The government watchdog has launched enforcement action against hotel booking sites amid “widespread concerns”.
The concerns of the Competition and Markets Authority (CMA) include search results being ranked in accordance with factors unrelated to customers’ requirements, such as the commission paid to the website.
The watchdog also highlighted pressure-selling techniques including claims about how many people are looking at a room, how many rooms are left or how long a price is available.
It has also questioned if discount claims stand up to comparison and whether the price shown in search results is the complete cost of the booking.
The CMA has told booking sites to take action to address its concerns where they are believed to breach consumer protection law and threatened those who fail to act with court action.
Andrea Coscelli, chief executive of the CMA, said: “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.”
Angela Vickers, CEO of Apex Hotels, has welcomed the investigation.
She said: “We are especially interested to hear the watchdog is looking into the prices which first show when consumers search and if these reflect the final cost.
“More and more people are choosing to make bookings online and it’s important that consumers are protected from misleading information. Hopefully this investigation will weed out any sites which are not playing fair or pulling the wool over customers’ eyes.
“In the meantime I would encourage anyone with concerns to book direct with hotel reservations or the hotel website as we always put the customer first and our costs are transparent. Very often we can personalise the customer stay with additional perks.”
UK Hospitality has said the action should improve consumer confidence, which could only be good news for operators.
Chief executive Kate Nicholls explained: “We have been working tirelessly to highlight these practices, so are pleased to see the CMA take action.
“The CMA clearly intends to ensure that online booking sites are transparent and accurate, and that customers have complete peace of mind when booking. Extra reassurance for customers is welcome and that confidence should provide a boost for businesses.
“The fees that online travel agents charge hoteliers and B&Bs inevitably result in higher costs to the consumer – a premium of which many holidaymakers are not even aware. Consumers and accommodation providers would be better served by a wider review of the business to platform relationship, which is now overdue.
“The practices addressed here expose yet another example of digital businesses stealing an unfair lead on honest, regulated operators whose first concern is to deliver good service to their customers.”
The CMA has also referred a number of concerns around price guarantees and promises to the Advertising Standards Authority, asking it to consider whether statements like “best price guarantee” or “lowest price” mislead customers.
An Expedia spokesperson said: “We are aware of the announcement from the CMA today. Expedia Group continuously aims to deliver the best travel options at affordable prices in transparent, clear and easy to understand ways, so that our customers have all the information they need to make informed travel choices. Expedia will continue to engage with the CMA on these consumer matters, as it continues its inquiries in the travel sector.”