The importance of upselling in hotels: Top 6 compelling benefits

Upselling is a common tactic used in hotels to encourage guests to spend more during their stay. While its main goal is to boost hotel revenue, it also plays a significant role in improving the guest experience.

By offering a range of amenities, services, and room choices, a well-planned upselling strategy helps guests make the most of what your hotel has to offer.

Dive deeper into the benefits of upselling for your hotel and explore upselling examples to get inspired.

Why is hotel upselling important?

1. Increase average guest spending

Smart and personalised upselling can encourage guests to spend more. Research shows that nurturing your existing customers is five times more cost-effective than winning over new ones. So, instead of spending on advertising to acquire new customers, it’s essential to focus on upselling to guests who've already booked.

The effectiveness of upselling is evident, with data revealing that hotels employing automated upselling techniques generate an average of €75-250 per guest in ancillary revenue. Depending on a property's upsell potential, it's possible to grow its ancillary revenue tenfold or even 100-fold.

2. Let your guests explore additional services and property amenities

One of the issues that hoteliers have to deal with is communicating the versatility of add-ons, services and available amenities and facilities a hotel has to offer. This constrains a hotel’s ability to deliver more than just a room. An upselling strategy empowers you to go beyond merely selling rooms, incentivising your staff to present a range of additional offers while making your guests aware of what else they can enjoy.

3. Increase guest satisfaction

Today, people are used to customised experiences from online shopping, social media and data-driven advertising. They expect the same level of personalisation from hotels. It means you must sell upgrades or add-ons that match their needs and desires.

With automated upselling, you can improve the level of personalisation by presenting only the relevant offers to your target guests. By creating hyper-personalised deal selections with the help of segmentation, you can improve their experience drastically.

4. Learn more about your ideal guest

Upselling helps build a connection with your guests. If you use upselling software like Oaky, in addition to your PMS or RMS, you can access rich guest data to analyse the most appealing offers. This helps you to explore your guests’ interests and learn more about the experiences they seek and are willing to pay extra for.

You'll also discover what's less popular among travellers. This allows you to revamp offers and make them more attractive or shelve them.

5. Strengthen your brand reputation to stand out from the crowd

Using upselling to delight guests can result in more excellent reviews. This strengthens your brand image and shows that you live up to your promise of providing an amazing stay.

Upsell offers can also be a powerful tool to communicate your brand values. For instance, Grand Hotel De Draak highlights its commitment to sustainability through the Hotels for Trees deal. This eco-friendly initiative, developed by Oaky and Hotels for Trees, invites guests to opt out of housekeeping in exchange for planting a tree. As a result, Grand Hotel De Draak has planted 2,653 trees in two years’ time (of which 2,098 were planted in 2023 alone).

6. Improve departmental cross-collaboration

Since setting up and realising a successful upselling process involves many departments, it’s fair to say that upselling brings teams together. From front desk, F&B and spa departments to revenue managers and general hotel managers, teams have to work together to make sure the upselling strategy reaches its targets of increasing ROI and improving guest satisfaction.

8 Simple hotel upselling examples and ideas

Now, it's time for inspiration. Let’s look at some tried-and-tested examples of hotel upselling.

1. Paid room upgrades

The classic upsell, paid room upgrades mean offering guests a higher room category for the corresponding supplement charge. You can either charge the full room type supplement or offer a discount to make the deal more attractive. To boost revenue from paid upgrades, use a dynamic pricing strategy to adjust rates based on demand and availability. The benefit of selling upgrades at the pre-stay stage is not just the added revenue but also the chance to resell base category rooms.

2. Early check-in and late check-out

Early check-in and late check-out deals are the basic upsell offers that can yield impressive contributions to your revenue. These always attract guests, as they offer flexibility and extra convenience. If you cater to business travellers specifically, adding these deals to your arsenal can be a game changer.

If you use an RMS (revenue management software), you can also price these deals dynamically depending on the occupancy and room availability. According to our data, dynamically priced early check-in and late check-out deals can bring 35% more revenue compared to static pricing.

3. Food and beverage deals

Upselling can increase your F&B venues’ capture rate. Start with basics like promoting standard breakfast, lunch and dinner options. Make things more interesting with exclusive menus at your signature restaurant or create packages at advantageous rates. You could even put together an F&B experience where guests dine in a special location, interact with the chef or participate in the preparation.

4. Spa and wellness services

Spa services are ideal for upselling because they add value to a guest’s stay. Begin with straightforward offers, such as one long signature treatment and a few shorter options.

Then, think of which spa treatments you could combine into packages for guests who want to splurge and pamper themselves. Finally, look at options to combine a spa session with offers from another department, e.g. F&B.

5. In-room extras

Little extras in the room can make a big difference. What would your guests like to find on arrival? Perhaps a fruit platter, a premium minibar set-up, a romantic amenity or a birthday cake? Options here are almost endless, so segment your guests and pitch only relevant extras.

6. Activities

While offering activities can mean extra effort, it’s an excellent way to engage guests and make their stay more memorable. Health and wellness deals, like workout sessions and yoga lessons, often do well. Locally themed activities, such as cooking classes, surfing lessons or guided tours, can also work, depending on your target market. Consider working with a local partner, e.g. a guide or fitness instructor, if you don’t have all the needed talent in-house.

7. Stay extension deals

Encourage your guests to extend their stay with discounts. This is an effective way to sell additional rooms for low-occupancy shoulder dates. Target people travelling by car as they’re not restricted by train or plane tickets.

8. Housekeeping

With many hotels struggling to keep up due to staffing shortages, opt-in and opt-out housekeeping models are becoming more common. Apart from saving you labour and equipment costs, these deals also allow your property to run more sustainably. Frame your offer this way, and you’ll see more eco-conscious guests taking advantage of this offer.

How to start upselling at your hotel

1. Work with your entire team

Upselling is a team effort. Get your team on board and hear their thoughts on what would make the best deals for your guests. Next, discuss how practical implementation could look, evaluate costs and determine a fair price point. Follow this upsell meeting agenda to make sure you cover all the relevant points.

If you still want to work with on-arrival upselling, train your front office staff on the best practices and upselling techniques. Finally, think of a way to share your success with your team. This could be a commission from the upselling revenue or another benefit they value.

2. Choose the right time for upselling

Timing is everything in upselling. Get the right offer in front of the right guest at the optimal time, and your conversion rates will skyrocket. Contrary to popular opinion, on-arrival upselling is not the best option.

During check-in, guests are often tired from their trip and don’t want to hear about all your offers. On top of that, receptionists don’t have the time or opportunity to upsell during every check-in.

Instead, send travellers a selection of deals well before they check in. Oaky’s data shows that one email sent twelve days before arrival followed by a second one a few days later yields the best results. In that case, average click-through rates reach 48%, and conversion rates average 12%.

This also primes guests for more upselling at the reception because they already know your offers. A gentle nudge from the front desk agent can get them to book the spa treatment they already had their eye on.

3. Suggest multiple upselling deals (but not too many)

A small yet targeted selection of deals works best. If there are too few deals, guests might not find one they want. If there are too many, travellers may feel overwhelmed and lose interest.

Start with a handful of the classics such as a breakfast add-on, early check-in and late check-out. Then add a few deals that are relevant specifically to the recipient. In the end, that should bring you to around 10-15 offers. That’s still manageable for guests and increases the chances that they find something they like.

4. Use hotel upsell software for the best results

As you can see, a lot of work goes into upselling if you want to do it right and get amazing results. The good news is that dedicated hotel upsell software can automate most of these tasks. That streamlines the process for everyone, including your staff and guests.

Oaky supports you every step of the way. The extensive deal library comes with over 80 creative and high-performing deal suggestions you can use at your hotel. Once you’re ready to send offers, Oaky pulls data from your property management system to personalise the deal selection for each guest.

Next, the platform sends pre-arrival upselling messages at the optimal time. This way, travellers can browse your offers at their leisure and book whenever they feel like it. Finally, the system automatically adds the guest’s deals to their profile and invoice. All that’s left for you is to get things ready and create the perfect stay experience your guests dreamed of.

Now you know pretty much everything about the importance of upselling in hotels: how it can delight your guests, drive revenue, and even boost your reputation.

And with the right tool, you can see all these benefits without having to add even more tasks to your to-do list.

Final thoughts

Perfecting the skills of upselling goes beyond increasing revenue.

It's a strategic approach to elevate guest experiences and build a standout brand. Whether you're encouraging guests to upgrade to a more spacious room, book an airport transfer, or participate in exciting walking tours, the essence of providing versatile upsell opportunities should aim to make guests' stays more comfortable and memorable.

With hotel upselling software up your sleeve, you can ensure the personalisation of your upsell offers, delighting guests and boosting your ROI at the same time.