July 27, 2017

Hilton CEO talks cancellations, OTAs, and Airbnb

The increase in cancelled reservations has made it increasingly difficult for Hilton to manage its inventory and the cost of that ultimately not only impacts hotel owners but hotel guests as well.

News of Hilton’s new cancellation policy initially sparked major concerns from corporate travel buyers. CEO Christopher Nassetta, however, said Hilton has had discussions with its corporate customers and that their “reception has been perfectly fine.” He also noted that “a large majority of our customers do know, within those time frames, that they need to cancel or not, but they haven’t done anything about it” because the incentives to cancel in a timely manner didn’t exist before.

Expect Hilton to debut new rate structures that enable more flexible cancellation policies. “We have been testing some other things,” Nassetta noted. “Hopefully sometime in the second half of the year we will layer incremental opportunities on top of that that will start to bifurcate … creating fully flexible and semi-flexible pricing structures that would require a cancellation within seven days.”

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