Finding information about how and what to upsell is easy. Details about real-world results and figures are much harder to come by.
But they are important if you want to answer this key question: Is upselling actually worth it?
Companies providing upselling platforms would like you to believe so. But why not check the facts and figures yourself, instead of just taking their word for it?
Average upsell performance revealed in the free benchmark report
By collecting and examining upsell data from 1,100 hotels from 2017 to 2019, the upselling platform Oaky’s analysts created a free benchmark report which sheds light on how much revenue hotels can expect to generate every month.
The report shows which hotel categories perform best, how much every upsell email makes on average, how high the average incremental revenue is per room and what the extra spend is per guest.
Read on for an overview!
Average incremental revenue per room
According to the report, a property’s location and type strongly impact additional revenue per room. Mountain and ski resorts came in first place with an average of €38.39 of upsell revenue per room every month. Other leading property types were luxury hotels, golf and spa resorts.
Airport hotels stood out with a rather low performance which is probably due to their high volume of group and crew business who are not the prime audience for upselling. But this needn’t discourage you because the top performer mentioned in the report was, in fact, an airport hotel. This proves that you can make upselling work at any type of property because there will always be guests interested in ways to customize their stay. Accurate segmentation and targeted relevant offers are the keys to reaching them and making the sale.
Average additional spend per guest
High-end resorts and luxury hotels had the highest overall extra spend per guest, which is not a surprise given their affluent clientele. Serviced apartments, city hotels, and branded properties also did well in this category, which is probably because they attract a lot of business guests who are willing to pay for add-on amenities and services to make their stay more efficient and enjoyable. Every guest who opts for one of your upsell offers creates a win-win situation since they will not only spend more at your property but also enjoy their stay more.
The report also showed a strong performance among hostels. Even though the absolute value of additional spend per guest is lower than in upscale properties, even guests in the budget segment frequently spend a full room night’s worth of money on add-ons they want or need.
Average revenue per email sent
The last metric discussed in the report looks at how much revenue each upsell email generates on average. Luxury and upscale hotels and resorts took the lead again, but that doesn’t mean other properties didn’t do well. Since large branded hotels, city hotels and serviced apartment properties send out a higher volume of emails, they can compensate for the lower average revenue per email.
When you are just starting your upselling journey, knowing the kind of ROI you can expect is very useful, but keep in mind that many factors play into your success apart from just your property’s type and location. Promoting original, attractive deals your guests can’t resist is equally important. For example, a hostel highlighted in the report generated an impressive €6,310 in October 2018 thanks to their irresistible offers.
For more facts, figures and details about how much upsell revenue your hotel could bring in via automated upselling, get the free benchmark report now!
This article is sponsored by our partner Oaky.