Hotel price comparison website Trivago has been found guilty of breaching Australian Consumer Law over misrepresentations it made online and in television advertisements.
The Federal Court ruled that from at least December 2016, Trivago misled consumers by promoting its best advertisers - with the highest cost-per-click fees - instead of sorting accommodation based purely on the cheapest room rates, as it claimed to do.
“Trivago’s hotel room rate rankings were based primarily on which online hotel booking sites were willing to pay Trivago the most,” said Rod Sims, chair of the Australian Competition and Consumer Commission (ACCC), which brought the matter before court nearly 18 months ago.
“By prominently displaying a hotel offer in ‘top position’ on its website, Trivago represented that the offer was either the cheapest available offer or had some other extra feature that made it the best offer when this was often not the case.”
In addition to this, the court ruled that the Netherlands-based business used strike-through prices and coloured text to give consumers a false impression that they were getting the cheapest option when Trivago “often compared an offer for a standard room with an offer for a luxury room at the same hotel”.
“We brought this case because we consider that Trivago’s conduct was particularly egregious. Many consumers may have been tricked by these price displays into thinking they were getting great discounts,” Mr Sims said
“In fact, Trivago wasn’t comparing apples with apples when it came to room type for these room rate comparisons.”
According to the ACCC, a hearing on penalties will be held at a later date.
“This decision sends a strong message to comparison websites and search engines that if ranking or ordering of results is based or influenced by advertising, they should be upfront and clear with consumers about this so that consumers are not misled,” Sims said.
Have you ever used Trivago? If so, how did you find the presentation of their information?
Subscription successful! Thank you for subscribing.