We have time and again reiterated how book direct is the best revenue channel for any luxury hotel.
While you will pay upwards of 15% commission to OTAs and travel operators, you will likely get this figure under 5% if you have a strong book direct strategy.
This is only the starting point for maximising your luxury hotel room revenue.
Upselling is often disregarded or not paid attention to by luxury hoteliers as they focus on driving more customers to their hotels rather than bringing value out of their stay.
While this works in the short term, you can definitely reap more from your book direct strategies in the long run with simple upselling techniques placed carefully on your website and other customer contact channels available to you.
By upselling we simply mean increasing the discretionary spend that a typical customer makes in the hotel after they have checked in.
Many customers are interested in services like taxis to and from the hotel, sight seeing tours around the area, dining options and an upgraded room or an extra room at a discounted price.
You can easily navigate and enable a larger share of what your customer is going to spend during their vacation or stay at your luxury hotel.
This is called increasing the ‘share of wallet’ of your customer, i.e. increasing the spend that a customer makes with a particular brand out of convenience or preference for that brand.
Our research shows that direct booking guests in-stay spend is
2 X
that of tour guests.
There are a few key benefits to upselling within your hotel:
1. Increased Revenue
There is an added revenue to your books outside of the typical room charges.
2. Brand Value
You can improve your brand image and value for your customer by offering them services at their convenience without having to go through the hassle of researching and overspending.
It will elevate the customer experience while creating a strong and emotional brand value.
3. Customer Contacts
When your customers book directly with you, not only do you pay less commission to OTAs but also create value in accessing customer information like emails and phone numbers to contact them with offers before and after their stay.
Hence, more repeat customers.
4. Exclusive offers
You can easily create exclusive offers available through your own website that will not be available on other platforms hence driving more traffic towards direct bookings.
An effective upselling strategy will definitely give you access to higher revenue streams while minimising loss, but the success of upselling techniques is dependent on many factors.
Consider what is the product that you are offering, how you position the product and when you do so. Ultimately it is critical to know that your customer is not only satisfied but delighted and really connected with your brand.
Selecting the right digital and technology partner, like Aró, can give you access to more direct customers who are likely to have a higher share of wallet at your property during their stay.