By Pierre Marechal, Vice President, Strategic Advisory & Asset Management at JLL
When hotel owners look for new sources of revenue growth, the conversation usually centres on the big commercial levers.
Pricing strategy. Market share. Distribution costs. Corporate contracts. Business mix optimisation. All of these matter.
Yet one of the industry’s most profitable opportunities continues to be overlooked: upselling.
Unlike many revenue initiatives, upselling requires little additional capital, minimal operational change, and no major sales investment. The inventory already exists. The guest has already been acquired. The booking has already been made.
The opportunity lies in increasing the value of that booking.
When executed well, the financial returns can be substantial.
Highlights
Why Upselling Delivers Exceptional Returns
Few commercial initiatives offer economics as compelling as upselling.
Acquiring a guest is expensive. Hotels invest heavily in marketing, distribution, loyalty programmes, and sales efforts to secure every reservation.
Once that booking is confirmed, however, the commercial equation changes.
A guest who upgrades to a premium room, purchases club lounge access or adds a spa treatment generates incremental revenue with very little additional acquisition cost. Much of that additional income flows directly to the bottom line.
For owners, this is particularly attractive because profitability improves without increasing room inventory.
No new rooms need to be built.
No major renovation is required.
The hotel is simply extracting greater value from the demand it has already secured.
The Biggest Upselling Mistake Hotels Still Make
Traditionally, upselling has been associated with a simple question at check-in.
“Would you like to upgrade your room?”
While room upgrades remain valuable, they represent only a fraction of the opportunity.
Today’s leading hotels are embedding upselling throughout the entire guest journey. The process often begins immediately after the reservation is confirmed and continues before arrival, throughout the stay and even after departure.
This broader commercial approach enables hotels to monetise a much wider range of products and services.
These may include:
- Premium room categories
- Suites
- Club lounge access
- Early check-in
- Late check-out
- Airport transfers
- Spa treatments
- Dining experiences
- Wellness programmes
- Destination activities
- Celebration packages
- Meeting room upgrades
Each successful upsell creates incremental revenue while enhancing the guest experience.
These objectives are not mutually exclusive — they often reinforce one another.
The Shift from Check-In to Pre-Arrival
One of the most important developments in recent years has been the growth of pre-arrival upselling.
Rather than waiting until check-in, hotels are increasingly engaging guests days or even weeks before arrival with personalised offers.
The timing matters.
Before a trip begins, guests are actively planning their stay and are often more receptive to enhancing their experience.
An anniversary couple may welcome a suite upgrade.
A business traveller may value guaranteed early check-in.
A leisure guest may be interested in curated local experiences.
The earlier these options are presented, the greater the likelihood of conversion.
Pre-arrival upselling also provides hotels with better forecasting visibility, allowing teams to manage inventory and operations more effectively.
Personalisation Is the New Revenue Engine
Technology has transformed the effectiveness of upselling.
Historically, hotels relied on generic offers presented to every guest.
Today, many platforms tailor recommendations based on factors such as:
- Guest profile
- Loyalty status
- Previous stay behaviour
- Length of stay
- Booking channel
- Travel purpose
- Inventory availability
The result is a far more relevant guest experience.
A family travelling during school holidays should not receive the same offers as a corporate traveller staying for a one-night meeting.
The more personalised the recommendation, the higher the likelihood of conversion.
From an owner’s perspective, that translates into stronger revenue performance without increasing marketing spend.
The Revenue Opportunity Beyond the Room
Perhaps the greatest opportunity lies outside guestrooms altogether.
Many hotels continue to under-monetise ancillary services despite growing consumer demand for convenience, exclusivity and memorable experiences.
Today’s guests increasingly expect flexibility — and many are willing to pay for it.
Consider the revenue potential of:
- Guaranteed early check-in
- Extended late check-out
- Premium Wi-Fi packages
- Wellness experiences
- Private dining
- Exclusive access programmes
- Curated local activities
Individually, these offerings may seem modest.
Collectively, they can create meaningful new revenue streams while strengthening the property’s overall guest proposition.
For resorts, lifestyle hotels and luxury properties, the opportunity can be especially significant.
Why Owners Should Care About Upselling
Owners should view upselling through a much broader commercial lens than simply generating additional sales.
Effective upselling contributes directly to:
- Total revenue growth
- Improved profitability
- Higher guest satisfaction
- Revenue diversification
- Stronger asset positioning
As room rate growth becomes increasingly difficult to sustain in many markets, these alternative revenue streams become even more valuable.
Hotels that consistently increase spend per guest will often outperform competitors, even when average room rates remain broadly similar.
This is one reason sophisticated investors are placing greater emphasis on total revenue performance rather than rooms revenue alone.
Final Thoughts: Stop Leaving Revenue on the Table
The hospitality industry has become exceptionally sophisticated in pricing, forecasting and distribution.
Yet upselling remains surprisingly inconsistent.
Some hotels have fully embedded it into their commercial strategy.
Others still treat it as an occasional front desk conversation.
The difference in financial performance can be substantial.
As operating costs continue to rise and owners search for new sources of profitability, upselling remains one of the most accessible opportunities available.
The guests are already there.
The inventory already exists.
The infrastructure is largely in place.
The question is no longer whether upselling works.
The real question is whether hotels are doing enough to unlock its full potential.
Highlights
Read the Chinese article here.
