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"Auctioning Luxury" Is Not An Oxymoron Print E-mail

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Luxury Link, the online auction site, boasts of upward swings in the midst of global plunge.

Luxury Link, whose core business is auctioning luxury vacations, recently sent out a press announcement to the effect that its sales were up 30% in December - after the general drop in luxury brands of all kinds. We talked to Diane McDavitt, LL's president, about how she explains the recent results, and about the company's media coverage. Highlights follow:

  • LL enjoyed a 30% growth in sales in December; the number of new buyers was 27%; and 36% more packages were posted by suppliers than the year before.
  • The pattern is similar to post-9/11, according to McDavitt, who explains that consumers are still traveling "but feel compelled to be smarter. "

  • With marketing budgets smaller, luxury hotels see LL as a way of moving rooms without "discounting." It's a "one-shot deal" on the price. An auction is a way to transcend brands' "best-rate guarantees."
  • Also, for every room sold, hotels hope to generate 20-30 leads from unsuccessful bidders. 
  • New this year at LL is toll-free call forwarding so that a lead is never lost for the hotel.
  • LL measures itself against online travel agencies like the much-larger Expedia and Travelocity, but in a "stand-alone place" with 59% of purchasers being previous buyers on the site. Says McDavitt: "We have the auction mechanism; the others don't."
  • LL's relationship with travel agents is status quo, with the site seeking to serve as the hotel industry's consumer-direct liaison. Anecdotally, says McDavitt, agents do use the site and "when we know about it we recommend to them that they build a markup into the cost."
  • The press release distributed by LL was dubbed "proactive" by McDavitt. While the release gave the impression that "Smart Money, Conde Nast Traveler, Business Week, Travel & Leisure, NBC Nightly News and The New York Times "have all been talking about Luxury Link's surprising trend," those outlets in fact referred more to LL as a potential cost-saving tool. However, McDavitt said the release did precipitate calls from outlets like Smart Money and Conde Nast Traveler.
Harvey Chipkin
 
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From the Editor

Ipsos Mendelsohn and American Express Publishing-Harrison Group
Offer Fresh Insight on Consumer Behavior in 2010


According to new studies from two blue-chip research sources, Ipsos Mendelsohn and American Express Publishing - the affluent are not only ready to travel -- they are frequently going to spend more on it. While the Ipsos study focused on intent and American Express Publishing on mindset, they both point to a surge in affluents taking to the road (Amex sees an increase of 6 to 8% in spending on all luxury categories). Interestingly, both studies agree on a positive attitude despite lingering concerns about the economy. Here's a look at the highlights of both 2010 studies.

LuxuryTravel 360 has long looked to the affluent as a burgeoning market in business and leisure travel, fueling growth in more affordable, common sense luxury - less glitz and glamour, but ready to pay extra for memorable family experiences and genuine local culture.

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