Hotel no shows are a frustrating reality for every hotelier. A guest books a room but doesn’t turn up – and worse, they don’t cancel. This leaves hotels facing unnecessary financial losses and wasted resources. It’s a small term with a big impact on the hospitality industry.
What’s really causing this issue, and what can hoteliers do about it? Let’s break down the impact of no-shows and explore why encouraging direct bookings might just be the solution you’ve been looking for.
What does a “no-show” mean in a hotel?
A no-show in the hotel business happens when a guest books a room but doesn’t show up or cancel ahead of time. This leaves the room empty, costing the hotel both revenue and additional operating expenses.
Why is a hotel no-show such a big deal for hotels?
No-shows in hotels can present numerous challenges for hoteliers:
- Revenue loss: An unoccupied room means lost income, especially during periods of high demand.
- Waste of resources: Preparing a room and providing services that ultimately go unused.
- Planning issues: An empty room might be difficult to re-let at short notice, which could negatively impact occupancy.
Higher cancellation rates with OTAs compared to direct bookings
A recent study found that bookings through online travel agencies (OTAs) are far more likely to result in last-minute cancellations or no-shows compared to direct bookings. Here’s the difference: when guests book directly through a hotel’s website, the cancellation rate is just 14%. On platforms like Booking.com, that number jumps to 57%. Why? Experts point to lower commitment levels and less customer loyalty when using OTAs. For hotels, this means more uncertainty and added strain on operations. Understanding this trend can help you focus on strategies that encourage guests to book directly, benefiting both your team and your bottom line.
Why are hotel no shows more common with OTA bookings?
1. Lower commitment with third-party bookings
Guests who book through OTAs often have less loyalty to a specific hotel. Multiple simultaneous bookings on these platforms are not uncommon.
2. More flexible cancellation policies
Many OTAs offer extremely flexible cancellation policies, which are customer-friendly but also significantly increase the likelihood of last-minute cancellations.
3. Less direct communication with the guest
As OTAs act as intermediaries, the personal contact between the hotel and guest is often missing. This can result in less emotional connection or loyalty, which in turn may increase the likelihood of no-shows in hotels.
How can you keep no-show rates low while still using OTAs?
How direct bookings can reduce hotel no-shows
Guests who book directly with a hotel are more likely to stick to their reservation. But what’s the reason behind this? Let’s break it down.
- Higher purpose of travelling:
Direct booking guests invest more time and effort in their decisions, significantly reducing the risk of no-shows in the hospitality industry.
- Improved customer relationship:
Direct contact between the hotel and the guest strengthens the emotional connection, ensuring the hotel is not merely seen as anonymous accommodation.
- Clear expectations:
Clear booking and cancellation policies provide guests with a better understanding of the terms and make handling cancellations in the hotel industry easier.
- Option for deposit or credit card guarantee:
Direct bookings give hotels more control over payment methods, reduce the risk of no-shows, and allow them to charge a no-show fee if guests fail to arrive.
Strategies to promote direct bookings and reduce the hotel no-show rate
1. Offer attractive incentives for direct bookings
- Offer better prices and exclusive benefits directly on your website, such as room upgrades or complimentary breakfast options.
2. Optimisation of the hotel website
- Ensure your website loads quickly, is mobile-friendly, and offers a simple, intuitive booking system.
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3. Personalised communication
- Leverage instant messaging channels like WhatsApp or SMS to send reminders to your guests about their booking and create a sense of commitment.
4. Flexible but clear cancellation and no show policies
- Find the balance between flexible policies and protection against last-minute cancellations in the hotel industry.
5. Early payment protection
- Consider deposits, credit card guarantees, or a no-show fee as protection against no-shows.
6. Utilise loyalty programmes
Fewer hotel no-shows with more direct bookings
No-shows at hotels are more than just an inconvenience – they can seriously impact revenue and create operational headaches. However, hotels can take practical steps to tackle this issue. Focusing on direct bookings and building stronger customer relationships is a great place to start. Clear communication, enticing offers, and a smooth booking process can help reduce no-shows while keeping guests happy. It’s a win-win for everyone.
Would you like to reduce your hotel no-show rate? Start today by focusing on direct bookings and taking back control of your reservations.
HiJiffy gives you an easy way to handle guest enquiries, automate repetitive tasks, and boost your booking rates. See how it works with a free, no-strings-attached demo today.
