Suppliers Still Dominate Online, but Lose Momentum Globally

Have suppliers won the online travel distribution battle over online travel agencies (OTAs) on a global scale? That depends on which metric is used – overall share or year over year change. While the balance of online power varies by segment and country, there is one overall trend: supplier websites dominate in most online markets. However, as OTAs expand their offerings throughout the world, they will stop suppliers in their tracks over the next three years.

Overall, supplier direct websites represented 62% of global online sales compared to 38% for OTAs, according to Phocuswright's Global Online Travel Overview Third Edition (included in the Asia Pacific, European and Global Edition subscriptions). While OTAs do not yet dominate in any of the major travel regions*, they have the greatest share in Eastern Europe (50%) and Latin America (41%).

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"Both are emerging markets where local players, such as Oktogo in Russia and Decolar in Brazil, battle it out with global powerhouses such as Booking.com and Expedia," says Lorraine Sileo, Phocuswright's senior vice president, research. "However, in other regions such as the U.S. and Asia Pacific, the strength of airline direct websites and mobile apps overpowers OTAs. Led by airlines' direct initiatives, supplier direct websites represent 65% of online sales in both regions versus just 35% for OTAs."

The good news for OTAs is that consumers continue to flock to their brands throughout the world, particularly for hotels and mobile offerings. For that reason, their share of the global market (38%) will remain unchanged through 2015.

Phocuswright's Global Online Travel Overview Third Edition compares online and total travel bookings for six global regions: the U.S., Europe, Eastern Europe, Asia Pacific, the Middle East and Latin America. The report features market sizing and growth forecasts through 2015 for the total and online leisure travel markets.

Key topics include:

• Global market share by region
• Online travel penetration and regional growth potential
• Analysis of supplier-intermediary dynamics and variation by region
• Market trends for key countries in each region

Despite significant regional differences, online travel has clearly taken hold in all of the world's major travel markets. Purchase Phocuswright's Global Online Travel Overview Third Edition for insight into the opportunities and dynamics shaping this vibrant industry.

* Europe, U.S., Asia Pacific, Eastern Europe, Latin America, Middle East