Read more! See the AllBusiness Guide for working with daily deal sites for the latest expert advice and news.
At 8 am on a Saturday in February, the phone began to sound in a small office in Miami on a concrete Pier that extends into the blue waters of Biscayne Bay. Moments later a second line began to sound - and with that, the phone system in South Beach Yacht was officially overwhelmed. The next call came into voicemail and the other after a busy signal.
Undeterred, left messages for callers or back tested over and over again, eager to plunk for $199 for a rent of boat that normally would have a cost of $400. It seemed almost too good to be true, and potential tenants had frequently asked questions - many, many questions.
At the moment that the phones were silent Sunday night, some 800 calls had poured into which represents an increase of 2,000% on phone company normal weekend traffic.
Ironically, the massive increase in business came without any additional cost initial advertising. "We spend thousands of dollars in Google AdWords, and always appear at the top when people seek in Miami boat rentals," said Ernie Sauer, a former New Yorker that he "retired" Florida and South Beach Yacht launched in 2009.
"But a lot of people do not go to the Internet and thought it was time to try something more".
More turned out to be LivingSocial, the site of coupon that has been giving Mayor a run for its money in the growing number of days space marketing. Mayor would have been his first choice, said Sauer, but "I don't want to talk with us for months and months and months".
"One of the problems is that you cannot get to a real person on the phone [on Mayor]," said Sauer. "Go to your Web site, the shape of his new contract and could eventually return to you if you are interested in".
Frustrated by the lack of response from Mayor, Sauer asked his manager, Greg Jackson, to look for alternatives. Jackson went on to have an acquaintance who worked for LivingSocial in Washington, D.C., and Sauer was finally able to speak with a real person on her forehead.
"LivingSocial only came on the scene in Miami," explained Jackson, and the service was eager to the line of new offerings. Rent boats South Beach was signed in the second quarter of 2010, but then "LivingSocial we keep." "It took almost a year to reach this fact".
The problem? According to Sauer, in mid-2010 the daily deal sites still were working mainly with restaurants, where the business model is quite simple. "Who could not obtain the head around our offering", said representatives of sales of LivingSocial.
"Anyone can go into a restaurant and eat the food," Sauer, said. "But in our case, you have to have navigation experience." "Our insurance requires a lot of questions to ensure that the tenants are qualified".
LivingSocial seemed reluctant to alienate customers that have excited with an agreement, only to find that they were not eligible to participate. And for practical reasons, the offer would have to include many other fine print that can be daunting, including surcharges for fuel, the availability of ship and time restrictions.
If boat hire presented a new challenge for LivingSocial, the idea of a coupon was just as disappointing for Sauer. "Terrifying' is the best word I can think of," he said. "We have seen as a way to get our name out there, because the business is where we really do our money."
"But we don't know how much of a loss leader would be," said Sauer. "And we are talking about some pretty big numbers." He drank lots of coffee and they ran the numbers over and over again. What happens if we collect it, what happens if we offer you? We tried every scenario you can think, and sometimes worked. "
Initially, Sauer said he and Jackson moved into offering a $50 flat discount good towards any rent. But with some packages of up to $2,000, "a $50 coupon would be meaningless," he said.
Another option was deeply offering prices at one all inclusive package, including soft drinks and a professional captain. You can have the attraction of attracting more inexperienced boaters, but could also block the losses of the company, as all update options were already included in the price.
"We ended up losing about $30 or $40 for each transaction if we made a package all inclusive tour and could not see any way in,", said Sauer.
In the end, Sauer and Jackson was established in an agreement which was quite lucrative for both parties to accept and easy to explain: four hours in a small boat with no captain of $199.
The agreement came in February, almost a year after the initial contact of the company with LivingSocial - and that's when the real work begins.
800 Calls that flooded in that first weekend, little more than 200 customers after the purchase transaction. For the next two weeks, rent boats South Beach was flooded with the callers to schedule his four-hour slot, and about 30 percent of certificates were redeemed in the first 30 days.
Sauer, said the flood initial has tapered now, and the programming is becoming easier. Despite all the efforts to explain in detail the complexities of the operation, "a handful" of customers has requested their money after discovering that they could not choose any ship in the fleet or that do not have a professional captain at the wheel.
"" But the gripers are in a distinct minority, according to Sauer: "ninety-nine percent say," Oh, that was great, we are to do it again "."
It's a feeling same Sauer shares about the process, despite their ups and downs. The agreement of coupon "put us on the map in some respects," said. Gross revenue of the company are 50 per cent compared with six months ago, and although some of them is because the economic upturn to general, there is little doubt that the stamps played an important role.
Better still, Sauer said, about one-third of the customers coupons Redeemer so far have been updated to larger vessels or hire more time, so that the agreement has not been the great leader of loss Sauer initially feared might be.
Now that it has been through it once, Sauer is once again: two weeks after his successful agreement on LivingSocial, rent boats South Beach received a call from Mayor. "We suddenly are on the list because we have delivered" smiled Sauer.
Sauer, on the basis of its experience of side, says the new deal came together in just two weeks, and he thinks it will sell bonds from 400 to 500, with the Mayor's largest customer base.
And this time, he promises, there will be no busy signal: three new employees with an improved system of telephone PBX, said, "We are anxious calls start coming."
Read more! See the AllBusiness Guide for working with daily deal sites for the latest expert advice and news.
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