Friday, June 5, 2020

CMA to probe claims made by hotel booking websites

The Competition and Markets Authority is investigating booking sites to find out whether their customers really are able to choose the best hotel deal for them.

The CMA is concerned about the clarity, accuracy and presentation of information on sites, which could mislead people, stop them finding the best deal and potentially break consumer law.

Its investigation will examine several practices, including:

  • Search results: how hotels are ranked after a customer has entered their search requirements, for example to what extent search results are influenced by other factors that may be less relevant to the customer’s requirements, such as the amount of commission a hotel pays the site.
  • Pressure selling: whether claims about how many people are looking at the same room, how many rooms may be left, or how long a price is available, create a false impression of room availability or rush customers into making a booking decision.
  • Discount claims: whether the discount claims made on sites offer a fair comparison for customers – 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, for example comparing a higher weekend room rate with the weekday rate for which the customer has searched.
  • Hidden charges: the extent to which sites include all costs in the price they first show customers or whether people are later faced with unexpected fees, such as taxes or booking fees.

The CMA has today written to companies across the whole sector requiring information to understand more about their practices. The CMA also wants to understand the impact that these practices have on sites’ customers, so is calling on people that use them, and hotels that advertise with them, to share experiences which could be relevant to the investigation.

If the CMA finds that sites’ practices or claims are false or misleading and are breaking consumer law, the CMA could take enforcement action.

Andrea Coscelli, Chief Executive of the CMA, said: “Around 70% of people who shopped around for hotels last year used these sites and they should all be confident they have chosen the best accommodation for their needs and are getting a good deal. In today’s increasingly busy world, sites like this offer real potential to help holiday-makers save time and money searching for their ideal get-away.

“To do this, sites need to give their customers information that is clear, accurate and presented in a way that enables people to choose the best deal for them. But we are concerned that this is not happening and that the information on sites may in fact be making it difficult for people to make the right choice.

“That’s why we have started our investigation into this sector – to get to the bottom of these issues, see whether sites are breaking consumer law and make sure they help, not hinder, people searching for their next hotel room.”

The announcement follows the CMA’s year-long market study of online comparison tools, which emphasised the importance of complying with consumer law by setting out clear ground rules.

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