THe relationship between AFTA and Webjet reached a new low last month when the federation lodged a formal complaint with the Australian Competition and Consumer Commission, alleging the OTA had engaged in misleading and deceptive practices. A number of issues are highlighted in the complaint letter, including a claim that Webjet is “seeking to gain market share through the use of misleading comparative advertising”.
Certain to hit the hot button at the ACCC, the suggestion is that the heavy promotion of Webjet’s “exclusives” holiday packages, which seem to imply massive discounts, has used deliberately inflated ‘typical price’ comparisons to exaggerate the potential savings to consumers. AFTA has highlighted a major promotion in News Limited newspapers early in August where Webjet showcased an 11-day luxury Botswana private safari, a 21-day China Uncovered tour & yangtze river Cruise, a 16-day Discover Japan tour and a 16-day Treasures of Indochina holiday. “Given the competition and consumer preferences in the Australian market, travel products are not typically sold at the rrP level…AFTA is of the belief that the typical prices listed for the [packages] are false and misleading resulting in unfair comparison,” the letter from AFTA CEO Jayson Westbury to ACCC chairman Rod Sims reads.
While acknowledging that price comparison is a “legitimate marketing strategy if the comparison is truthful,” AFTA notes that the ACCC’s own advice on the matter is that comparisons must take into account the typical price of a product, beyond that of the recommended retail Price. “AFTA has conducted research of the varying elements of the packages and is unable to find the typical price presented by Webjet Limited,” Westbury wrote.
AFTA has also taken exception to Webjet’s continued promotion of itself as a “licensed travel agent” and a member of the now defunct Travel Compensation fund. “ensuring compliance with the Australian Consumer Law is of the utmost importance for AFTA…we therefore have been partnering state consumer affairs departments on strategies for AFTA members. Webjet Limited is not an AFTA member nor do they hold accreditation with the AFTA Travel Accreditation Scheme (ATAS) and as such we believe it is important to refer this matter to the ACCC,” Westbury wrote.
AFTA says Webjet’s claims it is a member of the TCF and a licensed travel agent mean it is “seeking to mislead the consumer by implying that its service is of a higher value than non-licensed travel agents,” demonstrating a “business decision to promote webjet.com.au as a licensed travel agent and member of the TCF to mislead the consumer to drive sales”.
The federation also reiterated its previous complaint about Webjet’s controversial television commercials, which generated a storm of outrage from travel agents when first revealed by Travel Daily. AFTA said the most recent ‘Webjet – Never Out of Date’ television commercial (TVC) provides an incorrect and misleading representation to consumers that the OTA has a unique booking system that other travel agents do not. “Webjet uses fabricated testimonials in each TVC to imply a real experience of consumers [which] creates factually incorrect information to mislead consumers,” Westbury said, urging the ACCC to order that the commercial be removed from all online platforms and television networks.
Webjet has declined all opportunities to comment on any of the controversy.
