How to Increase Hotel Revenue: 12 Effective Strategies

Increasing revenue is the primary goal of every business, and accommodation providers are no exception. But what actions can and should a property take to increase its revenue? In my opinion, the initial steps are straightforward.

Make Up-selling and Cross-selling a core part of your procedures

Up-selling and cross-selling are two activities that can increase revenue quickly and without major investment for any property. Speaking with a colleague a few days ago, we discussed how confusing these terms can be and how often one is mistaken for the other. Upselling consists of offering a guest making a purchase a better version of what they are buying, ultimately at a higher value. In this case, it means proposing the purchase of a higher room category with more amenities. Cross-selling, on the other hand, consists of proposing a complementary product or service , such as breakfast in the room, spa access, express check-in or late check-out, etc. The best time to propose up-selling or cross-selling services is when the guest is booking on your website, but you can also offer them later.

Train staff to sell more

To increase revenue at your property, it is important to train your staff to sell better and sell more. Related to the previous point, you can encourage your staff to offer up-selling or cross-selling services regularly, especially when they are personalised for the guest. You can also train them to obtain more positive responses to their booking proposals, whether online or verbally over the phone. For example, you can teach them how to write personalised proposals, send follow-up messages to prospective guests or tailor offers to callers.

Train the sales team

While third-party platforms can attract new guests, hotels still rely heavily on word of mouth. For this reason, a qualified sales team is important to the ongoing success of any property. A strong sales team helps hotels increase direct bookings and the number of repeat guests. In addition, it can significantly reduce the commissions paid to third-party platforms. Hospitality businesses should invest in staff training. For example, sales professionals must learn closing techniques and have in-depth knowledge of the hotel's unique selling points. Training a sales team to negotiate with prospective clients can also increase revenue. This enables sales team members to offer specialised packages that can help close deals. Team members must also understand the hotel's target market and apply the relevant sales techniques.

Use dynamic pricing

Another method of increasing your revenue in a short period of time is, specifically, revenue management through the application of dynamic pricing. Unlike a fixed rate list, dynamic pricing allows you to respond to changes in room demand in real time and maximise your revenue. Thanks to dynamic pricing, you can increase occupancy when demand is low while maximising revenue when you see sudden spikes in demand.

Collaborate with local partners

Businesses and professionals in your local area, as well as private individuals, can offer unexpected revenue opportunities, especially during the low season. You can create partnerships with businesses and make your rooms available to their clients, or rent out your space for corporate events such as dinners or conferences. For private individuals, on the other hand, you can propose tailor-made offers that do not necessarily include an overnight stay, but only the use of services such as the spa or restaurant.

Make direct online booking easy

Make sure your property's website is easy to navigate and highly intuitive for people who want to book a room. Also ensure that you integrate a good booking engine that can capture bookings and help you reduce your reliance on OTAs. The absence of an on-site booking system, combined with slow and difficult navigation, can discourage many prospective guests interested in staying with you. To prevent this from happening and losing bookings in the future, hire a reputable professional or web agency that can update your website.

Increase positive reviews

The more positive reviews you collect, the more you can afford to increase your room rates. Not only that: in addition to delighting your guests and encouraging them to leave a review, it is important to respond to those you receive, both positive and negative. Other prospective guests will see your response to dissatisfied guests as an indicator of your team's overall performance and attitude.

Create packages and promotions

Packages and promotions are a classic and effective way to increase your hotel's revenue. To make them genuinely useful for your goals, it is important that packages and promotions are tailored to the needs of your prospective guests. Find out what your guests genuinely enjoy and create packages designed specifically for them. The more personalised packages and promotions you can offer, the more likely you are to sell them.

Be flexible with terms and conditions

Travellers love being able to book stays with flexible terms that allow them to cancel their holiday or change their dates without obstacles. This need has become even more pronounced since the outbreak of the Covid pandemic and the resulting restrictions on travel to different countries. Therefore, try to offer your guests flexible cancellation and amendment terms , while balancing them with your operational needs. The more flexibility you can offer, the less risk falls on guests and the more likely they are to book your property.

Attract younger guests

Millennials and Generation Z are rapidly becoming the largest cohort of travellers. These younger guests require an environment that supports remote work, as well as a place where they can relax and rejuvenate. Successful properties are responding to the wants and demands of these consumers. For example, younger travellers expect seamless, flexible experiences through digital tools. What was once considered an exceptional experience is now becoming an industry standard. Responding to the needs of this demographic benefits the hospitality sector. The industry is experiencing a serious staffing shortage. Technology gives hotels the ability to meet their guests' highest expectations with fewer resources.

Adopt sustainable practices

Hotel properties must also adapt to their guests' requirements and expectations as they move towards a more eco-friendly lifestyle. Businesses in the sector have several opportunities within reach to reduce consumption and promote sustainable practices. For example, many invest in renewable energy sources such as solar panels. Others reduce waste by offering paperless services only or asking guests to save water. Hotels should also promote their sustainability commitments and share their progress with guests. For example, by selecting sustainable products for amenity kits or eco-friendly products for the hotel restaurant. Making the necessary changes to become an eco-friendly property may initially be costly, but most solutions will deliver a return through increased bookings and higher levels of guest satisfaction.

Diversify marketing strategies

The overwhelming level of competition in the hotel marketing sector is a challenge. It is becoming increasingly difficult to stand out from the competition and secure more bookings, especially with the growing popularity of websites such as Airbnb or Booking at their peak. Hotel marketing professionals are well acquainted with these challenges, yet they still have to meet, and ideally exceed, their targets, which are frequently based on bookings. Hotels must stay ahead by investing in digital marketing. This includes campaigns on social media or platforms such as Instagram and TikTok. Hotels can also leverage remarketing strategies to reach former guests or guests with incomplete booking journeys. Email and text-message campaigns are effective ways to convert them into customers.

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