Selling is easier but upselling is an art in itself.
Upselling is a great business opportunity to increase the average revenue a hotel makes from a customer. It is the practice of encouraging your guests to pay more for a similar but higher quality product. Well, let’s explore what it is, its benefits to hoteliers, why you should do so and what are the various ways of upselling in the hospitality industry.
What is upselling in hotels?
Upselling is the best method for hotels to generate more revenue. Basically, it is when a hotel promotes additional services to guests, such as a spa, breakfast buffet, room upgrades and more. Be it a small, mid or large-sized hotel business; upselling is an efficient option for every property type.
Stats say, 60% of consumers would be spending more if an additional service compliments or enhances their main purchase.
Hence, doing so would not only help in improving guest experience but would also enhance your revenue.
What are the benefits of upselling in hotels?
When it comes to upselling, knowing your customer and selling it at the RIGHT time is everything you need to focus on. Moreover, have a complete database of their likes, dislikes, etc. and offer them something which they are fond of.
Let’s look into the benefits of doing so:
- Higher profitability.
- Increased revenue.
- Greater utilization of hotel facilities.
- Better guest experience.
- More hotel occupancy.
Hence, the beauty of up-selling is it allows you to enhance your profits without even having to spend huge amounts of money on marketing activities.
What is the difference between upselling and cross-selling?
Cross-selling is a widely confusing term with upselling. Although both are entirely different and upselling is interchangeably used with cross-selling. So, here we’re explaining to you its difference.
UPSELLING
Upselling is the process of selling a more expensive version of the service or product to your guests. Examples of upselling: room upgrade, indoor activities, any added service and so on. It can be done either when the guest searches for your hotel, during their purchase or once the booking is made.
CROSS-SELLING
Cross-selling involves selling additional products or services with the original purchase to enhance the experience and provide a complete package. Example of cross-selling: adventure activities, or city tours and such likes. This can be most effective when the guest has arrived at your hotel (i.e point of sales).
Hence, one of the best ways to boost revenue and make the most of your business is by applying the best upselling as well as cross-selling strategies.
Both have their own advantages and practicing it in an organized manner would definitely help you reap good returns for your business.
Moreover, It allows you to utilize all your hotel’s amenities and products with an increase in the level of personalization to your guests.
How can hotels upsell to their guests?
Upselling needs to be handled with a degree of sensitivity, say the timing, tone, and regularity with which you upsell is vital to the success of your efforts.
Make sure not to sound like a sales pitch. Rather deliver it in a way that your guests know what options are available for them and how you are ensuring to offer your best services.
However, there are several ways through which you can upsell in hotels. Let’s have a look at each one of these hotel upselling strategies.
Table of contents
1. Identify the target audience
Primarily, identify the customers that are good targets for upselling which may include business travelers, honeymooners, vacationers, etc. Well, not every customer is a good fit for an upsell; so never try to push additional products or services on someone who doesn’t truly need them.
Guests who have spent on additional purchases in the past are a great place to start. Accordingly, you can get relevant ideas to upsell to the upcoming ones.
For example:
Do couples often order a bottle of wine or champagne from room service? OR
Did you receive more bookings for a superior room type having more facilities? OR
Do your business travellers take advantage of last-minute deals?
Well, as the purpose of upselling in hotels is to augment guest’s experience, it actually can be challenging to figure out the right audience and their needs too. So, act wisely!
2. Determine the right time
Upselling to your guests at the RIGHT time matters the most. Pitching a service exactly at the time when your guests are in need of it is an essential way to boost business. This helps you to gain more revenue as well as utilize your additional hotel services.
You can do this by sending effective emails to them either during booking, after arrival or once they check-out.
Moreover, if they had a great experience staying at your hotel then such guests would definitely share good reviews; thus enhancing your online reputation as well.
3. Understand guest preferences
A good way to do this is, to send an email to your guests prior to their arrival inquiring about any preferences or requests they may have. This gives you an idea of their likes or dislikes and allows you to upsell services in regards to it.
For example, some may like spa services or roaming around to explore the local culture or adventure activities and more.
Depending on these or other such likes, upsell services to your guests accordingly. Moreover, you can create a complete database of your guests’ details for better reference.
4. Use proper booking confirmation templates
Email marketing is an effective tool to attract more guests and upsell services. Send out emails to your guests and let them know about your special offers.
Once you receive the booking make sure you send a booking confirmation email to your guests. Moreover, you can also highlight facilities like spa, pool, yoga, gym, etc. to encourage them in utilizing these services.
Do the exercise in intervals until they visit your hotel or even after the checkout. Make sure each of your emails has some important offering of your property to showcase them; thus earning great ROI for your business.
5. Offer something local
Upselling local offerings along with the accommodation has higher chances for bookings. Although, this will not only enhance your bookings but will also encourage guests to purchase your services.
For example, if your local wine or local cloth is famous then you can upsell such types of services to enhance sales as well as room occupancy.
This can be done mainly because guests are often more interested in purchasing or exploring such things.
6. Highlight upsells on your website and social media
Social media is the latest trend to highlight your extra services and attract more guests. Showcase best offers, combo packages, and deals on your website as well as on your social media profiles.
You can also post Carousel images on social media platforms, highlighting the various offerings you have at your property.
For example, “Pay additional $5 and get spa service FREE” OR “Stay one more night and upgrade your couple booking to a suite room.”
Moreover, you can upsell services through your booking engine by making use of the plug and play widgets too.
7. Use group bookings to your advantage
Group bookings are an added advantage. These bookings can be either for weddings, business conferences or family get-togethers.
And, often hoteliers like you must be experiencing additional requirements of rooms, extra bedding due to an increase in the number of guests and so on.
Such times can actually help you to upsell your services and gain a higher revenue through various amenities at your property.
8. Run loyalty programs
Running loyalty programs is one of the finest techniques to upsell and increase repeat guests at your hotel. Such programs will not only help you to increase your hotel’s occupancy but also make use of your additional services and create an even stronger relationship with your guests.
For example, send personal emails by offering them special discounts, offers, reward points and much more to attract them.
For this, all you need is an accurate guest’s database, transaction history, reports of your guest, and an apt loyalty management software for your hotel. This software will help you build, run and maintain all the operations of your hotel loyalty programs.
9. Don’t miss out on obvious things
Encourage guests to begin their stay on a relaxed note with a drink at the bar, or celebrate any special occasions through banquet deals, add fruit and chocolate or other extras like a beer or so to their room, or order dessert after the main meal.
In addition to this, offer them services like room upgrades, transport facilities, hiring a car or a bike and much more.
Make sure you always present as many options as possible so guests are making their own choice rather than just following your recommendation.
Commonly asked questions
Upselling is convincing the customer to upgrade their product or buy a more expensive version of it. Below are the effective steps to do so:
1. Choose and offer the RIGHT upsell.
2. Make your upsell relevant.
3. Personalize your recommendations.
4. Get the language right.
5. Use urgency.
6. Offer the best possible service.
Hotel upselling is a valuable technique for increasing your sales and profit margins. Moreover, it helps to build better relationships with your guests as well as increases their lifetime value thus urging them to come back to you.
Upselling happens when you promote add-on items to a guest that’s about to purchase your service (usually at a higher cost). For example: in case where the guest is booking your hotel room, you can convince them to pay $10 more and get a room upgrade or some additional service along with it like a spa or a massage.
Here are the best ways to build guest relationships and encourage repeat guests:
1. Communication is an essential way.
2. Exceed their expectations.
3. Ask for feedback.
4. Connect them through social media.
5. Show appreciation through loyalty discount programs.
Conclusion
Ultimately, it’s about knowing your guests and their needs rightly. Remember to offer relevant products at the RIGHT TIME to the RIGHT GUESTS, and you’ll have effective upselling techniques for your hotel in no time!
Make sure your secondary products are ideally personalized to each customer, emails are well-timed, and customers should be able to clearly see the value of what they’re paying extra for.
If hotels take the time to understand what their guests want and accordingly upsell their products and services; then a boost in revenue would definitely arise in no time.
