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Online Travel Market Size - By Services (Transportation, Accommodation, Tour Packages), By Mode of Booking (Online Travel Agencies, Direct Travel Suppliers), By Platform (Mobile-based, Web-based), By Traveler, By Application & Forecast, 2024 - 2032


Published on: 2024-07-28 | No of Pages : 240 | Industry : Professional-Services

Publisher : MRA | Format : PDF&Excel

Online Travel Market Size - By Services (Transportation, Accommodation, Tour Packages), By Mode of Booking (Online Travel Agencies, Direct Travel Suppliers), By Platform (Mobile-based, Web-based), By Traveler, By Application & Forecast, 2024 - 2032

Online Travel Market Size

Online Travel Market size was valued at USD 600.5 billion in 2023 and is estimated to register a CAGR of over 7% between 2024 and 2032, fueled by a combination of economic factors and favorable market conditions. As global economies expand, individuals have greater disposable income to allocate towards travel and recreational pursuits.

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In May 2024, a report by the World Travel & Tourism Council highlighted a 20% increase in global travel expenditure. It is attributed to economic recovery and increased consumer spending on travel. Additionally, promotional offers, discounts, and competitive pricing strategies employed by online travel agencies further stimulate customer interest.
 

Online Travel Market Report Attributes
Report Attribute Details
Base Year 2023
Online Travel Market Size in 2023 USD 600.5 Billion
Forecast Period 2024 - 2032
Forecast Period 2024 - 2032 CAGR 7%
2032 Value Projection USD 1.1 Trillion
Historical Data for 2021 – 2023
No. of Pages 240
Tables, Charts & Figures 360
Segments covered Services, Mode of Booking, Platform, Traveler, Application
Growth Drivers
  • Rising consumer spending on travel and tourism
  • Technology advancements in online booking platform
  • Increasing Internet penetration and digital connectivity
  • Rise in government initiatives for travel industry
Pitfalls & Challenges
  • Regulatory compliance
  • Economic and geopolitical instability

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Partnerships and acquisitions can help market players to tap into new customer demographics or geographic regions. Collaborating with established travel brands or loyalty programs can enhance brand image and attract customers who trust the partnered brand. Strategic initiatives also help companies to expand their market reach and technological capabilities. In April 2024, Booking Holdings acquired the travel search engine, KAYAK to enhance its technological infrastructure and expand its market presence. Through this acquisition booking holdings can leverage its expertise to improve its metasearch capabilities to offer a wider range of travel options and more user-friendly search experience for customers.

The online travel market operates across different jurisdictions, each with its own regulations on data protection, consumer rights, and taxation. Adapting to new regulations can be costly and complex, especially for companies operating internationally. For instance, economic recessions can reduce discretionary spending on travel, impacting online bookings and overall market growth. Additionally, political instability and conflicts can disrupt travel plans and affect consumer confidence.

Online Travel Market Trends

Governments around the world are increasingly recognizing the economic and social benefits of a thriving online travel industry. This has led to a surge in initiatives and policies aimed at supporting the growth of online travel services. Governments are offering tax breaks, travel vouchers, or interest-free travel loans to encourage domestic travel. This incentivizes citizens to explore their own country, boosting domestic tourism bookings through online platforms.

Governments are introducing electronic visa application processes, simplifying visa requirements and processing times for international travelers. This encourages easier entry and faster booking decisions, facilitated through online travel platforms. In January 2024, the Indian government announced a simplified e-visa process for 50 additional countries, resulting in a 25% increase in international travel bookings via online platforms.

The travel industry is witnessing a fascinating conflict between traditional travel agencies and online travel services. While OTMs have dominated bookings in recent years, consumer behavior is showing signs of a shift, leading to a potential resurgence of the modern travel agency model. Modern travel agencies offer a curated experience tailored to individual needs and preferences. They leverage human expertise to provide guidance, recommendations, and handle complex travel arrangements. Travelers now seek personalized itineraries and experiences tailored to their preferences.

In February 2024, TripAdvisor expanded its personalization tools, including AI-driven recommendations for hotels, restaurants, and activities based on user preferences and past behavior. This helps to enhance communication and streamline their services.

Online Travel Market Analysis

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Based on platform, the market is divided into mobile-based and web-based. The mobile-based accounted for a market share of over 55% in 2023. Mobile-based offerings have become essential for travel companies to capture and engage users effectively, as the proliferation of smartphones has led to increased adoption of mobile travel apps. Consumers increasingly prefer booking and managing their travel through mobile apps due to their convenience and functionality.

Governments are investing in digital infrastructure to support mobile connectivity, which is crucial for the effectiveness of mobile travel apps. Policies are also being developed to ensure secure and seamless mobile transactions for travel services. In February 2024, the Indian government promoted digital payments through mobile apps. It encourages travel companies to adopt mobile payment solutions to facilitate easier transactions for both domestic and international travelers.

Mobile travel bookings have been rising, with users favoring apps for real-time updates, easy access, and personalized experiences. Users expect personalized experiences and tailored recommendations from their mobile travel apps. The ability to access and manage travel information on-the-go is a significant driver of mobile app usage in the travel sector. In April 2024, Hopper updated its app to include personalized travel alerts, which notify users of price drops and deals based on their search history and preferences. It led to a 35% increase in app downloads.

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Based on traveler, the online travel market is categorized into leisure traveler and business traveler. The leisure traveler is expected to hold over USD 700 billion by 2032. Rising disposable incomes, especially in emerging markets, are contributing to a higher demand for leisure travel. Leisure travelers are increasingly looking for authentic, off-the-beaten-path experiences, including local culture and hidden gems. There is also a growing interest in sustainable travel options, eco-friendly accommodations, cultural immersion, adventure tourism, and eco-tourism.

Leisure travelers are increasingly seeking unique, personalized travel experiences over traditional vacation packages. In April 2024, Airbnb expanded its "Experiences" section to include more niche and adventure activities, such as local cooking classes, wildlife safaris, and cultural tours. It led to a 40% increase in bookings for such experiences.

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North America online travel market accounted for 35% of the revenue share in 2023. North America, particularly the U.S. and Canada, has a high level of internet and smartphone penetration, which drives the adoption of online travel services. Travelers in North America prefer personalized travel experiences, relying heavily on digital platforms for customized itineraries and recommendations.

The region shows a strong rebound in travel demand, driven by both domestic and international travel. In March 2024, The U.S. Department of Commerce launched a new campaign to boost international tourism, partnering with online travel agencies to offer promotional deals and discounts. It resulted in a 25% increase in travel bookings to the U.S.

The Europe online travel market is characterized by diverse travel preferences, ranging from cultural tourism to beach vacations, leading to a robust demand for varied travel options. There is a growing emphasis on sustainable travel and eco-friendly tourism options in Europe as well. In March 2024, The European Commission launched the Digital Travel Initiative to support digital transformation in the travel sector. It focuses on enhancing online travel platforms and mobile app capabilities across EU member states.

APAC countries, including China, India, Japan, South Korea, Indonesia, and Australia, are experiencing rapid growth in online travel bookings due to increasing internet penetration, a burgeoning middle class, and a rising interest in international travel. The region is highly diverse, with varying levels of digital adoption and travel preferences across different countries. In March 2024, the Chinese government unveiled a Smart Tourism Development Plan aimed at integrating advanced technologies into the tourism sector, including AI, Big Data, and Internet of Things (IoT). It aimed to enhance the online travel booking experience and provide personalized travel services.

Online Travel Market Share

Booking Holdings and Expedia Group dominate the market with around 5% market share. Booking Holdings primarily focuses on the Online Agency Model (OTA), acting as an intermediary between travelers and travel suppliers. It earns revenue through commissions on bookings made through its platforms including Booking.com, Priceline, Kayak, Agoda, etc. Additionally, the company leverages a metasearch engine model for additional revenue streams.

Expedia Group utilizes a combined OTA and metasearch model. However, it might have a slightly higher focus on the metasearch model compared to Booking Holdings. The company’s brand portfolio includes Expedia.com, Vrbo, Hotels.com, Travelocity, and Orbitz. It leverages industry-leading technology, including AI predictions and virtual conversations.

Online Travel Market Companies

Major players operating in the online travel industry are

  • American Express Travel
  • Booking Holdings
  • CheapOair
  • EaseMyTrip
  • eTraveli Group
  • Expedia Group
  • Kiwi.com
  • Orbitz
  • Sabre Corporation
  • Trip.com Group
  • Webjet Limited

Online Travel Industry News

  • In May 2024, The Singapore Tourism Board launched a digital marketing campaign promoting online travel platforms and digital travel services to attract tourists from neighboring countries. The campaign has led to a 20% increase in tourist arrivals and boosted bookings on local travel websites.
  • In May 2024, The U.S. Department of Commerce launched grants to support travel tech innovations, focusing on enhancing mobile travel solutions and integrating AI for better user experiences. This initiative aims to boost the competitiveness of travel tech firms based in the U.S. in the lobal market.

The online travel market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD Billion) from 2021 to 2032, for the following segments

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Market, By Services

  • Transportation
    • Airline
    • Car rental
    • Rail
    • Cruise
    • Bus
  • Accommodation
  • Tour packages

Market, By Mode of Booking

  • Online travel agencies
  • Direct travel suppliers

Market, By Platform

  • Mobile-based
  • Web-based

Market, By Traveler

  • Leisure
  • Business

Market, By Application

  • International booking
  • Domestic booking

The above information is provided for the following regions and countries

  • North America
    • U.S.
    • Canada
  • Europe
    • UK
    • Germany
    • France
    • Italy
    • Spain
    • Russia
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • South Korea
    • ANZ
    • Southeast Asia
    • Rest of Asia Pacific 
  • Latin America
    • Brazil
    • Mexico
    • Argentina
    • Rest of Latin America
  • MEA
    • UAE
    • South Africa
    • Saudi Arabia
    • Rest of MEA

 

Table of Content

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To get a detailed Table of content/ Table of Figures/ Methodology Please contact our sales person at ( chris@marketinsightsresearch.com )