Upselling Strategies That Boost Revenue and Enhance Guest Experience in Hotels

If you're looking for a faster and easier way to qualify leads and book more viewings, adopt conversational marketing. Selling hotel services can be tough, but there are smart strategies that simplify it. The chances of making a sale to a new client are only 5-20%, but to an existing customer they go up to 60-70%. By applying this knowledge and some key upselling techniques during your sales process, you can increase revenue, improve customer relationships and make better use of the hotel's amenities.

Upselling can turn a good guest experience into a great one and leave a lasting impression. It's a valuable but often overlooked part of a hotel's revenue and customer experience plan. According to Phocuswire, upsells can create a $28 billion opportunity for a property, as well as increase customer retention and build loyalty.

So, how can hotels put an upselling strategy into action? Let's explore ways to apply this technique to the entire guest journey.

What is Upselling?

Upselling means offering guests extra features or add-ons to make their stay better for an additional cost. Notably, a good strategy involves creating relevant offers that fit your guests' preferences. These add-ons should be well-thought-out to genuinely enhance the experience.

When upselling, you encourage your customers to spend more on their current choice, for example, upgrading their room. Cross-selling, on the other hand, is where you sell additional products or services besides the room reservation, such as a spa treatment or a local tour.

Customers often welcome the opportunity to purchase a more expensive option when they recognize its value, convenience and relevance to their stay. So, how can you integrate upselling into your hotel's sales cycle?

What Should You Upsell?

Upselling is a win-win for hotels and guests. It helps businesses make more money while improving the guest experience. Here are the benefits:

  • Guest Satisfaction

Upselling gives guests the opportunity to tailor their stay based on their preferences. They can upgrade to a room with a more beautiful view, take advantage of amenities such as spa services or room service, or make special requests to personalize their experience.

  • Guest Loyalty

Guests are more likely to return to a hotel that consistently offers customized experiences and caters to their preferences, building long-term relationships.

  • Increased Profitability

Hotels make more profit because engaged guests spend 46% more each year than less engaged ones. By offering relevant upselling options and demonstrating the value they bring, hotels can encourage guests to spend more on additional services, upgrades or amenities, increasing revenue and overall profitability.

  • Reduced Risks for Hotels

During the pandemic, total hotel revenue per available room declined by 63.3%, but strong upselling strategies resulted in only a 31.7% decline per occupied room, showing that revenue was maintained even in difficult times.

8 Best Hotel Upselling Techniques

From personalized offers to strategic timing to seamless software integration, we highlight the best upselling techniques for hotels to maximize revenue and enhance their guest experience.

  • Personalize the Experience

Remember that it can be difficult to achieve even a 2% average conversion rate. That's why it's essential to present the right content to the right audience. This will require some upfront investment, but will save you from paying high commission fees in the long run. Besides, give travelers tips about the location when you promote to add extra value.

Also, make sure your hotel website is user-friendly, that it has an easy-to-use booking engine, and that all the necessary information is clearly listed in the FAQs. This simplifies the booking process and improves the guest experience.

  • Customize Offers for Different Guest Segments

Knowing your guests is critical to targeting them with personalized offers. If you don't know their preferences, you can't make targeted ads or offers. But, sometimes, it's tough to get to know them before you get in touch with them. In such cases, it helps to divide guests into different segments.

There are several ways to segment guests—for example, by couples, families, or businesses. You can also sort them by their location. Whichever method you choose, make sure you use specific information from your PMS to be as effective as possible. When you use guest data, you can create customized offers that will skyrocket your upselling conversion rate.

  • Timing is Key: Reaching Out and Presenting the Offer

If you can upsell the right service at the right moment, you'll boost your revenue effortlessly. When a guest books a hotel room, they're ready to level up their stay with a few cool extras. They might also consider upgrading to a better room, adding transportation, or choosing from exciting hotel activities.

Keep in mind that the time before arrival is the golden opportunity for upselling. This is the time when guests are most open to grabbing those extra offers.

  • Boost Conversions with Upselling Packages

70% of business travelers want more than basic hotel services. They are keen on purchasing additional services and amenities, and the best part is that they can conveniently claim these as business expenses. So, it's essential for hotels to tap into this opportunity and offer enticing add-ons to cater to the needs and wants of these travelers.

To appeal to a specific group, you can offer intriguing add-on amenities such as food and beverage, fitness facilities or convenient cleaning services. With these added options, hotels can enhance the guest experience and meet the unique needs of business travelers, while increasing revenue.

  • Showcase Offerings with Visuals

Images play a crucial role in purchase decisions, with 91% of consumers currently preferring interactive and visual content over conventional text-based or static content. By incorporating compelling visuals into your communications, you can effectively showcase your offerings and capture the attention of potential customers.

Such content has the power to stir emotions, create desire and provide a clearer understanding of your offering, which ultimately increases the chances of a successful sale. So, use the compelling power of images to visually entice and engage your audience and make your product or service more attractive to potential customers.

  • Streamline Upselling with Software

Increase your team's efficiency and streamline guest communication by using upselling software for hotels. Specialized tools like PMS, messaging platforms or upselling systems automate the process and make it seamless and hassle-free for both your staff and guests. From pre-arrival, room-upgrade offers to in-room additions, the software ensures timely and personalized upselling opportunities at various touchpoints, ultimately maximizing revenue and guest satisfaction.

  • Seamless Integration with Your PMS

For a smooth and efficient upselling process, it's essential to choose upselling software that integrates seamlessly with your PMS. This integration allows for a seamless flow of information between the upselling platform and your property management system, eliminating the need for manual data entry and reducing the risk of errors. By bringing everything into a single system, your team can streamline operations and save time.

  • Collaborate with Local Businesses and Attractions

By capitalizing on your location and nearby attractions, you can offer alluring deals to your guests that include experiences at popular restaurants or tours. To maximize upselling opportunities, you can create packages that combine local attractions with additional amenities at your property, such as special after-dinner drinks in your hotel bar in combo with a local restaurant package. In this way, you not only enhance the guest experience, but also boost revenue through thoughtful and engaging upselling offers.

Wrapping Up

As you successfully upsell a few customers, you'll get a better idea of what types of guests benefit most from additional products. Keep track of their common traits and timings, and incorporate these insights into your sales process to proactively identify upselling opportunities.

Integrating upsells into the overall guest journey goes beyond smart revenue management; it leads to higher guest satisfaction and loyalty. With upsell technology, hoteliers can automate touchpoints effortlessly. Don't forget to gauge the most popular offers with your target audience and gather feedback for continuous improvement.