- Booking ads face FTC scrutiny.
- Guest Reservations receives complaints.
- Hotel chains encourage direct bookings.
The FTC is looking at Booking’s relationship with Guest Reservations, a third-party website that advertises rooms at specific hotels, Reuters reported, citing two people familiar with the matter. The agency is examining whether the websites make customers think they are booking directly with a hotel and whether they break rules on fees.
Booking supplies hotel room listings to Guest Reservations through Priceline Partner Solutions, according to a San Francisco lawsuit. In August, it disclosed that the FTC was considering legal action against Priceline and an unnamed affiliate over fees, billing and customer support.
“Third-party booking sites that confuse consumers by misrepresenting their affiliations with hotels or advertising misleading rates and inventory have been a persistent problem for years,” an American Hotel & Lodging Association spokesperson told Reuters.
Booking site complaints
Guest Reservations received more than 1,000 complaints through the Better Business Bureau. Many customers said they thought they were booking directly with a hotel. Others reported unexpected fees and difficulty reaching customer service.
Hotel chains encourage customers to book directly through their own websites to avoid commissions and transaction fees. However, third-party booking sites such as Booking and Expedia remain important sources of business for major chains, including Marriott International and Hilton Worldwide Holdings.
Laura Lee Blake, AAHOA president and CEO, said hotel owners and staff often handle complaints when third-party bookings go wrong.
“If someone who works in the hotel industry can make that mistake, imagine how easily the average traveler can be confused,” blake said.
FTC looks at online ads
FTC Chairman Andrew Ferguson said in a Reuters interview in September that the agency was investigating misleading online ads, including those that lead people to websites that appear to be run by hotels.
The FTC cited third-party hotel sites that use Google ads to appear above hotels’ own websites in search results. Online platforms can still earn money from these ads, even when they mislead customers.
“For tens of millions of Americans, they don’t notice until they’ve checked out and they’ve paid exorbitant fees,” Ferguson said.
The FTC is also considering whether online platforms should do more to stop misleading ads.
In March, the U.K.’s Competition and Markets Authority launched an investigation into CoStar and Hilton, Marriott and IHG over hotel data sharing.
