FTC chief calls for resort fee ban
To stop hotels from charging hidden resort fees, Federal Trade Commission Chairwoman Edith Ramirez has suggested that Congress draft new legislation instead of having the consumer protection agency investigate hotels on a caseby-case basis.
Ramirez called for such legislation in a letter last week to 10 U.S. representatives who had called the fees “a deceptive and unfair trade practice.”
The discussion about how to combat mandatory resort fees that don’t appear on advertised hotel fares has gained urgency in recent months with the growing demand for holiday travel and increasing complaints from consumer groups.
A new study by a nonprofit consumer advocacy group found that such resort fees are on the rise, with nearly 200 hotels in California charging an average mandatory resort fee of $17 per night. The group, Travelers United, say the fees are unfair because they don’t appear on the advertised rates and most hotel guests don’t see the charge until they check out.
Ramirez said her agency has tackled the problem by warning individual hotels to make sure that the fees are displayed prominently and early in the booking process. But the best way to ban the practice, Ramirez said, is for Congress to adopt legislation.
“In my view, however, the most efficient and effective means to mandate the type of industry-wide requirement you propose would be through legislation,” she wrote to the members of Congress.
The American Hotel and Lodging Assn., a trade group for the nation’s hotels, said the number of hotels that charge mandatory resort fees is on the decline — only 7% of all hotels in 2014 — and those that do so disclose the fees clearly.
“The lodging industry provides guests full disclosure for resort fees charged upfront,” said Rosanna Maietta, a spokeswoman for the group. “Those fees, in addition to the base travel and hotel charges, remain transparent whether consumers book online or with the hotel directly.”
More onboard sales pitches are likely
Bad news for airline passengers who are tired of getting their wallets squeezed when boarding a plane: The future of air travel will include a lot more onboard sales pitches.
That is the conclusion of a new report by Guestlogix, a technology company that helps airlines and train operators sell to travelers.
With airlines investing heavily to upgrade their often spotty and too-slow onboard wireless Internet, the study concluded that carriers will be better equipped to sell fliers entertainment, food and even tickets to theaters and theme parks in the cities they’re visiting.
“For airlines, the basic framework is already in place for upsell opportunities, and airlines’ desire to sell to passengers from their own websites will push them to offer products and services beyond airline tickets,” according to the Guestlogix report.
U.S. airlines offer at least “some chance” of Wi-Fi service on 66% of their f lights system-wide, according to a 2015 study by the travel rating site Routehappy.com. And airlines executives say they are investing heavily in faster satellite-based Internet service, onboard servers and seat-back entertainment screens.
Among other predictions, the Guestlogix report says airlines will rely on past sales data and loyalty reward information to identify and target the big spenders on each plane.
For example, the report said airlines can tell if you are a loyalty reward member or a good candidate to sign up for the program. The data can also let airlines know whether to offer you wine or more expensive champagne with your meal as well as a drama or a comedy for your in-flight movie.
Chris Gardner, an executive vice president at Guestlogix, said the key to pitching passengers to spend on such extras without annoying them is to offer them goods and services they can use.
“The airlines are going to need to do it with a little service and added value,” he said. “You have to do it to make people’s lives a little easier, not to nickel-anddime them.”