Price comparison websites like Priceline.com, Skyscanner and even Expedia are hated by airlines. They primarily rank airfares based solely on price – from low to high. More often than not, whichever airline offers the lowest fare wins the consumer’s credit card details.
Nevermind if the flight takes off at a lousy time and comes completely unbundled without even hand baggage allowed (see United’s basic economy product). It’s super cheap and the price comparison site has allowed you to find an amazing bargain.
So big is the draw of saving money on flights that in one survey conducted by priceline.com, 44% of respondents claimed getting an airfare bargain was better than sex. An even larger number of people (69%) even said a cheap ticket ranked better than hanging out with their friends.
But priceline.com, part of the larger Priceline Group which also owns popular travel booking sites like booking.com, Kayak and OpenTable might be in hot water over claims it always offers the lowest price – or what it calls its “Best Price Guaranteed” promise.
It turns out that priceline.com wasn’t offering the Best Price at all on ticket prices for one ultra-low-cost airline. At least that’s what Tycko & Zavareei litigation attorneys in Washington D.C. have charged against the company. They’ve started a class action lawsuit against Priceline claiming priceline.com added “it’s own markup” on Spirit Airlines flights.
The Home of the ‘Bare Fare’ it turns out is always on spirit.com – something that priceline.com never told it’s users and was completely contrary to what the website claimed in its advertising.
“It is plausible that a reasonable consumer would interpret the contract language to include a promise not to add hidden surcharges,” Judge Chatigny of the U.S. District Court for the District of Connecticut said in a recent ruling.
His comments came as he rejected priceline.com’s motion to have the lawsuit thrown out. Now lawyers are inviting more consumers to join the lawsuit against Priceline, as well as other price comparison websites who may have sold tickets under similar circumstances.
The litigation comes as criticism mounts against the price comparison websites that now dominate the way consumers search for and buy travel. Critics say the system is broken and is now doing more to harm the passenger experience than improve it.
It’s all down to the need to offer the lowest possible airfare – and therefore rank high in the search results. As a result, even the oldest of legacy full-service airlines have unbundled their airfares and added ancillary service charges. The base fare is cheap but consumers are confused – what was once included in the price is now an added extra.
Of course, airline’s would much prefer consumers to book tickets direct because it increases their own revenues – after all, price comparison websites are taking a cut from every sale. That’s why Lufthansa took the extreme step of adding a charge to all online travel agency bookings in 2015. The only way to avoid the charge is to book directly with Lufthansa.
International Airlines Group (IAG) – the owner of British Airways, Iberia and Aer Lingus will introduce a similar charge in November. Other airlines restrict the data that price comparison websites and OTA’s can pull from the airline’s reservation systems – the idea is to force consumers into booking direct.
At one time, Ryanair even blocked their fares from appearing on price comparison websites at all – of course, eventually, the power of the OTA’s became so strong that even Ryanair was forced to backtrack.
Some comparison sites are trying to move away from just price – routehappy.com for example, scores flights based on the amenities that airline’s offer and a host of other factors to display what they consider the ‘best’ flights available for what the consumer wants. But quite frankly, this is small fry compared to the bulk of OTA bookings being made.
Even mega airline Emirates has signalled that price comparison sites are threatening its very business model. Recently, the airline’s president, Tim Clark spoke of how OTA’s were forcing it to rethink its strategy. Emirates has seen its revenues dive as it tries to compete with low-cost carriers who always rank higher on price comparison websites.
