Here’s a deeply troubling trend: Hotels, eager to lift their historically low earnings, are introducing more “nonrefundable” rates. Guests often have no choice but to pay them.
Reader and travel agent Suzan Alexander has a case-in-point, which I’ll get to it in a moment. Before I do, let me acknowledge that some of you may be uncomfortable with my choice of words. After all, no one is being herded into the hotel lobby at gunpoint.
But how else do you describe these pricing hijinks? This kind of thing has been happening with airlines for years. If you want an affordable ticket, you’re more or less forced to buy a highly-restricted, nonrefundable fare. Otherwise, the price of your ticket doubles or triples.
Here’s what Alexander had to say:
I am an agent who books hotels all over the world and I am noticing more and more hotel chains and individual hotels offering a discounted price for paying in advance. This type of booking does not allow any changes and is non-refundable.
This used to be a bit of a bonus in that you could save a few dollars if you were sure that you would be traveling on the dates booked. However, what I am seeing now is a real difference in price between the pre-paid and flexible rates.
Yesterday, the difference on a room in San Francisco was almost $100 per night! This leads me to believe that the option to be able to cancel 24 hours in advance is slowly disappearing unless you want to spend a lot more money for a room.
Alexander wondered if I had noticed the same thing. I have, but not a $100 price difference. That’s pretty extreme.
It seems to me that a hotel room is becoming like a plane ticket — and in some respects worse. You pay now and don’t expect to make any changes should life interfere with your plans. What can one do about this, besides pay a greatly inflated fee for a room or save money on the room and spend the difference on travel insurance! What is going on here?
Well, isn’t this a great deal for hotels? Those that can afford a refundable room — business travelers — will pay top dollar for their accommodations. They may cancel, but assuming most don’t, the company makes lots of money. The rest of us book a room and the hotel gets to keep the money, no matter what happens.
Talk about a win-win.
I think hotels can do better than stealing a page from the airline industry’s playbook. People, this is the hospitality industry!
Guests don’t mind paying different rates for a suite versus an ocean-view room, or getting a discount for booking early. But $100 more per night for the ability to get a refund? Come on. They can do better than that.
(Photo: Prescott/Flickr Creative Commons)