Travel agencies

The state of online travel agencies

The online travel market is expected to grow 18% in 2022 to reach $76.7 billion, slightly lower than gross bookings in 2019, according to new research from Phocuswright.

According to the U.S. Online Travel Agency Market Report 2021-2025, gross OTA bookings are on track to surpass pre-pandemic levels in 2023, although international travel will continue to recover slower than domestic travel.

For 2021, OTAs generated $65.2 in gross bookings, reaching 82% of pre-pandemic levels. Overall, OTAs accounted for 24% of gross bookings in the US in 2021, up from 20% in 2020.

Research from Phocuswright reveals that for the core OTA business in the US (excluding Vrbo and Egencia), Expedia and Booking collectively accounted for approximately 93% of the non-OTA managed travel and leisure market in 2021.

Globally, Expedia saw gross bookings up 67% and reservations up 79% from 2019 levels. Compared to 2020, Expedia nearly doubled its global gross bookings in 2021, while Booking more than doubled its 2020 figure.

Elsewhere, smaller OTAs including CheaOair, Hopper and HotelTonight collectively grew 60% in 2021 compared to 2020.

OTA vs direct provider

In 2021, OTAs regained their share of the total online market, rising from 35% to 37%. However, supplier websites retained their majority stake in the U.S. online travel market, with a 63% share of gross online bookings.

The hospitality segment remains the only one where OTAs continue to overtake provider websites, but not by much. In 2021, OTAs accounted for 52% of the online hotel market, but their share is expected to drop to 48% in 2025.

For flight and car rentals, although supplier websites are the preferred booking channel, OTAs have gained share in both segments, with gross online flight bookings capturing 20% ​​in 2021 from 19% in 2020, and car rentals at 35%, compared to 32% previously. in 2020.

Portable

According to Phocuswright, mobile has been a winner in the pandemic era, promoting safer and smoother travel, and OTAs are paying more attention to their apps.

In 2021, the majority of Booking’s mobile nights were made through its app, while competitor Expedia has expressed plans to become an app-focused business.

Beyond one-time booking interactions, OTAs see apps as a way to drive customer retention and ongoing engagement.

More than half (51%) of gross OTA bookings were made via mobile in 2021, 10% more than the pre-pandemic mobile share.

“Mobile will continue to gain share in the coming years as OTAs improve and invest in their mobile product, albeit at a slower pace than at the start of the pandemic,” the Phocuswright report states.

“As travel normalizes, desktops will regain some of the share lost to mobile, as the mix of customers and products will be better aligned with desktop bookings (e.g. more international travel , longer trips and air travel).”

For more insight into the OTA market, download the full study here.

ABOUT PHOCUSWRIGHT INC.

Phocuswright is the travel industry’s research authority on how travelers, suppliers and intermediaries connect. Independent, rigorous and impartial, Phocuswright promotes intelligent strategic planning, tactical decision-making and organizational effectiveness.

Phocuswright offers qualitative and quantitative research on the changing dynamics that influence the distribution of travel, tourism and hospitality. Our market intelligence is the industry standard for consumer segmentation, sizing, forecasting, trends, analysis and travel planning behavior. Every day around the world, senior executives, marketers, strategists, and research professionals from every segment of the industry value chain use Phocuswright research for competitive advantage.

To complement its primary research in North and Latin America, Europe and Asia, Phocuswright produces several high profile conferences in the United States and Europe, and partners with conferences in China, Singapore and the United Arab Emirates. . Industry leaders and business analysts bring this intelligence to life by debating issues, sharing ideas, and defining the ever-changing reality of travel commerce.

The company is headquartered in the United States with Asia-Pacific operations based in India and local analysts across five continents.

Phocuswright is a wholly owned subsidiary of Northstar Travel Media, LLC. (116 32nd Street, 14th Floor, New York, NY 10001 USA). www.phocuswright.com

ABOUT NORTHSTAR TRAVEL GROUP

Northstar Travel Group is the leading provider of business-to-business news, information, data, transactions and personalized content solutions for the travel, meetings and hospitality industries. Brands under the Northstar umbrella include Travel Weekly, Travel Weekly China, Travel Weekly Asia, TravelAge West, Business Travel News, Phocuswright, Meetings & Conventions, M&C China, Web in Travel and Inntopia. Northstar is the industry leader in marketing solutions, personalized content communications, content licensing and database management serving the travel and meetings industries. The company produces more than 52 face-to-face events, which take place in North and South America, Europe, Asia and the Middle East. Northstar is based in Secaucus, NJ, and is a portfolio company of EagleTree Capital. www.northstartravelgroup.com