Are Expedia and booking.com Gouging Customers

[drron]

Well according to one Danish startup they are.

Hotel Site Accuses Booking, Expedia of EU Antitrust Breaches

Online travel booking site Nustay A/S has filed a complaint to the European Union’s antitrust regulator, claiming Expedia Group Inc. and Booking Holdings Inc. are trying to “kill off” the startup for offering lower prices and punishing hotels that appear on its site.

www.bloomberg.com

 

[dajop]

Would not be surprised, between them, Booking Holdings (booking.com, priceline, agoda, kayak) and the Expedia Group (expedia, hotels.com, hotwire, orbitz, travelocity, trivago) have incredible market power. Many people don't realise how many of the plethora of booking websites are actually owned by these two companies.

 

[Franky]

There was a 15 minute Dick Smith rant on this subject circulating on the net about a month ago. His argument is to look on the above mentioned sites, then book directly with the hotel you prefer, though he does add that the local hotels are somewhat reluctant doing this as your call may well be a fishing expedition from one of the agencies above checking to see if the hotel is bypassing them. Commissions billed to the hotels were said to be as high as 30%.

 

[Frequent boarder]

There was a 15 minute Dick Smith rant on this subject circulating on the net about a month ago. His argument is to look on the above mentioned sites, then book directly with the hotel you prefer, though he does add that the local hotels are somewhat reluctant doing this as your call may well be a fishing expedition from one of the agencies above checking to see if the hotel is bypassing them. Commissions billed to the hotels were said to be as high as 30%.

maybe book with real living travel agents in Australia !!!!

Buy Australian & keep jobs in Australia.

Often book with local travel agent who provides great service, good prices, often cheaper than on line accommodations plus they give me lots of tips on upgrading cheaply & how to improve chances of getting empty seats around us on flights, which has worked many times on long haul flights.

 

[p--and--t]

The owner of a motel in rural NSW told me she was slowly being driven out of business by the big OBA's but couldn't stop using them.

She advised if customers rang and booked direct they would pay at least 10% less than any advertised price and she would make a bigger profit on the room.

Yet again a receptionist in a motel in SA told me due to contracts that I would never get a good price ringing the motel and to go via a specific OBA to get a better price.

 

[Franky]

The owner of a motel in rural NSW told me she was slowly being driven out of business by the big OBA's but couldn't stop using them.

She advised if customers rang and booked direct they would pay at least 10% less than any advertised price and she would make a bigger profit on the room.

Yet again a receptionist in a motel in SA told me due to contracts that I would never get a good price ringing the motel and to go via a specific OBA to get a better price.

The last two posts reflect what Dick Smith was driving at, his video would be still available on YouTube I would guess, and though a bit repetitive, is worth a look.

 

[p--and--t]

Have you ever noticed that the price of a room at a hotel goes up when you check a couple of different sites over the course of a few hours? My belief is that companion sites are tracking you and bumping the price on the belief you are intent on booking some time so they can gouge you for a bit more.

My routine for using OBA sites:

• Use "incognito" mode wherever possible
• Always delete your cookies before going back in a second or third time
• Search anonymously (not logged in)
• If requested by a popup, don't disclose your location (not sure if this actually has an effect)

My strong suspicion is the less they know about you, in most cases, the better the price.

BTW: The same applies searching for airfares on sites such as Kayak etc.

 

[p--and--t]

ACCC takes action against Trivago over hotel price advertisements

The ACCC has instituted proceedings in the Federal Court against trivago N.V. (Trivago) alleging it made misleading hotel pricing representations in its television advertising and website, in breach of the Australian Consumer Law.

www.accc.gov.au

 

[Franky]

Have you ever noticed that the price of a room at a hotel goes up when you check a couple of different sites over the course of a few hours? My belief is that companion sites are tracking you and bumping the price on the belief you are intent on booking some time so they can gouge you for a bit more.

My routine for using OBA sites:

• Use "incognito" mode wherever possible
• Always delete your cookies before going back in a second or third time
• Search anonymously (not logged in)
• If requested by a popup, don't disclose your location (not sure if this actually has an effect)

My strong suspicion is the less they know about you, in most cases, the better the price.

BTW: The same applies searching for airfares on sites such as Kayak etc.

And quite often when looking at a specific room, a pop-up appears saying hurry up, 5 people looked at this room in the last hour - or similar...

 

[trooper]

The owner of a motel in rural NSW told me she was slowly being driven out of business by the big OBA's but couldn't stop using them.

She advised if customers rang and booked direct they would pay at least 10% less than any advertised price and she would make a bigger profit on the room.

Yet again a receptionist in a motel in SA told me due to contracts that I would never get a good price ringing the motel and to go via a specific OBA to get a better price.

Why not? Is it because she doesn't want to lose online visibility they provide? Well.. Im sorry... but its a bit much to want the benefits of signing up with these OBA's while coughing about the costs...surely? Perhaps Aussie hotels/motels should try to band together and produce their OWN booking site???

 

[moa999]

And one of the big advantages of these systems is the big rewards (1 in 10 for hotels) - this is obviously part of the fee.

The big operators get around this by only providing loyalty points when you book direct and providing other benefits (eg. Free internet).
That would be the simplest thing to do for the little guys. - eg. $5 breakfast, $30 room service voucher etc.

 

[p--and--t]

I suspect the little guys (sub 20 rooms) are suffering from the huge advertising budgets of OBAs creating a false impression that patrons will always get the best price by booking online.

The small operators seem to be stuck between having empty rooms or filling them at unsustainable margins after paying huge commissions due to the migration of patrons to sites appearing at the top of google searches.

 

[Melburnian1]

...Commissions billed to the hotels were said to be as high as 30%.

I've asked hoteliers in Singapore and Philippines what the typical commission is. One said '18 to 24 per cent', another said '17 to 24 per cent.'

This is extremely high. I'd have thought five per cent commission (tops) would be fair, but then I'm not an OTA as they're called. Must make a mint.

 

[Melburnian1]

...Yet again a receptionist in a motel in SA told me due to contracts that I would never get a good price ringing the motel and to go via a specific OBA to get a better price.

I telephoned a motel in the Newcastle area, NSW after noting what the room tariff was on booking.com and wotif.com

I was told they wouldn't offer a price lower than the online travel agents' websites. After I booked through one of the latter, at check in I complained and said 'you obviously don't care about paying 25 per cent commission to these guys', but was swiftly informed that 'we have a contract with these online travel agents...' and then she trailed off.

I had also asked whether if I'd booked direct they'd have offered me an incentive to which the answer was a firm 'no.'

So exactly the same story in a different state, meaning what you say p-and-t has to have the ring of truth.

As someone who isn't in small business, I have difficulty understanding how the business will benefit from such a strategy.

 

[ozfflyer]

The owner of a motel in rural NSW told me she was slowly being driven out of business by the big OBA's but couldn't stop using them.

She advised if customers rang and booked direct they would pay at least 10% less than any advertised price and she would make a bigger profit on the room.

Yet again a receptionist in a motel in SA told me due to contracts that I would never get a good price ringing the motel and to go via a specific OBA to get a better price.

sounds like they've signed illegal contracts, bit like Izzy Folau. You can't stop competition. Cross border contracts complicates things a bit I think, but anything that reduces competition, must be illegal.

 

[odysseus]

I suspect the little guys (sub 20 rooms) are suffering from the huge advertising budgets of OBAs creating a false impression that patrons will always get the best price by booking online.

The small operators seem to be stuck between having empty rooms or filling them at unsustainable margins after paying huge commissions due to the migration of patrons to sites appearing at the top of google searches.

Spot on. It's a similar issue with how paypal became popular with buyers thanks to ebay forcing it on sellers and add some encouragement of it, then ratcheting up the fees for sellers because all buyers then wanted it.

Or more recently a similar thing with afterpay, promoting no extra cost to buyers, but passing on substantial costs to sellers. But driving consumer demand.

In all cases, if the sellers drop that service then that cuts out a significant share of the market and their business. Or they keep paying and potentially get driven to the wall with shrinking margins.

Hence, as a consumer I try to avoid these services, which just result in higher prices for all... but I'm in a minority.

 

[odysseus]

sounds like they've signed illegal contracts, bit like Izzy Folau. You can't stop competition. Cross border contracts complicates things a bit I think, but anything that reduces competition, must be illegal.

It's not illegal. They just guarantee to offer their lowest prices through these services, which isn't contractually illegal. It enables the services to guarantee that they offer the lowest price to attract consumers.

I have found some hotels encourage direct bookings as mentioned above, by adding inclusions if you book directly. That way they don't breach the contract, but also can give a benefit to those who go directly.

 

[ozfflyer]

It's not illegal. They just guarantee to offer their lowest prices through these services, which isn't contractually illegal. It enables the services to guarantee that they offer the lowest price to attract consumers.

I have found some hotels encourage direct bookings as mentioned above, by adding inclusions if you book directly. That way they don't breach the contract, but also can give a benefit to those who go directly.

I would have thought it was a restriction of trade, but don't think anyone has challenged these obviously dodgy contracts in court & different courts in different countries might come up with different results.

 

[drron]

I would have thought it was a restriction of trade, but don't think anyone has challenged these obviously dodgy contracts in court & different courts in different countries might come up with different results.

I think you are correct which is why it will be interesting to see the result in the EU.Though Booking had already promised the EU it would allow rival travel agents but not hotels to advertise lower prices.So you would think they may be in trouble.
They have had to make some concessions in the UK and Turkey after running foul of regulators.

 

[ozfflyer]

I think you are correct which is why it will be interesting to see the result in the EU.Though Booking had already promised the EU it would allow rival travel agents but not hotels to advertise lower prices.So you would think they may be in trouble.
They have had to make some concessions in the UK and Turkey after running foul of regulators.

price fixing ?

Then again any switched on hotel owner, could easily say to any direct callers, pay $1 more & we'll give you free "stuff"