When Deployed Correctly, Courtesy Holds Can Help Upscale Hotels & Resorts Close More Inquiries

Nov 27, 12 | 12:08 am

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By Doug Kennedy

When Deployed Correctly, Courtesy Holds Can Help Upscale Hotels & Resorts Close More Inquiries

The decision on whether or not to offer courtesy holds generally spurs some healthy debating on both sides.  Those who argue against courtesy holds generally cite reasons such as:

• Could potentially tie-up inventory that could otherwise be sold to others.

• Skews results of forecast projections.

• Creates unnecessary administrative tasks.

Yet when the managers at certain types of hotels and resorts fully embrace the process, and organize their operations to maximize sales efforts, the results always show it is a worthwhile effort. 

What types of lodging companies can benefit from offering courtesy holds?

Certainly, not all hotel operations can benefit from offering a courtesy hold and so it is not always the right thing to offer.  However, courtesy holds should be considered when:

• There are restrictive requirements, such as requiring an advance deposit or non-refundable deposit, that can create barriers to making a commitment right now.

• Guests tend to travel in larger parties requiring several rooms, such as extended families or informal reunions. 

• Callers are checking dates well in advance, and for which there is still plenty of time for the accommodation to be sold to others.

• There is a longer average stay and a higher ADR.

• There are revenue-generating outlets and/or other ways for the lodging operation to generate additional non-rooms revenue.

Courtesy holds are generally not of use for lodging operations that:

• Have a short term booking cycles and callers mostly checking near-term dates.

• Currently already offer the 6pm hold, non-guaranteed reservation. 

• Have a relatively low ADR and short average stay.

• Do not have revenue generating outlets, nor other ways of generating additional non-rooms revenue per guest. 

Why should we offer courtesy holds?

Giving your reservations sales agents the option of offering a courtesy hold in certain types of call scenarios provides them with an extra tool they need to maximize their call conversion rates.   A well-trained sales team will easily know when the conditions are right to offer courtesy holds, such as when callers are inquiring about dates that are far enough out that availability will not be impacted and when callers ready do express legitimate reasons for not being able to commit at the moment. 

This tool is especially important for upscale and luxury operations, such as destination type resorts, vacation rental companies, gaming resorts, and spa resorts and thus a high average revenue per guest.   The longer the average stay and higher the average rate, the more valuable each and every reservations call potentially is. 

If you have not done the exercise in a while, take a moment to multiply your transient average rate by your transient average stay, and that will tell you the revenue potential of every call.  Now add-in the "average" revenue your guests spend in outlets such as restaurants, bars, spa, retail, gaming, cabanas, and any other ancillary fees such as parking revenues or resort fees.  It is easy to see that each and every "qualified" sales inquiry is certainly work putting forward a tenacious and pro-active sales effort.

The best part is that to the guest, courtesy holds can be presented as offering above and beyond service,  as we will explore in more detail below. 

How can my team maximize its effectiveness at using courtesy holds?

• First, put the right parameters in place for your operation.  For example, you might allow agents to use courtesy holds for any dates 23 or more days out, and excluding periods of peak demand such as special events and holidays. 

• Do not offer too much time for the caller to decide; some reservations systems default to 7 days out.  It is generally better to offer 24, 48, or no more than 72 hours to decide unless they have special circumstances to consider.

• Be sure that agents first try to secure a confirmed reservation.  For example, they should first try to secure the deposit by reminding callers they would still have time to call back to cancel, assuming that is the case.  The courtesy hold should not be used in place of a full and direct attempt to secure the reservation. 

• Train agents to look for "flags" that a courtesy hold would be a good option.  For example, destination type resorts that host large parties often receive calls from the unofficial "planner" for the family or informal group.  Most resorts leave it where the caller has taken notes to share with the others and will need more time to gain a commitment.  Under these conditions, by offering to hold the accommodations and "lock it that special room" or "secure that special room type," the callers perceive this really is a courtesy being extended.

Pro-actively follow-up to maximize conversion rate for courtesy holds

• As mentioned above, very often callers really do have to check with others before deciding.  Under these conditions, offer to send a follow-up email to the caller with a link to the accommodation(s) discussed. 

• "That sounds good and I understand you need to check...  If you like I can email you a link to the (room/suite/vacation home) we just discussed so you can have that to forward on to your family..." 

• Then have the agents send a short personalized note referencing something about the conversation, and including a link to view the accommodation online.  It will not take long until you receive the first of many responses from guests with comments such as "Wow, thanks so much for sending that information! It really showed you cared.  No one else did that."

• Have agents set-up a system so that every day they check the pending "courtesy holds," and then send a short note (or perhaps even place a phone call) to remind them the courtesy hold is set to expire.  

About the Author

Doug Kennedy, President of the Kennedy Training Network, has been a fixture on the hospitality and tourism industry conference circuit since 1989, having presented over 1,000 conference keynote sessions, educational break-out seminars, or customized, on-premise training workshops for diverse audiences representing every segment of the lodging industry.

His articles have also appeared worldwide in more than 17 prominent international publications including the HSMAI Marketing Review, eHotelier, 4hoteliers, Hotel News Resource, Hotel Online, Human Assets - Dubai and Hong Kong, Hsyndicate worldwide, BAHA Times - U.K., Hospitality - Maldives, and the Hotel Expert Magazine Hong Kong. Since 1996 Doug has been a regular contributor to the lodging industry's number one rated publication, www.hotelmotel.com , where he has been a regular monthly columnist since 2001. Visit www.kennedytrainingnetwork.com for details or e-mail him at: doug@kennedytrainingnetwork.com.