Rise of online booking sites are making your hotels cost more

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HUGE online booking sites are said to be hiking up the prices of hotels for everyone because of the commission they charge.

And, it is claimed, there are two reasons why you won’t find cheaper rates elsewhere.

Booking comparison websites have been accused of "brandjacking" independent hotels
Booking comparison websites have been accused of “brandjacking” independent hotels
Alamy

At the moment, two companies – Booking Holidays, which owns booking.com, and Expedia group, which owns hotels.com and Trivago – control 80 per cent of the hotel comparison market.

David Weston, chairman of Bed and Breakfast Association told The Times, that when you book through an online platform such as these, approximately £1 in every £5 spent is going to the booking site rather than the hotel itself.

This additional cost, which can be up to 20 per cent of what you would pay otherwise, is passed off to the customer, leading to higher rates for everyone.

He said: “Online travel agents don’t own accommodation, employ staff, welcome guests or take any risk if rooms are unsold, yet their power has grown to the point where they dominate our industry and have driven up the prices consumers pay by billions.”

The websites are able to bump a hotel further down when their hotel name is searched for
The websites are able to bump a hotel further down when their hotel name is searched for
Getty – Contributor

Mr Weston claims that there are two main reasons why you won’t find a cheaper rate easily, if at all.

The first is a practice known as “brandjacking”, where the comparison sites pay Google to appear high in the rankings.

Mr Weston revealed: “When consumers think they are clicking on a hotel or B&B name at the top of search results, it is typically a travel agent’s link in the hotel’s name.”

It means that these comparison and booking sites completely dominate the internet, making it very hard for smaller and independent hotels and B&Bs to make any direct sales.

Desperate B&B and hotel owners therefore have no choice but to sign up to online travel agents and list their properties there.

These sites also often have a “rate parity” clause in the contracts with the hotels and B&Bs, meaning that any properties signed up to these sites are not allowed to offer a cheaper rate for customers who book directly.

Both of these are completely legal but can mean that the cost of hotel rooms are much higher than otherwise.

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The Bed and Breakfast Association is now calling for the UK competition regulator Competition and Markets Authority (CMA) to ban both “brandjacking” and “rate parity” clauses.

Countries such as France, Germany and Italy had already banned them, which allows a fairer market for independent hotels.

Old Brewery guest house owner Frank McCready, 73, told The Times:  “All that actually happens is they take away the business you used to get directly and you end up paying them 20 per cent commission.”

He was told by Google that the only way to get above the hotel booking website in a search for his hotel would be to spend over £900 per month on advertising.

His petition to end the high-jacking technique has reached over 2,000 signatures so far.

The costs will make your holiday more expensive
The costs will make your holiday more expensive
Getty – Contributor

An Expedia Group spokesperson told Sun Online Travel: “We have long supported the B&B community. Last year, on invitation by the Chairman of the B&B association, we supported National B&B Day, speaking directly to B&B and guesthouse owners to answer their questions and advise on how an online travel agent can work for them if they choose.

“We were delighted to hear that the association had received only good feedback on this day. We have also recently invested significant time and energy into working closely with the CMA to create a helpful industry standard for all UK booking sites offering accommodation search and booking services.

“Expedia Group is only a small percentage of a $1.7 trillion travel market. We are a platform which helps level the playing field for any size of property giving them a bigger voice and greater reach online for all our thousands of lodging partners worldwide.

“We are proud that by continuing to offer customers transparent and efficient ways to book travel, we can help support and grow the UK tourism industry.

When it comes to flights, Momondo came out on top as the best flight comparison booking website for the cheapest prices.

Despite this, the most popular was Skyscanner despite it not always offering the best price.

Sun Online Travel has contacted booking.com for comment.

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