As an airline employee in Omaha, Ron Wolfe loves to travel and hates to overpay for hotels.
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Consider his recent experience at the Comfort Suites in Grand Cayman. After checking rates and confirming availability online the night before, he flew in, hopped a cab and walked in without a reservation. “I talked to the front desk clerk; we got the manager involved, and I got a room that Expedia was selling for $175 for $135–$140,” he says. “It wasn’t a huge savings, but it was a savings.”
It’s a strategy that Wolfe has found quite successful over the years — “I’ve been able to get rooms at 20, 30 or 40 percent below advertised rates,” he says — and one that other travelers may want to consider. With occupancy rates in many destinations at historic lows, there’s never been a better time to play Let’s Make a Deal.
Last year, the occupancy rate at U.S. hotels dropped five percentage points to 55.1 percent. That means that on any given night, almost half the rooms in the nation’s hotels were empty. Economic recovery notwithstanding, analysts at STR Global say average occupancy rates will likely remain the same for 2010.
And empty rooms mean more opportunities to negotiate better rates. “I always say, ‘Don’t ask me for a favor when my hotel’s full,’” says Daniel Edward Craig, author and former general manager of the Opus Hotel in Vancouver. “But if I’m going to have empty rooms, I’m going to have a lot more flexibility to give good deals.”
Bottom line: ask and ye may receive. “A couple of years ago, consumers who asked for a discount from a quoted price were successful about 20 percent of the time,” says Bjorn Hanson, a professor at New York University and former hospitality analyst for PricewaterhouseCoopers. “Now, it’s above 40 percent.”
Here are some ways to improve your odds:
Do your homework: You can’t know what constitutes a good deal if you don’t know what the regular deal is, says Tim Leffel, author of “Make Your Travel Dollars Worth a Fortune,” who suggests checking out hotel and third-party Web sites before traveling.
Taking it a step further, he recommends visiting sites such as BetterBidding.com and BiddingForTravel.com, where other travelers post the successful bids they’ve made on opaque sites like Priceline and Hotwire. Says Leffel, “They’ll give you a good sense of which hotels are being more flexible on rates, so you’re not going into it blind.”
Shift your schedule: When it comes to hotel occupancies, all nights are not created equal, especially in destinations that host conventions, large events and lots of business travelers. (Many convention and visitor bureau Web sites will list upcoming events and conventions.) “Being flexible on the date of arrival can make a dramatic difference in rates and a hotel’s flexibility on prices,” says Hanson.
Extend your stay: The most successful negotiations are those in which both parties win and many hotel operators consider cutting prices on stays of one or two nights a losing proposition. “Hotels are looking for those three-night stays,” says Steve Swope, CEO and chairman of The Rubicon Group. “If you can either rope in the Thursday night before or the Sunday night following, you can often find better rates.”
The above strategies, of course, are geared to making reservations over the phone. (And if you do call, call the hotel directly, not a central reservations number as they rarely have the authority to negotiate.) But even if you walk in without a reservation, you may be able to bargain your way to a better rate.
Beware the BAR: According to Hanson, the first rate you’re often quoted isn’t the lowest: “In most cases, it’s not the ‘Best Available Rate,’ but rather, the ‘Most Available Rate,’” which is pegged to a particular type of room. There may be less desirable rooms that can be discounted, he says.
Factor the fade: The “fade rate” is the rock-bottom price below which a hotel is better off letting a room remain empty and it can vary based on a host of factors, not the least of which is timing. “Smart hotel operators will inform their front desk staff about what the lowest rate of the night is,” says trainer and consultant Carol Verret, “and it may be different at 7 p.m. than it is at 11 p.m.”
Understand your adversary: Even in tough times, hotels need to maintain a semblance of rate integrity. “They don’t like saying right off the bat, ‘Oh, actually there is a better rate,’ just because you asked,” says Craig. “As a rule, they need a reason for doing so. Are you retired or a member of AAA? They’re looking to help you get a better rate, but you have to help them help you.”
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