers during quiet times: You can offer promo codes that are only valid for bookings during your quiet days or times, or during your off-season, making your revenue more consistent.
- Secure bookings ahead of time — or last minute: Early bird discounts can entice customers to book weeks or months in advance. They get a better deal and you get secured income ahead of season. On the flip side, you can offer last-minute discounts to fill empty spots on tours before they run.
- Promote word-of-mouth referrals: You can give existing customers a promo code to pass on to friends and family, spreading the word about your business and expanding your potential customer base.
The benefits of promo codes for tour operators could go on…and on. But you get the idea — promo code marketing is a great way to promote your business and get more bookings.
Cons of Using Promo Codes
As with everything in life, promo codes come with a few potential downsides. Here’s what to keep in mind if you’re considering using them:
- Promo codes can eat into your profits: When a customer uses a promo code, you make less money than if they’d booked without one. The key here is making sure that promo codes are winning you customers that would not have booked at full price, and not just offering lower prices to customers you may have captured anyway.
- Frequent discounting can damage your brand image: Offering promo codes too frequently could change how potential and existing customers view your business. Customers may believe your non-discounted tour prices are inflated or your tour offerings are low quality if they’re always on offer.
- Bargain hunters may not book without a promo code: Another downside of offering promo codes too regularly? Potential customers could catch on. It’s like a shopper the week before Black Friday — they know a better deal is coming, so won’t book your tour at full price.
How to Use Promo Codes to Drive Tour Bookings
So, now you know the pros and cons of promo codes, it’s time to learn how to use them effectively to market your tour business.
Here are our top tips.
Use Promo Codes for Specific Times or Customers
You don’t need to offer 20% off everything all of the time — that’ll probably do more harm than good.
Instead, use promo codes sparingly and offer specific discounts depending on your goals.
For example, if you want more word-of-mouth referrals, you could offer existing customers a discount code they can use to refer a friend or family member.
This could be shared:
- As part of an email campaign
- In follow-up emails after tours and activities
- On a printed leaflet when you wrap a tour in person
Alternatively, if your goal is to reduce cart abandonment, you could set up automated cart abandonment emails offering a promo code to entice customers back to complete their purchase.
Set Expiry Dates or Limit Usage so Codes Aren’t Abused
In the wrong hands, promo codes can be overused, eating away at your profits. To avoid this, set expiry dates or usage limits on your promo codes.
For example, NEWYEAR30 could get customers $30 off on tours booked between January 1 to 31 — a quiet month for you. Customers then wouldn’t be able to use the code during your high season in July.
If you’re running a special deal, having a deadline also creates a sense of urgency, which could further encourage customers to make a booking.
You could also have a minimum spend that triggers a discount, enticing customers to book high-value tours, multiple tours at once, or make larger group bookings.
Top tip: With Rezgo, you can fully customize your promo codes, choosing the dates they’re valid for, how many times they can be used, and even which inventory they can be applied to. For a sleek customer experience, you can also create unique website URLs that automatically apply your discount.
Use Promo Codes to Build Your Email List
You can offer promo codes that customers can only access when they sign up for your email newsletter.
Not convinced it’ll work? A 2023 survey found 73% of online shoppers are willing to sign up for emails to get a 20% off coupon and 67% would sign up for a 10% off coupon.
Once you’ve got customers on your list, you can keep in touch with regular email marketing to drive future bookings.
Track Your Return on Investment (ROI)
Offering discounts is an investment, so you want to make sure it’s worth it for your business.
One way to track your ROI is by using unique promo codes. This allows you to track where your bookings come from.
For example, if you run a print ad in a magazine, you could offer a discount with the code SUMMER10.
You could then partner with a local business and offer discounts for their customers with the code BIKETHENBEER10 — we’re picturing a bike tour operator partnering with a brewery here.
Finally, if you’re working on social media marketing, you could give an influencer a personalized code to share with their followers.
You can then use tools like your booking software to track the performance of each promo code and find out which marketing channels have the most success.
Next Steps
Promo codes can be a great tool to help you capture more bookings, expand your customer base, and reward loyal customers.
As well as the tips above, be sure to experiment. Start small and get creative with which customer segments you offer promo codes to and where you offer them.
You can then track performance and make tweaks to your strategy to get the most out of promo codes for your business.
With a strategic use of promo codes, you’ll be boosting your bookings in no time.
Written By | Vanessa Gibbs
