Hotel booking sites will be forced to make major changes after Britain’s competition watchdog found they routinely engaged in pressure selling, misled consumers over prices and gave more prominence to hotels that paid the most commission.
The Competition and Markets Authority is clamping down on websites including Expedia, Booking.com and Hotels.com over practices that give a false impression of a hotel’s popularity, with claims such as “one room left at this price” and “booked four times in the last 24 hours”.
The CMA said the pressure tactics used by six firms – which also include Trivago, ebookers and Agoda – could prevent customers finding the best deals in practices that could amount to breaches of consumer law.
Andrew Tyrie, the chairman of the regulator, said: “The CMA has taken enforcement action to bring to an end misleading sales tactics, hidden charges and other practices in the online hotel booking market. These have been wholly unacceptable.
“Six websites have already given firm undertakings not to engage in these practices. They are some of the largest hotel booking sites. The CMA will now do whatever it can to ensure that the rest of the sector meets the same standards.”
The websites have a deadline of 1 September to make the changes or face further action. Not all firms engaged in all of the dubious practices but all have agreed to abide by all the principles set out by the CMA.
Rory Boland, the travel editor at the consumer group Which?, said: “We have repeatedly exposed sites like these for using dodgy tactics like pressure selling, sneaky charges, dodgy deals and discount claims, so it’s absolutely right that the CMA is taking strong action.
“These changes must now be swiftly implemented to stop these misleading practices, so customers can trust the deals they’re presented with are really deals and are told the total cost of their room upfront when booking a hotel online.”
In future, booking sites will be required to make it clear how hotels are ranked – for example when ranking is influenced by how much commission the website receives – and include the total amount due in the headline cost, rather than hiding extra costs until the end of the booking process.
Pressure-selling tactics that give a false impression of the availability of a room will also be banned. For example, sites may flash a message to say other customers are looking at the same hotel, even though they may be looking at a different date.
The CMA is also clamping down on misleading discount claims, for example, displaying a weekday rate as if it is discounted, when in reality it is being compared with a higher weekend room rate.
Research carried out by Which? before the official CMA investigation was launched discovered examples where booking sites appeared to be misleading the public, including:
A room at a New York hotel, the Row NYC, was advertised at £166. However, on clicking through to book, once taxes and other fees were added, the price came to £211 – 27% more than the rate advertised in the headline.
Expedia offered a rate of £37.29 for a night at the Alsisar Hotel in Jaipur, India. The price was supposedly reduced from £109, sounding like a great deal, until the hotel’s own website showed the price for the same night was actually £34.35.
In a promotional email, Hotels.com advertised a deal for a one-night stay at the luxury London hotel 45 Park Lane for £388. However, the lowest available price for any date that could be found on the booking site was £488.
There was no way of verifying pressure prompts that claim a specific number of people are looking at the same hotel or whether they are looking at the same dates.