What are the advantages and disadvantages of overbooking?

Advantages of overbooking in hotels
  • Mitigating losses.
  • Achieving full occupancy.
  • Compensation is cheaper than having empty rooms.
  • Availability of prediction methods.
  • Negative guest experience.
  • Potential poor publicity.
  • Take advantage of big data to make informed predictions.




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Cons of Overbooking
  • Do expect a guest review that may affect the reputation.
  • Additional financial loss as other guests stay in a hotel might use other hotel facilities.
  • Guests that move may have a negative thought about your hotel, so it is not suitable as a long-term strategy.


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As a result, airlines can, with a degree of certainty, overbook a flight considering the number of no-shows expected, thereby maximizing the capacity available to customers. For consumers, this practice is beneficial because it allows more consumers to fly at the time, date and fare of their choosing.

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Consequently, a bad overbooking strategy can cause a lot of damage and a whole lot of stress: from guests to associates. It often leads to bad online reviews, harm to your online reputation, financial loss, and “real-life” complaints. Nevertheless, a good overbooking strategy can bring many benefits.

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Usually when a hotel is overbooked, the manager will make arrangements to send you to a nearby property and cover the cost of that room and transportation to get you there. Behind the front desk, that's called walking the guest—as in walking them to a different hotel.

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Whether you're flying from New York or New Orleans, Lisbon or London, airlines continue overbooking to compensate for “no-shows” all the time. Simply put, they sell more tickets than they have available seats. And it's not an illegal practice.

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Intentionally overbooking means your hotel will have more reservations than available rooms on a given day, but based on historical data or booking trends, the expectation is that some guests will cancel or not show up, opening up rooms for the overbooked guests.

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The risk that expected cancellations might not take place and some guests might not find available their reserved rooms is the reason why overbooking is considered a controversial practice, unethical for consumers.

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For example, an airline overbooks a flight in expectation of a certain number of passenger no-shows. Similarly, a restaurant overbooks its seating reservations, since some patrons never show up for their reservation slots.

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Whether you're flying from New York or New Orleans, Lisbon or London, airlines continue overbooking to compensate for “no-shows” all the time. Simply put, they sell more tickets than they have available seats. And it's not an illegal practice.

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is delayed by more than two hours beyond its scheduled departure time, or cancelled. Ryanair, as a policy, does not overbook its flights.

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Carriers have been overbooking their flights for decades as a way to maximize income. According to Tech Crunch, on average, 5% of travelers miss their flight, and there are some situations where up to 15% of passengers do not show up.

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Is overbooking legal in Europe? Yes. The air carriers in the EU countries can overbook flights and trade more seats than they have available on the aircraft. If your flight is overbooked and you are denied boarding, you may ask for airline passenger compensation.

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Overbooking flights in the US
Here's what you need to know: Only boarding denials due to overbooked flights are covered. US regulations are quite strict: passengers are only eligible for compensation if they are denied boarding due to the airline overbooking the flight in question.

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