COVID has hit the global hotel industry hard. But as with every crisis, new opportunities surface. During the financial crisis of 2008/09, we saw Airbnb and Uber emerge.

Many revenue-generating ideas were born over the past year. From staycation and workation to renting out equipment and even offering outsourced services like housekeeping. Hoteliers have been creative in finding ways to keeping their business afloat.

What was born out of a need for survival might lead to a more permanent shift in a hotel's business model.

The idea of non-room revenue is nothing new and even pre-pandemic was something more and more hotels embraced. F&B or MICE revenue management is still in its infancy for the overall industry but terms like Total RevPAR have evolved from buzzword to serious KPI.

Is now the time to look at non-room, ancillary revenue? Where are the opportunities?

Valyn Perini
Valyn Perini
Vice President, Partnerships and Marketing at Nor1

There has never been a better time to offer non-room products and services to hotel guests. While it's not easy to compare year-over-year in the current global situation, we see a marked increase in guest demand for these offers in the first quarter of 2021 vs. the first quarter of 2020. This continues the trend we had seen even prior to the pandemic, and we expect this trendline to keep rising. Why? Because guests are already used to purchasing ancillary services from other travel providers to be able to customize their travel experiences. As travel comes back, we expect guests will absolutely want to create a hotel stay that meets their needs in an uncertain time.

 

Hotels should seize this opportunity to rethink their revenue strategies – guests have a changed mindset, and we as an industry should change ours. This doesn't mean nickel-and-diming guests – this means understanding what in your brand or hotel group or property is valued by your guests so you can present offers they are actually willing to buy. Hotels using Oracle's Nor1 upsell and guest engagement solutions are presenting food and beverage offers, including boxed meals, in-room cocktail sets, and pre-ordered in-room dining; discounted parking passes; and the always popular (and always profitable) early check-in and late check-out.

 

As other on-property services open up, including restaurants, bars, spas, and full-service pools, we encourage our customers to capture that guest demand for a 'normal' travel experience by offering up those services from booking to check-in. We do hotel, and our guests, a disservice if we don't.

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