While United Airlines' forcible removal of a paid passenger
is generating greater scrutiny of the airline industry's overbooking practices,
it is unlikely to alter how hotels treat guests when a reservation can't be
honored because a property is full.
Hospitality analysts said last week that because hotels
often face the prospect of losing revenue in the event of a late cancellation,
they will sometimes, like airlines, overbook. Hotels can also be oversold if a
guest insists on extending his or her stay beyond the original departure date
or if weather leaves guests stranded.
In such cases, guests who either are not loyalty members,
didn’t book directly or try to check in late at night can sometimes find
themselves without a room. But where hotels are not like airlines is that plane
tickets are prepaid, whereas hotel rooms usually are not, which means rooms are
rarely paid for by two different customers.
Still, hotels have long employed a policy of finding the
guest a comparable room nearby. The practice, known in industry parlance as
"walking" a guest, "has been very consistent for a very long
time," said Bjorn Hanson, clinical professor at the New York University
School of Professional Studies, Preston Robert Tisch Center for Hospitality,
Tourism and Sports Management.
Marriott International's policy is to reserve for the bumped
guest a room of "equal or higher value in the same area," while
InterContinental Hotels Group will secure the guest "a room and
transportation to another convenient and comparable hotel." Both companies
pay for the first night's stay.
Hilton declined to describe its policy.
"It is the general industry practice for the hotel to
make arrangements to secure a comparable room at another hotel, transport the
guest to that hotel and, in some cases, provide other amenities," said
Rosanna Maietta, spokeswoman at the American Hotel & Lodging Association
While U.S. hotel occupancy rose to a record 65.5% last year
from 54.6% in 2009, Hanson did not think guest-walking was on the rise. The
AH&LA does not keep statistics on the practice.
In fact, better technology related to both real-time booking
and data forecasting, combined with stricter cancellation policies, have likely
reduced the percentage of guests being walked, according to Chekitan Dev,
professor of marketing and branding at Cornell University's School of Hotel
Administration. And with the greater impact of social media and review sites
such as Yelp, hotel managers are more likely to add perks such a free meal or a
room at a higher-tier hotel to avoid any bad publicity generated by a walked
"From a guest's perspective, overbooking is a service
failure," Dev said. "In today’s social media-driven world, smart
hoteliers know that the key to success is not just customer acquisition or
simply satisfaction or even retention, but advocacy."