ACCC takes action against Meriton over online reviews

24 November 2016

The Australian Competition and Consumer Commission has instituted proceedings in the Federal Court against Meriton Property Services Pty Ltd, trading as ‘Meriton Serviced Apartments’ (Meriton).

The ACCC alleges that Meriton engaged in misleading or deceptive conduct in connection with the posting of reviews of its properties on the TripAdvisor website.

TripAdvisor offers a service called ‘Review Express’ where participating businesses provide TripAdvisor with email addresses of recent customers who have consented to passing on their details. TripAdvisor then emails the customers, prompting them to submit a review of their recent experience with that business.

The ACCC alleges that from November 2014 to October 2015, Meriton took steps to prevent guests it suspected would give a negative review from receiving TripAdvisor’s ‘Review Express’ email to avoid them posting potentially negative reviews.

It is alleged that this was done by inserting additional letters into guests’ email addresses provided to TripAdvisor so that the email addresses were ineffective, and not sending other guest email addresses to TripAdvisor. 

On several occasions Meriton engaged in this conduct in respect of the majority of guests that stayed at one of its hotels during periods where infrastructure or services failed, such as no hot water or a lift not working, in an attempt to ensure that guests would not receive TripAdvisor’s ‘Review Express’ prompt email in case they left an unfavourable review.

“We allege that Meriton’s conduct was a deliberate practice, undertaken at the direction of Meriton’s senior management, aimed at minimising the number of negative reviews. This practice was likely to create a more positive or favourable impression of the standard, quality or suitability of accommodation services provided by Meriton,” ACCC Commissioner Sarah Court said.

“Consumers rely on independent review platforms like Trip Advisor when making purchasing decisions.  If reviews are manipulated to falsely create a more favourable impression about a provider, consumers may choose that provider on the basis of that falsehood over another accommodation provider who has not engaged in misleading conduct.”

The ACCC is seeking pecuniary penalties, declarations, injunctions, corrective publication orders, orders for the implementation of a consumer law compliance program and costs. 

Background

Meriton offers accommodation under the brand Meriton Serviced Apartments. During the relevant period, Meriton offered serviced apartment accommodation in at least 13 properties in New South Wales and Queensland. Meriton is part of the Meriton Group of companies.

TripAdvisor operates websites in 48 markets worldwide, providing free online reviews of accommodation services and other travel-related content generated by travellers.

TripAdvisor states that accommodation providers that regularly use the ‘Review Express’ service, which sends guests a prompt on behalf of accommodation providers, see an uplift of 28 to 33 percent in TripAdvisor reviews for their properties.

Release number: 
MR 218/16
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