Improving price transparency for guests and changing incalculable fees
We want to make sure guests know the exact price of their reservation when they book, with no hidden fees popping up later. Price transparency is important because when prices are clear:
- Guests can make well-informed decisions during the booking process
- Properties can manage and meet guest expectations, and offer better experiences (which leads to higher review scores)
- Properties can perform better on our site long-term (e.g. clearer prices convert better)
- Properties can reduce operational overheads (e.g. clearer prices are linked to fewer cancellations)
- Properties are in a stronger position to be fairly compared against each other in a quick and clear way.
What actions are we recommending that you take?
Check your incalculable fees and taxes
To improve price transparency for guests and be compliant with EU consumer law, from 1 September 2019 we’ll start imposing restrictions on fees and taxes that are set as ‘incalculable’ in the Content API (e.g. fee types set to ‘charges may apply’). After this date, the only extra fees and taxes that can still be set as incalculable are the following five utility fees (billed based on usage):
- Electricity fee
- Gas fee
- Oil fee
- Water usage fee
- Wood fee
Aside from these five utility fees, from 1 September 2019, any other type of fees or taxes set as incalculable will no longer be shown on Booking.com. It’s also important to note that properties will not be able to set incalculable fees via their connectivity provider – any non-permitted fees they set in the extranet will be overwritten by the provider software.
Incorporate as many costs as possible in room rates in the calendar
User research has shown that guests prefer properties with no or fewer extra charges, as they feel they’re getting a better deal. Extra charges distract potential bookers, as they don't always understand what it's for – and they often choose another property instead.
Avoid adding any fees to the fine print, property description or house rules.
When it’s not possible to specify a certain fee, properties may consider adding it to the room rate. If it’s an optional fee, though, avoid specifying it in the fine print, as potential bookers could mistake it for a mandatory fee and choose another property instead. We’re working on a solution to display optional fees, but for now you should leave them out and mention them to guests during their stay.
How do these changes tie back to our commission?
Being transparent with all fees may indeed contribute to accommodation partners paying commission on them, but this would be offset by greater gains through:
- Increased bookings
- Increased visibility
- Improved reputation (due to higher guest review scores)
- Fewer operational costs
- Happier in-stay guest interactions, resulting in more in-stay consumption of services
That’s why we encourage you to think long-term while doing the right thing for potential guests.