Trivago has hit back at Australia’s consumer watchdog, claiming the “best” deal isn’t always the cheapest.
The court case between the OTA and the Australian Competition and Consumer Commission (ACCC) kicked off on Monday, with the ACCC accusing Trivago of placing deals from companies that offer larger advertising revenue higher than cheaper deals.
On Tuesday Trivago revealed in court how it ranks offers, alleging its algorithm prioritised the best deals for customers based on factors beyond price, such as ease of booking and lack of cancellation fees, according to the Sydney Morning Herald.
On Monday the ACCC produced memos in court that showed Trivago invited advertisers to pay more to “block” rival offers.
Trivago named advertiser payments as the “fourth or fifth” most important factor, with cost-per-click payments acting as a “tie-breaker” on similarly priced offers.
Representing the OTA, Neil Young, QC, presented evidence from two independently commissioned algorithm experts who found it ordered deals by a score based on multiple “dependent and independent factors”.
“The allegation is Trivago selected the top position primarily by cost-per-click … both experts agree that is not the case,” Young said, according to the SMH.
“Trivago selected the top position primarily by reference to the value of the offer price.”
The ACCC’s representation, Norman O’Bryan, maintained the OTA’s algorithm was “the subject of continual intense [internal] scrutiny”, and criticised it for failing to call upon its own algorithm developers to give evidence.
Young also hit back at the ACCC’s allegations around the websites “strike-through” prices that compare different room types, acknowledging that Trivagos strike-through deals were misleading but reiterating the website has since removed the strike-through in favour of red text and a disclaimer.
Trivago told Travel Weekly that while the company acknowledges the ACCC’s position, it believes aspects of its arguments are unfounded.
“We vigorously dispute the allegations relating to the information we prioritise when displaying offers on our website. We will be calling expert testimony to support our case,” the company said in a statement.
“We’re constantly improving the services available through our website with the interests of Australian consumers in mind, and our advertising aims to reflect the significant benefits we provide. This includes changes we made to our Australian website and advertising over the past several years to address the ACCC’s concerns.”
Trivago has already admitted to some of the watchdog’s claims, which carry a fine of up to $1.1 million per breach.