Consider this stat for a moment: 23% of 2017 travelers reported feeling misled by online travel agencies, or OTAs for short. That resulted in 28.5 million hotel stays that came from misleading OTA experiences that year, according to research from the American Hotel & Lodging Association. Put more simply, nearly a quarter of online travel customers have fallen victim to OTA shenanigans. We think that’s a huge problem. Here’s why: you might be a part of that 23% and you didn’t even know it.
Widespread OTA Problems
The hotel industry is a big business… real big. Hotel bookings account for 15% of all U.S. e-commerce, according to AHLA. Each minute, 500 hotel bookings occur. More than 250 online bookings transpired since you started reading this article.
This sheer volume of hotel bookings has allowed scammers to enter the market. Of the 23% misled travelers, 46% reported that they incurred extra fees on their credit cards, and 34% said the booking site actually lost their reservation, thus requiring a new booking without a refund for the lost room. Additionally, 44% said that they made a specific room request that was never relayed to the hotel.
Travelers are starting to pick up on issues like this. They want more transparency and honesty with online bookings, and many even think that governments should step in to add greater protection for consumers. AHLA reports that 72% of Americans want the government to make it a higher priority to enforce consumer protection laws against third-party hotel resellers. In February of 2019, the UK stepped in and put a ban on deceptive search practices used by many OTA sites.
Misleading OTA Tactics to Watch Out For
1. Pressure Selling Messages
Only 3 rooms left.
5 people are looking at this hotel right now.
You missed it! This hotel is sold out for your dates.
Any of these sound familiar? If you’ve booked a hotel online in recent years, you’ve almost certainly seen pressure-selling phrases like this. They litter the search results of many popular OTA sites, tempting you to click that hotel and book that room now before you lose your chance.
But hold up… Things aren’t as dire as these booking sites are leading you to believe. The hotels themselves often have plenty of rooms still available if you call or book on their site directly. Don’t believe these claims aimed at triggering your FOMO. In fact, some travel booking sites have actually been caught using randomly generated numbers for scare-tactic phrases like this. Yep, they can be completely made up.
To help annoyed OTA users out, someone has built a browser extension called No Stress Booking that blocks urgency messages like these. We recommend downloading it ASAP if you plan to continue using those sites—or just use Roomkey, where we don’t do any of that nonsense. Ever.
2. Discount Claims
Beware of another misleading OTA tactic: things that look like discounts that aren’t actually discounts. OTAs are great at comparing apples to oranges to get you to believe that the apple is on sale, when in fact the apple is just cheaper than the orange in the first place. Here’s an example…
A search on Travelocity.com returns a listing for a Super 8 hotel property. They show a crossed-out price, and they highlight in green that the lower rate is “15% off,” implying that they are offering a discount on this hotel.
But upon further investigation, the initial $105 rate is simply the hotel’s standard rate for that property while the $89 price is their prepaid rate. (Prepaid rates are offered by many hotels to give you a lower rate in exchange for the ability to cancel or modify your reservation.) While the $89 prepaid rate is indeed 15% lower than the $105 standard rate, this compares apples to oranges because booking a standard rate is completely different than booking a prepaid rate due to the differing cancellation policies.
To learn more about misleading discount claims, read our post, What You Need to Know About Hotel Discount Shopping.
3. Skewed Search Rankings
Have you ever wondered how OTA sites sort their search results? Maybe you assumed it was by price or by rating or by proximity to city center (which is what we do.) Unfortunately, OTAs aren’t nearly as wholesome as that. Due to algorithm ranking systems, you’re actually being shown their top picks first by default. These “top picks” are based on which hotels have the best ratings but also how much that hotel pays the OTA in commission fees. Some OTAs even openly admit to this on their sites:
OTAs are banking on you not scrolling too far down the page before selecting a hotel, and they make more money that way by listing their higher commissioned hotels first.
4. Tricky Cancellation Policies
OTAs are notorious for having rigid cancellation policies and charging fees for rescheduling or canceling hotel reservations. Their policies are buried in the fine print that you don’t even see until you’re already in the process of checking out. In addition, some OTA cancellation policies are different than the cancellation policies of the hotel where you’re staying, making it even more confusing for customers. Worse, if you do try to cancel your hotel, you’ll likely find yourself stuck in customer service limbo where the OTA tells you to call the hotel, but the hotel can’t modify your reservation because you booked it through a third-party OTA site.
But If I Get Misled by One OTA, There Are Still Plenty More for Me to Use, Right? Well…
On average, travelers visit 38 travel sites before booking their travel. That’s way too much time and energy wasted in the search stage. If this has ever been you, there’s a strong chance that most of the 38 websites you visited looked pretty similar, both in appearance and in prices. That’s because the consolidation of OTA sites has generated a lot of confusion for consumers.
Booking.com, Priceline, Agoda, & Kayak, and Expedia, Hotels.com, Hotwire, Trivago, Travelocity, & Orbitz are mere variants of one another with one commonality—one of two giant parent companies own them all. Booking Holdings Inc. and Expedia Group have grown rapidly in recent years as a result of numerous acquisitions. By 2018, they together made up over 70% of the OTA market. Even worse, AHLA’s surveys report that 75% of people aren’t even aware they are browsing websites owned by only two companies.
What this means for you and for other online travel searchers is that you don’t have nearly as much choice as you thought you did. This also means that you may still be getting misled even if you ditch one OTA and move on to another.
How to Book Smarter
The easiest way to book smarter is to book directly with a hotel instead of with a third-party OTA site. This makes you a customer of the hotel rather than the OTA, and the hotel will be much more able and willing to help you out if you need to modify your reservation or if you have special requests once you arrive. Booking direct will always result in a better booking experience and better customer service.
Booking direct can also result in lower rates, if you know where to look. Members of hotel loyalty programs have access to non-public rates that are often cheaper than the rates that OTAs can sell on their sites. This is the real way to find those hotel discounts you were after. Sign up for as many programs you want—they’re free—to save on hotel rates wherever you stay.
For the best of both worlds (the security of booking direct + the ability to search multiple hotel chains at once), search smarter by using Roomkey.com to start your hotel search. Unlike OTAs, we won’t mislead you or pressure you into booking something when you’re not ready. We’re also all about transparency and will show you all available rates with clear definitions of what each one means. Unlike OTAs, Roomkey includes those low loyalty rates in your search results so you can browse the best deals on the market.
Because Roomkey is not an OTA, we don’t take your hotel booking ourselves. Instead, we redirect you to the hotel’s site to complete your booking at the source. That’s the best way to secure your room, your rate, and your loyalty points too. And that’s the best way to avoid being misled.
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