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Cheap is the New Sex.
By Yeoh Siew Hoon
Friday, 7th August 2009
 
Okay, we wrote that just to get your attention!

Did it work? Yeoh Siew Hoon tackles the question of cheap at a time when consumers want cheap and service providers are selling cheap.

It is an old joke among newspaper hacks that if you want to sell copies – or in today's jargon, grab eyeballs – your headline had to have any of these three words in it – "win", "free" or "sex".

Of course if you put it all together, "win free sex", then it'd do more than grab eyeballs; it'd probably make them pop.

In the Year of the Deal though, another word has emerged – CHEAP.

I was reminded of that during the radio interview I did last week on 93.8 LIVE in the Living Room programme where I had an opportunity to talk about travel and online travel trends.

Most of the questions I got were about how to ensure you got the cheapest flights and does shopping and buying online always guarantee you the cheapest deals?

I suppose it's no surprise – we have an extremely price-conscious consumer on our hands right now. I mean, we were price-conscious before but now, even more so when most of us are a little poorer and our cup overfloweth with deals.

I have a friend who markets a high-end villa in Samui, Thailand and she told me that where before, no one ever asked any questions about price and just came to live it up, today they are asking questions, comparing prices and going for the cheaper alternatives.

"Even if they have the money to spend, they are not spending it like they used to," she said. "How it's changed in just months."

Starwood's offer of 50% off at all its hotels worldwide is yet another giant goodie bag that's been handed to consumers.

How can we not help but be price-conscious? In fact, consumers have become price-paranoid – that constant fear of losing out – what if I booked, and there's a cheaper deal somewhere out there?

Anyway, I tried to share some tips on the best times to book low cost flights. Book early, book mid-week if possible, avoid Mondays and Fridays, book a mid-day flight if there are several a day, sign up for their newsletters to get early alerts … and oh yes, watch all those terms and conditions including baggage allowance because it's in the ancillary revenues where they get you.

As for whether one always gets the cheapest deals from shopping online, I said no. I said shopping online gives you greater choice and convenience such as the ability to compare several deals at one time and the ease of booking after you have decided – but it's not guaranteed to be the cheapest.

I have to give it to my host, Pamela Ho, who kept coming after me with the question on where and how to get the cheapest deals.

I finally had to respond that cheap is paying what you think is the right price for the product and service that you want. It's about value perception – if I feel I am getting the right value for the price I have paid, then it can be regarded as cheap.

Women know this well. A girlfriend just bought a Kate Spade handbag. She thinks it's cheap because she got it at 50% off.

One woman's cheap is her husband's "OMG, how can you pay so much for that little thing?"

In the end, I drew an analogy with food because everyone can relate to that, especially in Singapore. "What's the point of paying $1 for a plate of noodles if it's inedible? That's not cheap. You've just wasted $1."

So really, cheap is relative but value is subjective.

Of course if you are like that crazy, cantankerous and, lest we forget, clever Irishman who runs Ryanair, Michael O' Leary, and you manage to sell Cheap & Value, then you may have a winning formula in the Year of the Deal.

Here's someone who insults customers – "What part of ‘no refund' do you not understand?"; and who promises no service –  "Our customer service is unlike every other airline, which has this image of, ‘We want to fall down at your feet and you can walk all over us and the customer is always right,' and all that nonsense."

Yet his airline continues to post profits – even though post-tax profit fell by 78% in the year that ended in March, it still amounted to $149 million – and it expects its passenger numbers to increase, to 68 million this year from 57 million in 2008.

The four things he promises: low fares, a good on-time record, few cancellations and few lost bags.

Simple. Cheap. Value. That's the eyeball-grabbing headline for today.

Yeoh Siew Hoon, one of Asia's most respected travel editors and commentators, writes a regular column on news, trends and issues in the hospitality industry for 4Hoteliers.com.

Siew Hoon, who has covered the tourism industry in Asia/Pacific for the past 20 years, runs SHY Ventures Pte Ltd. Her other writings can be found at www.thetransitcafe.com

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