As consumers continue to become more inclined to make purchases via mobile smartphones, parking apps will become an increasingly important part of growing parking revenue and yield management. At the same time, many parking professionals are not yet mobile app experts or formally trained in the best practices around capturing more business from mobile and online reservations.
If you are selling (or even considering selling) your excess inventory using an online or mobile marketing platform, there are several best practices that will help you capture the most business and make your facility stand out from the one across the street.
We know all the tricks. Today we’re sharing them with you.
As we reveal our recommendations, keep in mind that drivers will only be seeing something like the image below, which is a screenshot from the SpotHero web platform. Most online reservation platforms look similar to this:
10. Signage doesn’t matter.
Mobile consumers are usually deciding between three options: stay home, take public transit, or book parking in advance. If they want to park, they’ll research in advance and choose the closest location with the best rate for the hours they want to park.
Signs for a given operator at a facility don’t make an impact as the consumer has already made a reservation, but signage for the online reservation company can help that consumer locate your facility with ease so they don’t cancel or park with a competitor after not being able to find your facility.
9. Focus on total revenue optimization.
It is a common misconception that lower rates lead to lower overall revenue. When it comes to online and mobile reservations, this is not always the case.
You should offer rates that lead to the highest overall revenue, and this means offering a mix of full-price drive-up rates and lower online rates for more price-sensitive consumers.
This strategy follows the basic principles of supply and demand. If you have excess supply that is empty due to lack of demand at a given rate, you make no money. If you adjust the rate so that demand meets your available supply, your overall sales in any given time period will be higher, even if some cars paid less than others.
8. Be ultra-competitive during off-peak hours.
While maximizing what you charge is ideal, the reality is that during off-peak hours your facility is probably pretty empty. The goal during off-peak hours should be maximizing overall revenue, not just revenue per car parked.
Lowering your online rates during off-peak hours to draw more attention to your facility is the best way to maximize incremental revenue.
Take advantage of the flexibility of dynamic rates offered by a digital platform. You can keep your drive-up rate the same for traditional customers, but then capture more online demand with a lower price point in the hopes that customers will like your facility and come back again during busy hours. Better to make a few bucks than nothing at all, with a chance to grab another loyal customer.
7. Make your online rate sheet as flexible as possible.
In the offline world, changing rates is a pain because you need to get approval, print new signs, and more. In the digital world, you can offer multiple rate types with just the click of a button. The most successful operators in the online reservation space recognize this and are especially flexible and aggressive about the online rates they offer.
For example, If you only offer a 6-hour rate online and a driver is looking for parking for 3 hours, it is highly likely that your 6-hour rate will be more expensive than a competitor’s 3-hour rate listed on the same platform. You just lost that sale.
If you can offer online rates for different time increments (ex: 2, 3, 6, 8, 10, 12, 15, 24 hours), you will capture more sales and make more money per hour.
One common mistake that we see is operators who offer a $12 rate for 15 hours online, but then offer a $10 rate for 12 hours to drive-up customers. Making prices more expensive online and justifying it by offering extra hours is not the most effective strategy for maximizing revenue.
If an online customer sees they have been charged more than drive-up to park for hours they don’t even need, they often leave poor garage reviews and have a low chance of parking at that facility again, with or without a reservation.
You may make a quick buck, but in the long run it hurts the reputation of your facility and the success you’ll have with online reservations.
Now that we know that price is the first thing that people see when looking for parking online, what else can help you get more business from your online reservation partner?
6. You need a good photograph of the entrance of your facility.
Having an A+ photograph of your facility online could determine whether or not someone feels comfortable parking there. The image also helps drivers recognize your facility from the street after making a reservation, so they don’t get lost and cancel the reservation last minute.
Given two similarly priced locations across the street, consumers may check out the photographs online to determine which to choose.
If your online reservation partner asks for photographs of your facility or permission to take them, it’s in your best interest to provide quality images or work with them to hire a professional photographer.
5. Clear directions to your facility are key, too.
Clear and accurate driving directions are crucial to the customer’s experience. Without clear directions, online customers may get lost and request a refund. If they manage to find your facility despite confusing driving directions, they will rate their overall experience at your facility less favorably which can hurt your online sales in the long run.
4. Treat your online customers like VIP’s.
While it is hard to measure how satisfied most customers are, with online reservations it is really easy because after each reservation the customer is asked for feedback on their experience.
Bad experiences, due to anything from miscommunication with attendants, to getting overcharged, to not being able to find a spot, are quickly exposed and the word spreads fast.
It is in your best interest to make sure your online reservation redemption process runs smoothly. It’s vital that your attendants are ready for customers with online and mobile reservations. If their experience at your facility is great, they will be more likely to return via drive-up or an online reservation in the future.
Be sure to work with your online reservation partners to make parking as easy as possible, otherwise we all lose next time the customer decides not to drive.
3. Cannibalizing your existing customers should not be a fear.
One common fear about online reservations is cannibalization, the idea that if you sell parking online at a lower price, all of your customers will find out and start reserving online.
While we understand the fear, in practice it just doesn’t happen. We’ve worked with hundreds of parking partners across over a dozen cities and this is rarely, if ever, the case.
Here’s why. If your facility is at capacity during the day and empty at night, list spots on an online or mobile platform at night. Your daily commuters aren’t going to suddenly start driving to work at night.
If you, on average, have 5 empty spots during the day, only sell those 5 spots online. Your hundreds of other customers can’t all buy the 5 spots with special online rates. Even if they do, and you still sell out your regularly priced spots, then you’re still at capacity.
If you are concerned about cannibalization, know that you have full control of your listing and can make changes at any time.
In the world of commuting, there are people who will always pay drive up, people who will never drive, and then a group of price sensitive tech-savvy folks who decide every day if they should take public transit, Uber, or drive.
If we can work together to make driving the most convenient and reasonably affordable option, we make the parking pie bigger and everyone wins. Opting out of the future just isn’t a winning strategy.
2. Use the marketplace to determine online rates.
When a consumer is looking to book a parking reservation online, they often haven’t decided to drive yet. For this reason, you are actually competing against other forms of transit for their business. Think Uber, public transportation, or even biking.
Although driving can be more convenient, many of these consumers are looking to make the most cost-effective transportation decision. For example, if parking at the airport is $50 a day, more cost-sensitive consumers will opt for taking public transportation or an Uber as it could save them a significant amount of money. However, there is a price that people are willing to pay for the convenience of driving their own car. Figure out what it is by altering your online rates and measuring revenue changes.
The same strategy applies for parking at events or even just downtown. With online and mobile reservations you are always competing agains other forms of transportation. Use the flexibility of the platform and change your rates until you find the one that generates the most demand at your facility, because drivers are willing to pay for that convenience.
1. You should definitely sell monthly parking online.
Monthly parking provides steady monthly income you can count on, and tons of drivers are looking for monthly spots online.
Many online parking reservation platforms are not just for transient parking. If you have excess inventory you would like to fill with monthly parkers, talk to your online parking partner about selling monthly spots as well.
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