findhotel.net
- Thread starter 1100011CS
- Start date
Maybe the savings are on upper end hotels? I checked prices against motels that I stay at for work and I do better with the discounts that I'm currently getting. Self-employed so I pick up my own expenses, high end doesn't fit my budget.
I spent about a minute on the website and couldn't even figure out how to find where to make a reservation to look at prices.
I think you mean .net and it's probably not a scam but it's probably the same as hotels.com or travelocity or whatnot. I'm gonna type something really long but the short answer is call the hotel and ask them for the price you see and you'll be surprised what you get, especially in today's climate.
1.) Let's first talk about Revenue Management and GDS's, OTA's, and TMC's
GDS - Global Distribution System. GDS's are something hotels (and airlines, car rentals, trains tour groups etc) use to transmit inventory and rates to travel agents and travel websites in real time. This is NOT an inventory tool for the hotel to manage rooms. This is a tool to try and book every last room in their hotel at normally discounted rates or to provide a list of rates to travel agents and agencies. They are populated by the hotel's revenue management person/team on a daily/weekly/monthly basis. There's a few of them but Sabre or Travelport is probably the most common. While they populate all the rates for the use of travel agents to use to see if they're giving their clients a good deal, you'll usually use one to get a deal off the "Rack Rate" more on that later.
OTA - Online Travel Agency. This is most likely what findhotel.net is. It's what travelocity, hotels.com, orbitz, pricline etc all are. OTA's used to just use the GDS and provide the best rate they could find. They've sense expanded into their own individual agreements with hotel's and hotel franchise companies. But the key difference is that most of the agreements have parity clauses in place where hotel's can't give one OTA a better rate than the others. This is usually 25-30% off best available rate.
TMC - Travel Management Company. This is slightly different than an OTA but to an outside viewer, they act very similarly. The best example is American Express Travel. They manage a company's corporate travel policy, travel expense management, and help companies book travel and what not. They negotiate directly with hotels as well with a special corporate rate that's close to 10% off best available rate.
Another type of TMC is called a consortium. They are a conglomerate of small companies or travel agencies that pay a membership fee to receive the same benefits as a TMC without the cost. Some TMC's are a part of a consortium as well but I don't want to complicate it too much.
There are other types of organizations that gather rates but they could fall under these 3 big ones. Destination Management Companies, Tour Operators, Wholesalers, Foreign Incoming Travel etc.
2.) Now let's talk about rates.
Rack Rate (RAC) - The published rate of a hotel for tax purposes. In other words this is the default rate of the room without any discounts. You might see this on the door of your room and is usually close to double what you paid.
Best Available Rate (BAR) - This is the best rate available to the public without any effort as well as offering the default cancellation policies. So if you went to hilton.com and you didn't log in, you would find the BAR. Usually the BAR is defaulted to 50% of the RAC.
Corporate Rate (COR) - This is the rate given to companies that provide repeat business to chains or certain hotels. Can be negotiated on an individual company basis but most likely through a TMC.
Fenced Rate (FER) - This is the rate with usually severe restrictions. This includes non-cancelable, pre-paid, non-refundable etc. While usually providing discounts to the BAR, the guest has to accept those restrictions.
Other rates include convention rates, promotional rates, inclusive rates, etc. But they're all measured against the BAR.
3.) Let's talk about how hotel's track how they make money per night. The examples we'll use are a crappy Courtyard in some small town in the midwest with 100 rooms.
ADR - Average Daily Rate. This is a metric used to show how successful a hotel and a revenue manager's goal is to raise this number year over year. ADR = Rooms Revenue / Rooms. EG - $20,000/100 Rooms = $200 ADR.
ARR - Average Room Rate - This is similar to ADR except instead of total rooms, the denominator is occupied rooms. ARR = Rooms Revenue / Rooms Occupied. EG - $20,000 / 75 rooms occupied = $266.67
ARG - Average Rate Per Guest. Another metric to show how much each guest is paying. The closer to the ARR this is, the more single occupancy rooms you are selling. This can help you see the trends of your hotel and maybe advertise towards that demographic. ARG = Rooms Revenue / Number of Guests. EG - $20,000/90 guests = $222.22
NET - Net Rate. This is essentially the ADR or ARR while subtracting the commissions that may be given to OTA's and TMCs. The closer the NET is to the ADR the more successful the first party booking tools are. NET = (Rooms Revenue - Commission) / Rooms. EG - $20,000 - $2000 / 100 = $180. This is a top KPI that hotels use that YOU can change and negotiate with.
4.) So who cares?
When you're booking hotels or honestly anything, it's important to know what's important to the person you're dealing with. Hotels care about those metrics I listed. The more you can manipulate those for the better, the more they care about you and the more discounts they may be willing to give.
So when you're using a site like findhotel.net you're ruining their NET metric on top of lowering their other metrics. The hotels accept a lower rate to boost their occupency rates but on top of that they usually pay a commission to the OTA because they "found" the customer. Priceline "Name your Price Tool" is the biggest **** you to hotels and they don't care about those guests. You might not care because you got a hotel for $40 a night though.
So how does buying a hotel from an OTA effect you?
5.) So what should you do?
Always try booking direct with the hotel on their website or by calling. If you found a scorching deal on a hotel, CALL THE HOTEL. They are more than likely trying to get rid of the room because their occupancy rates are low. Most of the time they are willing to work with you and get you the same deal. It's a win win. You get a similar price and they don't have to get bent over by the OTA.
On top of the pricing, booking direct with the hotel has an extreme amount of benefits. You can use their rewards program and receive those benefits. The cancellation policy is with the hotel itself and not a random website with it's own rules to **** you over. Refunding options and "make it better" options are far more limitless than booking with an OTA. If you have an issue that you think deserves a refund or a free breakfast or something, they are far more likely to work with you because you booked direct. The list can go on forever.
What are other ways you can get a better deal? "Shoulder" days. Shoulder days are the worst occupancy days and almost always are Sunday and Thursday. Think about it, how many times have you stayed in a hotel those days? Most business travelers travel fly in on Monday and fly out on Thursday. Most weekend vacation people check in on Friday and Check out on Sunday. Almost all my vacations include shoulder days and hopefully I can finagle 3 of them to show I am giving them better metrics on those down days which in turn have provided me much better rooms, discounts etc.
1.) Let's first talk about Revenue Management and GDS's, OTA's, and TMC's
GDS - Global Distribution System. GDS's are something hotels (and airlines, car rentals, trains tour groups etc) use to transmit inventory and rates to travel agents and travel websites in real time. This is NOT an inventory tool for the hotel to manage rooms. This is a tool to try and book every last room in their hotel at normally discounted rates or to provide a list of rates to travel agents and agencies. They are populated by the hotel's revenue management person/team on a daily/weekly/monthly basis. There's a few of them but Sabre or Travelport is probably the most common. While they populate all the rates for the use of travel agents to use to see if they're giving their clients a good deal, you'll usually use one to get a deal off the "Rack Rate" more on that later.
OTA - Online Travel Agency. This is most likely what findhotel.net is. It's what travelocity, hotels.com, orbitz, pricline etc all are. OTA's used to just use the GDS and provide the best rate they could find. They've sense expanded into their own individual agreements with hotel's and hotel franchise companies. But the key difference is that most of the agreements have parity clauses in place where hotel's can't give one OTA a better rate than the others. This is usually 25-30% off best available rate.
TMC - Travel Management Company. This is slightly different than an OTA but to an outside viewer, they act very similarly. The best example is American Express Travel. They manage a company's corporate travel policy, travel expense management, and help companies book travel and what not. They negotiate directly with hotels as well with a special corporate rate that's close to 10% off best available rate.
Another type of TMC is called a consortium. They are a conglomerate of small companies or travel agencies that pay a membership fee to receive the same benefits as a TMC without the cost. Some TMC's are a part of a consortium as well but I don't want to complicate it too much.
There are other types of organizations that gather rates but they could fall under these 3 big ones. Destination Management Companies, Tour Operators, Wholesalers, Foreign Incoming Travel etc.
2.) Now let's talk about rates.
Rack Rate (RAC) - The published rate of a hotel for tax purposes. In other words this is the default rate of the room without any discounts. You might see this on the door of your room and is usually close to double what you paid.
Best Available Rate (BAR) - This is the best rate available to the public without any effort as well as offering the default cancellation policies. So if you went to hilton.com and you didn't log in, you would find the BAR. Usually the BAR is defaulted to 50% of the RAC.
Corporate Rate (COR) - This is the rate given to companies that provide repeat business to chains or certain hotels. Can be negotiated on an individual company basis but most likely through a TMC.
Fenced Rate (FER) - This is the rate with usually severe restrictions. This includes non-cancelable, pre-paid, non-refundable etc. While usually providing discounts to the BAR, the guest has to accept those restrictions.
Other rates include convention rates, promotional rates, inclusive rates, etc. But they're all measured against the BAR.
3.) Let's talk about how hotel's track how they make money per night. The examples we'll use are a crappy Courtyard in some small town in the midwest with 100 rooms.
ADR - Average Daily Rate. This is a metric used to show how successful a hotel and a revenue manager's goal is to raise this number year over year. ADR = Rooms Revenue / Rooms. EG - $20,000/100 Rooms = $200 ADR.
ARR - Average Room Rate - This is similar to ADR except instead of total rooms, the denominator is occupied rooms. ARR = Rooms Revenue / Rooms Occupied. EG - $20,000 / 75 rooms occupied = $266.67
ARG - Average Rate Per Guest. Another metric to show how much each guest is paying. The closer to the ARR this is, the more single occupancy rooms you are selling. This can help you see the trends of your hotel and maybe advertise towards that demographic. ARG = Rooms Revenue / Number of Guests. EG - $20,000/90 guests = $222.22
NET - Net Rate. This is essentially the ADR or ARR while subtracting the commissions that may be given to OTA's and TMCs. The closer the NET is to the ADR the more successful the first party booking tools are. NET = (Rooms Revenue - Commission) / Rooms. EG - $20,000 - $2000 / 100 = $180. This is a top KPI that hotels use that YOU can change and negotiate with.
4.) So who cares?
When you're booking hotels or honestly anything, it's important to know what's important to the person you're dealing with. Hotels care about those metrics I listed. The more you can manipulate those for the better, the more they care about you and the more discounts they may be willing to give.
So when you're using a site like findhotel.net you're ruining their NET metric on top of lowering their other metrics. The hotels accept a lower rate to boost their occupency rates but on top of that they usually pay a commission to the OTA because they "found" the customer. Priceline "Name your Price Tool" is the biggest **** you to hotels and they don't care about those guests. You might not care because you got a hotel for $40 a night though.
So how does buying a hotel from an OTA effect you?
- Bad view from your room? Who cares you paid the least.
- Is it your anniversary and want something like flower petals? Hell no, you booked the cheapest rate on hotels.com why would I go above and beyond for a cheapskate?
- Bed is a little squeaky? "Sorry all other comparable rooms are taken" even if the entire hotel is empty
- Neighbor is loud at 3am? They booked the same cheap rate you did, you guys are stuck in the corner. "Sorry"
- Have a legitimate issue? "Sorry, I can't refund you, you booked with hotels.com, you'll have to take the complaint up with them"
- Overbooked hotel and they're literally out of rooms? "Oh, hotels.com made a mistake and shouldn't have sold you the room. Please contact them."
- ETC ETC ETC
5.) So what should you do?
Always try booking direct with the hotel on their website or by calling. If you found a scorching deal on a hotel, CALL THE HOTEL. They are more than likely trying to get rid of the room because their occupancy rates are low. Most of the time they are willing to work with you and get you the same deal. It's a win win. You get a similar price and they don't have to get bent over by the OTA.
On top of the pricing, booking direct with the hotel has an extreme amount of benefits. You can use their rewards program and receive those benefits. The cancellation policy is with the hotel itself and not a random website with it's own rules to **** you over. Refunding options and "make it better" options are far more limitless than booking with an OTA. If you have an issue that you think deserves a refund or a free breakfast or something, they are far more likely to work with you because you booked direct. The list can go on forever.
What are other ways you can get a better deal? "Shoulder" days. Shoulder days are the worst occupancy days and almost always are Sunday and Thursday. Think about it, how many times have you stayed in a hotel those days? Most business travelers travel fly in on Monday and fly out on Thursday. Most weekend vacation people check in on Friday and Check out on Sunday. Almost all my vacations include shoulder days and hopefully I can finagle 3 of them to show I am giving them better metrics on those down days which in turn have provided me much better rooms, discounts etc.
Doh. I didn't pay that much attention. Was directed there from the Google interweb.
