AH&LA Study: 15 Million Online Hotel Bookings are Deceptive
When it comes to booking a hotel, customers are finding it pays to go straight to the source. A new study conducted by the American Hotel & Lodging Association (AH&LA) reveals that one in three people are worried about online booking scams.
Early estimates suggested that some 2.5 million hotel bookings a year were affected by deceptive practices through rogue third-party online travel agency (OTA) affiliates who pose as direct hotel booking sites. The study, conducted by GFK Custom Research, shows that six percent of consumers who have booked hotels online had the experience of thinking they were booking directly with a hotel, but found out instead that they were booking with an online hotel booking site posing as the direct site.
By AH&LA estimates, that translates to some 15 million hotel bookings that have been affected by deceptive rogue affiliates. That translates to more than $1.3 billion in money going to bad bookings, meaning consumers are not getting what they want and need, not to mention suffering inconveniences, lost room charges, and cancellation and booking fees. Another 20 percent of respondents who have booked hotels online reported that they were “not sure” if they had also been scammed.
These deceptive practices harm consumers, who don’t get what they want or need, suffer the loss of reservations or face additional charges and fees. This concern was raised by the Federal Trade Commission which recently warned consumers about these deceptive practices through two consumer alerts highlighting the scams and offering tips to avoid misleading booking sites. These practices also damage hotel reputations and reduce consumer confidence in the online booking process. To read the FTC’s alerts, please click here and here.
“These findings clearly show that online hotel booking scams have eroded consumer confidence among third-party vendors,” said Katherine Lugar, president and CEO of AH&LA. “Consumers deserve transparency in knowing who they are booking with. That is why we have been actively working with state and national government agencies, including the FTC, as well as consumer advocacy groups, to ensure that consumers are protected and can feel comfortable in the booking process. It’s always safest to book directly with the hotel.”
Nearly one-third (32%) of consumers who have booked online using an online travel company booking website, and say they worried about it, have personally experienced the following inconveniences when booking online:
32 percent got a room that was different than what was expected;
17 percent were charged unexpected or hidden fees;
15 percent did not get their rewards points;
14 percent were charged an extra booking fee;
14 percent could not get a refund for a cancellation;
Nine percent had reservations lost or cancelled; and
Three percent had their identity or private information stolen.
The study confirmed that, in order for travelers to be certain they are getting what they want and need, without the frustration and worry, most feel it is better to book directly with the hotel. A majority of those who have booked a hotel online say that they prefer dealing directly with the hotel (56%).
“As we heard from consumers, booking hotel accommodations directly is always your best option—eliminating headaches and hassles during any step of the process,” added Lugar. “When dealing directly with the hotel, consumers can rest easy knowing they have direct access to those who can accommodate their needs.”
METHODOLOGY
The study was conducted online using the GfK “KnowledgePanel,” an online probability-based panel designed to be representative of the US general population, not just the online population. The study consisted of 1,017 interviews conducted between July 10-12, 2015 among adults aged 18+. The margin of error is +/-3 percentage points. GfK is the fourth largest market research firm in the world.
The study, commissioned by the American Hotel & Lodging Association (AH&LA), was administered in an effort to better understand consumer choice and travel trends among the more than 250 million online hotel bookings made annually. For more information on the deceptive practices of online booking sites and consumers tips please visit www.ahla.com.
Early estimates suggested that some 2.5 million hotel bookings a year were affected by deceptive practices through rogue third-party online travel agency (OTA) affiliates who pose as direct hotel booking sites. The study, conducted by GFK Custom Research, shows that six percent of consumers who have booked hotels online had the experience of thinking they were booking directly with a hotel, but found out instead that they were booking with an online hotel booking site posing as the direct site.
By AH&LA estimates, that translates to some 15 million hotel bookings that have been affected by deceptive rogue affiliates. That translates to more than $1.3 billion in money going to bad bookings, meaning consumers are not getting what they want and need, not to mention suffering inconveniences, lost room charges, and cancellation and booking fees. Another 20 percent of respondents who have booked hotels online reported that they were “not sure” if they had also been scammed.
These deceptive practices harm consumers, who don’t get what they want or need, suffer the loss of reservations or face additional charges and fees. This concern was raised by the Federal Trade Commission which recently warned consumers about these deceptive practices through two consumer alerts highlighting the scams and offering tips to avoid misleading booking sites. These practices also damage hotel reputations and reduce consumer confidence in the online booking process. To read the FTC’s alerts, please click here and here.
“These findings clearly show that online hotel booking scams have eroded consumer confidence among third-party vendors,” said Katherine Lugar, president and CEO of AH&LA. “Consumers deserve transparency in knowing who they are booking with. That is why we have been actively working with state and national government agencies, including the FTC, as well as consumer advocacy groups, to ensure that consumers are protected and can feel comfortable in the booking process. It’s always safest to book directly with the hotel.”
Nearly one-third (32%) of consumers who have booked online using an online travel company booking website, and say they worried about it, have personally experienced the following inconveniences when booking online:
32 percent got a room that was different than what was expected;
17 percent were charged unexpected or hidden fees;
15 percent did not get their rewards points;
14 percent were charged an extra booking fee;
14 percent could not get a refund for a cancellation;
Nine percent had reservations lost or cancelled; and
Three percent had their identity or private information stolen.
The study confirmed that, in order for travelers to be certain they are getting what they want and need, without the frustration and worry, most feel it is better to book directly with the hotel. A majority of those who have booked a hotel online say that they prefer dealing directly with the hotel (56%).
“As we heard from consumers, booking hotel accommodations directly is always your best option—eliminating headaches and hassles during any step of the process,” added Lugar. “When dealing directly with the hotel, consumers can rest easy knowing they have direct access to those who can accommodate their needs.”
METHODOLOGY
The study was conducted online using the GfK “KnowledgePanel,” an online probability-based panel designed to be representative of the US general population, not just the online population. The study consisted of 1,017 interviews conducted between July 10-12, 2015 among adults aged 18+. The margin of error is +/-3 percentage points. GfK is the fourth largest market research firm in the world.
The study, commissioned by the American Hotel & Lodging Association (AH&LA), was administered in an effort to better understand consumer choice and travel trends among the more than 250 million online hotel bookings made annually. For more information on the deceptive practices of online booking sites and consumers tips please visit www.ahla.com.