bath independent guest house association

LateRooms puts the pressure on accommodation providers to enforce rate parity

I wanted to share this experience with you.

Since LateRoom, which is owned by large travel company TUI, raised their commission in January to 17%, accommodation providers have chosen a variety of different ways to manage this. Quite a few operators decided that enough was enough and stopped using LateRooms altogether.

Some of us have decided to ignore the terms of the new contact and either reduce the number of rooms/dates available only using them when you need to or loading the price so the LateRooms rate is not as competitive as other OTA. At Cranleigh we decided to load the additional 2% on to the cost of the rooms. We have seen a reduction in sales through LateRoom it has not dried up completely and we still benefit from the indirect business when customers find you on the OTA then Google your business to find you direct website.

Over the last few weeks we have received a number of emails from LateRoom informing us “how we can improve our sales and competitiveness”, identifying dates they had found cheaper rate on other OTA’s. This was followed by a telephone call from James at LateRooms. At first this was fairly friendly, I explained our position on the commission rise and how we have increased  our LateRoom’s rates in proportion. The call then turned more serious as James accused me of breaching our contract he informed me “your contract states you must match the rate you have on Booking. com and other sites”.  I responded by telling him that “all our suppliers get the same “net” rate, LateRooms choose to charge higher than market commission so therefore the rates are higher. I also pointed out that the terms and conditions are not as specific as he is making out. Throughout the phone call I found James have very little actual knowledge of any of the terms and conditions in the contract. I asked him directly if he was trying to intimidate me in to providing lower rates, this caused the mood of the conversation to change again. James became very defensive stating he “only wanted to make us aware we could improve our sales by giving them more competitive rates”.

Whilst our policy may not be judged to be fully compliant with the LateRoom’s terms and condition we believe is much fairer on the customer who has a choice of channels to make a reservation. It also encourages competition between our suppliers and we stand by it.

 

Tim Potter

Cranleigh, Bath