We have done groupon (twice), livingsocial, and yelp.
http://www.groupon.com/deals/fly-corona/posts
http://webcache.googleusercontent.c...ingsocial+fly+corona&cd=2&hl=en&ct=clnk&gl=us
http://www.yelp.com/deals/fly-corona-corona
You need to market to Joe Sixpack, who is NOT interested in ground, simulator, books, or other nonsense. You are selling flying, so make sure the meat is there -- these are bargain shoppers who will not be fooled -- our competitiors have offered "fluff" packages (one even offered "20 minutes of flying -- whats that, a lap in the pattern?!) and they do not get nearly the volume they would have with a good offering.
For us, the key to making it work on a per-unit basis was upselling. We sold a 90 minute demo in a C172 for $99 initially. We were set to lose our ass on each and every one. We sold ~700 of them in Feb, and here is what we have seen:
Redemptions are running at about 30% so far, and we expect them to finish at 50%. We have had 5 student conversions, or about 1%. Our deal must be redeemed within a year to get the deal price. If you do the math, this was where we broke even overall -- people are very good at scrutinizing a deal, but very bad about having the time to redeem/remember it. It's strange, but not unlike block time.
On average, we are able to sell them about $30 in merch, to include: logbook, framed photo or video, keychain, toy airplane, whatever. Have the high-margin junk ready and prominently merchandised.
Groupon will negotiate the "split" with you. We keep 70% of the proceeds of the deal, not the base 50%.
Engage the groupon people when the deal is running, their message board will fill with silly questions -- you need someone full time answering questions in an engaging way when the deal runs to keep it fun.
Make sure you enforce your cancellation policy and put it in the deal terms. We learned that these folks are a little flakey -- we amended our policy to be 24 hour cancellation = forfeiture of the funds. We have a list of bad actors who have clobbered our saturday schedule repeatedly.
Along those lines, limit the number of demos available per day. Especially on your peak days. We hosed our students badly with the initial surge. We had to buy 2 more planes to appease them.
==
Of the three companies:
Groupon was a pleasure to deal with, paid early (appx $50k on this deal alone), and have been in touch with us ever since to come up with new and interesting deals. We sold ~700 demos in one shot with them.
Livingsocial were jerks to deal with. They paid on time. We literally had to haggle with them for 2 months before they relented and matched groupon's split with us. We haven't heard back from them since the deal. I think we only sold 100 of these.
Yelp were strange to deal with. They would not let us interact with the client base directly while the deal was going on, and they answered some questions inaccurately, to our frustration. They did not pay at all until we badgered them (and that took 6 weeks) Also, for some reason, both during and after the deal, we had a LOT of people calling our office to ask for a "special direct" price (like, cut out yelp and see if they could squeeze more) -- not sure if this was a paranoid set of yelp shills or what. We sold about 250 or so of these if I recall.
==
We liked it. It smoothed out our winter lull. We have learned a lot about managing expectations and shaping the deal to be compatible with our normal business cycle.
We got the deal "perfected" with our Yelp listing, and will probably do a flavor of it with Groupon again next year. Our final set of tricks:
1. No more 90 minute flight at 1/2 off. Make them buy 3 30 minute flights at 1/2 off (= $147 instead of $99)
2. 24 hour cancellation rule enforced, their code is redeemed at booking, not at flying.
3. Limit 5 demo "slots" per day on Friday, Saturday, and Sunday. Limit 8 demo slots per day for M-Th
==
It's great fun. Make sure your social media integration is dialled in -- make it cake for them to like you on Facebook, and don't "pump" them for reviews. They'll happen naturally.
Your CFIs will get a LOT of tips. While we don't do this, we've considered either paying them a lower rate for doing the demos or trying to mooch on the tips in some other way -- we decided to stay on the high road, but it was tempting -- the CFIs were getting paid the margin we were losing on the deal. Since CFI retention is getting difficult for us, we're very happy to have a way to keep them fat and fed -- they've been averaging $10 in tips per demo flight.
==
I'm happy to answer other questions you might have. Like any other flight school activity, it's a gamble, and the margin can cut you, but you meet people who you wouldn't meet otherwise, they have a blast, and you boost GA overall, so I think it's a win.
$0.02
- Mike
