How to Beat the New 48 Hour Cancellation Policies

 

Keep Saying No to the New 48 Hour Cancellation Policies

 

By Robert McGarvey

 

File this story under how to win.

We all know that Marriott and now Hilton are seeking to impose a 48 hour cancellation requirement. Fail to cancel earlier and you will be subject to a penalty of one night’s rate, say the big chains.

I have been vocal in opposing these policies, as has Joe Brancatelli, and most other business travel experts.

Marriott and Hilton are trying to tell us these cancellation policies are for our benefit, that they will help ensure that rooms are there when we need them.

As Brancatelli howled in a recent column: “Hilton is lying. Marriott is lying.”

Now Intercontinental Hotels has entered the fray with a new 24-hour cancellation policy.  Obviously that’s half as bad as the 48 hour rule – but, really now, who has made reservations at a Holiday Inn? I’ve stayed at many but not with a rez.

So that’s easy enough to ignore.

The reality is this: if we stand against these policies we will prevail.

Read this from Business Travel News: “It remains to be seen how the new cancellation policies will impact corporates. Even with the 24-hour policies that launched in 2014, buyers have been able to secure same-day cancellation contract terms and dissolve relationships with properties that wouldn’t accept same-day cancels.”

What that is suggesting is that the large corporate and government buyers will insist on striking the 48 hour clause and the hotel chains – no surprise – will cave.

The BTN story continued: “Goldspring Consulting partner Mark Williams said even with the size of Marriott and Hilton, he expects that the high fragmentation in the hotel space will keep the 48-hour cancellation policy from becoming a broad industry practice.”

Absolutely right.

Hotels in cities popular with business travelers would do well to build a flexible cancellation policy into their marketing plans.

Will that hurt them? BTN reports that 4.9% of corporate travelers cancel within 48 hours and that just isn’t that big of a deal.

Know you won’t sleep on a hard plastic airport seat if you choose to boycott Marriott and Hilton. It simply is very rare that even popular big cities – Manhattan, San Francisco – sell out.  New York has the nation’s highest occupancy rate and that is 85%.  Nationwide, occupancy is 65% – and that means on any given night one hotel room in three is vacant.

And most rooms still are at hotels without punitive cancellation policies.

Add in available Airbnb and Homeaway accommodations and the math is on our side.

Add in HotelTonight – which has always had rooms available whenever I’ve checked – and there is every reason for confidence.

I understand the hotelier envy that the big airlines have us whipped when it comes to cancellation fees – but on most routes I may have just two or three options.

Hoteliers just don’t have that degree of power.

In central Phoenix, I have probably 20 nearby hotels and about 75% are not in the Marriott or Hilton constellations.

I don’t recall staying at either on trips to New York.  I can live well without Marriott or Hilton. Or Intercontinental.

You like them? Fair enough. So be Machiavellian, book into a Hilton or Marriott for your next business trip and, at the 49 hour mark, if you have any doubt you will in fact go on the trip, cancel the rez. Without penalty.

Come up with two or three alternative places to bunk – just to keep your blood pressure down.  A glance at HotelTonight should provide that info.

But my guess is that on the day of travel, if you are still going, call that Marriott or Hilton and odds are very high they will have a room for you.

The math is on our side.

That’s what the hoteliers just aren’t getting.  The math – those high vacancy rates – says that if we change our booking habits and accept a tiny bit of uncertainty we can tell the big chains to shove it.

We can even have our cake and eat it too, by making same day reservations at the chains.  And if you do that, always ask for a discount.  If you don’t book it, that room likely will stay empty. Remind them of that reality.

The math definitely is on our side.

 

4 Comments

    • Actually, Stan, if you call the hotel directly, they’ll often become very flexible if they can sell a room that could otherwise go empty/unsold.

      Sure, YMMV (your mileage may vary). If it’s a peak period in town, prices may be at a premium — but they already were, even if you booked months ahead of time. Revenue is revenue, and if you dangle that carrot before a LOCAL hotel rep, they’re very likely to nibble.

  1. How about hotels that have a “no cancellation” policy unless you reserve a more expensive room? It happened to us and we had to pay over 300 euros for a room we never used!

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