by: Paige Parrington
Time to read: 6 mins
New Year, new Covid variant. More uncertainty for hoteliers.
Across the span of two years, countries have closed their borders, domestic travel has been restricted and strict distancing laws have been enforced, causing a domino effect of large falls in hotel turnover, staff layoffs and dependence on government aid.
The good news is that glimmers of recovery are beginning to shine brighter now that domestic tourism has restarted after the debut of Covid-19 vaccines and booster jabs, helping to mitigate the impact on jobs and hotels in some countries.
The challenging news is the delay of the return of international travel, which holds the biggest impact across the industry. AHLA President and CEO, Chip Rogers, said in a statement:
“[...] The uncertainty about the omicron variant suggests just how difficult it will be to predict travel readiness in 2022, adding to the challenges hotels are already facing.”
Though, that’s not to say that the recovery from the blow to tourism and hotels is a waiting game. With the right planning, strategies and partners, hoteliers can start to look to a brighter future, allowing them to get ahead of the curve when more widespread international travel returns.
Ancillary revenue is one of the strategies hoteliers are contemplating to aid them in the fight against Covid-19 to their businesses. But just exactly what is it, how can it help hotels and where do you start?
The idea of incorporating new strategies into your hotel can be daunting but if you follow our ancillary revenue ideas, we’ll show you how easy it can be.
Before we get into it, let’s make sure we’re following the same definition of ancillary revenue. Simply put, ancillary revenue is when you take income from additional services or products offered at your hotel.
Since the unanimous decision from Apple and Google to kill the third-party cookie, it’s becoming increasingly common amongst businesses across a variety of sectors and sizes to diversify the sources of total revenue and focus on a customer-centric approach.
For example, airlines have created a network of partners to offer relevant ancillary streams to travellers at different stages of their trip, without losing personalisation or convenience for the traveller.
Pretty cool, right?
To really get the benefits of ancillary revenue as a hotelier, you will need to ask yourself:
By answering these questions you’ll begin to see the ancillary revenue opportunities clearly that fits with your hotel.
Are guests raving about a particular amenity? Such as how the towels feel against their face, the quality of shampoos making their hair silky smooth, or simply just how much they love your china and how it would fit perfectly with their decor at home!
Whatever it may be, this could be a great option to partner with your supplier and open a mini-shop on the premises, or online as part of your website to sell to guests.
You could even go one step further and create your own branded swag, or promotional products, like mugs, fridge magnets or postcards. Travellers like to bring home a piece of their trip in any way they can.
No matter which route you take, either way, your guests will be reminded of your hotel when they return home, enforcing your brand and raising the chances of a return visit or referral. It’s also a nice way to make a little extra revenue.
Think about the location of your hotel, is there a pool, spa or gym nearby? Chances are your amenities aren’t just of interest to the guests. If options are limited or your facilities far-outrank others in the area, locals will sure to be wanting a piece of the pie.
There are a few routes you could take with this idea, such as offering monthly memberships, package deals or hourly rates.
Alternatively, if you’re not able to do so or do not have the facilities, you could instead focus on the corporate sector and rent out conference rooms for business meetings or events. Or better yet, as a shared co-working space for business travellers or locals who need to get away from the working from home status-quo.
By focussing on the corporate sector you’re opening up to a market that is more commonly extending work trips for leisure, the practice creatively named bleisure, increasing the likelihood of repeat business and revenue.
Contact local artists and craftsmen to put their art, furniture or ornaments up for sale in your hotel and gain a commission percentage.
Shared spaces within your hotel could be made into galleries or you could have the items hung up and decorated throughout your hotel; within guests’ rooms and facilities, with price tags declaring that they are for sale. Similarly to idea 1, this could also be brought to life through an online shop accessed by your website.
The Bedruthan Hotel and Spa have executed this idea beautifully with their on-site and digital design shop, Create Cornwall, offering sustainably-designed objects and local artwork with the added bonus of e-gift vouchers starting from £20.
It’s a nice touch to declare support for small local businesses with the added revenue bonus.
If your facilities allow, hire local talent to perform at your hotel and invite your guests and locals. They could be:
Whether you choose to include the entertainment event as an additional fee, discounted for guests or rely on the profits from the restaurant or bar, creating your own entertainment will guarantee happy guests and additional revenue.
What are the main attractions nearby that your guests go to see? Are there any hidden gems that you recommend when they arrive? Maybe your guest want to organise these ahead of their stay and want inspiration from you?
Why not make money from your recommendations and these popular events by offering them at your hotel, on your website and via pre-stay emails? Selling tickets to the biggest and best events such as concerts, museums, theatre, theme parks and more will capture the attention of prospective and current guests, who may even extend their stay with the right experience!
How it works is that through a direct partnership with a business, or through a ticket supplier, the hotel receives a percentage of the profits with every ticket sold, making the partnership between your hotel and the event business equally beneficial.
Each of these ancillary revenue ideas provides an opportunity for your hotel to increase revenue, accelerate growth and provide guests with a remarkable experience.
Tickitto can guarantee a return on investment by selling the best experiences and events the world has to offer. We are an aggregator of tickets who help businesses of every size provide a frictionless ticket buying experience for their customers that generates additional revenue for 1% of the effort.