3 Critical Reasons Why Not to Hide Your Hotel Booking Cancellation Policy

Think about a visitor to your website who is fully convinced to make a booking. They double check dates, number of guests, and room type. One more thing is to review your cancellation policy. Oh, where can it be? Is your hotel cancellation policy easy to find as well as easy to understand? Note: This post applies to tours and tourist attraction bookings as well, so keep reading.

Stop Hiding Your Hotel Cancellation Policy

Travel Consumer Expectations About Hotel Booking Terms

Both leisure and business travel consumers have come to expect hotels to offer a clear and reasonable cancellation policy. With airline tickets, travelers know they are mostly non-refundable or involve a costly change fee. Cruises and group or package tours usually require a deposit that is mostly at risk. However the hospitality industry including resorts, B&Bs, guest houses, and inns requires cancellation flexibility to stay competitive and convert more bookings.

Here are the typical Booking Cancellation Policies (Clauses) you’ll find at major hotel chains as well as independent properties and B&Bs:

  • Free cancellation up until a set number of days before the check-in date
  • Free cancellation for a set number of days after making a booking online
  • One night or a percentage penalty for cancelling a hotel reservation based on date
  • A processing fee charged to cancel the room immediately or after a specific date
  • A strict no cancellation policy for a room rate that requires full payment in advance
  • Some combination of the above cancellation policies which varies by room type, room rate, and season (time of year)

To prevent losing bookings, find out why it is critical that you make your cancellation policy accessible, trustworthy, and unambiguous.

1. Booking lost due to cancellation policy not found

When potential guests cannot find your cancellation policy while reviewing rates and availability, there is a high probability they will abandon the booking process. I know I get frustrated when I click and search and click and still cannot locate an official cancellation policy.

To follow this booking conversion optimization strategy, you have to take into consideration two types of customers. One will look for your cancellation policy up front and make sure it agrees with their hotel stay preferences. That’s usually my way of booking places to stay. The other type of guest will start the booking process online and review the full terms and conditions before completing a booking.

Either type of customer may be booking in advance and therefore not be 100% sure of the dates. Or they simply may feel more comfortable knowing that cancellation is possible before clicking the “Book Now” button. I wish that I could find a survey to prove this, but common sense states that a cancellable rate will be preferred by most travelers unless you offer a financial incentive (i.e. discount) to prepay in full. When targeting business travelers, be aware that their company policy may require them to make only fully refundable reservations.

For all these reasons and more, it is essential that your cancellation policy pop up or page can be found and viewed in one or two clicks at most. That means linking to it directly in context during the various booking stages as well within your website menu, sidebar, and/or footer. Also make sure to open the page in a separate browser tab since you don’t want to disrupt the booking process.

Here is one example of poor usability where the cancellation policy is hidden in the “More details” area. Clicking that button reveals the cancellation policy alongside room amenities information.

Hidden hotel booking cancellation policy

When you offer both cancellable and prepaid (non-refundable) rates as many do, you want to make it absolutely clear which is which on the room selection page. Otherwise a potential guest may be confused when seeing multiple rates for the same exact room type and dates. In this case will the average user know to click the “More Details” button to find out which cancellation policy applies or will they accidentally book the lowest rate thinking it is refundable (see #3 below)?

2. Direct booking lost to OTA for trust reasons

This next hotel cancellation policy optimization tip is about trust. Does your cancellation policy vary based on whether the booking is direct or through your online travel agency (OTA) listings? Your potential guest will often check rates on the OTAs as well as directly with your own hosted booking engine. Do you offer the exact same cancellation policy options direct and via OTA? If not and there is a good or legal reason, explain it on your website to be more likely to earn their trust and direct booking.

However when your cancellation policy is not written in clear English, is located in a tiny window that is tricky to read, or if there are inconsistencies, you risk losing a booking to an OTA. Besides giving up the commission, think about what happens when a likely guest browses over to their favorite site such as Expedia or Booking.com? They’ll be tempted by other “promoted” lodging choices and may decide not to book your property after all.

Here is a screenshot of a booking system that requires the customer to hover their mouse to view rate rules. A small pop-up window appear next to each nightly rate as the user moves their mouse. Besides being confusing enough to require onscreen instructions, this type of interface makes it tricky for users to verify if the same cancellation policy applies to each night of an extended stay.

Hotel booking terms only visible with hover popup

I like to copy and paste the cancellation policy into my trip itinerary notes to refer back to. An overly complex user interface with floating or pop-up text or hidden elements makes that difficult. Plus have you tested how and whether your booking terms and conditions works on smart phones and mobile devices?

I Want to Trust Your Cancellation Policy

In my own experience, I occasionally come across booking terms that leave me guessing. Will the hotel be charging my credit card for the first night as a deposit right away or will they hold the number in case of a no-show? How long must I wait until I receive a charge back to my credit card? I also like to know how easy it is to cancel a booking. Does it require a phone call, email, or just a few clicks on the booking summary page? Make people trust you and your cancellation policy.

Finally there have been times when I’m ready to book a hotel but due to a poorly worded cancellation policy, where the terms differ slightly between the rates page and the payment page, I stop to reconsider. When I’m still convinced to book the room I’ll usually head over to the OTA instead. It is the familiar setting of the big OTA brand that makes me feel more confident that the listed cancellation policy is accurate and will be honored.

Like your valued customers, I want piece-of-mind when booking independent hotels, B&Bs, and guest houses around the world.

3. Cancellation policy confusion results in disputed bookings

When your cancellation policy is wordy or reads like legal fine print, there is a chance that you’ll convince the guest but there will be a problem later. What I mean is that the person will scan your cancellation policy during the booking steps and think that one cancellation policy applies when in fact a totally different cancellation policy is in place.

For example, here are the booking terms and conditions on a hotel booking site I found during my recent travels. It has lots of asterisks and text about the varying cancellation policies. How is a customer supposed to know which cancellation policy applies at a glance?

** Best Available Rate**
Your credit card details will be used to charge your first nights accommodation. In the event of a non-arrival or less than 48 hours’ notice of cancellation is given, this deposit will be retained by the hotel as penalty.
** 30 Day Advance Purchase **
Your credit card will be charged a deposit of the full amount of your stay. Your booking cannot be amended or cancelled without 100% penalty. Your deposit will be retained by the hotel.

Please refer to the rate you have booked for the relevant cancellation policy

It isn’t a problem with having multiple cancellation policies, it is that you shouldn’t ask your customers to figure it out for themselves. Display the terms alongside the live rates and again on the booking payment submission page. Be upfront since your customers are often in a hurry and quickly scanning rates on their computer or smart phone.

Don’t accidentally lead them down the path of booking the wrong rate option as they’ll be in for an unwelcome surprise if they need to cancel. While it is ultimately their mistake, it is your mistake to fix when the customer calls to makes changes or cancel their reservation completely.

Summary

So are you guilty of hiding your cancellation policy on your website, making it hard to trust, or confusing to read and understand? Follow these booking conversion optimization techniques to convince more website visitors to make a direct booking now and not run into cancellation difficulties later.

What other cancellation policy issues do you deal with at your hotel or tour company and what have you done on your website and booking engine to solve them? Add your comments to the discussion area below.

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