Hilton Worldwide is following Marriott International’s lead and cutting commissions from 10 percent to seven percent for group bookings at “participating” hotels in the United States and Canada, effective October 1, 2018.
Danny Hughes, Hilton’s senior vice-president and commercial director, Americas, sent a letter yesterday to group intermediaries advising them of the change. In it, he wrote:
“At Hilton, we recognize the important and integral role group intermediaries play in our meetings and events business, and we are proud to partner with a wide network of travel professionals to create meaningful experiences for our guests. At the same time, we also have to balance the needs of all parties, and we therefore continually review our sales and distribution strategies to ensure we are offering the best value for our customers, hotels and owners.
In light of growing group distribution costs and the complexity of intermediary services offered, Hilton has revised its base group sales commission rate to seven percent for bookings into participating hotels in the U.S. and Canada, effective October 1, 2018. All existing business booked before October 1, 2018, will be honored at the commission rate previously contracted.
This change, whilst easing operations costs associated with group revenue, will allow our owners, over time, to make further investment in products and offerings that enhance the guest experience.”
On January 25, 2018, Marriott International informed group intermediaries that it would be reducing commissions from 10 percent to 7 percent for all properties in the United States and Canada, effective March 31, 2018.
In the aftermath of the announcement, it was reported that Marriott had given four very large intermediary group booking businesses a temporary exemption from the change. In response, SPIN: Senior Planners Industry Network started a petition demanding commission parity.