Having more hotel bookings is good business for the property. But this can also be a hotelier’s greatest nightmare if this is not properly managed as this will lead to overbooking of hotel rooms. Without a proper strategy, this can be damaging to the reputation of the hotel and will affect long-term profitability. Unhappy travelers will often create bad reviews on popular review sites such as Tripadvisor which can be damaging to the hotel.
Overbooking carries both risks and rewards as this is a revenue management strategy practiced in the industry. It is a strategic approach to lessen losses from no-shows, cancellations, early check-outs by maximizing occupancy and revenue per room. But if this is not executed properly, it can backfire and cause long-term financial losses and damages to the property. It’s often a challenge for small and mid-sized hotel owners to oversee their room inventory in their own website and select Online Travel Agencies (OTAs).
Hoteliers should therefore have a proper overbooking strategy in place and with the right response, it will also lead to the recovery of the guest’s satisfaction. Here’s a guide on the right approach to handling overbookings without getting negative feedback from hotel guests.
5 Hotel Tips on How to Handle Overbookings
1. Confirm the overbooking
The first step for handling overbookings is for the hotelier to double-check if a guest relocation is required. This can be done by ensuring that the property is in fact fully occupied. Also, the guest-arrival list should also be reviewed for any errors such as booking mistakes, duplicated reservation or cancellation. It is best to consider as well on how many incoming reservations for the day and the number of no-shows/ cancellations to expect. This might even solve the problem if there will be cancellations for the day.
2. Determine which guests to relocate
This is best resolved on a case to case basis by finding the most suitable candidate for hotel relocation. The following factors should be considered such as source of bookings, booking date, duration of stay, and penalties from third parties. Most properties would have a criteria checklist beforehand to analyze their bookings. For example, VIPS, groups and individuals staying for multiple nights should get priority to stay. While short-term business travelers can be more flexible.
3. Rebook the guests
Once the hotelier has identified the guest to be relocated, the next step is to rebook at a comparable property. Beforehand, the hotel should already have an updated list of local properties with similar value and quality to send incoming guests. Ideally, it’s best to have a pre-existing relationship with hotel partners in order to provide similar rooms with the best rates for your hotel guests.
The job of the hotel staff is to be proactive in handling the accommodation for guests that will be relocated. They will be the source of information and comfort for guests during this time. Hotel guests will even appreciate the extra service your hotel will provide and will encourage them to book with you again during their next stay.
4. Monitor and follow-through
To give guests the best customer service, the hotel manager should call and book the replacement accommodation directly. It’s best to also contact the guest to be relocated before they arrive to get their personal feedback on their preferred accommodation such as location, type of room, etc. Guests will value the hotel’s genuine concern and care for them.
As part of your strategy for guest recovery, it is recommended to acknowledge the inconvenience by offering small compensation such as a bottle of wine, extra points, hand-written notes and other perks that you can offer to show that you value their loyalty.
5. Invest in technology
More hotels are adopting overbooking strategies due to last-minute cancellations. In the long term, having booking cancellations affect the hotel’s ability to forecast occupancy rates and revenues. Without real-time and actionable data onhand, it will be difficult for hoteliers to make strategic decisions and plans.
The hotel should therefore invest in the right technology and solutions that will forecast cancellation rates from booked guests. Hoteliers will be able to monitor real-time as well booking inventory and changes done even on the last minute.
ZEN eManager: The Digital All-in-One Solution in Managing Last-Minute Booking Changes
Having a strategy in place for overbookings and last minute cancellations will be advantageous to the hotel. The hoteliers will be able to do this through ZEN eManager, the digital all-in-one solution that has real-time monitoring of all hotel operations and inventory across all Online Travel Agencies (OTAs).
Trusted by more than 5,000 independent hotels in Southeast Asia that allows easy management of hotel listings across all online travel agencies (OTAs, monitoring of hotel operations real-time) and automated guest reminders that are sent out through its Property Management System and Channel Manager. ZEN eManager also includes a dedicated revenue manager for your hotel to ensure hotel rates are optimal with costs and to get maximum profits.
eZee Absolute PMS gives a 360° view of hotel operations, in which current occupancy rate, on-site staff, and revenue per available room (RevPAR) can be accessed through the mobile app, or any internet-enabled gadget. It also sends automated guest reminders which keeps guests engaged and increases assurance that your hotel is safe and secure. eZee Centrix Channel Manager allows hoteliers to monitor cancellations, re-bookings, and no-shows real-time, in which they can easily adjust room availability in any OTA anytime and anywhere, in one dashboard.
A dedicated revenue manager straight from ZEN headquarters collaborates with the property to ensure optimal pricing.
Book a free demo now at: http://www.zen-hs.com/book-a-meeting/