Expert’s Voice: Upselling – pushy hotel sales technique or invaluable skill?

by | 02 Jun 2020 | People

The role of upselling and cross-selling is even more important for hotels post-Covid-19.

Upselling may not always have the best reputation in the hotel industry, but when done correctly it can boost revenues and help guests get more out of their stay, writes hospitality specialist Juliana Hahn.

People are talking and writing about it more than ever – ways to create more revenue at hotels.

Positive news of consumers’ strong intent to travel after the crisis paired with the first signs of demand recovery in China has raised an important topic in the hospitality industry: how can hotels make the most of returning demand?

Upselling is a recurring answer to this question. But while some hoteliers are more than happy to do this, others write it off as a pushy sales technique they don’t want to harass their guests with.

However, is upselling really that bad? And could it be something more than just a way to drive ancillary revenue in hotels? I asked a few experts on the topic and they shared interesting insights on how hotels can go about upselling, so properties and their guests can enjoy a win-win situation.

First of all… what is upselling and cross-selling? In short, upselling means you offer customers a similar yet higher-priced product to the one they chose. For hotels, this means, for example, suggesting the more expensive deluxe room instead of a standard room.

Cross-selling is when you promote an additional product which would go well with something a customer has already bought. A hotel, for instance, might offer an airport transfer, laundry service or a tour package to guests who recently reserved a room.

It’s here, it’s there, it’s everywhere

Now, before you go on judging hotels for trying to push people to spend ‘so much extra money’, think about how common both upselling and cross-selling are today. It’s everywhere and we accept or even expect it.

When you go to McDonald’s, the clerk asks you if you want the supersized meal or whether you’d like fries with your order. Airlines offer you emergency row seats for an extra cost because of their legroom. On Amazon, the subtle yet effective ‘Customers Who Bought This Item Also Bought’ area generates 35% of the retail giant’s revenue.

Not bad, eh? Seeing numbers like that makes me wonder why more hotels don’t jump at the opportunity to promote offers, services and amenities they have at their hotel anyway.

Upselling then and now

At hotels, upselling started with front-desk agents offering guests a higher room category on arrival. This tedious process had low success rates and even came with some disadvantages.

Check-in was drawn out by the upselling pitch and guests who opted in had to wait while housekeeping and room service scrambled to prepare the new room.

Cross-selling was similar. The front-desk agent or concierge would highlight hotel amenities and encourage guests to book a dinner table or a spa treatment. After that, it was largely up to the guest to take action.

Today, new software allows hotels to take a more efficient and effective approach. They can send both upsell and cross-sell offers pre-arrival and target guests by segment rather than relying on general email blasts with generic promotions.

What upselling and cross-selling really are

When asked about upselling and cross-selling, experts often give this familiar-sounding definition: offering the right product to the right guest at the right time.

This summarises the important aspects of relevance, timing and segmentation perfectly. But upselling and cross-selling can be so much more when they’re done right.

However, many hoteliers leave active cross-selling on the sidelines and only focus on upselling to make some extra revenue when overbooking a low room category.

And while that’s a great place to start, using upselling just for that would be like using only the large blade on your Swiss Army knife and never trying the scissors, can opener or the small blade.

Expanding the idea of upselling and cross-selling

With upselling apps allowing hotels to reach out to guests pre-arrival, the opportunities for promoting services and products other than room upgrades have expanded greatly.

By telling guests about your offers before they stay with you, you do two important things:

  1. You inform them about options they might otherwise miss
  2. You give them the option to choose add-ons they want at their convenience

Hans Schmidtner, founder and operations manager at UpsellGuru, an innovative upselling solution for hotels, calls this the ‘billboard effect’ of upselling and cross-selling. He highlights that it plays an important role in improving the guest experience, generating great reviews and ensuring repeat business.

Simple and effective

This takes away the stress of having to rattle off an endless list of services and promotions from the front desk and makes check-in more pleasant for guests. Think about it… they just had a long trip and probably want to go to their room to relax and freshen up as quickly as possible.

While they might be happy to reserve a table for tonight’s dinner or take you up on another relevant offer, most of your other packages or services would go unmentioned and unnoticed in this situation. That leads to you losing out on extra revenue and a chance to delight your guests, while your guests miss out on a fantastic experience.

Keep it pain-free

Guests are usually reminded of the money they are spending on a room during check-in, and handing over their credit card for a guarantee can feel almost as painful as buying something.

This means they’ll be less interested in adding further expenses by booking a spa treatment or a limousine transfer. But if you can extend your offer pre-arrival or, if relevant, during the stay, the chance of conversion is much higher.

Encouraging communication throughout the guest journey

Daan de Bruijn, founder and CEO of Bookboost, a direct communication and upsell tool for hotels, explains that it’s time to start seeing the guest journey as a whole. Instead of looking at the booking process, the in-house and the post-stay time as separate, it’s important to view them as a single process and create a suitable communication option for each stage.

For example, this means sending more than just a dusty confirmation email when someone books. Instead, try proactively reaching out to guests with personalised messages and relevant offers. That way you can lower the communication threshold, become more approachable and open the door to guests who have questions and requests.

Shifting towards a relationship-centric approach

Making it easier to get in touch with the hotel throughout the guest journey can make people feel more like they are messaging a friend rather than a business or a corporate entity.

This creates a personal connection, encourages people to share their feedback and leads to more positive word of mouth, de Bruijn elaborates. Pre-arrival upselling and cross-selling via email or SMS can play a big part in this approach. By putting targeted offers in front of guests and letting them decide, hotels adopt a true ‘guest first’ approach. In Schmidtner’s words: “Upselling and cross-selling put the guest in the driver’s seat during all stages of their journey.”

It’s always about making the most of guest data

Sending guests a slew of untargeted offers will likely create two problems:

  1. Low conversion rates because your offers are too generic
  2. Annoyed guests because they feel like you’re selling just for the sake of it, not to enhance their experience (and who can blame them?)

But it doesn’t have to be like that. Loïc Gabriël, sales manager at Oaky, a fully automated pre-arrival upselling platform, puts it best when he says: “A great advantage of upselling is that it gives you a chance to learn more about what your guests value and need during their stay. With this information, you can create unique experiences and truly wow them.”

Wondering how to do that? Enter… guest segmentation!

When applied properly, segmentation based on the guest information stored in the project management system (PMS) is a powerful tool that can help you send guests the offers they want to see (and buy). A solo business traveler, for example, will be more interested in express laundry service than a Champagne welcome in the room. It’ll be the other way around for guests who are on their honeymoon or an anniversary trip.

Now you may be thinking that going through all your reservations manually to decide which deals to pitch to guests would be more hassle than it’s worth. And that’s probably true. That’s why it’s smart to put this task in the hands of automated upselling tools. They can pull PMS data, segment guests, send them highly targeted offers and get a higher conversion rate than front-desk upselling or cross-selling could.

The role of upselling and cross-selling post-Covid-19

With hotels having lost several months of revenue and the rebound being slower than initially expected, it’s important to make the most of every booking.

“We know that occupancy won’t magically go back to pre-crisis levels. The reopening period will probably be slow and painful. That’s why an even bigger focus needs to be put on every single guest staying at your property to maximise average spend and revenue,” says Clément Dénarié, head of sales at Oaky.

Make every interaction count

But it’s not just about generating as much revenue as you can (although that’s certainly important). It’s also about ensuring guests have the best possible experience at your hotel, so they come back in the future, spread positive word of mouth and encourage others to travel too.

“A ‘guests first’ approach is more important now than ever before, and upselling does exactly that. Whether you’re a big branded property or small independent hotel, having an upsell strategy is one of the most powerful ways to increase revenue, to personalise and enhance your guests’ experience. Both these points will be crucial once business picks up after Covid-19,” Schmidtner explains.

Gabriël adds that he expects many travelers will now prefer taking advantage of more onsite services since they trust the hotel’s hygiene measures and want to avoid unnecessary risks.

This gives hoteliers a great chance to wow guests with creative deals and offers. For example, how about thinking of a way to turn in-room-dining into an experience rather than just another TV dinner?

Communicate proactively

Today, hotels have a unique chance to proactively help guests make their stay feel safer and more comfortable. You can do this through information and offers centred around hygiene and physical distancing, and by encouraging communication during and after the booking process.

At first, many people will feel uncertain about travelling.

Showing guests what you are doing to keep them safe and offering them ways to customise their stay in a way that makes them more secure can help them confidently make decisions and plan trips. Using pre-arrival messages, with or without paid offers, will allow you to communicate about onsite safety measures and to keep the door open for any guest who has questions.

Final words of advice from upselling experts

Now, before we wrap this up, here are some final words of upselling advice from the experts.

Schmidtner from UpsellGuru suggests: “Have a strategy on how you can upsell in all stages of the guest journey. Include every step from the booking process, the pre-stay period and the arrival, to the stay and post-stay phases. Staff training and the right technology are key to help hoteliers do that and achieve great results. Both are easy to implement and very profitable.” Dénarié and Gabriël from Oaky emphasize that you should get to know your guests and put yourself in their shoes. Then, go further than just answering their needs – try to surprise and delight them.

They also recommend this: “It’s important for hotels to be ready for when they can reopen. Use this time to evaluate processes and the tech solution you are using. “Create a competitive advantage by piloting new technologies, not only upselling tools but also revenue or operational management solutions. Many companies are offering free trials right now. Why not make use of that offer?”

Finally, de Bruijn from Bookboost advises making upselling all about the guest. “Make them feel like you care about them having the best experience at your hotel. “Make your offer personal and highlight what’s in it for them. When you do this, your upsells won’t be perceived as pushy but as a great way for them to get even more out of their trip.”

Now, it’s your turn! With so much great advice on upselling, what could possibly go wrong if you gave it a try? There’s no need to go crazy here. Start with a popular offer or service you already have at your hotel and begin promoting it more actively to guests before they arrive.

And don’t forget: upselling and cross-selling can look a little different at every hotel. Play around and see what works best for you and your guests. Let me know how it goes!

This article was originally published on Hospitality Copywriting.

Juliana Hahn
Juliana Hahn

Hospitality content creator and copywriter

Juliana Hahn is a content creator and copywriter specialised in writing for the hospitality and tourism industry. Before diving into the world of copywriting several years ago, she studied hotel management and worked in hotels around the globe. Today she leverages her industry experience to craft engaging content for hospitality tech companies, hotels and online publications.

Pin It on Pinterest