Came across the findings of this interesting report capturing the change that’s happening in the online travel world. The findings are quite insightful and a telling view about the coming dominance of the online infrastructure in the services world.Amongst the findings :
- Suppliers (e.g., airlines, hotels and car rental agencies) have been outperforming online travel agencies (e.g., Expedia, Travelocity, Orbitz and Priceline) since 2000, this interesting report finds that the growth rates for the two channels will converge by 2008.
- While the pressure that travel suppliers put on intermediaries has at least partially spurred significant ownership changes among three of the largest players in the industry: the private equity buyouts first of Cendant (renamed TravelPort) and now of Sabre Holdings, as well as TravelPort’s purchase of Worldspan, the suppliers’ online advantage is disappearing as the majority of travel transactions move to the Web.
- While the U.S. represented just one third of total online and offline travel bookings of the combined North America, Western Europe and Asia Pacific markets in 2005, the U.S. share of online bookings was over 60 percent of all online bookings. The emerging markets are witnessing increasing action as well.
- Growth of dynamic packaging - the ability of consumers to easily combine airline, hotel, rental car and other product purchases online - is projected to slow significantly from 51 percent in 2005 to 18 percent in 2008.
- The advanced level of the U.S. online travel market creates an atmosphere in which many innovations such as dynamic packaging, metasearch and user-generated content incubate in the U.S. before expanding to other global markets. Many of these innovations include the new online capabilities that PhoCusWright has termed Travel 2.0 (In line with the 2.0 hype seen all around)—the travel industry’s application of Web 2.0 practices empowering the online consumer.
Every aspect of service industry is getting influenced by the power of the web in fundamental ways -it's obvious that the deflationary effect of internet is beginning show up and influence business, indications are that more and more of this would be felt in the coming years.
Category :Online Bookings, Emerging Trends