â€œIf itâ€™s one call from a regular guest who has to cancel at the last minute because of extenuating circumstances, thatâ€™s not a problem,â€ Rauch said. â€œOur goal is to protect and grow our revenue. But at the same time, we have no desire to have guests hate us. The last thing we want is for someone to badmouth us on social media because of how we handled their cancellation.â€
With last-minute cancellations having the potential to wreak havoc in the revenue management arena, hoteliers from Los Angeles to London are opting for a range of solutions that include tightening the rules on refundable bookings and turning to more sophisticated algorithms to forecast.
Last-minute cancellations have been on the rise in recent years amid an emergence of online tools and platforms that make it easier for consumers to shop and compare hotels, explained Bjorn Hanson, a hospital industry expert and professor with the New York University Preston Robert Tisch Center for Hospitality and Tourism.
â€œItâ€™s an increasing problem that needs to be addressed,â€ he said.
â€œPeople are always looking for a better deal, and most cancellations happen when they see another hotel lowering their rate,â€ said Jamie Pena, VP of global distribution and revenue strategy for Omni Hotels & Resorts.
She and many of her fellow industry colleagues are taking action.
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