A new hotel scheme for gouging the customer

[AaronK]

Hi Amy.

I read your column with great interest today. However, I think you missed a point.

From what I have seen, some hotels have a "prepaid" rate that they charge that generally is lower than the regular per night rate. The one condition of this rate is that you pay the entire stay up front, and it is non-changeable, non-refundable. I was once booked on one of these rates for a business trip. Fortunately, the trip went without an issue.

I think the point to all is to be careful when you book your room. If the ability to cancel your reservation is more important than saving a buck, then take the slightly higher rate.

[weblet]

Actually, these rates have been around for awhile (at least 4-5 years with Holiday Inn). Doing travel for corporate people, I have to be aware of the rules of the rates I'm booking and very rarely will I book one. I always offer it, but as noted, there is usually a more "normal" rate within a few dollars.

I was just listening to a friend who has to book his travel thru Expedia (company policy) who was complaining about these non-refundable rates and how he'd gotten caught a few times with them.

So, yes, the hotel industry is taking a page from the airline industry. It works, so why not?

*sigh*

[John225]

I commented on the site regarding the article:

Sorry to disagree with you Amy, but hotels have had this practice for several years now.

To advocate that one should read the fine print when booking a room online just because of this policy.......well, people should read the fine print anytime they do anything online. If they don't want to be bothered with it, then they should book through a travel agent, and make plain that they want a room that is changeable and cancelable. As with any purchase, cheapest is not always the best, or the best value, and you do have to do your research to find the best fit for you and your situation.

[Loonbeam]

This specific policy aside, Amy makes a key point..

Quote..

But here's the worst part, in my opinion, fellow travelers: We have let the travel industry do this to us. Every time we go searching for the absolute rock-bottom rate, we will get what we pay for. Every time we forget to cancel a reservation and then swear to our credit-card company that we did cancel it and the hotel is lying, the hotels will find even more ways to protect themselves. Just as businesses must be responsible and ethical, so must consumers.

End Quote...


AMEN.

[Ned]

Amy, Aaron, Ann and John are absolutely right. This practice has been going on for years. The non-cancellation rate, is but one of the many rates available for rooms at some hotel/motel chains, like Holiday Inn Express.

Amy, you said,
But here's the worst part, in my opinion, fellow travelers: We have let the travel industry do this to us. Every time we go searching for the absolute rock-bottom rate, we will get what we pay for. Every time we forget to cancel a reservation and then swear to our credit-card company that we did cancel it and the hotel is lying, the hotels will find even more ways to protect themselves. Just as businesses must be responsible and ethical, so must consumers.

The next time you book online, please read the fine print, even if you have to go searching for it. Question everything, and then decide whether the risk of highly restricted hotel rates is worth the reward of saving a few bucks.I don't think we've let the travel industry to this to us. I think many travelers literally begged the industry for this, by strictly purchasing travel based solely on price.

About 100 BC, more than 2,100 years ago, Publilius Syrus wrote, "Everything is worth what its purchaser will pay for it." Then in the 20th century, it appears that William Randoph Hearst, in an editorial he penned in the San Francisco Examiner simplified it to "You get what you pay for." (His grammar was never the best.) I've said in the past, "Purchases 'on the cheap,' may be the most expensive purchases of all." Your friend Mary Ann certainly found this out.

I looked at the Holiday Inn Express web site. Forget fine print, they literally shout out that non-cancellable reservations have that restriction. Frankly, Mary Ann should have noticed that. I find no fault with Holiday Inn Express. I also find no fault with HIE for having that rate available for their rooms. I see nothing misleading about it. For people with rock solid plans who can only afford a minimal cost for a night in a room, this can be a great deal. I wouldn't touch it myself, but that's me.

I agree that every time someone doesn't cancel a reservation, but claims they did, hurts us all. It's fraud. It's stealing if they get their money back. It's no different than breaking something, or finding that it doesn't work, and calling the insurance company to make a claim by telling them it was stolen, or faking an injury in an auto accident to collect insurance money.

Your advice to read the fine print is, of course, wise, however, as John said, "people should read the fine print anytime they do anything online" or sign anything for that matter. If you don't read an agreement to which you consent or authorize, you're a fool. If you don't understand what you're reading you should walk away, or in the case of a web agreement, not push the "submit" button.

[Annette]

How is this different than purchasing anything from a store that's marked as "final sale" and then trying to return it? It's certainly not a practice that's unique to the travel industry.

[vacationagent]

I think many travelers literally begged the industry for this, by strictly purchasing travel based solely on price.


You've said it, Ned. If the suppliers (airlines, hotels, cruise lines, etc) would differentiate themselves on some basis other than price this wouldn't have happened. But if the public perceives the only difference to be price 1. Whose fault is that? and 2. Why wouldn't a purchaser purchase on price?

[Ned]

In the hotel market, save the low end market, the hotels have done all kinds of things to differentiate themselves beyond price.

Loyalty programs (many are very different)
fitness centers
location
bedding
internet (wired and wireless - free or fee based)
room size
free bottled water
coffee maker in room
refrigerator in room
jacuzzi in room
etc., etc., etc.In the airline industry, in my opinion, in the economy market, price rules at this point in time, but while it will always be important, who knows what the future might bring. The airlines might actually smarten up some day.

When it comes to hotels many of us make decisions based on many more factors than just price, although you can never ignore it, because it does count when you're trying to set a rooms value to you.

You've said it, Ned. If the suppliers (airlines, hotels, cruise lines, etc) would differentiate themselves on some basis other than price this wouldn't have happened. But if the public perceives the only difference to be price 1. Whose fault is that? and 2. Why wouldn't a purchaser purchase on price?

[amybhole]

Hey guys, long time no chat!

One thing to remember: Since the people who post here are the savviest of savvy travelers;), we sometimes forget that many people aren't. Many people don't read any fine print because finding the reading glasses is too hard, or miss that big red sign that says "final sale," or last booked a flight or hotel room in 2002 and don't realize that things have changed, or book a hotel room online as their first foray into the world of online shopping. Trust me, there are lots of them out there. My favorite mistake -- people would constantly show up at one of my hotels, and we couldn't find their reservation. But they had a confirmation number! And a print-out of their booking details! If only they hadn't booked their room at one of our other properties that was in another state! This happened nearly every day. So I do have to warn about the seemingly obvious. But c'mon, admit it, even the best travelers have had stupid moments when they've gotten screwed because they weren't paying enough attention to something.

But I promise, I only first noticed this policy less than two years ago. None of the hotel companies I've worked for ever had such policies. But I admittedly don't often book with chains or online, and it's been a long time since I've looked at Apollo/Sabre/Galileo listings. So I guess I'm not too with-it on this one. I guess it's just good practice for when my kids grow up and I'll try to be cool and act like I'm in-the-know, while all the while they'll just think I'm an idiot. Oh well.

I'm going to quote myself now, because the last sentence in the column is the most important point, and it can't be repeated enough:

"Question everything, and then decide whether the risk of highly restricted hotel rates is worth the reward of saving a few bucks."

[weblet]

"Question everything, and then decide whether the risk of highly restricted hotel rates is worth the reward of saving a few bucks."
The only thing I might change is to replace "hotel" with whatever method of travel you choose!

[tdew]

Hi everyone,

I know that Marriott has had this type of discounted room for quite a while now, but it's not one that I've ever booked, because there's no way you can predict what will happen.

I do have a question though - IF you booked this type of room as part of a trip and had travel insurance for the whole trip, would you be covered?

Terry

[bravestar]

Amy,

Good to see you about! I have to throw my own hat into the ring along with Ned, John and Co. They've already articulated my thoughts better than I could, so I won't repeat them here. I would like to respond to something you wrote in your post, however.

One thing to remember: Since the people who post here are the savviest of savvy travelers;), we sometimes forget that many people aren't. Many people don't read any fine print because finding the reading glasses is too hard, or miss that big red sign that says "final sale," or last booked a flight or hotel room in 2002 and don't realize that things have changed, or book a hotel room online as their first foray into the world of online shopping. ... But c'mon, admit it, even the best travelers have had stupid moments when they've gotten screwed because they weren't paying enough attention to something.

As buyers of things and services, each of us must be fully aware of what we're doing. Yes, there are companies out there that want to grab as much of your cash as they can before you realize what's happened, but I don't think Holiday Inn Express did it in this case.

When you bring up a list of an HIE's rates, the Advance Purchase section is right on top as it's the cheapest on the list. It's also the one the hotel wants you to select, because although they may lose a few dollars per night on the booking, they're -guaranteed- that revenue.

At this point, the buyer can click the words "Advance Purchase" and get information about the booking being inflexible. This information is also located within the room description link. When the buyer "selects" the room of their choice, they are presented with the form asking for identifying details (name, phone, payment information, etc.). This information is also on this page. In fact, it's on this page at least twice, and one of those times in red text.

To complete the online purchase, the buyer must check a box that indicates they've read the Terms & Conditions for that reservation on that page. They also must check a box indicating they accept those Terms & Conditions, and authorize the charge as described to their credit card.

HIE has obviously made efforts to make sure that the buyer is properly notified of the rate rules: in my example, they're available in four different places that I noticed. In addition, the buyer assumes responsibility for those by checking the boxes to complete the reservation.

What else do you expect HIE to do? No matter how many times the rate rules are listed and no matter where they're listed and no matter how they're listed, there's always going to be someone who ignores them; there's always going to be someone who doesn't understand them and makes the reservation anyway; and there's always going to be someone who simply doesn't want to bother.

If a potential hotel guest wants to book their reservation online, and can't be bothered to find their reading glasses (to quote an example of yours), they either shouldn't book online or should understand they accepted those conditions when the reservation was made and confirmed.

Why should the hotel, or any other business, have to accept a loss of revenue or lack of customer satisfaction because the buyer wasn't responsible enough to ensure they were purchasing the right product/service?

[bravestar]

Terry,

That all depends on the insurer. Most that I've seen state, for Trip Cancellation coverage, that it covers up to XX dollars in certain situations and for covered reasons.

In my opinion, you're knowingly selecting a non-refundable rate. If someone were to die and you couldn't honor the reservation, that's one thing. But if you covered yourself and simply don't want to stay at that hotel any longer, you should be held to the rate rules.

The individual insurer will make at call if/when a claim is filed. I would advise my clients to accept travel insurance if the possibility is there they would have to cancel the trip for a reason covered in the insurer's policy of coverage/terms & conditions. Even then, that's not a guarantee it will be covered.

Hi everyone,

I know that Marriott has had this type of discounted room for quite a while now, but it's not one that I've ever booked, because there's no way you can predict what will happen.

I do have a question though - IF you booked this type of room as part of a trip and had travel insurance for the whole trip, would you be covered?

Terry

[John225]

Bravo, Steve. And, if I may expound a bit.....if someone is too lazy to go and find their reading glasses, then they deserve what they get. One would think if they need reading glasses, they would need them to even begin the process of making a reservation on the internet. And, to dig up an old cliche, especially since the terms are posted in no less than 4 places, ignorance is no excuse.

Sorry, Amy, but I doubt your friend will find much sympathy from where I'm sitting. As I tell my clients when they say "what if I need to change" and "I might need to change", then break open the wallet and spend the extra dollars to get a rate that allows you to do it with no penalty.

[Ned]

Hey guys, long time no chat!

Happy to see you in the forums.

One thing to remember: Since the people who post here are the savviest of savvy travelers;), we sometimes forget that many people aren't. Many people don't read any fine print because finding the reading glasses is too hard, or miss that big red sign that says "final sale," or last booked a flight or hotel room in 2002 and don't realize that things have changed, or book a hotel room online as their first foray into the world of online shopping. Trust me, there are lots of them out there. My favorite mistake -- people would constantly show up at one of my hotels, and we couldn't find their reservation. But they had a confirmation number! And a print-out of their booking details! If only they hadn't booked their room at one of our other properties that was in another state! This happened nearly every day. So I do have to warn about the seemingly obvious. But c'mon, admit it, even the best travelers have had stupid moments when they've gotten screwed because they weren't paying enough attention to something...

I certainly agree that many of our members or highly experienced travelers or travel pros. I've got to say though that I'm not at all sympathetic to someone who's spending hundreds or thousands of dollars and doesn't read the terms of their purchase, or carefully review the purchase before pushing that final submit button, and then to top it off, ignores the email confirmation they got for the online ticket purchase until a day or two before the trip is to commence, only to find either they goofed or the hotel or airline.

I know there are plenty of people like that. I have a client who's server was acting up today. I shot out to fix it. It took about an hour or so and it's working fine now. Meanwhile, he knows about our Forums, and that I'm an experienced traveler who regularly participates in the discussions here, and he has occasionally been on them. He's an executive in his company, and he told me he's flying on business Friday, and he just noticed he bought tickets for the wrong city. He wanted to know what he could do. I asked him if he double checked his reservation before he clicked on the purchase button, and he assures me he did (oh yeah). I asked him if he checked his email confirmation of the purchase, and he said he never bothers, and usually just deletes them. What a fool!

OK, plenty of people are fools about this, but that doesn't mean they have my sympathy, or that I think the airlines or hotels should give them a break. If you're inexperienced in purchasing online, or inexperienced in booking travel yourself, I figure that you know that's true about yourself, and therefore, you should be even more careful about booking than the experienced traveler, and daily Internet shopper. It's just not an excuse I accept.

...I'm going to quote myself now, because the last sentence in the column is the most important point, and it can't be repeated enough:

"Question everything, and then decide whether the risk of highly restricted hotel rates is worth the reward of saving a few bucks."


To this I can only say, "Amen."

[amybhole]

Don't forget, guys, I didn't have any sympathy for her either! She's probably still smarting a little fom the tongue lashing I gave her!

It's not that I think hotels should refund the money for people like my friend. It's that I think they shouldn't have such policies in the first place. We get aggravated enough when they "nickel and dime" us with silly resort fees. Hundreds of dollars lost over a cancellation is far beyond nickel and diming, and unless the hotel can't resell the room, it's uneccesary. It's double dipping, and it's legal, and it's disclosed, but it's also a really crappy way to treat your customers.

Hotels have had record rates and occupancy for a few years now, and they've been able to treat customers poorly as a result. With a looming recession, however, things may change. If occupancy and revenue drops because people stop traveling, hotels may have to go back to the good ol' days of being nice and fair in order to gain business.

[jimtbay]

It's not that I think hotels should refund the money for people like my friend. It's that I think they shouldn't have such policies in the first place. We get aggravated enough when they "nickel and dime" us with silly resort fees. Hundreds of dollars lost over a cancellation is far beyond nickel and diming, and unless the hotel can't resell the room, it's uneccesary. It's double dipping, and it's legal, and it's disclosed, but it's also a really crappy way to treat your customers.

Hotels have had record rates and occupancy for a few years now, and they've been able to treat customers poorly as a result. With a looming recession, however, things may change. If occupancy and revenue drops because people stop traveling, hotels may have to go back to the good ol' days of being nice and fair in order to gain business.


I think that blanket statement on the state of customer service in the hotel industry related to a fully disclosed rate rule is off center. I am in a resort, you pay 50% up front, the balance at check in. Fully disclosed at reservation time the cancellation rules and the penalties. We have a low cancellation rate because of it and do not over book. Very few issues.

Does customer service mean that the hotel, or what ever entity, has to give in to the customer because they do not follow the rules?

Customer service is providing the service as agreed upon, and then exceeding those expectations. That is how you gain loyalty and build a brand.

I do not see a customer service issue here, I see a guest trying to get out of an agreement.

[the dark knight]

I say that it never is worth that small savings to lose the ability to cancel with no or little penalty before the cancel deadline(for a good reason). Though I see those rates all the time, online and in the computer, I will not book these nonrefundable "hot deal" or web-only rates for that reason alone. I don't even mention them. Not worth the risk.
Hotels, like any other travel vendor is all about getting the revenue. Though most (major) hotels are usually understanding when things happen and people cancel a room, there are exceptions to this, especially with smaller independent properties.
I have had clients get charged for a $300 room at a luxury hotel because the hotel wouldn't budge, though the city where the hotel had just gotten two feet of snow, the airport was virtually shut down and the traveler could not get there. The hotel knew this, and didn't care. The manager said as much. Crazy...and unfair!

[deangreenhoe]

Does customer service mean that the hotel, or what ever entity, has to give in to the customer because they do not follow the rules?

Customer service is providing the service as agreed upon, and then exceeding those expectations. That is how you gain loyalty and build a brand.

I do not see a customer service issue here, I see a guest trying to get out of an agreement.

I understand your side of it completely, Jim, being on the front lines between the consumer and the vendor with these issues. I'm forced over and over to respond to requests from a customer who expects the rules to bend for them, even if they've acknowledged the terms of the reservation/sale. It gets extremely frustrating.

I think that's just the way things are now. It's an ongoing battle between the often times lazy or careless consumer and the vendors who feel compelled to enforce certain booking policies in order to protect their financial interests in this sort of service market.

Honestly, it's a rare occasion that a traveler has to cancel a booking of any kind that has a pre-disclosed penalty for doing so that they don't ask me, "so how do I get out of it?" It's an annoying part of human nature. :rolleyes:

[vacationagent]

In the hotel market, save the low end market, the hotels have done all kinds of things to differentiate themselves beyond price.

Loyalty programs (many are very different)
fitness centers
location
bedding
internet (wired and wireless - free or fee based)
room size
free bottled water
coffee maker in room
refrigerator in room
jacuzzi in room
etc., etc., etc.In the airline industry, in my opinion, in the economy market, price rules at this point in time, but while it will always be important, who knows what the future might bring. The airlines might actually smarten up some day.

When it comes to hotels many of us make decisions based on many more factors than just price, although you can never ignore it, because it does count when you're trying to set a rooms value to you.
I was agreeing with you, Ned. However, there's "amenity creep" even in limited service hotels. And what Amy's article was about was a reduced rate room within Hotel A - not a rate disparity between 2 hotels. A city hotel won't have very many room categories - if the difference is low price/restrictions or high price/no restrictions, the potential guest needs to be familiar with the restrictions.