Question for Our Revenue Management Expert Panel:

With rising trends of staycations & workcations, is there a greater appetite amongst guests for upselling (e.g., room upgrades) post-pandemic to maintain physical distancing or to “treat” themselves?

Industry Expert Panel

Our Industry Expert Panel exists out of professionals within the hospitality & travel Industry. They have comprehensive and detailed knowledge, experience in practice or management and are forward-thinking. They are answering questions about the state of the industry. They share their insights on topics like revenue management, marketing, operations, technology and discuss the latest trends.

Patrick Wimble
Patrick WimbleManaging Director, Lightbulb Consulting

“I think there are opportunities to upsell but as with any upsell programme, it shouldn’t feel like selling. The danger is that we offer an attractive lead-in price that hooks guests but leaves them feeling robbed because they have to pay for everything once they’ve arrived. If this truly is a better “home from home” then getting the basics should be as easy as if the guests were at home.

You could offer enhanced packages depending on what’s important to your likely workcation guests, but it does require an in-depth knowledge of what your guests are looking for. For example, the Barbados announcement of their year-long “work from home” visa. This spoke to wealthy travellers who could work from anywhere and therefore choose to “workcation” in paradise versus their homes in the U.S.”

Theresa Prins
Theresa PrinsFounder, Revenue Resolutions

“Being more focused on South Africa and Africa, I can confirm that we have already observed the more affluent traveller treating themselves to upselling opportunities and this will continue while there are special deals available for the local travellers.

Where we do not see this same behaviour (and I am doubtful that we will see this in the future) is staycations amongst the average traveller as that was hit harder with reduced disposable incomes. Although these travellers have a high need to treat themselves, they will continue to hunt for bargains and seek value for money. Depending on the type of property, this creates a split in the domestic segment and can be ideal to boost revenue.”

Christoph Hütter
Christoph HütterRevenue Strategy Consultant, Christoph Hütter Revenue Management

“Upsell revenue is the only revenue stream that has remained pretty stable, even if overall room revenue has decreased of course. Hotels have become much better about upselling in recent years and the same goes for the technology used in upselling, e.g., via pre-arrival campaigns.

That said, I still see a lot of untapped potential when it comes to upselling. New products like staycation or workcation are no exception and offer an upselling opportunity. However, I would stay far away from using upselling as a way to promote physical distancing. Health and safety should be a standard and not be offered at a supplement.”

Heiko Rieder
Heiko RiederVice President Revenue Management and Reservations, Penta Hotels

“I believe the pandemic has brought additional currencies to the selection process of a hotel. Aside from value for money and review scores that have always been there, CSO initiatives and a brand’s culture have already increased the amount of measures hotels have to focus on to attract business It has certainly become important for travellers to feel safe and that the relevant measures are in place.

We have tested an upselling scheme around higher hygiene and social distancing quality without success. I personally believe that our travellers will take it for granted that higher than pre-pandemic standards are in place, choose the hotels accordingly and will be willing to pay a higher price as well. However, I don’t believe in upselling to safer or cleaner bedrooms. There is a certain quality that hotels should always deliver and not make it exclusively available at an additional charge.”

Kevin Paateyl
Kevin PaateylCorporate Director of Revenue, Everwood Hospitality Partners

“While many hotels have started offering staycation and workcation packages, the results are not the same. Both packages, like standard packages, work best for some markets and particular types of properties. Resorts destination hotels will continue to rely on domestic staycation packages as a tool to fill gaps in their seasons. We will see fewer discounts and a lot more value. The lockdowns and restrictions brought on by the pandemic have given everyone more time to appreciate their towns and surrounding areas. More and more locals want to experience and learn what their city has to offer. Guests will highly embrace specially curated packages built around local talent, activities, and products.

The success of the workcation package depends a lot on the long-term changes to the corporate work culture. If corporates continue to downsize their real estate footprint and find ways to improve and incentivise a work-from-home culture, the workcation packages may find a stable footing to continue to grow. This could lead to several rooms being redesigned to create a work environment that meets the individual’s needs and boosts productivity.”

Karin van Rhee
Karin van RheeLecturer, Hotel Management School Maastricht

“The traditional way of upselling a higher room category (e.g., because the room is 1m2 larger and offers a bathrobe and a fruit bowl) are no longer doing the trick. Even in Covid-19 times! However, I strongly believe in upselling and cross-selling, in light of a hassle-free, connected stay. Think about including a taxi ride, booking a restaurant, an excursion, bike rental, or even book/offer a coworking place. These are all great ways to offer an extra service and add value for the guest. They take away a pain point from the guest in having to organise this themselves and are helping hotels to drive additional revenues.

Upselling and cross-selling is not just a task for the reception desk but should be embedded and automated in the acquisition journey. By looking at the booking options available on the two biggest OTA’s, next to booking a room, it’s very clear that if hotels do not pick up on this pain point that customers currently have, someone else will take that space ‘again’ for us!”

Pablo Torres
Pablo TorresHotel Consultant, TSA Solutions

“We have seen a high increase in the booking of vacation rentals (Airbnb and the like) precisely to stay away from big crowds. Once the pandemic restrictions ease down, more and more people will feel more comfortable going back to hotels. If we focus on the workcation, that can happen in an apartment, rental home, etc., so how about offering guests to fill their fridge before they arrive? Or perhaps organise in-room dining from a nearby restaurant?

Focusing on the staycations, it’s all about making them feel pampered so that even if they are not far from home, they feel like a thousand miles away. There are great tools on the market (e.g., Oaky, UpsellGuru) for pre-arrival offerings of great extras for their stay.

Once onsite, it’s all down to the human touch to engage with them and work on suggestive sales that can improve their stay, from a massage to a romantic meal in a private dining area. If the hotel does not offer those services, it must work with nearby providers that can offer that service to guests.

Generally speaking, hotels must now do a deep exercise of reviewing their inventory and offerings, as there is so much that can be done about maximizing ancillary revenue. Doing that does not mean reinventing the wheel. It’s as simple as offering virtual rooms at the desk that have special features (so that there’s no need to change them on the PMS) or offering services from trusted local providers (working on commission-based deals, like the above mentioned example of in-room dining from a nearby restaurant).”

Edyta Walczak
Edyta WalczakCluster Revenue Manager, Arora Hotels

“Based on web searches and research, the appetite to travel is increasing. Though this isn’t yet reflected in the actual bookings, it’s an optimistic sign for the hospitality industry. We can all clearly see a shift in customers’ behaviour, hence hotel offerings need to adapt. It will be about learning and experimenting. People will travel more locally; they will look for an escape and treat themselves. Therefore, we will try out different offers and packages.

Now, more than ever, customers are looking for leisure facilities, great breakfast, SPA access etc. It gives hotels a great opportunity to upsell and cross-sell, by offering bespoke packages and offers that combine a selection of attributes. It presents a great opportunity for incremental revenue but also allows the property to stand out in a very competitive market.”