Online travel agencies to receive wrist slap from CMA: One of the problems with using online travel agencies to make bookings has always been the authenticity of the details presented to consumers.
Popular hotel booking sites have been now been found wanting when it comes to information transparency, says a recent BBC report. Online Travel Agency (OTA) giants such as Expedia, Booking.com, Agoda, Hotels.com, ebookers, and Trivago have been challenged and taken to task regarding sales strategies and deceiving markdowns.
The Competition and Markets Authority (CMA) was concerned the hotel booking engines were inflating popularity ratings on rooms to make them appear to be more in demand than figures disclose.
The OTA’s will now be expected to reveal whether commissions they receive influence the outcomes of their campaigns. They will also be required to have greater transparency when it comes to concealed charges and the amounts of commission they are paid.
The CMA started its examination of the OTA industry in June 2018 however didn’t name the correlation locales it was exploring.
“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,” said CMA Chairman Andrew Tyrie, told the BBC
“These have been wholly unacceptable,” he added.
Travel industry reforms
However, while the investigation by the CMA throws light on the online travel agency industry, the journey to reform the OTA’s will be a challenging one. While the CMA has pinpointed the six leading agencies, many more require investigation before reforms can be fully implemented.
Consumer groups have welcomed the move because it will lead to better customer servicing. However, recommendations that the changes should be put in place quickly, may prove to be difficult.
Customer service transparency
Methods to coerce customers into faster sales have included:
1) Giving a false impression of booking demands and property popularity by showing customers who else is currently looking at the featured deal, as different dates are being explored.
2) No transparency when it comes to the ranking quality of the hotel and which properties have paid more commission to be featured higher up the list.
3) Promoting offers that are not available at the time of advertising.
4) Failure to disclose additional charges such as booking costs, taxes, and hidden fees.