Update: Hyatt reached out to say they will be clarifying the changes to their best rate guarantee and it’s not as bad as original language of their revised terms and conditions suggested.

---

Hotel chains want you to book directly through them because it costs them less to make a reservation themselves than it does to pay a commission to Expedia or other online travel sites (or travel agents).

A dozen years ago hotel chains started to focus on driving their most frequent consumers to their websites by limiting points-earning to reservations made directly, limiting elite stay-earning, and in some cases even limiting points. While individual hotel treatment may vary:

• Major chains do not offer points-earning on room rates booked through many third party channels. Hilton does not even offer points-earning for incidental spending if you book through one of those channels.

• Major chains do not offer elite qualifying nights for these third party bookings.

• Starwood, Hilton, and IHG exclude members from receiving elite benefits on such stays. Marriott and Hyatt generally honor elite benefits.

Park Hyatt New York

Once upon a time even Priceline stays earned elite qualifying credit with Hyatt. Priceline stays even counted towards promotion-earning (like “Faster Free Nights”) as long as you had some charge post to your folio. Then again Faster Free Night free room redemptions counted towards Faster Free Nights-earning as long as you had a charge post to your folio.

It made sense to leverage the loyalty program to drive those consumers motivated by it to less costly booking channels.

But for both a chain’s best customers and for infrequent guests, they also had to make consumers believe they’d be able to get the best deal by booking direct.

Only they don’t actually ‘promise’ the best rates. All they do is promise a process by which if a customer discovers, under certain circumstances, that they aren’t getting the best price that they might be able to have the better price matched or beaten and might be able to get some compensation as well that varies by chain.

None of which is to say you can’t get good value out of the programs, quite the contrary.

Hotel chains do try to get their hotels to load the best rates through their own channels. But hotels do continue to market better rates through third party booking sites. One frequent way this happens is when those sites run short term sales, and solicit individual hotels to participate in exchange for priority placement. This may happen on third party sites especially targeted at non-U.S. markets, thinking that this won’t draw much US attention and thus won’t trigger many ‘best rate guarantee’ claims.

It’s a marketing gimmick.

Wyndham used to give you a free night every time you found a lower rate somewhere else. A 1 cent lower rate counted. Jumping between properties you could live for free. They chipped away at that and then gutted the offer in spring 2009.

Until two years ago all you had to do to get a 20% discount on the best rate you found somewhere else for one of their hotels was pick up the phone. They would verify your claim immediately. Then they limited best rate guarantee claims to an online form. The problem is that it meant ‘getting back to you within 24 hours’ during which time the better rate you found could go away. Or an employee verifying the claim wouldn’t find the rate, and since you can’t actually talk to them you can’t talk them through how to find it. So legitimate claims get denied.

Park Hyatt Vendome Paris

Now Hyatt’s gone ahead and made a change that further undercuts any notion of having a real best rate guarantee as opposed to simply claiming to have a best rate guarantee that they can market as a way to convince customers that they’ll get the best deals booking directly even if it’s not true.

Via One Mile at a Time Hyatt has changed the terms and conditions to require you to:

• Book the reservation with them first, before submitting a best rate guarantee claim
  
• And book the lowest rate available, even prepaid rates

This does two things:

1. It locks you into staying with Hyatt, and paying their web rate, whether or not they approve your claim for the lower rate.

2. It means that Hyatt doesn’t guarantee their flexible rates are the lowest anymore.

Grand Hyatt Kuala Lumpur

Often I’ll say “I’ll stay with Hyatt if they’ll match the rate I’m seeing for their property on another website.”

Hyatt, though, is saying “if you commit to stay with us then and only then we will consider matching the rate you’re seeing – but we might not, in which case you’re stuck paying more if you booked direct.”

Hotel chains aren’t serious offering best rate guarantees. They are marketing gimmicks intended to trick consumers into “looking no further” (in Marriott’s parlance) than the hotel chain’s booking channels, not a real promise to give you as good a deal as you’ll find somewhere else.

The new trend towards offering of a lower rate than you’ll find somewhere else as a loyalty program member — that Hilton and Marriott have tried to make a big splash with — is similarly gimmicky, that lower rate may be 2% or 5% lower… than the ‘Best Available’ or other similarly non-discount rate. It will not generally be as good a deal as a AAA rate.

And it really is often better to book high end properties through the right agent, rather than direct. Reservations made with American Express Fine Hotels and Resorts (and similar bank and Visa/MasterCard programs) or Virtuoso generally still earn points and elite status credit while providing value-added extras for often the same rate the chain would charge without those extras.

Book away from the chain in that case and you give up nothing, while getting perhaps breakfast and an upgrade. Pity the poor guest who believed they were getting the best deal booking through a chain at participating properties!