Why Hotels are Struggling to Offer Ancillaries
Hotel ancillary strategies are currently in a state of infancy, however there is a huge growth opportunity. Airline ancillary revenue has grown over 200% in the past eight years. The 2018 Cartrawler Yearbook of Ancillary Review states that in 2017, 73 out of 146 of the world’s airlines generated a combined $47.2 billion in extra revenue. Airlines started selling ancillaries ten years ago, when the opportunity to increase revenue was realized.
Thinking About the Hotel Experience
According to the “Ancillary Revenue and Personalization” survey conducted by HotelMarketing.com, the market for ancillaries is estimated to be between $80-130 billion. Over half of hoteliers surveyed said that they want to be able to up-sell to their customers during the in-stay experience.
What Problems Need to be Solved
The same survey shows that 57% of hoteliers plan to increase their investment into ancillaries in the next 12 months. Additionally 23% of general managers said their revenue management system (RMS) does not account for any ancillary spending, while another 20% indicated they do not have an RMS at their property. Many hoteliers are struggling with managing a wide-ranging disparate tech stack to manage their ancillary revenue strategy.
The on-property ancillary systems such as golf tee times, cabana rentals, or spa services are rarely connected to each other, let alone connect to a CRS, CRM or PMS. If the hotel offers third-party ancillaries such as car rentals or tour & activity tickets, the booking engine is separate from the hotel booking path and separated from the other services. Hotel Ancillary services are typically not connected into the loyalty program, which is where the greatest opportunity exists for increasing engagement and the value of the loyalty program
Hotels are currently piecing together a time-intensive, difficult-to-manage collection of systems that do not generate a clear view into revenue strategy, cross-promotion or a consolidated itinerary for the consumer, ultimately leading to a reduced guest experience and lost revenue.
Hotel Ancillary Management System
Uniting on-property and third-party ancillary offerings into a single framework, through an ancillary management system, provides the hotelier to better leverage, manage and optimizes ancillary revenue tactics. Additionally, integrating all ancillaries into a single viewport easily facilitates the online customer booking journey.
The ancillary management system can consolidate all ancillary bookings into a master booking record enabling on-property staff an easier access to the customer’s itinerary and opportunity for cross-sell. Additionally, connecting these ancillaries into the hotel’s loyalty program and offering point earn and burn for both on-property and third-party offerings adds additional value to the loyalty program and increases user engagement.
Hoteliers have the opportunity to better serve their customers, while increasing internal efficiencies, by partnering with trusted software provider, adopting a proven ancillary management system. iSeatz has almost 20 years of experience providing leading-edge, innovative ancillary management tools to the travel industry, including brands such as American Express, Delta, Marriott and IHG.
For more information about OneView AMS or to schedule a Demo, please visit www.AncillaryManagementSystem.com.