Wednesday, July 13, 2005

Hotel overcharging. It's not an accident...

...it's part of their business model.

I posted previously on unexplained charges that had appeared on my hotel bill when staying at the Charles de Gualle airport Radisson SAS. According to a recent article in USA Today nearly 12% of hotel bills are incorrect.

The article suggests that these are honest mistakes but also notes that the majority are in favour of the hotel. Anyone with basic training in statistics will see the inconsistency. Honest mistakes ought to have a normal distribution (the famous bell curve), with just as many in favour of the traveller as the hotel.

The only other plausible explanation is that hotel chains have gone to a lot of trouble to ensure that their business processes don't produce undercharging errors, but much less effort to eliminate the systemic causes of overcharging.

Either way, hotel customers deserve a whole lot better.

Fortunately business models that are based on ripping off your customers don't tend to be sustainable in the long run. Look for someone to open a hotel chain with a "no overcharging or it's free" offer.

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