What is a Booking Fee? 6 Facts You Need To Know

In addition to the base price, a booking fee is charged for reserving transportation, lodging, a seat, etc. in advance. Let’s click on each section below to read more information regarding a booking fee. 

What is a Booking Fee?

A booking fee is the common practice of charging extra money when booking a trip, purchasing concert or theater tickets, or purchasing an airline ticket. When purchasing tickets, vacation packages, or reserving hotel rooms, a variety of travel companies, including a large number of online businesses, may assess a booking fee.

What is a Booking Fee?

The only way to avoid booking fees when purchasing tickets for events, plays, and concerts is to do so at the event’s door. However, tickets for popular events are typically unavailable on the day of the event, so consumers are willing to pay a premium.

How Much is the Booking Fee?

A few booking fees are reasonable. A flight reservation fee may cost between $10 and $20 USD (USD). Other companies charge a booking fee based on a percentage. In recent years, however, consumers in the United Kingdom have been surprised to learn that fees for purchasing play tickets can account for up to 25 percent of the total price, and many have demanded greater transparency regarding these fees.

In addition, online travel agencies that offer discounted rates if you book with them may not be such a great deal if they charge an additional fee. If the hotel does not charge these fees, booking directly with the hotel is typically less expensive.

Many businesses, including travel and ticketing services, derive the majority of their income from booking fees. The existence of price gouging and the appropriateness of these levies are questioned.

According to a variety of business periodicals and news sources, these costs are on the rise. On the other hand, it’s difficult to hold a travel agency accountable for a small booking fee if they’ve spent several hours assisting you with vacation planning.

Yet, a $25 USD booking fee seems excessive when a concert ticket costs around $100 USD and it takes three or four minutes to purchase one. Similarly, it is difficult to justify booking hotel rooms or airline tickets through the airline or hotel chain that you intend to use.

What is a Booking Fee?

Since you are already paying the hotel or airline for their services, many believe that booking a stay or buying a ticket should not incur additional fees. Some companies, such as JetBlue®, will only charge a booking fee if the flight is booked over the phone. Internet orders are not subject to any additional fees.

How to Save On Booking Fee

To save money when traveling or purchasing tickets, search for agencies or organizations that offer low or no booking fees, and compare costs between agencies that claim to save you money and the cost of making your own hotel reservations.

Despite the fact that membership fees are required, a membership with a travel company, such as AAA® (American Automobile Association), may also save you money on travel expenses. Additionally, you should inquire in advance about any fees. If a company refuses to disclose all of its fees, look elsewhere for one that will and that offers minimal or no booking fees.

When purchasing concert tickets, you are effectively compelled to pay whatever prices the ticketing agent desires. Frequently, ticketing agencies have the exclusive right to sell tickets for a particular event. Typically, your only options are to pay the additional fees, skip the event, or enter a radio or television contest in the hopes of winning free tickets.

Should you charge your customers a booking fee?

No one enjoys booking fees, transaction fees, resort fees, or service fees by any other name. This is particularly true for “surprise” fees that only appear at the end of the booking process, a tactic frequently employed by Ticketmaster and Seatwave.

What is a Booking Fee?

A quick Google search for “How to avoid hidden travel booking fees” yields over 35 million articles discussing the numerous hidden fees that consumers frequently encounter. The “print at home fee” that Ticketmaster charges for printing tickets at home is my favorite.

It is essential to realize that your clients are searching online for ways to avoid incurring these costs. If there is no way to avoid it, they may completely avoid your services.

According to Which?, a British consumer rights organization, four out of five customers believe that high ticket prices are a rip-off, especially when they are not clearly justified.

Ticketmaster discovered in 2010 when they published a blog post justifying their exorbitant booking fees that customers don’t really care why they are charged. The prevalent sentiment toward Ticketmaster was, “Stop attempting to make us care.”

Legislators believe that by separating the various expenses and taxes, ticket sellers, hotels, and airlines will be able to market their services for less than their actual costs. To combat this in the United Kingdom, all information regarding ticket prices and additional fees must be disclosed.

Politicians in the United States are investigating hotels that add “resort fees” to room rates without disclosing the total amount beforehand.

For tour and activity operators, booking fees could hurt your business.

1. It adds up

Consider a scenario in which a customer books a skydiving excursion directly through your website for $175. The amount quickly increases to $185.50 after a 6% online booking fee is added. A consumer must pay more than $10 to book a vacation with you online (which is meant to be more convenient for both parties, incur zero paperwork, and improve your services).

Despite the fact that this may not be an issue for luxury travelers, the additional $10.50 would certainly deter some clients.

2. Customers who book through OTAs can cost you more

Using Google and comparison shopping, customers who are unwilling to pay the additional costs can easily find alternatives that are more affordable. They may even look for your company on an OTA with “low price guarantees” such as Viator and book your trip there.

What is a Booking Fee?

Consider the following:

  • Your website indicates that the Private Family Tour costs $300. Your customer will pay a total of $321, which includes a 7 percent booking charge. They turn to Google to look for alternatives since they don’t like what they find.
  • Your same trip costs $300 on an OTA site with no additional fees, so they pay a total of $300 and save $21 in fees.
  • However, the OTA charges a 25% commission each time your tour is booked, so you pay $75 to the OTA for their services and make a profit of $225 (as opposed to the $300 you could have made with a direct booking).

Whenever a customer does this to save money, you ultimately end up paying for it.

3. You’re annoying your customers

Possibly the most obvious argument, you are irritating your customers prior to their booking.

Professional services and exceptional experiences are the foundation of tour operator and activity provider businesses. This includes providing a flawless online booking experience.

What can you do to deliver a great booking experience?

1. Include your booking fee in your total price

As an operator, you have the option of absorbing the booking fee or including it in the price of your trip and presenting the total amount. Keep in mind that your clients do not care why there is an additional fee and do not wish to be educated on something that is irrelevant to them. You are responsible for making their lives easier.

What is a Booking Fee?

2. Be upfront about your fees if you can’t include it in your total cost

If your booking system does not permit you to absorb the amount or include it in the final price, be sure to disclose the additional fee at the beginning of the booking process or in the product page’s fine print. Alternately, you could search for alternative booking systems that give you complete control over the pricing of your excursions.

Conclusion

A booking fee is any payment made for a booking, such as an appointment or an event. When a client schedules an appointment with your business, he must pay a booking fee.

Typically, the booking fee is a percentage of the total cost. If it is 1 percent, for example, it means that the customer pays a 1 percent booking fee.

Occasionally, a booking fee is charged for certain services. For instance, if the customer requests a specific time, location, or number of attendees, this request may incur additional fees.

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Pat Moriarty
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