Competition watchdog flags Agoda’s Singapore website, mobile app for potentially misleading features

Singapore’s competition watchdog has raised concerns with Agoda over several design features on its Singapore website and mobile application that were identified as potentially misleading.

A number of these related to how the presentation and ranking of the search results on Agoda failed to reflect that they were influenced by money that businesses paid the platform for better visibility.

“The use of user-interface features by businesses which may mislead or even deceive consumers can be considered unfair trade practices under Singapore’s fair trading laws. Businesses engaging in unfair trade practices may face enforcement action by the CCCS (Competition and Consumer Commission of Singapore),” the statutory board said on Monday (Jun 16).

Agoda – a travel platform helmed by CEO Omri Morgenshtern – has since cooperated to amend its website and mobile application so that consumers get accurate and adequate information to inform their purchases, the competition watchdog said.

One potentially misleading feature was the “Best Match” label, which suggested that results with the label were those most compatible with users’ search criteria, such as travel dates or guest ratings, when in fact, Agoda’s algorithm factors in the money the platform will earn when producing the search results.

The company has since replaced the “Best Match” label with an “Our Picks” label to better reflect that the results are its recommendations, CCCS said.

Another was the “Agoda Preferred” badge which appeared on selected properties along with an explainer that read: “Agoda Preferred recommends trusted and verified properties that have a longstanding relationship with Agoda and meet certain criteria”.

The CCCS was concerned that the explainer did not fully explain the criteria, including the fact that businesses had to pay Agoda more for the badge. The company has since revised the explainer to disclose that properties with the badge pay it additional commission.

Another concern was over how the ranking of accommodation search results could potentially lead consumers to believe that the listings were ordered solely based on their search parameters when, in fact, the accommodation providers could boost their visibility by paying Agoda to do so under its “Preferred Partner programme” or by sponsoring their own listings.

Agoda has revised the explainer to clarify that money it is paid is a factor that influences the rankings of accommodations.

Another potentially misleading feature was the “Cheapest x-star” label, which CCCS was concerned might suggest to consumers that labelled accommodations were the lowest-priced option available when, in fact, the search results are sorted by price among options of the same star-rating. To avoid confusing customers, Agoda removed the label altogether.

The competition watchdog was also concerned that the website’s five-minute countdown timer that would run as consumers input their details to complete bookings – which had an initial five-minute limit that could be extended up to 20 minutes by clicking a button – could create a false sense of urgency and rush consumers to quickly complete the booking.

Agoda has since standardised the website’s countdown timer with that of its mobile application, to run for 20 minutes instead of five, to give consumers more time to finish their bookings or shop around for better options.

The CCCS emphasised that businesses should design their user interface to present options in a clear and neutral manner so that consumers can make well-informed choices.

Important and material information, particularly those relating to pricing, should be presented upfront and not be hidden in fine print, CCCS noted.

Statements regarding businesses’ practices and policies should be clear and easily understood, it added.

Chief executive of CCCS Alvin Koh said that the competition watchdog makes it a point to educate consumers on identifying misleading practices and on how to protect themselves.

Consumers may face undue pressure to complete their transactions, or encounter problematic website features and “dark features” such as misleading messages and manipulative user interfaces, Koh added.

Source: The Business Times © SPH Media Limited. Permission required for reproduction.

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