How to avoid overbookings

When a property is using multiple channels to sell its rooms, it can reach many customers in varying markets - but these customers may also be booking simultaneously across the respective channels. And if there is only one room available, but two customers book at the same time this is where complications can arise.

As new distribution channels have come to the fore, the need to monitor your corresponding availability has been heightened. Different platforms will help you reach different customers, whether it’s new regions, demographics or customer profiles - and working with the right ones for your business will increase occupancy. But as much as technology has enabled distribution, sometimes these systems don’t always replicate fast enough to ensure the right information is captured in real time. The potential result? Overbookings.

Properties with more rooms tend to encounter problems with overbookings less, as, simply, they have enough inventory to move guests around to vacant rooms. But ultimately it’s not so much about the size of the property but the number of channels you distribute your inventory across and how much demand you are generating. It doesn’t matter if you have three rooms or three hundred - full is full.

Understanding the impact

Every overbooking affects the guest, but the degree to which it negatively influences the experience varies based on timing.

Firstly, there is a level of inconvenience: the guest has already taken the time to consider where they want to stay, then suddenly they are back at square one and have to go through that process again. If they find a better place, great - they’ll probably not complain, but at the very least there is still an additional amount of work.

What’s more damaging is when the overbooking is discovered late in the process. During the day a guest might be better equipped to deal with it, but you can imagine if they are arriving in the evening - they are tired, they’ve been travelling - the last thing they want to find at that point is that the hotel doesn’t have the reservation or that there are no rooms available to fulfil the booking. Of course, you do your best to help them, but it’s not a great experience.

For the accommodation too, an overbooking is not the ideal. You’ve done everything you can to entice a customer, only to potentially have to let them down - it’s not the message you really want to send about the hospitality you can offer. There’s also the operational impact or potential loss of revenue to consider.

Managing your distribution

The more channels you distribute across, the more beneficial it can be to look into channel management capabilities. There are a number of considerations here. First and foremost, it’s important to make sure the connection and system speed is as fast as possible. Secondly, make sure the availability you offer is real-time and that you share it across all your channels in an equal way. Addressing these helps lower the chance of overbookings - and one way of doing this is by engaging a channel manager.

Around 18 months ago, Booking.com introduced the Connectivity Partner Programme in which we defined three levels that would give a measure of quality in terms of how well the provider is equipped to support the needs of properties. The whole programme is based on adding or improving the capabilities of connectivity partners that properties need to maximise their distribution strategy. Booking.com is heavily involved with our providers to provide them with the right support to do this and develop their business.

At the same time, for vacation rentals we have two specialisation badges, which identify providers that offer additional services and support specific to the needs of both property management companies and homeowners. So, if a property partner is trying to manage availability across many channels, and finding that they are in need of further support, these are good reference points in the search for the right channel manager.

In our interactions with channel management providers, we are really trying to find solutions that provide the best experience for guests and property partners. A guest should be confident that when they book a room they will always have access to it - at the right price and the right time. And our partners should always feel confident that they can accommodate these bookings. By using a channel manager or property management system, an accommodation has the ability to manage multiple channels from a single interface, with pricing and availability all in one place - offering better control over their business.