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More than one third of Canadian travel is now booked online. The online market continues to grow and now accounts for CAD$8.5 billion of the $25 billion travel industry in Canada. While online penetration trails the U.S. market, online travel in Canada clearly outperformed the broader travel industry amid the recession and will only increase in the years to come.
PhoCusWright's Canadian Online Travel Overview Second Edition, 2007-2011 delivers key data and analysis necessary for any travel company seeking to understand the unique nuances of the Canada travel marketplace and gain competitive advantage:
- Travel distribution trends across air, lodging, tours and packages, cruise, rail and car rental
- Consumer shopping and booking behavior
- The Canadian online travel market outperformed the overall market in the recession
- Online travel surpasses one-third of total bookings in 2009
- The Canadian travel and online travel marketplace has more similarities with Europe than with the U.S.
- The recession has benefitted online travel agencies (OTAs)
- Shopping behavior varies greatly between the summer and winter travel seasons in Canada
- 83% of Canadian travelers cite Internet websites as their usual travel shopping method
- Canadians are multi-channel purchasers; offline channels still play an important role
- Canadian OTAs differ greatly from global OTAs in their business model and focus
Table of Contents
Canada Market Overview
Size of the Market
The Canadian Leisure Traveler: Key Behavioral Trends
Online Travel Agencies Gain Ground
The Three OTA Models
OTAs Rise Amid the Recession
Airlines: Direct Distribution Takes a Step Back
Packaged Travel: An Irrational Market
Tour Operators' Countercyclical Lift
OTAs Surge as Tour Operator Sites Sag
Land and Sea: Hotel, Car, Rail and Cruise
Fragmentation Constrains Online Hotel Bookings
Rental Car & Rail
Cruise: Gaining Momentum
LIST OF TABLES
Canadian and U.S. Total Travel Markets and Annual Change, 2007-2011 (C$B)
Canadian Total and Online Leisure/Unmanaged Business Travel Market Gross Bookings and Annual Change, 2007-2011 (C$B)
Canada, U.S., Europe, Asia Online Travel as a Percentage of Total Travel Markets
Usual Purchase Method for Canadian and U.S. Leisure Travelers
Canada Total and Online Travel Markets: Composition by Product, 2009
Share of Canadian Online Travel Market by Supplier Websites & OTAs, 2007 and 2009
Total Travel Market and Online Leisure/Unmanaged Business Travel by Product Segment and Annual Change, 2007-2011 (C$M)
Canadian Leisure Travelers as Share of Online and Total Adult Population
Share of All Trips and Leisure Travel Spend by Season
Destination of Personal Trips by Home Region of Traveler
Typical Shopping Method of Canadian Leisure Travelers
Types of Websites Typically Used When Shopping
Online Features & Technologies That Influence Travel Purchases
Three Types of Online Travel Agencies in Canada
Product Mix for OTAs by Global Brands and Canadian OTAs, 2009
Online Travel Agency Gross Bookings and Annual Change, 2007-2011 (C$M)
Share of Canadian OTA Market by Global OTA Brands and Canadian OTAs, 2009
Total Air Passenger Revenue and Share by Airline Websites and OTAs, 2007-2011 (C$B)
Packaged Travel Sales by Channel and Package Type, 2007-2011
Packaged Travel Bookings by Package Type, 2007 and 2011
Online Share by Travel Segment, 2007-2011
Annual Growth in Cruise Line Passengers and Revenue from Canada, 2008-2009
PhoCusWright's Canadian Online Travel Overview Second Edition: 2007-2011 addresses the Canadian marketplace as a point of sale. PhoCusWright's estimates and forecasts cover all travel purchased within Canada for domestic, transborder (Canada-U.S.) and outbound international travel, including travel suppliers (scheduled and charter airlines, hotels, car rental companies, tour operators, railways and cruise lines) and online travel sellers.
All figures are in Canadian dollars unless otherwise stated. In some cases, currency conversion between U.S. and Canadian dollars was required. PhoCusWright used an exchange rate based on a cumulative annual average from online global currency resource Oanda.com.
The size of the total Canadian travel market is based on aggregate supplier revenues across airlines, hotels, car rental companies, tour operators, cruise lines and rail, and includes leisure and business travel. The size of the online travel market in Canada includes leisure and unmanaged business travel. (Unmanaged business travel refers to all air, car and hotel expenses associated with business travel in firms that do not have a travel policy dictating the channel, type of travel, supplier or fare/rate uses.) Corporate online booking systems such as Sabre/GetThere and Amadeus/e-Travel, as well as the corporate travel units of online travel sellers (e.g., Egencia), are not included in the online market figures.
PhoCusWright built its estimates and forecasts from discussions with more than 30 travel executives across the Canadian/U.S. travel industry regarding their companies' Internet sales, marketing and technology investments, challenges, strategies and expectations. Their responses have been vetted and aggregated to determine market size for supplier websites and online travel agencies. PhoCusWright has also obtained data from financial reports of public companies, industry associations such as the Hotel Association of Canada, and reputable third-party sources, including Statistics Canada, PKF Hospitality Research, Cruise Lines International Association and other entities.
Figures for 2007-2009 are based on actual company results. Projections for 2010-2011 are based on company interviews, consumer survey research and market developments. PhoCusWright also considers historical growth and economic trends when developing its forecasts.
Estimates and projections are for gross bookings - the retail value of travel sold - after cancellations for the core travel product segments (flights, hotels, car rental, packages, cruise and rail). This report excludes, wherever possible, additional revenues, such as in-room purchases,restaurant and retail revenues for hotels, and onboard revenues for cruise lines and rail operators.
Several online travel agencies (OTAs) in the Canadian market conduct a significant volume of bookings offline through their call centers. However, PhoCusWright considers all of these sales within the online travel market. These OTAs, which include itravel2000, Red Tag Vacations, SellOffVacations and others, principally operate as online brands and drive their business through online marketing.