Online travel market expected to reach $1,835.6 billion
The travel market has evolved significantly over the past few years, due to the digitalization of travel services and the growth of the travel trend, worldwide. The proliferation of mobile devices largely complements the growth of this market. The market is witnessing consolidation, with major online travel agencies (OTAs) acquiring start-ups and other smaller players, giving stiff competition to direct travel providers and established travel agents.
According to a new report published by Allied Market Research, titled “Online Travel Market by Service Types, Platforms, Booking Mode and Age Group: Global Opportunity Analysis and Industry Forecast, 2022-2031” ,
Global Online Travel Market was valued at USD 354.2 Billion in 2020 and is projected to reach USD 1,835.6 Billion by 2031, registering a CAGR of 14.8% from 2022 to 2031. world, the number of people belonging to the middle and upper classes is growing rapidly. .
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People now opt for more than one trip each year with rising living standards and increased purchasing power. Moreover, for convenient and easy transactions, people have started using online travel services, thereby saving time and resources, promoting the growth of online travel market. The growth of the online travel market is driven by increasing internet penetration, increasing disposable income of people in emerging markets, and the ease of comparing a variety of online travel options. Market players are introducing innovative travel and vacation packages to help travelers make wise travel decisions based on their spending capacity such as affordable packages to international destinations, car rental discounts and cash back on international flights.
Political unrest and natural calamities are some of the factors restraining the growth of the online travel market. Additionally, low digital literacy and unavailability of internet connection in remote areas are expected to limit the market growth.
The COVID-19 outbreak has had a negative impact on the growth of the online travel market in 2020. Frequent lockdown practices, social distancing and ban on travel and tourism in most countries have been some -some of the attributes of declining market growth in 2020.
According to the online travel market analysis, the online travel market is segmented into service type, platform, booking mode, age group and region. Based on type of service, the market is categorized into transportation, travel accommodation and vacation packages. By platform, it is segmented into mobile and desktop. Based on booking mode, it is separated into online travel agencies (OTA) and direct travel providers. Based on age group, the market is segmented into 22-31, 32-43, 44-56, and >56. By region, it is analyzed in North America (United States, Canada and Mexico), Europe (Germany, France, United Kingdom, Italy, Spain and rest of Europe), Asia-Pacific (China, India , Japan, Australia, Korea and Rest of Asia-Pacific) and LAMEA (Brazil, Argentina, United Arab Emirates, Saudi Arabia, South Africa and Rest of LAMEA).
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According to Online Travel Market Trends, based on service types, the transportation segment was valued at $145.8 billion in 2020 and is projected to reach $670.6 billion by 2031, with growth at a CAGR of 13.6% from 2022 to 2031. Transportation segment is expected to maintain its lead in the overall online travel services market, owing to the increase in online flight bookings. Expanding number of low-cost carriers and growing number of connecting flights for Tier I and II cities across the globe are driving the growth of flight bookings, which is contributing significantly to the growth of the market online travel during the forecast period. Tier I cities are densely populated and have higher living costs and Tier II cities have a moderate cost of living and decent infrastructure and connectivity.
By platform, the mobile segment accounted for the major share of the global market in 2020 and is expected to increase its share during the forecast period. Increased smartphone penetration, increasing people’s confidence in mobile payment security, growing digital literacy, and use of social media for advertising are likely to contribute to the growth of the market through the mobile segment.
Based on booking mode, the online travel agency (OTA) segment accounted for a considerable share of the global online travel market and is expected to maintain its share throughout the forecast period of the online travel market. OTAs are gaining popularity in the online travel market due to the low-cost travel options they provide. They give travelers the ability to plan and book trips as and when they need them. OTAs are gaining popularity in the market due to the low cost travel options they provide. They give travelers the ability to plan and book trips as and when they need them. Flight bookings contribute approximately 87% of OTA sales; however, they have also taken initiatives to diversify into non-airline products. Non-airline products include hotels, buses, trains and others. Currently, OTA mainly contributes to the revenue generation of hotels.
On the basis of age group, travelers in the 32-43 age bracket occupy a significant share of the market. However, from a growth perspective, younger travelers in the 22-31 age group are expected to experience the highest CAGR, due to heavy use of social media and smartphones for planning and bookings. of travel. This age group traveler’s early research analyzes various sites online and when planning a vacation or a short weekend getaway. These people have a high purchasing power compared to other people in the age group.
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According to the online travel market opportunities, by region, North America led the online travel market share and is expected to be dominant during the forecast period. Soaring demand from travelers looking for perfectly clean sites and personalized services in a normal environment is also increasing the demand for North American tour packages. The growth in the number of trips per year and the emergence and increase in demand for agritourism and ecotourism are further attributable to the growth of the market in North America.
Players operating in the online travel industry have adopted product launch and business expansion as their key development strategies to grow their market share, increase profitability and stay competitive in the market. Key Players profiled in this report are Expedia Group, Inc., Ebury Partners UK Ltd, Fareportal Inc., Hostelworld.com Limited, Hurb Co S/A, HRS, Make MyTrip Ltd., Oracle Corporation, Priceline (Booking Holdings Inc. ), SABS Travel Technologies, Tavisca Solutions Pvt. Ltd., Thomas Cook India Ltd., travelomatix.com, Trip.com Group, Tripadvisor, Inc. and WEX Inc.
Main results of the study
The Online Travel Market size was valued at USD 354.2 Billion in 2020 and is projected to reach USD 1,835.6 Billion by 2031, registering a CAGR of 14.8% from 2022 to 2031.
In 2020, according to service types, the transportation segment acquired $145.8 billion, securing 41.2% of the global market share.
Based on platforms, the mobile segment acquired $108.8 billion, accounting for 30.7% of the global market share.
In 2020, by booking method, the direct travel provider segment was valued at $197.3 billion, accounting for 55.7% of the market share.
The United States was the largest market in North America in 2020 and is expected to reach $93.2 billion by 2031, growing at a CAGR of 12.0% during the forecast period.
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