UK competition body urges hotels to vary OTA pricing

The UK Competition and Markets Authority (CMA) is urging hoteliers to increase competition by varying the deals they offer on online travel agency (OTA) platforms.

The CMA told hotels this week they can offer “a lower price on other OTAs than on Expedia or Booking.com”.

The UK authority was one of 10 EU competition regulators involved in a recent Europe-wide study of hotel, OTA and metasearch site pricing.

This found 79% of hotels had not varied the price of rooms across OTA platforms since 2015 when Expedia and Booking.com agreed to stop insisting on price-parity clauses following an EC investigation.

The research found 47% of hotels surveyed were not even aware that Booking.com and Expedia had dropped such clauses.

The CMA published guidance for hotels this week on setting prices for OTAs.

Ann Pope, CMA senior director, said: “Research shows that hoteliers were not always aware of their rights when it came to pricing their rooms on large platforms such as Expedia and Booking.com.

“We have published this guidance to raise hotels’ awareness of the changes and the freedom they now have over pricing, to help improve competition in the market.”

The CMA advice states: “Hotels can choose to offer a lower price on other OTAs than they offer on Expedia and/or Booking.com.

“Hotels can also decide to offer other OTAs better availability or conditions (such as extras or ‘breakfast included’) than on Expedia and/or booking.com.”

Among other “things you should know”, the CMA advises hoteliers:

• Expedia and Booking.com have also committed to allow hotels to offer lower prices in “offline” marketing channels than their prices on OTAs (provided that such “offline” rates are not published or marketed online by hotels). • In other words, hotels can offer any price they wish to customers in person, by phone, direct email or through private closed-user groups (eg hotel loyalty groups). • However, OTAs, including Expedia and Booking.com, may still have clauses in their contracts which stop hotels charging lower prices on a hotel’s own website than they offer through OTA websites. • Hotels should be aware of the points above when negotiating terms with OTAs.