Hotels4U rapped by ASA after hundreds of complaints

by Chloe Berman
by Chloe Berman
April 25, 2012 01:36 PM GMT

Hotels4u.com has been strongly criticised for withdrawing a special Christmas Day booking offer early after it got overwhelmed by bookings.

The advertising watchdog received 19 complaints against the Thomas Cook-owned online accommodation supplier over the £50 discount offer promoted via Facebook, Twitter and its website on December 25. A further 500 complained to the company.

Hotels4u told the Advertising Standards Authority that by 6.30am on the day of the promotion, more than 2,600 bookings had been made and this had generated a loss of more than £120,000. This was due to the fact that 2,478 of these bookings had a sales value of lower than £10 after applying the £50 discount.

The offer was expected to attract just 570 bookings. As a result, the promotion was suspended at 7am to investigate why so many bookings had been made so quickly and at such a significant loss.

By 10am it was found that a significant number of customers had made duplicate bookings in breach of the terms and conditions of the promotion and Hotels4u also suspected some potentially fraudulent bookings had been made.

The promotion was reinstated at 11am but during the following hour a further 1,000 bookings were made.

Hotels4u said this far exceeded a normal level of bookings and was much greater than it had anticipated based on past experience.

It could not continue to operate the promotion for the remainder of the day in view of the level of booking activity, the number of duplicate or fraudulent bookings and the potential financial losses to the company, and they therefore closed the promotion early.

A total of 660 duplicate bookings had been made and a large number of the 2,600 bookings made before 7.00am by individuals residing in the Far East had been flagged up as being potentially fraudulent, the company told the ASA.

It did not believe it was viable to implement measures to prevent multiple bookings for a one-day promotion, since the time and cost involved in altering the website booking system would have far outweighed any financial benefits gained from the promotion.

Around 500 customers complained to Hotels4u directly and around 30 had completed a booking without being aware that they had paid full price.  Of these, Hotels4u honoured the discount for around 15 bookings as a “gesture of goodwill” and in all other cases offered to cancel the booking and provide a full refund.

Hotels4u said it had learned many lessons from the promotion and considered it advisable in future promotions to introduce a minimum spend amount.

The company had previously offered percentage discounts and had only begun using fixed price discounts in November 2011.

Hotels4u “sincerely apologised” to the complainants who had brought the matter to the attention of the ASA and “very much regretted” that ity could not continue operating the promotion throughout the whole of Christmas Day.

Upholding the complaints, the ASA said: “We told Hotels4u to take care to ensure future promotions are administered fairly and, in particular, to ensure they make a reasonable estimate of demand and do not end promotions prematurely unless under circumstances outside their reasonable control.”

The authority’s adjudication said: “We considered that Hotels4u could have taken steps to put measures in place to prevent duplicate bookings, either at the start of the promotion or when they became aware of the problem, for example, they could have required customers to register an email address or they could have provided a unique booking code to consumers to ensure that only one booking could be made per customer.”

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