Thought Leadership

As we have heard many times, 2020 was a year like no other. But our problems are not over. Hotels are hurting on all metrics. Occupancy is down, rates have dropped, and hotels are trying to figure out how to make up the revenue. But some hotels have discovered a new twist on an old technique: upselling. Traditionally upselling required a lot of labor and team effort to get the upsell to work – but with ROOMDEX the ability to capture that additional revenue has never been easier.

We caught up with Kevin Le, Area Director of Revenue Management at Modus Hotels – The Windsor Suites, to get his thoughts. He spoke to us about upselling; his perspective on ROOMDEX upselling, and his view of the future.

Kevin, how is business going right now? What is the state of affairs for hospitality in Philly?

It’s definitely not as robust as 2019, but every day we see the needle moving in the right direction. With the vaccine announced, we are already seeing an uptrend. So right now we are trying to maximize revenue as best as we can with the tools that we have.

kevin le interview

I am very curious to hear from your previous experience with upsell procedures and/or software and how it compares with your experience with ROOMDEX?

I always thought that upselling was a wild card. Within revenue management – we never had the right software to maximize that. We tried an incentivization program through the front office, Nor 1 and also partnered with Drake and Beil. But with Drake Beil, the results were okay, but they could have always been better.

So, when I came on board and saw ROOMDEX my initial reaction was, “I need to see what ROOMDEX can do.” I like the ability of being able to automatically teach the system, dynamically yield off BAR, during low and high demands, by day of week and room types – it is all pretty impressive in my book.

So, let’s talk about the ongoing management of the system. Is there much for you to do? How much do you have to intervene in the process of upselling?

Well, there is definitely a big variance now versus in the past as far as the upselling tools we have on hand. Before ROOMDEX Upgrade Optimizer, it required a lot of labor and cohesive team engagement to get the upsell to work. Now, everything seems more efficient. Being able to yield and manage the system in the background is definitely been a plus. The front office is also now able to focus on personal touches with each guest. For example, with Covid and a focus on safety and health, we don’t want to minimize the little contact time we have with selling.

Speaking of Covid, we have seen rates drop in the ongoing battle to acquire those few travelers out there right now. We have heard that hotels are trying to figure out ways to make up the revenue that they are losing on the lower ADR. Are you seeing that yourself? How might ROOMDEX help with that?

During these unprecedented times, hotels are definitely hurting on all metrics. Being in revenue management we want to look past RevPAR as demand is down. So, we want to see where else we can make an impact. We think we should focus more on GOPPAR and how we can help operations be more efficient. Regardless, what we can do is look to auxiliary income and ROOMDEX transitioned beautifully here. With very little labor – and very little cost to us as well – we have already seen pretty good results in the last 90 days.

Right now, the whole industry is very focused on room types and room categories. When you look across your room types do you feel that ROOMDEX is helping sell some of these nuances within room categories better on the upsell side?

Absolutely. With occupancy at an all-time low right now, we want to maximize revenue per occupied room through any way possible. So ROOMDEX has definitely offered a unique ability to capture that additional revenue, pre-arrivals and also the second chance at suites options. What we are good at is ensuring that we have that feature such as the special views that you mentioned, whether its balcony view, city views, interior view, already available and ROOMDEX is pretty much the gas to the fire to make that as efficient and as seamless as possible to the guest.

And you know what I really like about it is when the guests see the offering for a suite on the website, they are maybe 70% sold, but for whatever reason, don’t finish through, ROOMDEX basically provide us with a second chance at that particular offering through email. With the follow up of a second offering they sometimes then go ahead and make the decision to buy up.

So, let’s talk a little bit about performance and your view of the future. You have mentioned that ROOMDEX is already performing really well for you. Do you think your upselling success is unique to the low occupancy environment or do you think that it will continue being successful, if not more successful as occupancy increases?

It’s definitely moving in the right direction. With the pandemic occupancy levels are pretty low but demand is growing. As I mentioned earlier, with the vaccine news we are seeing an uptick in the pick-up. So once things normalize, I would assume that ROI will organically increase plus give us a little bit more opportunity to yield. We maybe even be able to play around with the differentials as far as the discounts on the upgrades. I also really like the three different pricings that ROOMDEX offer as far as pre-arrivals and late departures. I think there is definitely some opportunities in there and I think it only gets better as the market returns.

Early check-ins and late check outs are obviously a direct relationship to your occupancy so ultimately, it’s going to go up as soon as your occupancy goes up.

Yes – and what I didn’t anticipate was the early arrivals and late departures to do very well. Room upgrades are great, but the forgotten piece is the early arrivals and late departures. I think other hotels and management companies will be surprised with the results themselves.

You know, it’s one of those things where, we are living in an era driven by a lot of customization of what we purchase.

Absolutely, I think you are right on it. And what the customer needs is something simplistic, seamless, and easy. Seamlessness is what is going to move conversion numbers even greater. Because everyone is now in a rush and, at check-in, they really don’t want to spend too much time at a desk. You give the essentials and they just want to check to their room. As far as upgrades, I don’t think in today’s world front office is going to be able to spend a minute or two, even 30 seconds explaining each room type available at the desk.

Are there any insights or thoughts that we haven’t covered today that you want to mention?

The only thing is that I was excited to hear from the team at ROOMDEX that there is going to be more add-ons and enhancements coming down the line. So, I am really looking forward to those and how we can move the needle even further on other metrics.

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