CONCERTTICKET

*$10

Protecting consumers from hidden costs

ENDING SNEAKY FEES

AUGUST 2017

BOOKING FEE

$65*TICKET

ENDING SNEAKY FEESSneaky fees are misleading consumers about real prices. These extra charges – often disguised as “booking fees”, “service fees” or even “print your own ticket fees” – are added to the advertised price of goods and services. The fees can add anything from a few dollars to more than $50 to the product price.

The solution: all-inclusive pricing rules are needed to make retailers disclose the full costs upfront and protect consumers from hidden fees.

COSTS TO CONSUMERS

We estimate consumers could be paying up to $68 million each year in hidden fees. Our research found more than two-thirds of consumers have had these fees added to the cost of products they buy.

In the past year, 65 percent of consumers have been faced with paying extra charges on at least two occasions. More than a third (39 percent) have been charged extra three or more times.

Most consumers agree these charges aren’t fair and want retailers to disclose the full purchase price upfront. More than 10,000 people have signed our petition calling for all-inclusive pricing rules.

I JUST BOOKED A BUS TICKET ADVERTISED FOR $22 AND WHEN I WENT TO PAY SUDDENLY THERE WAS A $3.99 BOOKING FEE ... ALMOST 20%. JUST SEEMS A RIP-OFF TO ME!!

ENDING SNEAKY FEES2

I WENT TO PURCHASE TICKETS FOR A SHOW. TWO TICKETS @ $85 EACH = $179.38. HMMM, AN EXTRA $9.38 – FOR WHAT??

HOW DO YOU FEEL WHEN ADDITIONAL CHARGES

ARE ADDED TO THE PRICE OF A GOOD OR SERVICE?

HAVE YOU EVER HAD TO PAY EXTRA

FEES ON TOP OF THE ADVERTISED PRICE?

IN THE PAST 12 MONTHS, HOW MANY TIMES HAVE YOU BEEN FACED WITH

THESE FEES?

ON AVERAGE, HOW MUCH EXTRA HAVE

YOU HAD TO PAY PER PURCHASE?

� Up to $10�$11 to $20�$21 to $50 �$51+

� I don’t like it – retailers should have to disclose the full price upfront� It annoys me a bit but I accept it’s common business practice� It doesn’t bother me at all

� Undecided

� Yes� No

� Can’t remember

�Once �Twice� Three times �Four times

� Five or more times � Not in the past 12 months

68%25%

3%4%

68%

18%

13%

22%

26%

16%

8%

15%

13%68% 21%

13%

1%

ENDING SNEAKY FEES 3

GUIDE TO THE GRAPHS OUR DATA are from a nationally representative survey of 1024 New Zealanders, aged 18 years and older. The survey was carried out online in December 2016. Figures may add to +/- 100% due to rounding. The margin of error of +/-3.06%.

Consumers encounter sneaky fees across a range of purchases, from buying flowers to booking a holiday or buying a car.

ONLINE FLORIST PETALS1

SNEAKY FEES AT PLAY

ONLINE FLORIST INTERFLORA2

Online florist Petals advertises flowers priced at $54.95. But extra fees mean the actual cost you pay is $65.90.

$54.95

ADVERTISED PRICE

$65.90AFTER FEES

ADDED

Competitor Interflora’s advertised price is $63.70. But after fees, the actual cost is $77.20.

$63.70

ADVERTISED PRICE

$77.20AFTER FEES

ADDED

ENDING SNEAKY FEES4

I’VE JUST LOOKED AT OUR BILL FOR AN AIRBNB STAY

IN AUCKLAND. THE WEBSITE SAYS $71 FOR THE ROOM. THE

BILL SAYS $79 PLUS SERVICE FEE $13: SO FROM $71 TO $92.

QUITE A JUMP.

HOLIDAY RENTAL SITEBACHCARE3

$100

ADVERTISED PRICE

Holiday rental site Bachcare advertises per night rates of $100. But after service fees are added, you’ll pay $137.50.

AFTER FEES

ADDED

$137.50

ENDING SNEAKY FEES 5

SPORTS EVENTSHURRICANES4

MUSICALSWEST SIDE STORY5

DO NOT UNDERSTAND WHY I HAD TO PAY $5 TO BE ABLE TO PICK UP THE TICKETS FROM THE SHOW LOCATION.

Tickets to see the Hurricanes are regularly advertised at $25. But after fees, the actual ticket price is $30.38.

$25

ADVERTISED PRICE

Tickets to see West Side Story at The Civic were advertised online for $89.90.But the actual price you had to pay was $96.97.

$89.90

AFTER FEES

ADDED

ENDING SNEAKY FEES6

$89.90

ADVERTISED PRICE

$96.97AFTER FEES

ADDED

$30.38

MOVIE TICKETSBERKELEY MISSION BAY6

$10.90

ADVERTISED PRICE

$12.10AFTER FEES

ADDED

MOVIE TICKETSEMBASSY CINEMA7

ADULT SEASON PASSMT RUAPEHU8

$999

ADVERTISED PRICE$1021.48AFTER FEES

ADDED

I WAS STUNG WITH $60 EXTRA WHICH I HADN’T FACTORED IN.

If you’re heading to the slopes, you can find a season pass for Mt Ruapehu advertised at $999. But after fees, the price rises to $1021.48.

At the Embassy Theatre, extra fees mean $10 online tickets will cost you $11.20.

At Berkeley Mission Bay, movie tickets are advertised online at $10.90. But after fees, the real price is $12.10.

$10

ADVERTISED PRICE

$11.20AFTER FEES

ADDED

ENDING SNEAKY FEES 7

BUYING A CARMITSUBISHI PAJERO9

BUYING A CARFORD AMBIENTE10

$40,990

ADVERTISED PRICE

$41,880AFTER FEES

ADDED

WHEN WE GOT TO THE AIRPORT TO COLLECT THE CAR, LO-AND-BEHOLD, AN EXTRA $46+ WAS CHARGED AND SHE CALLED IT AN ‘ONLINE BOOKING FEE’!!

After fees, you’ll pay $60,890 for a Mitsubishi Pajero Exceed, even though it’s advertised as $59,990.

If you’re tempted by the $40,990 advertised price for a new Ford Ambiente, you’ll have to budget $41,880, the actual cost of the car after fees.

$59,990

ADVERTISED PRICE

$60,890

AFTER FEES

ADDED

ENDING SNEAKY FEES8

FIXING THEPROBLEM

The Fair Trading Act (FTA) prohibits misleading representations about price. However, the act hasn’t been effective at preventing retailers from adding extra fees to the advertised price of goods and services.

The Commerce Commission has recognised the problem, pointing to a growing trend of retailers separating out additional costs from the headline price. It’s previously stated all-inclusive pricing rules would substantially assist enforcement of the FTA.

Other countries have taken action to provide consumer protection from hidden charges. In Australia, companies are prohibited from advertising a component of a price without prominently displaying the total amount the consumer must pay.

Price plays a significant part in consumers’ purchasing decisions. But when advertising obscures a product’s real cost, consumers can be misled into making decisions they would not otherwise have made.

All-inclusive pricing rules are needed to ensure consumers can easily identify the price of a product and make informed purchasing decisions.

MY SON WENT TO WATCH A RUGBY MATCH LAST FRIDAY AND THE TICKETS WERE ADVERTISED AT $15. HE GOT THERE TO PAY FOR THE TICKET AND WAS TOLD IT WOULD BE $18.50!

ENDING SNEAKY FEES 9

WE BOUGHT TICKETS TO THE RUGBY … THEY

CHARGED AN EXTRA $3.50 PER TICKET SO A $5 CHILD’S TICKET REALLY

BECAME $8.50.

WHAT REALLY ANNOYED ME WAS THAT YOU COULD

ONLY PAY BY CREDIT CARD (NO DOOR SALES) SO YOU WERE FORCED TO PAY

THE CREDIT CARD FEE.