Increase Revenue with These Hotel Upselling Techniques

July 9, 2020
Increase Revenue with These Hotel Upselling Techniques

Hotel sales is a vast subject with many moving parts and challenges. But not every part of a sales strategy is an uphill battle. There are many small wins you can gain that helps you increase revenue by using hotel upselling techniques that are much easier than you think.

The cost to acquire a customer is much higher than the cost to retain a customer. The same concept is applied when upselling a customer. You are 5-20% more likely to sell to a new prospect. However, the probability of selling to an existing customer is 60-70%. Knowing this, you can increase revenue by adjusting certain parts of your sales strategy and build deeper connections with customers, while using your property’s amenities more effectively.

What is upselling in hotel sales?

You’ve all experienced in one way or another. Been to Mcdonalds? You’ve probably upgraded your order to a meal. Been to a grocery store? You’ve bought packs of gum and snacks while standing in line waiting to pay. Upselling comes in all forms, shapes, and sizes.

Hotel upselling techniques are essentially offering your customers relevant extras that make their stay or event even better. It involves getting your customer to more on their current expenditure, like upgrading their current room. Cross-selling refers to selling add-on products or services like purchasing a spa package or featured tour, aside from already paying for their room. Besides the obvious benefits of increasing revenue, upselling also increases customer satisfaction and loyalty through personalized service and added value from their stay. Upselling also offers a richer pool of data for future feature planning and guest personalization. Lastly, your amenities will be even better utilized.

Keep reading on how to incorporate hotel upselling techniques in your sales strategy.

1 - Identify the right customers for upselling

You will first need to identify the type of customers that are good for upselling and cross-selling. Not every customer will be a good fit and never push products and services on a customer that really doesn’t need them. General rule of thumb is: if you can’t explain how purchasing the additional product or service will benefit the customer’s overall goals then it is not worth it.

You’ll want to mine your PMS and CRM to determine your upselling targets. Look for guests that have spent money on upgrades on ancillary products in the past - this is a great place to start. Also, look for types of guests that will have a specific type of behaviour. For example, is there a wedding party coming? They may need to add extra rooms right before the big day. Or a couple that’s booked their anniversary - they often want to order an extra bottle of wine or champagne. Identifying these types of customers and associated purchasing behaviours will give you an idea of what opportunities to seize. In turn, your guests will often be thankful in your ability to anticipate their needs like the extra room or bottle of champagne before their arrival.

It can get a little tricky to figure out when the appropriate time is to introduce upselling into your sales process. The key is to remember that the objective here is to elevate your customer’s experience - with this in mind, it actually has a place throughout the entire sales process, as long as the value is apparent.

Continue reading to learn about where upselling and cross-selling make sense for your guests and your hotel, especially to increase your group business.

hotel group sales ebook

2 - Include targeted upsells and cross-sells on your website

An obvious, yet effective hotel upselling technique is to make it apparent and available to your guests by featuring them on your website. Before customers have even booked their room or event, they are browsing different websites for the right product to fit their needs and criteria. By including relevant offers throughout your website, this increases the chances of your guest coming across something they like, adding value to your proposition.

Place upselling offers near products or services that are associated with upgrades, customizations and other similar value-added features. Use easy-to-read fonts and graphics that don’t take away from your website, but do their job by highlighting the offer. Once posted, make sure to conduct an analysis of what works and what doesn’t and then tweak your strategy where necessary.

It’s important to note that you don’t have to be a big chain or luxury destination to be able to offer guests added value! Properties of all types can upsell. Some examples of popular products and services that can be upsold/cross-sold include:

  • Room upgrades: tried and true. It’s simple but very effective.
  • Packages: you can create different packages of amenities for different types of guest segments to ensure you’re increasing value for your guests
  • Food and beverages: things like breakfast, a romantic dinner-for-two, cocktail hour at the hotel bar.
  • In-room extras: think about what you’d like to enjoy - a bottle of wine, snacks, or a premium minibar offerings are all great options
  • Activities: partnerships with local companies are a win-win here or you can offer and run your own activities

3 - Enhance the checking-out process

Offering relevant products and services right before the final checkout page is a great hotel upselling technique. Your guests have already committed to purchase from you and may be willing to spend that little bit more for an amazing experience. These enhancements should be relevant to the guest demographic, and personalized as best you can.

The offers should also be in line with how guests would regularly use your hotel. For example, if your hotel is located in a city where business travelers often rent a car, you could offer parking as an add-on. Alternatively, if you’re located in a city where a specific type of food is famous, you could offer a food tour of that type or a tasting menu.

Lastly, make it easy for your guest to be able to add this to their cart and check-out. If you make it one bit difficult, your guest might opt out completely.

4 - Partner with local businesses to expand your hotel’s reach

To feature activities outside of the hotel, you can use strategic partnerships with local businesses to expand your reach. For example, city tours, spa packages, adventure packages, and food tours all show off your city’s charms. You guests will love that they can arrange it all in one place and you can increase revenue by curbing that small percentage off of each booking. These experiences increase your customer’s satisfaction during their stay by giving them positive memories and increase their loyalty to come back and stay again.

For activities outside of the hotel, you can boost your reach with strategic partnerships with local businesses. For instance, you can offer your guests city tours, day spa packages, adventure trips, or walking food tours that show off your city’s charm. Your guests will feel happier because they can arrange all of their entertainment on one platform, and you can generate higher.

5 - Pre-stay upsell email

Another great hotel upselling technique is the pre-stay email. Send your guest an automated email before their anticipated stay and have them fill out a form that informs you of any gaps in the guest’s plan. Have they thought about transport between airport and hotel? What about breakfast every morning? Do they have activities on their itinerary yet? This helps the guest plan the logistics part of the stay and gives you an opportunity to make it easier on your guests, while increasing the bottom line.

6 - The check-in isn’t just about checking-in

The check-in is often the most overlooked, yet one of the most important times to upsell. People often say that the trip doesn’t officially start until they’ve check in, and as soon as that mental state switches from on duty to offline and chilling, your guests will be more receptive to add-on products or services that will enhance their experience.

Your front desk staff should be proactive and knowledgeable about the guest and what to offer different guest segments. They should be aware of upgrade options, rooms with special features like better views, mini bar, or kitchenette. This is also your opportunity to educate your guests of any exclusive dining or spa packages, or other hotel services that are deemed relevant to that specific guest. Staff should be trained on how to offer these add-ons as customer service, and not an aggressive sales approach so the gust can feel cared for as opposed to being sold-to when checking-in.

7 - Improve the guest loyalty post-stay through upselling

Now that we’ve talked about hotel upselling techniques before and during your guest’s stay, you can also implement upselling post-stay as well. During check-out, your reception staff can check on how things went during their trip as well as invite guests to join your loyalty program (if you haven’t yet already) and offer them some incentives for their next stay like a voucher or free breakfast. After they’ve left, post-stay emails thanking them for staying at your hotel can also promote return offers. This creates excitement and motivation for them to want to book with you in the future.

8 - Use your CRM to identify trends and keep testing to upsell

Don't forget about your technology to help you with hotel upselling techniques! Leveraging your CRM is essential in defining your target segments, but is also essential to forecast what types of offers you should be providing because of the rich guest data and historical guest transactions you can pull. By testing a variety of different hotel upselling promos with different customer segments, you can begin to analyze and tweak the entire strategy. This will create the best guests experiences and be most efficient at raising the bottom line at your hotel.

Guess & Test

Trying new things are what hotel upselling techniques are all about. Once you’ve been able to successfully upsell to a few customers, you will then begin to develop a better understanding of what customers benefit most from which products and services. Ensure to keep track of the activities you’re doing, your segments, your different marketing for different promos and don’t be afraid to mix it up. Incorporate positive trends into your sales process and proactively continue to identify upselling opportunities on an ongoing basis. Just remember: relevant products X right time X right guests = successful upselling hotel strategy.

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