Sunday, March 25, 2012

Book Now, Cancel Later

I've noticed that Online Travel Agencies (especially based in the Northern Hemisphere) seem to be following the trend of promoting the generous cancellation terms of accommodation providers on their booking sites. Bringing this feature to the forefront of promotion encourages a segment of the public who are naturally cautious, to book now, safe in the knowledge that they are able to cancel without penalty at a later stage.

While this may extract more overall bookings, promoting to the public the ability to book accommodation on a whim can create headaches for accommodation providers. By making an accommodation booking with many OTAs, the public can lock-in rooms on a mere chance that they may travel and then cancel last minute. This type of scenario seems to becoming more common and the accommodation provider needs to balance the opportunity of attracting more business with the hassle and opportunity-cost of holding flip-flop reservations.

One reason a customer may wish to book now and cancel closer to the time, can be tariff related. I see that this week a subsidiary of TripAdvisor has launched a new booking site that may appease those consumers that fear missing out on a better deal if they commit too early.

So what's the spin? It's a simple premise that allows a person book accommodation and then receive an automatic refund if the same accommodation provider drops tariff before the cancellation date (ie commonly 24-48 hours before the arrival date). In a dynamic tariff environment, the consumer could be onto a winner.

I see that source inventory from Expedia, so Kiwi accommodation has been available to be booked via from their launch last Wednesday. 

I see that media sources (more than likely cut-and-pasted from's press releases) are calling this site a major game change for consumers that could “potentially corner the travel/hotel booking market.

I guess with the TripAdvisor relationship, will give it a good crack.

Click the "Get Widget" link below to place this widget on your website or blog!