For airports already generating significant revenues from roll up / pay on foot customers it's often difficult to build a business case to justify investment into a parking reservation system.
This article discusses some of the common questions that occur to parking revenue managers; and hopefully highlights some new opportunities around bookable parking that you may not have considered.
Business case point 1 - Why should I offer a discount to customers who book a space? They just turn up and pay full price right now. Surely I'll lose money.
The answer to this question largely depends on your current position in the market and your current occupancy levels. If you're the only show in town / have no competition and never come close to being fully occupied, you’re right - bookable parking might not be right for you.
If you do have off-site competition, you should definitely take a look at offering bookable spaces, especially if your competitors already are. This works on two fronts.
- If your car park occupancy levels are low: - Increased distribution will help to increase occupancy levels. A bookable parking system can provide the tools you need to sell through airline and travel agency partners. The more customer touch points you create and the sooner you get in front of the customer during the travel purchasing process, the greater your chance of a sale at the expense of your competition.
- If your car park fills up during peak times:- Through yield management and forward visibility of occupancy levels you can optimise your pricing, increasing revenue through smarter pricing whilst not necessarily taking on more bookings.
Business case point 2 - The true value of customer data and the 'booking horizon'.
There is a great deal of additional value in having forward visibility of customers before they arrive at the airport. By using this 'booking horizon', a reservation system can give you the tools to create additional revenue streams outside of parking.
Consider the following scenario:
A customer books a parking space (£50). During the booking process the customer also purchases a product upgrade to valet parking and an exec lounge (total additional value £25)
An automated email is sent to the customer offering a 'lowest price guarantee' for car hire at the destination the customer is flying to. The customer clicks the link and makes the purchase. Total additional commission value £25.
An automated email is sent to the customer offering travel insurance at a discounted rate of £9
As you can see from the above scenario, the use of a booking system, combined with some intelligent marketing has more than doubled the revenue opportunity presented by the customer.
As you begin to analyse your customer database, identification of customer travel patterns opens up the opportunity to promote flights, hotels and holidays at key decision points for individual customers.
How Inventive can help
Inventive's Altitude Reservation System provides the most advanced solution in the market for managing airport parking and service sales. Our solution processes 1.2 million airport service transactions a year and is currently used by the UK's most innovative airports. Our team have extensive commercial and technology experience and our partnership approach means that we act as much more than a software solution provider.
About Inventive IT
Inventive IT specialise in Travel Industry e-commerce, yield management and pre booking solutions. Our team have delivered solutions for clients including Peel Airports Group, Thomas Cook and Laterooms.com, with online pre booking revenues exceeding 1 million pounds per day. Their highly scalable airport product pre booking system 'Altitude' can help your business realise the following benefits.
- Reduced commission to third party distributors through better control of allocations and pricing.
- Increased revenues through improved yielding and revenue management capabilities.
- Improved up sell and ancillary product sales through increased on-line conversion and product bundling.
- Improved distribution opportunities through the use of multi-brand white label websites and XML web services.
For more information please get in touch.
Inventive IT LTD
No. 1 Portland Street
T: +44 (0)845 867 7641