Compliance & Pricing Transparency

International Car Rental Compliance

When I flew over to Austin in Texas to speak to a room full of people about international compliance, the moment the opening screen came up on the display, the groans and sighs around the room were tangible.

I joked that compliance had become the sexiest part of my job since the dancing pole had been removed from the office. That gained their attention slightly more than before, but then I set out to show why this is more than being compliant...

It’s about how trust can be developed with your customers, and in most cases that begins with a visit to your website. From that point they’re on their own, with nobody to explain, inform and hold their hand through the process.

Read on...

Pricing Transparency

With around 14 years of experience under my belt in global car rental eCommerce, and despite my areas of responsibility already spread across a number of areas, in 2014 I was also tasked with overseeing online compliance in a project we called the Pricing Clarity Initiative but it turned out to involve so much more than clear pricing.

Meeting these legal obligations provided the opportunity to make many improvements which, without exception, were for the customer’s benefit. The challenge was how to implement these changes to a global car rental platform when the same rules didn’t apply globally.

It took a lot of effort, and there was some resistance, but it was the catalyst for many customer centric improvements which made a positive difference, increased trust, and were good for the brand.

International scope

Although my initial objective was to meet the demands of the European Union Commission and the CMA for the websites which served our European customers, most of the changes would have a consequential impact on other countries too, and not necessarily in a good way.

So the scope of the overall compliance initiative, which involved multiple projects of varying magnitudes, needed to be expanded to a global perspective.

The varied rules, requirements and expectations of other countries also needed to be taken into account, and solutions implemented so that Europe, the US, Canada, Australia and elsewhere could have their own rules and requirements handled appropriately.

Some were cultural, but many were legal and they varied from country to country. They included rules around source based pricing, surcharges, age restrictions, opting into marketing communications, and many others besides clarity around pricing, such as whether prices displayed are inclusive of taxes and other charges.

International differences

In the UK you would expect that if a child seat priced at £20 is added it to a car rental reservation, the overall price of that reservation would increase by £20 because the displayed price should be inclusive of taxes and other charges.

That's what UK customers expect. They also expect that items in a shop are displayed with their final price, and wouldn't expect more to be added at the checkout. In the US things are different, because sales tax is added to the cost of the item at the checkout.

So on that basis, in the US if a child seat priced at $13.99 is added to the reservation, the price is likely to increase by a few dollars more than $13.99 due to tax being added, as well as increases to other charges, such as location service charges, which can also be subject to tax.

But what about a UK citizen who wants to rent a car in the US? you might ask.

Based on the aboove explanation, the US rules would cause the price of the item to be displayed exclusive of tax, because that's what US customers expect. But for the UK customer, the additional increase in the amount added to the overall total could be confusing. It could even lead to them feeling that they're being ripped off, and that would be contrary to what the Pricing Clarity Initiative set out to achieve.

Country driven rules

For this reason it was necessary to determine what conditions needed to be met for each requirement to be handled correctly. Some conditions would need to be based on the customer's country of residence, and some based on the country of rental. We referred to those as source and destination countries, respectively.

In some cases the combination of countries needed to be taken into consideration, which was especially relevant around the time of BREXIT when the UK left the EU...

Suddenly there were different rules for UK citizens renting a car in Europe, and European citizens renting a car in Europe, which now needed to exclude the UK. This brought about a number of specific functional changes, such as for the new requirements surrounding driving licences and driving permits.

Approximate Total

Why might a car rental company display prices as Approximate or Estimated, even when making the effort to be transparent about pricing? After all, most customers want to know precisely how much they'll be paying, and not a estimation.

On one hand, there is the potential for the customer to add other options to their rental when they arrive at the counter. This might include insurance waiver upgrades, or adding another driver. But in my opinion if the selections made online are all that the customer requires, why might there still be the need to state that the price is approximate?

Currency exchange rates are often the cause. Let me explain...

Currency exchange rates

Fluctuations in currency exchange rates happen all the time, and if you check the exchange rates between two currencies today, by tomorrow they might have changed. So how can this impact car rental prices?

Let's look at some of examples:

For this reason part of the Pricing Clarity implementation was handled with some logic in the coding based on whether the source and destination currencies are the same, and whether ALL of the total cost was being paid online or at the location, or whether part of the total was being paid online, with the remainder at the location.

As such there were three variations of the messaging which enabled us to be compliant, and of course this made things far clearer for the customer.

A lack of consistent naming can also lead to confusion!

Inconsistent naming can lead to confusion!

Different ways of referring to the same or very similar charges can also vary from country to country too, and the use of industry jargon doesn't help either.

Rental Surcharge, Location Service Charges, Customer Facility Charge, Vehicle Licensing Cost Recovery, Vehicle Licencing Fee, One Way Surcharge, Drop Fees, and different ways of referring to age related surcharges and other fees, charges and options also have the potential to confuse customers.

Confusion and Trust

A confused customer could simply leave the reservation process and go elsewhere, but they can also become suspicious about what they're being charged for. So to put it in simple terms, if you aren't prepared to be clear about what you're charging a customer for, why should they trust you?

Add language to the mix

I have shown how customers living and renting in the same and in different countries can influence the content, messaging, currencies, features, options, requirements, terms and conditions, etc. Age can also have an impact, and the level of impact can also depend on the country of rental.

Add 28 languages into the mix, to cater for citizens throughout Europe and the rest of the world, and you have a challenge!

This is not just a case of translating the words on the website. Remember that much of the content is dynamic, which means that each customer during each separate visit to your car rental website will see variations in content and options based on the selections they make.

It's not all staring you in the face...

There will always be far more content behind the scenes than you'll see at any one time when viewing a page. Some of that content may be held in a Content Management System (CMS), as well as in database tables, and in separate tools and systems that are used during the reservation process. That could include location information, vehicle info, ancillaries, legal and informative content, promotional content, and so on.

Remember that country variations of individual sentences, paragraphs or even entire sections may be needed, based not only on where the customer lives, but where they'll be renting a car.

So the volume of content and variations could be vast depending on your business model, market and customer base. But with planning it is manageable.

Can we cut corners?

You answer that, bearing in mind what you think of your customers, and the level of risk you're prepared to take. Here's a real life example to illustrate the point:

It was therefore a sobering thought that we already had translated rental terms available online to download, but it was a timely reminder the compliance, transparency and fair treatment of customers can make a huge difference.