Mastering Hospitality Ancillary Revenue
MASTERING HOSPITALITY
ANCILLARY REVENUE
Proven tactics for ancillary revenue growth in hotels, bars, restaurants & Spas
Understanding Ancillary Revenue
Ancillary revenue is a critical income stream for hotels beyond room bookings, such as F&B, spa services, and event hosting. Learn about the importance of ancillary revenue in diversifying income, and enhancing the guest experience. Learn how optimizing these streams can increase guest satisfaction while boosting profitability by up to 50% in some properties. Key factors like personalized service, guest interaction, and strategic upselling are explored to help hoteliers tap into untapped revenue potential.
Identifying potential Ancillary Revenue streams
Explore the many opportunities to increase revenue through ancillary services. From traditional offerings to emerging trends such as wellness programs and technology-driven services, the options are vast. Discover how partnerships with local businesses to offer unique experiences drive guest satisfaction. Understanding guest preferences and staying adaptable to market trends will allow hoteliers to maximize these streams efficiently.
Leveraging technology to maximize Ancillary Revenue
The integration of technology into hospitality operations has transformed how properties can generate ancillary revenue. From AI-driven personalization to mobile apps for bookings and services, technology helps streamline guest experiences and increase revenue. Dive into tools like data analytics, mobile apps, and smart room controls to enhance upselling and cross-selling opportunities. By adopting cutting-edge technology, businesses can offer hyper-personalized guest experiences that increase both satisfaction and profits.
Guest-centric strategies to maximize Ancillary Revenue
Focusing on the guest experience is essential for increasing ancillary revenue. Get to know more about personalized service, loyalty programs, and the importance of guest feedback. Using guest data, hotels can segment their audience and tailor their services to meet specific needs. Whether through suggestive selling at check-in or personalized packages, guest-centric strategies not only improve satisfaction but also drive higher revenue from additional services.
Learn from the best
Top Contributors
Learn from the tips and insights shared by some of the top experts on ancillary revenue management from Hotels, Airlines, Spa, Restaurants and Trave Technology.
Fernando Vives
Chief Commercial Officer
Minor Hotels
Fernando illustrates how improving guest experiences through technology-driven upselling has resulted in better reviews and higher revenue, proving the impact of emotional connections on revenue growth.
Pere Estela
Global Ancillary Director Iberostar Group
Pere shares his extensive experience with ancillary services in hotels, advocating for the adoption of TotalRevPAR. By engaging guests from pre-arrival to departure, hoteliers can capture more in-destination spending, driving a significant increase in overall revenue .
Nadine Meichsner
senior manager corporate strategy
lufthansa group
Nadine discusses how airlines, particularly low-cost carriers, have mastered the art of "unbundling" services, generating up to 50% of revenue from ancillary sources like checked baggage fees, seat selection, and inflight services. Hotels can adopt these strategies to enhance guest experiences and significantly increase profitability through similar unbundled offerings.
Lucía Peris
spa & wellness consultant
A well-managed spa department not only elevates guest experiences but also generates substantial revenue. Lucía emphasizes the diversification of wellness services, loyalty programs, and retail product sales as powerful drivers of both guest loyalty and profitability.
Erik Tengen
co-founder & ceo
oaky
Oaky revolutionized the guest upselling experience by integrating emotional connections with advanced technology, driving significant increases in TrevPAR and guest satisfaction. Oaky’s data-driven approach personalizes offers while simplifying hotel operations, proving that emotional touchpoints are key to boosting ancillary revenue.
Fermín Carmona
co-founder & ceo
Hotelverse
By pioneering room number selection and attribute-based selling, Hotelverse enables hotels to offer hyper-personalized stays. This approach not only enhances the guest experience but also leads to significant additional revenue, with room selection fees and dynamic pricing proving particularly impactful.
Alessio di Gaetano
co-founder & chief revenue officer
dynameat
Alessio shares his expertise on dynamic pricing in food and beverage services. By adjusting prices based on demand and optimizing menu configurations, restaurants have boosted profitability by 15%. His AI-driven platform DynamEat is helping leading hotel brands implement dynamic pricing, driving additional revenue while reducing waste.
Benjamin Devisme
vp sales
quicktext
Benjamin highlights the future of guest communication through AI-powered messaging tools like Quicktext. He emphasizes the importance of using real-time data to optimize guest interactions, upsell services, and improve operational efficiency. Hotels using AI-driven communication have reported increased guest engagement and higher conversion rates for ancillary services.
PRACTICAL GUIDEBOOK
Over 100 practical cases and real life examples
Includes 100+ examples, ideas and tools to help you increase your ancillary revenue while elevating your customer experience.
Marketing and promoting Ancillary Services
Effective marketing is the key to promoting ancillary services and ensuring their success. From digital marketing strategies, including SEO, to social media, and email campaigns. By using personalized offers and targeting specific guest segments, hospitality businesses can drive awareness and bookings for ancillary services. In-room marketing and collaborations with local businesses further enhance the range of services offered, ensuring guests are engaged and revenue opportunities are maximized.
Training and empowering staff to maximize Ancillary Revenue
Well-trained and empowered staff are the backbone of a successful ancillary revenue strategy. Focus on equipping employees with the skills and confidence to upsell services effectively. Practical tips include comprehensive product knowledge, role-playing scenarios, and performance incentives to motivate staff. By fostering a culture of service excellence and empowerment, hotels can ensure their teams go above and beyond to enhance guest experiences, driving both satisfaction and revenue.
Airlines and Cruise Lines: Leading the way in Ancillary Revenue
Airlines and cruise lines have long mastered the art of generating ancillary revenue through innovative strategies like à la carte services, loyalty programs, and technology-driven upselling. Learn how hospitality businesses can learn from these sectors. Key insights include the importance of dynamic pricing, mobile apps for service bookings, and partnerships for bundled experiences. Examples from companies like Ryanair and Royal Caribbean demonstrate the immense potential of ancillary services to drive profits in the hospitality industry.
Ancillary Revenue in Restaurants and Bars
Restaurants and bars offer untapped potential for increasing ancillary revenue. Learn strategies for upselling and cross-selling premium items, seasonal specials, and exclusive experiences are covered. Effective marketing, staff training on upselling techniques, and leveraging technology to streamline orders can significantly boost revenue. Case studies from successful F&B operations illustrate how enhancing the dining experience leads to increased guest spending and long-term profitability.
Measuring and optimizing Ancillary Revenue
Accurately measuring ancillary revenue is critical for long-term success. Key performance indicators (KPIs) like RevPAG (Revenue Per Available Guest) and conversion rates are discussed to track and improve revenue streams. Optimization strategies include benchmarking performance, analyzing trends, and using guest data to personalize offerings. Regular reviews and actionable insights help hotels continuously innovate and enhance their ancillary services for maximum profitability.
Future trends and opportunities in Ancillary Revenue
The hospitality industry is rapidly evolving, with new trends emerging in technology, sustainability, and guest preferences. This chapter explores the future of ancillary revenue, focusing on innovations like mobile check-ins, digital concierge services, and personalized guest experiences. Businesses are encouraged to adapt to changes by offering new services, flexible booking options, and embracing AI-driven marketing to stay ahead of the curve and capture emerging revenue opportunities.
About the author
Pablo Torres
Pablo Torres is a hospitality professional passionate about sharing knowledge.
Born and raised in Spain, Pablo has developed most of his career internationally, spending over a decade in London (UK).He holds a degree in Tourism from the University of Salamanca and furthered his education with a Certificate in Revenue Management from Cornell University, postgraduate studies in Revenue Management from Universidad de Alicante and TEDUKA (Spain) as well as an Executive MBA from IE Business School.In addition to his work as a Hospitality Consultant, Pablo frequently collaborates with educational institutions such as the University of Alicante, UNIR, and Barcelona Executive Business School (Spain). He has delivered over 10,000 hours of consulting and training to more than 4,000 professionals across 30 countries worldwide.Pablo is a LinkedIn Top Voice globally and has been repeatedly recognized as one of the top 25 social media influencers in the hospitality industry (IHI), and one of the Top 50 most inspirational professionals in the industry.He has published hundreds of articles online and is regularly invited to events to share his insights on the industry. Pablo is also an experienced speaker, having addressed audiences in the UK, Colombia, Portugal, and Spain.
© 2024 Pablo Torres. All rights reserved.