Hospitality service providers’ cancellation and refund policies significantly impact consumers’ interest in using their services again. In fact, 76% of consumers “agree” or “strongly agree” they are unlikely to return to a hotel, attraction or venue that denied their request for a refund, while 74% say they are much more likely to return to a host with lenient cancellation and refund policies, according to Merchant Refund Policies, a PYMNTS and Fortis collaboration based on a survey of 2,133 consumers in the U.S.
Get the report: Merchant Refund Policies: Keeping Travel And Entertainment On Track
In addition, 70% of consumers say they thoroughly review a merchant’s cancellation policy before reserving a room or buying a ticket.
Even consumers who get partial refunds say they are “very” or “extremely” likely to use the services in the year ahead. For example, among consumers who got partial refunds from hotels, 70% who were refunded 70% to 90% of their total cost say they are “very” or “extremely” likely to book a stay in the next year. The same is true for 62% of the consumers who were refunded 50% of their payment and 59% who received less than 25%.
The older the consumer, the more likely they are to “agree” or “strongly agree” that they are unlikely to return to a provider or organization that denied them a refund. The percentages range from a high of 85% among baby boomers and seniors to a low of 64% among the youngest demographic group, Generation Z.
About three quarters of the four older demographic groups said they are much more likely to book with hospitality providers that have lenient refund policies, with 78% of baby boomers and seniors, 74% of Generation X, 80% of bridge millennials and 79% of millennials saying they “agree” or “strongly agree” with that statement. However, only 55% of Generation Z consumers agreed with that.
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