As hotels lean towards airline-style pricing strategies, Felicity Cousins asks what business travellers should expect.
arlier this year, an article in the Wall Street Journal highlighted that travellers staying in some US hotels were falling victim to unexpected or “hidden” charges. These extras, which were on top of the usual room rate and may not have been made explicit at the time of booking or check-in, included valet parking (even if you parked the car yourself), a resort fee for use of the pools and fitness centres, a charge for storing luggage, and, perhaps most scandalous, a minibar restocking fee.
Todd Kramer, vice-president of global corporate sales for the Hotel Reservation Service (HRS), which has 230,000 properties in its online database, explains why these charges may have come about. “The hotel industry in the US has seen prices dropping and people travelling less, and so the hotels see extra charges as a way to make up for lost revenue,” he says.
A few years ago we might have laughed in disbelief at the prospect of having to pay to put our luggage in the hold of an aircraft, or for checking in for a flight, but such “optional extras” – or menu pricing as it is known – are now common practice among the likes of Ryanair and Easyjet. While we might shrug off the hint that Ryanair may start charging us to use onboard toilets, and put it down to a publicity stunt, there is still a niggling worry that this may actually happen. Suddenly, what we have always assumed would be included in the price of a seat, or a room, is changing.
Whatever the reason – and the economic climate is guilty as charged – what we can get for our money today is shifting before our eyes. And it’s not only the low-cost airlines that are changing their tune. BA recently announced it would stop providing free food on short-haul flights, something many frequent travellers would not consider an “optional extra”.
The concern is that menu pricing, which has become so popular with the airlines, will take off in the hotel industry. Tim Sander, research director for hotels and hospitality at brand market research company BDRC, says: “Airlines have been doing this for a while, but I can’t see it happening [with hotels]. In the long term it is possible, but it would surprise me because hotels are all about services.”
Kramer of HRS says: “I think some of the additional charges could come across from the US, as Europe tends to follow American trends, but generally I don’t think European hotels will start charging for, say, storing a bag.”
While this may be the case for the moment, there are still plenty of unexpected charges that will keep even the most savvy business travellers on their toes. If you are booking a room online, some hotels don’t make it obvious what’s included in the rate. Kramer says: “We always include taxes in the prices we quote, and wherever we can, whether it includes breakfast, otherwise consumers are comparing apples and bananas [when searching for the best deal] and may get a surprise at the end of their stay.”
Another extra charge that arrived in Europe about a year and a half ago is the early check-out fee. (This is charged if you book for, say, three nights but leave after two). Margaret Bowler, director of global hotel relations for travel management company HRG, says: “The issue is that there is no consistency, even across the same hotel group, and often the policy is not specified at the time of booking, so you only find out the extra fee when you leave.” Bowler advises travellers to check cancellation fees too, as these can be inconsistent. It may be worth paying a higher room rate for the added flexibility of cancelling without a fee.
Once you’re tucked away in your hotel room, there are tempting treats everywhere you turn, but these, too, come at a price. Everyone knows minibar costs are extortionate, and most of us will do everything we can to avoid them. But if you do grab a beer from the fridge and then put it back, be aware that some minibars are electronic and will charge you for lifting the bottle out, whether you drink it or not.
Another point to consider is that often items are left on top of the minibar or on a table, and it’s not always clear whether these are free. Kramer says: “Sometimes you are standing there thinking, ‘If I drink that, will I be charged?’”
To combat this, hotel chain Marriott has taken to labelling the large bottles of water in its rooms with a price tag, but one Business Traveller reader was not so lucky when staying at a hotel in the US. A free tray of fruit had been delivered to his room, but it also had a large bottle of mineral water on it. At check-out he was shocked to see he had been charged US$18 for drinking it.
That said, Kramer says you can always dispute any charges that you see as unreasonable and excessive. “A few years ago I made some calls on the hotel phone, which I was shocked to see came to E150 at check-out, so I disputed it, saying the cost was insane for the calls I had made. They reduced it by half.”
While we are unlikely to see more extreme “optional” charges levied over here, there are still some basic services that many hotels consider as extras, to be charged on top of the room rate. Take breakfast – every time you book a hotel, you need to ask if it’s included. Colin Bennett, Starwood Hotels and Resorts’ area manager for England, says: “Nowadays, breakfast is rarely included in individual room rates as we find travellers value the flexibility of having breakfast with us, or going elsewhere for a coffee and croissant.”
The issue of “flexibility” is one that the budget sector is also keen to stress. Gerard Tempest, marketing director for Whitbread Hotels and Restaurants, says: “Premier Inn keeps room costs low and any extras are entirely optional. Extras include food and beverages as well as wifi.”
Most business travellers would argue that while breakfast is not essential, wifi is something you can’t do without. So it’s disappointing that most large hotel chains still charge for the service (see panel on previous page for some that don’t). The US’s Hampton by Hilton and Hilton Garden Inn brands, which only recently launched in the UK, offer free wired and wifi access in all their hotels. HRG’s Bowler explains: “In North America it is commonplace to get free wifi, so I think it will definitely be coming over here, but I think there are issues at the moment with service providers and costs.”
Kramer also believes that more hotels will start to include wifi in the price, so in that respect they will be branching away from the menu pricing approach. And Starwood’s Bennett hints there could be a change on the horizon for the group’s properties, after the recently renovated Turnberry resort reopened with free wifi throughout. He says: “We are working with the various service providers we have in our hotels to try to offer guests free wifi or reduce our charges. In many of our UK Sheraton hotels, wifi is free in public areas, as it is in the Link@Sheraton lobby areas we are installing across Europe.”
At least, for the moment, things aren’t as bad as in 2001, when some US hotels were adding energy surcharges to bills because the price of oil and gas was so high, and charging an extra dollar to eat in the hotel restaurant, to pay for heating up the food. Just remember to check your bills carefully and read the small print.
Before you go
When booking your room, ask yourself these questions:
? Is tax included in the room rate? US hotels can add up to 25 per cent on top of the price – in New York, four different taxes are added.
? Is breakfast included? If not, is it cheaper if I book online?
? Is wifi free? It is with Rezidor Hotel Group (Regent, Park Inn, Radisson Blu and Hotel Missoni), Hotel du Vin and Malmaison properties. City Inn offers free wifi and Mac computers in its rooms, while the Lanesborough in London supplies a Sony Vaio business laptop with free wifi access in its 95 rooms. In June, Choice Hotels Europe, which includes Comfort Inn, made internet access free in all of its UK hotels (previously charged at £10 a day).
? Are there any charges for early check-out and what is the cancellation policy?
? If the hotel has a pool and gym, is there a resort fee? If there is, and you are not going to be using the facilities, ask for it to be waived.
? Is there a charge for using the car park? Sometimes the facility may not be on the hotel’s grounds, so ask where it’s located.
? Do I qualify for an advance purchase rate? Premier Inn and Travelodge have good advance rates, so if you can plan ahead, there are opportunities to make substantial savings. Hotel Reservation Service (hrs.com) does spot-buying, which means it has minute-by-minute room rate updates from all 230,000 hotels on its system.
? Is it better to pay more to stay on an executive floor, which comes with benefits such as free wifi, drinks and snacks?
During your stay
Once you’ve arrived, be aware of any additional costs you might incur:
? Electronic minibars charge you if you remove an item whether you consume it or not. Keep track of what you’ve taken so you don’t have to stand at reception trying to remember if you had a midnight snack.
? Ask for your bill the night before you leave, and check it thoroughly.
? If you have to use the hotel phone, find out the charges beforehand.
? What might be free in one hotel is often not in another, even if they belong to the same chain – for example, mineral water and local phone calls.
? If you have been charged for something unexpected, query it at check-out.
