The Hotel Rate Ethicist: Corporate Discount Codes, and Your Advice Needed on Whether I Should Renew AAA Membership?

I’ve had AAA membership for awhile, largely because I book AAA rates at hotels frequently. I don’t think I’ve ever been asked for proof of membership at check-in, however.

The Hilton and Hyatt websites both ask you to enter AAA numbers when making reservations online, they don’t check that an account is currently active but presumably check to see that the digits are plausible.

AAA rates aren’t always the best, for instance there are often better corporate rates where if you were an employee of a given company you’d be entitled to a lower negotiated rate — which sometimes codes with added benefits like free or discounted parking, or a much more generous cancellation policy than standard reservations (such as 6pm on day of arrival rather than day prior to check-in).

I’ve never been asked for ID on a corporate rate when checking in, either, although I understand that it’s quite common to be asked for proof of eligibility for a company rate at hotels in Asia, and I do know at least one hotel chain revenue manager that has had his hotels ask for ID (a business card, or at least something with the company’s logo or other identifying marks on it) at check-in for certain rates that are exceptionally good though this practice is very rare in the United States.

It’s certainly ethically questionable to represent yourself as working for a company that you do not in order to obtain a discount to which you would not otherwise be entitled.

On the other hand, you aren’t taking away discounts from others — on the contrary you are boosting the volume of business the company appears to be doing with the hotel chain, helping them to continue to justify such a deep discount in the first place. And hotels actively manage inventory, most of the time whether you book a room at a discount or a higher rate it’s the overall occupancy and projections of how many rooms they’ll sell on a given night that determines whether they open up inventory in the ‘bucket’ that each corporate rate draws from (rather than there being a fixed number of corporate rate rooms per night).

Different folks will approach this issue differently, my tendency is to book rates I’m entitled to.

AAA rates are pretty widely available and one doesn’t have to be an employee of a particular company to be eligible for them. On average I find that the rates are about equal to advance purchase rates, but are cancellable. I’m generally allergic to prepaid rates because my plans change, my preferences for where I’m going to stay change, and because rates may fall after I’ve made my booking and I like to re-check pricing as travel approaches.

With Hyatt some hotels also frequently offer ‘AAA Breakfast Rates’ that are about the same price as the regular AAA rate and advance purchase rate that also throws in breakfast, something I get as a Diamond member of Gold Passport but that would be quite useful otherwise.

Since I use the rates enough to justify paying for the membership, I actually do pay for the membership in order to actually be eligible even if no one is checking.

Years ago I had a AAA membership — when I turned 16 and for a few years thereafter — because my first cars were quite the adventure. I started off with a Renault Alliance that my family paid $800 for and that had electrical problems. It was replaced by a Mercury Topaz with over 130,000 miles on it. I got great use out of the roadside assistance and towing benefits of membership!

But since then I don’t use it for much more than the hotel discount. So I recently let my membership lapse, figuring I’d pick it up again when I saw a good promotion, and especially since I didn’t have immediate upcoming bookings where I’d need to assuage my conscience.

Something arrived in the mail on Friday though that creates a new crisis of conscience for me:

AAA sent a direct mail package to me as a lapsed member, trying to get me to re-up. The package included a membership card, valid through May 1 2014.

Presumably they find that the response rates are higher when they actually send the card.

Now I don’t even have to join to have a AAA card if ever asked. At least for the next 15 months.

So what say you, do I send in my money if I’ll be using the discount?

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. I believe in fundamental travel karma. Treating people nicely and doing the right thing tends to lead to better opportunities, better seats/rooms/schedules, and being an ass always lands you in trouble, especially when IROPs occur. However, I agree that this post isn’t really about how you treat others and your using this benefit doesn’t directly hurt others.

    However, character is who you are when nobody is looking.

    As the AAA rates will likely save you over $40 annually, you should pay for the membership as a thank you to the company that has to pay people to negotiate the rates. While you are helping to give them the size needed to negotiate rates, you are using a service that they sell through membership. By not renewing, and passing yourself off as a member, you are not being honest, and in essence, stealing from the company. It’s a small price to pay for the benefits, so get a little good karma, and maybe you will use them one day if your car breaks down.

  2. I don’t think you’re morally obligated to renew your annual club membership. The rates AAA is able to negotiate with the major chains is (presumably) based on anticipated volume brought in by AAA advertising these negotiated discounts. For purposes of AAA’s negotiated hotel rates (not for purposes of AAA’s bottom line), your paid membership with AAA is irrelevant if your actual membership doesn’t change your hotel purchasing behavior.

  3. Curious what you use as an alternative for potential towing purposes? I know a lot of cards offer free roadside assistance but all i believe that is is a hotline you can call and then they call a towntruck company and you get the fat bill. I consider AAA to be more like an insurance policy, I may not get my money’s worth of towing every year, but even if I have a modern car that should never need to get towed I am still just as likely to run over a nail and lose a tire in the middle of a storm on the side of the highway and have no interest in changing it myself.

  4. In your heart, you know what to do. Unless something’s gone terribly wrong and you’re flat broke, pay the $40 if you keep the card. AAA is a great organization (like you, I had a few unreliable cars and used them a lot) and is well worth supporting.

  5. if you are going to use the rates, pay the $40, i assume you can afford it.

    when hotels have honors bars do you typically pour yourself a drink and not pay requested amount? same principle.

  6. I believe everyone who owns a car should have an AAA membership (unless they get roadside assistance via some other source). $40 is NOTHING in the total annual cost of owning / driving a car. And it doesn’t matter how new your car is, you can still get a flat tire along an interstate in the middle of a snowstorm!

    And in other news, I thought I heard you once consulted for IBM? 🙂

  7. As others have noted, I do see a difference between the AAA rate and a juicy corporate discount. I see it as kind of like those senior citizen discounts that certain places offer – 5-10% off, seldom enforced to the letter, and usually not THE best deal in town if you’re trying to save. There is some bad karma and you will likely make up the $40 in hotel savings over the year, but I don’t think that alone is a mortal sin.

    OTOH, the corporate discount part is a bit problematic. As mentioned in the article, AAA discounts probably don’t induce much, if any, demand at all. So it that sense they are a wash. But a big corporate discount and any freebie perks definitely could be a game-changer. You could of course be helping that company by boosting it’s apparent spend for the year, possibly helping them keep a good “status level” with the hotel chain. But here the karma and potential consequences are much greater:

    1. You are definitely taking advantage of something others don’t have access to, and possibly distorting the market for that hotel’s rooms (e.g., what if your room is the last in the cheap buckets and after that only top-tier rates are available). This is mostly just karma.

    2. This is outright false representation if you indeed don’t have the implied affiliation with that company. I see levels to this, such as if you recently left (you’d still have some leftover business cards or company materials to “prove” relationship with that company), or if you do work for them but it states “company-related business only; no personal travel allowed” and you use it for leisure trips as well. If you were discovered, someone at that company could face punishment for giving you the code, not monitoring to see that their benefits were used appropriately, etc. So to me that is a much graver concern. But it still all boils down to karma, as long as you didn’t outright steal the code or something.

  8. On the AAA membership, I think you know the right thing to do.

    On the using corporate codes, actually there is a victim from whom you take away a discount: the other employees of the company whose rate is being used. If there are only 20 rooms blocked at the corporate rate, the legitimate employee of the company may be blocked out because non-employees are using that rate. I’ve seen it happen. The person legitimately entitled to that rate is locked out because the rate code is sold out.

  9. There is a difference between taking advantage of every legitimate deal you can, and cheating. I love the fact that so many people on this thread get the karma aspect of that, and walk the talk.

  10. Gary,

    Careful using the auto insurance towing. I used it then when my policy was close to ending and I was shopping around I found out it counted as a claim.

  11. Even though some credit cards and new cars come with the roadside services, in my experience nobody is better at it or as reliable as AAA. It is well worth the money, which is a nominal annual cost.

  12. I find AAAnmembership is useful and worth the pittance. Too many dead batteries in New Zealand fixed in 15 min; quick tire change in the pouring rain; ability to avoid the DMV office here in CA.

    I also have found AAA rates actually taken far exceed my annual membership cost, so it’s essentially free. No brainer: not only is it ethically correct to join and pay— it is wise to do so.

  13. This isn’t just an ethical issue. It’s foregone revenue to the hotel that you’d be appropriating for yourself based on false pretenses. I’d think one would view this the same as making off with bedpillows.

  14. don’t get me wrong, I stand by my original post, but who is the burden on? Is the burden on the hotel to ask you for proof, or is the burden on the consumer not to lie? If a hotel is “lazy” should they suffer the lower revenue? Or because you agree when you book that you meet the conditions of the rate the ethical burden is on you?

  15. Since you said “years ago”, I’m guessing you might be over 50. I joined AARP, and find that the discounts there are similar to AAA discounts, and good for many other things as well.

  16. I am rarely asked for proof of my AAA membership when checking into domestic US properties (although it has happened 1-2 times over the past year), but I have definitely been asked at some hotels abroad, such as in mainland China. (In fact, in China they even photocopied the AAA card! But that shouldn’t be a surprise as they seem to insist on photocopying everything there, including your passport.)

    If someone is going to use a AAA rate, they should just pay the rather menial $40 annual fee. I am also a believer in travel karma, and I could see that the one time a non-member is asked for their AAA ID, it is during a sold out weekend when rates are high, and the property attempting to charge them the then-rack rate if they want the room.

  17. I’m a big AAA fan, regardless of discounts. Even if you are a passenger in a car which breaks down, your AAA membership entitles you to roadside assistance. The fee is well worth the peace of mind.

  18. I hate to see how many people will compromise their ethics just to get a good deal on a hotel room.

  19. I wish my AAA was only $39.00 a year. Mine is $50.00. If it goes up next year I’m not renewing. I can get the same discount with my AARP card which is alot cheaper per year. Car Insurance covers towing so the only thing Id be missing is maps.

  20. @Randal L Schwartz – years ago to me means ~ 20. I’m not over 50. But plenty of young folks join AARP for the discounts 🙂

  21. @Noah, the ethical burden is always on us as far as honesty and karma are concerned. But it also comes down to what we’re talking – getting a AAA rate that’s say $127.86 a night vs. $132.65 (assuming no perks like breakfast lumped in on the AAA rate), or using a corporate discount under false pretenses to save $100 or more on a room and get a few perks like free parking and breakfast as well.

    Again, there’s little at stake AFAIK with using a AAA rate. In essence you’re rolling the dice, knowing full well that 99.9% of the time no one is going to verify your AAA status. But there could be major consequences and/or distorted demand (legitimate business users unable to book after your room) in the corporate rate scenario. So to me there is an element of it being on them to make sure they don’t lose $5 for you claiming a AAA rate, and I would imagine thare are very generous rate bucket allotments for the AAA rate among others like AARP, so the net impact of one room is minimal. However, when people could get in serious trouble or get seriously inconvenienced in the corporate rate situyation then it’s much more on you.

  22. Couple of years ago I asked a similar question on Flyertalk: is it unethical to book a conference rate for a hotel and then not pay a conference registration fee (and of course not attend the conference)? Several posters responded then saying that the conference organizers really don’t care as long as they sell out their block of rooms. Do other people see it that way?

  23. @ Gary– Marriott and Hilton offer AAA rates in Asia (usually somewhere between the best available flexible rate for the day and the pre-paid rate); I haven’t seen any AAA rates from Hyatt or Starwood outside North American, however.

  24. I don’t make decisions around karma, and I’d not teach my kids based on it…that’s just me. I do make decisions around right and wrong. It really seems like no one gets hurt here though…that makes it s bit tough. In the end, I pay for my AAA card each year and know I’ll pay for the membership through hotel savings just as you’ve said here. Seems like the least I could do for them helping me save hundreds is to give them a few dozens so they can keep doing what they do.

  25. Ethical behavior can usually be found via by asking this question — what would the world be like if everyone acted the way I do?

  26. Gary, I want to receive the AAA direct mail and enjoy the 15 months free period. Please let me know how to get it
    Thanks

  27. Westin Stonebriar (Dallas) and Westin Edina (Minneapolis) will both ask for proof of AAA or corporate rate, take note

  28. AAA tried to make me upgrade my membership to a higher tier and sent me the card for the next level up. I’m iffy on whether that really counts or not. I may pay to be a standard member, but using a Plus card without paying the extra surcharge is still disingenuous. I threw it away and kept my standard card since that extra boost wasn’t necessary.

    I will point out that while no one has asked me for the AAA card when I check in, Hyatt routinely asks for my card number when I make the reservation.

  29. Scottrick, I’m a plus member only because I wanted to have the longer towing distance for my wife in case she had an issue while I was traveling. My recollection of the terms is that most of the things you’d use a “plus” membership for are direct interactions with AAA wherein they’d probably know you weren’t entitled to the plus benefits.

    As to the original question, I’d agree with most here to recommend paying for it. I will say that my one interaction with my insurance company on a towing request was significantly more cumbersome than any AAA experience I’ve had since. Just for that alone it’s worth $40.

  30. Of course you should pay the membership fee if you are taking advantage of discounts for the members.

  31. Seems that any discount one is not entitled to is one you should not try to get. There are plenty of sales, prepaid rates, etc. you can take advantage of. Ultimately, this is travel, not an essential service or food. Seems like cheating on rates is a bad idea, example and practice.

  32. I know hotels offer corporations a discount so that they can be a preferred hotel in order to get their business. But it kinda sucks when I need a room for business and I have to pay more than others for the same room.

  33. Just a little lie. . .right? Not so. If you will lie to one, you will lie to another. Do you want to be trustworthy?

  34. First, I would be very tempted to just carry the card and not pay. I’ve done something similar: carrying an expired AAA card just in case someone asks.

    Second, there are many reasons why a legit corp rate user would not have ID: an interviewee, for example. Or a guest visiting the corporation.

    Third, there are some other rates than rival AAA: Hyatt has a deal with Costco which tends to give a AAA-equivalent rate and you can find the code for that very easily.

    Lastly, and most important: keep in mind that most hotels are constantly playing games with prices, and it’s the one-room-at-a-time traveler who usually gets the short end of the stick. They’re attempting to do market segmentation to maximize how much they extract from you, but they’re still happy to sell rooms for a fraction of the “best available” rates. Given the extent of their pricing games, you don’t need to feel guilt at attempting to game them back. I’ve seen hotels with $150-200 “best available” rates be booked through priceline for $45. If the hotel is willing to sell rooms for $45, shouldn’t they be delighted to get $120? I’ve also stayed at nearly-sold-out hotels for corporate rates that were less than half of the advertised “best available”.

  35. AAA fanboys might consider researching their lobbying efforts. That aside, among the seedy underbelly of the tow-truck industry, I agree AAA is a saint.

    I (also) live in NoVA and use to be a member, but their rates here are seriously uncool. Esp when USAA offer roadside assistance for a few dollars a year. Buying AAA for it’s discounts makes me scratch my head – is that what they’ve become? A discount club? I’m not sure how much I agree with cost-shifting due to discount clubs in the first place, but I am definitely curious how the business model works.

    I think people take issue with claiming AAA membership rates because it’s lying. I’m not sure that there is harm, however. I don’t claim AAA rates, but I’m not opposed to it. It’s curious that more and more, supply and demand meets price discrimination. That seems to be the issue here, whether its defendable and just, I’m not sure.

  36. I pay extra for the AAA Premier membership which gives me a towing upgrade. Seriously. I get one 200-mile tow per year plus 3 more tows of up to 100 miles. That covers 95% of my driving needs. Recently an alternator quit working at night 107 miles from home. AAA towed it right to my house, where I was able to fix it a few days later after the ebay replacement parts arrived. Saved me at least $400 and an out of town overnight stay, and I know the problem was fixed correctly and completely.

    Elite membership isn’t just for airline and hotel programs!

  37. I have an ethical dilemma with some BRG claims I got through, they rates just so cheap it’s almost daylight robbery. I will live with myself though 🙂

  38. I say pay it back, pay it forward. The lower rates you enjoyed when a youngster was supported by other paying their way. Help others out by paying your share.

  39. I agree with the many readers who feel we shouldn’t take advantage of deals to which we’re not entitled. There might be a subtle difference in this instance, though, in that AAA sent Gary an actual membership card that he did not request. Legally (and also ethically in my opinion) if a company sends you something in the mail that you did not order – usually as an enticement for you to take some action – you have no obligation to either pay for or return it. Companies know that is the law, and they take that risk because their marketing people believe it will pay off for them. So in this particular instance I do not feel it would be unethical for Gary to use the card – which was sent to him without his requesting it – without paying for it. To claim a membership in an organization or employment by a company, when those are not the case, is indeed wrong.

  40. Here’s what I do. I just steal something from each hotel-a towel, an unpaid item from the minibar, maybe an item from the front desk when no one is looking.

    Thus I am a thief just like those who take rates and bennies they’re not entitled to. But at least I don’t have to wade through long diatribes pondering my ethical compass.

    Hey-I’m a thief.

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