Old card, new rate
Question: I desperately need your help. I recently booked an apartment for eight nights at the Mercury All Suites in Miami’s South Beach district. I made the reservation over the Internet. About two weeks before my arrival, I received a confirmation by e-mail for a rate of $1,672.
I also called to check, and was told by a desk clerk and an assistant manager that my reservation had been processed. I was told that my credit card would be charged at the end of my stay.
Yesterday, only four days before my arrival, I received an e-mail from an assistant manager saying that my reservation had been canceled because my card had been declined. I recently changed credit card companies, and the hotel had tried to run the old card, which I’d canceled.
When I called the hotel to try to pay with my new card, I was told that the rate for the same room would be $2,802 — nearly twice the original rate.
No one has explained this price change and I’m so worried that I’m going to have to pay it because I can’t find another hotel for the dates of my visit. I tried speaking to the general manager yesterday, but I was kept on hold and then asked to call back. When I did, I was told that the manager had left the building. Can you help?
– Nana Fosu, London
Answer: If you confirmed your reservation by phone and in writing, then your hotel should honor your first rate. Raising the price of your room by $1,130 seems unfair, given that you made your reservation weeks in advance.
Some hotel reservations systems work a lot like those used by the airlines. You know how airline ticket prices change all the time? That’s called “yield management,” and it is dictated by a sophisticated program that predicts demand and sets prices accordingly. That’s why the price you pay two weeks before a flight leaves is usually dramatically less than the one you must pay the day of the flight. The system predicts you’ll be willing to pay more, and it’s usually correct.
Hotels often manage their room inventory in a similar way, i.e., the reservations system adjusts the room rate to get the most money for a room. You happened to book your room for a busy holiday weekend when demand was at its peak.
You handled this problem by the book. Getting the confirmation in writing, and calling to double-check, meant that you were covered. There was no way to know that the hotel would try to run your old credit card several days after it verified your reservation. In fact, you were told that you would be billed after the stay, but a subsequent e-mail from the hotel confirmed that you were required to make “a full deposit” when booking the reservation, which to me means you’ll pay for everything before you arrive.
I visited Mercury’s Web site and the only clue I could find that your credit card might be charged in advance was a vague notice that all reservations “require a valid credit card.” But I could see no mention of when the card might be billed.
According to the correspondence between you and the hotel, your reservation was automatically canceled when your old credit card was run. The Mercury was kind enough to notify you, but when you tried to make a new reservation, it charged you the newer — and higher - rate provided by the yield-management system. The hotel should have overridden its system and given you the first rate it had quoted you.
Next time you cancel a credit card, make sure you have no pending transactions. That will help you avoid complications like the one you experienced.
I suggested that you contact the hotel by e-mail again, politely requesting that it honor your first rate. I asked you to copy me on the note so that the hotel manager would know we had discussed your case. You received e-mail from Chris Rollins, a regional manager for the hotel, apologizing for the “misunderstanding” and saying your reservation is “fine and confirmed.”
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