Travel metasearch platform Trivago is facing action from Australia’s competition consumer watchdog over alleged misleading ads.
The Australian Competition and Consumer Commission (ACCC) has started proceedings against Trivago, alleging it made misleading promises over prices in TV adverts and on its website, violating Australian consumer law.
The ACCC alleges Trivago made claims that it offered an impartial service to find the cheapest available hotel room rates but in fact showcased most prominently advertisers paying the highest cost per-click fee.
Trivago’s business model is cost-per-click whereby it receives money when a customer clicks through onto the advertiser’s site.
"Based on Trivago’s highlighted price display on its website, we allege that consumers may have formed the incorrect impression that Trivago’s highlighted deals were the best price they could get at a particular hotel, when that was not the case," the ACCC said.
"We allege that because of the design of Trivago’s website and representations made, consumers were denied a genuine choice about choosing a hotel deal, by making choices based on this misleading impression created by the Trivago website."
"This case highlights growing concerns the ACCC has in relation to comparison platforms, and on how algorithms present search results to consumers," the Commission added.
