A disturbing trend?

In travel, everything is fluid.  Deals come and go and the same is true with benefits and terms of travel.  It appears Marriott (and their new corporate cousin, Starwood, following the recent merger) is attempting to institute a sea change in travel reservations and how the public responds will likely determine whether it catches on with the rest of the hospitality industry.

Already, with very little fan fare, Marriott is now requiring up to 3 days advance notice for a penalty fee cancellation of a hotel reservation.  This is up dramatically from the now typical 1 days notice (many hotels still currently allow cancellation up to 6pm local time the day of the reserved stay).   Increasing that for both business  and leisure travelers will have a dramatic impact on how reservations are made, kept and cancelled.  A quick check of recent “cancellable” rates shows many North American properties for both Marriott and ex-Starwood properties are requiring anywhere from 48 to 72 hours advance notice for those rates.

2 Day advance cancellation now needed
2 Day advance cancellation now needed

Most players in the travel industry tend to copy (for better or worse) what their competitors do.  For years, one airline would attempt to put through a fare increase and then they would wait to see if the competition matched the increase and got it to stick or not.  The same thing often plays out in reverse as well, with travel sales.  Likewise, airlines, hotels, and car rental agencies all monitor policies like this to see if they can move the needle on the “industry standard.”  For instance, at one time, all airlines afforded you an allowance for checked baggage.  However, in 2008, American Airlines was the first airline to charge a fee for a checked bag.  Eventually, the other primary carriers copied and adopted the same approach and it stuck. (Note: As is well advertised, Southwest Airlines does not charge for the first two checked bags).  The same could occur with this change.  If Marriott successfully pioneers a two or three day requirement for hotel reservations being cancelled, we could easily see IHG, Hyatt, Hilton, Best Western, etc. adopt a similar tact.  Conversely, if Marriott/SPG’s experiment goes awry, we could see the approach equally abandoned.  We also might see other chains promote the fact that you don’t have to give such advance notice to cancel a rate in an effort to gain market share.

Keep your eyes on the trend to see how it develops, but at first glance this obviously seems to be negative for the customer.  However, the silver lining is that this theoretically should allow for hotels to better manage their occupancy and allow guests to gain access to rooms which now are simply being cancelled closer in to the actual stay date, thereby offering other customers to gain access to the rooms.

Let’s see what happens.