At the end of the day, there are just four ways to grow group business as a caterer or hotelier.
- Increase the number of clients you serve
- Increase the frequency with which your clients deal with you
- Increase the average value of the sales transaction
- Improve the effectiveness of the processes in your meeting, hotel, etc.
Upselling and cross-selling address the third way — and a slight increase can go a long way.
Think about how many guests you serve in a given year. If you were to add one dollar to each of them, what would that add to your bottom line at the end of the month, quarter, or year? Thinking this way starts to paint a picture of the potential impact of effective F&B upselling techniques.
In this post, we’ll explore proven upselling and cross-selling strategies, laying out tips and ideas that can help your catering business or venue drive more catering revenue.
What is Upselling & What is Cross-selling?
Upselling is selling a more expensive and upgraded version of an item that was originally ordered, such as suggesting a more expensive cut of meat or a better vintage wine.
It can also pertain to the service level or type, such as offering continuous F&B service throughout the day as opposed to set meal times.
Cross-selling, on the other hand, is selling items that are different, but related to the original item, such as add-ons. An example would be suggesting an additional course or adding a dessert wine. Fast food has been using cross-selling techniques for decades, always asking, “Do you want fries with that?”
Upselling and cross-selling can be extremely profitable for you as the sales person and for your business. The key to both is showing a client the value in the “upgrade” and upping the final purchase slightly.
How to Upsell F&B Successfully
If you and your staff aren’t trained on effective ways to upsell or cross-sell, you run the risk of either offending clients by being too pushy or leaving money on the table that could have otherwise padded total value. Either option can be costly.
The key is to show how adding the additional menu item, service, etc., will increase guest satisfaction and align with ever-changing attendee expectations. Oftentimes today, that means a healthier F&B offering.
Upselling and cross-selling usually take place after the initial sale. At this point, the major purchase has already been made, rapport has already been established, and you’ve identified a planner’s wants and needs. Plus, you’ve presented the benefits and handled any high-level objections. Upselling and cross-selling are really just an “oh, and by the way…”
You can’t be pushy, you can’t be unconvincing, and perhaps most importantly, you actually have to make an attempt. A big part of the art is is the pitch. It’s the difference between asking, “would you like some wine?” and “do you prefer a red or a white?”
What Two Waiters Can Teach Us About Upselling Techniques
Think about the following scenario: You’re at a restaurant and just finished a big meal. The server asks, “Would you care for dessert?” As opposed to giving the impression of overindulging, many customers refuse out of habit. Result? No sale.
The savvy server doesn’t ask if the customer wants dessert. They know that it’s harder to say no to something you really want when someone puts it in front of you. (Plus, most people like to finish on a sweet note — right?)
In this case, the server pulls up with the dessert tray and asks if you want to take a look. They’re still getting your buy in, but in a way that asks for permission instead of admission.
When the client agrees to hear about the desserts the server doesn’t just list them by name; he or she describes their benefits and shows the value. Instead of saying that it’s chocolate mousse, he lets the patron know that it’s Brazilian coacoa and that it’s what the pastry chef is famous for.
Upsells Are About the Event Objective
For caterers, venues, and hotel properties, catering is more than just selling food. It’s about creating a special experience by coordinating food and beverage with décor, ambiance, presentation, service-style and entertainment. It’s one of the elements of attendee satisfaction that’s very much in the caterer’s control, and, as a result, it’s a direct avenue to repeat business.
Ultimately, each piece of the experience offers a sales rep a cross-sell opportunity. And as the event planning industry continues to focus more and more on wellbeing and the creation of holistic experiences, those upsells are ultimately becoming easier. It’s a large part of the reason that total meeting spend has gone up in recent years. And with F&B profit margin increasing from 24.9% to 29.5% between 2010 and 2016, bigger F&B spends makes an equally big impact on bottom lines.
The process is part consultation and part selling. It should focus on increasing the average check, but also on enhancing guest satisfaction. The offering should map back to the overall purpose of the event. After all, the ranching convention probably doesn’t care about vegan options and a sustainability conference probably doesn’t want paper cups.
Everything you offer should make the client feel like you’re trying to improve the overall quality of the meeting for the sake of their success.
Upsells & Cross-Sell Ideas That Add Value for the Client
While there are several areas where a sales rep can offer upsells, they all boil down to three main areas: the service, the space, and the food itself. With catering, food is the easiest thing to upsell and cross-sell. Here are a handful F&B ideas you can utilize to add value for the client as well as value to the transaction.
Will there be disposal cups used at the event? If so, offer compostable cups at a higher price point. Or, used recycled or upcycled materials in decor. There a number of ways like this to weave sustainability into the experience. Attendees are focused environmentally-friendly products more than ever, and as a result, planners are making sustainability a top priority. (Just look at IMEX, who eliminated paper cups in 2018.)
We’re asking everyone attending #IMEX18 to bring reusable coffee cups. If all participants use their own cup for at least their morning coffee for 3 days, it would prevent 37,000 cups going to landfill! Find out more here: https://t.co/l2dBGZACsy pic.twitter.com/YqLNJSlj5W
— IMEX (@IMEX_Group) August 22, 2018
Local F&B Focus
Most places will have regional specialties and can offer locally sourced produce. With “locavore” habits and authentic local experiences becoming more and more important to attendees, this becomes an easy in that appeals to current meeting trends.
What about intermezzo (sorbet served as a palate cleanser), or maybe a little pre-dinner cheese trey? Small, additional courses are low-commitment offering that elevate the attendee experience. As such, planners are inclined to acquiesce.
Cater to Dietary Restrictions
Gluten-free, dairy-free, vegan, paleo… the way we eat has changed drastically over the past decade, which means meals need to be more personalized. Merely being able to offering things like dairy substitutes and vegan-friendly options is all it takes in a lot of cases. It’s the easiest upsell in the book.
Appeal to Health and Wellbeing
A recent IACC survey showed that most planners believe that different foods have a noticeable effect on attendee energy throughout the day. Couple this with the growing desire to incorporate healthy foods into diets, and it’s a recipe that can push up F&B totals while easily mapping back to the overall meeting objective.
Creative Cocktail Experiences
As Allie Hansen, Client Account Manager at STR, puts it: “[Planners] want experiences to happen, so [they say] ‘Let’s incorporate food and beverage in there… Let’s do a craft-brew taster, a wine tasting or maybe a cocktail-mixer contest or something.’ And with these trends, really in generating revenues, we’re seeing that contribution across the board.”
In the grand scheme of things, a small upsell or cross-sell in every booking leads to big revenue gains over the course of the year. By communicating the value of every proposed upgrade in terms of the specific nuances and goals of the meeting, and employing some of these upselling ideas, sales managers can set themselves up for success. Just remember not to push too hard, because at the end of the day, it’s about the client.