by Don Urbahn, Vice President Revenue Management, New Castle Hotels & Resorts

Have you ever been pleasantly surprised to find your favorite dessert hiding in the refrigerator following a satisfying and wholesome meal? You know that feeling of delight, even though you’re really not hungry? In the discipline of hotel revenue management, upselling is just like that unexpected dessert. It’s icing on the cake of a solid, satisfying, profitable ADR.

Here are a few ways smart hoteliers can ensure a steady stream of sprinkles and cherries.

At time of reservation:

  • Take the time to understand the potential guest and their reason for travel.
  • Use that information to focus the upsell on the guest’s needs and wants, such as a package, a better view or location.
  • Emphasize the added value to the customer.

For example:

A guest calls to make a reservation for two nights in a downtown hotel. The heads-up reservationist learns that the guest is travelling on government business and is, therefore, eligible for government rates and per diems. She offers the guest a bed and breakfast package that meets the traveler’s need to stay within per diem guidelines but earns the hotel a greater share of his spend.

Remember, if a guest is calling the hotel directly, they’ve more than likely done a fair amount of research on line. They’re looking for the lowest rate possible, so the opportunity for upselling is in creating value for this guest.

Prior to Arrival

Whether you have brand-supplied technology or just a booking engine, you have several opportunities to upsell that cost absolutely nothing to execute.

  • Beginning with the e-mailed confirmation, make a limited time offer, or a wait list opportunity for a better room type, better view or additional amenities.
  • Many systems are able to generate a direct email offering, where you can give guests the chance to book a restaurant reservation, spa treatment, or another amenity. This is a great time to work on capturing more of the guest’s spend.
  • Most of the brands provide an opportunity for travelers in their loyalty programs to check in prior to arrival. This is an opportunity to upsell to that traveler. Those who pre-paid are particularly likely to pay an extra $20 for an upgrade because the trip feels like it’s free when the credit card bill was paid a month ago.

For example: A family books its vacation getaway eight weeks in advance, and chooses the pay-now option to save $20 per night. Prior to arrival, they receive an email offering the opportunity to book a reservation at the hotel’s restaurant. They decide that’s a good idea for the first night when they’ll be tired from traveling. Two nights before they leave, a pre check-in email gives them the opportunity to spread out in a suite for an extra $25 per night. The trip isn’t costing them anything at this stage, because they paid for it a month ago, and $25 per night for a suite sounds like a great deal.

You’ve gained dinner for four an extra $25 per night and the gold star for revenue management.

Remember, even if only five percent of the guests open or take advantage of any upsell offer, it’s found money that cost nothing to unearth.

At Check In

  • This is the final opportunity for the upsell but one that can be leveraged with some strong added value opportunities for the guest. Try offering club level admission or adding in breakfast for an upcharge. If you’ve got a room with a great view that’s still available, make sure the front desk staff is empowered to offer it for a nominal amount. There’s no reason for the best rooms to go empty when you can make a friend on the fly.
  • Always offer a walk-in guest the best room available, not the least expensive room. When someone is grateful to find a place to sleep, they’ll likely grab the first thing offered. You can always negotiate down if you have to.

In All Cases

  • Be sure that all team members are fully trained on room features and benefits and there is strong communication on availability/price flexibility.
  • Empower associates to make deals and make mistakes. Chances are pretty good that someone will only give the suite away once, and what is it REALLY costing anyway?
  • Utilize brand programs and objectives in the upselling process
  • Share the rewards. Make sure you have an incentive program for the team members charged with upselling. Consider a flat dollar amount for each upsell, sharing in the ADR growth or some other objective goal. Communicate it well and celebrate the wins.
  • Remember, even if the guest does not go for the upsell, making the offer alone strengthens the relationship between the hotel and the guest if the offer is well targeted to meet the guest’s needs.
  • Upselling is a matter of staff members building personal relationships with guests, so be sure you hire for personality. You can always teach the technical skills, but you cannot teach a genuine ability to connect with others.