Hotel comparison website Trivago is being sued for making misleading claims on its website and television advertising.

According to the ABC’s business reporter David Chau, key points are as follows:

• The Australian Competition & Consumer Commission  accuses Triage of misleading consumers by claiming it offers the “best price”
• Trivago allegedly prioritises hotels which pay it the highest advertising fees

In his report, Mr Chau says the ACCC alleged Triage deceived consumers into believing it was an “impartial and objective” aggregator that helps them find the cheapest hotel prices.

In a Federal Court case the ACCC argued Trivago’s search results prioritise advertisers who were willing to pay “the highest cost per click”.

“When you look at a lot of Trivago’s television advertising … and I’ve seen a lot of it, it’s often suggesting get on Trivago and find the best price,” ACCC chairman Rod Sims told the ABC.

He said Trivago and other comparison platforms “give the impression they’re there to help consumers when in fact they’re there to help suppliers who pay them the most money”.

Mr Sims said the ACCC began investigating Trivago after it received complaints from hotel operators who realised “they were cheaper [but] weren’t getting prioritised”.

“We’re alleging Trivago’s website is deliberately designed to mislead consumers.

“We looked at Trivago algorithm and formed the view that it was misleading in terms of the way it presented options to consumers.”

The regulator’s investigation found that consumers who visited Trivago’s website “overwhelmingly” clicked on the most prominently displayed offers for each hotel.

The ACCC is also accusing Trivago of deceiving consumers with “strike-through price comparisons” which offer misleading “deals”.

For example, it might list the hotel room’s full price as $420 — with a “strike through” to show the price has been slashed — and the final price is listed as $299.

“They are misleading because they often compare a luxury room with a basic room,” Mr Sims said.

“By not making genuine room price comparisons, consumers would likely have paid more than they otherwise would have for the same hotel.

“Further, hotels may have lost potential business as a result of this alleged conduct.”

The penalties for engaging in misleading and deceptive conduct, under the Australian Consumer Law, can be up to $1.1 million per breach.

Trivago has been contacted for comment.

The ACCC confirmed it is also investigating other comparison websites similar to Trivago.

“We believe this behaviour is widespread, but we’re currently investigating just how widespread.”

Mr Sims urged investors to consider, if the website is free to use, how it is earning money.

“If they’re making their money by commissions from who they prioritise, you have to wonder how much the choice that’s presented to consumers is influenced by how much the website is being paid — as distinct from what is the best offer for consumers.” the report concludes.

I have had a recent discussions with Booking.com about the 4 star Blakemore Hotel in London which is being extensively renovated although there is no mention of the fact on its website. I insisted the hotel information be changed to state the property was being upgraded and that a good deal of inconvenience was involved – particularly for older people. Nothing was done.

We discovered there is a new temporary entrance, no lift to upper floors, no ground floor lounge area or room service. That was in April this year. We were told the work would be finished by June.

When we booked the hotel again this month my wife discovered the work had not ended and the primitive, noisy conditions continued. Again, the Booking.com site makes no mention of the renovations which to say the least is extremely dishonest advertising.  Here is some of the information supplied: “One of our top picks in London. With free WiFi and 4-star bedrooms, the stylish Blakemore Hotel also features a leisure centre, a creative cocktail bar and restaurant open every day. Situated in elegant Bayswater, the hotel is a 5-minute walk from Hyde Park.”

Travellers should also note that the “special deal” Booking.com will offer for a property is increasingly a non refundable no changes allowed proposition.

During my last stay in a Paris hotel last year I was asked by reception to please book in future direct to the hotel via email. “It is ridiculous that we should have to pay up to 17 per cent to operators like Booking.com,”  the receptionist  told me. I would have to agree.

Written by Ian McIntosh