Hilton to Cut Group Booking Commissions

by Jessica Montevago
Hilton to Cut Group Booking Commissions

Photo: Roman Tiraspolsky/Shutterstock


In what may not be a surprise to some in the industry, Hilton announced today it would be reducing group booking commissions, following a similar move by Marriott earlier this year.

The new policy base group sales commission rate changed from 10 to 7 percent for bookings at hotels in the U.S. and Canada, effective Oct. 1, 2018. Group bookings made prior to this date will remain unaffected.

In a letter to travel agent partners, Danny Hughes, Hilton's senior vice president and commercial director, Americas, cited “growing group distribution costs and the complexity of intermediary services offered” as the driving force. “This change, whilst easing operations costs associated with group revenue, will allow our owners, over time, to make further investment in products and offerings that enhance the guest experience.”

“At Hilton, we recognize the important and integral role group intermediaries play in our meetings and events business, and we are proud to partner with a wide network of travel professionals to create meaningful experiences for our guests. At the same time, we also have to balance the needs of all parties, and we therefore continually review our sales and distribution strategies to ensure we are offering the best value for our customers, hotels and owners,” the memo said.

Many travel agents and other intermediaries expressed concern this would become a growing industry issue when Marriott International announced in January it would be reducing commissions on group bookings down to 7 percent for North American hotels.

“At a time when consumer usage of travel agents and advisors is on the rise and awareness of the irreplaceable role that agents play in the travel industry is growing, it is disappointing to see supplier partners moving in the opposite direction and devaluing their relationship with our members," Zane Kerby, President and CEO of the American Society of Travel Agents (ASTA), said in a statement.

"As the national trade association for travel agents, we are committed to defending and sustaining that role and intend to spotlight suppliers whose business practices recognize agents’ value, to raise concerns as appropriate with governmental stakeholders about the impact of supplier consolidation, and to otherwise give our members the tools they need to thrive in this complex and ever-changing industry,” he said.

While several hotels chains TMR spoke with previously, including Omni Hotels & Resorts, Wyndham, and Preferred Hotels & Resorts, reaffirmed they had no plans to change their relationship with intermediaries, Hilton, as well as Hyatt Hotels, declined to comment.

Some meeting planners said they would direct their business to more trade-friendly brands, but with Hilton joining the ranks of Marriott, it could be hard to avoid bookings at the two largest hotel companies in the U.S. In addition to its flagship Hilton Hotels & Resorts brand, it also operates 13 brands including Waldorf Astoria Hotels & Resorts, Conrad Hotels & Resorts, and Curio Collection by Hilton.

  1
  6
Tip of the Day
Daily Top List

Five Best Travel Destinations to Visit Between Seasons

1. Zambia

2. Fiji

3. Rome

4. Hawaii

5. Niagara

Source: GQ

TMR THIS WEEK
http://services.travelsavers.com/AMGService.svc/REST/GetImage?ImageID=a6408f73-01c0-e811-ba59-782bcb66a2f2

What Agents Need To Consider When Partnering With a Supplier

From loyalty and dependability to customer service and product innovation, choosing which suppliers to do business with is vital to success.

TMR Recommendations
Top Stories
IHG Plots Kimpton, Regent Expansion
IHG Plots Kimpton, Regent Expansion

It's part of IHG's plan to grab a bigger share of the $60 billion luxury market.

Hyatt Announces Andaz Turks & Caicos at Grace Bay
Hyatt Announces Andaz Turks & Caicos at Grace Bay

Owners of the residences, which are priced from $500,000 to $8.5 million, will be able to put their units into the rental pool of hotel inventory.

South Africa Update: Mandela’s Tourism Legacy, A Burst of Creativity & More
South Africa Update: Mandela’s Tourism Legacy, A Burst of Creativity & More

As South Africa marks the 100th birthday of Nelson Mandela, the nation’s ‘born-free’ generation is creating new types of visitor experiences.

Walt Disney World Moving to Date-Based Pricing Model
Walt Disney World Moving to Date-Based Pricing Model

Ticket prices will vary depending on how popular a specific day is expected to be.

After Months-Long Volcanic Eruption, Hawaii National Park Reopens
After Months-Long Volcanic Eruption, Hawaii National Park Reopens

Visitors can see the dramatic changes in the volcanic landscape left behind by Kilauea.

Hotel Trends 2019: What You Need to Know
Hotel Trends 2019: What You Need to Know

From fees and bookings to technology and immersive experiences, here are the predicted hotel trends for the coming year.

News Briefs
TMR Report Cards
Advertiser's Voice
Advertiser's Voice: Norwegian Cruise Line