Hotel booking sites must change the way they rank and sell rooms, the UK’s competition watchdog has said.
The Competition and Markets Authority (CMA) has written to some online hotel booking sites to warn them that they risk court action unless they review their practices to comply with consumer protection law. It expressed concern about discount claims, hidden charges and pressure selling such as creating a false impression of room availability to rush customers into booking decisions.
Hotel deals that don’t add up
The action comes two years after Which? Travel first investigated the deals available on sites such as Booking.com and Expedia and found many weren’t deals at all.
On Expedia we found eight of the first ten search results for hotels in Barcelona had a crossed-out price displayed next to them. Yet, the explanation from Expedia about how the discount had been calculated wouldn’t match most people’s expectations of a discount. It said: ‘This comparison price is the highest price at which this hotel is available on Expedia for at least one of the next 14 days.’ The so-called ‘sale’, then, simply translates as: ‘Some nights at this hotel are cheaper than others.’ The particular night’s stay you’re booking may not have been reduced at all.
Booking.com has a similarly novel take on the concept of a discount. Hover over its crossed-out prices, and you’ll see: ‘The discount is based on the third highest current price of the property for rooms with the same booking conditions in a 30-day window around your check-in date (15 days before and 15 days after check-in date; if less than 15 days are between today and the check-in date, we will use the corresponding number of days after the check-in date to result in a 30-day total).’ Just 7% of you said you were satisfied that this was a fair way for Booking.com to calculate the discount.
We believed Expedia and Booking.com’s claims of discounts could be misleading, so passed our findings on to the CMA, which is now taking action.
Customers pressured into paying too much
The CMA’s investigation also includes examining the pressure-selling tactics used by online hotel booking sites, such as claims about how many people are currently looking at a hotel.
Which? Travel research found that 46% of customers were more likely to book if told several other people were looking at the same property. While 44% of people said they were more likely to reach for their credit card if told there was only ‘one room left at this price’.
Tim Gale, a tourism lecturer at Bournemouth University, told Which? Travel that these prompts ‘create a sense of fear, panic and urgency in the buyer’. He added: ‘A lot of the language is designed to prey on people’s fears of missing out on a bargain.’
No need to hurry
As part of its drive, the CMA has referred a number of hotel booking sites to the Advertising Standards Agency (ASA) amid concerns over the authenticity of price promises. It is asking the UK’s advertising regulator to consider whether statements such as ‘lowest price guaranteed’ are misleading and what conditions must be met for companies to make such claims.
The move follows a Which? Travel investigation, which revealed that misleading time-limited promotions, or ‘hurry deals’, could be duping travellers into paying hundreds of pounds over the odds for holidays. The ads, which appear in newspapers and online, promise consumers bargain prices if they book their package holiday or cruise before the cut-off date. However, when we tracked deals over a three-week period in summer 2017, we found that in 16 out of 30 cases, the price was the same – or even cheaper – after the sale had ended.
Questionable deals included a Lastminute.com stay at a Paris hotel with flights. The day after the promotion ended, the price dropped from £139 to £126 – and this lower rate was still available a week later. Other deals saw prices yo-yo. Two-nights at another Paris hotel was £404 in Expedia’s ‘flash sale’. After the promotion ended, the break went up to £628 – only to drop again a fortnight later when a new 40% off promotion ran. This time the same stay was available for £382 – £22 cheaper than the original ‘sale’ price.
At the time, all of our findings were passed onto the CMA and the ASA to help with their investigation.
How to find the best hotel deal
Hotel booking websites are still the best place to start your search for the best priced hotel room, but be sceptical about any ‘deals’. It’s also important to shop around, even when using price comparison tools as no single site has the best deal every time. Read our how to find a cheap hotel room for more tips on how to secure the best price.