Earlier this year, we saw a trend among the biggest hotel chains – including Hilton, Marriott, InterContinental and Best Western, among others – offering exclusive discounts to members of their loyalty programs.
Was this just the hotel companies’ latest attempt to sweeten program membership for their loyalists by adding another perk? While customers certainly benefit from getting a price break, the companies had another motive, according to the Wall Street Journal (paywall).
The exclusive discounts for frequent stay program members came with a restriction: To get them, customers have to book directly with the hotel company through its website or app. Reservations placed through third parties didn’t qualify.
The Journal says that the real reason for the hotel giants offering those discounts was to fight back against online travel agencies and booking services that were handling an increasingly large portion of hotel bookings – and collecting a substantial commission for each one.
The hotel companies used to collect more revenue from direct bookings than they did from reservations made through online travel agencies, the Journal noted. That changed in 2015, when the amount of bookings that came in through sites like Expedia and Priceline surpassed that of the chains’ own sites, having an adverse impact on their bottom lines.
The article noted that some online booking services are starting to fight back with tactics like giving lower priority in search results to hotels of the chains that are promoting loyalty discounts on direct bookings. Still, you have to consider your own bottom line: If you are not already a member of all major hotel frequent stay programs, you should at least sign up for basic membership if it means a discount.
Readers: Has the offer of exclusive loyalty program discounts enticed you to start booking hotel rooms directly with your preferred supplier? Do you ever book through third-party online services? Leave comments below.
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