๐ฅCancellation& Flexibility
Last updated
Last updated
In the evolving landscape of hotel booking, cancellation flexibility has become a decisive factor for consumers. Research consistently underscores the critical relationship between reservation changes, cancellation policies, and customer satisfaction. For instance, ๋ฌธํ์, ์ํ๋ฏธ, and ๊น์ ๋จ (2018) highlighted that the reservation change and cancellation process plays a pivotal role in shaping customer experiences, emphasizing the need for a streamlined and customer-centric approach.
Strict no-refund policies have been identified as a major deterrent for customers. Benรญtez-Aurioles (2018) pointed out that such policies negatively affect consumer patronage, discouraging potential bookings and eroding customer loyalty. Similarly, Hu et al. (2019) found that many booking complaints stemmed from the rigid cancellation policies enforced by online travel agencies (OTAs), creating friction between customers and service providers, leading to dissatisfaction and lost business opportunities. This issue has been further exacerbated by the post-COVID-19 trend of tightened cancellation policies across the hospitality industry as hotels and OTAs attempt to mitigate financial losses. In fact, Xie and Gerstner (2007) reported that 16% of respondents had negative experiences specifically related to OTA cancellations, further emphasizing how difficulties in this area are a major cause of dissatisfaction.
The rigidity of cancellation policies affects not only customer satisfaction but also impacts bookings and revenue. Antonio, De Almeida, and Nunes (2019) demonstrated how restrictive policies reduce the number of bookings, creating a cascading effect that ultimately hurts hotel revenue. Moreover, Smith, Parsa, Bujisic, and Van Der Rest (2015) revealed that strict no-refund policies negatively influence consumers' willingness to pay, leading many to forego reservations entirely. They noted that customers may perceive such policies as overly restrictive, further deterring them from committing to a booking. This erosion of business and consumer loyalty presents a significant challenge for hotels that fail to adapt to the growing demand for flexibility.
As consumers become more discerning, offering flexibility in reservations has become a key strategy for maintaining competitiveness. According to the American Hotel & Lodging Association (AHLA) (2023), reservation flexibility has emerged as one of the most important factors for consumers when selecting a hotel. Cancellation fees, though often implemented to protect hotels from revenue loss, can also result in unintended consequences. Chen, Schwartz, and Vargas (2010) observed that stricter policies led to a 17% rise in travel insurance claims related to non-refundable lodging expenses, signaling that customers are increasingly cautious about the financial risks associated with non-refundable bookings.
The research conducted by Assaker and OโConnor (2023) from Cornell Hospitality Quarterly stands out as a definitive assessment of the importance of cancellation policies in the post-COVID era. Their findings, aligned with Masiero, Viglia, and Nieto-Garcia (2020), reveal that cancellation policies have become the single most influential factor in travelers' booking decisions, surpassing traditional considerations like hotel ratings, price, and brand. This influence was present even before COVID-19 but has intensified significantly in the pandemicโs aftermath, as flexibility now takes precedence over other factors in shaping consumer behavior.
Nattynites recognizes these shifting priorities and addresses these pain points directly. Through our NattyStays program, we offer customers the flexibility to tokenize their hotel bookings, enabling them to transfer or sell their stays on secondary markets if their travel plans change. This approach not only mitigates the negative effects of strict cancellation policies but also fosters customer trust and satisfaction. Subying (2021) found that customers offered fully refundable options reported higher levels of trust compared to those with partially refundable policies, reinforcing the value of offering flexible booking options.
Furthermore, Xie and Gerstner (2007) emphasized that most negative customer incidents are caused by service cancellation problems, reinforcing the need for smooth cancellation processes to enhance customer satisfaction. Lenient cancellation practices, they argue, lead to higher customer satisfaction and loyalty. By allowing bookings to be transferred rather than canceled outright, Nattynites ensures that customers are never denied service, even if their plans change, thus enhancing long-term trust and engagement. This strategy aligns with the findings of Riasi, Schwartz, and Chen (2018), who demonstrated that a seamless cancellation process significantly improves customer satisfaction.
By integrating flexible cancellation options, Nattynites not only resolves widespread customer pain points but also positions itself as a forward-thinking, customer-centric platform. The tightening of cancellation policies by hotels, particularly in the post-COVID-19 era, has created a gap between customer expectations and the rigid policies they now face, leading to dissatisfaction and unaddressed needs. Our model, which allows bookings to be traded or sold on open marketplaces, bridges this gap by providing the flexibility customers demand while simultaneously maximizing hotel profitability. This win-win scenario creates lasting value for both guests and hotel partners.
In conclusion, the evidence is clear: cancellation flexibility is essential to maintaining customer loyalty and optimizing bookings. Nattynites' approach, grounded in deep insights from research, confirms our commitment to offering innovative, flexible solutions that align with modern traveler expectations. Our tokenization model empowers customers, providing the freedom and flexibility they seek, while helping hotels secure greater revenue and satisfaction.
