Hotel Upselling & Ways To Generate Consistent Revenue From It
As a hotelier, you have probably heard that upselling is an excellent strategy to increase revenue while boosting guest experience. However, this remark understates the true significance of hotel upselling. Most hoteliers today understand that upselling in hotels is necessary to thrive in the hotel industry. Still, many may be concerned about how it might annoy guests, appear as money-oriented, or in the worst-case scenario, tarnish their reputation.
Revenue targets are often pegged to room sales and attention is mostly given to direct booking and advertising on different distribution channels, all in the effort to increase occupancy and ARR. However, hotels tend to overlook engagements after reservations are made and during their stays to increase opportunities and gain more ancillary revenue. Nurturing these customers who have given you their trust and their reservations is a more effective approach to improving profits at a lower cost.
Fortunately, perfecting your upselling tactics is not quite as intimidating as it might appear. In this article, we share what it means to upsell in hotels and how you can generate consistent revenue from it.
What does it mean to upsell in the hotel industry?
Hotel upselling entails anticipating the wants and needs of guests. It is a planned strategy in which hoteliers offer guests services, items, experiences, and add-ons that they were not expecting at the outset. Room upgrades, early check-ins and late check-outs, spa and wellness treatments, and breakfasts are some prevalent examples of hotel upselling.
If done correctly, upselling benefits both the hotel and their guests – it increases the hotel’s average guest spend and revenue while adding value to the guest experience by allowing them to personalise their stay simultaneously.
Why is upselling important for hotels?
A guest visiting a hotel has a straightforward objective: they want an enjoyable stay. As such, hotel upselling is an excellent technique to maximise guest satisfaction since it allows you to customise their experience and tailor your services to meet their needs, wants, and interests.
Some hotels may be hesitant to upsell as they do not wish to pester guests, but in retrospect, effective upselling focuses on guest experience without disrupting or frustrating guests’ leisure time. Additionally, as mentioned, upselling provides benefits like fostering guest loyalty, generating more income, and maximising the potential of their facilities.
Ways to upsell and generate revenue
Your hotel may have a long list of upsells and cross-sells available for guests, but it is useful to keep in mind that the most effective hotel upsells capitalise on the best on-site guest experiences that you are able to offer at your hotel. If not planned correctly, it might even have a negative impact on customer experiences. For instance, promoting services that is beyond the customers’ means and needs may eventually lead to frustration, making them perceive the hotel as too salesy instead.
When launching an upselling campaign, it would be ideal to begin with no-hassle offers that result in quick wins. Below are a few examples that you may start with right away;
1. Pre-arrival upsell choices
When considering upsell options at the front desk, many visitors might feel overwhelmed. Instead, it would be best to reach out to them with pre-stay suggestions and recommendations prior to their arrival. This way, they have additional time to digest all of the options without feeling like they’re put on the spot, and your hotel will get ample time to prepare the add-ons. Additionally, guests are given more time to ask questions and any clarifications they may have for a more informed purchase.
These are some examples of popular pre-arrival upsell possibilities:
- Guided tours.
- A room upgrade, be it in the form of a larger room or one with more amenities.
- Transportation options such as airport pickup or taxi services.
Upsell possibilities like a room upgrade brings more revenue due to a greater average booking value. This rise may be even bigger in hotels that do not overbook standard rooms, and as a result of upselling, free up more entry level rooms for sale.
2. Provide hotel automation options
Hotel automation is the future of the hospitality industry, and with it, guests will benefit from extra convenience, flexibility, and privacy. Examples of upselling and cross selling through hotel automation include allowing guests to self-service with a facilities booking platform to reserve a payable amenity at their desired time, as well as bypassing the concierge when booking airport transfers.
Additionally, contactless check-in for hotels is also a convenient way for guests who might be arriving at unusual times or prefer increased privacy. Providing upsells in an automated manner is typically popular among travellers as it provides flexibility. As guests grow familiar with the usage of technologies in hotels, this will lead to an increase in sales conversion rates and more revenue.
Automation also allows hotel guests to be able to get answers to their questions quickly and conveniently through a digital concierge and hence, skips the need for waiting in line or on the line.
3. Leverage hotel amenities
Hotel upsells are frequently determined by the experiences and services provided on-site. If your hotel has the following amenities, the upsell chances are endless:
- Meeting lounges and conference rooms.
- Steam rooms and saunas.
- Swimming pools, gyms, and fitness facilities.
- Yoga studios, wellness centres, and spas.
- In-room and community Jacuzzis.
For example, hotels that restrict access to facilities like their swimming pool may provide unlimited usage at a special rate to guests. Additionally, for guests who are interested in wellness activities, the hotel can cross-sell other relevant services like yoga classes and sauna facilities and ensure a holistic experience for all. Doing so would enable guests a better idea of the hotel’s offerings; thus, primes them for more cross-selling opportunities on relevant services.
4. Identifying special occasions
Guests do not necessarily need to come from other countries as travellers. Hotels can benefit from local staycationers celebrating occasions in a special location. Identifying the types of guests and their purpose of stay is a great way to personalise their experience and create upselling opportunities.
Hotel guests visit for a variety of reasons, and engaging them during pre-arrival can allow for better personalisation, such as:
- Couples celebrating an anniversary may be interested in special dining experiences or romantic activities like boat rides at sunset.
- Large group celebrations such as birthday parties may be keen on nightlife recommendations or limo reservations.
- Wedding or bachelor and bachelorette parties might be looking for in-room décor.
Forming memorable experiences for special occasions help create strong emotional attachments for guests and this will likely increase customer loyalty for the hotel. This would also have a positive impact on your hotel’s reputation as guests celebrating occasions are keen to share contents on social media.
When you actively view hotel upselling as an opportunity, it enables you to enhance your guests’ overall experience and your hotel’s reputation – all while bringing in more revenue.
You can give your guests the liberty to build their best hotel experience by utilising guest experience platforms like Vouch’s RevBooster to deliver personalised recommendations, payable or complimentary, to them contactlessly. Additionally, the data garnered from the platform allows you to curate better and more targeted upsells to future guests of similar profiles.
From facilities booking to mobile check-in for hotels, Vouch provides different touch points for hotels to communicate upsells and cross-sells to their guests seamlessly and naturally. Contact us today to learn more about Vouch and all that we have to offer!