Many companies are using social media to help them gauge demand for a product. For example, Manning says, a company in Brazil has developed coat hangers that display how many Facebook ‘likes’ a particular piece of clothing has, and can adjust the price accordingly.
Many of these trials are ultimately little more than short-term PR gimmicks, Manning says. And as gimmicks, their value will decrease as the novelty wears off.
“But ultimately, social media’s only been around for five years or so,” Manning says. “It’s being used in pricing in a lot of interesting ways, and no one’s really the expert on how it all works.”
Fischmann acknowledges there was a fair bit of guesswork involved in the 10,000 figure.
The whole idea, he tells SmartCompany, came out of a desire to find a way to leverage the natural tendency of hotel guests to photograph the pretty things they see.
“Basically, what we did was we sat around with our marketing and social media people. I said, ‘how do we get our guests who are already in-house to share their experiences on their own social network about the hotel? How do we provide some platform to encourage them to do that?’ Of course, some of them would already be doing that, but we wanted to encourage it.
“So, we came up with a concept of using Instagram. We knew we were going have an interesting hotel from a design point-of-view. And we thought photography would showcase that.
“It all moved on from there. We created a ‘selfie’ frame, where people can take pictures of themselves. We came up with Insta-walk, which is a map of cool places in the surrounding areas worth Instagramming. We tell people to hashtag their photos with #1888, and our staff choose the coolest picture per month, and that person gets to stay a night for free.”
When this all went out in a press release, Fischmann says, the press “went crazy”. Elements of the hotel were exaggerated. The ‘selfie frame’ became a ‘selfie room’ in some reports, for example.
And the requests for free rooms came pouring in. The hotel has been open since July 1, but Fischmann says he still gets a couple of requests a day.
Originally, he and his team weren’t sure whether there were enough people with 10,000 Instagram followers. It turns out there are plenty. And most are based overseas.
That’s helped keep costs of the promotion down.
“Sure, it’s a free night’s stay,” Fischmann says. “But most, if they’re not based in Sydney, choose to stay for more than one night. So that’s business we otherwise wouldn’t have gotten.”
And anyway, Fischmann says, hotels have always given away free rooms; to journalists, for example, in exchange for good publicity.
It’s a point also raised by O’Brien, who says if part of social media is about making everyone a publisher, it stands to reason that influential social media publishers would be as desirable to court as traditional publishers have been in the past.
“Sure there’s a novelty to what’s going on now, but I don’t think it’s anything fundamentally new,” he says.
“It’s just that different types of people are also now being considered influential.”
Giving away free stuff to influential people on social media can, if declared, be far more transparent than the traditional ways of getting coverage, Fischmann says. “I think people are becoming far more cynical of things that are fake, or overly engineered. This is more authentic and transparent.
“We don’t spend money on advertising; we’d rather do things like this. Sure, the press has taken what we’ve done and run with it to a level we didn’t expect, and we’re very grateful for that.
“But we get a real kick out of following our hashtag. Huge numbers of people are seeing our hotel, and they’re seeing it through the eyes of our guests, who aren’t fancy photographers or anything. It’s a truer representation.”
Disclosure: Tomely co-founder Connor O’Brien is a personal friend and former colleague of the author.
Myriam Robin is a reporter for SmartCompany and its sister site LeadingCompany. She has degrees in economics, international studies and journalism. She likes writing about businesses taking risks and doing new things.
