Following enforcement action by the CMA in 2018, Expedia, Booking.com, Agoda, Hotels.com, ebookers and trivago have all voluntarily agreed to measures that it’s hoped will improve transparency for online customers.
These companies will be required to clarify how hotels are ranked once a customer has entered their search requirements, cease any pressure sales tactics that might give a false impression of a room’s availability or popularity, be more transparent about discounts and display all compulsory charges, including taxes and booking or resort fees, in the headline price.
Not all of the firms mentioned engaged in the practices mentioned, however all have agreed to abide by principles set out by the CMA and make changes by 1 September at the very latest.
‘Firm undertakings’ given
CMA chairman Andrew Tyrie commented: “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.”
As reported by The Morning Advertiser in November 2017, the aforementioned companies have all been the subject of CMA investigation stemming from concerns over issues such as pressure selling, misleading discount claims and hidden charges.
Customers ‘unwittingly misinformed’
UKHospitality’s chief executive Kate Nicholls welcomed the steps to tackle misinformation.
“Action to provide transparency, clarity and fairness around online booking platforms will provide a fairer playing field, which can only be a good thing,” she commented. “Customers booking online have for too long been unwittingly misinformed and they deserve better.
“The CMA’s recommendations will simultaneously add a level of protection for accommodation businesses which have too often lost out via unfair practices. UKHospitality has worked hard with partners and our members to secure today’s announcement.
“We hope that the voluntary commitment from online booking companies is honoured, otherwise the CMA’s review has shown that this is an issue that may warrant legislation. It is a welcome step to increase transparency in the realm of online platforms at a UK level.
“We now need action to address unfair parity clauses to ensure there is fairness and transparency for both customers and businesses.”
Moreover, Sophie Herbert, marketing director at Beds & Bars – a finalist in the best accommodation operator category at the 2019 Publican Awards – explained that, despite recent news from the CMA, there was still a lot of work to be done to level the digital playing field.
"The outcome of the investigation is a small step in the right direction for consumers, however, I see no real direct positive effect on us as properties,” she told The Morning Advertiser. There is still a massive way to go in regards to equalling the playing field for us as partners.
“I'm also interested to see if other online travel agents (OTAs) take this example on board and look to follow suit as of 1 September."
Moreover, Typhaine Leroy, collection revenue and reservations manager at Cirrus Inns - another finalist in the best accommodation operator category at the 2019 Publican Awards - commented: "The CMA’s decision is a positive step for the industry and can only be beneficial for consumers and hotel organisations alike.
"Forty percent of our bedrooms are booked via OTAs. Although we have been more and more innovative in our marketing campaigns, small independent collections like Cirrus Inns do not have the same resources as the big OTAs.
"We believe that CMA’s enforcement will help reduce hotel’s dependency on OTAs and increase guests’ awareness that often the most beneficial way of booking, for them, is to book directly.
"Cirrus Inns are taking this opportunity to communicate these advantages and working to re-enforce guest loyalty.
"I am hopeful that OTAs will take this opportunity to launch new products and services that will only add value for guests. As technology continues to improve and shape customer expectations, we are continually working to provide the best possible experience for our guests.
"Hotels now have access to a whole suite of new technologies from advancement in guest interaction through social media channels, chatbots, booking engines and platforms that use artificial intelligence, such as Triptease, we now have great opportunities to increase direct bookings."