Articles
Covid 19: Consumer challenges in the arts, leisure & tourism industries
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Being in the first period of lockdown across the UK, many businesses will now experience a drop in revenue as our economy slows down and people stay at home.
Organisations in the arts, leisure and tourism industries in particular have already had to scale back activities or even cease opening their venues entirely in order to comply with the Government's guidance and deter individuals from attending group gatherings and non-essential travel.
Maintaining a loyal customer base and securing future revenue is essential in the current climate, so here are a few tips of how best to achieve this across five key areas:
All upcoming events will need to be postponed or cancelled. Where possible, venues should seek to postpone events which will allow you to retain any deposit paid by hirers. This also secures future revenue, although be careful not to rebook too soon otherwise you may have to postpone again which could lead to disgruntled customers.
For one off events such as birthday parties or anniversaries, most hirers will just want to cancel and seek a refund. You are likely to earn more customer loyalty by dealing with this in a courteous and professional manner than trying to challenge it – the fact that they chose to book an event with you initially means there’s a good chance they will return for a future booking.
The key exception here is where you have already incurred costs in relation to holding an event which you cannot recover (e.g. hiring a PA system). In such circumstances you may be able to pass these costs onto the hirer, but only where you cannot seek a refund yourselves or where you are unable to reallocate the equipment/catering to another internal function.
Most tickets purchased in advance will need to be refunded, however for those organisations who are charities, you may wish to consider asking customers to donate the cost of their tickets to support your organisation. In return, you could offer them access to digital coverage of events at your venue using archive material, provided they are happy for you to email this to them.
There is no requirement for you to cover customers’ travel and hotel costs in such circumstances and you may want to make this clear to affected customers at the earliest opportunity.
Where customers have purchased an annual membership, they may ask for a refund due to closure of your venue. To maintain funds already accounted for, try offering existing members an extension of their membership rather than agreeing to refund them.
The exact length of the extension is up to you, but the most reasonable approach is to ensure it matches the period of temporary closure.
If you operate in the UK travel sector and customers are able to top up their accounts with credit for use at a later date, those customers may seek a refund of any available credit.
The best option here is to let customers know that their account will be temporarily suspended, which means the credit will stay secure, until such time as the travel restrictions across the UK are lifted.
If your organisation runs a loyalty points scheme you may need to consider waiving these or suspending the scheme for up to 12 months. This will mean customers retain any accrued points for use at a later date, which is likely to maintain customer loyalty, but you may want to consider setting a long stop date by which any existing points must be used.
Most, if not all, holiday bookings will need to be postponed or cancelled for the foreseeable future. The key difference here compared to the other scenarios in this note is that the customers may have the benefit of insurance to help cover any losses they incur as a result of cancellation.
However, this doesn’t help companies manage their own financial challenges. For UK based companies operating in the domestic market, the best option is to ask guests to postpone their booking rather than cancel it. This secures future revenue for companies and may also allow you to keep a holding deposit to ease cash flow.
All upcoming events will need to be postponed or cancelled. Where possible, venues should seek to postpone events which will allow you to retain any deposit paid by hirers. This also secures future revenue, although be careful not to rebook too soon otherwise you may have to postpone again which could lead to disgruntled customers.
For one off events such as birthday parties or anniversaries, most hirers will just want to cancel and seek a refund. You are likely to earn more customer loyalty by dealing with this in a courteous and professional manner than trying to challenge it – the fact that they chose to book an event with you initially means there’s a good chance they will return for a future booking.
The key exception here is where you have already incurred costs in relation to holding an event which you cannot recover (e.g. hiring a PA system). In such circumstances you may be able to pass these costs onto the hirer, but only where you cannot seek a refund yourselves or where you are unable to reallocate the equipment/catering to another internal function.
Most tickets purchased in advance will need to be refunded, however for those organisations who are charities, you may wish to consider asking customers to donate the cost of their tickets to support your organisation. In return, you could offer them access to digital coverage of events at your venue using archive material, provided they are happy for you to email this to them.
There is no requirement for you to cover customers’ travel and hotel costs in such circumstances and you may want to make this clear to affected customers at the earliest opportunity.
Where customers have purchased an annual membership, they may ask for a refund due to closure of your venue. To maintain funds already accounted for, try offering existing members an extension of their membership rather than agreeing to refund them.
The exact length of the extension is up to you, but the most reasonable approach is to ensure it matches the period of temporary closure.
If you operate in the UK travel sector and customers are able to top up their accounts with credit for use at a later date, those customers may seek a refund of any available credit.
The best option here is to let customers know that their account will be temporarily suspended, which means the credit will stay secure, until such time as the travel restrictions across the UK are lifted.
If your organisation runs a loyalty points scheme you may need to consider waiving these or suspending the scheme for up to 12 months. This will mean customers retain any accrued points for use at a later date, which is likely to maintain customer loyalty, but you may want to consider setting a long stop date by which any existing points must be used.
Most, if not all, holiday bookings will need to be postponed or cancelled for the foreseeable future. The key difference here compared to the other scenarios in this note is that the customers may have the benefit of insurance to help cover any losses they incur as a result of cancellation.
However, this doesn’t help companies manage their own financial challenges. For UK based companies operating in the domestic market, the best option is to ask guests to postpone their booking rather than cancel it. This secures future revenue for companies and may also allow you to keep a holding deposit to ease cash flow.
Across all consumer-facing sectors communication with customers is key. Try and keep your website up to date with details of your latest position, and also let customers know that you are working through large volumes of enquiries and ask for their patience at this busy time.
You may also want to acknowledge that dealing with their requests and issuing refunds may take slightly longer than usual due to high demand. Taking these steps should ultimately improve customer satisfaction and hopefully result in increased customer loyalty once the Government lifts the current restrictions.
If you have any queries and would like to get in touch with us, a coordinated team of experts are leading our support and can be contacted collectively using our dedicated inbox: [email protected].
