As we all grapple with how best we are going to re-start travel once the vaccination programme’s kick in and travel restrictions are eased, one question has come up several times – what cancellation policy should be in place for customers.
There’s no easy, right or wrong answer, in some regions policies will be led, or at last influenced, by existing legislation, but for most regions the operator is free to set their own policy. It can seem a minefield, and after such a economically traumatic year, the temptation is to ensure your own interests are secured first, so setting cancellation terms that are favourable to you as the operator so as not to lose money. For many large operators, cancellation gains (the money kept from customer’s who cancel/no-show) have long been treated as not insignificant source of additional revenue.
But times have changed, (and in some regions in the last few years, legislation changed to ensure customers would be refunded fairly). Now, more than ever, the customer really is in power. Habits are changing; we saw from last summer, when some regions were lucky enough to be opened up, last minute bookings were the majority of the business as people made decision much later based on their own personal circumstances and the changing restrictions.
So, how should your booking policy reflect the new booking patterns we are seeing? Our view is that flexibility should be at the heart of your policy. Customers will remember if you treat them fairly and are more likely to be loyal, and they will both remember and harbour resentment and anger if you refuse a change or a refund.
Our top tips for structuring your policy are simply to make itFAIR.
Let us explain the four pillars further:
Flexible– your policy needs to allow the customer to make changes as often as they like, cancel with a refund if need be, as close to departure as possible, or at least on a timeline that is fair to both parties. Our only certainty is uncertainty. The world we live in now gives us no certainty at all that travel plans will go ahead. It’s neither the operator’s fault nor the customers fault, if they suddenly can’t travel due to covid-19 restrictions. So we advise being fair to the customer and allow hassle free changes. They will remember it and are much more likely to come back to you once their travel plans resume. By all means promote and offer credit notes/changes before refunds, but don’t get into a fight with a customer if they want a refund.
Accessible– Put your policy front and centre of your website and social media. Make it easy for customers to find. Make it easy for customers to get hold of you, be it through chat, whatsapp, email, phone, whatever, just be open for business whenever they need you. Putting your policy with a strong and positive message front and centre shows the customer you are in control and want to help them. Along with putting your policy front and centre, make sure your booking terms and conditions are easy to find on your website. Its amazing how hard it is to find them on some tour operators booking sites.
Idiot Proof– use easy to understand language and descriptions of your how your policy will work.
Firstly, make it concise and easy to understand. This is excellent from Explore – “If you or a member of your booking party is diagnosed with COVID-19 or required to self-isolate and so is unable to travel, we'll waive our usual cancellation charges and refund any recoverable costs. So, you can look forward to your holiday without the worry”. Use a simple and reassuring message that immediately tells the customer they can feel confident to book.
Secondly, use simple language and structure your key points so the majority of your customers can understand it without having to contact you.
Thirdly, use an FAQ format and include as many questions as you can think of and ask friends and family to read it and confirm it makes sense. It will always make sense to you, because you wrote it – get a fresh pair of eyes to look at it.
Respectful– Treat your customers with respect, in both the way you communicate with them and how you structure your policy. Booking conditions have long been the place where operators can hide all their terms that favour them financially – charges to change a booking, fees for cancelling etc. Your policy needs to respect the customer, but also enable the customer to respect your right and necessity to run a business. It’s a very fine balance you now have to tread. You need to be fair and allow flexibility as much as you can, but you also need to survive and not put yourself in any more financial hardship. Which is why including phrases such as Explore’s above “refund any recoverable costs”, speaks to fairness and respect. If the nature of your business means some costs are not recoverable then it may be fair (subject to the legislation in your region) that you should not have to refund this to the customer. If you do this, then you really need to make sure the customer is aware of these types of non-refundable costs when making the booking. Non-refundable costs should be clearly stated at the booking stage and on the confirmation.
However, our recommendation would be that you do everything in your power to enable 100% refund when a customer cancels. Once Covid is over and travel patterns resume some kind of normality in terms of travel restrictions, then perhaps you can review your policy. But Covid has changed the landscape for a long time and operators who favour the customers in their terms will succeed ahead of those who don’t.
Some operators are buying and including COVID cancellation insurance for their customers. If you can afford to do this, or have room to cost it in to your tours, it’s a great way to provide cover for customers. Although not as positive as you underwriting the refund yourself (customers generally dislike the thought of having to make a claim on insurance, it’s seen a hassle), it does give you the opportunity for a good message. Popular with larger operators who perhaps have more fixed costs (flights etc) that they need to protect against cancellations for and so would be less willing/likely to offer full cancellation guarantees.
Here are a list of links to operators covid policies to give you some ideas and inspiration from others:
A lot of these are very large, multi-day companies, or even airlines. I’m aware they’re different from how most of us operate, but they have teams of people who create these policies and build the marketing messages for a living .. so I’d recommend learning from them and taking inspiration from the way they position their messages.
Trafalgar (The Travel Corporation) - https://www.trafalgar.com/en-gb/about-us/worry-free-travel/your-flexible-and-risk-free-booking
TUI – https://www.tui.co.uk/destinations/info/our-promise
Jet2 – https://www.jet2holidays.com/speedy-and-smooth-refunds
G Adventures - https://www.gadventures.com/book-with-confidence/
Just You - https://www.justyou.co.uk/about-us/reassurance-guarantee/
Explore - https://www.explore.co.uk/book-with-confidence/covid-19-refund-promise
Intrepid - https://www.intrepidtravel.com/uk/flexible-bookings
Sunwing - https://www.sunwing.ca/pages/en/covid-19-insurancepop
Saga - https://travel.saga.co.uk/holidays/book-with-confidence.aspx
Tour Radar - https://www.tourradar.com/mlp/travel-advice-novel-coronavirus
Globus - https://www.globusjourneys.com/peace-of-mind/
Worldstrides - https://worldstrides.com/travel-with-confidence/
Agrigato Japan - https://arigatojapan.co.jp/about-us/information-surrounding-novel-coronavirus-covid-19/
Highland Explorer tours - https://www.highlandexplorertours.com/essential-info/book-with-confidence
Kuoni - https://www.kuoni.co.uk/press-room/news-archive/coronavirus?refresh=true
Neilson - https://www.neilson.co.uk/covid-19-promise
DerTour - https://www.dertour.de/aktuelles-angebote/sicher-super-sorglos
ABTA - https://www.abta.com/news/coronavirus-outbreak
Bindlestiff Tours - https://www.bindlestifftours.com/corona-virus/
Southwest Airlines - https://www.southwest.com/Coronavirus/
Highland Expeditions - https://highlandexpeditions.com/travel-with-confidence/
InnTravel - https://www.inntravel.co.uk/information/coronavirus
Headwater - https://www.headwater.com/all/book/book-with-confidence.htm
Euroventure – https://www.euroventure.com/book-with-confidence/
Go Cotswolds - https://www.gocotswolds.co.uk/covid-19-book-and-travel-with-confidence/
Craig Travel - https://craigtravel.com/book-with-confidence
Centreparcs - https://www.centerparcs.co.uk/information/book-and-stay-with-confidence.html
American Holidays - https://www.americanholidays.com/en-gb/about-us/book-with-confidence/