Marriott International will reduce the commission rate on group bookings at North American hotels from 10% to 7% on March 31.

Marriott said that cutting commissions was necessary to enable further investment in its product.

"The current business model and environment … present significant obstacles to making the investments needed to deliver a world-class experience for customers. While group intermediaries play an important role in the marketplace, costs for our North American hotels and owners are growing at a faster pace than group revenue, which impacts hotel profitability," Marriott said in a statement Wednesday.

ASTA CEO Zane Kerby said travel agency trade group would "discuss this change with Marriott, our agency and consortia members and other stakeholders with an eye toward ensuring positive business outcomes for all involved."

"While we are in the process of assessing the impact of Marriott's announcement on our members' businesses, we are disappointed in the signal that a cut of this magnitude sends to the broader agency community," Kerby said.

Travel Leaders Group senior vice president of hotels Michael Heflin said, "It is unfortunate that Marriott has failed to recognize the tremendous value travel agents bring to group bookings and has instead chosen to view their agent partners as just another expense item.

"We also strongly believe that our agents should be fairly compensated for their investment of time, energy, resources and the valuable guidance they provide their clients, and we will continue to firmly advocate for appropriate group commissions within the industry."

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