When you book a Ryanair flight, the base fare is almost irrelevant. The money is in the seat selection, the priority boarding, the checked bag, the travel insurance, the hotel cross-sell, the car rental. The "product" is the chassis. Everything else is the margin.
Hotels have had the same opportunity sitting in front of them for years. And yet, in most properties, the minibar is stocked with items nobody buys, the spa runs at 40% capacity, and the front desk team still asks "Did you want to upgrade?" the way a fast-food cashier asks “Do you want fries?”
That's changing, faster than most of the industry realities.
The platforms are no longer just upsell tools
A few months ago, PhocusWire published a piece that got me thinking. The headline was about ancillary tech “transforming the stay experience.” Fair enough. But the detail was what stuck.
Erik Tengen (now President of Hospitality Upselling at Plusgrade, and someone whose work I know closely given my role at Oaky) described how specialist ancillary platforms have evolved from single-purpose upsell engines into what he called a "Swiss Army Knife." Hotels are discovering that these tools don't just generate incremental revenue. They improve online reputation. They build loyalty. They help properties reposition for entirely new guest segments.
That's a significant shift in how to think about the ROI of this technology.
The data backs it up. Wyndham reported ancillary revenues up 18% in Q3 2025 versus the same period in 2024. Oracle's Nor1 platform generated $300 million in upsell demand across its hotel partners between June 2024 and 2025; to 20% lift year-on-year. Choice Hotels saw a 17% uptick in upsell revenue per transaction using the same platform.
These are not rounding errors. This is a revenue line that most hotels are still treating as an afterthought.
The 50% problem
Here's a number that should make any revenue strategist uncomfortable: approximately 50% of global ancillary revenue is still room upgrade-related.
Think about what that means. The industry has had access to upselling platforms, pre-arrival communication tools, AI-driven personalization engines, and dynamic pricing for ancillaries for years. And we're still, collectively, selling room upgrades as our primary lever.
Upgrades are great. High margin, low friction, easy to automate. But they represent the floor of what's possible, not the ceiling.
Airport transfers. Spa packages. Curated local experiences. Dietary preference menus booked before arrival. Late check-outs priced dynamically by demand. The long tail of ancillary is extraordinary. Erik mentioned that Plusgrade's hotel partners are collectively selling over 10,000 different types of things.
Most hotels are selling maybe a dozen.
Two models. One strategic question.
The most useful framework I've seen for thinking about ancillary strategy comes from that same PhocusWire piece. It described two distinct approaches hotels are taking:
The easyJet model: de-bundle the stay. Let guests build their own package by adding components individually: parking, breakfast, early check-in. Price transparency. Clear add-on logic. Efficient.
The "something from nothing" model: create experiences that didn't exist before. The example that stuck with me was boutique hotel group The House of Gods and their Treat Me Like I'm Famous package. Guests arrive to photographers taking their picture and asking for their autograph. They feel like a celebrity for the entire stay.
That package didn't require capital investment. It required imagination and execution.
Both models work. But they serve different properties, different brands, and different guest profiles. The strategic question isn't which model is better. It's: which one are you actually capable of executing consistently?
The real barrier isn't technology
I want to push back on something here, because I've seen it play out in too many properties.
The conversation in hospitality tends to frame ancillary underperformance as a technology problem. Get the right platform, connect it to your PMS, automate the campaigns, and watch the revenue roll in.
It's not that simple; because technology is a multiplier, but not a substitute. If your front office team doesn't believe in upselling, the Front Desk Upsell automation won't save you. If your operations team can't fulfill a spa booking made three days pre-arrival, the pre-arrival campaign will hurt you. If your revenue manager and F&B director are still working in separate spreadsheets, your TRevPAR will never reflect what your property is actually capable of generating.
The hotels getting the 18–20% ancillary revenue lifts aren't just using better tools. They've built a commercial culture around total guest value, where every department understands that the room booking is the beginning of the revenue conversation, not the end of it.
That culture doesn't come from a software implementation. Instead, you must look into leadership, training, and a clear commercial strategy.
The opportunity is still wide open
Here's the thing about all of this: the market is still early.
Despite the platforms, despite the data, despite PhocusWire running features on it, ancillary revenue remains one of the most underexploited levers in hospitality. Smaller and mid-sized properties, particularly in Europe, are still not integrating upsell strategy into their pricing and operations in any structured way.
The 40% of total revenue that ancillaries can represent in a full-service property? Most independent hotels are generating a fraction of that.
That's not a failure of technology. That's a gap in strategy, training, and execution.
Which, if you're thinking about where the consulting and educational opportunity sits in this market…that's precisely where it is.
Let's talk about how your hotel can grow revenue by serving the guests who truly value what you do. Visit torreshospitalityconsulting.com or connect directly on LinkedIn.
