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OTA growth in Europe & US - An overview

Posted Date:  July 15, 2019

Online travel agencies (OTAs) has found their niche in the European travel market. Even though all the key players are popular among European travellers, the competition has reached a point where there are just one or two players striving, making it extremely challenging for smaller OTAs to stay in the game. Moreover, certain OTAs are now overshadowed by the online supplier-direct channel, as a result of suppliers' success in developing and promoting their own online booking platforms.

During 2018, the supplier-OTA channel reached €47.9 billion. Only a modest growth is expected in the coming years, as OTA bookings grow at roughly half the pace of the supplier-direct channel. More specifically, in terms of OTA channel distribution, growth has become uneven; on the other hand, conventional bookings are projected to be flat for the next few years, OTA mobile bookings are projected to skyrocket.

In general, OTAs has given more focus on technology than have travel suppliers, and it is important for them to maintain the focus to remain competitive with online direct bookings in certain segments. As there is a high-growth in mobile channel this move is true in every aspect.

Meanwhile US online travel growth continues to overtake the overall market, and this trend is going to stay until at least 2022. Although supplier websites are expected to grow slightly faster than online travel agencies (OTAs), the online balance between suppliers and intermediaries will remain unchanged through 2022.

A healthy 5% growth is projected in the U.S. travel market  in 2018 which is a benefit of the positive economic performance, particularly in the first three quarters of the year. As per the travel research from Phocuswright, annual gains are estimated to remain steady in 2019, before a slow down through 2022. By then, total gross bookings will have increased to $441 billion. 

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Author: Sathish Kumar .S

Sathish works as Project Manager in Teknokraaft and heads our OTA team

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