Travelers love free upgrades. Who wouldn’t be thrilled by an oceanview suite with a jacuzzi at no extra charge? You can’t blame guests for dropping subtle hints or mentioning special occasions, hoping to unlock these coveted experiences.
NB: This is an article from WebRezPro
Subscribe to our weekly newsletter and stay up to date
But the magic of upgrades isn’t only for them. When used strategically, complimentary upgrades can be a powerful tool for hoteliers to optimize occupancy, enhance guest satisfaction, and build loyalty.
Why Free Room Upgrades Work
There’s nothing more memorable for a guest than receiving more than they anticipated. That unexpected touch – the upgrade, the added comfort, the thoughtful surprise – creates a spark of excitement that lingers long after their stay. When expectations are exceeded, guests don’t just remember where they stayed, they remember how they felt. This enhanced guest experience gives them an incentive to return, and returning guests can be among your most valuable. Raising your customer retention rate by only five percent can grow profits by 25-95 percent.
Returning guests often become your most powerful ambassadors, spreading word of your property to others in their circle. Sixty percent of consumers share brands they’re loyal to with family and friends.
Free upgrades also showcase premium accommodations without publicly discounting rates or diminishing perceived value. By filling higher-category rooms, you not only highlight your premium amenities but also encourage increased ancillary spending and elevate guest satisfaction – leading to fantastic reviews!
Lastly, upgrades serve as an elegant solution for balancing occupancy and managing booking overflow when standard rooms are sold out.
When to Offer Free Upgrades
Despite the above benefits, offering free upgrades without a strategy or principles in mind can cost you revenue without resulting in any long-term gains for your property. Premium rooms represent your most desirable inventory – the very spaces guests are willing to pay extra for – which is why an intentional approach is essential for maximizing profitability and guest loyalty.
As a general rule, offer free upgrades during shoulder season or periods of low occupancy and avoid peak times when those rooms can command full rates. Doing otherwise leaves revenue on the table and harms your bottom line. An important exception arises when standard rooms are oversold. In such cases, offering a complimentary upgrade is far preferable to relocating a guest to a competitor property. Walking a guest not only means forfeiting revenue but also risks damaging your reputation with a disappointed traveler who may share their negative experience publicly. Ultimately, it’s always better to delight a guest with an upgrade than to deny them the stay they originally booked.
