An internet display ad on a weather forecast website, for Booking.com, stated "Sydney Park Hyatt Sydney £536 save £1372 for 3 nights". A button underneath, with the text "BOOK NOW", linked to the advertiser's website.
The complainant challenged whether the claim "save £1372 for 3 nights" was misleading and could be substantiated.
Booking.com said the savings claim stated in the ad was the result of an error. A bug in the system of the third-party company which ran their ads meant that the minimum rate and maximum rate used to calculate the savings were not for the same room. The error had resulted in an exaggerated savings claim. Booking.com said they had contacted the third-party company and requested that they immediately fix the bug to ensure such errors would not occur in future.
The ASA asked for further information as to how the savings claim in the ad should have been calculated. Booking.com said their savings claims were based on a comparison of the price of a hotel room on the dates selected by a website visitor with the third highest price for the same room (including the same booking conditions) within 30 days around the selected check-in date. The savings claim in the ad should therefore have related to the difference between the cost of the third highest price for a three-night stay in the room at the Sydney Park Hyatt in the 30 days around the check-in date selected by the complainant and the cost of the room on the dates they had actually selected when they had searched for hotel prices on Booking.com. On their website, that higher 'comparison window' price would be displayed, crossed-out, next to the price for the room on the dates selected by the website visitor.
Booking.com said their 'comparison window' system of calculating crossed-out rates was a fair and balanced price comparison in the context of the complex ways in which hotel rooms were priced. They said the industry used three pricing models, all of which might apply at the same time, and as a result there was usually more than one price for the same room at the same hotel on the same night, depending on which pricing model was being used and from where the consumer was accessing the price information. They believed that by taking the third highest price in a 30-day window around the selected check-in date, they countered the risk of hoteliers artificially manipulating prices and enhancing savings claims by making a few prices within the window extremely expensive.
Booking.com said the basis of their savings claims was clearly displayed to website users in various places on their website. For example, when users hovered their mouse pointer over the crossed-out prices in hotel search results, a pop-up box appeared that stated "The crossed out prices you see are based on prices currently being quoted by the hotel for a 30-day window around your check-in date. To ensure we are making a fair comparison, we always use the same booking conditions (meal plan, cancellation policy and room type)". Further information in their terms and conditions stated "From the prices within this [30-day] window, we display the third-highest price on offer as the crossed-out rate ... This means that you get the same room for a lower price compared to other check-in dates at the same time of year".
The ASA understood that consumers who visited the Booking.com website and entered specific search criteria would have information stored in a cookie (a small piece of data sent from the website that could later be retrieved) on their web browser. That information about their previous search activity could then be used to generate ads that were likely to be of greater interest to them, which would appear when they visited other websites. We understood that in this instance the complainant had looked at prices for rooms at the Sydney Hyatt hotel for the period 21 to 23 January 2013.
We noted Booking.com's explanation that the savings claim "save £1372 for 3 nights" had been wrongly calculated due to a bug in the system of the company which ran those ads. We welcomed their willingness to resolve that calculation error. However, we were concerned that even if the bug was corrected, the basis on which the savings claim in the ad should have been calculated was problematic under the requirements of the CAP Code.
We understood the complainant had been served the ad because they had previously used Booking.com's website to search for room rates. We noted the complainant might therefore have seen crossed-out rates, and the explanatory text about those rates, as part of those search results. However, we noted that the complainant's understanding of the claim "save £1372 for 3 nights" in the ad, which was served to them on a third-party website, had been that by using Booking.com's website to book the hotel they would be receiving a discount. We considered the majority of consumers, even those who had seen crossed-out rates on Booking.com's website, would understand the claim "Sydney Park Hyatt Sydney £536 save £1372 for 3 nights ... BOOK NOW" in the ad to mean that by booking the hotel through Booking.com, they would save £1372 compared to booking the same hotel, on the same dates, through another provider, or that they were being offered a discount by Booking.com on its own price.
We understood that Booking.com's savings claims were calculated by comparing the price for a specific room type at a specific hotel on specific dates with the third highest price for the same room type at the same hotel in the 30 days around the selected check-in date. If the room was cheaper on the days selected by the consumer, an ad such as that seen by the complainant would reference the higher price by stating that the consumer could "save £[X amount] for [X] nights". We considered, however, that that price comparison did not constitute a genuine savings claim, because the "save £[X amount]" claim did not reference an alternative price at which the room was available to consumers on the dates during which they wished to stay at the hotel, either through other providers or as a discount on Booking.com's own price for the room during those dates. Instead, the savings claim was based on a price the consumer might pay if they chose to book the room at some other point in the surrounding 30 days.
We considered that even if the particular savings claim stated in the ad had been calculated correctly based on Booking.com's comparison window system, it would not have related to the specific product/service featured in the marketing communication (the hotel, room type, booking conditions and dates of stay), but rather to a different product/service (the same hotel, room type and booking conditions, but different dates of stay), which constituted a breach of Code rule 3.17 3.17 Price statements must not mislead by omission, undue emphasis or distortion. They must relate to the product featured in the marketing communication. We concluded the savings claim stated in the internet display ad was misleading to consumers.
The ad breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation) and 3.17 3.17 Price statements must not mislead by omission, undue emphasis or distortion. They must relate to the product featured in the marketing communication. (Prices).
The ad must not appear again in its current form. We told Booking.com that they should not make savings claims that were not genuine.