Understanding Hotel Pricing on Who Sets the Rates? And Are Hotel Prices Guaranteed Not to Be Lower?

In the world of online travel booking, understanding hotel pricing and the complex relationship between hotels and Online Travel Agents (OTAs) can be crucial for both consumers and businesses. This article aims to clarify some of the key points regarding hotel pricing on and the concept of rate parity.

Who Sets the Prices on

The first question often asked is who sets the prices on According to the practices of OTAs, hotels typically set their own rates, known as the Best Available Rate (BAR). This rate is the lowest rate a hotel can offer for a room, including all included amenities and services. Hotels upload these rates to and other OTAs, which then display them to customers.

Rate Parity and OTA Policies

The principle of rate parity is that hotels usually cannot offer lower prices on their own websites than what is listed on an OTA such as This policy is intended to ensure that all customers are treated equally and that the price displayed on the hotel's website reflects the same level of offerings. However, it is important to note that exceptions can exist and the policy is more strictly enforced in certain regions like the EU.

How Hotel Rates Are Set and Managed?

Hotels manage their room rates through various channels, including direct bookings, hotel websites, and OTAs. Typically, hotels upload the same rates to all OTA platforms to maintain consistency and avoid confusion among customers. This means that the price you see on should be the same as the price on the hotel's own website, barring any special promotions or discounts that may only be offered directly by the hotel.

However, when a customer books through an OTA, the OTA may add booking fees, service charges, and other ancillary costs, which could result in the final price being higher than the direct hotel rate. It is therefore recommended to always book directly with the hotel if you are looking for the best price and avoid unexpected fees.

The Role of Online Travel Agents (OTAs)

OTAs like function as intermediaries between hotels and customers. They gather inventory and pricing information from hotels and channel managers, which are software systems that allow hotels to sync rates and inventory across multiple OTAs in real-time. If a room is sold through an OTA, the OTA takes a commission on that sale. Some OTAs might also purchase large blocks of rooms at a discount and resell them at a markup, especially in corporate travel arenas.

To summarize, the hotel is responsible for setting its own prices, but OTAs like may add additional fees, causing the final price to be higher. Rate parity clauses ensure that prices on the hotel's website and the OTA are consistent, but this is not always the case.

Rate Parity Clauses and Legal Considerations

Rate parity clauses in OTAs’ contracts have been a topic of debate, with some legal victories in the EU nullifying these clauses in certain cases. However, in most non-EU countries, especially the United States, these clauses are still enforceable. , as an OTA, does not enforce rate parity from a technical perspective, but businesses and individual travelers run the risk of legal action if they do not adhere to these clauses.

Strategies to Manage Rate Parity

There are various strategies to navigate around rate parity clauses, such as using channel managers and marketing tools to manage inventory and pricing effectively. These tools can help hotels stay competitive while adhering to rate parity guidelines.

For consumers, the best advice is to compare prices on both the hotel's website and , and to book directly with the hotel when possible to avoid additional fees and ensure the best rates.

By understanding the intricacies of hotel pricing and rate parity, travelers and businesses can make more informed decisions when booking accommodations online.