As known, your theme park company recently had struggles. The waiting lines are shorter than those at competing parks. To improve Flanagans theme park customer experience, you should consider improving the traffic flow in and out of the parks as well as the services provided by your employees As the consultant of Flanagan theme parks, you have to respond to these problems. As the head of DeniaEs consultants, I have dealt with many cases involving improvement of the profitability, and I will provide you with a well-balanced recommendation like we have done in previous DeniaEs cases. Next, I will analyse if accepting this promotion with DailyDilly is a wise business move.
Firstly, I would like to emphasize that Daily Dilly s bulk discounts will attract a lot of new people who are looking for an inexpensive deal, a chance to save money and are predisposed to a quirky experience. However most of the participants using those services are going to be low-end customers whose main priorities are for bargaining for low prices (To Muse). This will bring to Flanagans theme park no quality customers that eventually are willing to pay more for good products, services or attractions because they will spend as little as necessary at your establishment in order to redeem their deal.
Secondly, the profitability of the company would not be improved by the suggested promotion from DailyDilly. The deals appear to be a loss. Lets assume that you give 50 % cut in your price and after splitting up the prices with DailyDilly at 50% rate, the chances for you to have a margin are less because you could expect to have 25% of your normal value (Cybergate).
In addition you could get your 100% sale of your products through some regular marketing campaigns, instead of covering expenses of this deal that will make you end up with hardly any profit. However, the expenses that you will need to cover are not the only costs that you would have to pay. For example the huge influx of new a customer that result from your company deal offering, means that you will likely have to hire extra employees in order to handle the increased workload.
All of this, plus costs like training new workers and setting up interviews will have to be expenses that you need to take into consideration as well. However, you can understand that all of those costs will hardly make you end up with improved profitability. Thirdly, the huge price cuts that are required to be featured from DailyDilly severely will damage the companys image. This can be harmful for your company as people wont associate Flanagans theme park Company with high quality services anymore, which will lead to the present customers that you have to disappear (To Muse). Moreover by discounting the price your company becomes susceptible to a reduction in perceived value by the customer.
In addition, it will turn out that customer have no brand awareness so they could hurt the entire branding concept of the company. Furthermore the attention for your business will only last for few days and after that you will have to face the difficulties in terms of deal impressions because DailyDilly will train the customers to wait until the next promotion is offered before making any other purchases (To Muse). Last but not at least, what could prevent you from damaging your companys image will be creating strong customer-based relationships, which will not happen with the DailyDilly promotion.
Lastly, the aim of every company is to establish a long term relationship with its customers and turn them into loyal customers in the future, so they could provide them with ongoing business. Establishing a long-term relationship after accepting this promotion will be not possible and the reason for that is when customers get something at a much lower price, they will become less inclined to pay full price for that same product or service in the future (To Muse).
Additionally, according to marketing experts DailyDilly would have a low conversion rate for repeat customers and the company may not see again the customers and the concept about establishing a long term relationship with your customers will not be possible anymore. In conclusion, my advice to you is not to accept the suggested promotion with DailyDilly. I believe that this is the best option because this way you will avoid customers with main priorities for bargaining for low prices and not willing to pay more for it in the future.
Additionally you will save unnecessary costs that will make you end with any profit. Moreover your company will keep the companys image of a theme park company with high quality services and attractions. Last but not at least, you could establish a long term relationships with your customers instead of making them less inclined to pay full price for that same product or service in the future.
I recommend that in order to improve your profitability, you should establish a long-term relationship with your customers, next to that you should improve the services provided by your employees because the customers are mainly turned off because of your services. Additionally you should improve the traffic flow into and out of the parks which is the reason for the crowded conditions. If you follow these stages, you will successfully improve the profitability within your corporation and hold the key element in adding future value to your company.
Eklund,Kevin. Top 10 Reasons Businesses Shouldnt Use Daily Deal Sites Like Groupon To Advertise Locally . To Muse. Web. 19 November 2012 Travis.
Helping business drive traffic to their site. Cybergate. Web. 19 June 2011. 19 November 2012.