dohop hotel
8 months ago
 

One in five hotel bookings on the web are cancelled

Some 19% of hotels that are booked online are cancelled before the guest arrives at the hotel, according to data provided by Dohop.

The travel search business, which runs its hotel channel as an affiliate of Booking.com, has released a heap of data to illustrate some of the trends of 2015 in the hotel booking world.

The one in five cancellation metric is “rather high”, Dohop argues, but says the figure is actually lower than the average for bookings running through the wider Priceline Group-owned mothership.

Broken down by source country, Russians are apparently either incredibly indecisive with their choice or find something else to do before taking a trip, with 75% (!!) of hotel bookings cancelled. This is in stark contrast to Brits and Norwegians which have a cancellation rate of 11.8% and 12.6% respectively.

The areas containing the most cancelled hotel bookings included Milan, Rome, Benidorm, Barcelona and Tenerife.

Some of the other top-line datapoints included:

  • The average length of a stay is four days
  • Average lead-in time between a booking and arrival is six weeks
  • Almost a third (31%) of bookings are made on a mobile device

Interestingly, Dohop found that there is a noticeable trend for one-night, last-minute hotel bookings on the system (12.7% of all bookings made).

It notes that such a model may continue to increase in size if Airbnb-type acccommodation sucks up more more longer stay trips, with hotels taking the short-term, last-minute segments.

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Kevin May

About the Writer :: Kevin May

Kevin is senior editor and a co-founder at Tnooz. He was previously editor of UK-based magazine Travolution and web editor of Media Week UK from 2003 to 2005.

He has worked in regional newspapers (Essex Enquirer) and started his career at the Police Gazette at New Scotland Yard in London. He has a degree in criminology, a postgraduate diploma in magazine journalism and publishes his first book - a biography about Depeche Mode - in late-2016.

 

Comments

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  1. Stuart McD

    Agree with other comments that 19% is very high, but given the Russians are blowing out the stats, it is difficult to make more of this without a more detailed look at the data. As far as Russians are concerned, 2015 headlined their economic crisis, with the currency tanking — probably reasoning just there for a chunk of those cancellations.

     
    • Johann Thorsson

      We’ve actually heard (including in comments below) that they are booking hotels to get visas and then canceling. We were quite relieved to hear that there was a proper explanation.

       
  2. Martin

    Our experience as a Booking.com affiliate has been a 35% cancellation rate. Most of our traffic is from North America and Western Europe. I also suspect many bookings are cancelled and rebooked for a different date or property in a new session on the OTA which leaves the affiliate without any commission. Many times we see the cancellation on the day of or day following the booking. In fairness to affiliates Booking.com should be setting a tracking cookie for the affiliate for at least 7 days, to ensure the affiliate still get credit if the customer rebooks.

     
  3. Ivan Burmistrov

    Could you provide a link to the original research, please?

     
    • Kevin May

      Kevin May

      @ivan – the original research is not published elsewhere, Dohop provided us directly with the data.

       
  4. Jamais McCullough Truijllo

    We get sooo many cancellation on Booking.com even though we have a 60 day cancellation policy. We originally charged $100 and they did not work. Just a bunch of people begging for their money back. We get less bookings but a lot less aggravation.

     
  5. Bayram

    Russian phenomena is due to visas: you need to provide hotel booking to apply for visa, so you book & then cancel.

     
    • Johann Thorsson

      Hi Bayram,

      I am relieved to hear that. I had been looking for an explanation other than that Russians were using our site to scam hotels. Glad to hear there is an actual explanation, (though it does sound strange).

       
  6. Timothy O'Neil-Dunne

    I think the data is spurious. I would like to know how the know EXACTLY how many are cancelled as they dont have access to the hotel actual data. This data comes from a very atypical source. It would be interesting to see the Hotel chains provide this data though.

     
    • Evan Davies

      They know exactly because they are an affiliate of Booking.com, when the booking is cancelled they get no affiliate income. Pretty easy to work out.

       
    • Johann Thorsson

      Hey Timothy,

      The data is actually spot on. As we are a Booking.com affiliate we only get paid if people use their hotel booking and we see every booking and cancelation made through our site.

      Booking.com’s system makes it very easy to cancel a hotel (I’ve done so myself) without being charged at all. People make use of this by booking in advance even if they are not sure they are going to take the trip in question. They can then cancel the hotel without any charge having been made.

       
  7. Ros Hart

    Since we implemented a one night deposit our cancellations have reduced dramatically. It does mean we appear lower in the rankings on B.com, but I would rather that than have the book-then-cancel brigade we used to get!

     
    • Nikolas HALL

      I have a full non refundable deposit on ALL reservations via Booking.com – the only 3 rd party site I work with. This has, like Ros stated – entailed a fall in ranking on Booking.com – but it increases cash flow (as bookings are made upwards of 6 weeks in advance) and entails 0% cancellations via Booking.com. For a small property doing this entails that you limit your exposure to last minute cancellations, and can better steer your occupancy.

       
  8. Kim Wilson

    Think part of the Russian issue is Visa’s which can also be a problem from various countries such as China.

     
  9. Annie's Guest House

    Our OTA cancellations are 1 in 5 even with a non-refundable first night deposit. Direct bookings via our website have an almost zero cancellation rate despite the same first night deposit requirement. I think OTA’s small print is to blame here or that a different type of customer books direct vs via an online travel agent.

     
  10. Evan

    Seems like the Russian data is skewing the whole, OTA’s do make it very easy to cancel a room and it’s important for hotels to look at their booking policy if they do receive too many cancellations. There are a few ways to reduce cancellations such as a small deposit or non-refundable prices.

     
  11. Colin Brownlee

    Neno is right. That is why with OTA bookings, we bill them immediately. Direct customers can simply reserve with a credit card guarantee. Another reason to book direct 😉

     
  12. Neno

    Interesting find. 1in 5 seems a bit too much.

    On the other hand booking.com makes it super easy to cancell as you dont feel any kind of responsibility to the hotel.

    Neno

     
    • Keith

      Often the longer in advance the booking the more likely you will see a cancellation. People begin researching their trip with very little idea of what the place is like, but they book their hotel using an OTA, especially if it is for an event where a destination might be busier. Then with a little research they find out more about the area, get recommendations from social media and often go directly to the hotel for a better price.

      It also depends on the context of the original referral link as this can have a huge impact on both the conversion rate and the type of customer you are referring as an affiliate.

      Finally many cancellations are not really cancellations at all, but people cancelling and re-booking, changing their date of arrival or departure, however if the referral ID from booking is lost then this data will not be known as the affiliate looses the commission share, with the OTA getting 100 percent of the booking fee.

       
      • Alessandro

        Very interesting!
        Is it possible to have data about Chinese customers?

         
 
 

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