Customers May Cancel Hotel Bookings, and It’s Important To Understand Why
As I make the rounds conducting reservations sales training for hotels, resorts and call centers, I get to peek behind the scenes to see if and how today’s agents are tracking lost booking opportunities these days.
Considering how widespread the use of tech-based revenue-management and pricing systems are, many readers would be surprised how often agents are not doing any tracking whatsoever.
Some of us can remember that even decades ago, long before the term “yield management” emerged in the mid-1990s, most of us were trained to manually collect what we then termed “denials and regrets.” There’s really no excuse for not tracking this invaluable data, especially when most agents can collect this information either from a pull-down menu in their property-management system or by tagging calls in their phone system.
What’s worse is that many, if not most, of those who are tracking these data points are not doing so accurately. From what I see, this is usually not a problem of careless or lazy reservations staff, but rather a failure of revenue and marketing leaders to create a usable list of codes and monitor their use on a “by agent” basis.
Let’s start by looking at the second issue first. It is actually quite easy to monitor your team’s use of your existing codes. Most systems will generate a monthly report of “denial codes used by agent.” Then just spot-check the use of codes across the entire team over the course of 22 work days per month, which should be relatively equally distributed from one agent to another.
If you’ve not yet done this, what you will likely find is that certain agents are using a highly disproportionate number of denial codes. In other words, each one probably has a “favorite” code that they automatically select, typically the first one or two on the list.
To remedy this situation, first explain to the team why this data is so essential for tracking demand and then setting, and adjusting, rates and availability restrictions. Let the team know you will be looking at it more closely in the future, and they will likely pay more attention to accuracy.
Now let’s revisit the first issue preventing accurate data collection, which is that agents are not provided with a usable list of codes. Oftentimes agents are selecting from a list that is way too long, which takes agents too much time to sort through between calls, or the labels of codes listed are way too vague and confusing.
Here are some training tips for either creating or editing your list of denial codes.
- Strike a balance between creating enough codes to accurately measure truly actionable data points and having a short enough list to make it functional. Those with a “marketing” mindset will want to gather every data point imaginable, but the data collected will inherently be inaccurate.
- Evaluate each code on the list to determine if the data collected will truly be actionable. For example, while it may be interesting to determine how often callers decline to book due to rules and regulations such as a pet policy, a minimum age policy, or due to construction, unless you are going to consider stopping the construction, lowering the minimum age, or start accepting pets, then collecting this information is typically useless.
- Ensure that the difference between one code and another is something that can reasonably be determined accurately by an agent. For example, one recent client had both of these on their list: “Rate too high” and “No specials.” Another client had “Decided to cancel” and “Changed travel plans.” Most callers are, at minimum, not going to be that specific.
- The actual number of, and the labels of rate and availability denial codes, will vary greatly according to your inventory of accommodation types and what rate “levers” you are using, such as minimum stays, closed to arrival and whether you offer a “fade/fall-back” rate for voice callers.
If you do not yet have a process in place, here is a basic list to get you started.
- Denial — expressed that rate was too high.
- Denial — minimum stay too long.
- Denial — closed to arrivals.
- Denial — no availability.
- For those with a large number of accommodation types that vary greatly in size or view:
- Denial — availability — only larger open.
- Denial — availability — only smaller open.
- For those with a large number of accommodation types that vary greatly in size or view:
- Cancellation — found a lower rate elsewhere.
- Cancellation — changed plans.
By reviewing and updating your list of codes, and by helping your team understand how vitally important the details they are collecting are, the end result will be more accurate and actionable data to feed into your revenue and pricing decision-making.
Doug Kennedy is president of the Kennedy Training Network, Inc. Contact him at doug@kennedytrainingnetwork.com.
The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or CoStar Group and its affiliated companies. Bloggers published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to contact an editor with any questions or concern.
