Customer satisfaction has always played an integral role in the success of any business, but none more than those within service-based industries. The success of any hotel hinges on its ability to curate memorable guest experiences and lasting customer satisfaction. Customer relationship management (CRM) software was designed specifically to help support and achieve such guest satisfaction goals.

CRM started out as a simple and manual accumulation of single sources of guest history information. Fast forward to today and it has evolved to collate and analyze multifaceted secondary data available on multiple channels. A modern CRM consolidates valuable guest data, such as transaction data, bookings, stay history, email open rates, etc. into one easy-to-access centralized location. Armed with such information a sales team can collaborate with marketing to deliver targeted and useful content to prospects and returning guests. In short, a CRM complements a hotels current sales practices and allows selling to be a more personalized experience that’s focused on the customer.

With that in mind, most hotels made the natural conclusion that the CRM can support and drive upsell activities. From appearances, it makes sense. The strength of a CRM solution is its ability to amass a wealth of guest intelligence and use it to create relationships with guests. So, when it comes to upselling, a CRM does an excellent job of communicating with guests’ pre-stay, on-property and post-stay. Emails, logically, can include offers to upsell to higher categories of rooms and amenities. But, alas, the upselling journey stops here.

The CRM: Not an operational or revenue management tool

CRM addresses a marketing and sales problem, but it doesn’t tackle the most difficult challenges in hotels: operations and revenue management. Here’s why it falls short.

  • CRM upselling tends to be one-way. The CRM is more of marketing tool that makes offer visible to guests, but it cannot guarantee or fulfil an upgrade until the day of arrival. It also requires a set of manual activities or data inputs by the front desk to ensure the offer is actually actioned and, that the guest receives the offer they originally accepted.
  • Similarly, upgrade offer prices are not reflective of demand. As the CRM does not leverage revenue management, it cannot offer dynamic priced upgrades, and instead rooms are offered at a flat fee. Not only is a flat fee blind to current demand but it does not align with your customer’s price point. If they do not feel like they are being offered a lucrative deal or some sort of bargain, they are less like to convert and purchase.

In short, the CRM is limited by its original purpose and cannot do what an automated upsell tool can achieve.

Automated Upselling: Solving operational or revenue management problems

When it comes to upselling successfully, the problem isn’t just that you need an enticing offer, it’s that you need to be able to guarantee pre-arrival upsell transactions (at the time of the offer presentation) at a price that reflects demand. That require two very complicated algorithms:

  • True Availability – If you ask a hotel if a room is available two weeks from today, they can tell you that it is available, and you can reserve it. However, if you ask the same hotel if you can check in early to that hotel room, or if you want a room that is close to the elevator, or any other similar questions, you start to run into the concept of operational availability. Hotel assign rooms close to or on day of arrival so they can get a better understanding of what is happening operationally in the hotel itself. People extend stay, check out late, housekeepers call in sick, and sometimes they actually oversell their occupancy. To make specific kinds of promises about rooms in advance requires a complicated algorithm to pull and weigh multiple data points that will derive the true operational availability of a room on a date range. CRMs simply do not calculate that because it is far outside their core feature set. However, advanced automated upselling solutions CAN do that.
  • Dynamic Pricing – Revenue managers invest a lot of time (and technology) into yielding their room prices to stay ahead in their compset. Demand for rooms – and thus room prices – change because of market occupancy changes and evolving demand generators (concerts, conventions, sporting events, etc.). When a hotel upsells to an acquired guest, they often simply have a flat price for the upsell (or even simply give it away for free). The problem is that room upgrades are still room inventory and the value of that inventory changes based on the same demand factors that drive the original room prices variances. Upselling also provides additional data that need to be considered, such as what the guest paid originally, whether the upgrade is predicted to be a close match to the guest’s preferences, and additional yielding the hotel may consider for upselling scenarios. Once again, CRMs do not calculate such dynamic pricing, but advanced automated upselling solutions are in the business to do just that.

In summary, CRMs are excellent at doing what they were intended to do. But upselling optimization isn’t about a sexier offer being emailed to a guest. It’s about immediate satisfaction for your guests, less administrative work for your hotel staff, consistent revenue from optimized pricing that is yielded to reflect demand.

Don’t accept that your CRM can do everything and settle for “upselling light.” Employ a real automated upselling solution in coordination with your CRM and drive real revenue and cost efficiencies.

About ROOMDEX, INC

ROOMDEX is the technology leader in the hotel upselling software space. Its hotel upsell software automates, monetizes and ultimately simplifies the hotel room upgrade process by putting the power of choice in the hotel guest's hands.

ROOMDEX Upsell Automation uses hotel reservation, guest data and its proprietary True AvailabilityTM and Dynamic Pricing algorithms to deliver personalized digital offers, greatly enhancing the guest experience. The hotel upsell tool relieves hoteliers of the labor time required by other upselling solutions while delivering high margin revenue and a substantial ROI.

ROOMDEX is now the exclusive provider of ABS Upselling. Attribute-based selling re-imagines hotel inventory merchandising, delivering a unique and improved guest satisfaction and increased hotel revenue.

ROOMDEX leverages hotel operational and software experience gained by our team members while in leadership roles at companies such as MICROS (now Oracle Hospitality), Nor1, Duetto, StayNTouch and Shiji to develop our innovations in hotel automation, dynamic pricing, operational availability and attribute-based selling. Since founding in spring of 2020, ROOMDEX has signed hundreds of hotels across North America, Europe and Asia Pacific.

Website https://www.roomdex.io
Twitter: @ROOMDEX
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Jos Schaap
ROOMDEX, Inc.