By: Judith Hurwitz, CEO, Hurwitz & Associates Published: 30th March 2007 Copyright Hurwitz & Associates © 2007

“There are always consequences to our mistakes,” No this is not a saying from a fortune cookie. It is, in fact, the answer that a member of our team received when trying to correct a mistake made in a hotel reservation made through Orbitz, the online travel service. She had made a hotel reservation and decided that another hotel might be more convenient so she went online to cancel. After doing the cancellation she discovered that there would be no refund allowed. She immediately got back on the site and tried to reinstate the hotel reservation that had been paid for. I don’t have to tell you what happened – she was told, sorry, you are out of luck by the very sweet supervisor who imparted the words of wisdom about consequences and mistakes.

Now let me say that I have been using a variety of ecommerce services for many years with a great deal of success. What a pleasure to be able to log onto Amazon.com and have a book show up in three days – even one that has been out of print for years. But I would put travel sites into a whole different category.

This was not the first experience I have had with Orbitz. Before I tell you my additional sad tale, I would like to put this in perspective. I think a lot of us assume that it makes sense to do business with the big commerce site. After all, there have brand and name recognition which makes them seem like a sure thing. I remember in the early days of on line travel sites that there were organizations that would sell you a ticket and forget to send it. When you tried to track them down, their phone would be disconnected. Big sites like Orbitz, Expedia, Hotwire, and Travelocity spend a tremendous amount on advertising and marketing to create the persona of a large respectable entity – and some of them are indeed everything they say they are. However, there is a dark side to ecommerce that will have to be solved or the whole industry will suffer.

While I am not traditionally a complainer, I will be one today and tell you my story and how customer service responded.

I had a trip planned that I needed to change to the following week. I had planned the trip at least a month in advance and had gotten a pretty good price for a package of hotel and airfare from Orbitz. When my trip had to be changed, I tried to change it online but was unable to do so, so I called. (Have you ever tried to call an online site – is that an oxymoron??) Without causing you to relive my pain let me just say that after at least two hours on the phone with a variety of agents and their supervisors I lost my hotel reservation all together and had to pay a hefty fee to change my flight. I was told that the policies were clearly listed on the website.

Right…well maybe. In fact, if you look at Orbitz’s website under “canceling or changing reservation” you are told to follow a process. You are not told, “give up, all is lost”. Some sites, do in fact tell you right up front that if there are no changes allowed. Not so at Orbitz...

I think the problem is that these commerce sites make money by automating as much of their customer service as possible and adhering to very strict policies. I think these companies have a long way to go before the level of on line customer service is up to what many of us expect from a company we pay a lot of money to. I for one will think twice before I order a hotel or plane ticket from one of these guys – at least until they learn to improve the customer experience.

Reader Comments

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3rd April 2007: 'Mitch' said:

Most of the time it is not Orbitz or Expedia enforcing THEIR cancellation policy on you. Rather they are simply relaying the policy that is given to them by their suppliers. A lot of the suppliers have very strict cancellation policies, especially for their "bargain rates". A good example is the Airline tickets. The more flexibility you want in your travel plans, the more you are going to pay for the unrestricted fare classes.

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3rd April 2007: 'Binh Zientek' said:

I do understand your frustrations and in my role as accommodation specialist for serviced apartments in London, I hear the same woe from many clients.
Ecommerce sites are fine as long as you don't need to make changes, or ask too many questions, but when you do need advice or make changes (which happens) they are not helpful at all.

This is one of the reason why more and more people are seeking smaller agencies who do wish to talk and help clients make and change bookings. Unfortunately, machines cannot replace the personal human touch that only a human being can do.

I have also worked in Hotels in London and it is not true to say that hotels are not flexible with ecommerce sites. Hotels can change/amend bookings needed by the client, it is the ecommerce sites who are trying to be inflexible.

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3rd April 2007: 'Tonny Ramselaar' said:

As a hotel owner I symphatise with the writer's comments.There is however a big HOWEVER. Most hotels , airlines and other travel providers use internet agents and travel websites to sell (at discounted rates)those last few remaining rooms, flights etc. The discounts reflect the labour savings created by a fully automated internet process and the lead time of the products sold.

The whole process must be seen as last minute low cost travel or as low cost travel with strict terms.

One can use the system for ordinary travel planning but this will increase cost and does not offer flexibilty or service as provided by reputable travel agents.

No hotel, airline or other travel company wishes to charge cancellation charges. They want happy paying and spending customers!!!

Neither do they wish to have empty seats or rooms reserved early and released last minute by travellers booking whilst knowing that they may have to cancel!

Perhaps it would be better to book closer to the date of travel at normal prices through a reputable travel agent and leave the websites for lastminute travel decisions.

Reputable hotels, airlines and travel agents answer phone calls and repuatble websites reply to email. Fast and efficient!

I think you want travel agent's service from a website for good products at bargain prices but are not sure you are definitely going to need the products or services.

Now there is a management opportunity!

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3rd April 2007: 'David' said:

It's always, always better to book directly with the hotel. As much as 3rd party Internet sites want to paint themselves the same as hotels, they will never be because they do not own the inventory. They can only sell what the supplier gives them. The trade off is that you have to give up some flexibility. If you choose to book from an Expedia, Travelocity or Orbitz; your reservation relationship is with them- not the hotel.

In today’s world of rate parity and ease of use of hotel booking engines I wonder why anyone books through online sites. If 9-11 hadn’t happened, the success of the online companies wouldn’t have been so prolific. When it did, the only companies that had really booking capabilities were the online channels. If 9-11 hadn’t happened, hotels would have gone the route through internet channels anyway, albeit a little longer. The online channels have had a free ride for the past few years, now the hotels are taking back control of their inventory- and making more money in the process!

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3rd April 2007: 'interested_traveler' said:

The travel industry is a lot like a pendulum, David. When times are good and hotel occupancy is high, hoteliers and cruise lines tighten up and make few if any concessions to the OTAs. I worked for an online travel site when 9-11 happened, and in the months following we were able to book cruises and hotel rooms for almost whatever a customer was willing to pay. That was not a free ride! We were helping to move inventory, which would otherwise have sat empty. When travel started to recover, so did the pricing restrictions.

Hotels are deceiving themselves if they think they can directly capture their fair share of the market all the time. A better path is to forge profitable relationships between suppliers and sellers to efficiently capture as much of the available revenue for your market. Unless your market is Las Vegas or the small handful of markets that enjoy 90% plus avg. occupancy rates, your better off diversifying your sales channels rather than choking them off.

Online travel sites do add value to customers. If they did not, then customers would certainly go elsewhere.

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4th April 2007: 'Jeff in DC' said:

Interested Traveler -
If OTAs added value to the consumer, the consumer would be willing to pay extra for them. Instead, they charge the hotelier 18-35% commission, and then order their search results based on which hotel pays them the most. This is customer service? Get real. Use these third party sites to search if you must, but book through the supplier sites whenever possible. I have learned this lesson painfully.

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4th April 2007: 'interested_traveler' said:

The successful OTAs, and particularly the OTAs that will continue to succeed in the future, do add value to both consumers and suppliers. The best travel sites have content that the travel suppliers do not provide. They can guide travelers to new destinations and attractions, and they are usually not married to a particular brand or hotel chain, so they present a reasonably complete set of options. Travel sites that offer both planning and booking functionality in one locations are valuable to consumers. Again, if they were not valuable, consumers would go elsewhere. Should consumers shop around? Absolutely, but they should shop for the best price, the best service, and the best site features that together make up their user experience.

And until I hear hotel revenue managers saying, "Stop! No more business. We are swimming in hotel reservations and cannot handle any more business," I maintain that OTAs add value to suppliers as well. At the company I work for, we have some fantastic hotel suppliers, both chains and independents. They welcome the bookings we send their way because they understand that we shoulder the burden of the marketing expense as well as the cost of processing the booking and providing customer service.

I am thankful for the partnerships we have with our suppliers and look forward to profitable relationships going forward.

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4th April 2007: 'Chicago-Hotels.org' said:

This is one of the few problems that seem to occur when you book a "package" rate. It all seems dandy up front, but when you need to change your res...your in for a surprise.

As an owner and developer of niche destination travel sites, I think it is best to book your hotel and your flights separately. Most of the time these "deals" that the hotels offer these large travel sites are distressed and/or last minute inventory. When these rooms are packaged with a flight, it seems to you, the consumer are getting a great deal across the board, when in fact you are getting distressed hotel inventory and are paying near retail for the flight.

Do not listen to those who claim that going direct to the hotel is always the best bet. This is the only claim that the hotels have as they are incapable of effectively marketing themselves online. Always shop around and look for the best individual deals from multiple sites and make your flight arrangements separately.

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3rd April 2007: 'Matt Johnson' said:

Judith,

I have watched in amazement while on-line travel mega sites have lured hotels into giving them blocked inventory at huge discounts. Those rooms are then sold with significant margins to their websites, and a $50 cancellation penalty, or no refund at all to consumers.

We have been in the online travel business for 12 years. We offer customer service, charge no cancellation fees, use the hotels cancellation policy, and 80% to 90% of the time we match or beat the mega site prices.

There are still companies like ours out there for you.

Matt Johnson
CEO

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3rd April 2007: 'John McCormick' said:

I just went thru a similar issue with Orbitz. Did you know they have a sister company, Gullivers Travels Associates. I didn't.

After two day of phones, emails and faxes to and from Orbitz, myself and the hotel, I was told that any changes (I was adding 1 person to make 3) had to be done thru GTA. Then GTA told me no, they have nothing to do with it!! I finally cancelled the hotel res w/Orbitz, eat the penalty fee and re-book direct with another property for my Europe vacation...lesson learned for me..use the internet to connect directly with a property and get them to honor the Orbitz rate..it worked.

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4th April 2007: 'Kristina Hammond-Parker' said:

Judith's experiences are not new. We as a OTA for the past 12 years and bricks+motar before that have heard these comments many times and often get people coming to us in desperation and assistance because they cannot get in touch with a person. The big sites are predominantly interested in bulk business, mass production and really not interested in refunds or amendments. A quick overnight trip to one destination works. A long itinerary with unique customer requirements is almost impossible.
If people have a choice they would prefer not to pay up front. Cheap rates encourage them to do so without realising the consequences of no refunds and hard to make changes and if changes allowed come at a cost of $25 or more.
We have always pushed personalised service and encourage clients to deal direct with us. We often get them FOC upgrades, late checkouts, early checkins and a variety of benefits they cannot get with a online booking facility.

We are membership based and many members have been with us for nearly 20 years so I think the message is that personal service and good service is what people want. They want to talk to someone about their needs. They want to have confidence in who they are dealing with and will keep coming back if they are happy. Its not so much about rates these days. Most companies have access to very similar rates. It is service travellers want, not machines, not robots. After all travellers (business) are running companies or have jobs to do so why would they want to waste their time on searching the internet when they can send one request by email with their whole itinerary and have it all confirmed back within 24 hrs. It takes alot of time to go from one site to another looking to save a dollar or two.

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4th April 2007: 'Pat' said:

Some websites will help you their best to alternate your reservations made with them which mean their customer service is very helpful.
Some websites don't even bother to pick up the phone to check if the reservation can be modified.

Though at some points, I understand that it's difficult to change or cancel the reservations without any fee when we can book hotels with special rates. I never use Orbitz (I tried once but it didn't work since I live in Asia) so I do not know how they really are.

So as many said, if you want to get good rates for hotel reservations, make sure you'll never make any changes!

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4th April 2007: 'Scott in Denver' said:

People are constantly trying to get a better price on everything. "I want the lowest price on Earth." Then, when they get the lowest price on Earth, they complain that they don't get all the upgraded services that come with more expensive items.

If you want cheap, then online travel companies have to do everything they can to still make a profit, and yet provide you with the cheapest lodging/airfare/car rentals possible.

If you want to talk to people, and have great customer service, then I would tell you to stop shopping for the cheapest price on Earth.

I've been in the hotel/travel/online travel industry for more than 10 years. I have seen consumers continuously demand cheaper hotels, cheaper airfare etc. And then complain when they don't get the 5-star treatment.

When I go to Wal Mart, I understand I am there for price. Not service. And I wait in line FOREVER to pay for my basket full of cheap, imported from China, merchandise.

I would hope that most consumers would realize that you get what you pay for. If you want stellar customer service, then you should be prepared to pay a premium price.

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5th April 2007: 'mae' said:

I agree completely with Scott's points. To ad to that, how can online travel agencies such as Orbitz genuinely improve their services? (i.e. what's missing?) I don't think that there's a "magic bullet" out there that can resolve all the issues surrounding travel and ecommerce. This industry is still in its infancy, relative to the brick and mortar ways of doing travel in the past. What can Orbitz and its competitors DO to differentiate themselves, competing primarily on price? Where's my motivation to be loyal to one OTA versus another? Granted, one REALLY bad experience with Orbitz (or anyone else!) and I would lose faith in their service promise; in turn, they would lose my future business!

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6th April 2007: 'Sangeet Seth' said:

I fully agree with the author. All Travelportals are totally commercial outfits really looking at volumes and nothing else. Travel services is all about hand holding, it is not as simple as just buying a book or shirt. The transaction gets over once a book is bought and works well in online space, but Travel Service is different, the sale does not get over once the final enter button is pressed. Travel Portals have no ides on these issues. They just pick up the rates and sell. Now if there is a problem who deos one call INTERNET. Good old days of Travel Consultants are the best. I still use them. Atleast, a human being is there to talk to, who I know and in turn he knows someone where I am going. Atleast there is accountability, in online travel space god help is most imporatant if you by chance want to change anything from the time you preseed the final enter key. Only solution reserch on the net and get back to the Travel Agent.

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20th April 2007: 'Thomas' said:

Judith - now you have established a readership, any chance you could post some more blogs? Hate to nag - you are one of the few analysts I like to read.

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15th May 2007: 'Barbara' said:

I too am upset with orbitz.com Not only does Orbitz have horrible customer service, it is OUTSOURCED! How horrible is it to spend the time and energy talking to an automated system that is flawed and will hang up on you, but then you talk to a person that isn't even in the United States. I feel that the extra money spent to buy th flight directly from the airline is better, plus sometimes its a better deal when you take into consideration all the ridicules taxes and fees most of those "bargain" websites tack on.

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6th November 2007: 'Audio-Engineer' said:

We, too, have now TERMINATED our future use of Orbitz. Reason? Simple...of the last 3 bookings we made through them for hotels, EVERY SINGLE ONE was completely messed up...from failure to rrange for promised ammenities, such as SMOKE FREE rooms (I have severe asthma), to booking us for only 2 days of a 4 day convention in Louisville, KY, just 2 weeks ago..

At present, they now owe us over $1000.00 in reimbursement for incorrect bookings, falsified information, failure to correct THEIR mistakes in bookings, and a few more issues as well.

In the past 10 days, I have spent more than 15hours on the phones trying to solve these issues, averaging 2 hours on hold for every 30 minutes of talking to a real person who actually understands and speaks English!

Enough is enough....I HAVE place a call to the CEO of Orbitz, although I found out after the fact that the supervisor who gave me the corporate phone number gave me a totaly bogus name for the CEO..and tomorrow, I plan to call a number of state offices which are supposed to deal with internte companies who solicite citizens of NH, and make contracts with those citizens for services, such as Orbitz does.

It's time the EVERYONE starts standing up for the PRINCIPLE.... if we are paying for something, no matter what the cost, we deserve to get what we have paid for.....PERIOD ! No less...

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