Shangri-La Hotels and Resorts, TSA Solutions and Brand Karma, released the results of an in-depth study into upselling's ability to affect the number and quality of positive guest reviews. The study results reveal that a successful upselling program is undeniably correlated to a simultaneous rise in guest satisfaction and online reputation. In light of research conducted by Cornell University that similarly demonstrated a significant increase in property revenue as a result of a boost in online reputation, the presence of an effective front desk upselling strategy has never been more crucial to business success.
TSA Solutions has been a global partner with Shangri-La Hotels and Resorts for many years, having implemented its front desk upselling (FDU) program across the group's portfolio, and especially in the most recent years, has noticed the significant advantage that accompanied the resulting increase in the hotels' front desk teams ability to upsell: a substantial rise in favorable online reviews. Many of these reviews specifically mentioned a provided upgrade and/or upsell as a positive factor in their stay. Previously, no data had been collected or analyzed to validate such a relationship, or that of upselling's ability to influence long-term profits. Now as a result of the joint efforts of Brand Karma, TSA Solutions and Shangri-La Hotels and Resorts, evidence of the relationship can be observed as follows:
- After analyzing more than 11,000 online property reviews, Brand Karma's findings concluded by using an overall satisfaction scale of 1 to 5, that reviews from guests who agreed to an offered paid upgrade culminated in a 4.6 score regarding their hotel stay experience (compared to 4.7 attained by those offered complimentary upgrades).
- When reporting on "value for money" feedback, those same guests scored a 4.2 on a 1 to 5 scale, almost as high a satisfaction score as those who received an upgrade for free.
- Overall, Brand Karma's analysis translates into paid upgrades obtaining a 25 percent higher satisfaction rate for guests with no upgrades, surpassed only by complimentary upgrades at 33 percent satisfaction, which represents a marginal gain in satisfaction considering the loss of revenue opportunity.
- In comparing its influence on guests providing recommendations, those that accepted an upsell scored a 1.3 out of Brand Karma's 3 point scale, even higher than the 1.2 assigned to those with complimentary upgrades and more than double guests with no indication of an upsell.
- Alternatively, those who reported the lowest satisfaction experience came from reviews where a proposed upsell was rejected by the guests, demonstrating the critical need for front desk teams to understand how to tune into a guest to explore if an upsell should even be presented.
Using software platforms such as Brand Karma iO, hotels are able to discover insights from the review and social media data about a brand and its competitors. From there, iO integrates a hotel brand's external business data feeds, detecting correlations across performance data. (e.g., if my TripAdvisor ranking rises 2 places, what's my expected change in RevPAR?) In this study, Brand Karma applied that formula to 20 Shangri-La properties around the world.
"Our research shows that hotels offering paid upgrades can have their cake and eat it, too: higher rate, satisfied customers, and good reviews, said Morris Sim, ceo and co-founder of Circos Brand Karma. "A successful upgrade can happen if the hotel selects the right customer, communicates the offer honestly, and fulfills the customer's expectations at the higher rate."