Online Travel Agencies Creep up on Supplier Share Down Under

Travel is quietly bouncing back in the Australia-New Zealand (ANZ) market, on the back of stronger domestic demand and a healthier airline sector. ANZ reversed its 2013 decline, but still gained just 3% in local currency terms in 2014, according to Phocuswright's Australia-New Zealand Online Travel Overview Eighth Edition: A Swift Recovery, Steady Growth Ahead. As the market returns to modest growth, intense competition among online travel agencies (OTAs) is allowing online intermediaries to gain ground on suppliers. OTAs' share of online bookings will inch up from 21% in 2014 to 22% in 2017, as they make annual gains a few percentage points bigger than supplier websites.

Much of the region's online growth is coming from the lodging sector, and that is good news for OTAs, which are focusing their attention on the fragmented, higher-margin hotel space. ANZ's OTAs are pursuing growth on several fronts – investing in technologies to diversify product offerings, expanding overseas and even acquiring to eliminate or overtake competition.

ANZ's powerhouse traditional agencies – including Flight Centre, Helloworld and House of Travel – are giving online agencies a battle. Traditional agencies draw on their multi-channel presence via retail stores, call centers and online. Although online channels account for just a single-digit share of traditional agencies' total leisure business, they are increasingly going after OTAs on their own turf – improving their websites and developing mobile applications, empowering travelers to research and purchase online.

Phocuswright's Australia-New Zealand Online Travel Overview Eighth Edition presents market sizing and projections for ANZ's total and online leisure and unmanaged business travel markets from 2013 – 2017. The report also provides a detailed analysis of trends and dynamics within the ANZ travel market.

Highlights include:

• Total market and online leisure/unmanaged business travel bookings for 2013-2017
• Analysis of major travel product segments – air, hotel and car rental
• Comparison of supplier-branded websites and online travel agencies (OTAs), including bookings and projected growth rates through 2017
• Discussion of the OTA landscape, including key players, recent developments and the relative influence of local versus global OTAs
• Mobile trends and outlook