Hotel booking sites slammed for misleading customers

You’re feeling smug.

You trawled all those hotel booking sites to come up, you’re sure, with the best possible deal on a lovely hotel room for your two weeks of bliss this summer.

You even snapped it up before those three other customers looking at the same page at the same time – according to the website – got their hands on it.

These are big business sites. Around 70 per cent of people who look for hotel deals use them thanks to claims that they can guarantee the best possible price for the hotel room of your choice.

Except that you may not have secured the deal of the century as you were led to believe.

This week the Competition and Markets Authority (CMA) is launching enforcement action against a number of hotel booking sites that it believes may be breaking consumer-protection laws.

As part of an ongoing investigation launched last autumn, the CMA has identified widespread concerns about the ways some hotel booking sites operate, including misleading discount claims, pressure-selling and screwed search results and rankings.

The government department, which combats anti-competitive behaviour, highlighted problems with features such as the way hotels are ranked. This includes the extent to which search results are affected by factors that aren’t relevant to a customer’s requirements such as the amount of commission a hotel pays the site.

The CMA was also investigating pressure-selling claims about how many people are looking at the same room, how many rooms may be left, or how long a price is available, which could create a false impression of room availability or rush customers into making a booking decision.

Whether discount claims made on sites offer a fair comparison for customers also came in for scrutiny.

For example, the claim could be based on a higher price that was only available for a brief period or not relevant to the customer’s search criteria, such as comparing a higher weekend room rate with the weekday rate for which the customer has searched.

Hidden charges, such as booking fees or taxes – the consumer’s nemesis – will also be included in the enforcement action for some sites and the letters sent to a range of others demanding that they take action to ensure they adhere to the law.

The CMA can either secure legally binding commitments from those involved to change their business practices or take them to court.

Andrea Coscelli, chief executive of the CMA, said in a statement: “Booking sites can make it so much easier to choose your holiday, but only if people are able to trust them.”

Holidaymakers must feel sure they’re getting the deal they expected, whether that’s securing the discount promised or receiving reliable information about availability of rooms. It’s also important that no one feels pressured by misleading statements into making a booking.

“That’s why we’re now demanding that sites think again about how they’re presenting information to their customers and make sure they’re complying with the law. Our next step is to take any necessary action – including through the courts if needed – to ensure people get a fair deal,” said Coscelli.

The CMA is also planning to refer concerns around online hotel booking sites’ price guarantees and other price promises to the Advertising Standards Authority (ASA).

The CMA has asked the ASA to consider whether statements like “best price guarantee” or “lowest price” mislead customers and what conditions must be met for companies to make such claims.

When the CMA launched the investigation in 2017, Ufi Ibrahim, chief executive of the British Hospitality Association, said in a statement: “Many of our members have been concerned about the vast power of online booking agencies often charging high rates of commission, use of misleading information, pressure-selling, and a lack of transparency”.

“In the process guests are paying more than they should for rooms. Contract terms also often include ‘narrow parity’ clauses, which restrict a hotel’s ability to offer a lower price on the hotel website than that offered to the online travel agent with which it has an agreement."

The news comes more than a year after EU investigators operating under the European Consumer Protection Co-operation regulations warned 235 travel websites that they would need to change the way they listed travel prices and deals for similar reasons.

Indeed, a wide range of comparison sites have come under fire for misleading practices like these, including those comparing financial products and services, utilities and others.

As part of a decade-long battle, campaigners are now calling for consumers who were misled over costs as a result of these practices to be compensated.

The CMA has asked members of the public with experiences of hotel comparison sites to share their opinions here.