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As I discussed in a previous post, The Illusion of Choice for Hotel Booking Options, there has been a lot of consolidation in the Online Travel Agency (OTA) market that has increased the relative clout of the OTA's when negotiating commissions and other items with hotel companies. Booking through an OTA is sometimes nice as you can quickly compare a lot of different options, but those are not your only options when deciding where to book your next hotel stay.
One thing you have to realize is that no matter where a trip is booked, there is always a commission built into the price. Having the right information and knowing where to find it can help you either save money, get extra-value added benefits or sometimes both. I like to think of it as a game and using your knowledge of knowing how to get the most bang for your buck is the end goal of that game.
Depending on your individual travel preferences, your budget, and where you want to stay there are a lot of ways to save money and extract extra value, with each having their own positives and negatives that I discuss below:
Option 1: Use an Online Travel Agency (OTA)
For most people, who are just looking for the best deal possible or want to quickly compare a list of hotels in an area, searching and then booking on an OTA website can be quick, hassle-free and convenient. The main OTA's include Expedia, Priceline, TripAdvisor and their subsidiaries. Most of the other online sites you know and love are likely owned by one of these companies (or will be very soon).
Some benefits of using an OTA include:
For the traveler who is interested in extra perks available through hotel loyalty programs, some negatives of booking via third party OTA websites include:
While not traditional OTA's, booking other types of accommodations using VRBO Airbnb, or Vacatia, for example, has also increased in popularity and each has its own set of pro's and con's.
Option 2: Book Direct
Hotels have recently began direct booking marketing campaigns to entice travelers to bypass the OTA's and book their next hotel stay directly at their website.
Examples of some of the hotel companies marketing direct booking campaigns include: Marriott, Hilton and Hyatt.
Hotel companies have a love-hate relationship with the OTA's, as on one hand they can help fill up rooms, but on the other hand, they hit hotels on their bottom line, with commissions that can range anywhere from 10-30 percent. Hotel companies sign long-term contracts with OTA's and go through lengthy negotiations with the travel sites over how commissions will work.
With the consolidation in the OTA market and Expedia and Priceline strengthening their negotiation power, hotel companies have began fighting back by introducing special perks only available by booking direct. The recent decision by Marriott to buy Starwood is also a direct response to the strengthening OTA market and having increased power on the negotiating table.
In order to entice future customers to book direct on their respective websites, the hotel companies are promising extra benefits only available by booking with them and not with Expedia or Priceline, for example.
These benefits vary depending on the particular hotel chain, but can include:
Option 3: Use a Credit Card Rewards Travel Portal
Using certain credit cards will earn you points in the respective program and will grant you access to the issuing credit card bank travel portal. In most cases you can pay out of pocket or use points/miles that you have accrued by using your credit card.
Examples of popular credit card rewards travel portals include:
Some examples of popular credit cards that earn valuable points in these respective programs include the Chase Sapphire Preferred, American Express Everyday, or Citi Thank You Premier, among many others.
In most cases when you accrue points you can redeem them for cash-back, use on the bank's travel portal or sometimes transfer to external travel partners and book directly at the hotel or airline website using points/miles.
When used at the bank's travel portal, you typically get anywhere from 1.00 - 1.25 cents in value per point. In other words, 10,000 points may be redeemable for up to $125 in value when booked through the credit card rewards portal.
If your points alone aren't enough to book, you can typically pay the difference using your credit card. Booking your stay using a credit card travel portal can help save you money by utilizing your points, but can be a bad redemption in terms of the value you're getting for each point. You also may not be able to access the exclusive rates/discounts and perks available only by booking direct that I mentioned above in Option 2.
Option 4: Use a "Hotel Collection"
There are three main hotel collections, among a few others, and they include:
Note that there is also another hotel collection offered through American Express called The Hotel Collection. The benefits for this hotel collection aren't as good as the others, but still provides some extra value. Access to this hotel collection is available to anyone with an American Express Premier Gold credit card or higher.
Hotel collections mainly include 4-5 star hotels and resorts and include extra perks for the same price you can find elsewhere online. You can only access these perks by having certain credit cards as mentioned above. If you don't have high enough hotel loyalty program status and the perks that come with it, booking through one of the above mentioned options can be a good way to get extra value for your next hotel stay.
Depending on the particular hotel collection and the benefits they guarantee, you will get value-added perks including:
Option 5: Use a Travel Agent
In the past, planning a vacation meant calling a travel agent to book your tickets, hotel and all activities. With the advent of the Internet and with all of the information available online now and numerous options to book travel, you're likely asking yourself why would I need to use a travel agent?
There are a few good reasons why you should consider using a travel agent for your next trip or at least see what they can offer you since you can miss out on exclusive deals and special perks offered to travel agents that are not bookable when you book online by yourself. Travel agents will know the promotions, offered exclusively to them by their travel partners, which can save you money and add extra value-added benefits you can't get yourself. They can pinpoint the right deal for you from offers not available publicly anywhere else.
There can be many benefits when using a travel agent, but focusing on how they can help you save money and get extra value on your next hotel stay is shown below:
How can travel agents offer lower rates and sometimes add these extra value added benefits?
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| How do you plan on booking your next trip to paradise? |
Depending on your individual travel preferences, your budget, and where you want to stay there are a lot of ways to save money and extract extra value, with each having their own positives and negatives that I discuss below:
Option 1: Use an Online Travel Agency (OTA)
For most people, who are just looking for the best deal possible or want to quickly compare a list of hotels in an area, searching and then booking on an OTA website can be quick, hassle-free and convenient. The main OTA's include Expedia, Priceline, TripAdvisor and their subsidiaries. Most of the other online sites you know and love are likely owned by one of these companies (or will be very soon).
Some benefits of using an OTA include:
- Search a destination for a wide variety of hotel options very quickly
- Being able to find deals or last minute specials on occasion
- Access to OTA rewards programs with examples including Expedia+ Rewards, Orbitz Rewards (earning Orbucks) or Hotels.com (10 nights booked equals one free night) to name a few.
For the traveler who is interested in extra perks available through hotel loyalty programs, some negatives of booking via third party OTA websites include:
- No hotel loyalty program recognition in some programs, along with none of the benefits that go along with it, i.e., free WiFi, late checkout, etc.
- Possibly paying a higher rate than available by booking direct (see Option 2 below)
- Foregoing the option to earn hotel loyalty program points or tier status credit (in exchange for OTA reward program points/credits)
While not traditional OTA's, booking other types of accommodations using VRBO Airbnb, or Vacatia, for example, has also increased in popularity and each has its own set of pro's and con's.
Option 2: Book Direct
Hotels have recently began direct booking marketing campaigns to entice travelers to bypass the OTA's and book their next hotel stay directly at their website.
Examples of some of the hotel companies marketing direct booking campaigns include: Marriott, Hilton and Hyatt.
Hotel companies have a love-hate relationship with the OTA's, as on one hand they can help fill up rooms, but on the other hand, they hit hotels on their bottom line, with commissions that can range anywhere from 10-30 percent. Hotel companies sign long-term contracts with OTA's and go through lengthy negotiations with the travel sites over how commissions will work.
With the consolidation in the OTA market and Expedia and Priceline strengthening their negotiation power, hotel companies have began fighting back by introducing special perks only available by booking direct. The recent decision by Marriott to buy Starwood is also a direct response to the strengthening OTA market and having increased power on the negotiating table.
In order to entice future customers to book direct on their respective websites, the hotel companies are promising extra benefits only available by booking with them and not with Expedia or Priceline, for example.
These benefits vary depending on the particular hotel chain, but can include:
- The ability to use hotel loyalty program points to reduce your out-of-pocket cost.
- Best Rate Guarantee
- Find a lower rate and they match it and then beat by 10-25%
- Lowest Price Available Online
- Exclusive loyalty member-only rates or discounts only available by booking direct that can range anywhere from 2-10%, depending on the hotel chain and timeframe of travel
- Mobile Check-In
- Free Wi-Fi
- Complimentary breakfast for those with high enough loyalty status earned through stays/nights at a particular hotel chain or by having the right hotel credit card that grants high enough status in the loyalty program for having it.
- Third party rates are not eligible for loyalty points and/or tier status credit
- Use hotel loyalty program points or points+cash options to book
Using certain credit cards will earn you points in the respective program and will grant you access to the issuing credit card bank travel portal. In most cases you can pay out of pocket or use points/miles that you have accrued by using your credit card.
Examples of popular credit card rewards travel portals include:
- Chase Bank - Ultimate Rewards
- Citi Bank - Thank You Points
- American Express Travel - Membership Rewards
In most cases when you accrue points you can redeem them for cash-back, use on the bank's travel portal or sometimes transfer to external travel partners and book directly at the hotel or airline website using points/miles.
When used at the bank's travel portal, you typically get anywhere from 1.00 - 1.25 cents in value per point. In other words, 10,000 points may be redeemable for up to $125 in value when booked through the credit card rewards portal.
If your points alone aren't enough to book, you can typically pay the difference using your credit card. Booking your stay using a credit card travel portal can help save you money by utilizing your points, but can be a bad redemption in terms of the value you're getting for each point. You also may not be able to access the exclusive rates/discounts and perks available only by booking direct that I mentioned above in Option 2.
Option 4: Use a "Hotel Collection"
There are three main hotel collections, among a few others, and they include:
- Visa Signature Luxury Hotel Collection
- Available to anyone with a Visa Signature credit card
- Check the bottom right-hand corner of your credit card. It could be a Visa Signature, Visa Platinum or just a Visa card. The different options vary depending on your creditworthiness.
- MasterCard Luxury Hotels & Resorts Portfolio
- Available to anyone with a MasterCard WorldElite credit card
- American Express Fine Hotels and Resorts Collection
- Only available to American Express Platinum card members. The Amex Platinum card has an annual fee of $450 per year.
Hotel collections mainly include 4-5 star hotels and resorts and include extra perks for the same price you can find elsewhere online. You can only access these perks by having certain credit cards as mentioned above. If you don't have high enough hotel loyalty program status and the perks that come with it, booking through one of the above mentioned options can be a good way to get extra value for your next hotel stay.
Depending on the particular hotel collection and the benefits they guarantee, you will get value-added perks including:
- Best available rate guarantee
- Automatic room upgrade upon arrival, when available
- Complimentary in-room Wi-Fi, when available
- Food or beverage credits ranging anywhere from $25 - $100
- Spa or other hotel credits
- VIP Guest status
- Early Check-In and/or Late check-out, when available
- Complimentary continental or full breakfast daily
- Welcome Amenity (Wine, desserts, fruit platters, etc)
- Other Property Amenities
Option 5: Use a Travel Agent
In the past, planning a vacation meant calling a travel agent to book your tickets, hotel and all activities. With the advent of the Internet and with all of the information available online now and numerous options to book travel, you're likely asking yourself why would I need to use a travel agent?
There are a few good reasons why you should consider using a travel agent for your next trip or at least see what they can offer you since you can miss out on exclusive deals and special perks offered to travel agents that are not bookable when you book online by yourself. Travel agents will know the promotions, offered exclusively to them by their travel partners, which can save you money and add extra value-added benefits you can't get yourself. They can pinpoint the right deal for you from offers not available publicly anywhere else.
There can be many benefits when using a travel agent, but focusing on how they can help you save money and get extra value on your next hotel stay is shown below:
- Save Time & Personalized Planning
- An agent can save you time by vetting thousands of flight and hotel options to find the right fare at the lowest rate. There is a glut of information online and sometimes you may need someone to make sense of it all
- Whether you’re the do-it-yourself type or are looking for someone to completely take the reins, when you collaborate with a travel agent, your trips can be tailored to your needs, interests, and budget
- Extra Value For Your Money
- A travel agent has access to the same (and often better) pricing than you can find online, and can secure special perks like free room upgrades, daily breakfast, and other benefits you can’t get on your own.
- It's a common misconception that using a travel agent will cost you more money.
- It doesn't cost you anything extra to book through an agent vs. booking through other methods, as the supplier is the one who pays commission to the agency that books on behalf of you. However, there may be some travel agencies that do charge other fees and those should be disclosed to you up front.
- One thing to note is that travel agents, with certain affiliations, can also access the discounted rates only available by booking direct from Marriott, Hilton and Hyatt that I discussed above in Option 2.
- It doesn't hurt to compare options and see what a travel agent can offer
I plan on discussing this in length in future posts on the website, but having the right travel affiliations gets agents access to a host of benefits by belonging to the right travel consortium/affiliations and by knowing which wholesale travel providers can help their clients save money. By having these affiliations, agents are able to access preferred relationships, usually as a result of consortium contracts, and have access to value-added benefits that may include discounted airfare (mainly international fares or when packaged with a hotel or car), consortium hotel collections and other discounts.
Some examples of these travel consortiums and wholesale travel providers include Virtuoso, Travel Leaders Group, Signature Travel, Ensemble Travel, CCRA, Classic Vacations, Apple Vacations, among many others.
As you can see, sometimes, spending hours on the computer searching for the best travel deals gets you results -- and other times, it just leads to frustration. When you work with a travel agent, they do a lot of the legwork for you, searching out the travel options that best meet your needs and budget. In most cases, travel agents have access to information about rates and routes that the average consumer might not have, saving you time and money, and being able to add value-added benefits for your hotel stay. Using a travel agent can also help you score a great deal on a package or promotion. Agents generally receive information and access to promotions from resorts, cruise lines and other travel providers that aren't available to the general public.
Summary
From the options I've discussed above, there are all kinds of ways to save money and extract extra value for your next hotel stay. But unless you follow travel news religiously and monitor numerous websites for deals daily, the sheer amount of information and options out there can be overwhelming.
There is no right or wrong way to go about booking your next trip, but what options do you prefer using when researching? And what do you ultimately end up using to book that trip considering the pro's and con's of each of the options mentioned above?
Summary
From the options I've discussed above, there are all kinds of ways to save money and extract extra value for your next hotel stay. But unless you follow travel news religiously and monitor numerous websites for deals daily, the sheer amount of information and options out there can be overwhelming.
There is no right or wrong way to go about booking your next trip, but what options do you prefer using when researching? And what do you ultimately end up using to book that trip considering the pro's and con's of each of the options mentioned above?
