CUG (Closed User Group)

A CUG (Closed User Group) is a restricted audience — such as logged-in members, app users, or email subscribers — to whom a hotel or OTA can show discounted rates that are not publicly visible. Because CUG rates are hidden from general shoppers and metasearch comparison, they typically fall outside rate parity obligations, making them one of the few contractually safe ways to undercut public OTA prices. Common CUG mechanics include member-only rates on OTAs (Booking.com Genius, Expedia One Key member pricing), mobile-app-only rates, and loyalty or newsletter rates on a hotel's own website.

Example

A hotel's public BAR for a given night is €150 on all channels. On its own website, guests who create a free account see a member rate of €135 — a 10% CUG discount invisible to non-logged-in visitors and to rate shoppers. The same hotel participates in an OTA's member program, where the OTA funds part of a similar discount for its logged-in users. Public parity is intact on both channels, but each side competes for the logged-in customer.

Why it matters

CUG pricing is a central battleground in the direct-booking fight. For hotels, member rates are the standard tool for offering a genuinely lower price direct without breaching parity clauses — and for capturing guest data and consent along the way. For OTAs, loyalty member pricing drives sign-ins, app adoption, and repeat share of wallet. The risk for hotels is discount stacking and rate dilution: when OTA member discounts, mobile rates, and geo-targeted promotions layer on top of each other, the effective sold rate can drift far below the intended BAR, undermining the public price position. Revenue teams monitor CUG sell rates by channel to keep the discount architecture deliberate rather than accidental.

Related

• Rate Parity — CUG rates are the main contractual exception to parity
• Genius (Booking.com loyalty program) and One Key (Expedia Group loyalty program) — the largest OTA CUG programs
• BAR (Best Available Rate) — the public benchmark CUG discounts are applied against
• Direct Bookings — member rates are a core direct-channel conversion lever