F&B Online Ordering: How to Drive Revenue when Hotel Occupancy is Down
Consumer preferences and behaviors regarding hotels are changing. SevenRooms’ recent study, “Beyond the Booking: Meeting & Exceeding Hotel Guest Expectations” explored the changing landscape of hotels, and how COVID-19 has ushered in a new era of hospitality.
Whether from formal mandates, guest sentiment and health concerns, or a combination of both, occupancies are down in hotels 32%. Though almost half (46%) of Americans would be open to booking a hotel today, the circumstances have to be right. This means that the traditional revenue from room nights can no longer be relied upon as the largest channel for operators. So how can hotels still capture revenue from the guests who do not feel comfortable booking a hotel stay? The solution is serving locals with takeout and delivery.
The Power of Locals
Locals are an often overlooked segment when operators think about how to drive incremental revenue at their properties. However, with travel significantly down, there’s no better time than now to embrace the power of locals. There are three main areas where locals can boost your bottom line: staycations, reservations at your F&B outlets, and takeout and delivery.
Staycationers: Our recent study found that 21% of Americans open to booking a hotel visit are planning that stay as a staycation, and 59% want to make a reservation at a hotel restaurant in advance of their stay. These ‘staycationers’ provide the perfect opportunity to drive revenue across both room nights and from F&B outlets.
Reservations for Locals: Though they may not be hotel guests, many locals are still looking for a great dining experience. Your F&B outlets benefit from the ability to operate as a separate entity from the hotel — lower room occupancies do not necessarily need to translate into lower F&B covers.
Takeout & Delivery: If you weren’t already offering takeout & delivery pre-COVID, chances are you either are now, or want to be. Takeout and delivery have become lifelines for restaurants facing reduced capacity, shorter hours, outdoor-only dining, and less propensity for dining out in general. Consumers are craving the convenience and delicious food from their favorite restaurants for a sense of normalcy. But how do you ensure that offering delivery doesn’t cost more than it gives?
Hotels: The Champions of Direct
Before we discuss takeout and delivery, it’s worth taking a step back to look at the broader hospitality technology ecosystem. The hotel industry caught on early that though third-party platforms offer marketing benefits through their consumer marketplaces, they don’t enable direct guest relationships. The cost of losing that guest data and ownership of the relationship became a cost too high for many hotel operators who depend on brand loyalty to succeed.
To change consumer behavior, hotels flipped the script with loyalty programs, special perks, rate guarantees, and ad campaigns like Hilton’s “Expect Better. Expect Hilton” campaign to educate consumers about direct booking and to reward them for their behaviors. With direct bookings expected to hit 50% share by 2022, hotels have cracked the code on how to reduce reliance on third party booking platforms.
Now it’s time to apply those same learnings to third-party online ordering platforms. Though these providers are great tools for discovery, fees can cost restaurants upwards of 30% of the profit on each order. That cost, paired with the cost of handing over valuable guest data that could be used to drive repeat orders, often cannot be justified. That’s where direct online ordering comes in.
Get More Out of Online Ordering
Direct online ordering provides a solution for staying engaged with locals and driving revenue even when operating at reduced capacity. Just getting started with online ordering? Check out our blog post for actionable tips and tricks on how to do takeout right. Ultimately, the biggest reward of direct online ordering is in receiving a 360-degree view of your customer — from their order history and favorite items, to their allergies and delivery or pickup preference.
Guest data has always been a crucial tool to drive reservations at F&B outlets. With the addition of off-premise data from takeout and delivery orders, operators have powerful insights at their fingertips to drive revenue and repeat business.
As a hotel, you’ve likely spent extensive time developing your brand, including your on-premise F&B outlets. Leveraging the data collected across on-property interactions, you also have a wealth of guest data that can be used to drive further awareness of your F&B offerings. When a customer comes directly to your website, as opposed to using a third-party marketplace or discovery platform, you can profit every further off every order and future visit.
Most importantly, when your online ordering data feeds into the same CRM as your reservation data (as part of your existing guest experience platform) you gain access to a holistic view of your guest across the entire customer lifecycle. With ownership of the guest data, you have all the information you need to create impactful marketing campaigns that drive repeat orders, convert those orders to reservations, and build loyalty that can carry over to your entire hotel brand.
*PRO TIP* Make your local customers feel special and drive demand with a “Local Exclusive Menu” on a certain day of the week, where locals can order from a special prix fixe menu online. Owning your guest data means you’ll know who’s a local, and who to send email marketing to to promote your offering!
There is also no better time than now to embrace contactless order and payment. Going contactless at your rooftop bars, pools, and cabana means a streamlined operational experience for you, and a safe and easy experience for your guest. Of course, you’ll want a platform that can bring together the data gathered during a contactless order with other on- and off-premise data from that specific guest. Imagine the power of promoting your guest’s favorite takeout order items when they are lounging poolside. Contactless ordering and payment means easy incremental revenue.
For more tips and tricks for making the most of your online ordering presence and driving repeat orders, check out our Online Ordering Calendar Marketing Calendar.
COVID-19 has changed nearly everything about how the hospitality industry operates. Luckily, hotels are in the unique position of not only having multiple ways to drive revenue across on- and off-premise, but also knowing the power of direct. Ready to get more out of online ordering for your F&B outlets? We’d love to talk.