Hotels Fuel U.S. OTA Growth as Air Bookings Decline

U.S. online travel agencies (OTAs) have long relied on airline tickets as the cornerstone of their business. But sliding air bookings are now forcing OTAs to seek growth elsewhere. According to a new Phocuswright Global Edition report, OTA air gross bookings are projected to drop 7% in 2013 as air suppliers succeed in driving direct bookings via online and mobile channels. Hotel and lodging, not air, is now the segment driving OTA growth.

"OTAs have focused on building their more profitable hotel businesses as they have watched air bookings fizzle, and these investments are paying off," says Lorraine Sileo, senior vice president, research. "Hotels are pushing to drive direct bookings, but the OTAs' aggressive marketing tactics – paired with a distinct advantage in mobile hotel bookings – will keep hotels' and OTAs' share of online bookings steady through 2015."

Lodging is the only U.S. travel segment projected to grow online bookings by double digits in both 2012 and 2013. OTA hotel bookings will grow slightly faster than supplier-direct bookings through 2013, when hotel will surpass air to become the largest OTA segment.

Phocuswright's U.S. Online Travel Overview Thirteenth Edition is a comprehensive analysis of the U.S. travel industry, providing market sizing and growth forecasts through 2015. The report focuses on the U.S. online leisure/unmanaged business travel marketplace, highlighting marketing and distribution trends for all travel segments including air, hotel, car rental, vacation packaging, rail and cruise. It tracks distribution shifts among supplier websites and online travel agencies, as well as major offline channels. The report also features mobile market sizing and forecasts, providing rich insight into the growing influence of smartphones and tablets. This research provides a detailed overview of travel distribution in the U.S., with analysis of trends in market share, technological innovation and consumer behavior.

Topics include:

• Size of the U.S. total and online travel markets
• Market sizing and forecasts through 2015, including breakouts for air, car, hotel, tour operators, rail and OTAs
• Mobile travel sizing and projections for all segments
• Distribution patterns and projections by segment and channel
• In-depth analysis of air, hotel, car rental, vacation packaging and cruise segments
• Consumer and technology trends influencing travel marketing and distribution
• Impact of macroeconomic changes

Phocuswright has followed the evolution of online travel purchasing from its inception. U.S. Online Travel Overview Thirteenth Edition is the industry standard for sizing and forecasting, providing actionable insights into the U.S. travel market.