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Expedia recently put hotels on notice regarding resort fees. Expedia.com will now be pushing hotels that charge resort fees lower in search results. That means that hotel brands that charge extra for amenities and features could lose a lot of bookings among Expedia customers due to a lack of visibility. All of this is just one more stage in the saga of resort fees within the hotel industry. Both Marriott and Hilton are currently being sued by state governments on the premise that resort fees are deceptive and misleading.
Expedia and other third-party booking platforms aren't fans of resort fees. In fact, they have absolutely nothing to gain from the 'hidden' resort fees that hotels often charge guests. What's more, Expedia and its peers actually have a lot to lose from the fees. Customers who book through Expedia are often irate after discovering that there are hidden costs being added to their reservations. Those customers often blame Expedia for the costs. The bottom line is that hidden resort fees hurt Expedia's reputation because customers feel that Expedia has lied to them regarding true booking costs. Expedia's announcement regarding search-result rankings for hotels that charge hidden fees is part of a plan to increase transparency. However, we don't know just how much resort fees will actually impact search rankings on Expedia.com. Expedia's algorithm for how it serves hotel options to users is obviously a secret. It is possible that resort fees alone won't be enough to dramatically drop a hotel's ranking. Factors like room rates and hotel quality are still going to impact what customers see whey they search. However, brands that operate in an industry as competitive as the hotel industry don't really have a lot of room to risk reduced visibility. Expedia isn't the only booking platform to penalize hotels that charge hidden fees. Booking.com also recently announced that it would be collecting commissions on resort fees.
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Jim Hepple is an Assistant Professor at the University of Aruba and is Managing Director of Tourism Analytics. Archives
October 2020
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