Misuse of Corporate\Discounted Rate Codes
 

Hello all.

I know that this email might be a little stinging to some, but I have not really said anything regarding the public publication of corp/disc rate codes, and when I have it has helped (regarding definitions of rate codes).

I have said before that I thoroughly enjoy hearing my guests (and best guests - Marriott Reward members) onions on this forum. I have seen the corporate rate list being posted here and other discounted rate codes. Of course, being a GM and operator of a hotel, this concerns me.

I want to preface the rest of this thread by letting everyone know I am not just getting up on my virtual soapbox. I am just trying to give everyone a little insight and impacts on abusing some of the codes. I am just like you - I make a purchasing decision based on the product/value. So don't think for a second that this thread is coming from someone bringing down 7 figures a year.

Corporate rates for a company are based on volume delivered, along with the stay pattern (if they pick up shoulder nights). These negotiated rates are based on the hotel/market/volume for the individual hotel. As was mentioned earlier in another thread, these rates have LRA (Last Room Availability) or NLRA (Non LRA). This is also determined on volume/stay pattern/total dollars spent. Some of this LRA/NLRA are negotiated at the corporate level of Marriott, or are dictated by the company itself. Setting/acceptance of the terms is determined by the properties (they may be exceptions for project/special group business).

To my point. Each property forecasts room night volume/pattern/dollars for a given year prior to negotiating, or being including in the RFP/pricing process. For example, Company A might have a neg rate and LRA, but due to their stay pattern, that may not offered the nexr year (rate or LRA status) due to the actual use.

Corporations negotiate their rates in good faith with us based on these set of criterion. It is a partnership that Marriott enters into with our partners. It has to be a win-win, obviously. Yes, it is the individual property to ask for ID for whatever discount is booked by a guest checking in. You and I both know that doesn't happen frequently. I want my front desk people focusing on you (taking care of you, having real conversation, meeting your needs) rather than asking you for proof that you are a member of whatever corp/group you are with. This wouldn't sit well with me, and I am sure it would not sit well with you on a consistent basis. This should be standard practice (and is usually required by the neg rate contract), and I know that that stay at our hotels, mainly, are not the ppl that signed the agreement.

The big effect of misusing rate/corp codes - a property will not participate in a respective rate program, or if they choose to, they will not offer LRA or as a big neg rate.

I do appreciate all of our big corporate customers - don't get me wrong. They are my bloodline. However, this misuses at times can actually hurt they ability to negotiate a better rate fo0r their company due to inaccurate information. They report X number of rooms for a given night of the week (YTD), and we show something completely differ. This does make it difficult.

Once again, I am not trying to just trying to give you the facts that happen during the pricing process, from MHO.

I want you to get the best deal for you or your companies as well. Sometimes it will be a good fit, sometimes it will not. Negotiate with the properties - many times, as has been pointed out, a corp rate can be established and is a win-win to your company and the hotel.

I know this will cause some waves, and I do regret that. However, I am just trying to assist and let everyone know what does actually occur behind the scenes.

I will to respond to posts. Just give me a day or two - I have a busy week coming up. Thanks.

I'd like to hear more about this, but for the record:

1. I have never used any of the codes listed here, either because they never seem to apply to the property I have in mind, or the GOV rate (for which I am eligible) is better. Sometimes the over-50 rate is better. I go for the deal I quality for.

2. For the periods I have negotiated a rate (because I'm going to be at a particulay property for an extended period of time), I negotiate with the GM of the place. I don't lie to him, I give him my best estimate of the business I can provide, and we go from there. If he decides that he can survive on $20/night (never actually happened), I won't dissuade him :). Sometimes (as in my current assignment), he won't negotiate at all. In that case I go somewhere else.

The point (and I think it's been discussed here many times before) is that misuse of codes for which you would not normally be eligible is an ethical grey area -- black for some and white for others. For me personally, I prefer to have things visible on the table -- otherwise, I would have nightmares about coming back one night and finding my stuff piled up in the lobby and some guy from Marriott security wanting to talk to me about back-billing and so on. Not a happy thought.

As mentioned earlier there are many many factors that go into pricing an account and doing exactly what you do, giving as much data about your needs as possible, is the best thing you can do to negotiate a rate. My personal views about this "gray" area have been stated before and I'll save you all from hearing it again (or using any examples to make my point as we usually just end up discussing the examples and not the point).


Just to be clear: Individual companies travel programs while usually similar to others do typically also have unique points about them as well.

Also to point out, unlike widgets a hotel's rooms are fixed, buy too many and you reach a point where the discount a hotel can provide begins to decline.

I am currently on a long term assignment, and the company I am consulting for has a policy that does not allow associates to have hotel stays or other travel discounts that are not for our own company. I think they do this for a few reasons -- namely, ethics, to assure we are not getting favors, and to make sure we get credit for hotel stays for negotiating in the future.

In this case -- even though I prefer Marriotts in many cases -- it would be pretty lame to get fired (contract pulled) for using another companies rates.

Sometimes there is more than just the rate check at the front desk to worry about.

Why should such a post cause some waves. This is very simple. You either qualify for the rate or you don't. If you do qualify, use it. If you do not, then you should not use it.

If you use a rate code that you aren't entitled to use, then my sincere hope is you get busted. It is really is no different than stealing, and in the end the rate I legitimately pay will go up.

Enough said.

Thanks for sharing a message that was long overdue.

chopping and crying
 

[QUOTE=Marriott_Guy]
I have said before that I thoroughly enjoy hearing my guests (and best guests - Marriott Reward members) onions on this forum.

Great post, but I'm not sure I want you to know about my onions!

I agree. The only exception would be if you ask the property in advance if it is okay to use the rate code.

I think you certainly have a valid point, but the bit of information quoted above suprised me. Many of my contracts have expenses billable to the client. In this case, the client often requires or requests that I book whatever hotel they have a negotiated rate with and use their corporate rate. However, they don't do the booking for me, I (or my travel dept.) eithers calls the Marriott desk and says we need the XZY corporate rate or if we know the online code for the XYZ company we book it online. The company who's corporate rate I have to use has no involvment in booking my travel, so I'm not sure how they could come up with a number of nights booked to compare with Marriott.

I for one make it a point to only use codes for which I qualify (m11 etc.). I've never used a code assigned to a specific corporation.

My son, on the other hand, (also a plat) is in a business servicing a number of corporate code holders and has been encouraged by a couple of his clients to use them. In other words, he's in town specifically to provide services to "xyz company" and has always stated this when checking in.

The only time he was questioned was at the full-serve Marriott at Overland Park, KS (Kansas City)....where he was working with Sprint. He was asked to produce a letter to that effect from Sprint. He provided that the next day. It went into the hotel's database, and he hasn't had a problem there since.

I see 3 ways of looking at this:

1 - I have never used a corporate/government code that I was not entitled to use even though I am aware of all the codes published at this website (and the fact that many of the codes are not especially difficult to crack – e.g. IBM). Many economy and mid-range hotels do ask me for ID if I book an AAA rate… and it does not bother me in the least to be asked. If abuse of these codes is becoming a problem… simply ask the guest for their form of payment and company ID. This is not out of line in my opinion…. and it would take no more than a few extra seconds.

2 - There are very few occasions I’d ever even want to use such a rate. When I’m traveling for business and expense everything, I really have no personal incentive to use anything other than my legitimate company rate, or other public rate. When on leisure travel… there are very few cases when a corporate rate will be lower than other rates for the times I do my leisure travel (often weekends). That goes for my companies negotiated rates or any other companies rates I have checked from time to time. On those rare occasions when the illegitimate corporate rate is lower than the prevailing public rate (for example this weekend at The Marriott Long Warf in Boston)… it is still usually more than I want to pay, so I’ll use points or stay someplace else (I’m staying at the Marriott in Cambridge which still works out way less).

3 – Finally, I have to be honest and say if I knew I could get away with it … and if it saved me money and there was really no other alternative… I could rationalize using an illegitimate code. When I call a hotel, airline, or car rental they try and charge me as much as they can. I’d bet a million dollars there are more people staying in Marriott hotels tonight paying a rate that is higher than they could have otherwise legitimately booked if they had known about it than there are people saving money by using an illegitimate corporate code. And my final thought on this is perhaps the Marriott Long Warf in Boston really would like me to book the illegitimate rate this weekend… if I did they would have any extra $179 a night they might not otherwise have.

I consult for many firms that request I use their corporate code, but I tend to look at both the code for my firm and for the client, to see which is better. It is to the benefit of the client that I work between the two and, oddly enough, even use my AAA code.

I think the issue here is the misuse of codes. We all know that there's a sticky with several pages worth of corporate and promotion codes. The question is, is it right to use if you're not engaged in a legit activity related to the code?

I think it's a lot like speeding. Feel free to use the codes, but, for the love of god, don't whine if Marriott calls you on it. There's nothing like listening to someone who gets snagged cry about inequity of being caught.

deleted

This describes my situation exactly. One thing - if you book with Marriott directly then it is non-commissionable so Marriott makes a few extra dollars on the deal. Sometimes I have had to call the client's travel agent in order to get their corporate rate, which makes it commissionable.

I do appreciate Marriott_Guy's thoughts on this, however.