Yes, airlines can do something right

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If you think the airline industry doesn’t do anything right, think again.

A few weeks ago, Brian Crummy had to pay for the same night twice at two different hotels.

The reason: His plans changed, and the rate he’d booked was completely non-refundable and non-changeable, even when he waved his diamond elite card at the receptionist.

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“They would not budge,” says Crummy, a sales manager from Gilbert, Ariz. “I feel like the hotels bank on me taking the advance-purchase rate to save money, in hopes that my plans change and they can cash in.”

Are airlines any better? Well, kinda.

Had Crummy changed his mind within 24 hours of making his reservation, he could have received a full refund on his airline ticket, as long as it was a week or more before his departure.

Even if it wasn’t, he could have asked for — and received — a ticket credit, minus a $200 change fee.

I know, I know. Not the fairest comparison.

True, many hotels still offer customer-friendly policies, including the ability to cancel a room without penalty, often until 6 p.m. on the day of arrival.

But times are changing. The 6 p.m. deadline is sliding up to 4 p.m. for a lot of hotels, and budget properties are offering modest discounts in exchange for the room being completely non-refundable, often with poor dis-closure.

The result: I’m being inundated by complaints from readers who say hotels aren’t playing fair. They want them to be more like airlines, in a limited way. For a non-refundable stay, should hotels offer a courtesy cancellation window and a room credit, when plans change?

Of course they should.

Why don’t they? The hotel argues that allowing any of these practices would cost it money, and it almost certainly would. The way a hotel sees it, it’s offering a discount of up to 20% in exchange for making your room completely non-refundable. In exchange, guests accept the risk that their plans might change and that they will forfeit the entire room charge.

“I don’t think it’s fair for the customer to have it both ways,” says Glenn Haussman, editor in chief of Hotel Interactive, a hotel industry trade publication.

“They have a choice allowing them to cancel up to the same day in many cases, and by offering a credit, for example, the industry is just asking for customers to always book rooms at lower rates, which, in turn, would erode industry profits.”

That may be accurate, but airlines used the same argument — that allowing a cancellation within a day of making a booking would hurt earnings — before the Transportation Department in 2011 imposed the 24-hour rule. Since then, industry profits have soared.

How about a room credit? Should a hotel just be able to keep all your money, as it did for Crummy, especially if his accommodations can be resold?

Not every room can be rebooked, particularly for resorts in remote locations or that have long lengths of stays or during the week of a festival, for example.

“There may not be pickups of one-week reservations and around special events,” notes Bjorn Hanson, a professor at NYU’s Tisch Center for Hospitality, Tourism, and Sports Management. It seems right for a hotel to protect itself from any losses.

But if the room is resold, why not? Pocketing all a guest’s money seems wrong to many travelers.

Even if hotels wanted to do it that way, how would anyone go about verifying whether a room was resold? You’d have to take a hotel’s word for it that it did, or didn’t. No, that wouldn’t work. A room credit makes more sense.

“As non-refundable rooms become more prevalent, and I think they will, hotels will more than likely adopt policies such as offering rebooking opportunities for a fee or a 24-hour grace period for canceling a non-refundable booking,” says Stephen Barth, hospitality law professor at the Univer-sity of Houston.

That would be good news. Now, if we could only get airlines to be more like hotels — wouldn’t that be something?

Which industry has the most customer-friendly policies?

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How do you avoid getting stuck with a non-refundable hotel rate?

Look before you book. Many discount chains will give priority to these non-refundable rates on their websites, even when the discounts are negligible. Be sure to read the fine print in the terms before booking.

Consider travel insurance. An insurance policy can cover you if you need to cancel your trip. But significant restrictions apply. Consult your policy before making a claim.

Haggle if you can. Hotels are nowhere near as rigid with their rules as airlines, and a brief, polite e-mail to a manager or to the hotel chain’s headquarters can yield a room credit, if not a refund.

54 thoughts on “Yes, airlines can do something right

  1. Overall, hotels have far more customer friendly policies than airlines. The fact that refundable rates are rarely multiple times the cost of the non-refundable rate is the single biggest one. Further, airlines merely promise to get you from point A to point B, within a certain window. Few hotels would make such a disclaimer.

    1. Unfortunately, hotels are learning from airlines. Right now the non-refundable rates are only a small percentage discounted from the standard advance rates. But if the hotel business is as successful at making the whole non-refundability scam stick as airlines have, I know right away what’s going to happen: suddenly the standard advance-purchase rates will start to disappear, and non-refundability will be the only game in town.

      1. I’m guardedly optimistic that we’re not headed towards that scenario. My reasons are, in no particular order

        1. Meaningful competition
        2. Greater level of consumer knowledge
        3. Ease of offering multiple tiers of service

        I would opine that that’s why of the most commonly used parts of the travel industry, air, lodging, rental cars, the hotel and rental cars have far more customer friendly policies overall.

  2. I see the hotel’s reasoning, up to a certain point. But I think some sort of cancellation window should be offered. The way things are now, if I fat-finger the date and don’t see it until I check the printout five minutes later, I’m pretty much screwed. Is that fair, considering that if a hotel fat-fingers their rate and offers a room for $19 instead of $91, they’re probably going to refuse to honor it.

    1. you can’t have it both ways, either a cheap non-refundable rate or high fully refundable. Can’t have your cake & eat it too !!!!!!!!!!!!!!!

      1. That’ may be true with airlines, but certainly not necessarily true with hotels. Just for grins and giggles, I checked the rates for the hotel that I might be staying at on my next trip. The attorney rate is $313. That rate is fully changeable, refundable, etc. By contract the prepaid, non-refundable rate is $299. That’s less than a 5% savings. It will be silly to book that rate unless you are siting in the lobby.

        And of course, the fully refundable AAA is only $230. That’s less than the prepaid rate.

          1. That’s hardly true, nor necessarily prudent.

            Like anything else, it depends on any number of factors, including your needs and circumstances. Most of my family works for the government. The rates that they get at high end hotels are almost criminal. And usually there is no requirement that it be on government business. Corporate rates can also be substantially cheaper than others.

            Booking with wholesalers brings certain problems, not the least of which is that extra hands increase the chance of errors. That’s particularly onerous as there is also that additional layer of mutual deniability between the wholesaler and the travel provider. The other problem is that, as TonyA articulated, wholesaler contract rates tend to be fairly restrictive, e.g. nonrefundable and nonchangeable; neither of which works for business travel.

            My law school roommate did that and he was stuck in Switzerland. He had to buy a one way,walk up ticket to Los Angeles. Not cheap, especially for a student. It took him months to get a partial refund from the wholesaler.

            When I’m traveling on business, I don’t have time nor inclination to mess around to potentially save a couple of dollars. I’m not jeopardizing my performance in court or otherwise representing my client.

            Actually, even on vacation, I want to avoid unnecessary drama. Booking with a wholesaler seems like an invitation to unnecessary drama..

          2. no contract rates are often 1/2 the best rate you’ll get directly from a hotel & work best for stays of over 2 nights generally & even better for longer stays.

          3. Even if the 1/2 off is accurate, something I doubt is generally true, none of that addresses any of the other issues. A wholesale contract rate is generally nonchangeable and nonrefundable. That has to be a condition that you are willing to accept. That pretty much excludes any business travel and quite frankly me.

            You also understand that if there is a glitch, your ability to resolve the issue easily is substantially reduced. A business person traveling needs to be focused on the matters at hand and should generally strive to reduce “unnecessary drama”

            I would be very upset if someone who worked for me acted penny-wise and pound foolish.

          4. as stated 90% of business travellers on fully flexible air tickets don’t chnage their flights. Same with accom. Giving one off examples is totally meaningless.

          5. I don’t believe I gave any examples, one off or otherwise, in my last post. I gave two specific broad issues, the second of which you glossed over. I would also challenge the notion that 90% of business travelers on fully flex tickets don’t change their flight. What is your substantiation for that number. I would also point out that we were discussing hotels not flights in the last posts, specifically,

            never ever book directly with a hotel !!!

            Best rates are always contract rates with wholesalers !!!

          6. Replying to my own post is a bit dodgy, but we must also consider:

            If your business flight is last minute, then you’re buying a flexible ticket regardless as you’ve likely missed the cheap rates already. Obviously the closer in time the ticket purchase, the higher likelihood of using it as originally planned. But since the flex ticket wasn’t a choice, that’s not the discussion.

            The question is when travelers have a choice whether to buy a restricted ticket or a flexible ticket, when is it the best practice to buy the flexible ticket.

          7. So what? Many people buy options to hedge their portfolios and many buy insurance. Guess who gets bumped first on an oversold flight?

          8. As recounted on this site, travelers seem to have a lot more problems with online wholesalers than with direct bookings. There does seem to be a trend, though, to hotels that can only be booked through those OTA sites that we have learned to try to avoid.

          9. What does that say about that particular hotel?
            When you give the OTA a 25 to 35% minimum discount below the Best Available Rate, guarantee parity and last room availability, you have sold out to the devil. Good luck to the guests expecting hospitality.

          10. who said anything about online wholesalers ?

            Online gives a convenient comparison for both air & hotels, but virtually never cheapest.

            A good travel agent can access both airfare & hotel rates that can’t even be found online.

            We fly to USA a lot & often fly one airline over & different airline back & much cheaper than offered flying either airline both ways, especially at peak times like Xmas (Australians have 6-8 weeks holidays over Dec-Jan period – we don’t like working)

  3. ““They would not budge,” says Crummy, a sales manager from Gilbert, Ariz.
    “I feel like the hotels bank on me taking the advance-purchase rate to
    save money, in hopes that my plans change and they can cash in.”

    Yes, duh. And consumers bank on the lower rate, hoping their plans won’t change and they can cash in.

  4. Hey how come this article is missing or not seen at the home page? Without looking at the right side bar on What’s everybody talking about, I would not have even known the article existed.

      1. When I go to elliott (dot) org, I see yesterdays Expedia story. When I go to www (dot) elliot (dot) org, I see this story with the new design.

        1. Exactly! Thanks.
          (1) elliott dot org shows the Latest Stories (new design)
          (2) http www elliott dot org goes to yesterday’s story (Expedia)
          and does not show the latest story

          1. elliott dot org — (Cloud Fare)
            http www dot elliott dot org — (hit-servfail-opendns dot com)
            This means the latter is not resolving correctly or as intended.

            Added: I was using Firefox when I saw the problem.

          2. Interesting using Chrome (ISP=Cablevision NY/CT) I get the new site for all elliott addrresses http or www or just elliott dot org.

          3. Does anyone else using Google Chrome find that they can’t vote on Chris’ question? I can’t and it has been driving me crazy. I also have Firefox on my computer and it does allow me to vote. However, Firefox does not display reader comments. I wish that I had one browser that would allow me full access to these pages.

          4. In order to view comments using Firefox, I had to restart firefox in safe mode. Now they appear. Irritating, but a usable workaround 🙂

        1. Oops spoke too soon … and cleared my history, cache , cookies, etc.

          Using firefox. Elliott dot org takes me to yesterday’s story.
          Putting a www infront of elliott dot org takes me to the new site which has today’s article.

      2. Like @mikegun:disqus, I use Chrome (with AdBlock). elliott dot org brings me to Expedia story from yesterday. www dot elliott dot org brings me right back to the Expedia story from yesterday. I only was able to navigate to this page by clicking on the link with the comments on the sidebar. BTW, thanks for bringing that back!

        Today’s story seems very familiar. Maybe I read it on Facebook, where you post stories that you’ve published in other venues?

          1. Cleared my cache. Now…elliott (dot) org works fine, www (dot) elliott (dot) org takes me to yesterday’s.

          2. Spoke too soon. Goofy again. Don’t have much time to spend here today, anyway, so maybe it’s a blessing in disguise?

  5. When hotel rooms become so small that the beds no longer fit, then they’ll be as bad as airplanes.

    (And, yes, hotels in London are coming close to that.)

    1. Not just London!

      I had a room in Vienna where there was barely enough room for the bed. There was only half a window in the room. The other half was in the room next door. The bath room was so small you could not sit straight on the toilet. There was literally 6 inches of space between the front of the toilet and the wall so you have to sit sideways to fit in.

    2. In fairness. I assume that’s not a recent development, but has always been. Sounds more like making do with what you have rather than decreasing the size of the room, the way airlines purposely decrease seat pitch.

    3. We stayed at a lovely hotel in New Orleans in October, where our friends (for the same rate as ours) had a huge room with a separate sitting room, large 4 poster bed, etc… Our room on the other hand, was so small, my husband could, quite literally, lay in bed and reach over and open and close the bathroom door! Fortunately, who spends a lot of time in a hotel room in N’Ahwlins????

    4. European hotel rooms are generally smaller than American for a variety of reasons. It’s not a grand plot, just the way it’s always been. You have to lower those expectations.

  6. This article provides extremes for both industries. Neither one is better than the other in the provided examples.

    The only difference is the airlines do allow the funds remaining from your purchase after the change fee is subtracted (if any) to be used to purchase another trip which makes them slightly better than hotels which have non-transferable as well as non refundable restrictions on their reservations. Hotels are better because a refundable reservation is only a few dollars more than the non refundable one which is better than the multiple times the cost for a refundable air fare. Both industries work within the applicable laws and neither do more for the customer than legally required.

    I have never booked a room or airfare or rental car where the refund ability was not clearly and even boldly indicated while booking. What part of “this reservation is non-refundable and the total amount will be immediately charged to your credit card” or similar wording which I see whenever making any kind of non-refundable reservation is poor disclosure?

  7. Many hotels are now going to a “you may cancel 24 hours in advance of check-in” for a refundable reservation. That said, I checked, “Hotels.”

    Last October, I was on a road trip across country, traveling with a friend. I always pay the nominal higher rate to be able to cancel my room. However, in this case, we were planning our route as we went. Even so, I booked a refundable rate at the Hampton Inn in Jackson, WY the night before we were supposed to arrive there, and too late to cancel without losing our money. Well, it turned out we had to spend the day having car repairs in Sheridan. Because of that, we changed our route west.

    When I went online to cancel, I saw that I had received an advance welcome letter from the manager, perhaps because I am a Hilton Gold. It was the first pre-stay letter I had ever received. After doing a formal cancellation and receiving a cancellation number, I responded to the manager’s letter with a thank you and an apology that we had to cancel and change our route, especially since this was my first Hilton welcome letter. I told him to keep up the good work.

    I did not ask not to be charged. I fully expected to be charged. However, I was not charged for the room in spite of my late cancellation. I wish I had the opportunity to go that way again to give that hotel the business, but it doesn’t look like I will.

  8. OK back to the article (I’ll stop bitching about the bug).
    If there is anything this article is saying – it is that it is safer to buy a ticket direct from the airline because the law requires them to have a 24 hour free refund or hold policy if you buy a ticket at least 7 days before departure.
    What this article does not tell you (but you should really know) is that you do not get the same protection if you buy your ticket from an OTA or even an ASTA travel agency. You are at the mercy of the travel agency to agree to void your ticket. Agencies are exempted from this law.

    A similar crazy situation exists with hotel rooms. Most OTAs and wholesalers really only offer PREPAID NONREFUNDABLE bookings. Many human travel agents do the same – they sell prepaid deals (they even can mark up these rates) from their “favorite” consortium. In exchange for a “discount” you lose the ability to refund (or cancel without penalties). But this does not have to be the case when you book directly with the hotel as most hotels offer rates with penalty- free cancellation.
    You want to know why many human travel agents don’t care to offer them (post paid) or charge you a booking fee if you insist to book a post paid rate?
    Because it is difficult to collect a commission for POST PAID hotel rooms. So many travel agents prefer to sell a prepaid hotel room (with a voucher) since they will get paid immediately by the wholesaler or simply pocket the markup.
    I wonder why Elliott does not us more about the whole story? There’s lot of things that stink in travel distribution. Protect yourself 🙂

    1. In fairness to Chris, he may not be privvy to the inner workings of travel agencies. But I agree with you, I’m a DIYer and proud of it. I book directly with the airlines and hotel and it’s worked very well for me, including taking advantage of cancellation policies.

  9. want a deal, pay for it & don’t whinge.

    There are now as many rates at hotels as airlines in economy/coach.

    It’s called yield management.

    One that aircraft door closes/hotel night passes those empty seats/beds aren’t worth anything.

    Like airlines, many idiots pay for very expensive fully flexible tickets & over 90% of these are never ever changed.

    So what these people should do if they want to save their money or their companies or the public service, is to buy the cheapest tickets they can & when they must change either forfeit the cheap ticket(& buy a new one, no matter what the price) or pay the change fee.

    1. As one of those idiots, I can assure you that that’s simply not a correct statement. We purchase expensive tickets because that’s usually all that’s available at the last minute. If your business travel tends to be either last minute or dynamic, it often makes better sense to purchase a changeable ticket to maximize your efficiency

      When I do business travel, I cannot be worried about losing the value of my ticket because court took too long, or a meeting was postponed or cancelled, etc. I remember recently changing a ticket 4 times.

    2. If you mean “90% of fully flexible leisure tickets … are never ever changed” then I might agree with you. Otherwise, the average business traveler changes their fully refundable tickets quite often(at least those in the US do). That’s why they buy them and also because many business trips are last minute bookings where no other option is available.

      1. no that’s the con. Airlines know it, but aren’t going to advertise it.

        Did some work for a smaller airline recently, who were amazed at how infrequently business types changed their flights, even though on fully flexible expensive tickets.

        They buy them, because they “think they are important”.

        Should distinguish between business owners who effectively pay their own fares & those on someone else’s dime & public servants.

        The latter 2, tend to swan around airport lounges, eating & drinking FREE (all drinks are free in Australian airline lounges) for hours, as they can get away with it.

        BTW-in Australia you can still often buy cheaper tickets as long as outside 24 hours before departure.

        Who plans a business trip less than 24 hours out ? Not that many. Who’s slack (when someone else is paying) & books their flights inside 24 hours, is the real question.

        Since GFC many corporates have tightened up their airfare purchasing policies, eg. no business/1st class or buy cheapest non-flexible tickets available at time. This is hurting the big inefficient airlines.

        That said, many seasoned travellers realise that once in an airline lounge, you can often get on an earlier flight, by simply being nice to the person at the desk, no matter how cheap your ticket.

        We often travel busy routes like SYD/MEL & SYD/BNE (some of the busiest in the world) on frequent flyer tickets & might be booked on an 1800 flight, but arrive at lounge at 1600 & person at desk in lounge with put us on earlier flight (at that time of day, they go every 1/2 hour).

        This is not a passenger change, but airlines may as well fill the earlier flight, esp in peak hour as later flights may be delayed.

        We have massive airline congestion at our busiest airlines. ie. SYD is a mess & BNE is not much better.

  10. I agree with Mr. Farrow’s comments preceding mine. I admit I haven’t had to fly much at all in the last 4 years but I have to use hotels and when I call to book, I use discount bookers but I still call the hotel and ask for an email or fax of their most recent policies. You can’t always go by what may be posted on their sites as things do tend to change but don’t always get updated on all their marketing venues and of course, they, like all businesses have that save their ass clause that they are not responsible for third party disclosure failings. But when I was using both services on a frequent basis, I never got bumped from a hotel room but I did on my flight. On an airplane you don’t always get to change a seating location, in a hotel if they have space available, it is never a problem. I have always been able to say to a hotel, uh, I am lost and won’t make my room tonight what can we do. Oh don’t worry Mr. Bxxxxxx,
    I have a load of folks looking for a room tonight, I can fill it, see you tomorrow. You see, I don’t deal with the big chains, I stick to the small Ma & Pa Kettle hotels/motels, you get a lot more done that way. Airlines and corporate chains you don’t mean crap. In one circumstance though, my wife and I were way-laid and missed our flight totally. I remember now, it was AMR parent of American Airlines. I called every SOB including the chief of the custodians and no-one would work with me. So I sat down and wrote an old fashioned letter and sent it to the then CEO of American. In three weeks, I received a full refund of our flight, a short but very courteous HSTLTR from the CEO and a promise of 10% off our next flight (-) taxes and bag fees. Believe it or not, writing a letter which use to be a way of life in this country not too long ago is now considered by many to be the ultimate show of commitment and truth and for me, in that isolated incident it worked.

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