According to Peelen and Beltman (2013), cross-selling is the sales of a product or service to current customers who are already purchasing one or more products from a particular company. Different forms of cross-selling are identified, such as when customers buy one or more products during a contact, when customers buy a second or third product during a later contact, when customers buy another product within the same product range, or when customers expand the product they already bought by buying a product from another category. In the hospitality industry, cross-selling occurs when hotels sell their guests in-house services and products for example.
However, hotels are not very successful yet in cross-selling their guests services and products. According to research done by Travel Tripper, only 3% of the hotel guests book add-ons during their online booking process. On top of that, when customers are presented with too many options on products and services they can additionally book beside their hotel room, they might even abandon their entire booking (Lee, 2015). It seems that hotels still have a lot they can gain from cross-selling. So how can hotels successfully cross-sell their products and services to their customers?
The key to a successful cross-selling strategy for hotels is being there at the right place and at the right time for their guests. First, when looking at timing for cross-selling, customers are most receptive for cross-selling when they are in the phase of ‘pre-trip buzz’. When approaching customers during this phase, it is more likely that they purchase additional services or products from the hotel. Approaching customers can be done by sending them an email with offers (Lee, 2015).
However, the perfect timing will not immediately make cross-selling very successful for hotels. On top of that, it is vital for hotels that they appeal to their customers’ appeal to buy. This can only be done with offers that really speak to the customer; the offers need to compliment their original purchase and the offers need to fit the customer’s individual preferences. In order for hotels to be able to offer their customers personal offers, they need to know their customers. Hotels can only get to know their customers if they use data. Data will help hotels to get an insight into what their customers want (Subramanian, 2013).
So when hotels want to cross-sell products or services to their customers, it is crucial that their offers are well-timed and personalized. It is impossible for hotels to do this without analysing and using data.
Lee, J. (2015, August 10). Upselling & Cross-selling: The difference and why it matters. Retrieved October 02, 2016, from http://www.traveltripper.com/blog/upselling-and-cross-selling-the-difference-and-why-it-matters-for-hotels/
Peelen, E., & Beltman, R. (2013). Customer Relationship Management (2nd edition).
Subramanian, R. (2013, March 8). Tips for Using Big Data to Optimize Upsell and Cross-Sell Strategies. Retrieved October 2, 2016, from http://www.mytotalretail.com/article/big-data-can-grow-your-retail-business-upsell-cross-sell-strategies/all/