Hotel comparison website Trivago claimed to give you the "best price" for a hotel room when it was in fact simply promoting advertisers.
The ACCC took Trivago to court in August 2018 for breaching Australian consumer law by inaccurately highlighting one particular aggregated hotel booking price and suggesting it was the best offer.
Federal Court Judge, Mark Moshinsky, agreed saying in his ruling that Trivago “did lead consumers to believe that the Trivago website provided an impartial, objective and transparent price comparison” but its algorithm had a built-in bias toward highlighting offers with the highest cost-per-click fee.
“Trivago’s hotel room rate rankings were based primarily on which online hotel booking sites were willing to pay Trivago the most,” ACCC Chair, Rod Sims, said.
“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 66.8 per cent of all listings, rooms with higher prices were selected as the top offer over lower-priced ones.
“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,” Sim said.
Trivago rarely promoted the best price. Source: ACCC
Furthermore, the ACCC took Trivago to task for its use of strikethrough text that made it appear as though a significant discount was being offered which Judge Moshinsky said “was misleading or deceptive or likely to mislead or deceive” – an accusation which Trivago admitted to.
While the strikethrough prices looked like they were offering discounts on comparable rooms, the strikethrough numbers instead came from the most expensive room at the same hotel.
“We brought this case because we consider that Trivago’s conduct was particularly egregious,” ACCC chair, Rod Sims, said.
“Many consumers may have been tricked by these price displays into thinking they were getting great discounts.
“In fact, Trivago wasn’t comparing apples with apples when it came to room type for these room rate comparisons.”
The ACCC is seeking orders for penalties, declarations, injunctions, and costs.
The matter will go to case management at a later date.