Post last updated July 6, 2017
Marriott’s new 48-hour cancellation policy for all properties in the Americas creates immediate pain for business travelers. And the pain is likely to spread to corporate travel buyers when they negotiate new deals with hoteliers.
Hotel expert Marwan Batrouni, senior director and practice area leader for business travel consultancy Advito, said Marriott’s move is an effort to maximize revenue by making more rooms available for last-minute bookings. It follows a trend; many hoteliers have changed from same-day to 24-hour cancellations in recent years. But Marriott, emboldened by its Starwood acquisition, is breaking new ground.
The big question: Will other hoteliers follow suit? Expect competing chains to move toward 48-hour cancellations, Batrouni said, “although maybe not right away as they try to leverage a competitive advantage.”
Marriott’s new policy won’t have an impact on existing corporate hotel agreements. But it’s likely to affect the negotiation process for 2018. Here’s Batrouni advice for travel buyers:
- Assess your existing hotel program to understand current cancellation policies for preferred Marriott properties, as well as other hoteliers’ preferred properties.
- Ask your hotel suppliers about their plans for 2018. Are they going to follow Marriott’s 48-hour cancellation plan or compete against it?
- Do the math before you begin negotiating with hotel suppliers. What percentage of your existing preferred properties have same-day cancellation vs. 24-hour (or more)?
- Before you begin the request for proposal process, clearly explain to hoteliers that you want same-day cancellation. Bring up the issue in pre-RFP conversations, as well as in the cover letter you provide with your RFP.
- Be assertive during negotiations. Let suppliers know that your travelers need preferred hotels to accommodate their inevitable last-minute travel changes.
“Contracted corporate client rates have always had their own hotel cancellation policies,” Batrouni said. “Corporate buyers will just need to negotiate them more aggressively to ensure the flexibility that is so important to business travelers.”
Get prepped: Attend hotel sessions at GBTA
You’ll get more expert advice for hotel program improvements at the upcoming Global Business Travel Association conference, July 15-19 in Boston. Be sure to check out these sessions:
Hotel Trending Topics
Sponsored by BCD Travel
July 17 | 8:30-9:45 a.m.
Leveraging Data for Mobility, Risk Management and Cost Control Purposes
Lexi Honohan, Senior Director Global Business Strategy & Solutions, Advito
July 17| 8:30-9:30 a.m.
Going Global and Staying Safe with Shared Economy Accommodation Services
Kathy Bedell, Senior Vice President, BCD Travel
July 18 | 8-9 a.m.
Want strategies for increasing both traveler satisfaction and savings? Check out the latest Advito Industry Forecast Update. Learn more about how to improve your hotel program at bcdtravel.com/hotels.