Excelling with the upsell requires an analytical approach
Smart upselling today is not only a significant way to garner incremental revenue but it can also play an important role in achieving high customer satisfaction scores.
In order to excel with the upsell, an analytical approach is a must. To this end, hotel companies have embraced real-time intelligence engines that can analyse, predict and actually make offer sets that convert better. EyeforTravel’s Ritesh Gupta talks to Chinmai Sharma, vice president revenue management and distribution at Louvre Hotels Group, about crafting apt upsell offers and the role of analytics.
EFT: What do you make of efforts relating to upsell offers based on analytics?
CS: If you actually want to successfully upsell guests, it’s nearly impossible to avoid an analytical approach to upselling. The industry historically has relied on front desk training and incentives to promote upselling at check-in and the results have obviously not been great. New tools and analytics make this process a lot easier. Take Nor1, for example. They take an automated approach to upselling using a real-time intelligence engine that can analyse, predict and actually make offer sets that convert better. The volume of data and the speed at which this occurs is difficult to manage manually just like in automated RM systems.
At the same time the hotel team needs to understand the analytics and develop the parameters for such tools to operate successfully. And then the hotel must trust and leverage the solution by awarding guest requests, learning from the results, and then to apply the resultant data across the organisation.
This decision analytics approach is going to become more the norm as the industry moves towards making more offers at the point of booking and consumption.
EFT: Where should hotels be looking to deliver better upsell offerings via data management?
CS: In order to improve upsell offerings using data the companies need to identify the key benefits their customers are looking for and then to be able to incorporate them in the selling process in the most seamless way possible. They can do this themselves by investing in technology and resources or use an external partner that specialises in this area.
EFT: How is the industry currently working out upsell offers especially for direct online channel?
CS: As usual the OTAs took the lead in this area by offering better room types and available packages during the online check out process (for eg. pay another $30 for a deluxe room). I still see many hotel companies that don’t offer any upsell options to customers who book the lower room types or packages. Normally this could be a function of the booking engine or CRS capability. An interesting development has been that an increasing number of hotel reservation solution providers have been improving the upsell and promotional capabilities for their clients. Some companies like Travel Tripper, for instance, provide an interesting solution to this problem by upselling room types using an incremental pricing display along with relevant room types or product images, in a simple and easy to understand manner.
EFT: Where else can hotels enhance the guest experience with custom upgrade offers?
CS: Guest engagement shouldn’t end at the point at which they make a booking or check-in. The real opportunity is to become more than just the place where they sleep but to connect with the guests as an experience resource, providing data-driven offers for room upgrades, dining, spa, and even external activities and events that a guest is likely to want and would be willing to pay for. We know what the guest is likely to want because the data tells us what to offer and at what price in order to please the guest and drive incremental revenue.
EFT: What sort of upsell offers can we expect to see going forward?
CS: Today, most upsell offers are centered on premium room inventory but it’s starting to shift with hotels offering more services, activities and features that guests can take advantage of during their stay.
EFT: Is there potential to come up with the right offer for the right guest at the time of check-in, irrespective of the booking channel?
CS: Upselling allows a property to glean incremental revenue on an existing booking, regardless of its origin and to engage that customer for the future.
A guest’s stay experience at a hotel is as individual as they are and that is why making relevant and targeted offers is important. If you want to get someone’s attention then you tell them what they want to hear; show them what they want to buy; anticipate their needs and deliver on their expectations. This is what will drive lasting loyalty for guests who already book with you, and convince guests to book directly with a hotel if they didn’t before. The revenue and loyalty potential to do this in real-time, including using mobile technology, is enormous. And the reality is most hotels can’t do this fast enough, or well enough, on their own. They’ll usually need to partner with specialised companies that have the know-how, the real-time predictive data analysis, to make this happen.
EFT: What factors do you need to consider when trying to upsell to a confirmed guest?
CS: There are many factors that must simultaneously be taken into consideration in determining what a customer would be willing to pay for an upgrade. Things such as length of stay, the number of travelers on the reservation, day of the week, and the original booking value of the reservation are just a few of the critical factors that help create an offer worth paying for.