Typically when we buy something, we're accustomed to paying the listed price, plus a mandated tax on the item. But recently we've become accustomed to seeing additional fees on purchases that aren't listed in the purchase price. This is already common practice for things like utility bills, cell phone bills, and car rentals. But over the past decade, this practice has extended to the internet in some incredibly shady ways.
Ever booked a hotel room and been forced to fork over an extra $15 or $20 a night at the front desk, on top of what you already paid to book the room? You may or may not have been aware of this charge called a "Resort Fee", a completely bogus charge some hotels are resorting (no pun intended) to, in order to maintain profit margins but still appear competitive on their price.
How does it work? Imaging you're filtering for 4-star hotels, then sorting by price, lowest to highest. "Wow," you say, "I found an amazing 4-star hotel for $90 a night!" Not so fast. If you look closely, you'll see a Resort Fee of something like $20 per night, payable to the hotel upon arrival. So what's going on? Well, for that hotel to appear in the top results for the price range, they lower their price but make back that amount in the form of a fee that isn't included in the price.
I recently came across an incredibly shady example of this fee on a Travelzoo deal:
"A resort fee of $15 per night is not included and will be paid directly to the hotel. This fee covers Wi-Fi, pool access, spa access (may be limited), fitness center access, newspaper, phone calls (may be limited), in-room coffee, in-room bottled water, self parking, valet parking and additional inclusions."
Travelzoo is all about great deals, but if you factor in the extra $15 you're going to have to fork over, you have to question if it's really that great of a deal. But the most offensive part is that this hotel is communicating this fee covers things like self-parking, coffee, fitness center access, and even pool/spa access! We all know even the most basic hotels have offered this forever at no additional charge. This is a blatant way to make back the profit they would have lost by actually offering a deal.
These tactics extend to things far beyond hotel bookings. Ever bought a car and thought you got a great deal? You should watch this video about the four square model, the model that every car dealership uses to make sure they make a certain profit on every car sale. Oh, and that dealer fee you may have paid from anywhere from $200-$750? Yeah, that's just a bogus fee - doesn't actually cover anything. It just goes toward making your purchase price appear lower.
Fortunately, there are some sites that actively try to give you an out-the-door price, which I really appreciate. Stubhub shows you your out-the-door price per ticket to an event. Southwest shows you the out-the-door price on an airline ticket - it includes all the bogus government fees.
I have declared war on these types of bogus fees. I try to avoid them as much as I possibly can and I hope I can convince you to do the same, when at all possible.