Published on Wednesday, November 21, 2007

Bookers use 'tariff-busting' to get revenge on hotels

Accommodation bookers are "getting their own back" on hotels by using new ways to cut the cost of rooms, according to Supranational Hotels managing director.

Niels Pedersen, who heads up the 1,500-strong hotel marketing and representation group, believes bookers are getting revenge on hotels which charge hugely different prices for the same standard of room on the same day.

He believes increasing numbers of bookers in most European and Nordic countries are becoming obsessed with ‘tariff-busting’.

“Many have learned simple tricks like avoiding an headquarters conference hotel with its official marked-up prices, or to use those web services or trade consortia where lower rates have been agreed and fixed further ahead,” he explained.

“Others call hotels direct and pretend to be eligible for the corporate rate of a locally important or a world-famous company, and some target airport hotels as being ‘softer’ and the easiest to bargain with.

“The fastest-growing ruse is to cancel a reserved room near the arrival date at no-penalty in order to immediately re-book at a lower displayed rate. Probably 10% of cancellations are now occurring for this reason.

He said rate-hagglers also identify the advance booking pattern in hotels across an entire city in order to accurately predict those dates with most availability and therefore likely negotiability.

“These would-be price-cutters are not doing it to save £5 a room, but are aiming for £50,” he added.

“Their motive is almost that of revenge – to get back at hotels where they know hugely different prices are charged for precisely the same standard of room on the same day, a practice which leaves a sense of having been cheated."

He advised the hotel industry to minimise the range of tariffs within the dynamic pricing model and to always give preference to regulars for the cheapest rooms whenever they book.

“In addition, because revenue managers tend to change jobs every couple of years they should ensure that they have deputies who also know the traditional booking sources and patterns and so can avoid alienating large numbers of repeat guests.”

By Bev Fearis

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