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Online Travel Booking Service Products Market Size, Share, & Trends Analysis Report (2023 – 2030)
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Report Overview
The global online travel booking service products market was valued at USD 590.2 billion in 2022 and is expected to expand at a CAGR of 9.7% from 2023 to 2030. The growing penetration of the internet and smartphones has enabled customers to book tickets for flights, hotels, and other travel services at their convenience. Furthermore, with the advent of low-cost airlines, people are more inclined to book flight tickets online and avail the various offers and discounts that these online travel booking websites provide. Additionally, the travel and tourism industry has witnessed a surge in the number of millennial travelers, who prefer to book tickets and make travel arrangements online, further pushing the demand for online travel booking services.
The market is witnessing a shift from offline to online travel bookings, as customers are increasingly spending more time on their mobile devices rather than visiting a travel agency for their travel needs. Online travel booking services provide convenience and multiple options for customers to choose from and book their travel tickets according to their budget and convenience. Furthermore, the development of advanced technologies such as artificial intelligence (AI) and machine learning (ML) has enabled websites to offer personalized services to their customers. For instance, in November 2021, Expedia launched a personalized travel assistant, which uses AI and ML to provide personalized recommendations to travelers.
The industry is witnessing a surge in the number of mergers and acquisitions to gain a competitive edge in the market. For instance, in October 2021, Tripadvisor acquired KAYAK, a travel search engine, to strengthen its online travel booking services. With this acquisition, Tripadvisor aims to become a one-stop destination for travelers and increase its market share in the online travel booking services segment. Furthermore, the increasing use of big data analytics by online travel booking service providers to understand customer preferences and to offer customized services is expected to drive the market in the coming years.
Furthermore, the rising trend of online travel booking platforms to offer integrated services is gaining traction in the market. For instance, in April 2021, Trip.com Group launched a new integrated platform, Trip.com Travel Platform (TTP). The platform combines the strengths of the company’s consumer-facing brands such as Ctrip, Trip.com, Skyscanner, and Qunar.
Product Insights
The airline segment accounted for the largest market share of around 35.2% in 2022. The growth of the airline segment is attributed to the increasing demand for online travel booking services. According to an article published by The Guardian, in December 2019, the number of passengers using online travel booking services has doubled since 2016. Furthermore, technological advancements such as AI, machine learning, and big data are expected to boost the growth of the segment.
The hotel segment is anticipated to expand at the fastest CAGR of 8.7% over the forecast period. Increasing adoption of online travel booking services and rising trend of solo travel are some of the key factors driving the hotel segment. According to an article published by World Travel and Tourism Council, in March 2020, the number of solo travelers increased from 15% to 30% in the last 10 years.
Distribution Channel Insights
The online segment is anticipated to capture the highest market share of over 86.3% in 2022. Rising internet penetration and the availability of cheap smartphones have driven the growth of the online travel booking service industry. According to a study by the United Nations International Telecommunications Union in 2020, the internet penetration rate in emerging countries such as India, Indonesia, Vietnam, and the Philippines is expected to reach 60.0% in 2022. This is encouraging travelers to book tickets, accommodations, and other services through online travel booking services.
The travel agencies segment is anticipated to expand at the highest CAGR of 8.7% over the forecast period. The segment is mainly driven by the increasing preference of travelers to book tickets and accommodations through travel agents. According to a study by Statista in 2020, around 32.2% of travelers across the world prefer to book tickets and accommodations through travel agents to save time and money. Travel agents provide valuable insights and recommendations and also assist customers in making rapid purchasing decisions for the required travel products.
Type Insights
The packaged holiday segment accounted for the largest revenue share of 41.5% in the year 2022. The increasing trend of booking holidays in advance to avail discounts and offers is a key factor driving the growth of the packaged holiday segment. Also, the availability of a wide range of packages such as honeymoon packages, adventure packages, and family packages is increasing the demand for the packaged holiday segment. Furthermore, the growing trend of social media marketing and influencer marketing is also boosting the sales of packaged holiday products.
The flights segment is projected to expand at the highest CAGR of 11.2% over the forecast period. The increasing trend of online travel booking services and the growing number of domestic and international flights are some of the key factors driving the growth of the flights segment. Also, the introduction of low-cost airlines and the availability of various flight discounts are expected to further boost the segment. Furthermore, the emergence of online aggregators, such as Expedia and Booking.com, is also likely to propel the segment in the forecast period.
Regional Insights
North America accounted for the highest revenue share of over 32.1% in 2022 due to the presence of a large number of travel booking service providers in the region. The travel industry in the region has been growing rapidly due to changing lifestyles and increasing disposable income of the population. Moreover, the presence of a large number of players offering innovative and technologically advanced services is driving the growth of the market in North America. For instance, in April 2021, Expedia Group announced its new hotel-booking technology that lets customers compare hotel prices with other online travel agents.
Europe is expected to witness the second-fastest growth in the coming years. An increase in the number of travelers to Europe due to its rich cultural heritage is driving the market growth. Moreover, the presence of a large number of travel booking service providers in the region is further expected to drive the growth of the market. For instance, in May 2021, Swiss travel technology company TravelCom announced a partnership with Expedia Group to expand its operations in Europe.
Financial Projections
In this part of the online travel booking service business plan, we will provide a detailed breakdown of all income and expense categories of the business. These forecasts include cash flow projections and capital requirements for your travel booking service. Usually, these projections are drafted for a 5-year period.
Revenue Assumptions
The main source of revenues for an online travel booking service comes from commissions on airline tickets, hotel bookings, car rentals, and other related services. Here you will find a list with a description of each of them and other possible sources of profit such as advertising, partnerships, and discounts.
Projecting Expenses
In this section, all the regular expenses related to keeping the online travel booking service running will be described. The list of operating expenses includes website hosting fees, IT maintenance and support, software licenses, wages, marketing, and others.
Key companies & market share insights
Some of the major players in the online travel booking service market are increasingly focusing on product launches and expansion of the distribution channel to gain prominent visibility among consumers. Some of the initiatives are:
– In May 2022, Airbnb launched Airbnb Luxe, a new tier of luxury homes and experiences, curated with the help of the Luxury Collection.
– In June 2022, TripAdvisor launched a new travel booking platform, TripAdvisor Plus, that offers members exclusive discounts on hotel stays, flights and activities.
– In July 2022, Expedia launched a new feature that allows customers to book flights, hotels and rental cars in one simple step.
Some of the prominent players in the online travel booking service market include:
– Airbnb
– TripAdvisor
– Expedia Group
– Booking Holdings
– Ctrip
– Agoda Company
– trivago
– Traveloka
– MakeMyTrip
– Skyscanner
Global Online Travel Booking Service Market Segmentation
This report forecasts growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global online travel booking service products market based on product type, booking type, customer type, and region:
1. Product Type Outlook (Revenue, USD Million, 2017 – 2030)
– Flights
– Hotels
– Car Rentals
– Cruises
– Others
2. Booking Type Outlook (Revenue, USD Million, 2017 – 2030)
– Online
– Offline
3. Customer Type Outlook (Revenue, USD Million, 2017 – 2030)
– Business
– Leisure
4. Regional Outlook (Revenue, USD Million, 2017 – 2030)
– North America
– Europe
– Asia Pacific
– Central & South America
– Middle East & Africa
Frequently Asked Questions
[Q]: What is the Potential for Growth in the Online Travel Booking Service Market?
[A]: The online travel booking services market is expected to witness a significant growth rate during the forecast period. This can be attributed to the rising number of online travelers, increasing number of online travel agencies, and the rising per capita disposable income. Moreover, the increasing demand for online booking services from customers due to the convenience of online booking is expected to drive the market growth.
[Q]: What are some of the Key Market Trends?
[A]: Growing demand for mobile-based applications, increasing number of digital payments, rising popularity of sharing economy, and increasing number of travel influencers are some of the key trends in the online travel booking service market.
[Q]: Who are the Key Players in the Online Travel Booking Service Market?
[A]: Major players in the online travel booking service market include Expedia Group, Inc., TripAdvisor, LLC, Priceline Group, Inc., Travelzoo, Inc., and Airbnb, Inc.
[Q]: What are the Factors Driving Market Growth?
[A]: The growth of the online travel booking service market is driven by factors such as the increasing number of travelers, rising disposable incomes, increasing demand for convenience, and the rising popularity of sharing economy.
[Q]: Which Region Offers the Largest Opportunity for Sales of Online Travel Booking Services?
[A]: North America is expected to be the most lucrative market for online travel booking services, owing to the presence of a large number of online travel agencies in the region. Furthermore, increasing disposable incomes and the growing trend of online travel booking in the region are expected to fuel the growth of the online travel booking service market in North America.
Research Methodology
Impact Analytix employs a comprehensive and iterative research methodology focused on minimizing deviance in order to provide the most accurate estimates and forecasts possible. The company utilizes a combination of bottom-up and top-down approaches for segmenting and estimating quantitative aspects of the market. In Addition, a recurring theme prevalent across all our research reports is data triangulation which looks market from three different perspectives. Critical elements of the methodology employed for all our studies include:
Preliminary data mining
Raw market data is obtained and collated on a broad front. Data is continuously filtered to ensure that only validated and authenticated sources are considered. In addition, data is also mined from a host of reports in our repository, as well as a number of reputed paid databases. For a comprehensive understanding of the market, it is essential to understand the complete value chain and in order to facilitate this; we collect data from raw material suppliers, distributors as well as buyers.
Technical issues and trends are obtained from surveys, technical symposia, and trade journals. Technical data is also gathered from an intellectual property perspective, focusing on white space and freedom of movement. Industry dynamics with respect to drivers, restraints, and pricing trends are also gathered. As a result, the material developed contains a wide range of original data that is then further cross-validated and authenticated with published sources.
Statistical model
Our market estimates and forecasts are derived through simulation models. A unique model is created and customized for each study. Gathered information for market dynamics, technology landscape, application development, and pricing trends are fed into the model and analyzed simultaneously. These factors are studied on a comparative basis, and their impact over the forecast period is quantified with the help of correlation, regression, and time series analysis. Market forecasting is performed via a combination of economic tools, technological analysis, industry experience, and domain expertise.
Econometric models are generally used for short-term forecasting, while technological market models are used for long-term forecasting. These are based on an amalgamation of the technology landscape, regulatory frameworks, economic outlook, and business principles. A bottom-up approach to market estimation is preferred, with key regional markets analyzed as separate entities and integration of data to obtain global estimates. This is critical for a deep understanding of the industry as well as ensuring minimal errors. Some of the parameters considered for forecasting include:
Market drivers and restraints, along with their current and expected impact
Raw material scenario and supply v/s price trends
Regulatory scenario and expected developments
Current capacity and expected capacity additions up to 2030
We assign weights to these parameters and quantify their market impact using weighted average analysis, to derive an expected market growth rate.
Primary validation
This is the final step in estimating and forecasting our reports. Exhaustive primary interviews are conducted, face to face as well as over the phone to validate our findings and assumptions used to obtain them. Interviewees are approached from leading companies across the value chain including suppliers, technology providers, domain experts, and buyers so as to ensure a holistic and unbiased picture of the market. These interviews are conducted across the globe, with language barriers overcome with the aid of local staff and interpreters. Primary interviews not only help in data validation but also provide critical insights into the market, current business scenario, and future expectations and enhance the quality of our reports. All our estimates and forecast are verified through exhaustive primary research with Key Industry Participants (KIPs) which typically include:
Market-leading companies
Raw material suppliers
Product distributors
Buyers
The key objectives of primary research are as follows:
To validate our data in terms of accuracy and acceptability
To gain an insight into the current market and future expectations
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