Commissioner's Blog: Comparison websites may not paint full picture

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All announcements issued prior to 1 July 2017 were issued by the former Department of Commerce. Announcements listed here are the latest versions available, but may be subject to review. For more information on this announcement, please contact online@dmirs.wa.gov.au.

This announcement is for: 
Consumer

With Acting Commissioner for Consumer Protection David Hillyard

When you’re looking for flights or accommodation, insurance or finance products or even a real estate agent there are comparison websites claiming to have shopped around for you. They may advertise on TV and radio and their online promotion often involves them paying to make their site appear toward the top of the page when you type certain words into your search engine.

Comparison websites may save you time and money by displaying a number of goods or service suppliers side by side in a way to help you choose the best price and value. However, you might not be comparing apples with apples and in fact there could be some lemons thrown in. Sites may use their own ratings or review systems and this can blur perceptions of what’s on offer.

The Australian Consumer Law applies when buying from an online business just as it would at a physical store. On comparison websites:

  • the representation of what you’re buying should be truthful and accurate, for example “deluxe” or “premium” should not be used to describe budget accommodation; and
  • any commercial arrangements, such as a real estate agent comparison site receiving commission for a referral, should be disclosed.

Case study: A couple with a child booked a 3 person occupancy room on a hotel comparison website but when they got there, the booked room had one queen size bed and no other sleeping option. The overseas-based comparison site only took complaints via email and didn’t respond. The couple had to pay the hotel directly for a room upgrade.

It’s important to remember that when an online business is outside Australia it can be hard to get in touch with them to exercise your rights. Even if you come to Consumer Protection we may face the same difficulties trying to get a response on your behalf.

Tips:

  • Know the limitations of what’s compared on each site. Not all industry participants may be included. Check a range of comparison sites against each other to be sure the information you are looking at is comprehensive, reliable and current. Also explore the cost of a direct booking with a supplier.
  • Find out if a commercial relationship exists. Does the website receive financial inducements from listed businesses in return for recommending them? Is the website owned by the same business that owns the products being compared?
  • Think about more than just price. The cheapest airfare for your chosen destination may be a long journey with a layover as opposed to a short, non-stop flight that’s not that much more expensive. Filter results so they’re listed in order of what you need, such as certain coverage on a health insurance policy.
  • Read the privacy policy. How will any personal information you supply be used? Passed on to third parties or on-sold?
  • Calculate the total cost. A headline price may be click bait and when you get to the payment stage of the transaction it could be more than you thought because of additional fees and charges not disclosed in the promoted dollar amount.
  • Keep a record of transactions and contact. Take down reference numbers, keep screen shots and emails and note down details of any telephone calls; name of the operator, date and time of conversation.
  • Make use of independent sites. A number of Government sites have been established to enable consumers to make meaningful comparisons. Examples include our own FuelWatch (www.fuelwatch.wa.gov.au) and nationally there’s www.privatehealth.gov.au where every health insurer is required to provide up-to-date information about what is covered by each policy and its prices.

The Australian Securities and Investments Commission (ASIC) monitors comparison sites in the financial product marketplace and has a guide for industry available at www.asic.gov.au

Consumer Protection
Media release
27 Apr 2017

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