OK we all know that ancillary fees have generated $22.6 billion in revenue globally for the airlines. But I know that many have wondered about how the hotel industry has fared with ancillary fees.
Well, wonder no more. According to a recent article by my good friend Allison Hall of MeetingsNet, the projected figure is $1.95 billion in 2012! The article lists the most commonly assessed hotel surcharges/fees and goes on to state that "...Most fees and surcharges have incremental profitability of 80 to 90 percent or more."
In another article written by Sue Pelletier in face2face, it appears that now even the FTC is looking into hotel surcharge/fees.
And if you want to know specifically what the top 10 hotel fees are, check out this great list and commentary from Terry Ward on AOL Travel.
But when it comes to SMM, the bottom line is this: Just because you've been negotiating hotel program rates and discounts for many years doesn't mean you can go on auto-pilot during RFP season.
- Pay attention to industry developments and trends.
- Safeguard your company and hotel program from hidden costs and fees.
- If you're outsourcing your program & RFP management to a third party, make sure you include language in your SLA with them holding them accountable for making sure they enforce your strategy and policies around these charges and fees. Make sure they do their best to negotiate them away or at least to a minimum.
Hotel ancillary fees can all be measured, monitored and, if they are not already, should be a regular discussion point in your program reviews with all of your suppliers -- including your top hotel partners!
Kevin Iwamoto is vice president of enterprise strategy at Active Network. This post is republished from the Active Network | StarCite Strategic Meetings Managementblog with permission.