How to Increase Hotel Revenue: A UK Hotelier’s Guide

Hotel revenue in the UK has been on the rise, though it’s not always a matter of higher nightly prices. When researching how to increase hotel revenue, strategies explore occupancy, guest spend on extras, food and drinks, marketing and targeting repeat bookings.

For hotel revenue growth to be sustainable, it can’t rely on just marketing spend, unless it grows organic reach or improves repeat custom. This guide looks at the different growth strategies and how to measure if they’re working.

What Does Increasing Hotel Revenue Involve?

To increase hotel revenue, a revenue management strategy either aims to increase how much each customer spends, or to gain more customers. Or, both.

Customers may spend more if: 

• Rooms and amenities are improved (baths fitted, working space, free gym access) 
• Services are offered (spa, swimming lessons)
• Events are held (business conference, wedding reception)
• Food and beverages are offered (offering dinner as well as breakfast, improved kitchen team)
• Upgrades are possible, like late check-out or a pet-friendly room

Revenue also rises when your occupancy increases, which can be achieved through discounts, loyalty schemes, marketing, better photography and copy, using different online travel agencies (OTAs), or going direct to avoid OTA commission (often deducted from your payout). 

Hospitality is the third largest employer in the UK (3.6 million employees)

Key Hotel Revenue Metrics To Track

You can’t manage what you can’t measure. Below is a table of KPI formulas, with your capacity and nightly rates at the core of them. Data-driven pricing is a huge driver in revenue optimization, and the following KPIs can help guide you.

Reviewing these metrics by room type, booking channels, customer segment and time period can bring more insight, as opposed to just one blended average. This can help avoid chasing maximized occupancy at the cost of profit.

England’s hotel occupancy hit 83% in June (2026)

How To Increase Hotel Revenue

Use Dynamic Room Pricing

Fixed, year-round room rates are leaving a lot of money on the table. It means being underpriced in moments of high demand, and having low occupancy during low demand. It’s not just about the time of year, either, as you must be responsive even to nearby weekend festivals. Below are the facets of dynamic pricing strategy:

• Adjust room rates daily, not weekly, by demand, booking pace, seasonality, events, remaining availability
• Clear pricing rules in some circumstances to avoid bad PR. For example, a reasonable range is in place, to prevent profiteering during culturally important moments (e.g., your nearby university is hosting a boat race)
• Flag high-demand nights early, before OTAs, so prices don’t appear reactionary and you avoid early bookers getting a discount (e.g., a couple coincidentally booking their trip during the time of the World Cup for normal prices)
• Protect the minimum acceptable rate for low periods of demand to avoid diminishing margin and brand positioning

UK hotels (excluding London) saw full-year 2025 RevPAR increase to £79 (up 1.9%) 

Increase Direct Bookings

Each booking through a third party carries its own commission, as this is the typical revenue model for them. While they have a broad range, 10% to 25% is commonly reported, and this can be avoided with direct bookings. 

Your own website can be as cheap or expensive as you like, depending on your need for customisation. Google’s Core Web Vitals can be a useful threshold for testing, but confirm it works well on the phone, as this is now where the majority of bookings are made.

Direct booking benefits include high revenue per booking, greater control over the checkout process (can choose a cheaper payment processor, or one that only accepts certain methods), and finally, more control over the general terms agreed upon with the customer.

To entice direct bookings, you can offer more flexibility over cancellation, complimentary upgrades, free parking, late checkout, participation in a loyalty scheme, or generally a cheaper nightly rate. 

However, you must also have your own booking engine optimization and digital marketing strategy. A Google Business Profile is important regardless, but photos, copy, and marketing are more important when selling directly.

Improve the Distribution Channel Mix

Direct bookings may have a higher revenue per booking, but you also may suffer from reduced demand. Striking a balance between channels is important, as per the table below:

The net revenue from each hotel distribution channel should be calculated, with commission, discounts and acquisition costs factored in. Importantly, even if one channel is slightly better than another, being overly dependent introduces risk. 

Segment Guests and Create Targeted Offers

Treating each guest the same sounds good on paper, but it misses the mark. A solo businessman doesn’t want the same welcome pack as a family on half term. Market segmentation lets you build offers that are more tailored.

Promotional packages are perfect for holidaymakers and couples because they’re after experiences, and you may receive partner commission on sales to local attractions.

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Upsell Before Arrival and During the Stay

Upselling strategies work well when they’re a genuine option rather than going through the motions, or worse, a forced sales pitch. On top of upgrades, ancillary revenue opportunities are often some of your highest-margin opportunities.

Possible upgrades and ancillary revenue streams include:

• Room upgrades (larger, better view, hot tub, balcony)
• Amenities and attractions 
• Early/late check-in
• Breakfast, and food and beverage experience
• Parking
• Meetings and events
• Spa 

You can pitch these to customers during the booking confirmation page or in the pre-arrival email. A quick mention at reception can also be routine, so long as you’re not putting them on the spot. Premium room upgrades can often occur last minute, perhaps because of the stressful travel on the way there, or they’re simply in holiday mode.

Increase Revenue During Low-Demand Periods

Hotels usually have great data on when their slow season (or even slow days of the week) are. You likely know off the top of your head. But, what can you do about it?

Instead of just lowering nightly rate, consider these local experiences and reasons to stay beyond just holidays:

• Staycationers who want a local short break close to home amid a newborn baby or costlier flights
• Remote workers and digital nomads may be tempted by a monthly stay package, as long as there is space to work
• Small private events can use your functional space for gatherings, like a winter engagement party 18 months before their summer wedding
• Corporate travellers may be tempted by your meeting rooms and convenience, with seasonal prices not factoring into their decision

Value-added packages may grow revenue more than just reducing room rates, even if it means a lower occupancy. Partnering with tourism organisers and events that do well even during winter, such as michelin star restaurants, Christmas markets and wellness retreats like outdoor saunas. It can also be an opportunity to lean into sustainability initiatives to attract a new type of customer.

Britain’s domestic tourism hit £78 billion in 2025 (up 3% YoY)

Develop Corporate, Group, and Event Sales

Event hosting, especially corporate, is often less price sensitive than leisure bookings. You can begin calling around and building connections with local employers, often at local business owner events, along with reaching out to wedding planners, tour operators and conference organisers.

Meetings Industry Association is one way to gain visibility so that they reach out to you, as it’s a list of accredited venues that connects hotels with events agencies.

While price sensitivity is low, room for negotiation is high, especially given the large price tag. Agree on clear terms around the price, cancellation terms/protection, and any minimum spend requirements. 

However, when pricing these up, consider the lost revenue from any individual nightly bookings and risks associated with events.

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Personalise Offers With Guest Data

A personalized guest experience is only possible if you have their booking history, stated guest preferences, stay purpose, or, at a push, matching the customer type with the local context (three friends with different surnames on the same weekend as a local festival).

While it saves time to have a pre-arrival message template, tweak it when the context fits. For example, reassuring a family that the room has a cot prepared. This level of personalisation can also lead to customers showing more respect for the room, as it seems like a personable service, not a faceless corporate chain.

Use Integrated Hotel Technology

Fragmented spreadsheets are a recipe for missed bookings and accounting errors. Connecting the systems together for bookings, property management, customer database, accounting, and guest experience technology is important to minimise errors and time spent on administration.

Trade events like the Independent Hotel Show lets you compare systems side by side. Automated reporting isn’t just about compliance, it’s a revenue growth opportunity by spotting (and alerting you to) demand changes. Ultimately though, channel management software needs to support your team, not add another checkpoint for them.

AI is also increasingly useful at parsing and logging written notes. So, to encourage workers to write down feedback they receive in passing, even the loosest of notes can be parsed through an AI chatbot, logged, and fed into the core system.

Simplify Booking and Payment

OTAs make booking simple and familiar, but many hotels fail to carry over this accessibility to their own direct booking channel. 

• Reduce the number of steps for reserving a room or upgrading
• Accept common card networks and mobile wallet payment (online and at reception)
• During the booking, the following should be clear: deposits, pre-authorisations, balance payments, refunds, cancellations, extra charges
• Payment options at reception, restaurants, bars, and events. Being able to handle a room tab can improve revenue
• Investigate bounce rate and booking abandonment. Third-party testers can provide feedback

Guests expect a Tap and Go experience, even with their mobile. Portable card machines, like those from myPOS, accept Google Pay and Apple Pay, along with contactless. It keeps the less fun part of the holiday - paying for it - to a brief, painless minimum.

How To Balance Revenue Growth With Guest Experience

There is always the possibility of doing more harm than good when solely optimising for revenue. It might be that you’re improving near-term revenue, but losing long-term revenue because of a drop in customer service excellence. Here are some considerations when trying to strike that balance:

• Dynamic pricing should be done well in advance and kept within a reasonable range to avoid profiteering accusations. 
• Plan and train for service standards during maximum occupancy, even if it’s rare.
• Upgrades and add-ons must be relevant and transparent, and easy to decline 
• Train staff to recognise when certain commercial targets are making guests uncomfortable, and adjust guest engagement strategies as they go
• Monitor reviews and record feedback to spot misjudgements

Effective communication goes a long way. If you have messed up by trying to maximise revenue, being honest with guests can buy you some slack.

How To Measure Whether Revenue Strategies Are Working

The first step is to create a baseline. What is normal? Get a clear picture of revenue, profitability, occupancy, guest spending, reviews, and so on before making changes.

Once you decide to introduce a change, such as an upselling tactic for upgrades, don’t just look at how the baseline results changed - break them down by customer segment and booking channel. You may find it works for Gen-Z customers booking from OTAs, but not Gen X when booking direct. Account for commission, staffing, fulfilment, promotional cost, so that you can determine if the new package is added revenue or just moving it around. Profit, of course, is the end goal, and so margins and the opportunity cost of changes must be taken into consideration.

Revenue optimization techniques can be A/B tested, like one room type or for just a quarter. But, compare results to last year’s same quarter, not the quarter preceding it, which has seasonal changes.

Common Mistakes To Avoid

Below are some of the most common mistakes made in hotel’s endeavour for more revenue:

• Focusing too much on occupancy, ignoring room rates and margins
• Damaging brand positioning with too aggressive last-minute discounts, causing future customers to stop booking in advance
• Depending too much on one or two booking platforms, who can change commission at a moment’s notice, or push you further down the algorithm
• Introducing new software that doesn’t integrate with existing systems
• Not making full use of guest data regarding pricing, offers, trends and service
• Adding fees that are not itemised and clear
• Damaging repeat business by chasing short-term revenue growth (e.g., aggressive sales tactics, aggressive dynamic pricing)

Most of the mistakes come from trying to optimize one metric in isolation, rather than taking a broader view, and making sure long-term revenue isn’t compromised.

How myPOS Can Support Hotel Revenue Growth

Amex is a hugely important payment in the travel industry, particularly for businesses, and so using myPOS for direct bookings can ensure that you don’t alienate these customers.

The myPOS hotel payment systems more broadly comes with a free business account, instant settlement (revenue instantly becomes liquid and spendable), and the portability of the terminals allows you to take it from reception or the dining room over to customers’ tables.

There’s much less concern around no-show, as myPOS allows you to bring in revenue in most cases, with card-not-present and pre-authorised payments. Plus, payment links can be used to secure deposits and repeat payments, which is particularly useful for events and corporate deals.

Conclusion

Hotel revenue growth doesn’t just come from one change, but a combination of strategic decisions are individually measurable. Once you understand your baseline figures and customer segment, you can begin to experiment with dynamic pricing, upsells, and other growth strategies. Just make sure that your payment infrastructure is set in place beforehand, so it can handle these different approaches, and that you track results as you go.

Frequently Asked Questions